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	COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 8.4.2009

COM(2009) 126 final

2009/0054 (COD)

  DOCPROPERTY "Classification"    

Proposal for a

DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on combating late payment in commercial transactions

(Recast)

Implementing the Small Business Act

{SEC(2009) 315}

{SEC(2009) 316}

EXPLANATORY MEMORANDUM

Context of the proposal

110	Grounds for and objectives of the proposal

Many payments in commercial transactions between businesses or between
businesses and public authorities are made very late after delivery and
often later than agreed or laid down in general commercial conditions.
These practices impinge on liquid assets and complicate the financial
management of enterprises. Late payments affect the competitiveness and
viability of companies, notably SMEs. Payment delays also have a
negative effect on intra-Community commercial transactions. Payment
delays can be responsible for bankruptcies of otherwise viable
businesses with the potential to trigger, in the worst case scenario, a
series of bankruptcies across the supply chain. This risk strongly
increases in periods of economic downturn when access to financing is
particularly difficult. There are signs that this has started to happen
as the current economic crisis unfolds, calling for a strong policy
reaction. 

The Small Business Act [COM(2008)394] highlighted the key importance of
SMEs for the competitiveness of the EU economy and stressed that
effective access to finance was one of the major challenges SMEs have to
face, together with the need to make better use of the opportunities
provided by the Single Market. The European Economic Recovery Plan
[COM(2008) 800] stressed that sufficient and affordable access to
finance was a pre-condition for investment, growth and job creation in
the context of the economic slowdown and asked the EU and the Member
States to ensure that public authorities pay invoices for supplies and
services within one month. 

Late payment by public administrations undermines the credibility of
policies and contradicts declared policy objectives to provide for
stable and predictable operating conditions for enterprises and foster
growth and employment. Given the importance of public procurement in the
EU (more than 1,943 billion euro per year), late payment by public
authorities has a strong negative impact on enterprises, notably SMEs.
Many public authorities do not face the same financing constraints as
businesses and late payment in their case is avoidable. It should
therefore be more severely sanctioned when it occurs. Moreover,
diverging payment attitudes across the EU might hamper business
participation in public tenders, which not only distorts competition and
undermines the functioning of the internal market, but also reduces the
capacity of public authorities to get best value for tax payers' money. 

Accordingly, this proposal aims at improving the cash flow of European
business which is particularly important in times of economic downturn.
It also aims at facilitating the smooth functioning of the internal
market via the elimination of related barriers to cross-border
commercial transactions.

It will achieve this 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.	



120	General context

In the EU, most goods and services are supplied by businesses to other
businesses and to public authorities on a deferred payment basis whereby
the supplier gives the client time to pay. This time period is agreed
between the parties, or set out in the supplier's invoice or laid down
by law. At the latest at the end of this period, the supplier expects
payment for the goods delivered or services rendered. Payment made after
this period constitutes late payment. 

Directive 2000/35/EC was adopted to combat late payment in commercial
transactions between businesses or between businesses and public
authorities. It specifies, inter alia, that statutory interest may be
charged when payment is not made within the contractual or legal
deadline.

There is overwhelming evidence that, despite the entry into force of
Directive 2000/35/EC late payment in commercial transactions is still a
general problem within the EU. In addition, there is also evidence in a
number of Member States of unjustifiably long contractual payment
periods in transactions involving public administrations. Both problems
are a serious impediment to a healthy business environment and to the
functioning of the single market magnified in times of economic
downturn. The roots of late payment in commercial transactions and the
corresponding passive attitude of many creditors are diverse and
interrelated:

1. The market structure: the level of competition within a market, the
market power of market participants and the corresponding fear of
harming commercial relationships with clients are important factors
determining whether creditors accept or refuse late payment and whether
debtors seek an extension of the period of trade credit.

2. Changing macroeconomic conditions: A business cycle downturn is
likely to cause more late payments as firms delay paying their invoices.
The consequences of late payment are also more serious in times of
economic downturn as alternative financing is more difficult to obtain.

3. Access to finance and budgetary constraints: The availability of
credit, monetary policy, the flow and nature of credit information, the
liquidity position of the firm and the availability of financial
resources from banks may also affect late payment, particularly for
businesses for which bank credit is a substitute for supplier financing.
Many debtor enterprises consider late payment an efficient and cheap way
to finance their own businesses and activities. For public authorities,
late payments to creditors are an easy, but unjustified, way to overcome
budgetary constraints by postponing payments to the next budgetary
period.

4. The financial management practice of debtors (including public
authorities) and the credit management practice of creditors as well as
their product and service quality and after-sales service are important
factors in (avoiding) late payment. 

5. The absence of effective and efficient remedies: despite Directive
2000/35/EC, many businesses, in particular SMEs, do not charge interest
when entitled to do so, which in turn decreases the motivation of
debtors to pay in time. For some creditors, the cost of taking action
against late payment is not justified by the financial benefits. In many
cases, the expenses of the extra paperwork cannot be recovered. Chasing
late paying clients or charging interest for late payments generates
administrative costs that many businesses wish to avoid. In addition,
several key provisions of the Directive are unclear or difficult to
implement in practice.

