All talk and no trousers

Situation

Even if your company is doing business with a multinational, dealing with an unpaid invoice is very common. In fact, in our experience, we have seen that multinationals have worse payment behaviour than small businesses. Our French Desk helped a company on one such occasion.

Our client, who is a German provider of clothing and accessories conducted business with a leading French online fashion store. When the client delivered the goods, the French debtor refused to pay. Even after multiple attempts of contacting the debtor, phone calls and demand letters, there was no response. Despite being a well-known retailer in France, the counterparty remained completely silent.

Problem

When our client submitted their case to our lawyers at the French Desk, we immediately consulted the French commercial register. Our lawyers discovered that the French debtor was planning a merge and acquisition operation, that would help the company avoid paying their debts. By splitting the company into two different legal entities, one would keep the old name and registration number while the other would be a new company under a slightly different name. The new entity would receive all the assets while the old one would only keep the debts. Our lawyers at the French Desk discovered this as a planned operation during the Christmas holidays, thinking that their creditors would not notice.