Administrative attachment by a third-party holder (SATD): its effect on the ranking of other creditors

A public accountant (comptable public) serves an administrative attachment by a third-party holder on a company's bank, the day after a supplier creditor has had an attachment of debts served on the same account. The balance is insufficient to satisfy both. The finance department wants to know what remains available to pay salaries, the private creditor wants to know whether it is outranked by the Treasury's preferential right, and the banker, as garnishee (tiers saisi), wants to know to whom it must pay without incurring liability. In a context where business failures have been at a high level since 2023 according to Banque de France statistics, this situation is no longer exceptional. This guide deals with the competition between the Treasury's SATD and the ordinary attachment of debts (saisie-attribution): who prevails, on what date, what the effects are on the bank balance, what the time limits for challenge are, and what the opening of collective insolvency proceedings changes.

What the SATD has unified and what it entails in law

The administrative attachment by a third-party holder (saisie administrative à tiers détenteur, SATD) results from Article 73 of Law No. 2017-1775 of 28 December 2017, the amending finance law for 2017, which entered into force on 1 January 2019. It is codified in Article L. 262-1 of the French Tax Procedure Code (livre des procédures fiscales, LPF). It absorbed four procedures that previously coexisted: the notice to a third-party holder (avis à tiers détenteur, ATD) in tax matters, the third-party holder objection for claims of local authorities, the administrative objection for fines, and the former attachment by a third-party holder. A single instrument, a single regime.

The mechanism is simple in principle. The public accountant, holding an enforceable title that the accountant has issued, directs a third party holding sums belonging to the taxpayer to pay them over directly. There is no prior recourse to a judge and no involvement of a commissaire de justice (bailiff). This is the structural difference from the private creditor, who must first obtain an enforceable title and then have an attachment of debts served by a commissaire de justice on the basis of Articles L. 211-1 et seq. of the French Code of Civil Enforcement Procedures (code des procédures civiles d'exécution, CPCE). The preconditions and the conduct of this ordinary measure are described in our guide to the attachment of debts procedure.

This procedural asymmetry must not be confused with superiority of rank. Article L. 262-1 LPF expressly refers to the effects of the ordinary attachment of debts. The SATD is therefore not an exceptional procedure endowed with a preferential right of its own: it is an attachment of debts carried out without judicial intermediary, which produces exactly the same effects as a private attachment of debts. The whole resolution of competing claims follows from this characterisation.

Immediate transfer: the rule of the date, not of rank

The decisive provision is Article L. 211-2 CPCE:

The attachment instrument carries, up to the amount for which it is made, immediate transfer to the attaching creditor of the attached claim available in the hands of the third party, together with all its accessories. [...] The subsequent service of other attachments or of any other withholding measure, even by preferential creditors, as well as the occurrence of a judgment opening safeguard, judicial reorganisation or judicial liquidation proceedings, do not call this transfer into question.

Three operational consequences deserve to be singled out.

First, the transfer is instantaneous. From notification to the third party, the attached claim leaves the debtor's estate and enters that of the attaching creditor, up to the amount attached. The debtor is no longer the holder of it. There is therefore nothing left to attach for subsequent creditors, within the limit of the sum seized.

Second, the wording even by preferential creditors settles the question of the creditor's ranking. The Treasury's preferential right under Article 1920 of the French General Tax Code (code général des impôts, CGI) for direct taxes, or that under Article 1926 CGI for turnover taxes, is a right of preference. A right of preference is exercised only in a distribution procedure, that is to say where a single sum must be divided among several competing creditors: distribution of the sale price of a property, distribution by the liquidator, ranking procedure (procédure d'ordre). In a competition between successive attachments of debts, there is no pool to divide: the first attachment has exhausted the claim. The Treasury arriving second does not take priority; it arrives to an empty asset.

Finally, the rule works in both directions. A SATD served on Monday prevents an attachment of debts served on Tuesday by a bank holding a pledge over the account, just as an attachment of debts served on Monday by an unsecured supplier (créancier chirographaire) prevents a SATD served on Tuesday. Chronology takes precedence over the status of the creditor. This is the point that finance departments and litigation teams most often underestimate, reasoning by reflex in terms of a hierarchy of preferential rights.

Simultaneous attachments

The exception confirms the logic. Where several instruments are served or notified on the same day on the same third party, they are deemed simultaneous within the meaning of Article R. 211-15 CPCE. The creditors then compete and, if the available funds are insufficient, distribution is made pro rata, subject to legitimate grounds of preference. It is in this situation, and only in this one as regards competing creditors under an attachment of debts, that the Treasury's preferential right regains its practical effect: it constitutes precisely a legitimate ground of preference that displaces pro rata distribution (au marc l'euro).

