The French Government extends exceptional insolvency measures related to the COVID-19 crisis up to the 31st December 2021
Many of the measures of the French Ordinance No. 2020-596 of 20 May 2020, adapting pre-insolvency and insolvency French rules in response to the consequences of the Covid-19 pandemic, were due to expire on 31 December 2020.
The French law on Acceleration and Simplification of Public Action n°2020-1525 of 7 December 2020 now extends them until December 31, 2021.
The extended measures are as follows:
- The reinforcement of the statutory auditor role as a whistleblower (the statutory auditor can warn the president of the Commercial Court directly of the existence of difficulties without delay);
- Increased protection of the debtor in conciliation (the creditor who does not suspend action during the conciliation procedure may be prohibited from taking such action or any means of enforcement by the president of the Commercial Court);
- The extension of the accelerated safeguard proceedings (or “S.F.A”) to small businesses (the minimum thresholds being 20 employees, €3 million in turnover or €1.5 million in balance sheet to allow the debtor to apply for accelerated safeguard proceedings);
- The possibility of extending continuation / safeguard plans up to 12 years (compared with 10 years previously);
- New "post-money" privilege (cash contributors during the insolvency proceedings can benefit from an additional guarantee in the event of subsequent liquidation).
On the other hand, the most controversial measure of the Ordinance of 20 May 2020, namely the possibility to sell the insolvent company as a going concern to its management, will come to an end on 31 December 2020.
News & Insights
What does the Brexit Deal mean for the Construction Industry? Still some serious snagging issues
As the UK leaves the European Union, what does it mean for the Construction Industry?
“Subject to contract” wording in settlement negotiations: a label that sticks
Durra looks at the term “subject to contract” and how it was put to the test in Joanne Properties Ltd v Moneything Capital Ltd and another.
Charles Russell Speechlys continues international expansion with the hire of four new partners
We are delighted to announce the hire of four new partners across four of our offices.