What to do in the event of insolvency proceedings against a debtor?
This procedure places the company under judicial supervision, in order to draw up a recovery and debt payment plan.
SSP Collect takes a look at what this means for creditors, how to deal with it and how to avoid it if possible.
What are collective proceedings?
This is a set of judicial measures to deal with a debtor’s financial difficulties.
It brings together all creditors who can no longer act individually to collect debts.
The court-appointed trustee must reconcile and preserve the interests of each party as far as possible.
The different types of insolvency proceedings
- Safeguard: For companies in justified financial difficulty, but not yet insolvent.
- Judicial reorganization: When the company is in suspension of payments, but its situation is not irremediably compromised.
It can be implemented after the company has ceased trading. - Judicial liquidation: When business recovery is impossible.
The non-trading company ceases trading and its assets are sold to pay off creditors.
Implications for creditors
Collective proceedings often mean financial loss for creditors, even if attempts are made to recover some of it.
During the judgment phase, creditors are obliged to go through the mandataire de justice to claim what is owed to them.
Declaring a claim from a debtor in collective proceedings
Creditors are notified by the court-appointed trustee or liquidator of the opening of the procedure within 15 days.
To assert their rights, companies must file a claim with the competent court.
What claims must be declared and who must make the declaration?
In order to obtain payment, you must declare all claims, whether prior or subsequent to the opening of the procedure.
Some claims are privileged and do not need to be declared.
How do I declare my claims, depending on the procedure?
The claim declaration is made by the company’s representative or an agent.
It must contain certain details: amount, nature and justification of the claim, calculation of interest, basis of security.
What are the deadlines for declaring a claim in insolvency proceedings?
The declaration period is two months from the opening of the legal proceedings.
For creditors outside mainland France, it is four months.
What are the consequences of declaring claims in collective proceedings?
Once the declaration has been made, the judicial representative verifies the claims and issues a decision.
Creditors participate in any distribution of the company’s assets, according to the priority of their claims.
These are lengthy procedures, however, and any oversight or error can exclude a creditor.
Be careful when making your declaration.
What’s more, due to the large number of claimants, not all repayments are successful.
How to avoid bankruptcy proceedings?
- Discover SSP Collect’s solutions to avoid insolvency proceedings.
- Commercial reminders: our telephone service (Collectel) and our support platform (Softcollect) for commercial reminders speed up debt collection.
These services enable us to analyze a company’s situation before it reaches the legal stage of insolvency proceedings. - Guaranteed collection:Debteo is an item management service designed to protect you against unpaid invoices.
Our experts take charge of managing your cash flow and preventing unpaid invoices by finding out about your buyers, then organizing your commercial reminders.
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