Statutory interest rate and statutory commercial interest rate to rise from 1 January 2023

Statutory (commercial) interest as compensation for delay damage

If your debtor does not pay on time, you (potentially) suffer delay damages. Your liquidity decreases. You may not be able to pay your own creditors or you may have to delay your investments. You are deprived of an opportunity for returns. This is subject to liquidated damages: statutory interest and statutory commercial interest.

Statutory (commercial) interest is liquidated damages

Because damages for delay in payment of a sum of money are difficult to determine, the legislator has fixed damages for delay in payment of a sum of money at a fixed percentage of statutory (commercial) interest, irrespective of whether the creditor has actually suffered damages and irrespective of their amount, if any. This avoids uncertainties of an evidentiary nature, among others.

For non-commercial transactions (including transactions with consumers), the statutory interest rate under Section 6:119 of the Civil Code applies; for commercial transactions, the statutory commercial interest rate under Section 6:119a of the Civil Code applies.

Interest rates go to 4% and 10.5% respectively from 1 January 2023

From 1 January 2023, new, higher rates of statutory interest and statutory commercial interest will apply. From 1 January 2023, the statutory interest rate will be 4%. That was 2%. As of 1 January 2023, statutory commercial interest will be 10.5%. That was 8%. The new percentage for statutory interest was set by Order in Council dated 15 December 2022. The new commercial interest rate automatically follows the refinancing rate set by the European Central Bank pursuant to Article 6:120(2) of the Civil Code. See also this central government website.

When is statutory (commercial) interest due?

Statutory interest is due from the day following that on which the debtor defaulted on payment of the sum of money (See, for example, HR 20 June 2014, ECLI:NL:HR:2014:1490, paras 5.1 and 5.2) until the debtor is no longer in default.

The main rule is that for default to occur, the debtor must be given notice of default by means of a written demand for payment in which he is given a reasonable period for performance and performance is not achieved within this period (Article 6:82 paragraph 1 of the Civil Code). In addition to this main rule, default may also occur, inter alia, if the debtor fails to perform within a fatal term (Article 6:83 opening words and under a BW) and if an obligation arising from an unlawful act or an obligation to pay damages (within the meaning of Article 6:74 BW) is not immediately complied with (Article 6:83 opening words and under b BW) and if the creditor must infer from a communication from the debtor that he will not perform (Article 6:83 opening words and under c BW).

For more on default, see our 31 December 2019 blog in the Contract Law Series.

For commercial transactions – in brief – the statutory commercial interest due on account of delay in the payment of a sum of money is payable from the day following the day agreed as the final day for payment up to and including the day on which the debtor has paid the sum of money and, if no final day for payment has been agreed, from 30 days after the commencement of the day following that on which the debtor received the invoice.

Update 16 January 2024

With effect from 1 January 2024, the statutory interest rate and statutory commercial interest rate were again increased, this time to 7 and 12.5% respectively. See our blog of 16 January 2024 on this subject.

Wieringa Advocaten is happy to assist you

Do you want to collect a debt? Or do you have questions about interest, damages or default? Feel free to contact us. Wieringa lawyers will be happy to assist you.

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