Insolvency Law at Benin
Insolvency law in Benin is primarily governed by the Uniform Act Organizing Collective Proceedings for Wiping Off Debts, which is part of the OHADA (Organisation pour l'Harmonisation en Afrique du Droit des Affaires) legal framework. Benin, as a member state of OHADA, follows this uniform legislation which applies to all OHADA countries.
Key Features of Insolvency Law in Benin (under OHADA):
Types of Proceedings:
Preventive Settlement (Règlement Préventif): For debtors facing difficulties but not yet insolvent.
Judicial Reorganization (Redressement Judiciaire): To allow the business to continue, maintain employment, and settle debts.
Judicial Liquidation (Liquidation Judiciaire): For companies that can no longer be saved and must be dissolved.
Initiation:
Proceedings can be initiated by the debtor, creditors, or the public prosecutor.
The debtor is obligated to file within 30 days of cessation of payments.
Court Supervision:
Insolvency proceedings are court-managed and often involve the appointment of a trustee or administrator.
Protection from Creditors:
Once proceedings begin, individual creditor actions are suspended.
Role of Creditors:
Creditors are involved in meetings and may vote on recovery plans or liquidation decisions.
Cross-Border Insolvency:
The OHADA framework provides limited provisions for cross-border insolvency. International cooperation is still developing.
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