Companies in difficulty and restructuring
Commercial lease lawyer in insolvency proceedings, landlord or tenant
The commencement of safeguard, receivership, or liquidation proceedings does not, in itself, terminate a commercial lease. The landlord can only take action for rent arrears incurred since the judgment after a three-month waiting period. Rent arrears prior to the judgment are declared as liabilities. ARST Avocats represents tenants, landlords, and those acquiring the business, from the initial judgment to the hearing.
- Essential for 2026:Decision-Makers' Ranking, Restructuring
- Tenants, landlords, buyers:From the opening judgment to the hearing
- Fanny Hurreau,Lead Lawyer
Is a commercial lease terminated when the tenant enters insolvency proceedings?
No, not automatically. The Commercial Code prohibits any termination based solely on the commencement of proceedings, whether in safeguard or reorganization proceedings (art. L. 622-13, I) or in liquidation proceedings (art. L. 641-11-1, I). The lease remains a valid contract, with its rent, charges, and clauses.
The administrator, or the liquidator in liquidation proceedings, then decides whether or not to continue the contract (Art. L. 622-13, II and L. 641-11-1, II). If they decide not to continue, the lease is terminated on the day the landlord is informed (Art. L. 622-14, 1° and L. 641-12, 1°). The landlord may then claim damages, which must be declared as a liability.
One important point to be aware of: a lease already terminated by a final decision before the commencement of insolvency proceedings is no longer a valid contract. These protections do not apply.
The lease at the opening
Why a lease dispute in insolvency proceedings hinges on a timetable
Our interpretation is simple: in these cases, rights are lost less on the substance than on the dates. Three matter.
- The opening judgment starts the 3-month period during which the landlord cannot take action for unpaid rents since the opening.
- Publication in the BODACC This starts the two-month period for declaring previous rent payments under penalty of forfeiture.
- The decision of the supervising judge is the moment when it is checked whether subsequent rents remain unpaid.
The starting point for the three-month period depends on the course of the proceedings. If the reorganization or safeguard procedure is converted into liquidation, the initial opening judgment remains valid (Cass. com., 19 Feb. 2013, No. 12-13.662). If liquidation is initiated after the termination of a plan, it constitutes a new procedure, and the period begins from the date of the termination judgment (Cass. com., 18 Jan. 2023, No. 21-15.576).
Three important dates
- The opening judgment is validThe landlord cannot take action for unpaid rents since the opening.
- Publication in the BODACCDeclare previous rents, under penalty of forfeiture.
- The judge-commissioner's decision:The moment when it is verified whether subsequent rents remain unpaid.
As a tenant in insolvency proceedings, what do you have to pay and what are the risks?
Rent and charges due for the occupancy of the premises after the commencement order are payable on their due date (Art. L. 622-17, I and L. 641-13, I). These are what protect the lease.
Conversely, in both safeguard and reorganization proceedings, the opening judgment prohibits the payment of debts incurred before it (art. L. 622-7, I). , spontaneously settling arrears to appease the landlord is a mistake: the payment can be cancelled, at the request of any interested party or the public prosecutor, for up to 3 years (art. L. 622-7, III).
Closing a site does not jeopardize the lease in this respect. Notwithstanding any clause to the contrary, the failure to operate during the observation period does not lead to the termination of the lease, even if the company leases several buildings (art. L. 622-14).
If a subsequent rent payment remains unpaid, the landlord can take action after 3 months. However, until the supervising judge has ruled, paying the sums due precludes their claim : the judge verifies, on the day of their ruling, that the subsequent rent payments remain unpaid (Cass. com., June 12, 2024, No. 22-24.177).
A landlord has written to you after the opening judgment? Let's discuss your situation before responding.
Landlord of a tenant in insolvency proceedings, how to protect your rent payments?
Two systems overlap, depending on the date the debt originated.
Rent arrears prior to the judgment are no longer recoverable from the tenant. The judgment initiating insolvency proceedings suspends or prohibits actions for payment and lease termination for non-payment (Art. L. 622-21, I). The claim must be filed with the court-appointed administrator within two months of the judgment's publication in the BODACC (Art. L. 622-24 and R. 622-24). This period is extended by two months for creditors residing outside metropolitan France, if the proceedings are initiated in metropolitan France. Failure to file a timely claim renders the claim time-barred. Relief from forfeiture is only possible under certain conditions (Art. L. 622-26).
