The French Court of Cassation recognises the direct effects in France of the British insolvency proceedings on the ownership of the debtor’s assets.

Information from the Commercial Litigation Department – Insolvency (Me Catherine Ottaway and Me Georges-Louis Harang) :

On 8 June 2010, the County Court of Luton (UK) declared the personal bankruptcy of a debtor and appointed the liquidator of his assets. The liquidator directly exercised the debtor’s powers over a property located in France, which was contested by a French co-owner but rejected.

In a judgment of 16 July 2020 (no. 17-16.200), the French Court of Cassation ruled that :

-Article 26 of Regulation (EC) No 1346-2000 of 29 May 2000 allows any Member State to refuse to recognise insolvency proceedings opened in another Member State or to enforce a judgment given in such proceedings where such recognition or enforcement would produce effects manifestly contrary to its public policy, in particular its fundamental principles or the rights and freedoms of individuals guaranteed by its constitution. The Court of Justice of the European Union has ruled that recourse to the public policy clause should be made only in exceptional cases (CJEU, First Chamber, 21 January 2010, Case C-444/07, Mg Probud Gdynia sp. z o.o., paragraph 34).

-The rule of transfer to the liquidator of the property of the debtor, a natural person, placed in judicial liquidation, resulting from English law, does not produce effects that are manifestly contrary to the French concept of international public policy. The Court of Appeal, which recognised the right of Mr B… to act in the division of the joint ownership between Mr X… and Mrs C… of property located on French territory as a consequence of the recognition of the opening of insolvency proceedings in England for Mr X… has correctly applied the texts referred to in the plea.