French lawyers are free to determine the amount of fees they charge for their services, and they are under no legal obligation to limit or cap the amount of their fees.
The rates applied by French lawyers may vary significantly from one firm to another or even among lawyers practicing within the same law firm. Their amount depends on the area of law practiced by an attorney, his/her experience, reputation, and agreement with the client.
The fees charged by a lawyer must be agreed with the client
A lawyer may apply an hourly rate, a flat fee or agree with the client a subscription for certain recurrent services.
Legal fees based exclusively on success (“no win – no fee”) are prohibited by French law.
In all events, a lawyer must be transparent with his/her clients on the amount of fees which will be charged.
As recalled by the French National Bar Council (“Conseil National des Barreaux”), the fees charged by lawyers should not be a taboo, and your lawyer has a duty of information and transparency regarding the cost of his/her service.
It should be also noted that the fees charged by French lawyers do not reflect the amount of money that they effectively earn. Indeed, and as recalled by the French National Bar Council, only a small fraction of a lawyer’s gross revenue constitutes remuneration, due to significant and numerous taxes and contributions which French lawyers are obliged to pay.
The application of an hourly rate (i.e., billing on the basis of time spent) constitutes the most frequent price modality applied by French lawyers.
Hourly rates vary from 250€ to 350€ for small boutique business law firms and may reach up to 900€ or more for services provided by partners in certain international law firms.
The application of an hourly rate may be combined with a success fee, which enables a client to pay a lower hourly rate in the event that a transaction or litigation does not succeed, in consideration for a success or contingency fee in the event that it does.
Certain lawyers accept to be paid a flat fee for certain services (such as, drafting of an agreement or other legal documents). In most cases, a flat fee may be agreed when a lawyer is able to anticipate the amount of time which will be necessary to provide the requested services.
The services to be provided by a lawyer in consideration for a flat fee are generally described in the lawyer’s engagement letter, and may be conditioned on the client complying with the initial instructions given to the lawyer.
Thus, if a flat fee has been agreed, for example, for the drafting of a legal document, an additional fee may have to be agreed with the lawyer for the negotiation of the document, as it is often impossible to assess how simple or complicated a negotiation will be…
Success and contingency fees
In France, and contrary to certain Anglo-Saxon countries, the so-called « pacte de quota litis » (« no win no fee agreement ») is prohibited.
It is however possible to agree with a lawyer a contingency or a success fee, which must however be combined with another method of remuneration (such as a flat fee or a lower hourly rate).
A contingency or success fee may be a lump-sum amount or an amount proportionate to the amount of financial interest at stake.
If you need the services of an attorney frequently, you may agree with your lawyers to pay (monthly or quarterly) a subscription fee in consideration for the provision of day-to-day assistance on certain matters (such as corporate formalities, employment matters, taxation, …).
The services provided by attorneys pursuant to such agreements generally do not comprise fees payable in relation to non-recurrent matters, such as an important transaction or litigation.
Taxes, costs and disbursements
The provision of legal services in subject, in France, to VAT, which lawyers are obliged to apply.
In addition, lawyers are also entitled to reimbursement of the costs and disbursements they have incurred on behalf of a client (stamp and registration duties, postage costs, fees and costs payable to third parties, such as experts, bailiffs, travel costs, etc.)
In most cases, lawyers apply a retainer fee. After the case is closed, the amount of retainer fees is deducted from the total amount of outstanding fees.
What should you do if you and your lawyer disagree on billing?
French law (Decree of 27 November 1991) provides for a very simple and efficient procedure.
You should submit your claim to the President of the competent Bar (by registered letter with return of receipt).
The President of the Bar must examine your claim within a maximum period of 4 months (renewable once).
If no agreement is reached between you and your lawyer, the President of the Bar will render a decision, which will be notified to you and your lawyer.
The decision is subject to appeal before it becomes enforceable.