Introduction of Economic Activity Courts

The recent law on justice programming provides for the introduction, on an experimental basis, for a period of 4 years of a dozen or so courts with a special jurisdiction over prevention and handling of business difficulties.

These courts, composed of judges chosen among the Commercial Courts’ judges and other judges recruited from the farming sector and a court clerk, will handle cases relating to economic difficulties encountered by businesses which may entail or lead to the designation of a recovery administrator, amicable settlements between farmers, conciliation, safeguard, receivership and/or compulsory liquidation proceedings, regardless of the status (sole proprietorship, licensed self-employed professional, commercial or civil company, agricultural group, non-profit organization) and the activity (commercial, craft, licensed self-employed, agricultural) of the company or organization facing economic difficulty (with the exception of regulated legal professions, which will continue to remain under the jurisdiction of the ordinary courts).

Reminder: Under the existing French judicial system, the Commercial courts have jurisdiction over prevention and handling of economic difficulties faced by companies engaged in commercial or craft activities and all companies designed as commercial entities while carrying out non-commercial, including agricultural, activities.

The Economic Activities’ Courts will have the authority to hear cases and disputes relating to commercial leases when they arise from or in connection with safeguard, receivership, or compulsory liquidation proceedings.

The rules of procedure applicable before the Economic Activities’ Courts will be those currently applicable before the Commercial courts. However, there is one key difference: companies with more than 250 employees must pay a financial contribution to be able to bring their case before the Economic Activities’ Courts.

Representation by a lawyer before the Economic Activities’ Courts will be optional as it is the case for the Commercial courts.

(1) Tribunaux des Activités Économiques (TAE)