Commercial debt recovery: processes, procedures and key considerations
An invoice that remains unpaid after 30 days generates a cash flow cost. At 90 days, it becomes a financial risk. Beyond that, it can sometimes threaten the very survival of the creditor company. In France, the average payment period between businesses is around 50 days, and late payments are the leading cause of failure among SMEs.
The recovery of a trade debt follows a step-by-step process, ranging from amicable reminders to enforcement, including legal proceedings, the choice of which depends on the nature of the debt, the debtor’s behaviour and the urgency of the situation. This article outlines the key stages of this process and the main legal avenues available to the creditor.
The key stages of recovering a commercial debt:
- Build a solid case file as soon as the debt arises (contract, invoices, proof of delivery).
- Initiate amicable reminders within a reasonable time after the due date.
- Send a formal notice of default by registered post with acknowledgement of receipt.
- Where necessary, seek protective measures to safeguard your rights.
- Choose the appropriate legal procedure: payment order, summary proceedings, or proceedings on the merits.
- Proceed with the enforcement of the enforceable order obtained.
The amicable phase: reminders and formal notice
Preliminary reminders
Before taking any legal action, the amicable phase is an essential prerequisite, both practically and strategically. A prompt and well-documented reminder often allows an outstanding debt to be resolved without going to court, whilst preserving the business relationship.
Reminders may take the form of letters, telephone calls or emails. Their content must be factual: invoice reference, amount due, overdue date, and a reminder of the contractual payment terms. Each reminder must be kept in writing, as it constitutes useful evidence in the event of a dispute.
The formal notice
The formal notice marks the final step before litigation. It is sent by registered post with acknowledgement of receipt and must clearly identify the debt claimed, its contractual basis, and set a reasonable deadline for payment. Pursuant to Article 1231-6 of the Civil Code, the formal notice triggers default interest at the statutory rate from the date of its receipt by the debtor.
Beyond its legal effect, the formal notice serves a crucial evidential purpose: it demonstrates to the court that the creditor has attempted to resolve the dispute amicably and that the debtor has failed to comply despite a formal demand.
The simplified small claims recovery procedure
For contractual claims not exceeding €5,000 in principal and interest, a simplified procedure allows recovery to be entrusted to a judicial officer. If the debtor agrees to participate in the procedure and an agreement is reached on the amount and terms of payment, the judicial officer issues an enforceable order without the judge’s intervention, pursuant to Article L. 125-1 of the Code of Civil Enforcement Procedures. If the debtor fails to respond within one month, their silence is deemed a refusal, and the creditor must then apply to the court.
Payment order: a fast-track procedure for uncontested claims
Conditions and scope of application
The payment order is the preferred procedure for the recovery of uncontested commercial debts. It enables an enforceable order to be obtained quickly and at low cost, without an initial adversarial hearing.
Pursuant to Article 1405 of the Code of Civil Procedure, this procedure is available where the debt arises from a contract or a statutory obligation and is for a specific amount. It is also available where the obligation arises from the acceptance or drawing of a bill of exchange, the issuing of a promissory note, or the acceptance of an assignment of trade debts. There is no upper limit on the amount of the debt.
The creditor files an application with the President of the Commercial Court (for commercial claims) or the Civil Court, accompanied by supporting documents. The judge rules without summoning the debtor: if he considers the application to be well-founded, he issues an order for payment.
Service and time limits
The order must be served on the debtor within six months, failing which it lapses. Service of the order interrupts the limitation period, unlike the filing of the application itself. The debtor then has one month to lodge an objection. If the debtor lodges an objection, enforcement of the order is suspended and the entire dispute is examined by the court.
In the absence of an objection, the payment order becomes enforceable and the creditor may proceed with enforcement.
The 2026 reform
The Decree of 16 February 2026 reforming the order for payment significantly alters the procedure. For orders issued from 1 September 2026 onwards, the service period is reduced to three months. The court registry will only notify the creditor of any objections lodged, within one month of their receipt.
If no notice of opposition is received within two months of service, the creditor may proceed directly with enforcement of the order. This reform aims to speed up recovery, but requires the creditor to exercise greater diligence in meeting deadlines.
Summary proceedings: obtaining prompt payment of a debt that is not seriously contestable
The principle: the absence of a serious dispute
Where the debt is not seriously contestable but the debtor refuses to pay, summary proceedings for provisional payment offer a fast track to obtaining an interim relief. In practice, the order granting provisional payment is rarely followed by proceedings on the merits.
