Bankruptcy Law

If some managers are not aware of the difficulties their companies are facing, others seem to ignore them to the point of delaying sometimes difficult decisions. The failure of the manager, whether intentional or unintentional, may lead to the opening of amicable or legal proceedings, often too late. This behavior must not affect the rights of third parties, who must be able to obtain all informat …

Legal Registers

Several categories of companies are required to file their annual accounts and other ancillary documents with the Registrar of the Commercial Court. This legal procedure contributes to the faithful and sincere presentation of the assets, the economic and financial situation and the accounting result of the company and to the information of its current and future partners on its financial health. 

The companies covered by the obligation to file their annual accounts are limited liability companies, single-member limited liability companies, joint stock companies (SA, SAS, Sasu and SCA), general partnerships (SNC) where all the partners (with unlimited liability) are themselves limited liability companies or joint stock companies and/or SNCs or limited partnerships (SCS) where all the partners are limited liability companies or joint stock companies, liberal practice companies (Selarl, Selafa, Selca and Selas), commercial companies whose headquarters are located abroad and which have opened one or more establishments in France, and companies known as “European Companies” which have their headquarters in France . Individual entrepreneurs (merchants, craftsmen, liberal professions), on the other hand, are not concerned by this obligation. Individual entrepreneurs with limited liability (EIRL) are required to file their annual accounts with the register where their declaration of assets and liabilities  was filed. Micro-enterprises are also required to publish their accounts but have a confidentiality agreement .

Despite the mandatory nature of the filing of annual accounts, it must be noted that a large majority of companies do not comply with this obligation, regularly invoking the concern not to reveal confidential information to their competitors , whereas such a failure is punishable by a penal  sanction. This is why, in 2001 , the legislator allowed any interested party  and the Public Prosecutor's Office  to refer the matter to the president of the court, so that the latter may order the directors to file the documents and acts in question with the trade and companies register, subject to a fine. The president of the court may, under the same conditions and for the same purpose, appoint an agent to carry out these formalities.

When the obligation to file the corporate accounts is not met within the legal time-limits, Article L. 611-2, II of the Commercial Code provides that the president of the court, who is informed by the registrar of the court , may ex officio issue an injunction to the directors to file the accounts within a short period of time, subject to a penalty. This power is not subject to a prior summons of the director, within the framework of the warning power conferred upon him by Article L. 611-2 of the Commercial Code .  The order, which is signed by the court registrar  under penalty of nullity, sets a time-limit of one month from the date of notification or service to file the accounts. It sets the rate of the penalty payment and mentions the place, day and time of the hearing at which the case will be examined . The power of injunction of the president of the court was declared to be in conformity with the Constitution, since the possible infringements of the principles of freedom of enterprise and equality before the law are in the general interest of economic transparency and are not disproportionate .

If the injunction is not complied with, the court registrar records the failure to file the accounts by means of a report  and the president of the court decides on the liquidation of the penalty payment . On the other hand, when the injunction has been complied with within the time-limit, the case is removed from the role .

Commercial Code, Art. L. 232-21 to L. 232-23.

Court of Cassation, 29 September 2009, LawLex202100005472JBJ.

Court of Cassation, 15 January 2013, LawLex202100005502JBJ, (rejection of a request to transmit a QPC to the Constitutional Council).

See in particular CA Rennes, Judgment of 21 February 2017, LawLex202100005501JBJ, noting instead that the distortion of competition comes from undertakings that do not publish.

Commercial Code, Art. R. 247-3: “Failure to comply with the filing obligations provided for in Articles L. 232-21 to L. 232-23 is punishable by the fine provided for in Article 131-13 of the penal code for fifth class contraventions (minor offense). In the event of a repeat offense, the applicable penalty is that provided for in Article 131-13, fifth paragraph of the Penal Code for fifth-class contraventions committed in a repeat offense”, and Penal Code, Article 131-13: “1,500 euros at the most for fifth-class contraventions, an amount that may be increased to 3,000 euros in the event of a repeat offense when the regulations so provide, except in cases where the law provides that a repeat contravention constitutes an offense”.

