Restructuring and Insolvency in Senegal 2024

Restructuring and Insolvency in Senegal 2024 – Senegal’s Supreme Court

RESTRUCTURING AND INSOLVENCY 2024

SENEGAL

Malick Lô, Maty Rose Lopy, Mohamed Kamil, Anne Marie Mendy, Rinwa Hachem

(Houda Law Firm)

GENERAL

Legislation

What main legislation is applicable to insolvencies and reorganizations?

Insolvency issues and reorganization procedures are governed by the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC).

Excluded entities and excluded assets

What entities are excluded from customary insolvency or reorganization proceedings and what legislation applies to them? What assets are excluded or exempt from claims of creditors?

The AUPC applies to private individuals and legal entities. Conversely, legal entities governed by public law are excluded from the usual insolvency or reorganization procedures. Specific regulations apply to certain activities, which may exclude them from the usual insolvency or reorganization procedures. These may include banking regulations, which lay down specific rules.

Food claims are exempt from creditors’ claims. Similarly, under article 99 of the AUPC, the spouse of a debtor who is subject to receivership or liquidation proceedings may repossess his or her own assets and bear the debts and security interests attached to his or her assets.

Creditors may not take advantage of benefits granted by one spouse to the other. Persons who own property in the debtor’s estate have a right of revendication, which is strictly governed by articles 101 to 103 and 106 of the aforementioned AUPC. The seller of movables also benefits from certain guarantees provided for in articles 104 and 105 of the AUPC.

Public enterprises

What procedures are followed in the insolvency of a government-owned enterprise? What remedies do creditors of insolvent public enterprises have?

If the company is a public company in the form of a legal entity under private law, the AUPC will apply and the procedures for receivership and winding up may be applied in order to pay off creditors (article 1-1 of the AUPC).

If the company is part of the semi-public sector and falls into the category of public establishments, it will be necessary to apply Framework Law No. 2022-08 of 19 April 2022 relating to the semi-public sector, the monitoring of the state’s portfolio and the control of private legal entities receiving financial assistance from the public authorities. Article 45 of this law states that ‘[p]ublic companies shall be wound up under the conditions laid down by the provisions of the AUSGIE.

For each winding-up of a semi-public sector entity decided by the State, a monitoring and control committee shall be set up, the organizational and operational rules of which shall be laid down by decree’.

Pursuant to article 223 of the Uniform Act relating to the law of commercial companies and economic interest groupings (AUSCGIE), corporate creditors may apply to the competent court for the opening of a judicial winding-up if they can prove that they have a legitimate interest in requesting the opening of such proceedings.

Protection for large financial institutions

Has your country enacted legislation to deal with the financial difficulties of institutions that are considered ‘too big to fail’?

The AUPC does not contain a rule specifically applicable to institutions considered ‘too big to fail’. There is no special legislation created solely to protect them from possible financial difficulties. The AUPC concerns all private companies.

Courts and appeals

What courts are involved? What are the rights of appeal from court orders? Does an appellant have an automatic right of appeal or must it obtain permission? Is there a requirement to post security to proceed with an appeal?

The Commercial Court has jurisdiction over collective proceedings, in particular receivership and winding-up proceedings. According to article 3-1 of the AUPC, the court with territorial jurisdiction to hear the proceedings referred to in this act is the court within whose jurisdiction:

the natural person debtor has his principal place of business on national territory; or
the debtor, a legal person, has his registered office on the national territory.

If the principal place of business or the registered office is abroad, the proceedings shall take place before the court within whose jurisdiction the principal place of business of the debtor, whether an individual or a legal entity, is located on the national territory.

The court of the registered office or principal place of business of the legal entity also has jurisdiction to order the preventive settlement, judicial reorganization or winding-up of the assets of persons jointly and severally liable for the liabilities of the legal entity.

With regard to appeals against court decisions, decisions concerning the opening of judicial reorganization or winding-up proceedings may be appealed. This appeal must be lodged within fifteen days of the decision being handed down.

It is not necessary to obtain prior permission to appeal. The right to appeal is automatic.

TYPES OF LIQUIDATION AND REORGANIZATION PROCESSES

Voluntary liquidations

What are the requirements for a debtor commencing a voluntary liquidation case and what are the effects?

The Uniform Act relating to the law of commercial companies and economic interest groupings (AUSCGIE) provides for the possibility of dissolving the company, which will result in its winding-up (article 201 AUSCGIE). In the context of the amicable winding-up provided for by AUSCGIE, the winding-up procedure begins once the liquidator has been appointed. If the liquidator discovers that the company is in suspension of payments, collective proceedings will have to be opened, involving the intervention of the court.

The dissolution of the company will not result in its removal from the Trade and Personal Property Credit Register. This deletion is, in principle, only obtained after the winding-up operations have been completed at the request of the liquidator.

Voluntary reorganizations

What are the requirements for a debtor commencing a voluntary reorganization and what are the effects?

In order for the debtor to be able to initiate reorganization proceedings, it must be in a state of suspension of payments and have reached an agreement with its creditors that has been approved by the court. For the proceedings to be initiated, the debtor must make a declaration within 30 days of the cessation of payments.

This declaration must then be filed with the clerk of the court with jurisdiction in the matter, and the debtor will receive a receipt. This declaration must be accompanied by several documents listed in article 26 of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC (articles 25 and 26)).

Once judicial reorganization has been granted, the debtor must be assisted in all acts relating to the administration and disposal of his assets. If he is not assisted, the acts may be unenforceable (article 52 of the AUPC). The trustee will be required to take precautionary and emergency measures and to draw up an inventory of the debtor’s assets. In the context of judicial reorganization, the liquidator will have the task of requiring the debtor to make all the tax and social security declarations for which he is responsible.

Successful reorganizations

How are creditors classified for purposes of a reorganization plan and how is the plan approved? Can a reorganization plan release non-debtor parties from liability and, if so, in what circumstances?

The reorganization plan is set out in what the AUPC calls the draft composition.

In this draft composition, the debtor must, within 60 days of the decision to open the reorganization (at the most), demonstrate the various prospects for reorganization of the company and the solutions envisaged for reorganization (article 27). Article 28 of the AUPC sets out the various measures that must be included in the draft composition, but does not specify that the reorganization plan may release the non-debtor parties from their liability.

Once the draft composition is proposed by the debtor, it will be filed with the registrar, who will be required to inform the creditors and forward it to the liquidator (article 119).

