What are the main characteristics of the French Bankruptcy law?
- France
- 10/31/2000
- J.P. Karsenty et Associés
The main goal of the French Law is to preserve the firm and its employees. The payment of the creditors is secondary.
The French bankruptcy proceedings are opened by the Court, which pronounces either judicial recovery (“Redressement Judiciaire”) or liquidation (“Liquidation Judiciaire”) against tradesmen, artisans, and farmers.
The Court appoints an official receiver (“Juge-Commissaire”) and certain representatives of the Law, such as bankruptcy inspector (“Administrateur Judiciaire”), representative of the creditors (“Mandataire Judiciaire”) and Liquidator.
The judicial recovery of the firm may be achieved either by the reorganization of the structures, or of the capital, or by the sale of the firm.
The creditors may no longer sue the debtor, and they have to file a declaration with the representative of the creditors in a strictly limited period on pain of being foreclosed or the credit being lost. They also must observe limited time period concerning all claim to obtain restitution of goods. The Court, under certain conditions, orders the creditor to continue the contract entered with the debtor in spite of the non-payment of the credit.