The practical consequence is stark: between a notification made at 9 a.m. and a service made at 4 p.m. on the same day, the Treasury's preference applies; between the day before and the day after, it is ineffective. The bank's time-stamped statement becomes a decisive item in the file.

Claims performed in instalments and future claims

Article L. 211-1 paragraph 2 CPCE authorises the attachment of conditional claims, claims payable at a future date or claims performed in successive instalments, the rules specific to those obligations binding the attaching creditor. A SATD served on the tenant of a property owned by the taxpayer therefore captures the rent falling due, as it becomes payable, and not only the arrears. An institutional creditor arriving after the Treasury on the same rental flow will recover nothing until the tax debt has been paid, even if it holds a mortgage registered long ago on the property. The mortgage right of preference is exercised only on the sale price of the property, not on the income captured by an earlier attachment.

The position is the reverse for a bank account: the attachment captures only the balance available on the date of the instrument. Sums credited afterwards fall outside the measure. There is no continuing effect. A public accountant who wishes to capture recurring flows must repeat the SATDs, which is what happens in practice.

The exact effects on the debtor's bank balance

The measure freezes the whole of the credit balance on the date of the instrument, and not merely the amount claimed. Article L. 162-1 CPCE then provides for a regularisation period of fifteen working days during which the banker may reverse transactions in progress: cheques deposited for collection and not yet credited, card payments, bills of exchange. At the end of this period, the attached balance is definitively fixed and the portion exceeding the amount of the attachment becomes available again. The unattachable bank balance and the remedies open to the account holder are dealt with in our article on attachment of a bank account from the debtor's side.

Two points govern the debtor's cash position during this period.

• The freeze applies to all accounts opened with the same institution, which must declare the nature and balance of each one as part of its duty to provide information.
• Bank charges levied in respect of a SATD are capped at a percentage of the amount owed to the Treasury, subject to a ceiling set by decree, unlike the charges for an ordinary attachment of debts, which depend on the account agreement.

The banker, as garnishee, must immediately declare the extent of its obligations towards the debtor pursuant to Article L. 211-3 CPCE. An inaccurate or late declaration exposes it, on the basis of Article R. 211-5 CPCE, to being ordered to pay the sums due to the attaching creditor, save for an external cause. This sanction is not theoretical and provides the private creditor displaced by an earlier SATD with a residual line of attack where the bank's declaration reveals inconsistencies.

The actual payment over to the public accountant is not instantaneous. The Tax Procedure Code provides for a lag between the transfer, which takes effect on notification, and the physical payment of the funds, so as to leave time for challenge. This deferral has no effect on the competition between creditors: it does not reopen the possibility for a creditor appearing between the two dates to claim the sums. The transfer has already been completed.

Challenging a SATD: time limits, courts, fatal errors

This is where the SATD differs radically from the private attachment of debts, and where the timetable becomes a matter of being time-barred.

The mandatory prior administrative appeal

Challenges relating to recovery fall under Article L. 281 LPF, which requires a request to be addressed first to the authority on which the pursuing accountant depends. This prior appeal is mandatory: a direct summons before the judge without going through the head of department is inadmissible, and the inadmissibility cannot be cured once the time limit has expired.

Article R. 281-3-1 LPF sets a period of two months from notification of the enforcement instrument for submitting this request. The starting point is notification of the SATD to the taxpayer, which is made at the same time as the notification to the third-party holder, and not a later notice of attachment. This detail is crucial: in the ordinary attachment of debts, the instrument is served on the third party and then notified to the debtor within eight days on pain of lapse (Article R. 211-3 CPCE), and the debtor has one month from that notification to apply to the enforcement judge (juge de l'exécution) (Article R. 211-11 CPCE). The time limit for challenging a SATD follows a different logic: two months, but from the initial notification, and before the authority first, then the judge.

Allocation of jurisdiction between the enforcement judge and the tax judge

Article L. 281 LPF distinguishes two categories of challenge, and a wrong choice of forum is penalised by a finding of lack of jurisdiction.

• Challenges concerning the formal regularity of the instrument fall to the enforcement judge: missing mandatory particulars, absence of notification to the taxpayer, error as to the identity of the third-party holder, attachment of unattachable sums.
• Challenges concerning the existence of the obligation to pay, the amount of the debt taking account of payments made, or the due date of the sum claimed fall to the tax judge, that is to say the administrative court or the judicial court depending on the nature of the tax.