Although Directive 2000/35/EC has some shortcomings, the fundamental
concepts of interest for late payment, the retention of title and
recovery procedures for unchallenged claims constitute essential and
widely accepted pillars of the legal framework combating late payment.
However, despite some recent improvements, late payment remains a
generalized problem in the EU, with public administrations in a number
of Member States displaying particularly bad payment behaviour. This
continues to negatively affect the functioning of the internal market
and risks posing a serious threat to business survival in times of
economic crisis. Therefore, while safeguarding the main elements of the
Directive, it is essential to introduce additional tools to reduce the
number of late payments in commercial transactions, to shorten payment
periods for public administrations and to substantially reinforce the
incentives for public administrations to pay in time by recasting the
Directive, incorporating in a single text both the substantive
amendments made to the Directive and its unchanged provisions. This
proposal would replace and repeal Directive 2000/35/EC. Once adopted by
the legislator, it will naturally be taken into account by the
Commission at the occasion of the forthcoming revision (2010) of the
Financial Regulation and its Implementing Rules.

Meanwhile, as the revision of the financial rules by the legislator is a
long process, the Commission adopted a Communication instructing its
services to implement without delay a set of measures aimed at
streamlining financial rules and accelerating budget implementation to
help economic recovery, in particular through the improvement of its own
payment performance and the setting of targets for reduced payment
time-limits.

130	Existing provisions in the area of the proposal

The only existing provision is Directive 2000/35/EC which would be
recast by this proposal.

140	Consistency with the other policies and objectives of the Union

This proposal is part of the Lisbon Agenda for Growth and Jobs and
implements the Small Business Act [COM(2008)394] and the Commission
Communication on a European Economic Recovery Plan [COM(2008)800].

Consultation of interested parties and impact assessment

	Consultation of interested parties

211	Consultation methods, main sectors targeted and general profile of
respondents

Stakeholders were consulted in a general public consultation through
I.P.M. (Your Voice in Europe). The EBTP (European Business Test Panel)
was also consulted. 

212	Summary of responses and how they have been taken into account

A broad majority of respondents believes that the current statutory rate
laid down in the directive is satisfactory. Most respondents, however,
urged the Commission to put in place effective and efficient remedies in
case of late payment and to strengthen the role of representative
organisations. The responses served as a very important element for the
impact assessment. 

213	An open consultation was conducted over the internet from 19/05/2008
to 31/08/2008. The Commission received 510 response(s). The results are
available on
http://ec.europa.eu/enterprise/regulation/late_payments/index.htm.

	Collection and use of expertise

229	There was no need for external expertise.

230	Impact assessment

The impact assessment and its executive summary give an overview of the
different options. 

Only options 3a/2 (legislative - harmonisation of periods for payment by
public authorities to businesses), 3c (legislative - the abolition of
the €5 threshold), 3d (legislative - the introduction of a "Late
Payment Fee") and 3e (legislative - the introduction of a "Late Payment
Compensation") meet the criteria of effectiveness, efficiency and
consistency. Therefore, these 4 options constitute the basis of this
proposal.

231	The Commission carried out an impact assessment listed in the Work
Programme, whose report is accessible on
http://ec.europa.eu/enterprise/regulation/late_payments/index.htm.

Legal elements of the proposal

305	Summary of the proposed action

This recast of Directive 2000/35/EC aims at improving the effectiveness
and the efficiency of remedies for late payment through the introduction
of an entitlement to the recovery of administrative costs and
compensation for internal costs incurred due to late payment. In the
case of public administrations, the proposal aims at shortening payment
periods through the harmonisation of periods for payment by public
authorities to businesses and at reinforcing disincentives to late
payment by a flat rate compensation from the first day of the delay
amounting to 5% of the invoiced amount in addition to the interest for
late payment and the compensation for recovery costs. Finally, the
proposal also abolishes the possibility to exclude claims for interest
of less than €5.

310	Legal basis

Article 95 EC Treaty.

320	Subsidiarity principle

The subsidiarity principle applies insofar as the proposal does not fall
under the exclusive competence of the Community.

	The objectives of the proposal cannot be sufficiently achieved by the
Member States for the following reason(s).

321	In the absence of Community legislation prior to the implementation
of Directive 2000/35/EC, late payment in commercial transactions was an
important impediment to intra-Community trade.

This is because the absence or ineffectiveness of national rules
combating late payment unfairly protects national economic operators
against products and services coming from other Member States. Failure
by a Member State to prevent obstacles to the free movement of goods or
services originating in other Member States caused by late payment by
national authorities or undertakings is just as damaging to
intra-Community trade as a trade-restrictive act. In addition, diverging
payment attitudes of public authorities across the EU might hamper
business participation in public tenders, which not only distorts
competition and undermines the functioning of the internal market, but
also reduces the capacity of public authorities to get best value for
tax payers' money.

