Bill to Reduce Payment Delays to Combat Business Failures

This French legislative proposal directly targets the widespread practice of late payments between businesses, identified as one of the primary drivers behind the significant increase in business failures observed in France in recent years. The bill seeks to tighten enforcement of existing payment deadlines and introduce stronger deterrents against companies — particularly larger ones — that systematically delay payments to suppliers and contractors. France has seen a marked rise in corporate insolvencies post-pandemic, and chronic payment delays create a cascading liquidity crisis particularly harmful to small and medium-sized enterprises (SMEs). By compelling faster, more reliable payment cycles, the legislation aims to stabilize cash flow across supply chains and reduce the risk of solvent businesses being pushed into default by their clients' delayed payments. The proposal likely builds on the existing European Late Payment Directive (2011/7/EU) framework and French commercial law, proposing stricter penalties, lower statutory interest thresholds, or enhanced powers for supervisory bodies such as the DGCCRF (Directorate General for Competition Policy, Consumer Affairs and Fraud Control) to investigate and sanction offending companies.

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