The new directive on combating late payments in commercial transactions (the "Directive") was published on 16 February 2011. It is due to be transposed into Irish law prior to 16 March 2013. The Directive was adopted in an effort to develop a business environment supportive of timely payments in commercial transactions and to improve the liquidity of small and medium enterprises in the European Union. The Directive will replace the existing Late Payments Directive which is implemented in Ireland by way of the European Communities (Late Payments in Commercial Transactions) Regulations 2002 (the "2002 Regulations"). Provisions of the New Directive 1. Payment Periods Where the contract does not specify a payment period, the debtor must make payment within 30 calendar days, following the date of receipt of the invoice or, if the date of the receipt of the invoice is uncertain, 30 days after the date of receipt of the goods or services (the "Overdue Date"). The Directive provides that Member States shall ensure that the period for payment fixed in the contract does not exceed 60 days, unless otherwise expressly agreed in the contract. In the case of commercial transactions between private undertakings and public authorities, the Directive provides that where goods or services are supplied to a e the payment period should not normally exceed 30 calendar days of the Overdue Date. However, a longer payment period is allowed where it is it is objectively justified and expressly agreed in the contract, or where the public authority provides healthcare services or services of an industrial or commercial nature. In any event, the longer payment period referred to above cannot exceed 60 calendar days. 2. Interest The interest rate to be applied in respect of late payments will be the European Central Bank (the "ECB") main refinancing rate, plus 8%, unless otherwise agreed. Creditors will...
Better Late Than Never: The New Directive On Late Payments In Commercial Transactions
|Author:||Mr John O'Connor, Yvonne Cunnane and Andreas Carney|
|Profession:||Matheson Ormsby Prentice|
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