Coventry Best 4 Business

A new policy approach to tackle the situation on late payments has been announced by the European Commission.  The Commission suggests that public authorities should lead by example and should, as a rule, pay their bills within 30 days. In parallel, the Commission commits itself to speed up payment of goods and services so as to fully respect the targets for paying bills and, in a number of cases, even shortening payment times to under the current legal period.

The proposal involves substantial changes to the late payment directive (2000) and will improve the cash flow of European business which is particularly important in times of economic downturn.

It will also facilitate the smooth functioning of the internal market by eliminating related barriers to cross-border commercial transactions. This will be achieved by providing creditors with instruments that enable them to fully and effectively exercise their rights when paid late and by confronting public administrations with measures that effectively discourage them from paying late.

European Commission Vice-President Günter Verheugen, responsible for enterprise and industry policy, stated: “Late payment by public administrations should be no longer tolerated. Today’s proposal provides an important impetus to overcome the economic crisis by helping to avoid further bankruptcies and promoting businesses’ cash flow in order to reinforce the competitiveness of European enterprises in the long term.”