323	Community action will better achieve the objectives of the proposal
for the following reason(s).

	The objective of ensuring the functioning of the internal market by
reducing obstacles to intra-EU trade arising from late payment could not
be sufficiently achieved by Member States or by Directive 2000/35/EC. It
was therefore felt appropriate in accordance with the principle of
subsidiarity, by reason of the scale and effects of the problem, to
achieve this by further action at Community level.

324	Surveys and consultation of stakeholders confirm that the reduction
of late payment in commercial transactions requires EU action through a
recast of Directive 2000/35/EC. The available figures indicate that most
businesses perceive selling goods and services to businesses and
authorities in another Member States as entailing a higher risk of late
payment. Among other reasons, the risk of late payment discourages
enterprises from selling products and services in other Member States
since it increases uncertainty and the cost of doing business. In that
case, transaction costs are higher due to asymmetric information and
insecurity about the market position and the solvency of a client
established outside the domestic market. For many debtors the risk to
reputation related to late payment is much lower when the creditor is
established in another Member State since the damage to reputation
diminishes with distance. Moreover, trade across national borders
amplifies the costs of offering trade credit because language,
jurisdiction and access to solvency data tend to be different and, thus,
monitoring costs increase while the chances of successfully enforcing
payment are lower. As a result, trade credit insurance and other
instruments coping with trade risk management are often used in
cross-border trade. These instruments reduce revenue uncertainty but may
absorb an important fraction of the profit margin, in particular for
small enterprises. 

325	During the impact assessment process, many non-legislative options
were discarded for reasons related to subsidiarity as set out in detail
in the impact assessment.

326	The proposal therefore complies with the subsidiarity principle.

	Proportionality principle

The proposal complies with the proportionality principle for the
following reason(s).

331	The Directive remains an optional instrument for economic operators
in so far as it does not oblige them to claim interest for late payment
or to claim compensation for recovery costs. Moreover, the proposal does
not prevent undertakings from agreeing upon other contractual provisions
regarding payment, including in the case of transactions between
undertakings and in exceptional cases also between public authorities
and undertakings the payment period, in accordance with the fundamental
principle of freedom of contract between economic operators. The
proposal also includes sufficient flexibility to allow Member States to
transpose the Directive in the light of economic and commercial
conditions in their territory. In addition, the proposal does not affect
the existing possibility for Member States to maintain or bring into
force provisions which are more favourable to the creditor than the
provisions necessary to comply with the Directive.

332	This proposal does not lead to any new administrative burden for
economic operators. The financial burden stemming from the new
entitlement to claim reimbursement of recovery costs will be
proportional to businesses' payment behaviour. The budgetary impact for
national authorities will be proportional to their capacity to ensure
compliance with the provisions of the directive.

	Choice of instruments

341	Proposed instruments: directive.

342	Other means would not be adequate for the following reason(s).

Considering that this proposal is a recast of an existing Directive
which provides for a wide margin of manoeuvre for Member States,
alternative options would not have been sufficient to achieve the
proposed objectives

Budgetary implication

401	The budgetary implications are limited to administrative
expenditure.

Additional information

510	Simplification

511	The proposal provides for simplification of legislation.

512	The definitions of essential terms of the Directive are broadened
and regrouped in order to put an end to divergent interpretations.
Ambiguous provisions as regards the rights of creditors are either
deleted or fully redrafted so that economic operators know exactly their
rights under the Directive. A further element of simplification is the
general obligation of transparency introduced for the Member States.
Finally, the vague concept of "recovery costs" is replaced by a new
system consisting of a defined sum for internal recovery costs.

515	The proposal is included in the Commission's rolling programme for
up-date and simplification of the acquis communautaire and its Work and
Legislative Programme under the reference 2009/ENTR/006.

520	Repeal of existing legislation

The adoption of the proposal will lead to the repeal of existing
legislation.

	Review/revision/sunset clause

531	The proposal includes a review clause.

540	Recasting

The proposal involves recasting

550	Correlation table

The Member States are required to communicate to the Commission the text
of national provisions transposing the Directive as well as a
correlation table between those provisions and this Directive.

560	European Economic Area

The proposed act concerns an EEA matter and should therefore extend to
the European Economic Area.

570	Detailed explanation of the proposal

The provisions of Directive 2000/35/EC on its scope (Article 1 of this
proposal), interest in case of late payment (Article 3), the retention
of title (Article 8) and the recovery procedure for unchallenged claims
(Article 9) remain fundamentally unchanged. The various definitions and
concepts are streamlined and brought together in Article 2.

The reasons for the other proposed substantive amendments are the
following:

Article 1(2) removes the possibility that claims for interest of less
than €5 may be excluded by Member States. This will clear a hurdle for
claiming interest for late payments, in particular for SMEs and for late
payment in smaller transactions where interest amounts to only a small
sum.