Law No 2001-420 of 15 May 2001, known as the NRE law.

CA Poitiers, 18 January 2011, LawLex202100005468JBJ, holding that there is no need to justify a legitimate interest and Court of Cassation, 3 April 2012, LawLex202100005466JBJ.

Court of Cassation, Art. L. 123-5-1; for an application see CA Douai, 30 October 2012, LawLex202100005470JBJ.

See CA Rennes, 21 February 2017, LawLex202100005501JBJ, cited above.

Mandatory filing of annual accounts

If some managers are not aware of the difficulties their companies are facing, others seem to ignore them to the point of delaying sometimes difficult decisions. The failure of the manager, whether intentional or unintentional, may lead to the opening of amicable or legal proceedings, often too late. This behavior must not affect the rights of third parties, who must be able to obtain all information enabling them to assess the appropriateness of continuing the relationship with the company. In fact, the sources of information on the situation of companies are varied and are based for the most part on the diverse provisions that institute legal publicity obligations for certain acts.

The registrars of the commercial courts keep the “register of commerce and companies” ("registre du commerce et des sociétés"), some of whose information can be consulted on their websites, which include, in particular, the “Kbis extract”, which acts as an up-to-date identity card for the company , a statement of indebtedness, which provides information on the financial health of the company, the company's articles of association and any amendments thereto, the annual financial statements and, where applicable, any collective proceedings initiated against the company. In addition, tools are available to monitor a company and track all administrative and financial events affecting it .

In addition to this register, third parties or partners can also consult the land registry, which lists all the securities constituted on a building. The register of liens and securities, also kept by the registrar of the Commercial Court, lists the liens of the social security and supplementary funds and of the public treasury and is a valuable indication of the payment incidents that have occurred during the company's activity. Other registrations, also entered in this register, show the amount of money owed by a company to its creditors and make it possible to assess its level of indebtedness. This is the case of the seller's lien on a business, pledges of business assets, pledges on tools and equipment, pledges on shares in non-trading companies, leasing transactions in the area of movable property, rental contracts and sales contracts with a reservation of ownership clause, and protests and certificates of non-payment of checks. The registrar's office of the Commercial Court keeps another register that may be useful to consult: the register of pledges, which lists inventory pledges and non-possessory pledges.

In addition, some financial institutions have access to sensitive financial information on companies . This information, which comes from the companies themselves, the courts, INSEE and economic financing actors, is, however, not widely available .

The Kbis mentions the following information: the name of the registry office, the company name, the acronym, the sign, the identification number (formerly SIREN number), the legal form (SARL, SA, GIE, SCI... ), the currency and the amount of the share capital, the address of the headquarters, the duration of the company, the date of incorporation, the NAF code, the detailed activity, the address of the principal place of business, the function, the name, first name, date of birth, commune of birth, nationality and address of the principal manager, the directors and the auditors.

For examples of accessible information: change of director, modification of the activity, opening or conversion of a procedure, filing or not of annual accounts, etc.

Monetary and Financial Code, Art. L. 144-1: "The Banque de France may enter into direct contact with companies and professional groups that are willing to participate in its investigations. These companies and professional groups may provide the Banque de France with information on their financial situation. The Banque de France may communicate all or part of the information it holds on the financial situation of companies to other central banks, to other institutions entrusted with a mission similar to those entrusted to it in France and to credit and financial institutions. It may also communicate this information to insurance companies authorized, under the conditions provided for by the Insurance Code, to carry out credit insurance or bonding operations in France, provided that their interventions are aimed at companies.

It establishes in advance the procedures for communicating this information and sets the reporting obligations of these companies. The risk rating methods and models of these companies are transmitted to the French Prudential Supervisory Authority".

Bankruptcy Law

11. Legal Registers

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Les notions juridiques connexes

11. Legal Registers

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Les notions juridiques connexes

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