Statutory Interest on Damages: When Does the Clock Start Ticking?

By mr. Vincent Besters

Loss suffered, but when does interest accrue?

Consider this: your regular supplier repeatedly delivers late, causing you to miss out on a major order. You establish the breach of contract, engage a lawyer and submit a damages claim. The loss amounts to €150,000. Then comes the question that catches many business owners off guard: from what moment are you, as the creditor, entitled to statutory interest, and how quickly does that debt actually accumulate? The answer is legally more nuanced than most people expect, and financially more relevant than many realise.

What is statutory interest and why does it matter?

Statutory interest is the compensation granted by law when a monetary claim is not paid on time. It is not a contractual arrangement but a statutory right, governed by Book 6 of the Dutch Civil Code. The rationale behind statutory interest is straightforward: money has a time value. Those who wait too long for payment suffer financial loss. Statutory interest compensates for that loss in a standardised manner, without requiring the creditor to demonstrate their actual financing costs.

For business owners, statutory interest is of considerable practical importance for two reasons. First, the interest debt can accumulate substantially over the course of protracted legal proceedings. Second, the moment at which interest begins to accrue partly determines the total amount of the compensation. That moment therefore warrants careful legal attention.

When does interest begin to accrue: direct loss versus capitalised loss

In cases of direct loss, such as an unpaid invoice or costs already incurred, statutory interest generally begins to accrue at the moment the debtor enters into default. This is in principle triggered by a notice of default, unless performance has become permanently impossible or the debtor has indicated in advance that they will not pay.

In cases of future loss that is capitalised, the position is more nuanced. Consider, for example, loss of profit over the coming years, expressed as a single lump sum as at the date of the judgment or the loss calculation. The Supreme Court recently provided important clarification on this issue in its judgment of 27 June 2025 (ECLI:NL:HR:2025:1388). The Supreme Court confirms that statutory interest on capitalised future loss does not, in principle, begin to accrue until the moment that loss is established and becomes due and payable, and not already from the moment of the loss-causing event. This judgment underscores the importance of a carefully prepared and well-substantiated loss calculation at the outset of proceedings.

Article 6:119 DCC versus Article 6:119a DCC

Not all interest rates are equal. The law draws a distinction between two situations. Article 6:119 of the Dutch Civil Code applies to non-commercial transactions and carries a lower rate of interest, set annually by the Minister and currently standing at around four percent. Article 6:119a of the Dutch Civil Code applies to commercial transactions, that is, transactions between businesses, or between businesses and public authorities, where payment is owed for goods or services supplied. The interest rate under Article 6:119a DCC is structurally higher and currently amounts to over ten percent per annum.

In practice, in cases of breach of contract between commercial parties, Article 6:119a DCC is therefore the relevant provision, unless the damages claim relates to non-commercial heads of loss. On a claim of €150,000 spanning several years, the distinction can result in a difference of tens of thousands of euros.

How can you limit the interest debt as the defending party?

If you are on the other side of the table, the party against whom a claim is being brought, there are measures available to limit your interest exposure. Respond promptly to notices of liability, make a serious settlement offer and pay out any undisputed portions of the claim without delay. Every day that a monetary claim in a commercial transaction remains unpaid costs you over ten percent per annum. This makes an early settlement financially more attractive in many cases than continuing to litigate, even if you believe you have the stronger legal position.

Do you have questions about agency or contractual liability?

Mr. Vincent Besters advises entrepreneurs on contract law, agency arrangements and liability issues. Feel free to get in touch for an initial consultation.

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