If the authority does not reply within two months, or after notification of its decision, Article R. 281-4 LPF opens a new period of two months to bring the dispute before the competent court. Silence therefore starts time running; it does not mean that enforcement has been abandoned.

Challenge, stay of payment and release

A challenge to recovery does not, of itself, suspend the effects of the attachment. A debtor who challenges the tax base must use the separate route of the stay of payment (sursis de paiement) under Article L. 277 LPF, accompanying the contentious claim with an express request and, above a threshold, with guarantees. A stay obtained prevents the accountant from pursuing enforcement, but leaves it free to take protective measures. A SATD served despite a stay validly obtained may be challenged as an irregular enforcement instrument.

Release (mainlevée), finally, is a matter for the accountant's decision, which may grant it in whole or in part, in particular within a staggered payment plan. For a finance department, negotiating a payment schedule with the recovery department often remains quicker and safer than litigation whose outcome will not arrive for several months, whereas cash is frozen immediately.

Interplay with the opening of collective insolvency proceedings

Article L. 211-2 paragraph 3 CPCE says so expressly: the occurrence of an opening judgment does not call into question the earlier transfer. A SATD or an attachment of debts notified before the opening judgment retains its full effect, even if the physical payment of the funds takes place afterwards. The attaching creditor does not have to return the sums, and its claim is extinguished to the corresponding extent.

After the opening judgment, Article L. 622-21 of the French Commercial Code stays individual proceedings and prohibits any new enforcement measure for prior claims. The public accountant can no longer serve a SATD for claims arising before the judgment: it must file a proof of claim in the liabilities. The prohibition on payments in Article L. 622-7 of the French Commercial Code completes the arrangement.

Two important reservations for the institutional creditor.

The first concerns the hardening period (période suspecte). A payment obtained by compulsory enforcement during the hardening period, for a debt that has fallen due, does not automatically escape an action for nullity. The courts accept that such payments may be subjected to the regime of discretionary nullity under Article L. 632-2 of the French Commercial Code, where the creditor knew of the debtor's state of insolvency (cessation des paiements). A creditor who attached after receiving a letter from its debtor referring to a conciliation request or a general default in payment is exposed to an action by the insolvency officeholder. The priority of the attachment in time does not remove this risk.

The second concerns the registration of the Treasury's preferential right. Article 1929 quater CGI requires the preferential right to be registered above a threshold and within a period set by regulation, on pain of the claim losing its preferential character in the collective proceedings. An institutional creditor disputing the distribution of the proceeds of realisation of an asset has every interest in checking, with the registry of the commercial court, whether the tax claims have been properly registered. Failing that, the Treasury ranks as an unsecured creditor in the distribution, which substantially changes the economics of the case. The hierarchy of distribution between preferential and unsecured creditors is set out in our article on the order and ranking of payment of creditors in judicial liquidation.

Finally, the opening of a conciliation does not suspend proceedings automatically, but Article L. 611-7 of the French Commercial Code allows a debtor who has been served with a formal notice or is being pursued to ask the president of the court to apply Article 1343-5 of the French Civil Code. The judge may then defer or stagger the payment and, as a consequence, neutralise the effects of a SATD in progress. A creditor who delays enforcing its title during an amicable negotiation phase therefore runs the risk of seeing its window of action close.

Decision chronology: what to do, and within what time

For the finance department of the debtor whose assets are attached, the milestones are as follows.

• On receipt of the notification: identify the exact date and time of receipt by the bank, list all the accounts frozen, assess the impact on payroll dates and upcoming SEPA direct debits, and alert lending institutions if cash covenants are likely to be affected.
• Within fifteen working days: monitor the reversals made by the bank and check that the portion of the balance exceeding the amount attached is released when the regularisation period expires.
• Within two months of notification: bring the prior appeal under Article R. 281-3-1 LPF if regularity or the due date is open to challenge, characterising the ground correctly so as to address the right court.
• In parallel: request a payment plan, and consider whether the state of cash requires an application to the president of the court for the opening of a conciliation or the appointment of an ad hoc agent (mandat ad hoc), before the accumulation of attachments establishes insolvency.

For the private creditor, the choice turns on speed and on the choice of garnishee.

