B2B Payment Terms and Late Payment Penalties in France

France's statutory B2B payment terms: 30 days by default, 60 days maximum

Unlike many common-law systems, France regulates the length of B2B payment terms by statute. The rule sits in Article L441-10 of the Commercial Code and it overrides whatever the parties might have preferred to agree. Foreign suppliers and buyers often assume that payment timing is a matter of pure freedom of contract; between businesses trading in France it is not. Getting the terms wrong is not a mere drafting slip, because it exposes the party who imposed them to administrative fines and makes any late payment penalties easier for the creditor to enforce.

The default position, where the contract is silent, is that the price falls due on the thirtieth day following receipt of the goods or completion of the service. This mirrors the general civil-law principle that the price of a sale is payable at the agreed time and, absent agreement, on delivery. Where the seller has granted no credit term, the buyer must pay promptly, and the invoice due date fixes both the moment of enforceability and the starting point of the limitation period for a payment action.

Parties may agree a longer term, but only within a statutory ceiling. The agreed period may not exceed 60 days from the date the invoice is issued. As an alternative that must be expressly stipulated in the contract, the parties may choose a term of 45 days end of month — meaning 45 days counted from the invoice date, then rounded to the end of the relevant month. Either cap can be used, but a business cannot combine them or drift beyond them. Periodic or consolidated invoices (factures périodiques) are subject to their own 45-day limit from the invoice date.

It is worth stressing that these limits are a ceiling, not a target. Nothing prevents a supplier from insisting on immediate payment or a shorter term; the caps only stop the parties from stretching credit too far. The 60-day figure is measured from the issue of the invoice, which is why prompt, correct invoicing matters — a delayed or defective invoice can push the effective due date out and blur the moment from which late payment penalties start to run. In practice, the invoice date, the due date and the delivery date should all be documented so that the deadline can be calculated without argument.

Mandatory late payment penalties: the interest rate and its minimum

When a B2B invoice is not paid by its due date, French law makes late payment penalties payable automatically. Under Article L441-10 of the Commercial Code, the penalties run from the day after the payment date shown on the invoice, and — critically for a creditor — they are due without any reminder or formal notice. The creditor does not have to send a mise en demeure or prove loss; the penalties accrue by operation of law from the first day of delay.

The rate is set primarily by the contract, subject to a floor. If the parties fix a rate, it cannot be lower than three times the French legal interest rate (taux d'intérêt légal). If the contract is silent, the statutory default rate applies: the interest rate applied by the European Central Bank to its most recent refinancing operation, increased by ten percentage points. Because the ECB refinancing rate moves, the applicable figure is the one in force at the start of the relevant half-year, and it should be recalculated as rates change.

These penalties are distinct from ordinary contractual interest or a negotiated penalty clause. They are a statutory floor designed to make late payment costly and to discourage buyers from using suppliers as a source of free credit. A supplier can, of course, also pursue the underlying debt itself and claim damages for any additional harm, but the late payment penalties are the baseline entitlement that arises the moment the deadline passes.

One further point matters for cross-border creditors: the penalties accrue in addition to, and independently of, the price itself. The claim for the price is subject to the general five-year commercial limitation period, which runs from the date the invoice becomes enforceable. A supplier who wants to preserve both the principal and the accumulated late payment penalties should therefore keep a clear record of each invoice's due date and of the interest accruing, and should not let the debt sit unclaimed until the limitation period is at risk.

The fixed 40-euro recovery indemnity on every late invoice

On top of the interest, Article L441-10 II of the Commercial Code entitles the creditor to a fixed indemnity for recovery costs. The amount is set by Article D441-5 of the Commercial Code at 40 euros. It is owed for each invoice paid late, not once per relationship, so a buyer who pays ten invoices late owes ten separate indemnities in principle, again without the need for a reminder.

The 40-euro sum is a lump-sum floor, not a cap. Where the actual costs of recovering the debt exceed 40 euros — for example lawyers' fees, a debt-collection agency or court costs — the creditor may claim additional compensation on production of supporting evidence. The fixed indemnity covers the routine administrative burden of chasing a late payer; the top-up covers documented, out-of-the-ordinary costs.

For a foreign supplier this is a useful, low-friction lever. It converts each late payment into a small but certain extra cost for the buyer and signals that the supplier knows and applies the French late payment rules. Like the interest, the indemnity must be mentioned in the supplier's terms and on the invoice, which brings us to the compulsory disclosure rules.

Compulsory mentions of the late payment terms on invoices and terms of sale

The late payment regime is backed by disclosure obligations. The supplier's general terms of sale and each invoice must state the payment due date, the rate of late payment penalties applicable, and the existence of the 40-euro fixed recovery indemnity. These mentions are not optional boilerplate; they are how French law makes the penalty regime visible and enforceable, and their absence is itself a breach that the enforcement authority can sanction.

General terms of sale (conditions générales de vente) occupy a central place in French B2B practice. They are the basis of the commercial relationship and, on request from a professional buyer, a supplier of goods must communicate them. Setting out the payment term, the penalty rate and the recovery indemnity in those terms — and repeating them on invoices — is the practical way to comply and to preserve the automatic nature of the penalties.

