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Corporate Insolvency in France
We advise German, Austrian and Swiss companies and their French subsidiaries on all issues relating to economic distress in France, including insolvency. We can provide consulting services in German, French or English.
In France, the directors of a distressed company are required to apply for insolvency to the competent French court within 45 days of the occurrence of insolvency (cessation des paiements).
Ideally, this notification would be accompanied by a request for the most appropriate insolvency proceedings under French law for the specific case. There are five different insolvency proceedings or pre-insolvency protection proceedings in France. Two of the best known of these are the French liquidation procedure (liquidation judiciaire) and the French reorganisation procedure (redressement judiciaire). The decision as to which procedure under French insolvency law is best suited for achieving the economic objectives of the parent company and the managing directors and which procedure is most effective in reducing liability risks must be examined specifically on a case-by-case basis.
Our insolvency law team with intercultural experience will inform you about all of the relevant legal and practical issues in France and then give you clear guidance on the best course of action.
Our Services relating to French Insolvency Law
Unser deutsch-französisches Team bietet Ihnen neben der Rechtsberatung auch praktische Unterstützung bei folgenden Themen in Frankreich:
- Analysis of the status quo of the financial and economic data of your French company
- Analysis of the links between the French subsidiary and the foreign parent company and the assessment of liability risks under French law
- Selection of the appropriate type of French insolvency proceedings
- Recommendation of concrete measures in advance of insolvency proceedings in France
- Alternatives to filing for insolvency proceedings under French law
- Insolvency petition in France by writ to the competent French court
- Oral proceedings before the French regional court (tribunal judiciaire) (Alsace and Moselle) or the French commercial court (tribunal de commerce) (rest of France)
- Communication with the court-appointed insolvency administrator in France to coordinate the course of action, in particular to safeguard the rights of managing directors and parent companies in Germany, Austria or Switzerland
- Consulting and negotiation in the purchase or sale of companies experiencing financial difficulties in France
- Filing of claims in France
- Enforcement of rights under retention against French litigants
- As needed: Sworn translations of German and French documents
Contact Partners for French Product Insolvency Law
Did you know that in France…
- insolvency courts in France are composed almost exclusively of judges who have not studied law? Only in the regions of Alsace and Moselle does one find a professional French judge on the bench.
- in the event of the insolvency of a French company, the liquidator in France first seeks to dispose of the so-called fonds de commerce (= the French company’s business operations consisting of the company’s clientele and its commercial lease, goodwill) in a single transaction so that the company can continue to operate?
- the managing director of a French company can be sued for damages (compensation for deficiency of assets) if it can be demonstrated that he/she has committed errors in management?
- the (foreign) parent company is liable for damages in France if it can be demonstrated that it has given so-called “abusive support” (soutien abusif) to its French subsidiary?
- where employees are dismissed in the context of French insolvency proceedings, the statutory rights of employees are settled by the French state insolvency funds?
- when a company in France, which is experiencing financial difficulties, is acquired, under French law, the acquisition is, in principle, not encumbered by existing debts?
- the procedure for dismissing employees takes an extremely formalistic approach and the provisions of French labour law must be strictly observed in order to avoid large claims for damages?
Our German-French Team for Corporate Insolvency in France