Receivership: how it works, step by step

Receivership opens when a company can no longer pay its due debts but recovery is not manifestly impossible. The goal is to keep the business running, protect jobs and clear the liabilities.

What is receivership?

It is a court-supervised collective procedure opened for a business that is in cessation of payments — unable to meet its due liabilities with its available assets — where recovery still appears possible.

It differs from safeguard (opened before cessation of payments) and from judicial liquidation (when recovery is manifestly impossible).

Who can request it?

The director must declare cessation of payments to the court registry within 45 days. The procedure can also be requested by a creditor (writ of summons) or by the public prosecutor.

Step by step

Opening judgment: the court records cessation of payments and appoints a supervising judge, a judicial representative (for the creditors) and often an administrator.
BODACC publication: the judgment is published; this starts the claim-filing deadline.
Observation period: 6 months, renewable, up to 18 months. The business keeps operating while an economic and social review is prepared.
Filing of claims: each creditor files its claim with the representative within two months of publication.
Outcome: a recovery plan (continuation or sale), or conversion into liquidation if recovery becomes impossible.

What happens to the debts?

The opening judgment freezes pre-existing liabilities: individual enforcement actions stop, pre-judgment debts cannot be paid, and interest is suspended. Claims must be filed to be included in the plan.

Frequently asked questions

How long does receivership last?

The observation period lasts 6 months, renewable once, capped at 18 months. A recovery plan can then run for up to 10 years.

What is the deadline to file a claim?

Two months from publication of the opening judgment in the BODACC. After that the claim is time-barred unless relief from forfeiture is granted.

Does the director stay in charge?

In principle yes: the director keeps managing, possibly assisted or supervised by the administrator depending on the mission set by the court.

Solvenda watches for you, every morning.

Solvenda monitors the BODACC by SIREN across your whole client portfolio and counts down the two-month claim deadline.

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