MEPs on the Internal Market Committee (IMCO) will vote on Thursday 22 February on the report by Róża Thun Und Hohenstein (Renew Europe, Polish), regarding payment periods. The groups agreed on a series of compromise amendments, to which EUROPE had access. However, the key article of the draft regulation relating to payment periods is the subject of an alternative compromise amendment supported by the EPP and ECR groups.
The Commission’s proposal to limit payment periods to 30 days for companies and public authorities was adopted by the rapporteur and supported by most of the groups, subject to a few adjustments.
Some MEPs were calling for flexibility for certain sectors, and a compromise was reached to this effect: the initial payment period could be extended by 30 days for purchases of “certain slow-moving and seasonal goods”. It would be up to the European Commission to adopt a delegated act listing the products in question, according to the compromise amendments.
Another element of flexibility is that the current directive on payment periods will continue to apply for two years to micro-enterprises and the self-employed when they are in debt. This means that they will still be able to sign contractual clauses with their creditors for longer periods.
However, not all SMEs on the continent are convinced by these provisions, and some want more flexibility. This is why the EPP and the ECR will table an alternative compromise amendment, which EUROPE has consulted. This allows companies to negotiate an additional payment period of 30 days for commercial transactions (except when the creditor is an SME and the debtor a large company).
To regulate the use of this extra time, the two political groups want to use the concept of ‘grossly unfair’ contracts. However, this concept, which is present in the current directive, is the subject of debate. It has proved ineffective in protecting creditors because it is difficult to obtain recognition.
Penalties for late payers
The compromise amendments negotiated between the political groups also modify the Commission’s proposal regarding compensation to be paid in the event of failure to meet deadlines. Rather than compensation of €50 per bill, MEPs are proposing a tariff that varies according to the value of the transaction: €50 for transactions under €1,500; then €100 for transactions between €1,500 and €15,000; and finally €150 for transactions over €15,000.
Implementation
In their compromise amendments, MEPs require large companies and contracting public authorities to report their payment patterns once a year to the implementing authorities.
In addition, a European observatory on late payments should be set up, according to MEPs, in addition to the existing payment observatory.
To see the compromise amendments: https://aeur.eu/f/awc (Original version in French by Léa Marchal)