As a general principle, insolvency law is conducted under the auspices of the local Commercial Court. There are three main types of insolvency protection: the sauvegarde (safeguard) procedure, when a debtor is in serious financial difficulties but not technically insolvent; the recovery procedure (redressement judiciaire) when a debtor is insolvent but the business might be able to financial vialibility; the liquidation proceure (liquidation judiciaire) when there is no hope of recovery.
If a contracting party has an unpaid receivable with the debtor, it will be necessary to register a claim with the insolvency practitioner appointed by the court. Care should be taken as there are strict time-bars for making claims both initially and at later stages when the claim could be subject to challenge.
If a contracting party has an ongoing contract with the debtor, the decision about whether the contract should continue to be performed lies with the insolvency practitioner.
If a contracting party has goods or machines or inventory at the premises of the debtor a specific procedure will need to be followed in order to be able to retake possession of those assets.