In February, your French SAS is short of cash but still trading. You, the founder living abroad, hold a 45,000-euro credit balance in your shareholder current account (compte courant d’associé, the loan you made to your own company). You ask the company to wire the money back, it does, and you breathe again. In June, the company files for insolvency (cessation des paiements, the legal state of being unable to meet due liabilities with available assets). In September, the court-appointed liquidator (liquidateur judiciaire) writes to you in London, New York or Dubai demanding restitution of the 45,000 euros, arguing the payment occurred during the suspect period (période suspecte, the window running from the date of cessation of payments to the opening judgment). Can the French court really cancel a repayment made to a shareholder who was genuinely owed the money, and how do you defend the payment from thousands of kilometres away? This guide is general in scope: it describes the checks and defences useful in any comparable situation and states no finding about any particular company. This guide explains the suspect-period nullities that threaten any repayment received before an insolvency filing, what the Rennes Court of Appeal decided in April 2025 in a case about current-account repayments of 46,743 euros, and the practical file that protects a foreign founder. It explains every French acronym as it goes: greffe (the registry office of the commercial court), BODACC (the official bulletin publishing insolvency openings), URSSAF (the social security collection agency), DGFIP (the French tax administration), and mandataire judiciaire (the insolvency representative). If you have not yet structured the financing itself, read first our guide on choosing the right French vehicle (SAS, SARL, branch or subsidiary) as a foreign founder and our companion guide on funding the company through a shareholder current account, interest caps and repayment; what follows starts where those guides stop, when the company can no longer pay everybody.

I. Which Repayments Does the French Court Cancel in the Period Before the Insolvency Opening?

A. Is Repayment of a Debt That Was Not Yet Due Automatically Void?

The suspect period is the stretch of time between the date on which the court finds the company stopped paying its debts and the judgment opening the insolvency proceedings (redressement judiciaire, judicial reorganisation, or liquidation judiciaire, judicial liquidation). French law treats payments made inside that window with suspicion because a failing company may be tempted to favour one creditor, often its own shareholder or director, over the others. The core weapon is Article L632-1 of the Commercial Code, which lists the acts that are void as of right when they occurred after the cessation date. It opens with the principle: “Sont nuls, lorsqu’ils sont intervenus depuis la date de cessation des paiements, les actes suivants” (Article L632-1, Commercial Code). No proof of fraud is needed and no proof of your knowledge is needed: if the act is on the list and falls inside the window, the court must declare it void.

Three items on that list directly threaten repayments to a founder. First, “Tout paiement, quel qu’en ait été le mode, pour dettes non échues au jour du paiement” (Article L632-1, 3°, Commercial Code). A debt is due (échue) when the creditor can demand immediate payment. A shareholder current account with no fixed term is normally repayable on demand: the Court of Cassation recalled in 2025 that “sauf stipulation contraire, tout associé était en droit d’exiger à tout moment et peu important les motifs de sa demande le remboursement du solde de son compte courant, dès lors que l’avance ainsi consentie constituait un prêt à durée indéterminée” (Court of Cassation, Commercial Chamber, 12 February 2025, appeal no. 23-17.483, full decision on courdecassation.fr). But a current account frozen by a blocking agreement (convention de blocage) until a future date, or a loan contract with a fixed maturity that has not arrived, is not yet due: repaying it early during the suspect period falls squarely under the automatic nullity. Second, “Tout paiement pour dettes échues, fait autrement qu’en espèces, effets de commerce, virements, bordereaux de cession visés par l’article L. 313-23 du code monétaire et financier ou tout autre mode de paiement communément admis dans les relations d’affaires” (Article L632-1, 4°, Commercial Code). A normal bank wire (virement) is safe on this ground; a set-off against unrelated claims, a transfer of stock or equipment in kind, or an exotic netting arrangement is not. Third, “Toute sûreté réelle conventionnelle ou droit de rétention conventionnel constitués sur les biens ou droits du débiteur pour dettes antérieurement contractées” (Article L632-1, 6°, Commercial Code). Taking a pledge over the company’s assets or a mortgage to secure your old shareholder loan during the suspect period is void, unless it merely replaces an earlier security of equivalent nature and scope.