Pursuant to Article 835(2) of the Code of Civil Procedure (and Article 873(2) for the Commercial Court), the interim relief judge may issue a provisional payment order provided that the obligation is not seriously disputed. The condition of urgency is not required for this claim. The amount of the provional payment may be equal to or less than the total amount of the claim.
The limits of summary proceedings
The judge hearing the application for interim relief rules only on a provisional basis: his decision does not have the force of res judicata and does not definitively establish the claim. The Court of Cassation exercises strict control over the concept of a serious challenge. If the defence raised by the debtor is such as to affect the basis of the obligation or the very principle of the claim, the application for a provisional payment will be dismissed. This is the case, for example, where an expert opinion is required to determine the defendant’s liability.
Furthermore, summary proceedings is ineffective where the debtor is subject to insolvency proceedings. The Court of Cassation considers that such proceedings are not ongoing proceedings within the meaning of French insolvency rules and the application for provisional payment becomes inadmissible (judgment of 26 June 2019, No. 18-16.777).
The summons to the main proceedings: the route to full litigation
When to resort to proceedings on the merits
The summons to the court of first instance is the standard legal route where the claim is seriously contested, the facts are complex, or the stakes warrant a thorough examination.
This procedure allows for a full adversarial hearing and results in a judgment which, once it has become final, constitutes an enforceable title. It is longer and more costly than simplified procedures, but it is the only one that allows for an exhaustive examination of the dispute.
Interim measures: securing the claim before judgment
Where the creditor fears that the debtor may be arranging their insolvency, they may apply for a protective measure even before obtaining an enforceable title. Pursuant to Article L. 511-1 of the Code of Civil Enforcement Procedures, any person whose claim appears to be well-founded in principle may obtain authorisation from the court to impose a protective measure on their debtor’s assets, provided they can demonstrate circumstances likely to jeopardise recovery.
The protective attachment of monetary claims renders sums held by a third party (typically a bank) on behalf of the debtor unavailable. It must be served on the third party against whom the attachment is made, and then notified to the debtor within eight days. It must be followed by the initiation of proceedings to obtain an enforceable title within one month of its execution.
For further information: Freezing of assets and enforcement measures.
The limitation period: a common pitfall
The limitation period for bringing an action for payment of a commercial debt is five years, pursuant to Article L. 110-4 of the Commercial Code. This period runs from the day on which the creditor became aware, or ought to have become aware, of the facts enabling them to bring their claim, and is interrupted by the service of the order for payment, by a summons to appear in court, or by the debtor’s acknowledgement of debt.
Conclusion
The recovery of a commercial debt requires a structured approach, from the amicable phase through to enforcement, including the selection of the legal procedure best suited to the nature of the debt and the debtor’s circumstances.
To safeguard your recovery procedures or define the strategy best suited to your situation, our firm supports you at every stage, from the formal notice to the enforcement of the enforceable order.
Frequently Asked Questions
What is the limitation period for recovering a commercial debt?
The limitation period is five years, in accordance with Article L. 110-4 of the Commercial Code. It begins to run from the date on which the creditor became aware, or ought to have become aware, of the facts enabling them to bring an action, which generally corresponds to the date on which the service was performed between businesses.
Is a formal notice required before initiating debt recovery proceedings?
There is no legal requirement to send a formal notice before bringing a case before the court in relation to the recovery of a commercial debt. However, it is strongly recommended: it triggers the accrual of default interest, serves as evidence of the debtor’s refusal to pay, and demonstrates the creditor’s good faith to the court. In certain cases (such as the simplified small claims procedure, for example), a prior attempt at amicable settlement is, however, a procedural prerequisite.
What is the difference between a payment order and summary proceedings?
A payment order is a non-adversarial procedure designed for uncontested claims, with no upper limit on the amount. On the other hand, summary proceedings require that the claim not be seriously contestable and results in a provisional decision issued following an adversarial hearing. A provisional judgment is particularly useful when the creditor needs prompt payment from a debtor who refuses to pay without good cause.
Is it possible to obtain a protective attachment order before a judgment has been made?
Yes. A creditor whose claim appears to be well-founded in principle may obtain a court order to place a protective attachment on the debtor’s assets, provided they can demonstrate that circumstances exist which threaten the recovery of the debt. This measure serves to freeze the debtor’s funds or assets pending the issuance of an enforceable order.
What should you do if the debtor is subject to insolvency proceedings?
The commencement of safeguard, receivership or winding-up proceedings results in a prohibition on individual legal proceedings against the debtor. Creditors must therefore lodge their claims with the court-appointed administrator within two months of the publication of the order commencing proceedings in the BODACC, failing which their claims will be time-barred.