Islanders with French homes should review wills after EU change – legal expert

Monday 30 November 2015

Islanders who own French property may need to revise their wills in the light of changes to EU succession rules.

Changes to EU rules came into force in August, and a Jersey expert in succession planning and French tax law says that it will affect all Islanders owning property in France.

Peter Harris, an English Barrister practising at Overseas Chambers, says that the new rules mean that inheritance of French property is now governed under the laws of the ‘habitual residence’ of the deceased at the time of their death.

That is the automatic or default law which applies for example in intestacy and also where no option for the law of the nationality of the individual concerned has been made in a will to govern their whole succession.

Where Islanders have written their wills in line with French law, that means they need to revise the arrangements – because the change means that the wills and inheritance are now governed by the Jersey laws of succession.

Mr Harris attended a European Commission conference in Brussels this month at which the rules were discussed, and was involved in debates with delegates from Italy and France. In particular, he obtained agreement as to the restrictions on the application of a concept known as renvoi within the Regulation.  Effectively French law can now be excluded in several ways.  He also obtained a retraction from an Italian speaker who contended that you cannot opt for the law of your nationality if you were habitually  resident in that state.  It is clear that the option available is one aspect of obtaining certainty for the European citizen, rather than the uncertainty.

He says that it is clear that the impact of the new rules mean that wills over all types of French property will have to be reviewed.

He said: “It is essential therefore if you have matrimonial ‘form’, and wish to leave your share to your later spouse, to exercise the option in a new will opting for your nationality i.e. British - Jersey.

"That avoids any renvoi [reversion] to French law. It is necessary to decide which part of the British Isles is your nationality for these purposes.

"Any will drafted on the basis of the law prior to the unitary system imposed by the Regulation as from 17 August 2015 will now need review.”

The Regulation does not affect matrimonial property régimes, for which a draft regulation is also being prepared. Unlike the Succession Regulation, that draft contains an article validating existing régimes. 

The UK opted out of the changes to succession rules, but Mr Harris says that ‘opt-out’ only means that the United Kingdom is not required to apply the Regulation in its jurisdiction, neither is Jersey, and it is not part of the arrangements the Island is required to implement under the Treaties. However the French notary will apply the Regulation to assets in France and can no longer apply French law to them if there is a will opting for Jersey law.  

He says that Channel Islanders can acquire residences as European Citizens in the EU and therefore are entitled to leave them to whoever they want in their wills, using the new rules as to planning and certaintywhich are there for their benefit. However care needs to be taken with French succession duties which remain the same, and are not changed by the Regulation.