The number of business bankruptcies is on the rise again in France

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After two years of dead calm, activity is gradually returning to normal in the commercial courts. In the first quarter of 2022, according to figures from the Altares firm published on Monday April 11, 9,972 companies were subject to bankruptcy proceedings. A figure up 35% compared to the same period last year, but still significantly lower than the low level observed in 2018 and 2019, when around 14,000 defects were recorded in the first three months of the year. ‘year. In total, these two years totaled 107,000 insolvency proceedings, compared to just under 61,000 in 2020 and 2021. “We are less than half of the pre-crisis level of activity”, confirms Frédéric Abitbol, ​​President of the National Council of Judicial Administrators and Judicial Agents (CNAJMJ).

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The wave of bankruptcies, so dreaded at the start of the Covid-19 crisis, was contained by the “whatever the cost” policy, which made it possible to support companies faced with a fall, sometimes total, of their activity. This support represented a total of 240 billion euros in the form of loans – including 145 billion euros in loans guaranteed by the State, intended for 700,000 companies – and subsidies.

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The end of aid and the start of repayment of state-guaranteed loans explain why the number of defaults is on the rise again. These bankruptcies mainly affect young companies, less than five years old. Created shortly before the health crisis, they “ did not have time to meet their market, their activity did not really take off “, explains Thierry Millon, director of studies at Altares. They are particularly numerous among general food stores, small grocery stores or convenience stores which have not “held up”: defects in this sector of activity are three times more numerous in the first quarter of 2022 than in previous quarters.

Catering and very small businesses

Bankruptcies have doubled in a year in the traditional restaurant sector, which may not have seen as many customers return as expected. They also increased significantly in services to individuals, hairdressers and beauty salons. As these are mainly very small businesses, the impact in terms of jobs remains relatively low. “The cases we handled at the beginning of the year represent a total of 27,000 jobs, and overall the legal proceedings make it possible to save two thirds of them”, reminds Mand Abitbol.

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