A Rennes case from April 2025 shows how courts combine these rules with current accounts in practice. A company had issued two cheques totalling 46,743 euros shortly before filing: one covering the manager-shareholder’s personal social security arrears by crediting his current account, the other paid to him directly. The company filed its cessation statement in June 2023, the court opened liquidation the same month and set the cessation date back to December 2021, and the liquidator sued for restitution. The first judges declared both payments void as of right and ordered the shareholder to return 46,743 euros to the proceedings. On appeal, the Rennes court partially recharacterised the basis but kept the result: it set aside the automatic-nullity reasoning and instead declared the payments void on the knowledge-based ground, confirming the restitution order for the full amount (Rennes Court of Appeal, 3rd Commercial Chamber, 29 April 2025, RG 24/05153). For a founder abroad, the message is stark: routing company money to yourself or your personal debts through the current account in the months before a filing is exactly the pattern liquidators attack first, and courts order the money back even when the underlying claim was real.

The civil-law nature of the advance does not save it. Article 1892 of the Civil Code defines the loan as a contract “par lequel l’une des parties livre à l’autre une certaine quantité de choses qui se consomment par l’usage, à la charge par cette dernière de lui en rendre autant de même espèce et qualité” (Article 1892, Civil Code). That definition proves you were a genuine creditor, but the suspect-period nullities do not ask whether the debt was genuine; they ask when it was paid and whether it was due. A real loan repaid too early, or through an abnormal channel, is cancelled all the same, and the refund goes to the collective proceedings for distribution among all creditors.

B. Can the Court Cancel Payment of a Due Debt When You Knew the Company Was Failing?

Most shareholder current accounts are repayable on demand, so most repayments concern debts that were technically due. Those payments escape the automatic nullity but face a second, wider net: Article L632-2 of the Commercial Code provides that “Les paiements pour dettes échues effectués à compter de la date de cessation des paiements et les actes à titre onéreux accomplis à compter de cette même date peuvent être annulés si ceux qui ont traité avec le débiteur ont eu connaissance de la cessation des paiements.” (Article L632-2, Commercial Code). Three conditions must coincide: the payment occurred after the cessation date, the debt was due, and the recipient knew the company had ceased payments. Unlike the automatic list, annulment here is optional (“peuvent être annulés”), but in practice courts use it readily against insiders.

Knowledge is the battleground, and a shareholder-director living abroad starts from a weak position. Courts infer knowledge from the functions held, access to the accounts, family or group ties, and the circumstances of the payment: a president who signs the transfer order days before the filing, or a parent company that receives weekly cash reports, will struggle to claim ignorance. The Rennes decision illustrates the evidentiary dynamic: the appellate judges moved the case from automatic nullity to the knowledge-based ground and still cancelled the payments, which means they considered the insider’s awareness sufficiently established. The same article extends the net to enforcement steps: “Toute saisie administrative, toute saisie attribution ou toute opposition peut également être annulée lorsqu’elle a été délivrée ou pratiquée par un créancier à compter de la date de cessation des paiements et en connaissance de celle-ci” (Article L632-2, Commercial Code). Racing to seize the company’s bank balance through a bailiff (huissier de justice, now titled commissaire de justice) after the cessation date therefore offers no shelter if you knew the situation.

One statutory shelter deserves mention because founders sometimes rely on it by mistake. Article L632-3 states that “Les dispositions des articles L. 632-1 et L. 632-2 ne portent pas atteinte à la validité du paiement d’une lettre de change, d’un billet à ordre ou d’un chèque.” (Article L632-3, Commercial Code). Paying yourself with a company cheque does not immunise the payment: the same article immediately allows the insolvency representative to bring a restitution action (“action en rapport”) against the beneficiary of a cheque or the first endorser of a promissory note “s’il est établi qu’ils avaient connaissance de la cessation des paiements”. In the Rennes case, the payments were made by cheque and were cancelled anyway. Form never defeats substance in this field.

