Sales of SCI Shares: Notarized Deeds Become the Norm
Until now, two partners could transfer their shares in a real estate partnership simply by signing a document between themselves. A new requirement will mandate the involvement of a legal professional—failure to do so will render the transfer null and void—and will upend a practice that has been in place for decades.
The same scenario played out in thousands of households that held real estate assets through a corporation. The transfer of shares in an SCI (real estate investment company) was often handled within the family, through a private agreement—sometimes just a few lines long—exchanged among relatives, without a notary or lawyer. Although the property was worth several hundred thousand euros, the legal framework surrounding it remained free of any formalities.
For years, the High Council of Notaries had been warning about this discrepancy between the sale of real estate—which is strictly regulated—and the transfer of shares in the company that owns that same property, which had remained entirely unregulated. Notaries in France had pointed out a legal discrepancy between two transactions that are, in economic terms, comparable. The legislature has now settled the matter.
Following approval by the Constitutional Council on June 18, 2026, the law on combating social security and tax fraud is expected to be published imminently in the Official Journal. Its Article 68 creates a new Article 1865-1 of the Civil Code. Any transfer of shares or stock in a company whose assets consist primarily of real estate or real estate rights must now be conducted through a professional. Family-owned real estate investment companies (SCIs), which are the preferred vehicles for holding and transferring real estate, are primarily affected, but the law more broadly applies to all entities that hold real estate assets.
Three Ways to Formalize the Transfer
The text provides for three options, failing which the transfer is void. The transfer may be executed by a notarized deed drawn up by a notary, or by a deed countersigned by an attorney. It may also be drafted by a certified public accountant, provided that the transaction directly extends the scope of the accountant’s professional services to the company. Outside of these three frameworks, the deed has no legal validity.
The notarial profession highlights the real estate expertise required for these transactions—which are part of its day-to-day practice—and emphasizes the need to verify the actual value of the assets held by the company before any sale. Added to this are the enforceability and preservation inherent in a notarized deed, which guarantee the accuracy of the information and the informed consent of the parties. “This is a real turning point,” says Bertrand Savouré, president of the High Council of Notaries.
Enhanced traceability and new best practices
Another objective of the legislation is to combat money laundering. As these transfers were conducted via private agreements, they were not subject to any verification and provided a channel for both money laundering and terrorist financing, without any guidance or safeguards for the parties involved. The new article imposes on the relevant professionals the obligations of due diligence, reporting, and disclosure set forth in the Monetary and Financial Code. The notarial profession, which signed a memorandum of understanding with seven ministries on this matter in July 2025, had been preparing since 2020 to contribute to this effort.
For SCI partners, the change takes effect immediately. Formalization is now essential, entailing drafting and advisory costs that did not exist before, but also providing greater legal certainty for both the seller and the buyer. Shareholders would be well advised to factor this necessary step into their succession plans and to budget for the associated fees. Improvised family arrangements and last-minute private sales are a thing of the past: the transfer of shares will never again be a matter of simply signing a document.
The choice of professional will depend on the circumstances. A notary is required when the sale involves inheritance issues or guarantees that need to be secured, while a co-signing attorney or a certified public accountant is appropriate when continuing to handle transactions already underway. Regardless of the approach taken, the new procedural requirements encourage partners to prepare in advance by valuing the shares and reviewing the company’s financial statements—a task that many had previously put off.
