Government measures in key jurisdictions 5th edition - Flipbook - Page 51
France
Contributor: Aramis Societe D’Avocats
Loans and
financial
support
•
Has the
government put in
place any new bank
funding schemes?
Aurélien Condomines condomines@aramis-law.com |
+33 (0) 1 53 30 77 00
Anne-Hélène Le Troccquer letrocquer@aramis-law.com |
+33 (0) 1 53 30 77 00
The Government has provided for a guarantee scheme to support bank
financing for businesses. Until December 31, 2020, companies (with the exception
of property companies & banks) may apply for State-guaranteed bank loans which
represent up to 25% of 2019 revenues (or two years of payroll for so-called
“innovative” companies or companies created since 1 January 2019). No repayment
will be required during the first year of the loan. For companies or groups of
companies of important size (>5000 employees or >1.5 billion EUR revenues in
France), this loan implies renouncing to distributing dividends in 2020. A decree of 6
May 2020 from the Ministry of the Economy and Finance extended the beneficiaries
of this scheme to certain non-trading real estate companies, companies in difficulty
since 1 January 2020, “Young Innovative Companies” and loans granted through
crowdfunding/ participatory financing platforms.
The mechanism of “partial unemployment” has been facilitated for companies whose
employees cannot work because of the Covid situation. Employers get a
What financial support reimbursement of 60% of the employee’s gross salaries up to a (relatively high)
monthly threshold. Employers which must stop their activities because of
is the government
governmental decision (i.e. restaurant or large shopping centres) get a
providing to
reimbursement of 70% of the employees gross salaries up to a (relatively high)
businesses and
monthly threshold.
to individuals on
employment issues?
Employment
Insolvency
•
No substantial rules were enacted on insolvency. Deadlines have been extended to take
into account the lockdown situation and commercial courts, who are in charge
of insolvency proceedings, have put in place specific emergency procedures in order to
be able to handle urgent matters. One specific rule presumes that the financial situation
of companies filing for insolvency shall be assessed as it was on March 12, 2020.
•
Specific rules have been enacted to suspend or extend the effects of certain
contractual deadlines (except for financial obligations and guarantees listed in art. L21136 of the French Financial and Monetary Code). The principle is that periodic penalty
payments, penalty clauses, termination clauses sanctioning the failure to fulfil an
obligation within a specified period shall be deemed not to have commenced or to
have taken effect if that period has expired during the “lockdown period” (as defined by
the government as a period ending on June 23). They shall take effect from the expiry of
a period of one month after the end of that period if the debtor has not performed his
obligation before that time. The ending date of the protection period has been set to
June 23, 2020. In addition, when an agreement may be terminated only during a
specified period or when it is renewed if no termination is notified within a specified
period, that period shall be extended, if it expires during the “lockdown period”, by two
months after the end of the “lockdown period”. Further, for agreement which can only
be terminated in a defined schedule or which are automatically renewed in the absence
of denunciation within a limited period: those periods or deadlines are extended if they
expire between 12 March and 2 months after the expiry of the “lockdown period”.
No longer applicable.
Has the
government made
any changes
to insolvency
legislation?
Contractual
Issues
What measures
have been taken
to reinforce
contracts?
•
Government measures in key jurisdictions
51