Article 4 specifies that, in the case of late payment, creditors will be
entitled to obtain a sum for internal recovery costs related to the
amount paid late. The objective is twofold: firstly, the creditor would
be able to recover his internal administrative costs related to late
payment and, secondly, this would have a deterrent effect on debtors,
additional to the statutory interest.

Article 5 of the proposal tackles late payment by public authorities
which will be obliged as a general rule to pay invoices for commercial
transactions leading to the delivery of goods or the provision of
services within 30 days. Past this period, the creditor will in
principle be entitled to compensation of 5% of the amount specified, in
addition to the interest for late payment and the compensation for
recovery costs. The budgetary impact for national authorities will be
proportional to their capacity to ensure compliance with the provisions
of the directive. In addition, the expected improvement in payment
behaviour of public authorities will help reduce the number of business
bankruptcies and thus reduce the social costs that they entail.

Article 6 of the proposal strengthens the provisions about grossly
unfair contractual clauses. It includes a provision whereby a clause
which excludes interest for late payment will always be considered as
grossly unfair.

Article 7 obliges Member States to ensure full transparency about the
rights and obligations stemming from this directive and in particular to
publish the statutory interest rate. This aims at providing in the most
appropriate way practical information to businesses, and especially
SMEs, and will enable them to take action against debtors paying late.

Article 10 lays down the monitoring and evaluation system allowing other
European institutions and stakeholders an insight into the actual
implementation of the Directive.



2009/0054 (COD)

Proposal for a

DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on combating late payment in commercial transactions

(Recast)

(Text with EEA relevance)

  QUOTE "ê"  ê  2000/35/EC

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in
particular Article 95 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Economic and Social
Committee,

Having regard to the opinion of the Committee of the Regions,

Acting in accordance with the procedure laid down in Article 251 of the
Treaty,

Whereas:

  QUOTE "ò"  ò  new

A number of substantive changes are to be made to Directive 2000/35/EC
of the European Parliament and of the Council of 29 June 2000 on
combating late payment in commercial transactions. In the interest of
clarity, that Directive should be recast.

Most goods and services are supplied within the internal market by
economic operators to other economic operators and to public authorities
on a deferred payment basis whereby the supplier gives its client time
to pay the invoice, as agreed between parties, or set out in the
supplier’s invoice or laid down by law.

Many payments in commercial transactions between economic operators or
between economic operators and public authorities are made later than
agreed in the contract or laid down in the general commercial
conditions. Although the goods are delivered or the services performed,
many corresponding invoices are paid well after the deadline. Such late
payment negatively affects liquid assets and complicates the financial
management of enterprises. It also affects their competitiveness and
profitability when the creditor needs to obtain external financing
because of late payment. This risk strongly increases in periods of
economic downturn when access to financing is more difficult

Judicial claims related to late payments are already facilitated by
Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction
and the recognition and enforcement of judgments in civil and commercial
matters, Regulation (EC) No 805/2004 of the European Parliament and of
the Council of 21 April 2004 creating a European Enforcement Order for
uncontested claims, Regulation (EC) No 1896/2006 of the European
Parliament and of the Council of 12 December 2006 creating a European
order for payment procedureand Regulation (EC) No 861/2007 of the
European Parliament and of the Council of 11 July 2007 establishing a
European Small Claims Procedure. However, in order to discourage late
payment in commercial transactions, it is necessary to lay down
complementary provisions.

  QUOTE "ê"  ê  2000/35/EC Recital (1) (adapted)

(1) In its resolution on the integrated programme in favour of SMEs and
the craft sector, the European Parliament urged the Commission to submit
proposals to deal with the problem of late payment.

  QUOTE "ê"  ê  2000/35/EC Recital (2) (adapted)

(2) On 12 May 1995 the Commission adopted a recommendation on payment
periods in commercial transactions.

  QUOTE "ê"  ê  2000/35/EC Recital (3) (adapted)

(3) In its resolution on the Commission recommendation on payment
periods in commercial transactions, the European Parliament called on
the Commission to consider transforming its recommendation into a
proposal for a Council directive to be submitted as soon as possible.

  QUOTE "ê"  ê  2000/35/EC Recital (4) (adapted)

(4) On 29 May 1997 the Economic and Social Committee adopted an opinion
on the Commission's Green Paper on Public procurement in the European
Union: Exploring the way forward.

  QUOTE "ê"  ê  2000/35/EC Recital (5) (adapted)

(5) On 4 June 1997 the Commission published an action plan for the
single market, which underlined that late payment represents an
increasingly serious obstacle for the success of the single market.

  QUOTE "ê"  ê  2000/35/EC Recital (6) (adapted)

(6)	On 17 July 1997 the Commission published a report on late payments
in commercial transactions, summarising the results of an evaluation of
the effects of the Commission's recommendation of 12 May 1995.

  QUOTE "ê"  ê  2000/35/EC Recital (7)

(7) Heavy administrative and financial burdens are placed on businesses,
particularly small and medium-sized ones, as a result of excessive
payment periods and late payment. Moreover, these problems are a major
cause of insolvencies threatening the survival of businesses and result
in numerous job losses.

