The short answer
Redressement judiciaire (RJ) is a procedure under the French Commercial Code (art. L631-1 et seq.) opened by the court when a company is insolvent but can be rescued. An observation period of 6 months, renewable up to 18 months, ends with a continuation plan, a sale plan to a third-party buyer, or conversion into liquidation. In a sale plan, the buyer acquires assets without the prior debts.
- Legal basis
- Art. L631-1 et seq. Commercial Code
- Observation
- 6 months, up to 18
- Outcomes
- Continuation, sale or liquidation
- Debts
- Not taken over by the buyer
Companies and businesses in receivership (RJ) for sale
What is redressement judiciaire?
Receivership is opened, on the director's filing or a creditor's petition, when the company cannot meet due liabilities with available assets, without its situation being irretrievably compromised. Unlike liquidation, the director generally stays in place, assisted or supervised by a court-appointed administrator. A creditors' representative (mandataire judiciaire) acts for creditors. The legal goals: keep the business running, preserve jobs and settle debts.
The 6 stages of an acquisition in receivership
- 1
Opening judgment
The court records insolvency, opens the RJ and appoints a supervising judge, a creditors' representative and often an administrator. Published in the BODACC.
Day 1 - 2
Observation period
Trading continues. The administrator prepares an economic and social review and may launch a call for takeover offers if a continuation plan looks uncertain.
6 to 18 months - 3
Call for offers and data room
The administrator publishes a sale notice, sets a filing deadline and opens a data room to candidates who sign a confidentiality undertaking.
3 to 6 weeks - 4
Firm offer
The offer is written, priced and compliant with article L642-2: scope, price, jobs kept, financing, business forecasts. It must be filed at least two business days before the hearing (art. R642-1).
Deadline - 5
Court hearing
The court hears the administrator, creditors' representative, public prosecutor and employee representatives, then selects the offer that best secures jobs, creditor payment and sustainability.
1 hearing - 6
Sale plan judgment
The buyer takes over, along with contracts designated by the court and the employees kept. Transfer deeds are then signed.
A few weeks
RJ vs liquidation vs safeguard
| Safeguard | Receivership (RJ) | Liquidation (LJ) | |
|---|---|---|---|
| Insolvent | No | Yes | Yes |
| Rescue possible | Yes | Yes | Clearly impossible |
| Director | Stays in place | In place, assisted or supervised | Removed |
| Key officer | Administrator (optional) | Administrator + creditors' rep. | Liquidator |
| Route for a buyer | Partial sale (rare) | Sale plan | Asset sale or sale plan |
Who does what in an RJ
The court-appointed administrator
Assists or supervises the director, runs the call for offers and reviews takeover bids. The buyer's main contact.
The creditors' representative
Acts for creditors, verifies claims and gives an opinion on offers.
The supervising judge
Oversees the procedure and protects the interests involved.
The commercial court
Opens the RJ, rules on the observation period and approves the continuation or sale plan.
Why acquire a company in receivership?
Receivership often allows you to acquire a business that is still trading: customers, teams, know-how, production assets and leases are usually in place. The buyer acquires the assets defined in the offer, without prior debts. In return, the offer is binding, the timeline is short and no warranties are given.
- Going concern: revenue, customers and staff in place
- Prior debts not transferred to the buyer
- Price usually below a private sale
- Choice of scope: assets, contracts and jobs specified in the offer
- Binding offer: secure financing before the deadline
Mistakes to avoid
- Finding the deal too late: filing deadlines are short.
- Underestimating restart cash needs (working capital, stock, wages).
- Offering a price with no employment plan: jobs weigh heavily with the court.
- Overlooking leases and key contracts to be transferred.
- Filing an incomplete offer that does not meet article L642-2.
Frequently asked questions about receivership
What does RJ mean?
RJ stands for redressement judiciaire, the French insolvency procedure opened by the commercial court when a company is insolvent but its business can be rescued.
Can you buy a company in receivership in France?
Yes. When a continuation plan is not workable, the administrator launches a call for offers. Any third party can bid; the court approves a sale plan in favour of the selected buyer.
Does the buyer take on the debts?
Generally no. The sale plan transfers assets and designated contracts without prior debts, which stay in the procedure. Some charges, such as security over financed assets, may follow the asset.
How long does receivership last?
The observation period lasts 6 months, renewable once, and exceptionally up to 18 months in total. A call for takeover offers usually runs for 3 to 6 weeks.
When must a takeover offer be filed?
Before the administrator's deadline, and at least two business days before the hearing (art. R642-1). It can then only be improved, not reduced.
Can the director buy back the company?
Article L642-3 bars the director and relatives from bidding, unless the court grants an exception at the public prosecutor's request.
Receivership vs liquidation?
Receivership aims to save the business through continuation or sale, with an observation period. Liquidation is ordered when rescue is clearly impossible; the goal becomes selling the assets.
What happens to employees?
Contracts for the jobs kept transfer to the buyer. Redundancies for the other jobs are authorised by the sale plan judgment and handled within the procedure.
Where can I find companies in receivership for sale?
Judgments are published in the BODACC and calls for offers are circulated by administrators. areprendre.com gathers RJ opportunities with revenue, location, court and deadline.
Do I need a lawyer?
It is not mandatory, but being assisted by a lawyer is advisable to analyse the file, define the scope and draft a compliant offer.
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