Two further boundaries complete the picture. First, once the opening judgment is handed down, Article L622-7 provides that “Le jugement ouvrant la procédure emporte, de plein droit, interdiction de payer toute créance née antérieurement au jugement d’ouverture, à l’exception du paiement par compensation de créances connexes.” (Article L622-7, Commercial Code). After the opening, the company itself is forbidden from repaying your old current account, and any payment you extract exposes you to restitution plus potential sanctions. The only narrow corridor is set-off of closely connected claims (compensation de créances connexes), which requires a genuine substantive link between the two debts, not an accounting contrivance. Second, employee-related and certain withheld-tax payments enjoy a targeted carve-out at the end of Article L632-2, but shareholder loan repayments are not among them. Do not confuse the protection of wage claims with your own position as a lending shareholder: the statute protects the company’s employees, not its financiers.

II. How Do You Defend the Payment and Limit Personal Exposure From Abroad?

A. How the Period Before the Opening Is Dated, and How You Challenge That Date From Outside France

Everything turns on the cessation date, because it opens the review window. The substantive test sits in Article L631-1: the procedure is opened for a debtor who, “dans l’impossibilité de faire face au passif exigible avec son actif disponible, est en cessation des paiements”, while a debtor who shows that credit reserves or creditor moratoria let him meet due liabilities with available assets “n’est pas en cessation des paiements” (Article L631-1, Commercial Code). In plain English, the question is cash-flow insolvency at a given date: could the company pay its due debts with its liquid assets and usable credit lines? A profitable company awaiting a large receivable can still be in cessation if nothing liquid covers the payroll due Friday. For your defence, reconstruct the treasury position at the payment date: bank statements, confirmed overdraft facilities, documented payment extensions granted by suppliers, and the ageing of receivables. If those papers show the company could still pay its due debts when you were repaid, the payment predates the suspect period and the nullities do not apply.

The procedural rule is Article L631-8: “Le tribunal fixe la date de cessation des paiements après avoir sollicité les observations du débiteur.” (Article L631-8, Commercial Code). If the judgment sets no date, cessation is deemed to coincide with the opening judgment. Crucially, the date “peut être reportée une ou plusieurs fois, sans pouvoir être antérieure de plus de dix-huit mois à la date du jugement d’ouverture”, at the request of the insolvency representative, the administrator or the public prosecutor, after hearing the debtor. In practice, the liquidator routinely asks the court to push the date backwards, sometimes to the eighteen-month maximum, precisely to catch earlier repayments such as yours. In the Rennes case, the opening judgment of June 2023 carried a cessation date of December 2021, which pulled payments from December 2022 and January 2023 into the window. A founder abroad must therefore treat the published cessation date as provisional: monitor the BODACC entry for the opening, and instruct counsel to file observations opposing any backward extension with treasury evidence. French courts accept written observations and representation by counsel, so physical presence in France is not required, but deadlines are short and missing them makes the extended date final.

Distance also affects your standing as a creditor in the proceedings. If the repayment is cancelled, you do not simply lose the money: you may file (déclarer) your original current-account claim in the liabilities for the amount ordered to be returned, subject to the filing deadline running from the BODACC publication, currently two months for creditors in France and four months for creditors domiciled abroad. A creditor living outside France who misses the deadline must seek a court-ordered late filing (relevé de forclusion), granted sparingly and never as of right. Declare early, in euros, with the loan agreement, the account ledger and the restitution judgment attached, and appoint a French address for service (domicile élu) with your counsel so that no procedural notice goes astray.

