Bankruptcy procedures (ma)
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Morocco > Private law > Commercial law
On 1996 the Moroccan legislator has adopted a new Code of commerce. The need to change the old code of commerce stem from the wish to renew the rules governing the commerce in order to ensure a real evolution of our economy and to encourage internal and external investments. Indeed, the old code which, had been signed into law the 08/12/1912, has been revealed inadequate with the requirements of the new data of the economy in the 21st century. In the new code of commerce, the most important innovation was the establishment of a new and modern system of bankruptcy. This new system is based on the procedures of prevention and treatment of difficulties encountered by business. The Moroccan legislator, inspired essentially by the French legislation, has adopted three kinds of procedures: the procedures of prevention, the procedure of treatment and the procedure of liquidation.
The Code of commerce has been signed into law the 1st August 1996[1], it consists of five books:
- the merchant;
- the business;
- the commercial papers;
- the commercial contracts;
- the difficulties of business
The fifth book entitled “the difficulties of business” organizes the bankruptcy system in Morocco, it’s divided on six titles: the procedures of prevention, the procedures of treatment of business’s difficulties, the procedure of liquidation, the common rules to procedures of treatment and procedure of liquidation, the punishment measures against the business’s managers and the appellate mechanisms. We will try on this introduction to explain successively these different procedures.
Contents |
1- The procedure of prevention
The Moroccan law has organized two procedures of prevention; the first consists on the internal prevention and the second on the external intervention.
The internal procedure of prevention starts when the business encounters some difficulties which may undermine its continuation. The auditor of the business or any shareholder may inform the manager of the existence of such difficulties during 8 days from their occurrence. Then, the manager of the business should find out a way to overcome these difficulties and straighten up the business. If not, he must convene the general meeting of shareholders in order to decide about the business situation in the light of the auditor report.
In the case in which the general meeting has not been convened, or when this meeting could not help to find out a solution to the difficulties of the business, the auditor would have to inform the president of the tribunal of commerce about this situation. The intervention of the tribunal opens the way to the external prevention.
When informed, the president of the tribunal convenes the business manager to his office for interview. The president has the faculties, in spite of any contrary provision, to ask the auditor, the public administrations, the representative of employees or any person for information which may give an exact image of the business’s situation. If he figures out that the difficulties could be overcome and the intervention of a third party may diminish the eventual differences between the usual partners of the business, he may appoint a special commissioner “mandataire spécial” to undertake certain mediation in order to straighten up the situation of the business.
Besides these two procedures, the Moroccan law has recognized a different procedure of prevention; it is called the amicable agreement. In fact, any commercial business could, if it is not in insolvency state “cessation of payments”, and if it suffers from a legal difficulty, economic difficulty, financial difficulty or any need which can not be remedied at by the own capacities of the business. The business’s manager has; in this case, to file a petition to the president of the tribunal in which he should explain the financial and social situation of his business and his needs of financing. As soon as the president receives this petition, he convenes the business’s manager to his office for interview. If he is convinced that the propositions given by the manager may help to the straightening up the business, he could open the procedure of amicable agreement. To do so, he appoints a mediator for a period of time that doesn’t exceed three months renewable for one month on the request of the mediator. The president determines the duties of the mediator which are the achievement of an agreement between the debtor and his creditors. If the mediator estimates that the stay of the individual remedies could help to the reach of an agreement, he could file a motion to the president of the tribunal. This latter could, after consultation with the principal creditors, order a stay of individual remedies for a time period that has to be in accordance with the mission of the mediator. Except the authorization of the president, the business manager is prohibited to pay any debt prior the commencement of the procedure.
When the mediator reaches an agreement with all the creditors, the president of the tribunal homologates it. If the agreement is concluded only with the principal creditors, the president my also approve it, however he should prescribe a new deadlines for the debtor to pay the rest of the creditors in accordance with the applicable laws. The agreement between the debtor and his creditors shall be made by writing, be signed by the parties and be dropped off in the tribunal clerk. During its implementation, the agreement produces an automatic stay of individual remedies. In case of the violation of this agreement by the debtor, the tribunal should order its termination and conceal the deadlines previously given to the debtor.
2- The procedures to treat the business’s difficulties
The procedures of prevention, previously discussed, occurred prior to the insolvency of the debtor. However, the procedures of treatment are implemented subsequently to the occurrence of the insolvency state. When the debtor is unable to pay his debts as they become due, he is insolvent and should file a reorganization procedure within the fifteen day as of the commencement of his insolvency. The procedure of reorganization may be opened also by any creditor. It may also be opened by the public office.
The Tribunal of commerce, subsequently to the petition of the debtor, the creditor or the public office, has to decide about the opening of the reorganization procedure. The tribunal is made up of three judges who have to make a decision after getting the explanations of the business manager and any person of interest. It’s important to underline that the trial takes place after private hearing and the decision is made within a time period of fifteen day as from the date of the petition. When the tribunal decides to open the reorganization procedure, he must pronounce a judgment in which he appoints a judge to supervise the procedure and a trustee to manage or assist in the management of the business. The duties of the trustee are invested with the clerk or any person appointed by the tribunal. The procedure of reorganization is intended to ensure the management of the business and its reorganization.
After the pronouncement of the judgment of reorganization, the enterprise continues it activities; however at any moment of the procedure, the tribunal on the request of the trustee, the debtor or the representative of creditors could order the cessation of the activity and pronounce the liquidation of the enterprise. During a period of time of four months (period of observation) after the declaration of insolvency, the trustee appointed by the tribunal has to prepare a financial, social and economic report about the situation of the business and propose either a plan of continuation or a plan of sale of the business.
The liquidation of the business constitutes the last solution, only if the financial situation of the business is completely compromised or irremediable that the tribunal may order the opening of this procedure.
See also
- Find the notion Bankruptcy procedures in the Moroccan legal internet
References
- ↑ Dahir n° 1-96-83 du 15 rabii 1417 (1er août 1996) portant promulgation de la loi n° 15-95 formant Code de commerce, adoptée par la Chambre des représentants le 24 hija 1416 (13 mai 1996), Official Bulletin n° 4418, thursday October 3rd 1996
