The Commission has stated that it will soon table a Proposal to
reduce late payments in Europe.
Long payment periods have detrimental cash-flow
effects and evidence suggests that small and medium-sized
enterprises (SMEs) are particularly hard hit by late payments. In
May 1995, the Commission issued a Recommendation on late payments
but recent surveys show that this has had little effect.
Contractually agreed payment periods in 1996 ranged from as little
as 19 days in Finland to 75 days in Greece. Average late payments
ranged from 7 days in Sweden and Denmark to 19 in Greece and 41 in
Portugal. The average figures for the EU are 39 contractual credit
days and 15 days overdue.
The Commission thinks that minimum standards are
necessary, such as a statutory right for creditors to interest on
late payments. Putting its money where its mouth is, the Commission
has promised to pay interest to its own creditors if payments are
not made within 60 days.