Law 69.21 on payment terms: what businesses need to know.

Why does Law 69.21 matter so much to businesses?

Payment terms are a key factor in a company’s cash flow and financial stability. To combat late payment and improve business relationships, Morocco has strengthened its regulatory framework through Law 69.21 on payment terms.

This law sets legal deadlines, requires businesses to report their late payments to the Directorate General of Taxes (DGI) and provides for a fine paid to the State in the event of late payment. It requires businesses to adapt their accounting and financial practices.

Businesses covered by Law 69.21

The law applies to legal entities and to individual traders whose annual turnover exceeds 2,000,000 dirhams excluding tax. The reporting obligations and the fine for late payment apply to businesses whose turnover exceeds this threshold.

Invoices issued before 1 January 2025 for an amount of 10,000 dirhams or less were exempt from the fine. Since that date, all invoices are covered, with no minimum amount.

Legal payment terms

The law sets clear maximum terms, depending on whether or not there is a written agreement between the parties:

• 60 days maximum in the absence of a written agreement
• 120 days maximum when a written agreement is expressly stated on the invoice

These terms are a legal ceiling that cannot be exceeded, even by agreement between the parties.

Two separate consequences of late payment

Late payment triggers two different obligations, which should not be confused:

Late payment penalties owed to the supplier

A supplier paid late can claim compensation from its customer, in the form of late payment penalties at a rate set by regulation. These sums go to the supplier and offset the impact of the delay on its cash flow.

The fine paid to the State

Separately from these penalties, a business that pays late must voluntarily pay a fine to the Treasury, at the same time as its report to the DGI. It is calculated on the unpaid amount including VAT:

• at Bank Al-Maghrib’s key rate in force for the first month of delay;
• plus 0.85% per month or part of a month of additional delay.

The first month’s rate therefore follows Bank Al-Maghrib’s decisions. This fine does not go to the supplier. For disputed invoices that have been taken to court, it is only due after the final judgment.

Reporting obligations

The businesses concerned file a quarterly electronic report with the DGI, before the end of the month following each quarter, whether or not payment terms have been met.

A transitional measure allowed businesses with turnover below 50 million dirhams to file an annual report for the 2024 and 2025 financial years, before moving to quarterly reporting.

Invoicing rules to follow

The law also strengthens invoicing obligations.

Every invoice must be issued no later than the end of the month in which the sale or service took place.

This requirement calls for better organisation of invoicing and of the follow-up of customer receivables.

Mandatory certificate

A certificate of compliance with payment terms is now required, depending on turnover:

• Turnover of 50 million dirhams or more: certificate issued by a statutory auditor
• Turnover between 2 and 50 million dirhams: certificate issued by a chartered accountant

This certificate becomes a key element of regulatory compliance.

Penalties provided for by the law

Failure to report or late reporting, as well as non-payment of the fine, is penalised by a fine whose amount depends on turnover:

• 5,000 dirhams for turnover between 2 and 10 million dirhams;
• 12,500 dirhams between 10 and 50 million;
• 50,000 dirhams between 50 and 200 million;
• 125,000 dirhams between 200 and 500 million;
• 250,000 dirhams above 500 million.

An incomplete report also exposes the business to a fine of 5,000 dirhams per missing or incorrect invoice.