In the context of the EU Industry Days 2022, EBC took part in the session “Pay on time: a win-win solution for resilient supply chains”. EU Industry Days is Europe’s flagship annual event highlighting industrial frontrunners and ongoing EU industrial policy discussions, taking place in Brussels between 8 and 11 February.
EBC Policy Officer Spyros Mathioudakis took the opportunity to exchange with representatives of the European Commission, SMEs and other companies on prompt payment, and shared the views and suggestions of construction SMEs for a zero-tolerance policy towards late payments. He called for the Commission to be brave and move forward with an ambitious revision of the Late Payment Directive, currently dating back to 2011, that will get rid of the problematic “grossly unfair” concept and will provide concrete incentives and obligations for prompt B2B and PA2B payment. This must include an obligatory maximum period of payment not exceeding 30 calendar days for all commercial transactions, but also the need to make the application of interest a legal obligation from the first day of late payment setting a cap for a maximum of 30 days for all payments across the EU.
The session moderator Ms. Antonella Correra, Policy Officer of the European Commission (DG GROW) welcomed the comments and policy recommendations of EBC. She underlined the need to move forward with ambition on the issue of prompt payment, noting that it is documented that the vast majority of SMEs do not even claim the Compensation for recovery costs, currently fixed at the amount of 40 euros in the Late Payment Directive. Ms. Correra also recognized the severe repercussions on the entirety of supply chains on cash flow and increased risk of bankruptcy stemming from the phenomenon of late payment – a phenomenon especially burdensome for SMEs in the construction sector.
The European Commission is also moving forward with the creation of an EU Observatory of payments in commercial transactions, which will inter alia be based on the previous experience from the construction sector and the European Construction Sector Observatory (ECSO).
|To read the EBC position paper on Late payment, click here |