Non-Payment Remedies in France: What an Unpaid Seller Can Do

Non-payment remedies in France: the seller's options at a glance

When a buyer in France fails to pay for goods, the seller is far from powerless. French law does not funnel every unpaid seller into a single action for the price; instead it offers a layered set of non-payment remedies that can be combined or sequenced. Some operate before delivery, some after; some are self-help, some require the court; and some are only as strong as the clauses the parties wrote into their contract. Choosing the right combination — quickly — is what separates a full recovery from a write-off.

The core remedies fall into four groups. First, the seller can withhold performance — refuse to deliver, or retain the goods, until the price is paid. Second, the seller can sue for the price, with interest, and in many cases obtain a fast-track order to pay. Third, the seller can try to recover the goods themselves, principally where the contract reserves ownership until payment. Fourth, the seller can rely on the unpaid seller's privilege and, where appropriate, seek termination of the sale. Each of these is examined below.

Which remedy is worth pursuing depends heavily on one fact: whether the buyer is merely late or actually insolvent. A solvent but slow-paying buyer is a debt-collection problem, best met with interest, penalties and an order to pay. An insolvent buyer is a ranking problem, where the seller competes with other creditors and where retention of title and the privilege become decisive. The table below maps the principal non-payment remedies to when they help most.

Withholding delivery: the exception d'inexécution under Article 1612

The simplest of the non-payment remedies is also the strongest while it lasts: do not hand over the goods. Under Article 1612 of the Civil Code, a seller is not bound to deliver the thing sold if the buyer does not pay the price, unless the seller has granted a term for payment. This is a form of the exception d'inexécution — the defence of non-performance — applied to sale: the seller may lawfully suspend its own obligation for as long as the buyer withholds performance of its correlative obligation to pay.

The right is conditional. The seller must be ready to make a complete delivery; it cannot refuse to hand over part while demanding payment for the whole in circumstances that would themselves breach the contract. Where the sale is for cash, the seller also enjoys a right of retention over the goods and their related documents — French courts have upheld the retention of a vehicle and its registration papers until the price was paid. Retention is a powerful lever precisely because the seller keeps the asset rather than chasing money.

There is an important exception that runs the seller's way. Even where a payment term was granted, the seller may refuse to deliver if, since the sale, the buyer has fallen into insolvency proceedings or is otherwise in imminent danger of the price being lost — unless the buyer provides security to pay at term. This protects a seller who agreed credit on the strength of a solvency that has since evaporated. Withholding delivery is therefore both a first-line self-help remedy and a bridge to the more drastic non-payment remedies that apply once ownership or possession has already passed.

Suing for the price and the fast-track order to pay

Where the goods have already been delivered, the seller's central non-payment remedy is the action for the price (action en paiement). The buyer's primary obligation is to pay the price at the time and place fixed by the contract; failing a stipulation, payment is due at the time and place of delivery. Once the debt is due and the buyer is in default, the seller can claim the price together with interest — which runs, among other cases, from the date the seller formally demands payment (mise en demeure).

For a debt that is certain and not seriously disputed, full litigation is rarely the efficient route. French procedure offers a fast-track order to pay — see the order to pay procedure (injonction de payer) — under which the creditor obtains an enforceable order on documents alone, without a hearing, unless the debtor objects. For cross-border trade debts within the EU, an equivalent European procedure exists. These tools turn an unpaid invoice into an enforceable title quickly and cheaply, which is often the whole battle where the buyer is solvent but stalling. Our guide to recovering an unpaid invoice in France walks through the practical steps.

Timing matters. Bringing the action does not waive other remedies — a seller who sues for the price does not thereby give up the right to seek termination of the sale later if payment still does not come. But commercial claims are subject to limitation, so a seller should not let an unpaid invoice age indefinitely. The practical sequence is usually: formal demand, then order to pay for undisputed sums, and only a full action where the buyer raises a real defence such as non-conformity.

Reclaiming the goods under a retention-of-title clause

The most valuable of all the non-payment remedies is the ability to take the goods back. Under the default rule ownership passes on agreement — before delivery and before payment — so a seller who has delivered has, in principle, parted with title and is left with a money claim. A retention-of-title clause (clause de réserve de propriété) reverses this: the seller keeps ownership until the price is paid in full, converting the seller from an ordinary creditor into an owner who can reclaim its property. See retention of title clauses for how to draft and register one.

