By Yasmine EDDAM
5 April 2025
When a company encounters financial headwinds, French law offers several legal frameworks for dealing with the situation. These mechanisms, often grouped together under the generic term of «collective proceedings», are not identical and respond to distinct situations and objectives. Understanding the fundamental differences between safeguard, receivership and compulsory liquidation is essential for managers, creditors and any other economic players involved, so that they can anticipate the consequences and defend their interests as effectively as possible. How do you know which procedure applies? Who can apply to open a procedure? And what are the immediate effects once the judgement has been handed down? This article aims to shed some light on these questions. We will explore the conditions under which each major collective procedure may be opened and the possible initiators, briefly describe the stages leading up to the court's decision, and above all, detail the immediate and often radical consequences of the opening judgment for the company, its employees and its...
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