Insolvency has a precise definition, and the law sets a short deadline for acting: 45 days. Spotting it in time means keeping your choice of solutions open, and protecting yourself as a director. Here are the essentials (factsheet F22352).
1. The definition
A company is insolvent when it is unable to meet its liabilities due (passif exigible) out of its available assets (actif disponible) (Article L631-1 of the French Commercial Code).
- Liabilities due: debts that have fallen due (suppliers, salaries, social security contributions owed to Urssaf, taxes, bank).
- Available assets: cash and credit reserves, for example an authorised overdraft that has not been used. The company's property (stock, equipment, real estate) is not included.
- A company that proves that its credit reserves or the payment extensions granted by its creditors allow it to pay is not insolvent.
2. The 45-day deadline
The director must apply for proceedings to be opened no later than 45 days after the company becomes insolvent, unless they have applied for conciliation within that period (Article L631-4 of the French Commercial Code).
3. The possible procedures
- Conciliation remains possible if the company has been insolvent for less than 45 days: an out-of-court, confidential procedure with creditors, lasting 4 months, extendable by one month (justice.fr).
- Judicial reorganisation (redressement judiciaire), if the company can still be saved through a plan.
- Judicial liquidation, if the situation is irretrievably compromised.
The director states which procedure they are applying for; the court decides.
4. The risks for a director who delays
- A ban from managing a business (interdiction de gérer) may be imposed on a director who knowingly failed to apply for proceedings within the 45 days without having applied for conciliation; it is not automatic and can last up to 15 years (Article L653-8 of the French Commercial Code).
- Liability for the asset shortfall (responsabilité pour insuffisance d'actif): in a liquidation, the court may order a director whose management error contributed to the asset shortfall to bear all or part of the debts, except in cases of mere negligence (Article L651-2 of the French Commercial Code).
- The date of insolvency is set by the court, and can be backdated up to 18 months before the judgment; certain transactions carried out during that period may be set aside (Article L631-8 of the French Commercial Code).
5. Where and how to file
- The court: the commercial court (tribunal de commerce) for a commercial or craft business, the judicial court (tribunal judiciaire) for a liberal profession or an agricultural business; in 12 cities, an economic activity court (tribunal des activités économiques) has replaced them on an experimental basis since 1 January 2025. A simulator from the Ministry of Justice shows which court has jurisdiction.
- The form: Cerfa No. 10530 (online form), to be filed with the court registry (greffe) or online at tribunaldigital.fr, depending on the registry's practice.
6. Documents to attach
In addition to the annual accounts for the last financial year, the following in particular (Article R631-1 of the French Commercial Code):
- a statement of liabilities due and available assets;
- a cash position less than one month old;
- the number of employees and the revenue for the last financial year;
- a costed statement of receivables and debts, with the identity of the creditors and the amounts owed to employees;
- a statement of security interests and off-balance-sheet commitments;
- a summary inventory of assets;
- the contact details of the representatives of the CSE (comité social et économique, the French works council), if there is one;
- a sworn statement confirming that there has been no mandat ad hoc (a confidential negotiation led by a court-appointed third party) or conciliation in the last 18 months.
The documents are dated, signed and certified as accurate by the director.
7. Get help early
Before it comes to this, other doors are open: a confidential meeting with the president of the court, the information centres on preventing business difficulties (CIP), conciliation or the mandat ad hoc, and the CCSF (commission des chefs des services financiers) for tax and social security debts. The earlier you act, the more solutions there are.
Please note: this guide is for information only, up to date as of 14 October 2026, and is no substitute for advice tailored to your situation. Insolvency is a time when the advice of a lawyer or a court-appointed administrator (administrateur judiciaire) is essential. For a specific case, consult your expert-comptable (chartered accountant) or your lawyer.