Legislative change could threaten cross-Channel legacies

New legislation in France could limit the ability of British testators to leave French assets to UK charities in their wills, lawyers have warned.

New legislation in France could limit the ability of British testators to leave French assets to UK charities in their wills, lawyers have warned.

The law, passed earlier this month, could leave charities in a position where their legacy gifts are challenged by the children of the deceased.

Previously, European Succession Regulation that had been in place since 2015 allowed testators the option of choosing the law of their own nationality to apply to their French assets.

This had the effect of bypassing local French forced heirship rules, under which children are automatically entitled to a share of their parents’ estates.

Because laws in England and Wales provide testamentary freedom, it was possible for English and Welsh testators with assets in France to exclude their children from their wills completely if they wished – for example by leaving everything to their spouse, or to charity, instead.

But under a new law, Article 913 of the French Civil Code, a child who does not inherit the amount dictated by the French forced heirship rules can claim compensation to be made out of the French assets – effectively superseding any election of law made in the will, lawyers said.

To bring such a claim, the deceased or at least one of their children must have been either EU nationals, or habitually resident in the EU.

This excludes estates of British nationals resident in the UK with holiday homes or other assets in France, if the children are also UK nationals and UK resident.

The law firm Stone King said uncertainty remained as to how the new law would be applied in practice.

Dan Harris, a partner who heads Stone King’s international and cross-border team and the firm’s charity legacy team, said: “Our view is that this law is contrary to the principles of the European Succession Regulation and indeed the ‘free market’ principles of the EU itself, and we believe that ultimately it will be successfully challenged at a European level, but this will take many years.

“In the interim, charities entitled to a legacy of French assets should be aware that their entitlement may be affected if the children of the deceased are able to bring a claim under the new law.

“It is difficult to estimate the scale of the issue, but at Stone King we help our charity clients with a constant stream of matters where French assets are left to UK charities every year and the value of these assets can be considerable.

“Across the country, there are hundreds of these cases.”

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