Safeguard and receivership:
The judgement pronouncing the safeguard or receivership opens an observation period.
During this period, which lasts a maximum of 12 months in the case of safeguard proceedings and 18 months in the case of receivership proceedings, the business continues to operate, and the manager continues to manage the company, possibly with the help of an insolvency practitioner.
This observation period protects the company from its previous creditors, who are subject to a ban on payments and the suspension of proceedings.
This period also allows the company to rebuild its cash flow and implement any restructuring measures that may be required, so that at the end of the observation period, it can propose a recovery plan.
In the case of a judicial liquidation:
In a judicial liquidation, the court’s ruling means that, as a matter of principle, the company’s business activity ceases immediately. Exceptionally, the Court may authorise the company to continue trading if this is in the public interest or the interest of creditors, or if prospects for selling the company arise.
In all cases, as soon as liquidation proceedings are initiated, the debtor is divested of the administration and disposal of his assets.
The debtor’s rights and actions regarding his assets are exercised by the liquidator throughout the judicial liquidation.
However, the debtor retains the rights attached to his person, i.e. his own rights, also known as extra-patrimonial rights.