The clause is only as good as its conditions. Ownership is reserved, so the goods travel at the seller's risk until the reservation is lifted by payment. The clause must be agreed no later than delivery, and the goods must remain identifiable — a claim to recover fails if the goods have been consumed, transformed beyond recognition or resold to a good-faith buyer who can invoke possession. Where the buyer has resold, the reservation may extend to the resale price still owed to the buyer, allowing the seller to reach the sub-sale proceeds.

Retention of title comes into its own precisely when it matters most — in the buyer's insolvency. Because the goods never became the buyer's property, they do not fall into the insolvency estate, and the seller can bring a claim to recover them (revendication) subject to strict deadlines and formalities. Without such a clause, the ordinary faculty for an unpaid seller to reclaim delivered goods from the buyer's hands has been removed from the Civil Code, which is why the clause, rather than the general law, is the practical route to recovery.

The seller's privilege and termination for non-payment

Where the seller has no retention-of-title clause and title has passed, French law still gives the unpaid seller a preferential ranking. Under Article 2332 of the Civil Code, the unpaid seller enjoys a privilege over the movable sold. This privilege entitles the seller to be paid ahead of the buyer's other creditors out of the value of the goods — including out of the resale price where the goods have been on-sold — although, importantly, it does not confer a right to follow the goods into a third party's hands (no droit de suite).

The privilege is a ranking tool, not a recovery tool. It improves the seller's position in a distribution of proceeds but does not, by itself, put the goods back in the seller's warehouse. That is the distinction from retention of title: the privilege gives priority over the price; the clause gives back the thing. In an insolvency, both may be relevant, but the reservation of ownership is generally the stronger position because it keeps the asset out of the estate altogether.

Alongside these securities sits termination of the sale for non-payment. Under Articles 1654 and 1655 of the Civil Code, the seller may seek to have the sale resolved where the buyer does not pay the price. Termination follows the general rules on judicial termination: it requires a sufficiently serious non-performance and, absent an express resolutory clause, is not automatic — the buyer may still pay during the proceedings, and the court retains a measure of discretion. A well-drafted resolutory clause tightens this by providing for termination as of right after a formal demand goes unanswered.

Stopping goods in transit and payment against documents

A seller's leverage is greatest while it still controls the goods, and shipment does not end that control at once. Where goods are in the hands of a carrier and the buyer's solvency deteriorates before the price is paid, the seller can often act on the carriage arrangements — for instance by not authorising release to a buyer who has not paid — to avoid handing valuable stock to a buyer who will not pay for it. This is the practical counterpart, in transit, to the right to withhold delivery under Article 1612.

Contractual mechanics do much of the work here. Selling cash on delivery means the carrier should not release the goods unless the price has been paid. Selling against a documentary credit ties release of the goods to the buyer's bank honouring the documents, so the seller is paid by the bank rather than exposed to the buyer's credit. In each case, the seller has structured the transaction so that possession and payment move together, closing the window in which the buyer could take delivery without paying.

These arrangements matter most for international sales into France, where the seller may never have met the buyer and cannot easily assess its solvency. Building the payment trigger into the delivery and carriage terms — rather than relying on suing after the event — is the most reliable of the non-payment remedies because it prevents the loss rather than repairing it. Where the goods have already been refused by the buyer at the port, that refusal can itself lead to termination of the sale.

Penalty clauses, interest and mandatory B2B late-payment rules

Money remedies are strengthened by the clauses the seller puts in its terms and by the statutory floor that French law imposes in business-to-business trade. A well-drafted penalty clause (clause pénale) fixes in advance the sum payable on default, sparing the seller the need to prove its loss — though a French court may reduce a penalty that is manifestly excessive, or increase one that is derisory. An interest clause similarly pre-agrees the rate running on the unpaid price from the due date.

On top of any contractual clause, Article L441-10 of the Commercial Code imposes a mandatory regime of late-payment consequences between businesses. Late-payment interest accrues automatically once the payment deadline passes, at a rate the statute sets by reference to the European Central Bank rate plus a margin, without the need for a reminder. A fixed lump-sum recovery indemnity is also due for each unpaid invoice, in addition to that interest, and the payment terms and penalties must be stated on the invoice and in the general terms of sale.

Used together, these mechanisms transform the economics of chasing an unpaid buyer. Contractual penalties and pre-agreed interest make default expensive; the statutory late-payment regime adds interest and an indemnity by operation of law; and the compulsory invoice mentions make the amounts hard for the buyer to contest. For a seller selling regularly into France, getting these clauses right is the cheapest of all the non-payment remedies to deploy.

