Payment terms and late payment penalties in France

Foreign companies trading with French businesses need the rules on payment terms in France. The French Commercial Code (Code de commerce) generally caps agreed terms at 60 days from the invoice date, with exceptions. A late payer owes late payment penalties (pénalités de retard), due without reminder, and a €40 fixed recovery indemnity (indemnité forfaitaire pour frais de recouvrement).

Article L. 441-10 sets a 30-day default term and caps agreed terms at 60 days from invoice, or 45 days end of month if expressly stipulated and not manifestly abusive

Under Article L. 441-10 of the French Commercial Code, the time for payment cannot exceed 30 days after receipt of the goods or performance of the service, unless the terms of sale or the parties provide otherwise, and a term agreed between the parties generally cannot exceed 60 days after the invoice is issued.

The two limits do not run from the same date. The 30-day default term starts when the goods are received or the requested service is performed. It applies only where neither the terms of sale nor an agreement between the parties says otherwise. An agreed term counts from the invoice instead: it “may not exceed sixty days after the date of issue of the invoice” (our translation). The general cap on agreed terms is therefore 60 days from the invoice date, subject to the 45-day end-of-month alternative below and to the sector rules of Article L. 441-11.

By way of derogation, the same article lets the parties agree a maximum term of 45 days end of month after the invoice date. Two conditions apply: the term must be expressly stipulated in the contract, and it must not constitute a manifest abuse against the creditor.

Some contracts provide for an acceptance or verification procedure, which certifies that the goods or services conform to the contract. Article L. 441-10 III limits that procedure to 30 days from receipt of the goods or performance of the services. The contract may expressly stipulate otherwise, provided the stipulation is not an abusive clause or practice. The 30-day limit also gives way to specific provisions more favourable to the creditor.

Terms of sale are therefore negotiated within the general 60-day cap or its 45-day end-of-month alternative, unless a sector rule applies. See also our guide to French commercial law.

Article L. 441-11 imposes shorter maximum terms on road haulage and perishable food

Article L. 441-11 of the French Commercial Code sets its own maximum payment terms for certain sectors: 30 days from the invoice date for road haulage and related transport services, and 30 days from the delivery date for perishable agricultural and food products.

These limits govern payment “by any producer, reseller or service provider” (our translation). For transport, paragraph II, 5° covers:

• road haulage of goods;
• vehicle hire, with or without a driver;
• transport commission;
• activities of freight forwarders, shipping agents, air freight, freight brokers and customs brokers.

For food, paragraph II, 1° a) runs the 30 days from delivery, not from the invoice. The limit covers perishable agricultural and food products, frozen or deep-frozen meat, deep-frozen fish, and ready meals and preserves made from perishable food products.

The article sets further limits for livestock and fresh meat, alcoholic beverages, non-perishable agricultural and food products, agricultural equipment, seasonal sporting goods, leather, watchmaking and jewellery, and toys. These limits are not all shorter. For the last five, the maximum term must be expressly stipulated by contract without manifest abuse towards the creditor. Without an express stipulation, the general 60-day cap of Article L. 441-10 applies.

The invoice must state the due date, the penalty rate and the recovery indemnity

Article L. 441-9 of the French Commercial Code requires an invoice for each purchase of goods and each supply of services made for a business activity, and that invoice must state the payment date, the early-payment discount terms, the late payment penalty rate and the amount of the fixed recovery indemnity.

The seller must issue the invoice on delivery or completion of the service, and the buyer must ask for it. As regards payment, the invoice must state:

• the date on which payment must be made;
• the discount terms for payment before the date set by the general terms of sale;
• the rate of the penalties due on the day after the payment date shown on the invoice;
• the amount of the fixed recovery indemnity (€40);
• the purchase order number, where the buyer drew one up beforehand.

Payment counts as made “on the date on which the funds are made available, by the client, to the beneficiary or to its subrogee” (our translation), not on the day the transfer is ordered.

Invoicing failures carry their own administrative fine: up to €75,000 for a natural person and €375,000 for a legal person, rising to €150,000 and €750,000 for a repeat breach within two years. That fine is distinct from the Article L. 441-16 fine for breaching payment terms.

Late payment penalties are due without reminder, at a rate no lower than three times the legal interest rate

Article L. 441-10, II of the French Commercial Code makes late payment penalties payable the day after the payment date on the invoice, without reminder, at the European Central Bank’s most recent refinancing rate plus 10 percentage points unless otherwise provided, and no agreed rate may fall below three times the legal interest rate (taux d’intérêt légal).

The payment terms (conditions de règlement) must specify how these penalties apply and at what rate. Absent a contrary provision, the rate is “equal to the interest rate applied by the European Central Bank to its most recent refinancing operation, increased by 10 percentage points” (our translation). The rate in force on 1 January governs the first half-year, and the rate in force on 1 July the second.

The parties may agree on another rate, but a contrary provision “may not, however, set a rate lower than three times the legal interest rate” (our translation).

The penalties “are payable without a reminder being necessary” (our translation), so this text requires no prior formal notice. The cost of the delay therefore runs from the day after the due date.

