Statutes of Limitations and Debt collection in France

The short answer is yes. As a foreign creditor you will want to pay close attention to these delays. Ignoring them will cause you further anguish and profit only your defaulting debtor.

The delays for statute of limitations for collecting an unpaid invoice vary according to the nature ofyour debts.
The statute of limitations defines the time period beyond which no legal action, civil or criminal,can be considered. When it comes to invoice management and debt collection proceedings, acreditor must respect a strict time line. Beyond these expiry dates, taking traditional legal action becomes relatively difficult.

The first form involves business to business debts. The delays in commercial contracts cover a time frame of 2 years depending on the relationship between creditors and debtors.

The second form touches on civil debts, with collection proceedings involving private individuals and commercial entities. Under such circumstances the statutes of limitation for recovering debts under French law is of 5 years.

Again, the short answer is no. There is no time limit applicable to all situations, the statutes of limitation vary according to the nature of your relationship with your debtor.
In the case of a professional/consumer relationship, the creditor has a period of 2 years to request the recovery of his unpaid invoice from the courts (article L218-2 of the French Consumer Code).

When it concerns a relationship between two professionals (commercial entity, consumers etc.), the statute of limitation is extended to 5 years (article L110-4 of the French Commercial Code).

In both cases, the date from which the limitation period is counted (2 or 5 years) is the due date indicated on the invoice, i.e. the maximum payment period that the seller displays on the invoice or on the sales contract (generally 30 days after the date of issue of the invoice, if the authorized payment period is set at 60 days for example, the limitation period is counted from this date). The following table summarizes some limitation periods according to the nature of the claim:

When it comes down to dealing with debt collection between two professionals, the creditor retains the right to pursue legal action past the stated delays (5 years) under the very specific circumstances that the debtor fails to raise it to the judge’s attention (art. 2247 of the French Civil Code).

However, in the case of debt collection proceedings between commercial entities and consumers, requests exceeding the statute of limitation are automatically rejected by the courts. In cases involving consumers, legal action is pointless. Under french debt collection laws, amicable settlements of dispute stand as the only possible recourse to recovering unpaid debts in a commercial/consumer relationship.

It is advisable therefore to contact your debtor through a third-party such as a debt collection lawyer. In these cases, we recommend you hire a lawyer as early as possible

The general rule however is that collecting unpaid dues after the statute of limitation is very close to impossible. Only exceptional circumstances allow a creditor to pursue a defaulting debtor following these strict delays.

French debt collection laws have made amicable settlement of dispute a top priority between creditors and debtors.

Your first step to recovering your debt must therefore be an attempt at resolving your conflits outside of a court of law.

First, you will want to send out a formal demand letter. This signifies for your debtor and for the courts, the official date at which the debtor defaults.

Second, your lawyer will organize either mediation or conciliation proceedings between both parties.

Lastly, have your lawyer request an interim injunction order from the Courts. For further information on what an interim injunction order consists of, see our thorough review of French dispute resolution methods

If this fails, only then may you involve the Courts through judicial proceedings. When looking to pursue legal action you must ask yourself the following questions:

First, you will want to send out a formal demand letter. This signifies for your debtor and for the courts, the official date at which the debtor defaults.

Second, your lawyer will organize either mediation or conciliation proceedings between both parties.

Lastly, have your lawyer request an interim injunction order from the Courts. For further information on what an interim injunction order consists of, see our thorough review of French dispute resolution methods

If this fails, only then may you involve the Courts through judicial proceedings. When looking to pursue legal action you must ask yourself the following questions:

In the rare case that your claim goes uncontested in front of the judge, your cheapest option will be to have your lawyer file for an Order for Payment Proceeding. Your debt collection lawyer will then request an immediate payment of the unpaid debt.

What we see more frequently however is your debtor quickly contesting the existence or amount of your claim. This complicates the proceedings and your lawyer will be brought to file for Summary Proceedings. A summary judgement involves an element of urgence and allows for the judge to issue an expedited decision.

The most common measure in French debt collection cases is an ordinary civil proceeding. In these cases, the judge is seized on both procedural and legal aspects of your claim. If ruled in your favor, the Courts will issue a writ of summons for immediate payment notification to your defaulting debtor.