B. What Shields a Repayment, What Exposes the Director, and What Are the Paris Practicalities?

No defence is automatic, but four lines of argument carry weight when the file supports them. First, contemporaneous consideration: if your current-account advance funded a specific, documented company expense days before the repayment (a supplier paid, a deposit released), present the paired wires to show the company was not impoverished by the round trip. Second, ordinary-course normality: a repayment by standard bank wire, of an on-demand balance, in an amount consistent with prior practice and recorded transparently in the books, looks far less like favouritism than an urgent lump sum combined with unusual entries. Third, absence of knowledge under Article L632-2: a purely passive minority shareholder abroad who received automated monthly statements showing a healthy balance, with no management role and no warning signs communicated, can credibly dispute awareness of the cessation, whereas a president who signed the company’s own cessation declaration cannot. Fourth, timing arithmetic: any payment made before the final cessation date, as ultimately fixed after all challenges, escapes the window entirely, which is why contesting the backward extension of the date is often more valuable than disputing the payment itself.

The mirror risk is personal liability for keeping the company alive on shareholder cash instead of filing. Article L651-2 provides that “Lorsque la liquidation judiciaire d’une personne morale fait apparaître une insuffisance d’actif, le tribunal peut, en cas de faute de gestion ayant contribué à cette insuffisance d’actif, décider que le montant de cette insuffisance d’actif sera supporté, en tout ou en partie, par tous les dirigeants de droit ou de fait, ou par certains d’entre eux, ayant contribué à la faute de gestion.” (Article L651-2, Commercial Code). The same article adds that “en cas de simple négligence du dirigeant de droit ou de fait dans la gestion de la personne morale, sa responsabilité au titre de l’insuffisance d’actif ne peut être engagée”, so ordinary carelessness is not enough (Article L651-2, Commercial Code), but deliberately delaying the mandatory filing while repaying yourself first is the textbook pattern courts sanction. The filing duty itself is strict: once cessation is established, management must file within forty-five days. A founder-director abroad who continues to take repayments during that period cumulates the restitution risk on the payment with a personal contribution order on the shortfall. The safe sequence is the reverse: stop all insider repayments at the first serious cash-flow doubt, have an accountant certify the treasury position weekly, and file early rather than bridging with one more related-party movement.

Paris and Île-de-France add practical specifics worth integrating. Companies registered with the Paris greffe litigate cessation dates and nullity actions before the Paris commercial court (tribunal des activités économiques de Paris), one of the busiest in France, where nullity writs must be drafted with precision because the docket leaves little room for correction. BODACC publications for Paris companies appear under the Paris registry, and the two-month or four-month claim-filing deadline runs from that publication regardless of where you live. Keep a complete bilingual defence file with your Paris counsel or accountant from the first sign of difficulty: the signed loan and blocking agreements, every wire advice both ways with foreign-exchange slips, the current-account ledger, monthly bank statements, board minutes recording the treasury reviews, and the auditor’s correspondence. When the liquidator’s demand letter arrives from Paris, that file lets counsel answer within days with a dated, sourced position on exigibility, payment method, knowledge and timing, instead of reconstructing the story across time zones under a court deadline.

Conclusion

A repayment of your shareholder current account made months before the insolvency filing is not safe by default: if the court places it after the cessation date, an early repayment of a not-yet-due balance is void as of right, and even a due-debt repayment by ordinary wire can be cancelled when the insider knew the company had stopped paying its debts. The Rennes restitution order for 46,743 euros of current-account payments shows that courts follow the money back into the proceedings even when the underlying claim was genuine. Your defence from abroad rests on three pillars built before any filing: documented proof that the debt was due and paid through normal channels, a dated treasury file capable of moving the cessation date forward, and an immediate halt to insider repayments at the first cash-flow doubt, followed by a timely filing. With those elements, the suspect period remains what the statute intended, a shield for the collective body of creditors, rather than a trap that turns bridge finance from a founder into a personal refund order. Act early, document everything in writing, and treat every insider repayment in a fragile company as a payment a judge may one day review line by line.