The Cour de cassation considered whether a court may reduce such penalties in an unpublished decision of 18 May 2022 (No. 20-18.773). A contract set penalties at the minimum provided by former Article L. 441-6, now Article L. 441-10. Ruling in summary proceedings (référé), the judge had refused an interim payment, because the trial court could reduce or even cancel sums due under a penalty clause (clause pénale). The Court censured that reasoning: penalties equal to the statutory minimum “did not constitute a penalty clause open to moderation” (our translation).

The ruling concerned a rate equal to the floor, not a higher one. A clause that simply reproduces the statutory minimum was not treated as a reducible penalty clause in that case, a point to weigh when you have your terms of sale and payment clauses drafted under French law.

A business that pays late owes a fixed recovery indemnity of €40

Under Article L. 441-10 of the French Commercial Code, a professional that is late in paying owes the creditor, by operation of law, a fixed recovery indemnity, set at €40 by Article D. 441-5, and the creditor may request additional compensation, on proof, where its recovery costs exceed that amount.

Article D. 441-5 provides that the indemnity “is set at 40 euros” (our translation). The debt arises from the late payment itself: Article L. 441-10 makes the professional in default its debtor de plein droit.

Collection can cost more than €40. Where the recovery costs incurred exceed the fixed recovery indemnity, the creditor may request additional compensation, but only on proof of those costs.

One exception applies. The creditor may not invoke the benefit of “these indemnities” (our translation) where the opening of collective insolvency proceedings (safeguard, reorganisation or judicial liquidation) prohibits payment of its claim on the due date.

See also our guide on enforcement in France.

Late payment penalties cannot be added to statutory interest for the same delay in payment of the same debt, the Cour de cassation held in 2024

Late payment penalties under Article L. 441-10, II of the French Commercial Code cannot be claimed on top of statutory interest for the same delay on the same debt: in Cass. com., 24 April 2024, No. 22-24.275, published in the Bulletin, the Cour de cassation held that both are default interest of the same nature.

A company claimed, on unpaid invoices, both contractual penalties under Article L. 441-10, II and the statutory interest of Article 1231-6 of the French Civil Code. In summary proceedings, the court of appeal found that cumulating them raised a serious dispute (contestation sérieuse), which limits the summary judge’s powers. The Cour de cassation dismissed the appeal.

According to the Court, the penalty “constitutes default interest and […], being of the same nature, it is not cumulated with statutory interest for late payment” under Articles 1153 and 1231-6 of the Civil Code (our translation). The Court approved the court of appeal’s finding that, although their regimes differ, both “serve to compensate the loss arising from the delay in payment by the debtor” (our translation).

The Court also cited Articles 2 and 3 of Directive 2011/7/EU and declined to refer a question to the Court of Justice of the European Union, finding no reasonable doubt.

For the same delay in payment of the same debt, a creditor may therefore claim the penalties or the statutory interest, not both. Formally, the ruling approves a finding made in summary proceedings, without deciding the merits.

Breaching payment terms exposes a company to an administrative fine of up to €2 million and to publication

Under Article L. 441-16 of the French Commercial Code, a business that fails to respect statutory payment terms is liable to an administrative fine of up to €75,000 for a natural person and €2 million for a legal person, doubled for a repeat breach, and the decision imposing it is published.

The fine covers four breaches:

• failing to respect the payment terms of Articles L. 441-10 I, L. 441-11 II, L. 441-12 or L. 441-13;
• failing to state in the terms of payment the particulars required by Article L. 441-10 II;
• setting a penalty rate, or conditions for the penalties to fall due, that do not comply with Article L. 441-10 II;
• failing to respect the agreed method of calculating payment terms under the second, third and fourth paragraphs of Article L. 441-10 I.

A clause or practice that abusively delays the starting point of payment terms carries the same penalties. The ceiling rises to €150,000 for a natural person and €4 million for a legal person if the breach is repeated within two years of the first penalty decision becoming final.

The French competition and consumer authority (DGCCRF) imposes the fine under Article L. 470-2, after written notice and sixty days for observations. Its action is time-barred three years after the breach.

Under the general publication regime of Article L. 470-2, a sanction decision “may be published” (our translation). A decision under Article L. 441-16 “is published” (our translation), on the DGCCRF’s website and, at the sanctioned person’s expense, in a legal notices publication of its choice in its home département. The sanctioned person is informed beforehand of the nature and terms of the publication. If it does not publish, the DGCCRF may give formal notice under a daily penalty of €150, from notification of the formal notice until effective publication.

Article L. 442-1 makes discriminatory payment terms a ground for liability

Article L. 442-1 of the French Commercial Code, in the version in force since 20 August 2026 (Law No. 2026-796 of 18 August 2026), makes liable a business that applies to its partner, or obtains from it, discriminatory payment terms not justified by real consideration, thereby creating a competitive disadvantage or advantage for that partner.

The rule covers the negotiation, conclusion or performance of a contract by any person carrying on production, distribution or service activities. A difference in payment terms falls within it only if no real consideration, provided for in the agreement referred to in Article L. 441-4, justifies it.

The sanction is civil: the author incurs liability and must compensate the harm caused. Unlike the administrative fine for breaching the statutory caps, this ground targets unequal treatment between partners, not the length of the term.

The same article also covers subjecting, or attempting to subject, the other party to obligations that create a significant imbalance in the rights and obligations of the parties, covered in the article on how French law sanctions a significant imbalance between businesses.