Background
On 10 November 2016, Mme [E], a micro-business operator, signed two contracts at her premises with vendors who called on her: a long-term rental agreement with De Lage Landen Leasing (DLL) for a photocopier, payable in 21 quarterly instalments, and a maintenance contract with the supplier, Solution Impression Numérique (SIN). The copier was delivered on 22 November 2016. Roughly eight months later, on 13 July 2017, Mme [E] gave written notice to both DLL and SIN that she was exercising a right of withdrawal under articles L. 221-18 et seq. of the French Consumer Code. DLL refused to accept the withdrawal, contending that no such right existed.
Mme [E] brought proceedings in 2018 seeking a declaration that her withdrawal was valid. The Aix-en-Provence Court of Appeal upheld her claim on 21 November 2024, finding that the Consumer Code’s off-premises contract rules — including the right of withdrawal — applied to the rental agreement. DLL appealed to the Court of Cassation, raising three grounds. It argued principally that the rental contract was a “financial service,” which is expressly excluded from the Consumer Code’s off-premises protections, because DLL is an ACPR-licensed financing company authorised to conduct credit-leasing operations, and simple equipment leasing by such companies qualifies as an ancillary banking operation under article L. 311-2 of the Monetary and Financial Code.
The Court of Cassation dismissed the second and third grounds without detailed reasoning under article 1014(2) of the Code of Civil Procedure as manifestly incapable of leading to reversal, and addressed the first ground — the financial-services exclusion — on the merits.
The Court’s Holding
The Court of Cassation rejected the appeal in its entirety. Under articles L. 221-2(4°) and L. 221-3 of the Consumer Code, the statutory protections for off-premises contracts (including the right of withdrawal) are extended to contracts between two professionals where the subject matter falls outside the solicited professional’s main business activity and that professional employs five or fewer workers — but contracts for “financial services” are expressly carved out. The Court confirmed that the definition of “financial services” is drawn from EU Directive 2011/83/EU of 25 October 2011 on consumer rights (transposed by the law of 17 March 2014), which defines financial services as any service relating notably to banking, credit, investment, and payment.
The Court held that while article L. 311-2 of the Monetary and Financial Code permits financing companies authorised for credit-leasing to carry out ancillary activities such as simple equipment leasing, this does not mean that such a leasing transaction must automatically be classified as a “financial service.” The definition is functional — tied to the nature of the transaction (banking, credit, investment, payment) — not institutional. The mere fact that the lessor is a regulated financing company supervised by the ACPR does not transform an ordinary equipment rental into a financial service.
Accordingly, the financial-services exclusion did not apply, the Consumer Code protections governed the contract, and Mme [E]’s withdrawal was valid. DLL was ordered to pay costs and €3,000 to Mme [E] under article 700 of the Code of Civil Procedure.
Key Takeaways
- The “financial services” exclusion from off-premises and distance-contract consumer protections (transposing Directive 2011/83/EU) is defined by the nature of the service — banking, credit, investment, payment — not by the regulated status of the provider.
- A plain equipment-rental contract concluded by an ACPR-licensed financing company does not become a “financial service” merely because the lessor is also authorised to conduct credit-leasing operations; ancillary activities do not inherit the classification of the principal regulated activity.
- Small professionals employing five or fewer workers benefit from the same statutory right of withdrawal as consumers when they enter off-premises contracts outside their main field of activity, unless a genuine financial-services exclusion applies.
- Lessors and other regulated financiers cannot rely solely on their prudential authorisation to escape consumer-protection rules; the substance of the specific transaction governs.
Why It Matters
This ruling clarifies an important boundary in French consumer and financial law that has practical consequences for equipment-financing companies. Many such firms routinely conclude rental and lease agreements with very small businesses, and they have sometimes argued that their regulated status — as ACPR-supervised financing companies — shields those contracts from the Consumer Code’s withdrawal regime. The Court of Cassation definitively rejects that institutional argument, anchoring the financial-services exclusion in the EU Directive’s functional definition rather than in the identity of the contracting party.
For practitioners advising leasing companies, the decision signals that product design alone — structuring a transaction as a “rental” rather than a credit facility — will not bring the contract within the financial-services carve-out, and that small professional clients may exercise statutory withdrawal rights even years into such arrangements if proper disclosure of those rights was not made at the time of contracting. Conversely, attorneys representing micro-businesses will find in this ruling a confirmed path to unwind off-premises leasing agreements that failed to comply with the Consumer Code’s information and withdrawal requirements.