Payment Terms in France and Late Payment Penalties (B2B)

A detailed guide for foreign creditors doing business with French companies

Late payment is one of the most common triggers for debt collection and commercial litigation in France. If you sell goods or services to a French company, French law does not treat payment terms as a “business courtesy”: it sets hard ceilings, imposes automatic late-payment penalties, and can expose the debtor (and sometimes the creditor’s documentation process) to administrative sanctions.

For foreign creditors, the practical challenge is rarely “what does the law say?”—it is how to use these rules to accelerate payment, build an enforcement-ready file, and move efficiently from negotiation to court action when necessary.

This article explains (i) the maximum payment terms permitted in France, (ii) the sector-specific regimes, (iii) how late-payment penalties and the €40 recovery fee work, (iv) the compliance risks and administrative fines, and (v) how these rules translate into actionable debt recovery steps.

1. The legal framework: French Commercial Code payment-term ceilings

1.1 Payment terms must be stated in the seller’s terms and cannot exceed the legal caps

In France, B2B payment deadlines are regulated primarily by article L.441-10, I of the French Commercial Code. The baseline rule is simple:

• The contractual payment deadline cannot exceed 60 days from the invoice issue date.

• Alternatively, the parties may agree on a maximum of 45 days end-of-month from the invoice date, but only if:

  1. it is expressly stipulated in the contract, and

  2. it is not a manifest abuse against the creditor.

This matters because many debtors try to argue “we pay at 75/90 days” based on internal practice. In France, internal policy is irrelevant if the contract is not compliant with the statutory ceilings.

1.2 If nothing was agreed, the default is 30 days from delivery or performance

If the contract or terms do not provide a valid payment deadline, the law imposes a default rule: payment is due within 30 days from:

• receipt of goods, or

• completion of the services.

For foreign creditors, this is a powerful point: a debtor may attempt to treat an invoice as “not yet due” because “we didn’t negotiate terms.” Under French law, that often backfires—the deadline becomes 30 days, not “whenever we decide.”

1.3 Periodic invoicing is capped at 45 days from the invoice date

For periodic invoicing (e.g., monthly billing), the payment deadline agreed between the parties cannot exceed 45 days from the invoice issue date.

2. The practical difference between “60 days” and “45 days end-of-month”

Foreign businesses often underestimate how different these two options can be in real cash-flow timing.

2.1 “60 days from invoice date”

If your invoice is dated 10 January, the maximum contractual due date is 11 March (depending on counting conventions, you typically treat it as 60 calendar days).

2.2 “45 days end-of-month”

If your invoice is dated 10 January, “end-of-month” means 31 January, and adding 45 days puts you around mid-March. This can be longer than 60 days depending on the invoice date within the month.

Because “45 days end-of-month” can sometimes create a longer payment window than 60 days, French law requires it to be expressly stipulated and not abusive.

Debt collection tip: when your debtor claims a “45 days end-of-month” deadline, verify whether it was clearly agreed in writing and whether their interpretation is correct (many accounting departments apply it incorrectly).

3. Special payment-term regimes: sectors where the maximum is shorter (or different)

French law imposes specific caps for certain industries. This is frequently relevant in cross-border commerce because the foreign supplier may not realize that the debtor’s sector is governed by stricter rules.

3.1 Transport-related services: 30 days

For many transport and freight-related services, the payment deadline is capped at 30 days (counted from invoice issue date in the statutory scheme).

Why it matters: Transport disputes often involve repeated invoices. A debtor delaying beyond 30 days is not just “slow”—they may be systematically non-compliant with a mandatory rule, which strengthens your leverage.

3.2 Agricultural and food products: perishable vs non-perishable

French law distinguishes perishable categories and imposes shorter deadlines in many cases. Chambers of commerce summaries and compliance notes highlight these regimes.

For foreign creditors, the key point is not memorizing every sub-category: it is knowing that in agri-food, 30 days caps appear frequently, and a debtor cannot contract out of them by “industry practice.”

3.3 Professional derogations in certain sectors

Some sectors benefit from negotiated derogations (e.g., certain seasonal industries), but those derogations are defined and limited; they are not a free-for-all.

4. A “cheat sheet” table of common payment-term ceilings (France B2B)

Below is a practical overview of the most commonly encountered ceilings:

This is a guide, not a substitute for reviewing your exact contract documents and the debtor’s activity.