The liquidator must then draw up a report verifying the positions of the debtors and creditors regarding the draft composition agreement and is required to draw up an economic and social report (section 119). This report will then be sent to the official receiver before the composition meeting is convened (article 119). Following submission of the liquidator’s report, a vote of the creditors will be organized.

The final draft judicial reorganization agreement will be voted on by ‘a majority in number of the creditors admitted definitively or provisionally, representing at least half of the total amount of the claims’. (article 125). Minutes will then be drawn up by the court with jurisdiction to record what was decided at the composition meeting (article 126). The court with jurisdiction in the matter will be required to verify the serious nature of the proposed composition before pronouncing the opening of the judicial reorganization (article 33).

If the conditions laid down in article 127 of the AUPC are met, the competent court will order the homologation of the composition.

As regards the classification of creditors, they are classified according to the nature of the claim. For example, the AUPC distinguishes between preferential creditors and unsecured creditors. The classification of creditors is set out in articles 166 and 167.

Creditors are classified as follows in the event of winding-up.

Real estate

The proceeds from the realization of the real estate are distributed in the following order:

to creditors benefiting from the preferential right provided for in articles 5-11, 11-1 and 33-1 of the AUPC;
to creditors of the legal costs incurred in realizing the property sold and distributing the price;
to creditors of super-privileged wages in proportion to the value of the property in relation to the total assets;
to creditors holding a conventional or forced mortgage and to separatist creditors registered within the legal time limit, each according to the rank of their registration in the land register;
creditors of the general body of creditors as defined by article 117 of the AUPC;
creditors with a general lien in accordance with the order established by the Uniform Act Organizing Securities (ie, creditors with a general lien subject to disclosure, each in accordance with the rank of his entry in the Trade and Personal Property Credit Register, and creditors with a general lien not subject to disclosure in accordance with the order established by article 180 of that Uniform Act);
to unsecured creditors with a writ of execution; and
to unsecured creditors without a writ of execution. In the event of there being insufficient funds to pay in full the creditors of one of the categories designated in (1), (2), (3), (5), (6), (7) and (8) above, who rank equally, they shall contribute to the distributions in proportion to their total claims, on a pro rata basis.

Movable property

Without prejudice to the exercise of any right of retention or exclusive right to payment, the funds arising from the realization of movables are distributed in the following order:

to creditors benefiting from the lien provided for in articles 5-11, 11-1 and 33-1 of the AUPC;
to creditors of the legal costs incurred in realizing the property sold and in distributing the price itself;
to creditors of costs incurred for the preservation of the debtor’s property in the interest of the creditor whose titles are prior in date;
to creditors of super-privileged wages in proportion to the value of the item of furniture in relation to the total assets;
creditors guaranteed by a general lien subject to publicity, a collateral or a pledge, each on the date on which it becomes effective against third parties;
to creditors with a special movable lien, each on the item of movable property to which the lien relates;
creditors of the general body of creditors as defined by article 117 of the AUPC;
creditors with a general lien according to the order established by the Uniform Act Organizing Securities;
unsecured creditors with a writ of execution; and
unsecured creditors without a writ of execution. In the event of insufficient funds to pay in full the creditors of one of the categories designated in (1), (2), (3), (4), (7),(8) and (9) above, who rank equally, they contribute to the distributions in proportion to their total claims, on a one-for-one basis.

Involuntary liquidations

What are the requirements for creditors placing a debtor into involuntary liquidation and what are the effects? Once the proceeding is opened, are there material differences to proceedings opened voluntarily?

The AUPC allows creditors to request the opening of winding-up proceedings (article 28); one of the conditions for this request is that creditors must have a claim that is certain, liquid and due.

The creditor must specify the amount and nature of the claim, as well as the title on which the claim is based. Once winding-up has been declared, the company or other legal entity will be dissolved (article 53). The debtor will then be divested of ‘the administration and disposal of his present assets and those that he may acquire in any capacity whatsoever, on pain of such acts being unenforceable, except in the case of conservatory acts’. (article 53).

Throughout the winding-up proceedings, the liquidator will be required, as the debtor’s representative, to carry out or exercise the debtor’s actions, deeds and rights relating to his assets.

In addition, once the winding-up proceedings have been opened, the creditors’ estate will be constituted and represented by the liquidator, and the registration of movable and immovable securities will be halted, as will the interruption and prohibition of any legal action by creditors forming part of the estate, in accordance with article 75 of the AUPC. Several other suspensive effects are provided for in articles 72 et seq of the AUPC.

The opening of winding-up proceedings entails the production and verification of claims in accordance with articles 78 et seq of the aforementioned act. Winding-up puts an end to the company’s activities.

Unlike amicable winding-up, which remains an option for shareholders when the company is not in suspension of payments, involuntary winding-up may be requested by creditors when the company is in suspension of payments. The procedures are therefore very different, and one of the material differences is that in the amicable procedure a liquidator will be appointed, whereas in the (involuntary) winding-up procedure there is no such body.

However, there is no difference between a winding-up (due to cessation of payments) requested by the debtor itself and a winding-up requested by a creditor.

Involuntary reorganizations

What are the requirements for creditors commencing an involuntary reorganization and what are the effects? Once the proceeding is opened, are there any material differences to proceedings opened voluntarily?

The AUPC allows creditors to apply for judicial reorganization (article 28); one of the conditions for this application is that creditors must have a claim that is certain, liquid and due.

The creditor must specify the amount and nature of the claim, as well as the title on which the claim is based. From the date of the decision declaring the judicial reorganization until the approval of the judicial reorganization agreement or the conversion of the judicial reorganization into a winding-up of assets, the debtor is required to be assisted by the liquidator in all acts relating to the administration and disposal of his assets, failing which the liquidator’s acts will be unenforceable. Judicial reorganization of assets does not put an end to the business, which continues with the assistance of the trustee.

There are no real material differences between voluntary reorganization (requested by the debtor) and involuntary reorganization (requested by the creditor).

Expedited reorganizations

Do procedures exist for expedited reorganizations (eg, ‘prepackaged’ reorganizations)?

The AUPC provides for the existence of a simplified judicial reorganization, the procedure for which is set out in articles 145 et seq. This procedure applies to small companies. The rules relating to judicial reorganization will be applicable to simplified judicial reorganization subject to the provisions of articles 145 et seq.

