In a ruling dated March 12, 2025, the French Supreme Court ruled that action for abrupt termination of established commercial relations was of an extracontractual nature where EU law was not applicable.
In the case at hand, a first company sued a second company before the French courts for abrupt termination of established commercial relations.
The defendant raised an objection of lack of jurisdiction, which the Court of Appeal upheld on the grounds that (i) there was a contractual relationship between the parties, (ii) the place of performance of the contractual service was in the United States, and (iii) although the article relating to the sudden termination of established commercial relations, which constitutes a mandatory rule of law, would be applicable on the merits, this provision did not automatically confer jurisdiction on the French courts.
However, the French Supreme Court overturned the appeal ruling on the grounds that, in international law, an action for abruptly terminating established commercial relations is of an extracontractual nature. Thus, the French courts had jurisdiction to rule on this dispute on the basis of the place where the alleged damage was suffered (at the registered office of the company that was the victim of the termination), pursuant to Article 46 of the CPC.
