CEd Relance: protecting companies in crisis

Laurence Vandeplas is a lawyer at the Brussels bar and one of the experts at CEd Relance. We talk about her commitment to supporting troubled companies and helping them avoid bankruptcy.

CEd Relance is supported by the Brussels Capital-Region and provides an invaluable resource for companies in difficulty. It offers workshops and training courses, helping companies to detect the first warning signs. This initiative brings together a range of experts to create tailor-made assistance, preventing bankruptcy and helping companies relaunch their business activities. Laurence Vandeplas is a lawyer at the Brussels bar and a specialist in insolvency law. Here, she talks about her role at CEd Relance.

Your're in charge of the « Sonnette d’alarme » training course for BECI's CEd Relance. Can you tell us a little more ?

Since last year I’ve been leading courses, alternating with my associate Dimitri Paternostre. We teach the tools available to struggling companies, together with how their directors can act on a legal level. We offer this training twice a month. The next session takes place on 14 November.

When do we start considering that a business is in difficulty?

Well, it depends on the sector and the company, but there are some general indicators. And the law has implemented an alarm system. When there’s a risk of bankruptcy, it means the company is in difficulty. We look at things like whether the company has outstanding late payments, or if a commercial lease has been terminated. We also ask whether any court judgements have been issued in relation to the company. The court is sometimes involved, but it’s often the entrepreneur who realises that they can’t pay their debts.

Why should companies turn to CEd Relance rather than a legal professional?

Under the BECI umbrella, CEd Relance offers help to company directors via a panel of experts, rather than simply lawyers. In the world of business, there are plenty of people who are competent in operational terms but who don’t necessarily know everything about accountancy, for instance. The CEd offers the opportunity to get advice in a very broad and diversified way, through an interview, whether it’s about accountancy, legal or social issues. Specialists help the entrepreneur to understand the problem, then to analyse the steps that can help the company to escape from the impasse, on a legal, financial or commercial level.

Just because a company is in difficulty doesn't mean it can't recover

We sometimes possess instincts or elements that aren’t necessarily visible to the entrepreneur in their daily business, and which, under the eye of an external expert, can help them restore the balance. Following the consultation with the CEd, we recommend the company to perhaps introduce a JRP or to call in a business mediator.

Is CEd Relance the last solution before bankruptcy?

Just because the company is having problems doesn’t mean it can’t turn the corner. That’s why it’s important to consult with specialists, to see what tools are available to try to save the company and avoid bankruptcy or liquidation. Often the thing that allows a company to be saved is simply talking to its creditors. Open communication with creditors is essential in finding solutions that are viable over the longer term.

What are the main causes of problems for companies?

The main one is cash flow. We currently have a case where a company is going to receive a large sum, but not for another twelve months. Meanwhile it’s struggling to pay employees and creditors. And of course, this is a major problem because in a year’s time the company will have plenty of money. But it’s got to last long enough to reach that point.

Have recent crises led to an increase in the number of businesses that are struggling?

A number of crises have followed in quick succession, and this has obviously had an impact. For example, the COVID crisis led to many businesses closing down. We’ve also had an energy crisis, which has increased costs for every business. There’s also automatic salary indexation which increases costs, and raw materials have become more expensive too. And of course, all of this means that businesses have seen their costs increasing significantly in recent years, which is naturally a big problem for companies.