When the buyer is insolvent — and a step-by-step response

Everything changes if the buyer enters insolvency proceedings (procédure collective). Individual enforcement actions are stayed, the seller cannot simply sue for the price or seize assets, and unpaid suppliers become one class of creditor among many. In this setting the difference between remedies is stark: an ordinary money claim must be declared and will rank behind privileged and secured creditors, whereas a valid retention-of-title clause lets the seller reclaim its own goods outside the estate — provided the strict revendication deadlines are met.

This is why the work done before default determines recovery after it. A seller with a written, buyer-accepted retention-of-title clause, identifiable goods and a diligent claim is in a materially stronger position than a seller relying only on the unpaid seller's privilege or a bare action for the price. Once insolvency is on the horizon, speed and formality are decisive: missing a declaration or revendication deadline can extinguish an otherwise good claim.

Frequently asked questions about non-payment remedies in France

What can a seller do if the buyer does not pay in France?

French law offers several non-payment remedies that can be combined: withholding delivery under Article 1612 of the Civil Code, suing for the price with interest (often via a fast-track order to pay), reclaiming the goods under a retention-of-title clause, and relying on the unpaid seller's privilege under Article 2332. Which to use depends on whether the buyer is merely late or actually insolvent.

Can I stop delivery for non-payment?

Yes. Under Article 1612 of the Civil Code, a seller is not obliged to deliver the goods if the buyer does not pay the price, unless a payment term was granted. Even where a term was granted, the seller may refuse delivery if the buyer has since become insolvent and is in danger of not paying, unless the buyer provides security.

Can I take the goods back if I have not been paid?

The reliable route is a retention-of-title clause, which keeps ownership with the seller until payment and allows the goods to be reclaimed — including in the buyer's insolvency — provided they remain identifiable. The old general faculty for an unpaid seller to reclaim delivered goods has been removed from the Civil Code, so recovery now depends on having reserved ownership by contract.

What is the unpaid seller's privilege?

Under Article 2332 of the Civil Code, the unpaid seller of a movable enjoys a privilege that ranks it ahead of the buyer's other creditors on the value of the goods sold, including on the resale price. It does not give a right to follow the goods into a third party's hands, so it improves ranking rather than allowing physical recovery.

What happens if the French buyer is insolvent?

Insolvency proceedings stay individual enforcement, so the seller cannot simply sue or seize. Ordinary claims must be declared and rank behind secured and privileged creditors, whereas goods held under a valid retention-of-title clause can be reclaimed outside the estate. Deadlines for declaring claims and reclaiming goods are short and strictly enforced.

Can I claim interest and penalties on a late-paying French buyer?

Yes. Article L441-10 of the Commercial Code imposes automatic late-payment interest and a fixed recovery indemnity in business-to-business sales, without any reminder being needed. A contractual penalty clause can also fix the sum payable on default, though a court may reduce a manifestly excessive penalty.

Should I sue for the price or terminate the sale?

Suing for the price keeps the contract alive and seeks payment plus interest, and is usually best against a solvent but slow buyer. Termination under Articles 1654 and 1655 of the Civil Code unwinds the sale for serious non-payment, with restitution, and suits a seller who would rather recover the goods or their value than wait for a doubtful payment. Bringing one action does not waive the other.

Key takeaways on non-payment remedies in France

How our French lawyers help with non-payment remedies

Petroff Avocats acts for both sellers and buyers in disputes over unpaid goods sold into and within France. For unpaid sellers, we assess which non-payment remedies fit the situation, send effective formal demands, obtain fast-track orders to pay, enforce retention-of-title clauses and the seller's privilege, and protect claims within the strict deadlines of French insolvency proceedings. For buyers facing a demand, we test whether the seller's clauses are enforceable, whether delivery or conformity defences apply, and whether a claimed penalty is excessive. We also review and rewrite general terms of sale so that retention of title, penalty and interest clauses, and the mandatory Article L441-10 mentions, actually work when payment stops.

This article is for general information only. It does not constitute legal advice and should not be relied upon in place of advice tailored to your circumstances. The remedies available to an unpaid seller depend on the contract, the goods, the parties' status and whether insolvency proceedings have opened. Contact our French lawyers for advice on your situation.