Arst Avocats designed this mini-series to give you an inside look at a judicial reorganization procedure.
By Morgan Jamet, Partner Attorney — Insolvency Law
Published on August 22, 2026
The accountant pushed his computer into the middle of the table so that everyone could see the same chart. Marc, me, and the administrator, who had exceptionally come to our premises rather than to his office — a sign, I think, that he too is starting to believe in it a little more than on the first day.
This time, the picture almost stands on its own. The leasing company has settled, the landlord's rent has been reduced to the actual amount owed, and the URSSAF (French social security agency) has corrected its flat-rate assessment based on the real figures. Only one line remains circled in red: the supplier's claim, still before the competent court—it's now up to them to make the first move. We're building on this, as planned from the start, without waiting for the outcome. And the bank is no longer part of the shared picture: its agreement, negotiated separately, secures its claim on its own trajectory, independent of the annual payments we'll calculate here for the others.
It's good news that opens the meeting. It never lasts very long in this kind of case—I start telling Marc this as a matter of fact rather than a warning. Reorganization proceedings are never a straight line. It's a succession of ups and downs, sometimes within the same hour, and you have to learn not to get carried away by either one.
The proof arrives twenty minutes later. The administrator's phone vibrates; he apologizes, answers, listens, his face suddenly hardening. "Something wrong?" asks Marc, already tense. One of the two reliable clients, the one who has always paid promptly since the business opened, missed a two-day deadline on her last invoice—the first time since the start of the proceedings. On a debt incurred after the judgment, this kind of delay is significant: it's precisely the type of incident the court scrutinizes at every hearing, the kind that cannot be allowed to become a habit. Marc pales, already fearing the worst. Ten minutes of heavy silence ensue while the administrator calls the client. She answers immediately: a simple accounting discrepancy on her end, nothing more; the transfer will be sent that same afternoon. And indeed, it is sent before the meeting ends. False alarm, but a real alarm at the time — exactly what I wanted Marc to feel: this constant tension between good and bad news, which will not end with the adoption of the plan.
We resume, as if nothing had happened, but with a little less innocence than at the beginning of the morning.
“So, how much time do we have?” Marc asks, almost impatiently. Ten years, at most, is what the law allows for a restructuring plan. Except that this particular court, as Marc was told a few weeks earlier, doesn't go that far in practice. They work over eight years. It's not a matter of convenience—it's two fewer years to absorb the same liabilities, which tightens every line of the table accordingly.
The accountant lays out the figures, one by one. The first two years can remain relatively easy—that's when you can breathe, while business really gets back on track. But from the third year onward, each annual payment must represent at least 5% of each of the admitted receivables, and from the sixth year, this threshold climbs to 10%—over an eight-year plan, that means the last three years bear the brunt of the effort. It's not an average that can be smoothed out as you see fit. It's creditor by creditor, year by year. "So I can't just put everything off until the end," Marc sums up. No. The law requires a gradual repayment, not a mountain of debt in year eight.
So, we build backwards: what projected revenue, what margin, what available cash each year, so that these annual payments can be made without recreating exactly what we're trying to fix. The administrator emphasizes one point, with the same rigor as in the boardroom: "Don't make optimistic assumptions. A plan that isn't met in the third year is worse than a more modest plan that is adhered to—even more so over eight years than over ten." He's right, and this is precisely the most common mistake: inflated forecasts to reassure everyone in the short term, which backfire on the company as soon as reality catches up with the picture.
The challenge now is to convince those to whom the money is owed, aside from the bank, which has already been paid separately. This isn't a collective vote—the company is too small for creditors' committees. The trustee will write to each creditor individually by registered mail, detailing the proposed payment terms. Each creditor will have thirty days to respond from the date of receipt. After this period, silence is considered tacit acceptance of the proposals. The exception is the URSSAF (French social security agency) and the Treasury, which must give their explicit consent for any debt forgiveness—the payment terms, however, are binding on them just as they are on everyone else.
The administrator stopped us at that precise moment, pointing out a detail that could have derailed everything. The draft consultation letter, prepared by his team, omitted the mandatory asset and liability statements. "Without this document, the thirty-day period wouldn't even begin. We would have waited a month for nothing—a month we don't really have, given our tight eight-year timeframe." A minor administrative matter, it seemed. In practice, an error that would have cost us an entire month in an already tight schedule. Yet another shift, in just a few minutes, from satisfaction to worry, then to relief once the error was corrected.
Before closing the session, Marc pulls out one last document, almost timidly: a letter from one of his two key clients, confirming in writing his intention to continue working with him for the next three years. It's not strictly part of the case file. But the administrator keeps it anyway, slipping it into the pile. "This kind of thing can't hurt in court."
As he left, Marc glanced at the board one last time. "Eight years already seems like a long time from here. And this meeting was the story of this whole process in a single morning: good news, a warning, more good news, a mistake narrowly avoided." He wasn't wrong. That's exactly what receivership is like, experienced from the inside—never a smooth ride, but never a continuous shipwreck either. The file goes to the creditors for review this week. Now they'll have to wait for their responses—or their silence.
—
*Marc and the situations described in this series are fictional, composites of cases encountered in practice. Any resemblance to a real situation is purely coincidental.*
*Next episode — Season 1, Episode 16/17: “Plan Review and Adoption Hearing”
Morgan Jamet,
founding partner of Arst Avocats, advises business leaders on commercial law, insolvency law, restructuring, and business litigation.
View his profile
