French Commercial code
In forceI. - Notwithstanding any legal provision or any contractual clause, no indivisibility, termination or resolution of a current contract may result from the sole fact of the opening of safeguard proceedings.
The co-contractor must fulfil its obligations despite the debtor's failure to perform commitments made prior to the opening judgment. Failure to perform these undertakings only gives rise to a right in favour of the creditors to a declaration of liabilities.
II. - The administrator alone has the power to require performance of current contracts by providing the promised service to the debtor's co-contractor.
In the light of the forecast documents available to him, the administrator shall ensure, at the time he requests performance of the contract, that he will have the necessary funds to ensure the resulting payment. In the case of a contract with performance or payment staggered over time, the administrator shall terminate the contract if it appears to him that he will not have the necessary funds to fulfil the obligations of the following term.
III. - The current contract is terminated ipso jure:
1° After a formal notice to take a decision on the continuation of the contract sent by the co-contractor to the administrator and remaining unanswered for more than one month. Before the expiry of this period, the official receiver may set the administrator a shorter period or grant him an extension, which may not exceed two months, to take a decision;
2° In the absence of payment under the conditions defined in II and the agreement of the other party to continue contractual relations. In this case, the public prosecutor, the administrator, the judicial representative or a controller may refer the matter to the court for the purpose of terminating the observation period.
IV. - At the request of the administrator, termination is ordered by the juge-commissaire if it is necessary to safeguard the debtor and does not excessively harm the interests of the co-contractor.
V. - If the administrator does not make use of the option to continue the contract or terminates it under the conditions of II or if termination is ordered pursuant to IV, non-performance may give rise to damages in favour of the other party, the amount of which must be declared as a liability. The co-contractor may nevertheless defer restitution of the sums paid in excess by the debtor in performance of the contract until the damages have been adjudicated.
VI. - The provisions of this article do not apply to contracts of employment. Nor do they concern a trust contract, with the exception of an agreement in execution of which the debtor retains the use or enjoyment of property or rights transferred to a fiduciary estate.