• Check for the absence of any registration of the Treasury's preferential right at the registry, and the state of pledge registrations, before incurring costs: a recent registration signals that the bank account is probably already under tax pressure.
• Where possible, prefer a garnishee other than the bank: a tenant, a customer under a framework agreement, a parent company owing a current account balance. The Treasury attaches bank accounts and customers identified through VAT returns first; less visible claims offer a better actual recovery rate.
• Assess the risk of nullity in the hardening period: where failure is imminent, preference should go to creating an exclusive security interest in rem or to a negotiation, rather than to belated compulsory enforcement.
• Do not confuse the priority in time of the claim with the priority in time of the attachment. The date on which the claim arose is irrelevant in the competition between attachments: only the date of the instrument counts. It becomes decisive again, however, in collective proceedings, for the distinction between prior claims and subsequent claims eligible for the preferential treatment of Article L. 622-17 of the French Commercial Code.

Conclusion

The competition between the administrative attachment by a third-party holder and the private creditor's attachment of debts is not resolved by the hierarchy of preferential rights, but by the calendar. The immediate transfer effect of Article L. 211-2 CPCE turns the race to recovery into a question of days, sometimes of hours. The Treasury's preferential right regains its usefulness only in two limited situations: attachments deemed simultaneous and collective distribution proceedings, where it remains subject to completion of the registration required by Article 1929 quater CGI.

Two recommendations follow. For a finance department, receipt of a first SATD should trigger, on the same day, a twofold reflex: calculating the two-month period for the prior appeal, and assessing whether to open an amicable procedure before successive attachments freeze cash for good. For an institutional creditor, compulsory enforcement against a bank account is rarely the right lever against a debtor already under tax surveillance: it is better to secure in advance an exclusive right to payment, by pledge of receivables, assignment of receivables by way of security or security trust (fiducie-sûreté), which holds where an attachment arrives too late. Before any enforcement measure against a weakened debtor, have the state of preferential right and pledge registrations checked: that is the stage at which the real yield of the procedure is decided.

Frequently asked questions

Does the Treasury's SATD take priority over an attachment of debts served the day before by a private creditor? No. Article L. 211-2 of the French Code of Civil Enforcement Procedures immediately transfers the attached claim to the first attaching creditor and provides that the subsequent service of other measures, even by preferential creditors, does not call this transfer into question. The claim left the debtor's estate on the first attachment. The Treasury's preferential right under Article 1920 CGI does not allow that priority in time to be overturned: it is exercised only in distribution procedures.

What is the time limit for challenging a SATD and before whom? Article R. 281-3-1 of the Tax Procedure Code requires a request to be addressed to the authority on which the pursuing accountant depends within two months from notification of the instrument. This prior appeal is mandatory. After the express decision or two months of silence, Article R. 281-4 LPF opens a new period of two months to apply to the judge: the enforcement judge for formal regularity, the tax judge for the obligation to pay.

How long does the bank account remain frozen after a SATD? The credit balance is frozen in full from notification, then Article L. 162-1 CPCE opens a regularisation period of fifteen working days allowing the bank to reverse transactions in progress. When this period expires, the amount attached is definitively fixed and the surplus portion becomes available again. Sums credited after the instrument fall outside the attachment, which has no continuing effect on an account.

What happens if two attachments are notified on the same day on the same account? Article R. 211-15 CPCE deems them simultaneous. The creditors then compete and, if the funds are insufficient, distribution is pro rata, subject to legitimate grounds of preference. In this specific situation, the Treasury's preferential right constitutes such a ground of preference and displaces pro rata distribution (au marc l'euro). The time-stamping of the instruments by the garnishee becomes decisive.

Does a SATD notified before the opening judgment survive the collective proceedings? Yes. Article L. 211-2 CPCE expressly provides that the occurrence of a judgment opening safeguard, judicial reorganisation or judicial liquidation proceedings does not call into question a transfer already completed, even if the physical payment of the funds takes place afterwards. The reservation concerns the hardening period: a payment obtained by compulsory enforcement when the creditor knew of the insolvency may be annulled on the basis of Article L. 632-2 of the French Commercial Code.

Can the Treasury serve a SATD after the opening of judicial reorganisation? Not for its claims prior to the opening judgment: Article L. 622-21 of the French Commercial Code stays individual proceedings and prohibits enforcement measures, the accountant having to file a proof of claim in the liabilities. The position differs for claims properly arising after the opening judgment and eligible for the preferential treatment of Article L. 622-17 of the French Commercial Code, which escape the stay of proceedings on the conditions laid down by that provision.

Does a pledge of receivables protect against a later SATD? The ordinary pledge of receivables under Articles 2355 et seq. of the French Civil Code gives the pledgee an exclusive right to payment of the pledged claim, enforceable against third parties from the date of the instrument between the parties and against the debtor of the pledged claim from its notification. It is accepted that this exclusive right withstands a later attachment and remains effective in collective proceedings. It is one of the few techniques that neutralises the race to recovery described above.