Alerting and detecting difficulties of an individual entrepreneur

Verified 08 March 2024 - Directorate for Legal and Administrative Information (Prime Minister)

The alert procedure makes it possible to anticipate the difficulties of an individual entrepreneur in order to prevent the situation from worsening. The president of the commercial or judicial court, the approved prevention grouping, the Social and Economic Committee (ESC) may trigger this alert procedure.

An information sheet on the alert procedure applicable to a business shall be available here.

Summoning of the director

The alert is a procedure that remains optional on the part of the president of the court.

When he has reason to believe that the individual entrepreneur is going through economic, financial or legal difficulties, he can call him in for an "awareness" interview.

For example, the president of the court may be aware of the existence of difficulties by the Urssaf, the Banque de France or unpaid employees.

The competent court depends on the nature of the activity:

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Commercial or craft activity

The President of the Commercial Court shall summon the Head of company by registered post with AR and by ordinary post. This notice shall include a note explaining the reasons for his request for an interview.

The summons shall be sent to the less than 1 month in advance.

During this meeting, the president of the commercial court informs the head of company of the existence of various preventive procedures such as the ad hoc mandate and the procedure for reconciliation.

This interview is confidential.

It's the president of the tribunal of the place where the company responsible has its seat:

Who shall I contact

Liberal activity

The President of the Judicial Court shall summon the Head of company by registered post with AR and by ordinary post with a note in which he shall state the reasons for his request for an interview.

The summons is sent at least 1 month in advance.

During this meeting, the president of the court informs the head of company about the existence of various preventive procedures such as the ad hoc mandate and the procedure for reconciliation.

This interview is confidential.

It's the president of the tribunal of the place where the company responsible has its seat:

Who shall I contact

FYI  

Lawyers, court administrators, judicial representatives or public or ministerial officials (notaries, bailiffs, etc.) are not concerned by the alert procedure. However, the President of the Court may inform the professional body or the competent authority of the difficulties encountered.

Meeting between the Head of company and the President of the Tribunal

The president of the court shall draw up a report which shall state the date, place of the interview and the identity of the persons present. He then files it at the court registry.

If the Head of company fails to appear, a report of failure to act shall be drawn up the same day by the Registrar.

The President of the Court may not require the head of the undertaking to appoint a ad hoc trustee or to open a conciliation procedure. It may, if it is aware of evidence justifying the conditions for opening a judicial redress or a judicial liquidation, inform the public prosecutor. The public prosecutor's office may then request the opening of judicial redress or liquidation proceedings.

Investigative powers of the President of the Tribunal

The President of the Tribunal shall have 3 months from the date of dispatch the convening of a meeting to inquire about the economic and financial situation of the sole trader.

He may address his request for information to the following persons or organizations:

  • Auditors
  • Staff members and representatives
  • General government (e.g. tax administration)
  • Social security and welfare institutions
  • Services for centralizing bank risks and payment incidents

Individual business All registered in SCR: titleContent or at RNE: titleContent as a company in the trades and crafts sector has the possibility to join an approved prevention group (APG).

The mission of the APG is to provide its members, in a confidential manner, with periodic analysis of economic, accounting and financial information. When he sees signs of difficulties (for example, difficulties in settling tax and social security payments), he must inform the head of company.

The GPA then directs it to a network of experts.

FYI  

Membership of an approved prevention group shall be subject to payment.

This alert only concerns companies of at least 50 employees. In this case, the ESC may implement an alert procedure for events which may affect the economic situation of the company (e.g. loss of a significant customer, significant and lasting drop in orders, restructuring project). We are talking about the right of economic alert.

The ESC may then ask the employer to provide explanations.

If the replies are deemed insufficient or confirm the concern, the ESC may decide to send a report to the employer and the auditor (CAC) if one exists.

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