Bankruptcy Law

Article L. 611-8 of the Commercial Code provides that the president of the court, upon the joint request of the parties, may record their agreement and give it enforceability. According to Article R. 611-39, the ordinance of the president of the court is enforceable, which allows one of the parties, in the event of non-performance of the agreement by the other, to bring the matter before the court …

Procedural Framework

Article L. 611-8 of the Commercial Code provides that the president of the court, upon the joint request of the parties, may record their agreement and give it enforceability. According to Article R. 611-39, the ordinance of the president of the court is enforceable, which allows one of the parties, in the event of non-performance of the agreement by the other, to bring the matter before the court in order to force it to be performed. The president of the court notes the agreement of the parties provided that the debtor attests, by a certified declaration, that he was unable to meet its liabilities at the time of its conclusion or that this agreement puts an end to it. This certified declaration is attached to the ordinance . The decision establishing the agreement is not subject to publication and is not subject to appeal. It terminates the conciliation proceedings . If the agreement and its appendices are filed with the court registrar's office, copies may only be issued to the parties and to those persons who can rely on its provisions.

Article L. 611-8 makes the approval of the agreement subject to the fulfilment of three cumulative conditions: (i) the debtor must not be in a state of suspension of payments or the agreement concluded must put an end to this state; (ii) the terms of the agreement must be such as to ensure the continuity of the business of the company and (iii) the agreement must not harm the interests of non-signatory creditors. The debtor must inform the social and economic committee (comité économique et social) of the content of the agreement when its homologation is requested . The court decides on the homologation after having heard or duly called in court chambers the debtor, the creditors who are parties to the agreement, the person or persons designated by the social and economic committee, the conciliator and the ministry of public affairs, as well as the professional order or the competent authority to which, if applicable, the debtor belongs if he practises a liberal profession subject to a legislative or regulatory status or whose title is protected. The court may also hear any other person whose hearing it deems useful . The persons called to the homologation hearing may examine the agreement at the court registry (greffe du tribunal) . The registrar of the court notifies the judgment that rules on the homologation of the agreement to the debtor and the signatory creditors. It is also communicated to the conciliator and the public prosecutor . To ensure the confidentiality of the procedure, the judgment does not include the terms of the agreement. It only mentions the guarantees and privileges constituted to ensure the performance of the agreement and specifies the amounts guaranteed by the lien instituted by Article L. 611-11 . Where this is not the case, a creditor may appeal the judgment of homologation in order to have these details included . The judgment of homologation is then subject to publicity measures. Indeed, a notice of the judgment of homologation is sent for insertion in the Bulletin officiel des annonces civiles et commerciales. This insertion contains the name of the debtor, his jurisdiction or, if he is a natural person, the address of his business or activity. It shall also mention his unique identification number and, where applicable, the name of the town where the registry or the chamber of trades of the region where he is registered is located. Where the activity in difficulty is one to which an individual entrepreneur with limited liability has assigned assets, the insertion shall specify the register where the declaration of assignment was entered. The same notice shall be published in a legal notice medium of the place where the debtor has his jurisdiction or, where he is a natural person, corresponding to the address of his business or activity. It shall mention that the judgment is deposited at the registry where any interested party may consult it. These notices, which are made ex officio by the court registrar within eight days of the date of the judgment , relate to the judgment itself and not to the content of the agreement. Finally, when the debtor is subject to a legal audit of its accounts, the approved agreement is sent to its statutory auditor .

CA Rennes, 1st December 2015, LawLex202100003614JBJ.

Bankruptcy Law

30. Procedural Framework

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30. Procedural Framework

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