Administrative fines for exceeding the payment-term limits

The teeth of the system are administrative, not merely contractual. Under Article L441-16 of the Commercial Code, breaching the statutory payment terms — imposing an unlawful deadline, failing to apply the mandatory penalties, or omitting the compulsory mentions — exposes the offender to an administrative fine. The fine can reach 75,000 euros for a natural person and up to 2 million euros for a company, and it can be doubled where the same breach is repeated within two years.

Enforcement is handled by the French administration responsible for competition, consumer affairs and fraud control (the DGCCRF), which audits payment practices and can publish the identity of sanctioned businesses. This name-and-shame element means the reputational cost of unlawful payment terms can outweigh the fine itself, particularly for a group that trades widely in France.

The exposure falls on the party who imposes the non-compliant term, which in a supply chain is often the buyer squeezing its suppliers. A foreign company buying from French suppliers should treat the payment-term caps as a compliance obligation, not a negotiating variable. A foreign company selling into France should build the caps and the penalty mentions into its standard terms so that it neither breaches the rules nor loses the protection they offer.

Special sector regimes and derogations from the standard limits

The 30/60-day framework is the general rule, but it is not the only one. Article L441-11 of the Commercial Code and related texts provide for sector-specific payment terms, some shorter and some allowing limited, supervised derogations. Certain trades are subject to a stricter maximum than 60 days, while a few sectors benefit from negotiated inter-professional derogations reflecting the way their supply chains work.

Shorter mandatory terms apply, for example, to certain perishable foodstuffs, to alcoholic beverages subject to specific excise rules, and to some transport and freight services, where the law fixes a maximum well below the general ceiling. In a handful of seasonal sectors, professional agreements approved by decree permit longer terms on defined conditions. The detail is technical and changes, so the safe course is to check whether your specific goods fall under a special regime before relying on the standard 60-day cap.

How to draft compliant B2B payment terms and avoid late payment exposure

Compliance is not difficult once the rules are known, and it protects both sides: the supplier keeps its automatic penalties, and the buyer avoids fines. The aim is to state a lawful payment term, disclose the penalty regime, and put in place the operational steps to apply it. The following sequence works for a supplier setting up French-compliant terms of sale.

For buyers, the discipline is the reverse: resist any temptation to dictate 90- or 120-day terms to suppliers, review your standard purchase conditions against the caps, and treat the payment-term limits as a fixed compliance boundary. If you inherit non-compliant terms from a group template drafted for another jurisdiction, adapt them before using them in France.

The statutory late payment limits and penalties at a glance

The table below summarises the principal statutory limits and penalties governing B2B payment terms in France. It is a quick reference; the precise figures for the interest rate move with the ECB refinancing rate and with the legal interest rate, and sector regimes may vary the deadlines.

Frequently asked questions about B2B payment terms and late payment in France

What is the maximum payment term in France?

For B2B sales, the agreed payment term may not exceed 60 days from the invoice date, or 45 days end of month if that option is expressly stipulated. If the contract is silent, the price falls due 30 days after receipt of the goods or performance of the service under Article L441-10 of the Commercial Code.

What late payment penalties apply in France?

Late payment penalties are due automatically from the day after the invoice due date, without any reminder. The rate is whatever the contract fixes — at least three times the legal interest rate — or, by default, the ECB refinancing rate plus ten percentage points.

What is the 40-euro indemnity?

It is a fixed recovery indemnity set by Article D441-5 of the Commercial Code and owed for each invoice paid late, in addition to the interest. Where actual recovery costs exceed 40 euros, the creditor can claim further compensation on production of supporting evidence.

What must the invoice and terms of sale say?

The general terms of sale and each invoice must state the payment due date, the rate of late payment penalties and the existence of the 40-euro fixed recovery indemnity. These mentions keep the penalties automatic and are themselves a compliance requirement.

What is the fine for illegal payment terms?

Under Article L441-16 of the Commercial Code, breaching the payment-term rules can trigger an administrative fine of up to 75,000 euros for an individual and up to 2 million euros for a company, doubled on repeat within two years. The DGCCRF enforces the rules and can publish the name of the offender.

Do the late payment rules apply to a foreign supplier or buyer?

They apply as part of French commercial law and bite where French law governs the contract or the trade is performed in France. A choice-of-law clause pointing abroad does not automatically defeat them, so cross-border parties should confirm their position before relying on foreign terms.

Are there sectors with different payment deadlines?

Yes. Article L441-11 of the Commercial Code and related texts set shorter mandatory terms for certain trades — such as some perishable foodstuffs, alcoholic beverages and transport services — and allow limited, approved derogations in a few seasonal sectors. Check whether your goods fall under a special regime before relying on the 60-day cap.

Key takeaways on B2B payment terms and late payment in France

How our French lawyers help with B2B payment terms and late payment

Petroff Avocats advises businesses on both sides of the late payment rules. For suppliers, we draft French-compliant general terms of sale and invoicing wording that keep late payment penalties automatic and enforceable, and we act to recover unpaid invoices with interest and the statutory indemnity. For buyers, we audit purchase conditions and group templates against the Article L441-10 caps to remove the risk of administrative fines under Article L441-16, and we check whether a sector regime under Article L441-11 changes the applicable deadline. Whether you sell into France or buy from French suppliers, we help you set terms that are lawful, commercially workable and defensible if the DGCCRF ever asks.

This article is for general information only. It does not constitute legal advice and does not create a lawyer-client relationship. French late-payment rates and sector regimes change over time, and their application depends on the facts of each contract. Contact our French lawyers for advice on your situation.