Cass. com., 19 March 2025, No. 23-23.507, published in the Bulletin

In a ruling dated 19 March 2025, the commercial chamber of the Court of Cassation confirmed the absence of a suddentermination in the context of a progressive decrease in business volume over a very long notice period. It thus provides an important clarification on the assessment of the ‘particular circumstances’ that may justify a change in commercial conditions during the notice period.

The context: 23 years of commercial relationship between Sport Elec and Decathlon

Sport Elec, a manufacturer of electrostimulation devices, had had a commercial relationship with Decathlon for more than twenty years.

In an initial letter dated 27 June 2017, Decathlon informed its supplier of a 15% drop in activity for the year 2018.

On 26 January 2018, Decathlon informed Sport Elec of its intention to terminate their relationship as of 1 January 2021, announcing a gradual reduction in its purchases during the 35-month notice period: €800,000 in 2017, €600,000 in 2018, €500,000 in 2019, then €200,000 in 2020, followed by a complete halt in 2021.

Sport Elec considered that this gradual decrease constituted a sudden termination in the established commercial relations and sued Decathlon for damages.

The question raised was the possibility of gradually decreasing the activity during this notice period.

The Court validates the method of termination: long notice period and early decrease

The Court of Cassation rejected Sport Elec’s appeal and confirmed the analysis of the Court of Appeal.

It reiterates that while, in principle, the terms of the relationship must be maintained during the notice period, non-substantial changes are permitted, and above all, ‘special circumstances’ may justify an adjustment to the notice period, even if it greatly exceeds the practices of the sector.

The Court of Cassation points out that « the notice period granted following the termination of an established commercial relationship must be effective, so that, except in special circumstances, the commercial relationship must continue under the previous conditions during the notice period, which implies that any changes made to it must not be substantial.’

The Court of Cassation then ruled that this reduction in activity was not sudden because in this case:

• The notice period granted (35 months) exceeded by more than two years the duration considered reasonable by the profession (10 months according to custom).
• The first decrease (15% in 2018) was not substantial.
• The progressive decrease in orders was announced from the outset.
• There was no exclusivity or specific investment, and Sport Elec’s commercial dependence (24% of turnover) was not considered excessive.

A pragmatic approach to the legal regime

The Court thus validates the process adopted by Decathlon to end these long-standing commercial relations:

– Prior information provided in advance with a precise timetable,

– A reasonable and staggered reduction in activity,

– The proportionality of the successive reductions in activity.

This ruling is part of a pragmatic case law which, without renouncing the protection of the ousted partner, recognises the possibility of a gradual exit from the relationship when it is anticipated, proportionate and in accordance with custom.

By Olivier Vibert,

Lawyer at the Paris Bar

Kbestan – business law firm in Evreux and Paris

www.kbestan.fr