Rent payments made after the judgment must be made on their due date. If they remain unpaid, two options are available, in both cases not before the expiration of 3 months:
- the request to the supervising judge (art. L. 622-14, 2° and L. 641-12, 3°), which does not require a payment order when the landlord does not invoke the termination clause (Cass. 3rd civ., Nov. 24, 2021, n° 20-20.973) ;
- the action based on the termination clause of the lease, which involves a payment order that remains without effect for one month (art. L. 145-41).
The choice between the two options depends on the debtor's behavior. A tenant who pays at the last minute will have the request rejected, since the judge assesses the debt on the day of the ruling. The termination clause option gives the tenant one month after the formal notice, but it is subject to grace periods. Law No. 2026-403 of May 26, 2026, tightened these grace periods for applications filed since its entry into force, published in the Official Journal on May 27, 2026. To obtain payment extensions or the suspension of the clause for non-payment of rent, the tenant must demonstrate their ability to settle their debt. They must also have resumed full payment of the current rent before the first hearing (Art. L. 145-41). We detail this reform in our analysis of the law of May 26, 2026.
What happens to the lease in the event of liquidation or sale of the company?
In judicial liquidation, the liquidator may assign the lease under the conditions stipulated in the contract, with all the associated rights and obligations. Any clause imposing joint and several liability on the assignor with the assignee is deemed unwritten (art. L. 641-12).
When the court approves a transfer plan, the judgment entails the transfer of contracts it deems necessary for maintaining the business. These contracts are executed under the conditions in effect on the date of commencement, notwithstanding any clause to the contrary (Art. L. 642-7). The court may also authorize the transferee to add related or complementary activities to those stipulated in the lease, after hearing from or duly summoning the landlord.
For a buyer, the lease is therefore a part of the offer file to be examined from the outset: intended use of the premises, rent arrears, transfer clauses.
- May assign the lease under the conditions stipulated in the contract.
- Any clause imposing joint and several liability on the transferor with the transferee is deemed unwritten.art. L. 641-12
- The judgment entails the transfer of contracts necessary for the continuation of the business.
- Executed under the conditions in force on the date of opening, notwithstanding any clause to the contrary.art. L. 642-7
- Related or complementary activities: the landlord is heard or duly summoned.
Three mistakes to avoid
- Paying a previous arrears on one's own initiative, tenant's side. The payment can be cancelled for 3 years.
- Allow the 2-month declaration period to expire, on the landlord's side. The prior claim is then time-barred.
- Submitting a request without tracking paymentsFrom the landlord's perspective, if the tenant has paid subsequent rent payments before the judge's ruling, the claim is dismissed.
The situations we deal with
Closure of sites undergoing restructuring
A retail chain under court-ordered restructuring closes two unprofitable outlets. During the observation period, this failure to operate does not lead to the termination of the lease, notwithstanding any clause to the contrary.
Opening announcement published in the BODACC
A landlord learns through the BODACC (Official Bulletin of Civil and Commercial Announcements) that proceedings have been initiated against his tenant, who owes him several months' rent. The two-month period for filing a claim has already begun.
Unpaid current rent
Three months after the commencement of insolvency proceedings, the current rent payments remain unpaid. The landlord can petition the supervising judge, and the tenant can still settle the outstanding amount before the judge makes a ruling.
Taking over a fund at auction
A buyer wants to retain the premises of a business in receivership. When approving the transfer plan, the court determines the contracts necessary for the business activity, which may include the lease.
How does our support work?
Reading the lease and the calendar
We note the date of the opening judgment, the date of its publication in the BODACC, the nature of the procedure and the clauses of the lease, then we set each deadline.
Strategy selection
For the landlord, this involves filing a claim, monitoring subsequent rent payments, and choosing between a formal request and a termination clause. For the tenant, it involves paying current rent and discussing the continuation of the lease.
Exchanges with the bodies involved in the procedure
We engage in dialogue with the administrator, the judicial representative or the liquidator, and prepare requests for the supervising judge.
Hearing and execution
We defend your position before the supervising judge or the court, then follow up on the execution of the decision, plan or transfer.
Safeguarding, restructuring or liquidation: what are the differences for the lease?
