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Export Debt Recovery After Brexit: A Comprehensive Guide to Incoterms, Currency Fluctuations, and Late-Payment Interest Claims
Recovering an unpaid export invoice after Brexit can involve extra customs evidence and enforcement steps, but a properly documented debt remains recoverable. Governing law, jurisdiction, the Incoterms® rule, invoice currency and proof of delivery all affect the route available. Specialist international debt collection can coordinate demands, local agents and legal action.
Incoterms: responsibilities, costs and risk
Incoterms® 2020, published by the International Chamber of Commerce, allocate transport obligations, costs and risk. They do not determine ownership, payment terms, governing law or jurisdiction.
| Incoterm | Seller’s obligation | Risk normally passes |
|---|---|---|
| EXW | Makes goods available at the named place, normally without loading | When placed at the buyer’s disposal |
| FCA | Delivers to the buyer’s carrier at the named place | When delivery to the carrier is completed |
| FOB | Places goods on board the nominated vessel; sea or inland waterway only | Once on board at the shipment port |
| CFR or CIF | Arranges carriage; CIF also requires insurance | Once on board at the shipment port |
| DAP or DDP | Delivers to the named destination; DDP includes import clearance and duties | At the named destination |
Keep the contract, invoice, customs declaration, transport document and proof of delivery together. A retention of title clause may help, but its effectiveness abroad depends on local law and may require registration.
Currency fluctuations
If you invoice in euros and sterling strengthens before payment arrives, the sterling value falls. State the currency, payment account, bank-charge allocation and any exchange-rate mechanism clearly. Larger contracts may justify hedging. A prompt debt collection letter can reduce delay but cannot remove currency risk.
Late-payment interest
Brexit did not repeal the Late Payment of Commercial Debts (Interest) Act 1998. Where it applies, qualifying B2B debts can carry statutory interest at 8% above the Bank of England base rate, unless the contract provides another substantial remedy. Fixed compensation is £40 for debts below £1,000, £70 for debts from £1,000 to £9,999.99 and £100 for debts of £10,000 or more.
These rights do not automatically apply to every overseas buyer merely because a contract chooses English law. For an international contract, the Act may not apply where there is no significant UK connection and foreign law would otherwise govern. Confirm the applicable law before you charge statutory interest. The same disciplined B2B debt recovery approach applies: separate the principal, interest and recoverable costs.
Jurisdiction and enforcement
For new disputes, the EU Brussels regime generally no longer governs UK-EU enforcement. The Hague 2005 Convention can support qualifying exclusive jurisdiction clauses. The Hague Judgments Convention 2019 entered into force for the UK on 1 July 2025. Subject to its scope and transitional rules, it can assist enforcement between the UK and participating states, including EU member states other than Denmark, where proceedings began after the Convention took effect between the states concerned.
An arbitration clause may offer broader reach. The New York Convention has 172 parties, although enforcement still depends on the award and local law. Address genuine disputes and counterclaims before issuing proceedings.
The practical route to payment
Begin with a documented demand, then assess assets, limitation periods, jurisdiction and enforcement costs. The 5 simple steps for overseas debt collection and a structured cross-border debt recovery process can help determine when to escalate. Before extending more credit, run a credit check and use outsourced credit control. Specialist construction debt collection may be appropriate where notices, valuations or set-off issues arise.
Frequently asked questions
Can you claim late-payment interest from an EU customer after Brexit?
Potentially. Statutory interest and compensation may be available where the 1998 Act applies, but an English-law clause alone does not guarantee entitlement.
How do you recover an unpaid EU invoice?
Send a clear demand supported by the contract, invoice and delivery evidence. Then identify the correct court or arbitration forum and where the buyer’s assets are located.
Which Incoterms are best for exporters?
There is no universal best rule. Choose the term matching your control over freight, customs, insurance and delivery risk, and name the exact place or port.
Recover what you are owed abroad
An export debt is not automatically a write-off. Send the buyer’s details, contract, invoice value, currency, delivery evidence and chasing history to our debt collection agency, and the team will assess the most practical recovery route.
Need Expert Debt Collection Advice?
If your business is dealing with overdue invoices or difficult debtors, speak to Taurus Collections for practical, professional support with commercial debt recovery.
Karl Baker
Karl Baker is the founder of Taurus Collections and his company has helped recover over £1.1 million worth of debt with an average recovery rate of 91.5%.