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Abrupt termination of long-standing business relationships: the legal characterization of the action for damages under review before the CJEU

The ongoing debate on the contractual or tortious nature of the action for damages arising from the abrupt termination of a long-standing business relationship continues to rage among legal scholars and before the courts.

Two recent decisions issued by the Cour de Cassation (French supreme Court) have indeed revived this controversy, which can have very concrete practical implications for business relationships between two companies, especially when they are established in different countries.

Whether the French regime under Article L. 442-1, II of the French Commercial Code may be invoked, the law applicable to the dispute, or the competent court to rule on the damage suffered – these are all questions faced by companies suffering from an abrupt termination of business relationships. And the answers may vary depending on the legal characterization of the action.

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23 October 2025 | Claire Filliatre

International arbitration: balancing legal efficiency and risk management

In today’s global economy, businesses increasingly operate across borders, entering into partnerships with counterparts on multiple continents and negotiating contracts governed by diverse legal systems. These global operations expose them to geopolitical, regulatory, and economic risks that are often difficult to predict.

When disputes arise, domestic courts rarely offer a satisfactory solution: proceedings are lengthy, cross-border service is complex, and the enforcement of judgments abroad remains uncertain.

In this context, international arbitration has emerged as a preferred method for resolving transnational commercial disputes.

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The hoped-for rise of amicable and alternative dispute resolution methods in France

The protracted length of proceedings before traditional courts, heavily impacted by a chronic shortage of resources and judges allocated by the State, the rapid expansion of digital tools and the digitalization of exchanges, and the impact of the health crisis with its restrictions on movement, have all combined to encourage a growing number of French businesses to turn to arbitration, mediation, or conciliation.

Parties may resort to what are now commonly referred to as amicable dispute resolution methods (modes amiables de résolution des différends or MARD in French), either prior to the initiation of court proceedings or at any time thereafter.

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