The lease regime is similar in all three procedures, although the relevant legislation is separate. The rules governing safeguard proceedings apply to judicial reorganization by reference (art. L. 631-14).
Same rules, by reference (art. L. 631-14).Separate texts.
| Question | Safeguard or judicial reorganization | Judicial liquidation |
|---|---|---|
| Who decides to continue the lease? | The administrator (art. L. 622-13, II) | The liquidator (art. L. 641-11-1, II) |
| If the organ gives up | Termination on the day the landlord is informed (art. L. 622-14, 1°) | Same rule (art. L. 641-12, 1°) |
| Rents after the judgment | Paid when due (art. L. 622-17, I) | Paid when due (art. L. 641-13, I) |
| Landlord's action for unpaid rent after the fact | Not before 3 months from the date of the opening judgment (art. L. 622-14, 2°) | Same conditions (art. L. 641-12, 3°) |
| Rents prior to the judgment | Declaration within 2 months, no action for payment (art. L. 622-21, L. 622-24) | Declaration within 2 months (art. L. 641-3, L. 622-24, R. 622-24). Action for termination for prior reasons within 3 months of the publication of the liquidation judgment (art. L. 641-12, 2°) |
Frequently asked questions about commercial leases in insolvency proceedings
Does a court-ordered liquidation terminate a commercial lease?
No, not on its own. The commencement of liquidation proceedings does not automatically terminate the existing lease (Art. L. 641-11-1, I). The liquidator may terminate the lease, which is then terminated on the day the landlord is notified, or assign it under the conditions stipulated in the contract (Art. L. 641-12). The landlord may also take action for unpaid rent after three months. For reasons for termination that arose before the judgment, the landlord must notify the supervising judge within three months of the publication of the liquidation judgment (Art. L. 641-12, 2°).
As a tenant in receivership, when can I take action regarding unpaid rent?
For rent due after the commencement of insolvency proceedings, the landlord can only take action after a period of three months from the date of that judgment. If payment is made before the expiry of this period, there is no basis for termination of the lease (Art. L. 622-14, 2°). For rent due before this period, no action for payment is possible: the claim must be filed within two months of publication in the BODACC (Official Bulletin of Civil and Commercial Announcements).
Can I close my premises during the observation period?
Yes, without risk of termination for this reason alone. Notwithstanding any clause to the contrary, the failure to operate during the observation period, in one or more buildings leased by the company, does not lead to termination of the lease (Art. L. 622-14). This does not exempt the tenant from paying rent due after the commencement of proceedings, the non-payment of which allows for termination proceedings after 3 months.
Are my unpaid rents before the judgment lost?
No, but they are no longer being claimed from the tenant. The landlord must declare them to the court-appointed administrator within two months of the publication of the judgment in the BODACC (articles L. 622-24 and R. 622-24). If the declaration is not made within this timeframe, the debt is time-barred, and relief from forfeiture is only possible under certain conditions (article L. 622-26). Payment then depends on the procedure and the repayment plan.
Can you transfer your lease during insolvency proceedings?
Yes, within a specific framework. In liquidation proceedings, the liquidator may assign the lease under the conditions stipulated in the contract, with any clause imposing joint and several liability on the assignor with the assignee being deemed null and void (Art. L. 641-12). In a transfer plan, the judgment approving the plan entails the assignment of contracts necessary for the business activity, executed under the conditions in effect on the date of commencement (Art. L. 642-7).
Who pays the rent during the observation period?
The company undergoing insolvency proceedings must pay rent and charges due for the occupancy of the premises after the commencement of proceedings, when they are due (Art. L. 622-17, I). If these payments are not made by the due date, they are paid as a priority claim before other debts, subject to certain exceptions (Art. L. 622-17, II). Failure to pay also allows the landlord to initiate termination proceedings after three months.
- 3 monthsfrom the date of the opening judgment, before taking action to terminate the lease for rents unpaid since the opening.
- 2 monthsfrom the date of publication of the judgment in the BODACC, to declare previous rents.
- 3 yearsPeriod during which the payment of a previous debt, made in violation of the prohibition to pay, can be cancelled.
Content prepared by the restructuring and insolvency department of ARST Avocats. Lead lawyer: Fanny Hurreau, partner, Hauts-de-Seine Bar. Rules verified against the French Commercial Code and rulings of the Court of Cassation. Updated October 2026.