Unsuccessful reorganizations

How is a proposed reorganization defeated and what is the effect of a reorganization plan not being approved? What if the debtor fails to perform a plan?

If the conditions set out in articles 125 and 127 of the AUPC are not met, the competent court will issue a decision rejecting the composition. Once this rejection decision has been handed down, it will allow the judicial reorganization to be converted into winding-up proceedings (article 126).

If the debtor does not fulfil the commitments made in the composition agreement or the deadlines and remissions that have been granted, the composition agreement may be rescinded. However, in order for the composition to be rescinded, the competent court will have to assess whether the debtor’s breaches are sufficiently serious to definitively compromise performance of the composition.

In the event that the debtor’s defaults are not sufficiently serious, the competent court may decide to grant payment deadlines, provided that these do not exceed by more than six months those already granted by the creditors (article 139).

Corporate procedures

Are there corporate procedures for the dissolution of a corporation? How do such processes contrast with bankruptcy proceedings?

The AUPC does not provide a procedure for the dissolution of companies. The dissolution of a legal person is simply a consequence of the decision pronouncing the winding-up of its assets (article 53). However, the AUSCGIE does provide for a dissolution procedure.

The winding-up procedure leading to the dissolution of the company starts when the debtor ceases to pay. In addition, the dissolution of the company provided for by the AUSCGIE may be pronounced in the event of the company’s operation being blocked as a result of disagreement between the partners.

Conclusion of case

How are liquidation and reorganization cases formally concluded?

Winding-up proceedings are closed pursuant to article 170 of the AUPC. According to this provision:

When the operations of winding-up of the assets are completed, and in any event at the expiry of the time limit set out in article 33, paragraph 3, above, even if the assets have not been fully realized, the receiver, the debtor present or duly summoned by the registrar by hand-delivered letter against a receipt or by registered letter with acknowledgement of receipt or by any means in writing, shall submit his accounts to the official receiver who, by official report, shall record the completion of the winding-up operations.

Furthermore, concerning judicial reorganization proceedings, article 136 of the AUPC provides that ‘[a]s soon as the homologation decision has become res judicata, the debtor recovers the free administration and disposal of his assets with the exception of those which have been the subject of an assignment in accordance with articles 131 to 133 above’. It can therefore be said that when the decision to homologate the judicial reorganization agreement has become res judicata, the debtor regains his freedom to manage his assets, subject to certain exceptions.

INSOLVENCY TESTS AND FILING REQUIREMENTS

Conditions for insolvency

What is the test to determine if a debtor is insolvent?

A debtor may be considered insolvent when it is in cessation of payments. This cessation of payments is defined in article 1-3 of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC) as ‘the state in which the debtor finds himself unable to meet his current liabilities with his available assets, with the exception of situations where the credit reserves or payment periods enjoyed by the debtor from his creditors enable him to meet his current liabilities’.

Mandatory filing

Must companies commence insolvency proceedings in particular circumstances?

It is possible to deduce from the provisions of the AUPC that when a debtor company is in suspension of payments, it will be possible to open judicial reorganization or winding-up of the assets proceedings. Where it appears irremediable for the company to pay off all its liabilities, it will be appropriate to opt for a winding-up of the assets. If the company’s situation is not irremediably compromised, it may opt for judicial reorganization (article 3).

DIRECTORS AND OFFICERS

Directors’ liability – failure to commence proceedings and trading while insolvent

If proceedings are not commenced, what liability can result for directors and officers? What are the consequences for directors and officers if a company carries on business while insolvent?

If the directors continue their activities despite the cessation of payments, they risk personal bankruptcy.

The competent court may declare the personal bankruptcy of directors who:

have committed serious misconduct other than that referred to in article 197 of the AUPC or have shown manifest incompetence;
have not declared, within thirty days, the cessation of payments by the legal person; or
have not paid the part of the corporate liabilities for which they are responsible.

Where the judicial reorganization or winding-up of the assets of a legal person reveals a shortfall in assets, the competent court may, in the event of mismanagement having contributed to the shortfall in assets, decide, at the request of the liquidator, the public prosecutor or two auditors under the conditions of article 72 paragraph 2 of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC), or even of its own motion, that the debts of the legal person are to be borne in whole or in part, with or without joint and several liability, by all or certain of the directors.

Directors’ liability – other sources of liability

Apart from failure to file for proceedings, are corporate officers and directors personally liable for their corporation’s obligations? Are they liable for corporate pre-insolvency or pre-reorganization actions? Can they be subject to sanctions for other reasons?

Apart from failure to initiate proceedings in good time, company officers and directors may be held liable if they have:

subtracted from their company’s accounts, misappropriated or concealed part of its assets or fraudulently acknowledged debts that did not exist;
carried on an independent professional, civil, commercial, craft or agricultural activity in their personal interest, either through an intermediary or under cover of a legal entity masking their actions;
used the credit or assets of a legal entity as their own;
through fraud, obtained for themselves or for their company a composition agreement which was subsequently annulled; or
committed acts of bad faith or inexcusable imprudence or seriously infringed the rules and customs of trade as defined in article 197.

The penalty that may be imposed in these situations is personal bankruptcy (article 196). The decision to declare personal bankruptcy automatically entails:

a general ban on trading and, in particular, on directing, managing, administering or controlling an individual commercial company or any legal entity;
disqualification from holding an elective public office and from being a voter for that public office; and
disqualification from holding any administrative, judicial or professional representative office.

Where the judicial reorganization or winding-up of the assets of a legal person reveals a shortfall in assets, the competent court may, in the event of mismanagement having contributed to the shortfall in assets, decide (at the request of the liquidator, the public prosecutor or two auditors under the conditions of article 72 paragraph 2 above, or even by its own motion) that the debts of the legal person are to be borne in whole or in part, with or without joint and several liability, by all or some of the directors.

Directors’ liability – defenses

What defenses are available to directors and officers in the context of an insolvency or reorganization?

In the context of a judicial reorganization or winding-up, the directors and officers may lodge an objection or appeal if they do not agree with the decisions.

However, the following decisions are not subject to objection or appeal:

decisions relating to the appointment or replacement of the official receiver, the appointment or dismissal of the receivers or the appointment or dismissal of the auditors;
decisions by which the competent court rules on appeals against decisions made by the official receiver within the limits of his powers;
the decision rendered by the competent court pursuant to article 111 of the AUPC, last paragraph; and
decisions authorizing the continuation of operations.

