TLDR: Public sales are sales of movable property (goods, effects, movable objects) carried out publicly and by auction, with advertising and competitive bidding, in the presence of authorised public officials, sworn merchandise brokers or declared voluntary operators of public auction sales of movable property. They are subject to registration duty and must be recorded in a minute of adjudication. Their tax treatment involves a registration obligation under penalty of fines, and a specific VAT regime for works of art, collectibles or antiques.
Definition and legal framework
Public sales refer to sales of tangible movable property (goods, effects, movable objects) organised publicly and by auction, with advertising and competitive bidding. They must be conducted in the presence of:
- authorised public officials (e.g. bailiff, auctioneer),
- sworn merchandise brokers,
- or declared voluntary operators of public auction sales of movable property.
These sales may be voluntary (organised by authorised private operators, notaries or judicial offices) or judicial. Online auctions are assimilated to public sales if they comply with the adjudication rules of the best bidder (highest bidder) and involve the intervention of a third party to propose and adjudicate the property.
Exclusions from the scope of public sales
The following are not considered public sales:
- auction brokerage operations conducted remotely (e.g. online) if they do not include adjudication to the best bidder nor the intervention of a third party for the description of the property and the conclusion of the sale;
- sales of businesses, customer bases, assignments of lease rights, ministerial offices, shares or company interests.
Registration obligation
Public sales of tangible movable property (e.g. goods, objects) must be mandatorily registered with the competent tax office, either the one of the operator's residence or the one of the place where the sale is held. This obligation applies to:
- public officials (e.g. bailiff, auctioneer),
- sworn merchandise brokers,
- declared voluntary operators who conducted the sale.
Failure or delay in registration results in the application of:
- late payment interest (Art. 1727 of the French Tax Code);
- a surcharge (Art. 1728 of the French Tax Code).
Content of the sales minute
The minute must contain, for each adjudicated item:
- the description of the property;
- the price, written in words and figures, highlighted separately;
- the signature of the public official or authorised operator at the end of the session;
- where applicable, a note that the sale takes place following an inventory, with indication of the date, the notary's name and the registration receipt.
VAT treatment of public auction sales
For works of art, collectibles or antiques sold at public auctions, the applicable VAT regime is that of second-hand goods, with the specific sectoral rules for these categories. Public sales of these items are subject to VAT when the seller is a taxable person (e.g. dealers, art galleries).
Penalties and fines
Omission or delay in registering the public sale minute results in tax penalties:
- late payment interest (legal rate);
- surcharge of 10% to 80% depending on the duration of the delay and the taxpayer's good faith.