  QUOTE "ê"  ê  2000/35/EC Recital (8) (adapted)

(8) In some Member States contractual payment periods differ
significantly from the Community average.

  QUOTE "ê"  ê  2000/35/EC Recital (9) (adapted)

(9) The differences between payment rules and practices in the Member
States constitute an obstacle to the proper functioning of the internal
market.

  QUOTE "ê"  ê  2000/35/EC Recital (10) (adapted)

This has the effect of considerably limiting commercial transaction
between Member States. This is in contradiction with Article 14 of the
Treaty as eEntrepreneurs should be able to trade throughout the internal
market under conditions which ensure that transborder operations do not
entail greater risks than domestic sales. Distortions of competition
would ensue if substantially different rules applied to domestic and
transborder operations.

  QUOTE "ê"  ê  2000/35/EC Recital (11) (adapted)

(11)	The most recent statistics indicate that there has been, at best,
no improvement in late payments in many Member States since the adoption
of the recommendation of 12 May 1995.

  QUOTE "ò"  ò  new

In its communication "Think small first" – A "Small Business Act" for
Europe, the Commission emphasized that small and medium-sized
enterprises' (SMEs) access to finance should be facilitated and that a
legal and business environment supportive to timely payments in
commercial transactions should be developed.

One of the priority actions of the "European Economic Recovery Plan" is
the reduction of administrative burdens and the promotion of
entrepreneurship by, inter alia, ensuring that public authorities pay
invoices, including to SMEs, for supplies and services within one month
to ease liquidity constraints.

  QUOTE "ê"  ê  2000/35/EC Recital (12)

The objective of combating late payments in the internal market cannot
be sufficiently achieved by the Member States acting individually and
can, therefore, be better achieved by the Community. This Directive does
not go beyond what is necessary to achieve that objective. This
Directive complies therefore, in its entirety, with the requirements of
the principles of subsidiarity and proportionality as laid down in
Article 5 of the Treaty.

  QUOTE "ê"  ê  2000/35/EC Recital (13) (adapted)

This Directive should be limited to payments made as remuneration for
commercial transactions and does   QUOTE "Ö"  Ö  should   QUOTE "Õ"
 Õ  not regulate transactions with consumers, interest in connection
with other payments, e.g. payments under the laws on cheques and bills
of exchange, payments made as compensation for damages including
payments from insurance companies.

  QUOTE "ê"  ê  2000/35/EC Recital (22)

This Directive should regulate all commercial transactions irrespective
of whether they are carried out between private or public undertakings
or between undertakings and public authorities, having regard to the
fact that the latter handle a considerable volume of payments to
business. It should therefore also regulate all commercial transactions
between main contractors and their suppliers and subcontractors.

  QUOTE "ê"  ê  2000/35/EC Recital (14)

The fact that the liberal professions are covered by this Directive does
not mean that Member States have to treat them as undertakings or
merchants for purposes not covered by this Directive.

  QUOTE "ê"  ê  2000/35/EC Recital (16) (adapted)

  QUOTE "ð"  ð  new

Late payment constitutes a breach of contract which has been made
financially attractive to debtors in most Member States by low   QUOTE
"ð"  ð or no   QUOTE "ï"  ï  interest rates   QUOTE "Ö"  Ö
 charged   QUOTE "Õ"  Õ  on late payments and/or slow procedures for
redress. A decisive shift, including   QUOTE "ð"  ð making the
exclusion of the right to charge interest an unfair contractual clause
and providing for a   QUOTE "ï"  ï  compensation of creditors for the
costs incurred, is necessary to reverse this trend and to ensure that
the consequences of late payments are such as to discourage late
payment.

  QUOTE "ò"  ò  new

In the interest of consistency of Community legislation, the definition
of "contracting authorities" in Directive 2004/18/EC of the European
Parliament and of the Council of 31 March 2004 on the coordination of
procedures for the award of public works contracts, public supply
contracts and public services contracts should apply for the purposes of
this Directive. 

Statutory interest due for late payments should be calculated on a daily
basis as simple interest, in accordance with Regulation (EEC, Euratom)
No 1182/71 of the Council of 3 June 1971 determining the rules
applicable to periods, dates and time limits. 

  QUOTE "ê"  ê  2000/35/EC Recital (17) (adapted)

  QUOTE "ð"  ð  new

  QUOTE "ð"  ð  A fair compensation of creditors for the recovery
costs incurred through late payment is necessary to ensure that the
consequences of late payments are such as to discourage late payment.
Recovery costs should also include the recovery of administrative costs
and compensation for internal costs incurred due to late payment for
which this Directive should determine the possibility of flat-rate
minimum amount which may be cumulated with interest for late payment  
QUOTE "ï"  ï  . The reasonable cCompensation for the recovery costs
has to   QUOTE "Ö"  Ö  should   QUOTE "Õ"  Õ  be considered
without prejudice to national provisions according to which a national
judge can   QUOTE "Ö"  Ö  may   QUOTE "Õ"  Õ  award to the
creditor any additional damage caused by   QUOTE "Ö"  Ö  regarding  
QUOTE "Õ"  Õ  the debtor's late payment, taking also into account that
such incurred costs may be already compensated for by the interest for
late payment.