Shift in directors’ duties

Do the duties that directors owe to the corporation shift to the creditors when an insolvency or reorganization proceeding is likely? When?

Obligations do not ‘shift’ to creditors; however, certain deeds cannot be set up against creditors if they have been drawn up during the suspect period.

The following deeds cannot be set up against the general body of creditors if they are drawn up during the suspect period:

all gratuitous deeds transferring movable or immovable property;
any commutative contract in which the debtor’s obligations significantly exceed those of the other party;
any payment, by whatever means, of unmatured debts, except in the case of payment of a commercial paper;
any payment of matured debts, made otherwise than in cash, commercial paper, transfer, direct debit, payment or credit card, or legal, judicial or contractual set-off of debts that are related or any other normal method of payment or method commonly accepted in business relations in the debtor’s sector of activity;
any contractual security interest granted as security for a debt previously contracted, unless it replaces a previous security interest of at least an equivalent nature and scope or is granted in performance of an agreement entered into prior to the cessation of payments; and
any provisional registration of a protective judicial mortgage or protective judicial pledge.

Directors’ powers after proceedings commence

What powers can directors and officers exercise after liquidation or reorganization proceedings are commenced by, or against, their corporation?

In reorganization proceedings, the decision declaring judicial reorganization automatically entails, from the date of the decision and until approval of the composition agreement for judicial reorganization or conversion of judicial reorganization into winding-up of the assets, compulsory assistance of the debtor for all acts concerning the administration and disposal of its assets, on pain of such acts being unenforceable.

With regard to winding-up, the decision pronouncing the winding-up automatically entails, from the date of the decision until the closure of the proceedings, relinquishment by the debtor of the administration and disposal of his present assets and those that he may acquire in any capacity whatsoever, on pain of such acts not being enforceable, except in the case of conservatory acts.

MATTERS ARISING IN A LIQUIDATION OR REORGANIZATION

Stays of proceedings and moratoria

What prohibitions against the continuation of legal proceedings or the enforcement of claims by creditors apply in liquidations and reorganizations? In what circumstances may creditors obtain relief from such prohibitions?

The decision to open a judicial reorganization or winding-up of the assets interrupts or prohibits any legal action on the part of all the creditors making up the general body of creditors that seeks to order the debtor to pay a sum of money or terminate a contract for non-payment of a sum of money.

The decision to open the proceedings also halts or prohibits all enforcement proceedings by these creditors against both movable and immovable property, as well as any distribution proceedings that did not have an attributive effect prior to the decision to open the proceedings.

Doing business

When can the debtor carry on business during a liquidation or reorganization? Is any special treatment given to creditors who supply goods or services after the filing? What are the roles of the creditors and the court in supervising the debtor’s business activities?

Exceptionally, if the public interest or that of the creditors so requires, the competent court may authorize, in the decision pronouncing the winding-up of the assets, a provisional continuation of the activity for a maximum period of sixty days. It may renew this period once, for the same duration, at the request of the liquidator and after obtaining the opinion of the public prosecutor.

However, in judicial reorganization, the debtor or the managers of the legal entity participate in the continuation of the business, unless the competent court decides otherwise at the request of the liquidator, in a specially reasoned decision and after consulting the public prosecutor (article 113 of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC)).

Post-filing credit

May a debtor in a liquidation or reorganization obtain secured or unsecured loans or credit? What priority is or can be given to such loans or credit?

A debtor in reorganization proceedings may obtain guarantees to ensure that the composition plan is implemented, and banking institutions may grant loans for this purpose.

In the event of conversion of judicial reorganization proceedings into winding-up of the assets, the persons who had agreed in the judicial reorganization composition agreement to make a further cash contribution to the debtor with a view to ensuring the continuation of the debtor company’s activity and its long-term survival are paid under the lien in accordance with the ranks set out in articles 166 and 167 of the AUPC.

In the event of the opening of winding-up of the assets subsequent to the conclusion of a conciliation agreement homologated or exequaturé by the competent court or authority, the persons who had granted in the agreement a new cash contribution to the debtor with a view to ensuring the continuation of the activity of the debtor company and its perpetuation shall be paid under the lien according to the ranks provided for in articles 166 and 167 of the AUPC.

Persons who supply a new good or service with a view to ensuring the continuation of the activity of the debtor company and its continuity benefit from the same lien for the price of that good or service. Under no circumstances may the debtor’s creditors benefit from this privilege for claims arising prior to the opening of the conciliation.

Sale of assets

In reorganizations and liquidations, what provisions apply to the sale of specific assets out of the ordinary course of business and to the sale of the entire business of the debtor? Does the purchaser acquire the assets ‘free and clear’ of claims or do some liabilities pass with the assets?

The total or partial transfer of assets may concern all or part of the tangible or intangible, movable or immovable assets. Where the total or partial sale of assets or of a company or establishment is envisaged in the judicial reorganization composition, the liquidator must draw up a description of the movable and immovable assets whose sale is envisaged, a list of the uses to which they are put, the security interests to which they are subject and the share of each asset in the sale price.

The purchase offers are received by the debtor, assisted by the liquidator, and brought to the attention of the composition meeting, which decides to accept the most advantageous offer.

The competent court may only approve the total or partial sale of assets:

if the price is sufficient to pay off creditors with special security interests in the assets transferred, unless they waive this condition and accept the provisions of article 168 of the AUPC; and
if the price is payable in cash or if, if the purchaser is granted payment deadlines, these do not exceed two years and are guaranteed jointly and severally by a banking institution.

In principle, the purchaser acquires the assets ‘free and clear’ of any pre-sale claims. Unless otherwise specified in the sale plan, liabilities are not generally transferred to the buyer. Debts not covered by the sale remain the responsibility of the debtor or may be the subject of separate proceedings.

Where the assets sold include assets subject to a special security interest, the sale does not purge the security interest unless the price is paid in full and the creditor guaranteed by the security interest is discharged.

Negotiating sale of assets

Does your system allow for ‘stalking horse’ bids in sale procedures and does your system permit credit bidding in sales?

The legal system does not formally recognize the concept of ‘stalking horse’ offers as practised in other jurisdictions, notably the United States. Asset sale procedures in the context of winding-up or judicial reorganization are governed by the AUPC.

Rejection and disclaimer of contracts

Can a debtor undergoing a liquidation or reorganization reject or disclaim an unfavorable contract? Are there contracts that may not be rejected? What procedure is followed to reject a contract and what is the effect of rejection on the other party? What happens if a debtor breaches the contract after the insolvency case is opened?

