Who are the key players in insolvency proceedings in France?

By Yasmine EDDAM13 April 2025

When a company is in serious financial difficulty, French law provides for specific mechanisms to try to save it or, if this is not possible, to organise an orderly winding-up of its business. These procedures, known as sauvegarde, redressement judiciaire or liquidation judiciaire, can seem complex and intimidating. They involve a series of players with clearly defined roles. For a company director, a creditor or even an employee, understanding who does what is an essential first step in navigating this particular legal environment.

The aim of this article is to demystify the landscape of insolvency proceedings by presenting the main players you may encounter: the judicial bodies that oversee the proceedings, the specialised professionals appointed by the courts (the mandataires de justice), and other players representing specific interests, such as employees or creditors. Identifying these different parties and their respective roles will help you to better understand how these procedures work.

The judicial bodies: the procedural framework

At the heart of the system are the judicial institutions. They take the major decisions, supervise the smooth running of operations and ensure compliance with legal rules.

The Commercial Court (or Court of First Instance): the decision-maker

The court has the main decision-making power. Depending on the nature of the debtor's business, it will be :

From Commercial Court if the company carries on a commercial or craft activity. This is the most common case for commercial companies, shopkeepers and craftsmen.
From Court of First Instance (formerly the Tribunal de Grande Instance) in other cases, in particular for the self-employed, farmers or associations.

The competent court is generally the one in whose jurisdiction the company's registered office is located (or the main business address for an individual). For very large companies or cases with a European dimension, so-called "specialised" commercial courts may have jurisdiction (C. com., art. L. 721-8).

What is its role in practice? The court is the cornerstone of the procedure. It is the court that :

Opens the procedure The court decides whether to initiate a safeguard, reorganisation or compulsory liquidation procedure, after examining the situation.
Takes structuring decisions It approves safeguard or reorganisation plans, validates plans for the sale of the company, orders the conversion of one procedure into another (for example, from reorganisation to liquidation), or orders the closure of the procedure.
Name the main players It appoints the official receiver, the court-appointed administrator (when there is one), the court-appointed agent or the liquidator.

The Board's role is therefore central: it provides the initial impetus, sets the course and decides the fundamental issues for the future of the company and the fate of its creditors.

The Judge-Commissioner: the day-to-day supervisor

Once the procedure has been opened, the court appoints a special judge from among its members: the official receiver. The role of the juge-commissaire is crucial and very concrete, acting as the real conductor of the proceedings on a day-to-day basis. Article L. 621-9 of the French Commercial Code gives him the task of ensuring that the proceedings are conducted swiftly and that the interests involved are protected.

In practical terms, the official receiver :

Monitoring and control It closely monitors developments in the company's situation, in particular through the reports of the court-appointed representatives.
Makes quick decisions It has jurisdiction to decide many issues that do not require a hearing before the collegiate court. For example, it authorises certain important (non-routine) management actions during the observation period, rules on third-party claims to assets, or decides what to do with declared claims when they are disputed.
Protecting interests It ensures that the rights of all parties (debtor, creditors, employees) are respected throughout the procedure.
Informs the court He reports to the court before it makes any major decisions (plan, liquidation, etc.).

The official receiver is therefore a key interlocutor, with significant powers to ensure that the proceedings run smoothly. However, the juge-commissaire is not omnipotent and cannot, for example, sit on the court's judgment panel when the court is examining an appeal against one of his own orders or must rule on sanctions against directors (C. com., art. L. 662-7).

The Public Prosecutor's Office (Procureur de la République): the guardian of economic public order

The Public Prosecutor, representing the public prosecutor's office, plays a significant role in insolvency proceedings. His role is to ensure that the law is respected and that economic public policy is protected.

It has a number of prerogatives:

Request the initiation of proceedings The insolvency representative: He may, in the same way as a creditor or the debtor himself, request the opening of a receivership or a compulsory liquidation if he considers that the conditions are met (for example, if he is aware of an undeclared suspension of payments). (C. com., art. L. 631-5, L. 640-5)
Have your say Its opinion is required by the court before a number of important decisions are taken (initiation of proceedings if a conciliation has recently taken place, extension of the observation period, adoption or amendment of plans, sanctions against managers, etc.).
Ensuring legality He ensures that the procedure is carried out in accordance with the legal rules. For example, it may object to the appointment of a court-appointed agent if there is a risk of a conflict of interest.
Exercising legal remedies The public prosecutor has the right to appeal against many decisions, even if he or she did not initiate the original request.

The public prosecutor therefore acts as a guarantor of the public interest and the proper application of the complex rules of insolvency law.

Legal representatives: professionals at the heart of the action

Alongside the judicial bodies, there are professionals appointed by the court, known as judicial representatives. They are the linchpins of the procedure. Since a reform in 1985, a distinction has been made between two distinct professions, with clearly separated missions to avoid conflicts of interest.

Fundamental distinction: Administrator vs Judicial Representative/Liquidator

Why two main types of professional? The law clearly separates :

The function oriented towards company rescue and its management (entrusted to the court-appointed administrator).
The function oriented towards defence of creditors and the liquidation of assets if necessary (entrusted to the mandataire judiciaire and then, if necessary, to the liquidator).