  QUOTE "ò"  ò  new

Surveys show that public authorities often require contractual payment
periods for commercial transactions that are significantly longer than
30 days. Therefore, payment periods for procurement contracts awarded by
public authorities should be as a general rule limited to a maximum of
30 days.

Late payment is particularly regrettable if it occurs despite the
debtor’s solvency. Surveys show that public authorities often pay
invoices very late after expiration of the applicable payment period.
Public authorities may face lighter financing constraints because they
may benefit from more secure, predictable and continuous revenue streams
than private undertakings. At the same time, they depend less than
private undertakings on building stable commercial relationships for the
achievement of their aims. Consequently, public authorities may have
less incentive to pay on time. In addition, many public authorities can
obtain financing at more attractive conditions than private
undertakings. Therefore, late payment by public authorities not only
leads to unjustified costs for private undertakings, but to inefficiency
in general. It is therefore appropriate to introduce correspondingly
higher dissuasive compensation in case of late payment by public
authorities.

  QUOTE "ê"  ê  2000/35/EC Recital (18)

18) This Directive takes into account the issue of long contractual
payment periods and, in particular, the existence of certain categories
of contracts where a longer payment period in combination with a
restriction of freedom of contract or a higher interest rate can be
justified.

  QUOTE "ê"  ê  2000/35/EC Recital (19) (adapted)

  QUOTE "ð"  ð  new

This Directive should prohibit abuse of freedom of contract to the
disadvantage of the creditor. Where an agreement mainly serves the
purpose of procuring the debtor additional liquidity at the expense of
the creditor   QUOTE "ð"  ð , for example through the exclusion of the
possibility for the creditor to charge interest for late payment or
specifying an interest rate for late payment which is substantially
lower than the statutory interest provided for in this Directive  
QUOTE "ï"  ï  , or where the main contractor imposes on his suppliers
and subcontractors terms of payment which are not justified on the
grounds of the terms granted to himself , these may be considered to be
factors constituting such an abuse. This Directive does   QUOTE "Ö"  Ö
 should   QUOTE "Õ"  Õ  not affect national provisions relating to
the way contracts are concluded or regulating the validity of
contractual terms which are unfair to the debtor.

  QUOTE "ê"  ê  2000/35/EC Recital (21) 

It is desirable to ensure that creditors are in a position to exercise a
retention of title on a non-discriminatory basis throughout the
Community, if the retention of title clause is valid under the
applicable national provisions designated by private international law.

  QUOTE "ê"  ê  2000/35/EC Recital (15)

This Directive only defines the term "enforceable title" but does not
regulate the various procedures of forced execution of such a title and
the conditions under which forced execution of such a title can be
stopped or suspended.

  QUOTE "ê"  ê  2000/35/EC Recital (20)

The consequences of late payment can be dissuasive only if they are
accompanied by procedures for redress which are rapid and effective for
the creditor. In conformity with the principle of non-discrimination
contained in Article 12 of the Treaty, those procedures should be
available to all creditors who are established in the Community.

  QUOTE "ê"  ê  2000/35/EC Recital (23) (adapted)

  QUOTE "ð"  ð  new

  QUOTE "ð"  ð It is necessary to ensure that the recovery procedures
for unchallenged claims related to late payment in commercial
transactions   QUOTE "ï"  ï  Article 5 of this Directive requires that
the recovery procedure for unchallenged claims be completed within a
short period of time in conformity with national legislation, but does
not require Member States to adopt a specific procedure or to amend
their existing legal procedures in a specific way.

  QUOTE "ò"  ò  new

The obligation to transpose this Directive into national law should be
confined to those provisions which represent a substantive change as
compared with Directive 2000/35/EC. The obligation to transpose the
provisions which are unchanged arises under that Directive.

This Directive should be without prejudice to the obligations of the
Member States relating to the time-limits for transposition into
national law and application of Directive 2000/35/EC.

  QUOTE "ê"  ê  2000/35/EC

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Scope

1. This Directive shall apply to all payments made as remuneration for
commercial transactions.

  QUOTE "ê"  ê  2000/35/EC Art. 6(3) (adapted)

32. In transposing this Directive, Member States may exclude   QUOTE
"Ö"  Ö  the following   QUOTE "Õ"  Õ  : 

(a)	debts that are subject to insolvency proceedings instituted against
the debtor; 

(b)	contracts that have been concluded prior to 8 August 2002.; and

(c)	claims for interest of less than EUR 5. 