Notwithstanding any legal provision or any contractual clause or indivisibility, no termination or resolution of a contract in progress may result solely from the opening of judicial reorganization or winding-up of the assets.

The liquidator alone has the power to demand performance of current contracts. He may be given formal notice by the co-contractor by hand-delivered letter against a receipt or by registered letter with acknowledgement of receipt or by any means that leaves a written trace, to take a decision on the continuation of current contracts. This formal notice starts a period of thirty days from receipt by the managing agent.

Where the liquidator requires the continuation of a current contract, he must provide the service promised to the other party and the latter must fulfil its obligations despite the debtor’s failure to fulfil commitments made prior to the decision to open the collective proceedings. Subject to this reservation, the contract is performed under the conditions in force on the date of the opening of the collective proceedings, notwithstanding any clause to the contrary.

Article 109 of the AUPC provides that the official receiver may terminate the contract ipso jure at the request of the other party:

if the liquidator does not respond to the formal notice provided for in article 108 of the AUPC within the time limit set, it being specified that the provision of the service promised to the other party before expiry of this time limit shall be deemed to be a decision to continue the contract; or
if the liquidator, after having demanded that the contract be continued, does not provide the service promised to the other party or in the event of non-payment of a due date in the case of a contract with performance or payment spread over time.

The official receiver may terminate the contract at the request of the liquidator:

provided that it does not excessively harm the interests of the other party to the contract, where the liquidator decides not to continue with the contract, in the absence of any formal notice or where, after having required performance of a current contract, it appears to him that this contract is not or is no longer useful for the continuation of the activity or the safeguarding of the debtor company; or
if, after having demanded the performance of a current contract in which the debtor’s performance relates to the payment of a sum of money, it appears to the liquidator that he will not be able to provide the promised service or, in the case of a contract with successive performance or payment spread over time, it appears to him that he will not have the necessary funds to fulfil the obligations of the following term.

Termination may give rise to damages, the amount of which is included in the liabilities of the judicial reorganization or winding-up of the assets. The co-contractor has a period of thirty days from the date of performance to pay these damages. These damages may be offset against claims arising from the non-performance of the contract prior to the decision to open insolvency proceedings.

Intellectual property assets

May an IP licensor or owner terminate the debtor’s right to use the IP when a liquidation or reorganization is opened? To what extent may IP rights granted under an agreement with the debtor continue to be used?

The termination of rights to use intellectual property can have a significant impact on the debtor’s activity. This may affect the value of the company’s assets and its ability to continue certain activities. A licensor or owner of intellectual property may terminate the right of use granted to the debtor under an agreement.

However, the ability to terminate these rights may be subject to court review and the specific provisions of the original agreement.

Personal data

Where personal information or customer data collected by a company in liquidation or reorganization is valuable, are there any restrictions in your country on the use of that information or its transfer to a purchaser?

Individuals’ rights to their personal data are protected, and restrictions exist to regulate how companies may use and transfer such data, even in the event of winding-up or reorganization proceedings.

Data must be collected or processed under the conditions set out in the legislation applicable to personal data.

Arbitration processes

How frequently is arbitration used in liquidation or reorganization proceedings? Are there certain types of disputes that may not be arbitrated? Can disputes that arise after the liquidation or reorganization case is opened be arbitrated with the consent of the parties?

The use of arbitration in winding-up or reorganization proceedings is not the norm, as these proceedings are administered by specialized courts and the rules in this respect are a matter of public policy.

Disputes arising during or after the commencement of winding-up proceedings may, in principle, be referred to arbitration if the parties agree and if the jurisdiction to decide the dispute does not lie exclusively with a state court.

CREDITOR REMEDIES

Creditors’ enforcement

Are there processes by which some or all of the assets of a business may be seized outside of court proceedings? How are these processes carried out?

There is the ‘commissary pact’ on movable or immovable property.

This is a special provision in a contract whereby it is expressly stipulated that if the claim is not paid, the creditor will automatically become the owner of the thing secured.

Unsecured credit

What remedies are available to unsecured creditors? Are the processes difficult or time-consuming? Are pre-judgment attachments available?

During the reorganization or winding-up proceedings, there is a stay of proceedings. No creditor may take enforcement action against the debtor.

CREDITOR INVOLVEMENT AND PROVING CLAIMS

Creditor participation

During the liquidation or reorganization, what notices are given to creditors? What meetings are held and how are they called? What information regarding the administration of the estate, its assets and the claims against it is available to creditors or creditors’ committees? What are the liquidator’s reporting obligations?

In accordance with the provisions of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC), during winding-up or reorganization creditors receive various notices. The court registrar, by publication in a legal gazette circulated from the place of the registered office of the competent court, informs creditors of the decision to open judicial reorganization or winding-up of the assets proceedings.

He shall also notify them, by an insertion in one or more legal gazettes of the Contracting State concerned, of the filing of the statement of claims. In addition, the Registrar shall send a notice to the creditors informing them of the rejection, in whole or in part, of their claim, by hand-delivered letter against receipt or by registered letter with acknowledgement of receipt or by any means in writing.

The liquidator is also required to notify the creditors every quarter of a report on the winding-up of the assets, unless the official receiver dispenses with this requirement.

Creditors known and domiciled in a foreign state must receive all notifications in the same way as creditors residing in a state party in the context of collective proceedings opened in accordance with the AUPC.

Creditor representation

What committees can be formed (or representative counsel appointed) and what powers or responsibilities do they have? How are they selected and appointed? May they retain advisers and how are their expenses funded?

One of the committees that can be formed is the liquidator, who represents the body of creditors constituted at the time of the decision to open judicial reorganization or winding-up of the assets proceedings. He acts on its behalf and in its collective interest, and can bind it. The liquidator’s role in the course of judicial reorganization or winding-up of the assets is exercised under the control of the official receiver.

There are also one or more controllers who may be appointed by the official receiver from among the non-employee creditors.

If there are more than 10 employees during the six months preceding the referral to the competent court, the liquidator invites the works council or the staff delegates to appoint an employee as controller within 20 days of the opening decision. Within the same period, in the absence of the aforementioned bodies, the trustee invites the employees to elect an employee from among their number.

The person thus nominated or elected is appointed by the official receiver as the controller representing the employees. For companies that do not reach this threshold, the official receiver appoints an employee as controller representing the staff.

