Bankruptcy Law

The Law of 26 July 2005  extended the benefit of insolvency proceedings to people who are self-employed or liberal professionals. Article L. 640-2 of the Commercial Code now covers all entrepreneurs who carry on a business other than a commercial, craft or agricultural activity, such as lawyers , architects, self-employed entrepreneurs , doctors, masseur-physiotherapists , nurses, etc.
The law is  …

Self-employed and liberal professions

The Law of 26 July 2005  extended the benefit of insolvency proceedings to people who are self-employed or liberal professionals. Article L. 640-2 of the Commercial Code now covers all entrepreneurs who carry on a business other than a commercial, craft or agricultural activity, such as lawyers , architects, self-employed entrepreneurs , doctors, masseur-physiotherapists , nurses, etc.

The law is not concerned with the status of self-employed professional but with the characterization of the exercise of an independent professional activity : the registration of the natural person in the register of commercial agents  or the non-registration on the roll of a professional association  does not prevent the submission of a natural person who exercises an independent professional activity or a liberal profession to the regime of collective proceedings. Similarly, the mere fact that an individual is registered in the Undertakings and Establishments Register does not mean that he or she is actually carrying on a self-employed professional activity .

Since 1 January 2006 , the date on which the Law of 26 July 2005 came into force, an insolvency procedure may be opened against an individual who carries on a self-employed professional activity or a liberal profession, provided that the individual remains in business  and is in a state of cessation of payments on the date on which the court gives its ruling, even though the individual's liabilities were due and payable before 1 January 2006 . Furthermore, if the individual is no longer self-employed, he or she may still benefit from the insolvency regime if the debts at issue arose in the course of the business carried on in his or her own name . On the other hand, individuals who are self-employed or self-employed professionals on the date of the court's ruling may not be the subject of over-indebtedness proceedings , regardless of the origin of the debts claimed , including those contracted prior to the self-employed activity or liberal profession .

Finally, since independence is a necessary condition for benefiting from insolvency proceedings, managers  and partners  are excluded. Nevertheless, an insolvency procedure may be opened against a person who carries on a self-employed professional activity or a liberal profession, even if he has formed a company to carry on that activity, provided that he has never been registered with the RCS and cannot therefore be considered as having ceased to carry on that activity on an individual basis .

Law No 2005-845 of 26 July 2005 on safeguarding businesses, OJ 27 July 2005.

See in particular Cass. com., 17 June 2020, LawLex202100003620JBJ (RJ).

See in particular Cass. com., 27 May 2008, LawLex202100003655JBJ (LJ).

CA Douai, 23 March 2017, LawLex202100006041JBJ (RJ). See also, Cass. 2e civ. 1 December 2016, LawLex202100003650JBJ (RJ), holding that a self-employed entrepreneur who has ceased his activity only falls under Book VI of the Commercial Code if all or part of his liabilities come from that activity.

Cass. com. 30 September 2008, LawLex202100005839JBJ (RJ) holding that a masseur-physiotherapist practises a liberal profession and cannot, as such, be the subject of a private individual over-indebtedness procedure.

Cass. 2e civ., 18 February 2016, LawLex202100005707JBJ (RJ), holding that a self-employed business adviser who carries on an independent professional activity falls within the scope of the insolvency procedures and not the over-indebtedness procedure for individuals, regardless of the origin of the debts relied on. See in particular. Cass. com. 17 June 2020, LawLex202100003620JBJ (RJ), allowing a lawyer to benefit from an insolvency procedure on the basis of a debt unrelated to his professional activity.

CA Rouen, 21 October 2016, LawLex202100005822JBJ (LJ).

Cass. com., 15 November 2016, LawLex202100005711JBJ (RJ).

Cass. com. 9 February 2010, LawLex202100006211JBJ (LJ), excluding from the benefit of insolvency proceedings a lawyer who carries on his activity as a partner in a liberal practice company. See also, by analogy, Cass. 2e civ. 1 June 2017, LawLex202100006062JBJ (RJ), holding that an orthodontist who does not practise in his own name but as a partner in a professional partnership is not covered by insolvency proceedings; Cass. com, 16 September 2014, LawLex202100001850JBJ (RJ), holding that a dental surgeon, who has ceased to practice on an individual basis in order to become the sole partner of a liberal practice company (société d'exercice libéral), is no longer acting in his own name but in that of the company and can no longer be served with a writ of receivership at the end of the one-year period.

Cass. com., 17 June 2020, LawLex202100003620JBJ (RJ).

See in particular CA Limoges, 7 July 2021, LawLex202100005830JBJ (RJ).

See in particular Cass. com., 30 September 2008, LawLex202100005839JBJ (RJ).

CA Aix-en-Provence, 23 February 2017, LawLex202100006063JBJ (RJ), holding that the mere designation of a person as an “industrialist” in a preliminary sales agreement is not sufficient to bring that person within the scope of the insolvency proceedings regime in the absence of characterization of a personal independent professional or commercial activity.

Cass. 2e civ., 23 June 2016, LawLex201600001271JBJ (RJ).

CA Grenoble, 28 March 2013, LawLex202100006042JBJ (RJ).

Cass. com., 3 April 2019, LawLex202100003657JBJ (RJ).

Law No of 26 July 2005, Art. 190: “This law comes into force on 1 January 2006”.

CA Limoges, 7 July 2021, LawLex202100005830JBJ (RJ), holding that only practising auto-entrepreneurs can be the subject of an insolvency procedure.

Bankruptcy Law

627. Self-employed and liberal professions

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627. Self-employed and liberal professions

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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