The sales proposal in Quebec
How to save a company in financial difficulty in Quebec: the proposal agreement explained
Par l’équipe BRESSE Syndics | Mis à jour : mai 2026 | Lecture : 7 min | Sauvever entreprise Québec, proposition concordataire, restructuration dettes commerciales, éviter faillite commerciale
Your business is still generating revenue, but payments are lagging. Suppliers are getting impatient. Revenu Québec and the CRA are pressing. You’ve been holding your small business together for months, and you’re wondering if there’s an alternative to commercial bankruptcy. The answer is yes: a proposal.
This legal solution, provided for under Section 50 of the Bankruptcy and Insolvency Act (BIA), is one of the most powerful tools available for restructuring a viable business in Quebec. Here’s what every manager should know before it’s too late.
What is a proposal and how does it work?
A proposal is a legal agreement between your company and its creditors, negotiated and filed by a licensed insolvency administrator (LIA). It allows you to reduce the total amount of your debts, spread payments over a realistic period – often up to 60 months – and continue your operations throughout the process.
Unlike commercial bankruptcy, which entails the liquidation of assets and the cessation of activities, a proposal has a single objective: to save your business.
Concordat Proposal and Commercial Bankruptcy
A Comparison of the Two Main Solutions for a Company in Financial Difficulty.
Leaves the company
Concordat Proposal: The company continues its operations.
Commercial Bankruptcy: The company ceases operations.
Assets
Concordat Proposal: The assets are retained by the company.
Commercial Bankruptcy: The assets are liquidated by the trustee.
Management Oversight
Concordat Proposal: The executive retains control of the company.
Commercial Bankruptcy: Control is transferred to the trustee.
Employees
Concordat Proposal: Jobs are preserved.
Business Bankruptcy: Employees Are Laid Off.
Creditors’ Vote
Concordat proposal: A majority of creditors by number and two-thirds by value must accept it.
Commercial Bankruptcy: Creditor Vote Not Required.
Repayment Period
Concordat Proposal: Up to 60 months, depending on the negotiated agreement.
Commercial Bankruptcy: Immediate Liquidation of Assets.
Suspension of Prosecution
Concordat Proposal: Effective immediately upon filing.
Commercial Bankruptcy: Effective immediately upon filing.
Which companies can file a proposal in Quebec?
The composition proposal is not reserved for large corporations. It is available to a wide range of profiles:
■ Incorporated SMEs (inc., ltée) with a viable business model but overleveraged.
■ Individuals, self-employed workers and sole proprietors whose debts exceed $250,000.
■ General partnerships, limited partnerships and joint stock companies.
■ Companies that are still generating income but can no longer meet their deadlines.
Central criterion: For a proposal to be successful, your personal or business situation once the offer has been accepted and implemented must be viable. If your creditors receive more with the proposal than they would in bankruptcy, they have a rational interest in accepting it.
The 6 major advantages of a proposal for an executive
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Immediate suspension of all collection procedures
As soon as the notice of intent or the proposal itself is filed, an automatic suspension of proceedings takes effect. Bank seizures, third-party seizures on accounts receivable, lawsuits, demands for payment from Revenu Québec and the CRA – everything stops the same day. Catch your breath.
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Continuity of operations and preservation of jobs
You retain control of your business throughout the entire process. Your employees keep their jobs. Your customers continue to be served. Your current contracts are protected. That’s the fundamental difference with commercial bankruptcy.
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Real reduction in debt burden
Depending on the situation, your creditors may accept a substantial reduction in the principal owed. The result: debt servicing aligned with the reality of your cash flow, not with commitments made in another economic context.
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Possibility of terminating disadvantageous leases or contracts
The composition proposal enables you to terminate certain commercial leases and to sell or terminate contracts that are weighing on your results. It is a major strategic lever during restructuring.
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Potential release of directors for GST/QST and SIR
A homologated proposal can relieve directors of their personal liability for source deductions and GST/QST not remitted to the government. This is one of the most powerful – and least known – benefits of this mechanism.
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Preserving reputation and relational capital
Unlike a commercial bankruptcy, which leaves a permanent mark on your file, a proposal is perceived by business partners as a responsible restructuring approach. Your goodwill, your customer and supplier relationships, your credibility as an entrepreneur – all are preserved.
How does a proposal work? The 5 stages
Step 1 – Confidential analysis with a licensed trustee
At BRESSE, the first meeting is free, confidential and without obligation. We analyze financial statements, cash flow, debt structure and business model viability.
Step 2 – Submission of a notice of intent (if urgent) or proposal
The notice of intent to file a proposal (article 50.4 BIA) can be filed as an emergency to obtain an immediate stay of proceedings and up to six months to prepare the formal proposal.
Stage 3 – Negotiation and proposal writing
You and your syndic prepare a realistic proposal, based on what the company can actually pay back. This is where experience counts: a poorly calibrated proposal will be rejected.
Step 4 – Creditors’ vote – Meeting
To be accepted, the proposal must be supported by a simple majority in number and two-thirds in value of claims at a meeting held on the subject (often by videoconference).
Step 5 – Court approval and enforcement
Once accepted by the creditors, the proposal must be homologated by the court. It then becomes binding on all creditors, including those who voted against it.
When should you consult a trustee to save your business in Quebec?
The earlier you consult, the more options you have. Managers who consult before the situation becomes critical have all the levers at their disposal: restructuring, private negotiations, composition proposals. Those who wait for foreclosure often find themselves forced into commercial bankruptcy.
Save your business – Consult a trustee in Quebec City for free
A boutique firm founded 40 years ago, BRESSE Syndics supports business leaders in the greater Quebec City area. Free, confidential, no-obligation initial meeting.
To book an appointment: bresse.com | 1 844 890-6767
BRESSE Syndics – Licensed Insolvency Trustees – Greater Quebec City Area – 40 years of experience working with business leaders
2026 BRESSE Syndics – bresse.com
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