DLR to reject postponing new French payment law

The French rental and distributors association DLR is to reject proposals from two main contractors associations to postpone the introduction of new laws on payment periods.

The law, which is due to come into force on 1 January 2009, will see payment periods limited to 60 days (or 45 days from the end of the month when the invoice was submitted). It is not uncommon now for payment periods to exceed 100 days.

The law allows for trade associations to negotiate a three year postponement of the regulations, and DLR has received invitations to agree a delay from two of the largest bodies representing rental customers - FNTP (for public works) and FFB (building).

However, there was overwhelming opposition to accepting such a delay from rental companies at the DLR's rental meeting on 3 December, held on the day before the DLR was scheduled to reply to the proposals.

Laurent Vronski, managing director of ENVE-Location, received enthusiastic applause at the meeting when he urged DLR to reject the proposed agreements. Mr Vronski told IRN; "I'm strongly against a deal with contractors...The regulation is going to make a big difference. It will mean more cash in hand, immediately."

Herve Cohade, president of DLR's rental section, said France's rental companies would benefit by as much as €300 million a year from the regulations, and urged companies to apply the new laws.

Michel Gable, president of DLR, said a final decision on the proposed agreements would be taken at a board meeting on 4 December, but that it was likely that DLR would reject any agreement to postpone the new regulations.

Although most of the rental companies attending the DLR meeting were against the agreements, there were some dissenting views. Gerard Deprez, managing director of Loxam, told IRN that he was in favour of reaching agreements with the main contracting organisations. He said contractors might apply pressure in other ways if they were made to comply immediately with the 60/45 day payment terms.