Bankruptcy Law

In order to promote access to credit for businesses, even when they are experiencing difficulties, Article L. 622-28(1) of the Commercial Code , excludes from the rule of the suspension of the accrual of interest, interest resulting from loan contracts concluded for a term equal to or greater than one year  or contracts with a deferred payment of one year or more, even if they have been terminated …

Scope of the exception

In order to promote access to credit for businesses, even when they are experiencing difficulties, Article L. 622-28(1) of the Commercial Code , excludes from the rule of the suspension of the accrual of interest, interest resulting from loan contracts concluded for a term equal to or greater than one year  or contracts with a deferred payment of one year or more, even if they have been terminated before the suspension . The text provides that natural persons who are co-obligated or who have granted a personal guarantee or who have assigned or transferred an asset as security may avail themselves of this right.

The exception applies to both statutory interest and contractual interest on arrears . In the absence of any distinction provided for in the text, the rule applies whether or not the loan contracts in question are in progress on the date on which the receivership is opened . A creditor who has granted the debtor a loan for a period of at least one year prior to the insolvency procedure, and for whom the continuation plan imposes longer repayment periods than those provided for contractually, is entitled to payment of the interest provided for in the contract by reason of the extension of these periods .

Which loan agreements are covered by the exception? The Court of Cassation may have appeared hesitant as to the assimilation of a credit facility to a loan agreement as regards the benefit of the exception to the rule of the suspension of the accrual of interest: While it initially assimilated a credit facility to a loan agreement , it then rejected this assimilation , before returning to its initial position and considering that when it is granted for a period equal to or greater than one year, the credit facility from which the debtor benefits can be assimilated to a loan for the application of Article L. 622-28 . However, the exception does not apply to leasing contracts, so that a lessor cannot order the debtor's guarantor to pay contractual interest . Similarly, a current account agreement that provides neither the period for which the funds are made available nor the terms of repayment does not constitute a loan of more than one year within the meaning of Article L. 622-28 . Furthermore, amendments to a loan contract concluded for a period of six months, which grant three successive extensions of the period offered to the debtor for its repayment, cannot give it the character of a loan concluded for a period equal to or greater than one year, in the light of the provisions of Article L. 622-28 .

Lastly, a penalty clause which penalises late payment and provides for increased interest in relation to that resulting from a loan concluded for a term equal to or greater than one year, applies, subject to the court's power of moderation, even in the event of the opening of an insolvency procedure against the borrower .

Applicable to the receivership procedure by reference from art. L. 631-14 C. com.

Cass. com., 4 April 2006, LawLex202100002799JBJ (RJ) ; 9 June 2021, LawLex202200008075JBJ (LJ).

Cass. com., 23 April 2013, LawLex202100002771JBJ (RJ).

Cass. com., 29 April 2003, LawLex202200002765JBJ (RJ).

Cass. com., 2 July 2013, LawLex202200002772JBJ (S).

Cass. com., 6 July 1993, LawLex202200002781JBJ (RJ).

Cass. com., 16 June 2021, LawLex202100005854JBJ (RJ); 27 November 1991, LawLex202200002769JBJ (RJ) ; 2 November 2016, LawLex202100002412JBJ (RJ).

Cass. com., 16 April 1991, LawLex202100002768JBJ (RJ); 11 May 1993, LawLex202200002770JBJ (RJ).

See by analogy, Cass. com., 14 October 1997, LawLex202200002777JBJ (RJ).

Cass. com., 19 March 1996, LawLex202200002780JBJ (RJ).

Cass. com., 6 May 1997, LawLex202100002770JBJ (RJ).

Cass. com., 9 January 2001, LawLex202100002769JBJ (LJ) ; 17 October 2018, LawLex202100002838JBJ (LJ).

Cass. com., 29 May 2001, LawLex202200002764JBJ (RJ).

Bankruptcy Law

457. Scope of the exception

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457. Scope of the exception

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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