Assumption of the commitment to build:
the sub-purchaser chain

No. The assumption is possible only if the sub-purchaser is a VAT-taxable person within the meaning of article 256 A of the French Tax Code. In practice, this condition rules out a purchaser acting in a private capacity (Cass. com., 28 mai 2025, n° 24-13.572). Doctrine nevertheless allows the assumption by a public body referred to in article 1042 of the French Tax Code or by a semi-public company (société d'économie mixte) with a majority public shareholding, without it having to give an undertaking of its own (BOI-ENR-DMTOI-10-40, § 360). The assumption also requires that the period allotted to the transferor has not expired on the day of the resale (BOI-ENR-DMTOI-10-40, § 350). In practice, it concerns property dealers, developers, real-estate companies and other professional real-estate operators.

Two mentions are required by doctrine (BOI-ENR-DMTOI-10-40, § 370): (1) the express assumption of the commitment to build (for the undertaking to resell, the sub-purchaser gives its own undertaking, the first purchaser's period being binding on it: French Tax Code, art. 1115, para. 2); (2) the reference to the earlier deed (date, registration and publication number). It is advisable, although the BOFiP does not require it, to add the identity of the initial purchaser, the purpose and scope of the works (art. 266 bis, III of annex III to the French Tax Code) and the period remaining to run. Absent a valid assumption, the tax authorities may consider that the first purchaser remains bound by its undertaking.

No. The sub-purchaser takes over the remaining period of the initial undertaking, counted from the acquisition by the first purchaser. If the initial period is 4 years and the sub-acquisition takes place 18 months after the initial acquisition, the sub-purchaser has 2 years and 6 months to complete the construction, subject to any extensions already obtained by the transferor, which benefit the assignee (BOI-ENR-DMTOI-10-40, § 400). An extension may of course be requested by the sub-purchaser under the conditions of article 266 bis of annex III to the French Tax Code.

The sub-purchaser may combine the assumption of the initial undertaking with its own commitment to build (BOI-ENR-DMTOI-10-40, § 350). If the sub-purchaser waives its right to request an extension of one of the undertakings, or is refused one, doctrine allows it to be released at the same time from the other undertakings relating to the same building and in the same proportion of exemption. It then pays the duties from which it was itself exempted on its acquisition, together with the proportional costs, and late-payment interest running from the first acquisition in the chain, computed on the duties avoided at each transfer for the period elapsed until the next transfer (BOI-ENR-DMTOI-10-40, § 390 and 400). Nothing is waived in respect of the assumption: it is the late-payment interest on the duties avoided upstream that increases the bill.

Yes, where the assumption is regular (express mention, taxable-person status, period not expired): the first purchaser is then released and it is for the assignee to prove completion within the period (BOI-ENR-DMTOI-10-40, § 380). The central criterion remains the production of a new building within the meaning of 2° of 2 of I of article 257 of the French Tax Code, or the completion of an unfinished building, within the allotted period. Absent an assumption, the Court of Cassation refuses to maintain the exemption where the sub-purchaser is not a VAT-taxable person (Cass. com., 28 mai 2025, n° 24-13.572) and requires, at the very least, that this status be verified, even where the sub-purchaser completed the works within the period (Cass. com., 7 mai 2025, n° 24-11.771). An express assumption in the deed remains the only safe route.

The tax authorities may consider that the assumption did not take place validly: the first purchaser then remains bound by its undertaking and loses the exemption if the sub-purchaser is not a VAT-taxable person or did not take over the undertaking (Cass. com., 28 mai 2025, n° 24-13.572). The duties from which the transfer had been exempted are claimed from it on the basis of I of article 1840 G ter of the French Tax Code, together with the assessment and collection costs and the late-payment interest of article 1727 of the French Tax Code (0.20% per month, i.e. 2.40% per year), running from the first day of the month following the expiry of the statutory period for presenting the deed for registration (BOI-ENR-DMTOI-10-40, § 440 and 450). Hence the importance of careful notarial drafting and a prior audit.

Yes. Within five years from the date on which the undertaking was given by the first purchaser, the assignee may substitute an undertaking to resell for it (French Tax Code, art. 1594-0 G, A, II). It then pays the land registration tax at the reduced rate of 0.715% on its own acquisition, together with late-payment interest (BOI-ENR-DMTOI-10-40, § 490 et seq.). The firm first checks that this five-year period has not expired and quantifies the cost of the substitution before any decision.