Distressed and Bankrupt Companies

Seeking to ensure the survival of companies that could become insolvent in the coming months due to the phasing-out of the support measures that have been put in place, the French legislator has adopted a Law introducing a new procedure, i.e., the judicial crisis recovery management procedure.

This temporary procedure is of particular interest to debtors who may be experiencing short-term difficulties caused by the COVID-19 health crisis and who wish to benefit from a simple and rapid mechanism for spreading out their current liabilities over a long period of time.

Law No. 2020-1525 of December 7, 2020 on the acceleration and simplification of public action (often referred to under its French acronym “ASAP” Law) has extended until December 31, 2021 a number of derogations that adapt French legal provisions governing distressed companies to the COVID-19 health crisis.

The adoption of this Law provides the opportunity to recall the various measures that remain applicable to date.