5. Late payment in France: penalties are automatic and can be substantial

French B2B law treats late payment as more than a breach of etiquette. Once the due date is missed, two separate mechanisms typically become relevant:

1. Late-payment interest (pénalités de retard / intérêts moratoires)

2. A fixed €40 recovery fee per unpaid invoice

5.1 “Automatic” means: you do not need a prior reminder to create the right

Under the statutory logic, late-payment penalties are due automatically once the deadline has passed. In other words, they are not conditioned on a prior “warning.”

However: even if the penalties exist automatically, your enforcement strategy still benefits from a well-structured written notice (more on this below). “Automatic” is a legal concept; “recoverable in practice” depends on evidence, clarity, and pressure.

5.2 Which interest rate applies? There are two big ideas: minimum rate and statutory fallback

(A) The minimum floor: not less than 3× the legal interest rate

French rules impose a minimum: penalties cannot be below three times the legal interest rate.

For the second half of 2025, France set the legal interest rate at 2.76% for “all other cases” (i.e., professional/commercial), and 6.65% for certain consumer-type claims.

For typical B2B debt, the “professional” rate is the relevant reference point. A 3× floor based on 2.76% gives a minimum penalty rate around 8.28% per year.

(B) The statutory fallback: ECB refinancing rate + 10 points (if no valid rate is specified)

If your documents fail to specify an applicable penalty rate, French law provides a fallback mechanism widely described in compliance guidance: ECB refinancing rate + 10 percentage points.

Because ECB rates evolve, the precise number changes over time. The European Central Bank (ECB) publishes its key rates (including the main refinancing operations rate).

Practical drafting note: Many businesses choose to state a fixed annual rate (often significantly above the minimum) to avoid changing invoices/terms every time the legal rate shifts.

5.3 The €40 recovery fee (indemnité forfaitaire)

In addition to interest, French B2B rules provide a fixed €40 recovery-cost indemnity per unpaid invoice. This is intended as a standardized “collection cost” compensation.

In practice, this amount is small in major disputes, but it has two real utilities:

• It reinforces that late payment triggers multiple consequences, not just principal due.

• It can matter when there are dozens of invoices.

5.4 How penalties are calculated (workable method)

A simple and court-friendly approach is prorated annual interest:

Penalty interest = Invoice amount × annual rate × (days late / 365)

Key practical elements:

• Penalties typically start running the day after the due date.

• Penalties stop when funds are actually credited (banking delays can matter).

Debt collection tip: In negotiations, penalties are leverage. In court, they are money. In enforcement, they can drive the debtor to settle once the cost of waiting becomes visible.

6. Why payment-term law matters strategically in debt recovery

Foreign creditors sometimes treat “payment terms” as background paperwork. In France, payment-term rules often decide:

• when your claim becomes due (“exigible”)

• which procedure is fastest and most suitable

• how strong your pressure phase is

• whether you can justify urgent protective measures in certain circumstances

• the debtor’s exposure to compliance risk and reputational issues

In other words, payment-term law helps you shift from “please pay” to “you are in breach and the clock is costing you.”

7. Documentation: what should be in your contract, terms, and invoices

Your documents should clearly state:

• Payment deadline (e.g., 30 days, 45 days end-of-month, 60 days)

• Late-payment interest rate (contractual rate compliant with the minimum)

• €40 fixed recovery fee reference

• A clear invoice due date

Even where the law provides a fallback, clarity increases recoverability and reduces the debtor’s room for arguments.

8. Administrative sanctions: fines and injunctions for non-compliance

French authorities can enforce compliance with payment-term rules. The point for a creditor is not to “threaten regulators” casually, but to understand that large companies in France often care deeply about:

• being publicly sanctioned,

• being listed in administrative publications,

• reputational impact (especially for groups, regulated sectors, or public-procurement-facing entities).

Chambers of commerce and compliance summaries emphasize that payment terms are a regulated compliance topic.

Used correctly, compliance risk is not a “threat”—it is a legitimate part of the negotiation environment.

9. Public sector payment deadlines in France (public procurement)

Public bodies and public procurement contracts (markets/concessions) have their own payment-term rules and statutory late-payment interest mechanisms. If your debtor is:

• a public authority,

• a public entity, or

• operating under public procurement rules,

your strategy should reflect that framework and its evidence requirements. The “30-day culture” is stronger in public procurement than in private B2B.

10. EU developments: the push toward stricter late-payment rules

The European Commission published a proposal for a regulation to combat late payment in commercial transactions in September 2023.

The proposal has been widely discussed by practitioners and would, if adopted in final form, tighten and harmonize certain rules across the EU.

