Policy Areas  >  Economy & Internal Market  >  Late payments

Late payments

Every day dozens of SMEs in Europe go into default because of the overdue payment of their invoices. As a result jobs are lost and business opportunities vanish, slowing down Europe’s return to economic growth. The highest risk of late payment is expected in Italy, Portugal, Greece, Spain and Romania.

To address this problem the European Union adopted a revised version of the Late Payments Directive (Directive 2011/7/EU) on 16 February 2011. The EU Member States had until 16 March 2014 to implement it.

Several improvements have been introduced by this directive: 

   •  30 days for payment between public administration and enterprises 

   •  Maximum justified extension to 60 days 

   •  60 days for payment between enterprises

   •  Enterprises will be automatically entitled to claim interest for late payment and to obtain a minimum fixed amount of EUR 40 as a compensation for recovery costs 

   •  The statutory interest rate for late payment in the Member States should be increased to at least 8 percentage points above the European Central Bank’s reference

   •  Enterprises will have more opportunities to challenge grossly unfair terms and practices.

The Commission also invites companies and citizens to share information concerning the application of the directive in their own countries, and to send any evidence of problems experienced when applying the new rights conferred by the Directive: ENTR-LATE-PAY-E-DESK@ec.europa.eu. 

The European Builders Confederation welcomes the adoption of this directive, as it should improve the financial conditions and the cash flows of SMEs. It is expected to limit payment delays and most of all the powers of derogations by public authorities and big companies, which use small companies as a kind of ‘personal bank account’.



  • OECD Forum on public procurement for SMEs: a better implementation of the EU Directive is needed - 05/11/2018 - Read more
  • New European Commission study on late payment practices - 28/09/2018 - Read more
  • Construction sector in the UEAPME SME Barometer: positive trends and familiar oscillations throughout 2017 - 04/04/2018 - Read more
  • EBC welcomes Commission’s “zero tolerance” against late payments - 15/02/2017 - Read more
  • Late Payments Directive: results of the evaluation presented - 24/11/2015 - Read more
  • First scrutiny session in IMCO on late payments - 24/06/2015 - Read more
  • Late payments: SMEs should not be used as banks anymore! - 24/11/2014 - Read more
  • Commission initiative against late payments in Italy is welcome - 10/02/2014 - Read more