  QUOTE "ê"  ê  2000/35/EC (adapted)

Article 2

Definitions

For the purposes of this Directive   QUOTE "Ö"  Ö  , the following
definitions shall apply   QUOTE "Õ"  Õ :

1.(1)	"commercial transactions" means transactions between undertakings
or between undertakings and public authorities which lead to the
delivery of goods or the provision of services for remuneration,;

  QUOTE "ê"  ê  2000/35/EC (adapted)

  QUOTE "ð"  ð  new

(2)	"public authority" means any contracting authority or entity , as
defined by the Public Procurement Directives 92/50/EEC, 93/36/EEC,
93/37/EEC and 93/38/EEC   QUOTE "Ö"  Ö  Directive 2004/18/EC   QUOTE
"Õ"  Õ ;

(3)	"undertaking" means any organisation   QUOTE "ð"  ð , other than a
public authority,  QUOTE "ï"  ï  acting in the course of its
independent economic or professional activity, even where it is carried
on by a single person;

2.(4)	"late payment" means exceeding the contractual or statutory period
of payment   QUOTE "ð"  ð  failure to pay within the period of
payment specified in Article 3(2) or Article 5(2)   QUOTE "ï"  ï  ;

  QUOTE "ò"  ò  new

(5)	“interest for late payment” means statutory interest or interest
negotiated and agreed upon between undertakings;

(6)	“statutory interest” means simple interest for late payment at a
rate which is the sum of the reference rate, plus at least seven
percentage points;

(7)	“reference rate” means either of the following:

  QUOTE "ê"  ê  2000/35/EC

  QUOTE "ð"  ð  new

4.(a)	the "interest rate applied by the European Central Bank to its  
QUOTE "ð"  ð  most recent   QUOTE "ï"  ï  main refinancing
operations   QUOTE "ð"  ð  or the marginal interest rate resulting
from variable-rate tender procedures for such operations;   QUOTE "ï" 
ï  " means the interest rate applied to such operations in the case of
fixed-rate tenders. In the event that a main refinancing operation was
conducted according to a variable-rate tender procedure, this interest
rate refers to the marginal interest rate which resulted from that
tender. This applies both in the case of single-rate and variable-rate
auctions;

  QUOTE "ê"  ê  2000/35/EC Art. 3(1)(d) second sentence (adapted)

(b)	For a Member State which is not participating in the third stage of
economic and monetary union, the reference rate referred to above shall
be the equivalent rate set by its national central bank.

  QUOTE "ê"  ê  2000/35/EC 

3.(8)	"retention of title" means the contractual agreement according to
which the seller retains title to the goods in question until the price
has been paid in full; 

  QUOTE "ê"  ê  2000/35/EC (adapted)

  QUOTE "ð"  ð  new

5.(9)	"enforceable title" means any decision, judgment or order for
payment issued by a court or other competent authority,   QUOTE "ð"  ð
 including those that are provisionally enforceable,   QUOTE "ï"  ï 
whether for immediate payment or payment by instalments, which permits
the creditor to have his claim against the debtor collected by means of
forced execution; it shall include a decision, judgment or order for
payment that is provisionally enforceable and remains so even if the
debtor appeals against it.

  QUOTE "ê"  ê  2000/35/EC (adapted)

  QUOTE "ð"  ð  new

Article 3

Interest in case of late payment

(c)1.   QUOTE "Ö"  Ö  Member States shall ensure that   QUOTE "Õ" 
Õ   QUOTE "ð"  ð  in commercial transactions between undertakings, 
 QUOTE "ï"  ï  the creditor shall be is entitled to interest for late
payment   QUOTE "Ö"  Ö  without the necessity of a reminder   QUOTE
"Õ"  Õ  to the extent that   QUOTE "Ö"  Ö  if the following
conditions are satisfied:   QUOTE "Õ"  Õ  

(ia)	  QUOTE "ð"  ð  the creditor   QUOTE "ï"  ï  he has fulfilled
its contractual and legal obligations; and

(iib)	  QUOTE "ð"  ð  the creditor   QUOTE "ï"  ï  he has not
received the amount due on time, unless the debtor is not responsible
for the delay.

12.	  QUOTE "ð"  ð  Where the conditions set out in paragraph 1 are
fulfilled,  QUOTE "ï"  ï  Member States shall ensure that   QUOTE "Ö"
 Ö  the following   QUOTE "Õ"  Õ : 

(a)	interest in accordance with point (d)   QUOTE "ð"  ð  for late
payment   QUOTE "ï"  ï  shall become payable from the day following
the date or the end of the period for payment fixed in the contract;

(b)	if the date or period for payment is not fixed in the contract,
interest   QUOTE "ð"  ð  for late payment   QUOTE "ï"  ï  shall
become payable automatically without the necessity of a reminder   QUOTE
"Ö"  Ö  within any of the following time limits   QUOTE "Õ"  Õ  :

(i)	30 days following the date of receipt by the debtor of the invoice
or an equivalent request for payment; or

(ii)	if the date of the receipt of the invoice or the equivalent request
for payment is uncertain, 30 days after the date of receipt of the goods
or services; or

(iii)(ii)	if the debtor receives the invoice or the equivalent request
for payment earlier than the goods or the services, 30 days after the
receipt of the goods or services; or

(iv)(iii)	if a procedure of acceptance or verification, by which the
conformity of the goods or services with the contract is to be
ascertained, is provided for by statute or in the contract and if the
debtor receives the invoice or the equivalent request for payment
earlier or on the date on which such acceptance or verification takes
place, 30 days after this latter   QUOTE "Ö"  Ö  that   QUOTE "Õ" 
Õ  date.

