The penalty clause & withdrawing from the sale

You are able to withdraw from the sale for no reason within your 7 day cooling off period (the seller is not allowed to do the same) and you can also annul the sale should any of the suspensive clauses not be met eg you do not obtain your mortgage.

However, should the buyer or the seller decide to withdraw from the sale even if all of the  conditions precedent in the contract have been met,  then a penalty fee (which is agreed upon at the signing of the preliminary contract) of approximately 10%  of the purchase price, will be due by the party making the decision to withdraw in favour of the party wishing to remain in the sale. Furthermore, the party wishing to proceed with the sale can also enforce the sale to go through via the French courts. This is quite a lengthy procedure and can take  up to several years.

It should be noted that if an amicable agreement to retract from the sale has been reached when all the conditions precedent have been met then the estate agent will still be entitled to the commission, and this can be paid by either the buyer or the seller.