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 Post subject: Collecting business debts
PostPosted: Fri Jul 22, 2011 3:26 pm 
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If like us you are kind to your customers and don’t demand advance payment, the following is the cheapest/quickest route to getting your hard-earned dosh from recalcitrant clients. There are also cabinets de recouvrement (debt collectors), but they’ll take 30-40% of the debt for doing what you can do yourself.

After ringing the client and reminding him of his obligation, and getting sweet FA for your pains:

4 stages:

1. Reminder letter (letter de reliance) enclosing copy of invoice 5 days after payment date.

2. 2nd reminder letter (LRAR) enclosing copy of 1st letter + invoice 15 days after 1st.

3. Formal notice to pay (mise en demeure - MED) sent LRAR 30 days after 2nd, enclosing copies of 1st & 2nd letters + invoice.

4. Application to the court for an order to the debtor to pay up (demande en injonction de payer) sent LRAR after expiry of time stated in MED.

Model letters here http://www.lerecouvrement.com/etapes.html

Formulaire injonction de payer http://www.infogreffe.fr/infogreffe/jsp/ip/fonctionnementIP.jsp

Which court?
Location: The appropriate court (see below) for the debtor’s address, unless you have specified a different court in your Conditions Générales de Vente (T&C)*.
Debt under €4,000: Juge de proximité, if creditor a professional and debtor a private individual or vice versa, or private> private (free).
Debt €4,000 - €10,000: Tribunal d’Instance (free).
Debt over €10,000: Tribunal de Grande Instance (free).
Professional > professional debt of any amount: Tribunal de Commerce (fee of €38 payable).

Documents to enclose with Demande: Order from client (if any), signed devis, email/letter acknowledging order, etc. + copies of 1,2,3 above and the facture.

If the court grants the order (injonction), you have 6 months to get a Huissier to serve it on the debtor.
The debtor has one month after service to enter an objection.
If no objection is filed,you ask the court to make the order exécutoire, i.e., it has the power of a judgment against the debtor and his goods and chattels can then be seized (by a Huissier of course).

If the court rejects the Demande, you’ll have to bring proceedings in the usual way.
If the debtor enters an objection, you’ll both be summoned to the court for a hearing/ruling.

*One quarter of business failures in France are due to bad debts. Make sure that you have T&C – in French – and that you specify default interest according to the ECB financing rate (currently 1.5%) + 10%. Very hefty, but should concentrate the minds of the baskets who don’t pay you….

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 Post subject: Re: Collecting business debts
PostPosted: Fri Jul 22, 2011 9:19 pm 
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Thanks, Mad!

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 Post subject: Re: Collecting business debts
PostPosted: Sat Jul 23, 2011 7:05 am 
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Thanks for that, MAD - it's worth of being a sticky !


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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 10:56 am 
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Joined: Sat Mar 19, 2011 5:58 pm
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Location: Indre-et-Loire
Oddly enough, this is quite handy as I need a quick bit of advice on a debt.

At the beginning of May, i did some work for folks I know. My invoice is dated 6th May 2013 and as of today they still haven't paid.

On my invoice it does state that they 45 days in which to pay, which is not just two weeks away.

When do you send a gentle reminder that the invoice is outstanding? I'm getting to the stage where I need to pay my quarterly fees plus actually live! It's looking like I might have to temporarily raid my daughter's savings for a month or two (last resort but looking likely).

It's annoying as I know the people easily have the money to pay me. I won't go into exact circumstances but knowing what I know there is no reason on this earth as to why they cannot pay.

Thanks for any advice.

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 11:13 am 
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jools wrote:
On my invoice it does state that they 45 days in which to pay, which is not just two weeks away.


So it's due in 45 days from invoice, not before.

jools wrote:
I'm getting to the stage where I need to pay my quarterly fees

Which I guess you don't usually pay in advance, just like your clients...

Maybe you should rethink your payment period - thanks to certain private clients (usually ex-pats) not stumping up the readies, we now demand payment on receipt of invoice.

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 11:18 am 
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MAD87 wrote:
jools wrote:
On my invoice it does state that they 45 days in which to pay, which is not just two weeks away.


So it's due in 45 days from invoice, not before.



I know. I just didn't think they would be THIS slow in getting around to paying. So, send them the reminder at 45 days then?

As a photographer, I'm starting to find the AE system a bit of a pain. I pay money to go out and take the photos but I can not claim any expenses back. Essentially, I paid out mooney on petrol; hotel costs etc in order to do the job but that money is lost.

Was reading elsewhere on the forum about AGESSA. Wondering if this would suit me better than AE.

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 11:24 am 
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That you'd have to work out, based on your turnover. The cotisations are here, but pay attention to the last 3 paras on the page https://www.agessa.org/getpage_Les-cotisations-d-assurances-sociales-la-CSG-la-CRDS-et-la-contribution-formation-professionnelle_57,,.html

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 12:10 pm 
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Thanks for that.

And thanks for the first part of my question. Just feeling fed up that I have money outstanding when if it was in my bank account things would be tickety boo.

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 2:23 pm 
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jools wrote:
As a photographer, I'm starting to find the AE system a bit of a pain. I pay money to go out and take the photos but I can not claim any expenses back. Essentially, I paid out money on petrol; hotel costs etc in order to do the job but that money is lost.

Would you not cost those into the charge for taking the photos?

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 Post subject: Re: Collecting business debts
PostPosted: Thu Jun 06, 2013 3:35 pm 
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elizag wrote:
jools wrote:
As a photographer, I'm starting to find the AE system a bit of a pain. I pay money to go out and take the photos but I can not claim any expenses back. Essentially, I paid out money on petrol; hotel costs etc in order to do the job but that money is lost.

Would you not cost those into the charge for taking the photos?


It doesn't work like that in the majority of the work I do. I essentially pay out money to travel > Take photos > Place in a library in order that they market them.

Stock photography is like the lottery. The more (quality) images you have out there, the more likely you are to sell your work. For me, it took a good 12 to 18 months slog to see the returns. It is slowly but surely building.

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