Paris department store BHV Marais files for protection from bankruptcy

A procedure for a 'restart'

The Paris department store BHV Marais announced on Tuesday that it had filed for protection from bankruptcy in order to preserve the business and jobs. The company stressed that the procedure 'is part of BHV's restart, not its failure': the landmark store opposite Paris City Hall, which employs 700 people, will remain open. AFP reported the news.

The Shein dispute and a change of ownership

The department store's troubles began under its previous owner: the brand boutiques located in the store complained about delayed payments. Then last year the owner announced that BHV Marais would open the first permanent physical store of the Asian fast-fashion giant Shein. The decision provoked a sharp reaction from the French public, concerned about the disappearance of local jobs amid the flow of Asian imports, and triggered the departure of a number of brands. In June, the owner sold the business to several of his managers, who immediately severed ties with Shein.

A dispute over money for the building

The new owners said that under the June deal they were transferred ownership of part of the building, but the funds due to them have still not been paid, which, according to them, has negatively affected plans to revitalize the business. The building's owner — the Canadian asset manager Brookfield — rejected this claim, stating that it owes BHV Marais no outstanding amounts. In addition, according to AFP, French labor inspectors believe the department store is not making payments, though the company's management denies this. Thus, the key disagreements — over payments for the building and over outstanding debts — remain a matter of mutual denials between the parties.