For foreign creditors, the takeaway is practical:

• Today, France already has strict ceilings (60 days / 45 EOM / sector caps).

• EU-level change may further restrict payment terms and increase enforcement pressure over time.

If you operate across multiple EU markets, monitoring the evolution is worthwhile.

11. Turning the rules into action: a practical debt recovery roadmap in France

Knowing the legal rules is not the end goal. The end goal is money collected. Below is a field-tested roadmap that aligns with French practice and preserves a strong litigation file.

Step 1 — Diagnose the due date correctly

Before sending any escalation letter, confirm:

• invoice date

• delivery/performance date (if needed for 30-day default rule)

• contractual payment term clause (if any)

• whether a sector-specific rule might shorten the deadline

This determines whether your claim is already due and whether you can credibly state “you are in breach as of [date].”

Step 2 — Quantify principal + penalties + €40 (and present it clearly)

Debt recovery works better when the debtor sees a precise number:

• principal due

• penalty interest to date

• €40 recovery fee per invoice

• running daily interest rate (so the debtor feels the “meter”)

Even if you later negotiate, quantification anchors the negotiation.

Step 3 — Send a structured formal notice (mise en demeure)

A high-quality formal notice for a foreign creditor should:

• identify the contract and invoices

• state the due dates and legal basis (payment-term cap if relevant)

• claim principal + penalties + €40

• set a short deadline (often 8–15 days depending on context)

• indicate next steps (court action in France, and enforcement path)

The letter is not just a demand—it is evidence.

Step 4 — Decide whether the matter is “contestable” or “non-contestable”

This is the strategic fork.

• If the debtor has no credible dispute and the debt is well documented, France offers relatively efficient court routes.

• If the debtor raises technical disputes (defects, partial performance, set-off claims), your strategy must anticipate the evidentiary burden and likely timeline.

The goal is to avoid the two classic mistakes:

1. “Going full litigation” too early in a file that could have been resolved with proper pressure and evidence;

2. “Negotiating forever” while the debtor reorganizes assets and becomes enforcement-proof.

Step 5 — Consider protective measures where the risk is dissipation of assets

In certain cases, French procedure allows pre-judgment protective measures to preserve recovery potential. These are not automatic and depend on legal conditions and evidence, but when available, they can transform the case dynamic.

For foreign creditors, the practical logic is:

• if the debtor shows signs of financial distress or bad faith, speed and preservation can matter more than negotiation comfort.

Step 6 — Court proceedings in France (when required)

If payment does not arrive after formal notice:

• initiate the appropriate claim pathway in France

• frame the request clearly: principal + penalties + recovery costs

• prepare enforcement in parallel (because a judgment is only half the battle)

Step 7 — Enforcement after judgment (bailiff-led seizures)

Once you have an enforceable title, enforcement tools in France can include:

• bank account seizure,

• seizure of receivables,

• seizure of assets,

• enforcement against identified counterparties (depending on structure).

The earlier your file is organized, the more efficiently enforcement can begin once the judgment is obtained.

12. Drafting and compliance recommendations for foreign sellers (to prevent repeat problems)

If you sell repeatedly to French buyers, small improvements to your terms can materially reduce late payment:

1. Choose a clear due date and write it in the contract and invoices.

2. State a penalty interest rate that is compliant with French minimums and commercially meaningful.

3. Reference the €40 recovery fee.

4. Require an identified billing contact at the debtor company.

5. Consider contractual language on evidence (acceptance of delivery notes, sign-off rules).

6. Keep an internal “France file” checklist for each account: contract, PO, delivery proof, invoice, reminders.

These steps reduce the debtor’s ability to create “procedural fog.”

13. Frequently asked questions by foreign creditors

“If the debtor disputes the invoice, can we still claim penalties?”

Often yes, but strategy depends on whether the dispute is serious and documented. A superficial dispute does not automatically cancel penalties; however, it may affect procedural choices (summary vs full claim).

“Can we apply our own country’s late fee clause to a French debtor?”

It depends on governing law, jurisdiction, and whether the clause is enforceable under the applicable framework. Even where foreign law applies, enforcement in France often requires aligning your approach with French procedural reality.

“Do we need to send a reminder before penalties accrue?”

Legally, penalties are designed to be automatic once due date passes. Practically, a well-structured notice is strongly recommended for evidence and pressure.

“Is 90 days ever allowed in France?”

There are limited derogations in specific contexts (not a general rule). Treat “90 days” as a red flag unless clearly justified and compliant.