Consumer debt collection in Belgium: the rules of Book XIX

Anyone engaged in consumer debt collection in Belgium must play by strict rules. Book XIX “Consumer debts” of the Code of Economic Law (Wetboek van economisch recht / Code de droit économique) sets out when a business may charge costs and interest, how much, and what must happen first. A business that ignores these rules cannot rely on its penalty clause.

For businesses, compliance is therefore not a formality but a matter of money; for consumers, it is an important protection. This article sets out the rules, with a step-by-step plan for businesses and points of attention for consumers.

Consumer debt collection in Belgium: when does Book XIX apply?

Book XIX was introduced by the Act of 4 May 2023. It applies to debts owed by consumers to businesses. Since 1 September 2023 it has applied to new contracts and, since 1 December 2023, also to older contracts for payment arrears and collection from that date onwards.

The former Act of 20 December 2002 on the amicable collection of consumer debts was incorporated into Book XIX at the same time. The rules on collection agencies and other debt collectors are therefore now found in the same book as the rules on the reminder and the penalty clause.

Step 1: the free first reminder

If a consumer does not pay on the due date, the business must first send them a free reminder (Article XIX.2 of the Code of Economic Law). This can be done on paper or electronically. The reminder states, among other things:

• the name and company number of the business;
• a description of the goods or services and the due date;
• the amount owed;
• the period within which the consumer can pay without additional costs;
• the interest and the penalty clause that may be charged if the consumer does not pay on time.

If any of these particulars is missing, the reminder becomes vulnerable and the penalty clause may later be jeopardised. Keep a copy of every reminder and proof that it was sent.

Step 2: at least fourteen calendar days to pay

After the reminder, the consumer has at least fourteen calendar days to pay. For a paper reminder, that period starts on the third working day after it is sent. For an electronic reminder, it starts on the calendar day after it is sent. No costs or interest may be charged during that period.

For contracts for the regular supply of goods or services, such as energy or telecoms subscriptions, no costs may be charged per calendar year for reminders concerning non-payment of three due dates. For additional reminders, the cost may not exceed EUR 7.50 plus the applicable postage (Article XIX.2, § 2 of the Code of Economic Law).

Step 3: what interest and compensation can you then charge?

If the consumer does not pay within that period, the business may charge late-payment interest and fixed compensation, but only if the contract provides for them and within the caps set by Article XIX.4 of the Code of Economic Law.

Interest: at most the reference interest rate plus eight percentage points.

Fixed compensation:

• amount owed up to EUR 150: a maximum of EUR 20;
• between EUR 150.01 and EUR 500: EUR 30 plus 10% of the amount owed in the band between EUR 150.01 and EUR 500;
• above EUR 500: EUR 65 plus 5% of the amount owed in the band above EUR 500, up to a maximum of EUR 2,000.

The percentages apply only to the relevant band, not to the full amount. An example: for an outstanding amount of EUR 300, the compensation is at most EUR 30 plus 10% of EUR 150, i.e. EUR 45. For EUR 800, it is at most EUR 65 plus 5% of EUR 300, i.e. EUR 80.

What if the business does not comply with the rules?

If the free reminder was not sent or the period was not observed, the business cannot apply its penalty clause or its late-payment interest: the consumer is exempt by operation of law from paying the penalty clause (Article XIX.15 of the Code of Economic Law). A penalty clause containing amounts other than those permitted by law is prohibited and deemed unwritten (Article XIX.4 of the Code of Economic Law). The business then loses the benefit of that clause entirely.

The principal amount, of course, remains due. For contracts concluded before 1 September 2023, the transitional rule in Article 15, § 2 of the Act of 4 May 2023 applies (see above).

In practice, this means that the business’s general terms and conditions, invoice wording and reminder letters must comply with Book XIX. A clause drafted before 2023, for instance a 15% penalty clause with no ceiling, will as a rule no longer comply. More on drafting general terms and conditions.

Step-by-step plan for businesses

1. Include in your general terms and conditions an interest rate and a penalty clause that stay within the statutory caps.
2. Make sure the consumer knows and accepts those terms before the contract is concluded.
3. In the event of non-payment, send a free reminder with all mandatory particulars, and keep proof that it was sent.
4. Observe the fourteen-calendar-day period correctly.
5. Then calculate the interest and fixed compensation per band, and set out the calculation in your next letter.
6. Only then instruct a lawyer, a bailiff (gerechtsdeurwaarder / huissier de justice) or a registered collection agency, and give them the complete file.

Collection by a lawyer, bailiff or collection agency

Anyone who collects a consumer debt amicably on behalf of a business is also bound by Book XIX. Collection agencies must be registered with the FPS Economy for this purpose. Lawyers and bailiffs are exempt from registration, but not from the rules themselves.

At the start of amicable collection, the debt collector must check that the reminder stage was handled correctly and that the amounts claimed stay within the statutory caps. The collector may not demand any compensation, fee or costs from the consumer for its intervention (Article XIX.13 of the Code of Economic Law). It is therefore in the business’s interest that its file is in order from the first reminder onwards. More on the formal notice of default.

And if amicable collection fails?

Court proceedings may then follow, as a rule before the justice of the peace (vrederechter / juge de paix) for claims up to EUR 5,000. The justice of the peace checks whether the amounts charged have a legal basis, and unlawful costs are struck out.

A properly built file, with the reminder, proof of sending and the calculation of the amounts, makes the difference. Keep an eye on limitation periods too: in certain cases, a claim by a seller of goods against a private individual becomes time-barred after just one year (Article 2272 of the old Civil Code). More on limitation periods for invoices.

For consumers: what should you look out for?

If you receive a demand for payment with high costs, check whether you first received a free reminder, whether the fourteen-day period was observed and whether the amounts charged stay within the statutory caps. Dispute anything that is incorrect, in writing and with reasons, and pay the undisputed part in the meantime.

Do not ignore a demand for payment or a summons: if you do not respond, you ultimately risk a default judgment and attachment of your assets. If you have several debts you can no longer manage, a collective debt settlement (collectieve schuldenregeling / règlement collectif de dettes) may offer a way out.

Frequently asked questions

Does Book XIX also apply between businesses?

No. Between businesses, the Act of 2 August 2002 on combating late payment in commercial transactions applies. More on late-payment interest between businesses.

Can I still use a collection agency?

Yes, but choose an agency registered with the FPS Economy and make sure your own reminder stage was handled correctly. Otherwise the collection will fail.

Can the collection agency pass its own costs on to the consumer?

No. The debt collector may not demand any compensation, fee or costs from the consumer for its intervention (Article XIX.13 of the Code of Economic Law); apart from the principal, only the interest and fixed compensation that Book XIX allows may be claimed. Legal costs in subsequent proceedings, such as the cost of the summons or the procedural indemnity (rechtsplegingsvergoeding / indemnité de procédure), follow different rules: the court decides on them. More on the procedural indemnity.

Can I use the IOS procedure for uncontested monetary debts against a consumer?

No. Collection of uncontested monetary debts through a bailiff, without court proceedings, is reserved for debts between businesses. Against a consumer, you need a court judgment. More on the IOS procedure.

My general terms and conditions provide for a higher penalty clause. What now?

Have them amended. As against consumers, the statutory caps are mandatory, even if the consumer once signed the higher clause.

Novex Advocaten can assist you

We review your general terms and conditions and reminder letters, handle collection correctly and cost-effectively, and defend consumers against unlawful charges. Mr Mohamed Asfour, lawyer, handles your file personally, in Dutch, French, English or Arabic.

Call 0484 99 22 72 or email asfour@novexadvocaten.be.