Device operation

The ARO is a scheme that only micro-enterprises can benefit from. It allows a micro-enterprise to occupy premises for commercial or professional use against payment of a fee to a land tenure organization (FSO), the lessor of the contract.

The FSO is free to establish eligibility criteria for the micro-enterprise that will hold the SAB. The implementing decree specifies these criteria:

• the turnover or the financial position of the company ;
• theeffective company and its recruitment policy (it is possible to take account of the measures taken by the company to promote the integration into employment of people in difficulty);
• the type of activity the company (assessed according to the needs of the neighborhood or the layout of the premises, its conditions of access or use);
• the specification of an authorized destination or activity(ies) and, where appropriate, ancillary activities which may be carried out in the premises;
• the accolades available to the company (in particular for micro-enterprises in the social and solidarity economy).

The lease agreement shall specify the destination of the premises and the authorized activity or activities. Any change of destination is subject to the prior agreement of the FSO, which will be requested within one month before the change.

From a tax point of view, work carried out under an ARO is subject to the reduced rate of VAT.

Obligations of the micro-enterprise

The micro-enterprise, the lessee of this lease, must:

• occupy and operate the premises without renting it ;
• to pay a fee to the FSO (it consists of a fixed and a variable share, as defined in the lease agreement). The fixed share must be reviewed every three years and the variable share may be adjusted according to the trend observed in the profits of the micro-enterprise over the last three years. It is not possible to waive this fee;
• pay rent. The rent also includes a fixed share revised every 3 years and a variable share calculated according to the evolution of the profits of the microenterprise over the last 3 years;
• where appropriate, carry out construction or rehabilitation work on the premises provided for in the lease. The micro-enterprise may also carry out the work necessary for the preservation of the asset in good condition for use;
• to keep in good serviceability and repairs to existing structures at the time of the conclusion of the lease;

Possibility of transfer of rights in rem in immovable property

It is possible for the micro-enterprise to assign real estate rights to the premises subject to the lease. This sale or donation must be the subject of a prior offer of assignment or donation which must mention:

• the temporary nature of the right in rem;
• the date on which the right in rem expires;
• the new duration of the actual joint and several activity lease if the joint and several property organization (FSO) approves it;
• the conditions for issuing this authorization by the FSO;
• the arrangements for calculating the sale price or the given value, as laid down in the lease.

In addition, the micro-enterprise must inform the FSO of its intention to transfer the rights in rem in immovable property it holds from its ARB within 30 days of receipt of the acceptance of the prior offer of transfer or donation. The licensee must also seek the agreement of the FSO of the assignment or donation.

When the FSO approves the lease, the duration of the lease is extended to allow the new lessee to benefit from a right in rem for a duration equal to that provided for in the original contract. In the event of a refusal of approval, the FSO may designate a purchaser who meets the acquisition conditions.

If the parties fail to reach an agreement within 6 months of the transferor's request, the ARO may be terminated by agreement and the micro-enterprise may be compensated for the value of its rights in rem in immovable property.

Finally, we can add that the FSO has a right of pre-emption in the event of any assignment or donation. It may therefore buy back the rights in rem in immovable property relating to the premises or have them acquired by a beneficiary satisfying the conditions for acquisition. The FSO must inform the public of its decision to exercise its right of pre-emption within two months of the transmission of the prior offer of assignment or donation (this period is extended by one month in the case of refusal of authorization).

Duration and end of the lease

The actual joint and several activity lease contract may be signed for a period of between 12 and 99 years.

The contract expires at the end of the lease and the micro-enterprise is not entitled to any right or title of occupation against the FSO.

In the event of the death of the lessee, of the transfer of the professional assets of the sole contractor or of the transfer of the affected assets of the sole contractor with limited liability, the rights in rem relating to the premises covered by the ARBU shall be transferred to the person entitled.

If the latter is not eligible for the lease, he will have 12 months to transfer the rights in rem relating to the premises covered by the ARBU to an eligible purchaser approved by the FSO.

If the assets are not transferred within this period, the SRB will be terminated and the successor in title will be compensated by the FSO for the value of the rights in rem in immovable property.