1E9Ct5D

During the preliminary insolvency period, the creditors’ committee may nominate apreliminary insolvency administrator (or in case of self administration, a preliminaryinsolvency trustee) to be appointed by the Court. The Court must approve thisnomination if the decision but the committee is unanimous and the candidate issuitable.The Insolvency Courts will usually appoint lawyers as preliminaryadministrators or preliminary insolvency trustees.When the Court appoints the preliminary insolvency administrator, it will usually enteran order mandating that some or all of the debtor’s transactions be subject to thepreliminary administrator’s consent. The debtor’s legal representatives remain incharge of conducting the debtor’s business. However, the Court has discretion togrant further powers to the preliminary administrator. The Court may go so far as totransfer to the preliminary administrator the power to run the debtor’s business. TheCourt usually grants the debtor protection from creditors’ collection attempts.Even if the Insolvency Court determines that grounds exist for the company to be inan insolvency proceeding, it will open final insolvency proceedings only if the Courtconcludes that the debtor’s estate has enough assets to cover the costs of theinsolvency proceedings. 17If the estate does not have sufficient assets to pay for theinsolvency proceedings, the Court will not open final insolvency proceedings.b. FranceFrance does not recognize the concept of a preliminary insolvency. When reviewinga petition for opening insolvency proceedings, the Court will determine whether thecompany is insolvent based on the information and documents provided with theinsolvency petition either by the company or by the other petitioning party .17 The Insolvency Court will often consult with the preliminary insolvency administrator to determine whetherinsolvency grounds exist, and whether the estate has sufficient assets to pay for the proceedings.12