Distressed companies
Distressed companies in Tunisia: amicable settlement, judicial settlement, bankruptcy
What exactly does Law No. 2016-36 cover?
The text brings together the procedures of amicable settlement, judicial settlement, judicial liquidation for economic difficulties, bankruptcy, and the related procedures: making good the company’s liabilities and extension of bankruptcy.
The reform was far-reaching. It touched the Commercial Code, the 1995 legislation on the rehabilitation of companies in economic difficulty, the Code of Obligations and Contracts, the Labour Code, the Commercial Companies Code and the Code of Real Rights.
What is the purpose of the rescue regime?
The rescue regime aims to help a distressed company continue its activity, maintain jobs and pay its debts. The logic is not to wind up but to preserve what can be preserved.
It has three connected stages: notification of signs of economic difficulty, amicable settlement, then judicial settlement where the first has not sufficed.
Timing is the decisive factor. A company that flags its difficulties early has options — negotiation, rescheduling, partial disposal — that a late filing removes.
When should signs of difficulty be notified?
Notification of signs of economic difficulty opens the mechanism. It is not an admission of failure: it is the entry point to the protective regime.
Waiting until payment becomes altogether impossible means forfeiting amicable settlement and facing the heaviest procedures directly, with increased personal risk for directors — the law expressly provides for making good the company’s liabilities and for extension of bankruptcy.
Can the business be sold rather than liquidated?
A sale is one of the outcomes contemplated by the rescue mechanism: it transfers the business, and with it the jobs, instead of scattering the assets in a liquidation.
A sale carried out within collective proceedings is nonetheless governed by its own rules, distinct from a private treaty sale: creditors’ rights and employees’ position are tightly framed. This is ground where improvisation is expensive.
What a director should prepare
- Document the real financial position: proceedings open on evidence, not on assertions.
- List creditors, their security and their ranking — treatment differs with the nature of the claim.
- Assess the director’s personal exposure, particularly regarding liability for the company’s debts.
- Do not miss the window for amicable settlement: that is where negotiating room is greatest.
Frequently asked questions
Which law governs distressed companies in Tunisia?
Law No. 2016-36 of 29 April 2016 on collective procedures, which reformed amicable settlement, judicial settlement, judicial liquidation and bankruptcy.
What are the stages of the rescue regime in Tunisia?
Three stages: notification of signs of economic difficulty, amicable settlement, then judicial settlement. The aim is to continue the business, maintain jobs and pay the debts.
Can a director be held personally liable in a bankruptcy?
Law No. 2016-36 expressly provides for procedures making good the company's liabilities and for extension of bankruptcy, which can reach directors. Exposure should be assessed in advance.
Sources
- Law No. 2016-36 of 29 April 2016 on collective procedures — full text
- Distressed companies and collective procedures — Tunisian Association of Capital Investors
This article provides general legal information, current as of 19 August 2026. It is not legal advice and does not replace an assessment of your specific situation. Only the texts published in the Official Gazette of the Republic of Tunisia are authoritative.