Late Payment Directive
Late payment - European Union (EU) - small & medium-sized enterprises.
The EU's Directive 2011/7/EU on combatting late payment in commercial transactions, 2011.
The Late Payment Directive's main provisions include:
- Public authorities to pay for most goods and services that they buy within 30 days.
- Other organisations to pay their invoices within 60 days, unless they expressly agree otherwise - and provided it is not grossly unfair.
- Automatic entitlement to interest for late payment.
- Statutory interest on late payment of at least 8% above the European Central Bank’s reference rate.
EU member countries may continue maintaining or bringing into force laws and regulations which are more favourable to the creditor than the Late Payment Directive.
Member countries had to implement the Late Payment Directive into their local national laws by 2013.
Despite the Late Payment Directive, small and medium-sized organisations continue to have substantial problems with slow payments - especially by their larger customers.
Many suppliers remain reluctant to exercise their rights, for fear of damaging commercial relationships - especially with their largest customers.
See also
- Chartered Institute of Credit Management
- Credit
- Directive
- European Central Bank (ECB)
- European Commission
- European Union (EU)
- Norm
- Open account
- Payment practices reporting
- PPC Compliance Board
- Prompt Payment Code
- Reference rate
- Small and Medium-sized Enterprises
- Small Business Commissioner
- Statutory interest
