Creditor

Definition

A creditor is the person or entity to which the company owes a sum: a supplier, a bank, a landlord, an employee, a government body, or a customer who has paid a deposit. Until collective proceedings are opened, the creditor has the ordinary enforcement remedies available at law. From the moment those proceedings are opened, its rights are exercised through the proceedings.

Everything turns on two criteria. The first is the date of the claim: claims arising before the judgment opening the proceedings are subject to the proceedings and must be declared, whereas claims arising after are paid at maturity, which allows the company to continue operating. The second is the security: a creditor holding a privilege, a pledge or a mortgage is not paid in the same rank as an ordinary creditor.

Declaring a claim is not a mere formality: a claim not declared within the time limit is in principle excluded from distributions. The time limit runs from the publication of the judgment opening the proceedings in the BODACC, and it is longer for creditors established outside France.

What the procedure changes for the creditor

The suspension of proceedings

From the judgment opening the proceedings, a creditor can no longer pursue the company to obtain payment, nor carry out a seizure, nor enforce an automatic termination clause. Ongoing actions are interrupted, and interest in principle ceases to accrue for the subsequent period.

The declaration of claim

The creditor declares its claim to the judicial representative, together with the supporting documents. This declaration establishes its place in the proceedings, and the judicial representative verifies its amount and nature before proposing it for admission. A creditor who has doubts about its deadline may apply to the judge-commissioner to be relieved of the time bar.

Payment

After admission, creditors are paid according to the statutory order of priority, with the costs of the proceedings first, then preferential claims, then ordinary claims on a pro rata basis. If the assets are insufficient, closure is ordered for insufficiency of assets and unpaid creditors recover, subject to conditions, their right to pursue individual enforcement.

How the BODACC informs the creditor

For many creditors, the BODACC is the first place where the default becomes visible. The publication of the judgment opening the proceedings, followed by the notice inviting creditors to file their claims, sets the starting point for their deadlines and gives them the name of the insolvency practitioner to contact.

Our platform reproduces these publications. A creditor monitoring a company can find there the complete chronology of the proceedings: opening, filing of the statement of claims, distributions, closure. This is what makes it possible to know where a case stands without calling the court registry.

Frequently asked questions

Does a creditor who has not filed a proof of claim lose everything?

In principle, such a creditor is excluded from distributions, but it may apply to be relieved of the time-bar, provided it proves that its failure to act is not attributable to it. Certain claims are exempt from the filing requirement, in particular those benefiting from a special privilege or those concerning the return of an asset.

Which creditors do not have to file a proof of claim?

Creditors whose claim is secured by a retention-of-title clause, those seeking the return of an asset, employees in respect of claims covered by the wage guarantee, and creditors whose privilege is governed by its own regime. Their rights are exercised under separate rules.

Can a creditor continue to do business with the company?

Yes, and this is often desirable, since a claim arising after the opening of the proceedings is paid when it falls due and not under the plan or the distribution. Many suppliers agree to continue on a cash-payment basis, which is provided for by the legislation.