Exclusive mandate

An exclusive mandate (mandat exclusif in French) is the contract in which the owner of an asset entrusts a single intermediary, for a fixed period, with finding a buyer and negotiating the sale. While it runs, the owner undertakes not to give the same assignment to another intermediary. Depending on its wording, the owner may also undertake not to sell directly.

Legal framework

In France, a mandate to sell a property or a business (fonds de commerce) falls under the loi Hoguet and its implementing decree of 20 July 1972. It must be in writing and signed before any work begins, limited in time and entered in the intermediary’s register of mandates, whose number appears on the owner’s copy. It sets the fee and states who pays it. The exclusivity clause must be clearly highlighted, and the decree governs how it can be terminated after an initial period.

In a transaction

In the hotel sector, exclusivity serves confidentiality first. A hotel presented by several intermediaries circulates quickly, sometimes at different prices, and buyers notice. A single intermediary controls the list of recipients, the content of the documents and the timetable. It can also commit to the preparatory work (valuation, memorandum, data room) that a file presented to institutional buyers requires.

The mandate usually specifies:

• what is being sold: property, business or shares
• the asking price
• the term and termination conditions
• the fees and which party bears them
• how the intermediary reports to the owner

Not to be confused with

• A simple (non-exclusive) mandate, which leaves the owner free to appoint several intermediaries and to sell alone.
• A search mandate, given by a buyer rather than a vendor.

Fees are set in the mandate in line with our fee schedule.