The role of the controllers is to assist the liquidators in their duties and the official receiver in his task of supervising the progress of the judicial reorganization and winding-up of the assets and to look after the interests of the creditors. They always have the right to check the accounts and the statement of affairs presented by the debtor, to request an account of the state of the proceedings, the acts performed by the liquidator and the receipts and payments made.

The duties of controller are free of charge and must be performed personally.

Enforcement of estate’s rights

If the liquidator has no assets to pursue a claim, may the creditors pursue the estate’s remedies? If so, to whom do the fruits of the remedies belong? Can they be assigned to a third party?

In the event of winding-up of the assets due to insufficient assets, creditors do not recover the exercise of their actions against the debtor, unless the claim results from a criminal conviction of the debtor or from rights attached to the person of the creditor.

However, the guarantor of another person’s debt or the co-obligor who has paid in place of the debtor recovers the exercise of his rights of action against the debtor. By way of exception, all creditors, whether admitted or not, recover their individual debt collection rights:

if the debtor is declared personally bankrupt or if the debtor is convicted of bankruptcy;
if the competent court finds that the debtor has defrauded one or more creditors;
if the debtor or the legal entity of which the debtor was the director was subject to winding-up of the assets proceedings that were closed due to insufficient assets less than five years prior to the commencement of the proceedings to which the debtor is subject;
if the proceedings are a winding-up of the assets ordered against the director ordered to pay off the liabilities; or
if the collective proceedings were opened pursuant to article 189 of the AUPC.

Claims

How is a creditor’s claim submitted and what are the time limits? How are claims disallowed and how does a creditor appeal? Can claims for contingent or unliquidated amounts be recognized? Are there provisions on the transfer of claims and must transfers be disclosed? How are the amounts of such claims determined?

In accordance with articles 78 et seq of the AUPC, the creditors shall submit to the liquidator, by hand-delivered letter against a receipt or by registered letter with acknowledgement of receipt or by any means in writing, a declaration stating the amount of the claim due on the date of the decision to open the bankruptcy, the sums due and the dates on which they fall due. It must also specify the nature of any security that may be attached to the claim.

In addition, the claim must be submitted within a period starting from the date of the decision to open the judicial reorganization or the winding-up of the assets and ending 60 days after the second publication in a legal gazette of the state party concerned.

Creditors domiciled outside the national territory where the proceedings have been opened have 90 days to file their claims.

For creditors benefiting from a security that has been the subject of publicity or linked to the debtor by a published contract, the time limit for lodging claims only begins to run from the notification of the warning which must be given to them personally by the liquidator.

A claim is rejected in whole or in part by the official receiver after having heard or duly summoned the creditor, the debtor and the liquidator. The court clerk is responsible for notifying the creditors of the rejection of all or part of their claims. The creditors may lodge an objection against the decision of the official receiver, either directly with the court registry or by service by a bailiff or notification by any means capable of establishing actual receipt by the addressee, addressed to the court registry.

There are no specific provisions relating to the transfer of claims.

With regard to interest, it should be noted that creditors who are entitled to do so may not demand more than three years’ interest at the legal rate accruing from the decision to open the collective proceedings.

Set-off and netting

To what extent may creditors exercise rights of set-off or netting in a liquidation or in a reorganization? Can creditors be deprived of the right of set-off either temporarily or permanently?

Only the shareholders or partners who contribute to the increase in share capital provided for in the draft judicial reorganization composition may benefit from the set-off up to the amount of their admitted claims and within the limit of the reduction to which they are subject in the draft.

Modifying creditors’ rights

May the court change the rank (priority) of a creditor’s claim? If so, what are the grounds for doing so and how frequently does this occur?

Under the terms of article 168 of the AUPC, there are certain circumstances in which a creditor’s ranking may be modified. This is the case when the sale price of an asset specifically assigned to a security is insufficient to pay the principal and interest. In such cases, the creditor holding the security is treated as an unsecured creditor in respect of the unpaid balance of his claim.

Similarly, a creditor whose security is the only thing being contested is provisionally admitted as an unsecured creditor. The frequency of these circumstances is relative and depends on each case.

Priority claims

Apart from employee-related claims, what are the major privileged and priority claims in liquidations and reorganizations? Which have priority over secured creditors?

For funds arising from the realization of immovable property, the main preferential and priority claims are those of creditors who had granted a new cash contribution to the debtor with a view to ensuring the continuation of the debtor company’s activity and its long-term survival, and creditors of the legal costs incurred in realizing the asset sold and distributing the price.

In the case of funds from the sale of movable property, the main preferential and priority claims are those of creditors who had made a new cash contribution to the debtor in order to ensure the continuation of the debtor company’s activity and its continuity, creditors of legal costs incurred in order to realize the asset sold and distribute the price and creditors of costs incurred in preserving the debtor’s property in the interest of the creditor whose securities predate the date of the sale.

Employment-related liabilities

What employee claims arise where employees’ contracts are terminated during a restructuring or liquidation? What are the procedures for termination? (Are employee claims as a whole increased where large numbers of employees’ contracts are terminated or where the business ceases operations?)

In accordance with article 111 of the AUPC, employees have the right to lodge an objection against the decision authorizing or refusing the dismissals within 15 days of its pronouncement before the court that initiated the proceedings, which must render its decision within 15 days. They are also entitled to notice and to compensation for the termination of their employment contracts.

With regard to the procedure for terminating employment contracts, where redundancies for economic reasons are urgent and essential, the official receiver may authorize the liquidator to proceed. Before the matter is referred to the official receiver, the liquidator establishes the order of redundancies.

In the first place, redundancies are proposed for employees with the least professional aptitude for the jobs being maintained and, in the event of equality of professional aptitude, for employees with the least seniority in the debtor company, with seniority being calculated in accordance with the provisions of the applicable labor law.

With a view to obtaining their opinions and suggestions, the liquidator shall inform the staff representatives and the controller representing the staff in writing of the measures he intends to take, providing them with a list of the employees whose dismissal he is considering and specifying the criteria he has adopted. The staff representatives and the controller representing the staff must respond in writing within eight days of receipt of this request.

The order of redundancies drawn up by the receiver, the opinion of the staff delegates and that of the controller representing the staff, if they have been given, and the letter of communication to the labor inspectorate are submitted to the official receiver. The latter authorizes the proposed redundancies or certain redundancies if they prove necessary for the reorganization of the debtor company by decision served on the employees whose redundancy is authorized and, on the controller, representing the personnel if one has been appointed.

