Irish Regions Office Website

April 11, 2009

Late payments clampdown

The scourge of delays in payments for commercial transactions is coming under added fire after the Commission launched a new policy approach to tackle the situation on 8 April. This announcement is based on a commitment in last year's Small Business Act to reform the Late Payments Directive (2000) in a bid to improve the cash flow of European businesses, particularly SMEs - a problem brought into sharper relief by the economic crisis.

With public bodies being implicated in recent surveys as the worst offenders - taking an average 65 days to pay - the Commission is keen to redress the balance and have this sector lead by example in their dealings with private contractors and suppliers. It intends to have the recast directive transpose a rule into national law whereby those authorities who fail to pay their bills within 30 days will face the automatic prospect of having to pay compensation for recovery costs plus a flat-rate compensation of 5 per cent of the amount due as well as further charges for every day's delay thereafter. The proposal would also make it easier and cheaper for firms to claim interest on overdue business-to-business bills although business-to-consumer transactions are not included.

http://ec.europa.eu/enterprise/newsroom/cf/itemlongdetail.cfm?item_id=3000&tpa_id=128&lang=en

Posted by iroronan at April 11, 2009 07:49 PM