This separation ensures that the sometimes divergent interests of the company and its creditors are represented by separate parties (based on C. com., art. L. 811-1 and L. 812-1).

The Judicial Administrator: focus on the company

Judicial administrators are not always appointed. His appointment by the court is :

Mandatory in safeguard and recovery proceedings for companies exceeding certain thresholds (currently 20 employees or €3 million in sales excluding tax). (C. com., art. L. 621-4, R. 621-11)
Optional for smaller companies, but may be requested by the debtor, the mandataire judiciaire, the public prosecutor, or decided ex officio by the court in reorganisation. (C. com., art. L. 621-4, L. 631-9)
Possible (or even mandatory, depending on thresholds) in compulsory liquidation if a decision is taken to temporarily maintain the business (C. com., art. L. 641-10)

Its main mission is to focus on the company itselfIn particular, it deals with the division of powers and responsibilities with the manager during the observation period. Depending on the situation and the court's decision, it will :

Watch management of the debtor (in safeguard).
Assist the debtor for acts of management (in safeguard or reorganisation).
Represent the debtor, i.e. assume sole responsibility for the administration of the business (mainly in reorganisation). (C. com., art. L. 622-1, L. 631-12)

In addition to day-to-day management, its main role is to analyse the company's situation (via the economic and social report) and to draw up, with the help of the debtor (in reorganisation) or by assisting the debtor (in safeguard), a draft plan aimed at ensuring the survival of the business. It is also responsible for deciding whether or not to continue current contracts.

The Judicial Representative: the voice of creditors (Safeguard/Restructuring)

Unlike administrators, judicial representatives are always designated from the opening of safeguard or receivership proceedings. (C. com., art. L. 621-4)

Its mission is clear: represent the collective interests of creditors. (C. com., art. L. 622-20) He is not the lawyer of a particular creditor, but the defender of the body of creditors whose rights are affected by the proceedings.

Main tasks include:

Receiving claims declarations All creditors whose debts arose before the opening judgment must declare their claims to the company.
Checking liabilities He examines each claim, discusses it with the debtor and proposes to the official receiver that it be admitted or rejected.
Consulting creditors The insolvency representative receives the debtors' opinions on the debt repayment proposals contained in the draft plan (payment deadlines, debt write-offs, etc.).
Taking legal action He can initiate certain actions in the interests of creditors, such as actions for the annulment of suspicious acts carried out just prior to the proceedings.

The judicial representative is therefore the creditors' main contact throughout the observation and plan preparation phases.

The Liquidator: the organiser of the sale (Liquidation Judiciaire)

When the court pronounces a judicial liquidation (either at the outset or after the failure of a safeguard or reorganisation), it will appoints a liquidator. Very often, this is the judicial representative who was already in office. (C. com., art. L. 641-1)

The liquidator's mission is radically different from that of the administrator: it is no longer a question of saving the company, but of organising its orderly demise. To do this, he :

Completes verification of receivables (if it wasn't finished).
Sells the company's assets (realisation of assets): This can be done through separate sales (real estate, equipment, inventory, etc.) or through the overall sale of the company or a branch of activity (sale plan). (C. com., art. L. 641-4)
Dismisses employees (unless a sale plan provides for them to be taken over).
Recovering debts that the company could have on its own customers.
Distributes sales revenue creditors, in accordance with a very strict order of priority laid down by law. (C. com., art. L. 641-13)
Exercises the debtor's rights on its assets for the duration of the liquidation, the manager being "divested". (C. com., art. L. 641-9)

The liquidator therefore manages the final phase, aimed at paying creditors as well as possible with the proceeds from the sale of the company's assets.

Other key players

In addition to judicial bodies and legal representatives, other players play a specific role.

The Employee Representative: defending employees' rights

Whether or not there is a works council or staff representatives, a specific employee representative must be appointed or elected by the employees at the start of the procedure. (C. com., art. L. 621-4)

Its main role is to check wage claims (unpaid wages, compensation, holiday pay, etc.) drawn up by the mandataire judiciaire or liquidator. (C. com., art. L. 625-2) He ensures that employees' rights are correctly calculated and taken into account. It may assist employees before the Conseil de Prud'hommes in the event of a dispute over these claims. In the absence of other representative bodies, it also performs their information and consultation functions during the proceedings.

The Controllers: a right of review for creditors

The juge-commissaire may appoint one to five "controllers" from among the creditors who so request. (C. com., art. L. 621-10) At least one of them must be a creditor with a guarantee (lien, mortgage, etc.), and another a creditor without any particular guarantee (unsecured).

Their mission is toassisting the judicial representative and the juge-commissaire in their supervision of the proceedings. (C. com., L. 621-11) They have access to a great deal of information and can make observations. Above all, if the mandataire judiciaire or liquidator remains inactive on an action that could benefit creditors (for example, a liability action against a third party), the supervisors (subject to a majority for certain actions) may be authorised to act in his place. They thus offer an additional guarantee for the defence of creditors' interests.

Understanding who these different players are and what their responsibilities are is an essential first step for anyone faced with insolvency proceedings, whether as a director, creditor or employee. The complexity of the interactions and issues at stake often underlines the importance of good advice.

If this sounds like you, don't hesitate to contact our firm to support you and defend your interestsWhether you are a company director, a creditor or an employee, we can ensure that your rights are respected within this complex legal framework.