Pension claims

What remedies exist for pension-related claims against employers in insolvency or reorganization proceedings and what priorities attach to such claims?

The AUPC does not specifically provide for appeals in respect of pension claims.

However, in general, it should be noted that the following are not subject to appeal or opposition:

decisions relating to the appointment or replacement of the official receiver, the appointment or dismissal of receivers or the appointment or dismissal of controllers;
decisions by which the competent court rules on the appeal lodged against decisions rendered by the official receiver within the limits of his powers, with the exception of those ruling on claims and on the decision ordering the transfer by allocating a share of the transfer price to each of the assets transferred for the apportionment of the price and the exercise of preferential rights and that ordering an allocation of the funds between the creditors and the determination of the share;
the decision of the competent court authorizing or refusing the dismissals following the opposition lodged; and
decisions authorizing the continuation of the business, except in the case where a provisional continuation of the activity for a maximum period of 60 days is authorized on an exceptional basis, if the public interest or that of the creditors so requires.

In the event of unpaid contributions, the Institut de Prévoyance Retraite du Sénégal is considered to be the creditor. As such, in the order of distribution of the funds from the realization of the properties, it is classified in the fourth category in the same way as creditors holding a conventional or forced mortgage and separatist creditors registered within the legal time limit, each according to the rank of their registration in the land register.

As regards the distribution of funds from the realization of movables, it is classified in the fifth category, in the same way as creditors guaranteed by a general lien subject to publicity, a collateral, or a pledge, each according to the date on which it becomes effective against third parties.

Environmental problems and liabilities

Where there are environmental problems, who is responsible for controlling the environmental problem and for remediating the damage caused? Are any of these liabilities imposed on the insolvency administrator personally, secured or unsecured creditors, the debtor’s officers and directors, or on third parties?

There are no specific provisions relating to the management of environmental problems under the AUPC.

Liabilities that survive insolvency or reorganization proceedings

Do any liabilities of a debtor survive an insolvency or a reorganization?

In judicial reorganization, the activity is continued with the assistance of the trustee. Winding-up of the assets, on the other hand, puts an end to the debtor company’s activity.

Distributions

How and when are distributions made to creditors in liquidations and reorganizations?

It is up to the official receiver to order, if necessary, a distribution of the funds among the creditors. The receiver determines the amount and ensures that all creditors are notified.

As soon as the distribution has been ordered, the liquidator sends each eligible creditor, in payment of his dividend, a cheque made payable to him and drawn on the account opened. The amount of the assets, after deduction of the costs and expenses of the winding-up of the assets, as well as any relief granted to the debtor or his family, is distributed among all the creditors whose claims have been accepted.

SECURITY

Secured lending and credit (immovables)

What principal types of security are taken on immovable (real) property?

The security taken over immovable property is a mortgage.

Secured lending and credit (movables)

What principal types of security are taken on movable (personal) property?

The securities that may be taken over movable property are the right of retention; the property retained or assigned as security; the pledge of tangible movable property; the pledge of intangible movable property; and liens.

CLAWBACK AND RELATED-PARTY TRANSACTIONS

Transactions that may be annulled

What transactions can be annulled or set aside in liquidations and reorganizations and what are the grounds? Who can attack such transactions?

The 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC) provides that from the date of cessation of payments until the date of the decision to open judicial reorganization or winding-up of the assets, certain acts may not be relied on as against the creditors. These include:

all gratuitous acts transferring ownership of movable or immovable property;
any commutative contract in which the debtor’s obligations significantly exceed those of the other party;
any payment, by whatever method, of debts that have not fallen due, except in the case of payment of a commercial paper;
any payment of debts that have fallen due, made otherwise than in cash, commercial paper, transfer, direct debit, payment or credit card; or
legal, judicial or contractual set-off of debts that are related to each other or to any other.

The action for a declaration of unenforceability may only be brought by the liquidator. It falls within the jurisdiction of the court that opened the reorganization or winding-up of the assets proceedings. On pain of inadmissibility, this action may not be brought after homologation of the judicial reorganization composition or after closure of the winding-up of the assets.

If the transaction is annulled, the general body of creditors is collateralized in the place of the creditor whose security has been declared unenforceable – the general body of creditors benefits from the unenforceability.

Equitable subordination

Are there any restrictions on claims by related parties or non-arm’s length creditors (including shareholders) against corporations in insolvency or reorganization proceedings?

The AUPC does not regulate subordinated debt.

Lender liability

Are there any circumstances where lenders could be held liable for the insolvency of a debtor?

If lenders have improperly supported a debtor whom they knew to be in a state of suspension of payments, they may be held liable if, as a result of their actions, they have worsened the debtor’s situation.

GROUPS OF COMPANIES

Groups of companies

In which circumstances can a parent or affiliated corporation be responsible for the liabilities of subsidiaries or affiliates?

Group companies are legally independent and operate autonomously in their own field of activity. This principle of legal independence means that the debts of each group company can be considered separately and distinctly. As a result, the debts of one group company cannot bind another group company. Thus, in principle, the parent company should not be liable for the debts of its subsidiaries insofar as, notwithstanding their economic subordination, the latter retain full legal autonomy.

As a result, the creditors of one of the companies in the group cannot extend their proceedings to the group; they can only obtain payment from the company with which they have contracted.

It follows from the provisions of article 179 of the Uniform Act relating to the law of commercial companies and economic interest groupings that the subsidiary has its own assets and is solely liable for its liabilities.

In addition, where one of the companies is in judicial reorganization or winding-up, the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts allows the liability of the directors of the group companies to be called into question if they have de jure or de facto directed the subsidiary that is in default of payment.

Combining parent and subsidiary proceedings

In proceedings involving a corporate group, are the proceedings by the parent and its subsidiaries combined for administrative purposes? May the assets and liabilities of the companies be pooled for distribution purposes?

Each member company in a group is a separate legal entity with its own legal personality. As such, each company is responsible for its own assets and liabilities.

It is therefore not possible for the parent company and its subsidiaries to be combined for administrative purposes and for their assets and liabilities to be pooled for distribution purposes.

INTERNATIONAL CASES

Recognition of foreign judgments

Are foreign judgments or orders recognized, and in what circumstances? Is your country a signatory to a treaty on international insolvency or on the recognition of foreign judgments?

