What legal formalities must be accomplished to open a temporary or ‘pop-up’ store?
Organizing a temporary event at a different venue from the main store has become more and more widespread, explaining the rise in ‘pop-up’ stores. Nevertheless, such event-type distribution is not without its own legal framework.
Recently, the Coordination Committee of the Trade and Companies Registry (known as CCRCS in France) esteemed that an ephemeral store set up for a limited term was a secondary establishment within the meaning of the French Commercial Code, the length of time the ephemeral store operates at the chosen commercial venue was considered irrelevant (Notice No. 2015-027).
Consequently, it is advisable:
- either to register an additional establishment at the Paris Commercial Court’s Trade and Companies Register or at the Office for Company Formalities (CFE in France) in which the organizing company is registered during the month prior to setting up the ephemeral store for a limited term. The costs for this formality are EUR 71.11 including VAT. The registration of the additional establishment will be published in a legal gazette (more precisely the BODACC in France),
- or seek the registration of a secondary establishment at the Registry office of the Commercial Court in which the temporary store will be located, if it is located in a different territorial jurisdiction from the main establishment.
The registration of the ephemeral store as an additional or secondary establishment is crucial. The Court of Cassation recently confirmed the prosecution of a company that had refused to accomplish such formality claiming that the store’s business was only temporary (Cass.Crim., 28 March 2017, No. 16–81944).
In the case mentioned above, the director of a company esteemed that the pop-up store open for only six months was not a permanent establishment within the meaning of Section R. 123-40 of the French Commercial Code. Therefore, he considered that he was not obliged to make any notifications. Notwithstanding two inspections by the Social Security Contributions Collections Office (known as URSSAF in France) and a request from the French Labour, Competition and Consumer Department (DIRECCTE in France), the director refused to accomplish an additional registration of the temporary store. He was subsequently convicted for concealed labour due to the failure to make the required notifications.