Foreign court decisions are enforceable in Senegal if the request for enforcement is made by means of an exequatur application and this application is enforced by a Senegalese court under articles 354 et seq of the Senegalese Code of Civil Enforcement Procedures.

The exequatur is granted under the conditions of articles 787 et seq of the Senegalese Code of Civil Enforcement Procedures. Once exequatur has been granted, judicial decisions handed down by foreign courts will have the force of res judicata if:

the decision emanates from a court with jurisdiction under Senegalese conflict of laws rules;
the decision applied the law applicable to the dispute, in accordance with Senegalese conflict of laws rules;
the decision is final and enforceable under the law of the state where the judgment was given;
the parties were duly summoned, represented or declared in default;
the decision does not contain any element contrary to public policy or morality in Senegal; and
the dispute has not already been judged by a competent Senegalese court.

Apart from the incorporation into Senegalese law of the 2015 OHADA Uniform Act Organizing Collective Proceedings for Clearing of Debts (AUPC) based on the 1997 UNCITRAL Model Law on Cross-Border Insolvency, we are not aware of any convention or treaty on cross-border insolvency to which Senegal has acceded.

UNCITRAL Model Laws

Have any of the UNCITRAL Model Laws on Cross-Border Insolvency been adopted or is adoption under consideration in your country?

Apart from the incorporation into Senegalese law of the AUPC based on the 1997 UNCITRAL Model Law on Cross-Border Insolvency, we are not aware of any convention or treaty on cross-border insolvency to which Senegal has acceded.

Foreign creditors

How are foreign creditors dealt with in liquidations and reorganizations?

Judicial reorganization or winding-up of the assets may be initiated at the request of any creditor, regardless of the nature of the claim, provided that it is certain, liquid and due.

To this end, the creditor must specify the nature and amount of the claim and endorse the document on which it is based.

In practice, and in accordance with article 28 of the AUPC, the creditors of a company have the right and interest to request the opening of a collective procedure as long as their claims are certain, liquid and due and that they are attested by supporting documents placed in the file.

Cross-border transfers of assets under administration

May assets be transferred from an administration in your country to an administration of the same company or another group company in another country?

It is possible to transfer assets from Senegal to another country, in the form of a transfer of all assets and liabilities, which offers companies the opportunity to restructure their activities abroad in an efficient manner.

In accordance with article 201 of the Uniform Act relating to the law of commercial companies and economic interest groupings, ‘the dissolution of a company in which all the shares are held by a single shareholder entails the transfer of all the company’s assets and liabilities to that shareholder, without there being any need for winding-up’.

In practical terms, this involves transferring all the assets and liabilities of a company to an acquiring company, which may be located abroad. The decision by the sole shareholder to transfer all the company’s assets and liabilities to the sole shareholder is published in a legal gazette. This publication is important because it opens the 30-day opposition period for creditors from the date of its publication, and the date of the transfer of assets and liabilities will only be realized and the company will only disappear at the end of the opposition period.

The foregoing applies only in the context of an amicable winding-up.

As in a conventional winding-up procedure, the transfer of all of a company’s assets and liabilities to its partner will result in the company’s disappearance. As a result, the company will no longer have a legal existence, and the absorbing company will completely replace it.

COMI

What test is used in your jurisdiction to determine the COMI (center of main interests) of a debtor company or group of companies? Is there a test for, or any experience with, determining the COMI of a corporate group of companies in your jurisdiction?

Apart from the registered office, we are not aware of any criteria or tests for determining the COMI of a company or group of companies in Senegal.

Cross-border cooperation

Does your country’s system provide for recognition of foreign insolvency proceedings and for cooperation between domestic and foreign courts and domestic and foreign insolvency administrators in cross-border insolvencies and restructurings? Have courts in your country refused to recognize foreign proceedings or to cooperate with foreign courts and, if so, on what grounds?

The AUPC includes international law provisions allowing for the recognition in OHADA countries of insolvency proceedings opened abroad and providing for cooperation with foreign courts and tribunals.

Under articles 256-24 to 256-26, the competent insolvency court shall cooperate with foreign courts or their representatives to the extent possible. Cooperation may take place directly or through a representative. The competent court may communicate directly with foreign courts to request information or assistance. Similarly, the liquidator, under the supervision of the competent court, cooperates with foreign courts or representatives in the performance of his duties.

Co-operation may take various forms, including the appointment of a person or body to act on the instructions of the competent court, the communication of information by any appropriate means determined by the competent court, or the co-ordination of concurrent insolvency proceedings concerning the same debtor.

Cross-border insolvency protocols and joint court hearings

In cross-border cases, have the courts in your country entered into cross-border insolvency protocols or other arrangements to coordinate proceedings with courts in other countries? Have courts in your country communicated or held joint hearings with courts in other countries in cross-border cases? If so, with which other countries?

See question 11.6.1.

Winding-up of foreign companies

What is the extent of your courts’ powers to order the winding-up of foreign companies doing business in your jurisdiction?

Article 3-1 of the AUPC provides that the court with territorial jurisdiction to hear all the proceedings referred to in this instrument is the court in whose jurisdiction:

the debtor, a natural person, has his principal place of business on the national territory; or
the debtor, a legal person, has its registered office on the national territory.

If the debtor’s principal place of business or registered office is abroad, the proceedings shall be brought before the court in whose jurisdiction the debtor’s principal place of business, whether an individual or a legal entity, is located on national territory. In addition, the court of the registered office or principal place of business of the legal entity also has jurisdiction to order judicial reorganization or winding-up of the assets of the persons jointly and severally liable for the liabilities of the legal entity.

Any dispute as to the jurisdiction of the court seized must be settled by that court within fifteen days of the matter being referred to it and, in the event of an appeal, within 30 days by the court of appeal.

If the court declares that it has jurisdiction, it must also rule on the merits of the case in the same decision as it can only be challenged on jurisdiction and the merits of the case by way of appeal (article 3-2 of the AUPC).

UPDATE AND TRENDS IN RESTRUCTURING AND INSOLVENCY IN SENEGAL

Trends and reforms

Are there any emerging trends or hot topics in the law of insolvency and restructuring? Is there any new or pending legislation affecting domestic bankruptcy procedures, international bankruptcy cooperation or recognition of foreign judgments and orders?

There are no updates that we are aware of.

* The information in this chapter was accurate as at January 2024.

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