  QUOTE "ð"  ð  3. Member States shall ensure that the applicable
reference rate:

(a)	for the first semester of the year concerned shall be the rate in
force on 1 January of that year;

(b)	for the second semester of the year concerned shall be the rate in
force on 1 July of that year.   QUOTE "ï"  ï 

  QUOTE "ê"  ê  2000/35/EC (adapted)

(d)	the level of interest for late payment ("the statutory rate"), which
the debtor is obliged to pay, shall be the sum of the interest rate
applied by the European Central Bank to its most recent main refinancing
operation carried out before the first calendar day of the half-year in
question ("the reference rate"), plus at least seven percentage points
("the margin"), unless otherwise specified in the contract. For a Member
State which is not participating in the third stage of economic and
monetary union, the reference rate referred to above shall be the
equivalent rate set by its national central bank. In both cases, the
reference rate in force on the first calendar day of the half-year in
question shall apply for the following six months;

(e)	unless the debtor is not responsible for the delay, the creditor
shall be entitled to claim reasonable compensation from the debtor for
all relevant recovery costs incurred through the latter's late payment.
Such recovery costs shall respect the principles of transparency and
proportionality as regards the debt in question. Member States may,
while respecting the principles referred to above, fix maximum amounts
as regards the recovery costs for different levels of debt.

2. For certain categories of contracts to be defined by national law,
Member States may fix the period after which interest becomes payable to
a maximum of 60 days provided that they either restrain the parties to
the contract from exceeding this period or fix a mandatory interest rate
that substantially exceeds the statutory rate.

3. Member States shall provide that an agreement on the date for payment
or on the consequences of late payment which is not in line with the
provisions of paragraphs 1(b) to (d) and 2 either shall not be
enforceable or shall give rise to a claim for damages if, when all
circumstances of the case, including good commercial practice and the
nature of the product, are considered, it is grossly unfair to the
creditor. In determining whether an agreement is grossly unfair to the
creditor, it will be taken, inter alia, into account whether the debtor
has any objective reason to deviate from the provisions of paragraphs
1(b) to (d) and 2. If such an agreement is determined to be grossly
unfair, the statutory terms will apply, unless the national courts
determine different conditions which are fair.

4. Member States shall ensure that, in the interests of creditors and of
competitors, adequate and effective means exist to prevent the continued
use of terms which are grossly unfair within the meaning of paragraph 3.


5. The means referred to in paragraph 4 shall include provisions whereby
organisations officially recognised as, or having a legitimate interest
in, representing small and medium-sized enterprises may take action
according to the national law concerned before the courts or before
competent administrative bodies on the grounds that contractual terms
drawn up for general use are grossly unfair within the meaning of
paragraph 3, so that they can apply appropriate and effective means to
prevent the continued use of such terms.

  QUOTE "ò"  ò  new

Article 4

Compensation for recovery costs 

1. Member States shall ensure that, when interest for late payment
becomes payable in commercial transactions in accordance with Articles 3
and 5 and unless otherwise specified in the contract, the creditor is
entitled to obtain from the debtor any of the following amounts: 

(a)	for a debt of less than EUR 1 000, a fixed sum of EUR 40;

(b)	for a debt of EUR 1 000 or more, but less than EUR 10 000, a fixed
sum of EUR 70;

(c)	for a debt of EUR 10 000 or more, a sum equivalent to 1% of the
amount for which interest for late payment becomes payable.

2. Member States shall ensure that the amounts referred to in paragraph
1 shall be payable without the necessity of a reminder and as
compensation for the creditor's own recovery costs.

  QUOTE "ê"  ê  2000/35/EC Art. 3(1)(e) (adapted)

  QUOTE "ð"  ð  new

(e) 3. Uunless the debtor is not responsible for the delay, the creditor
shall   QUOTE "ð"  ð  , in addition to the amounts set out in
paragraph 1,   QUOTE "ï"  ï  be entitled to obtain reasonable
compensation from the debtor for all relevant   QUOTE "ð"  ð
 remaining   QUOTE "ï"  ï  recovery costs incurred through the
latter's late payment. Such recovery costs shall respect the principles
of transparency and proportionality as regards the debt in question.
Member States may, while respecting the principles referred to above,
fix maximum amounts as regards the recovery costs for different levels
of debt.

  QUOTE "ò"  ò  new

Article 5

Payment by public authorities

1. Member States shall ensure that, in commercial transactions leading
to the delivery of goods or the provision of services for remuneration
to public authorities, the creditor is entitled, without the necessity
of a reminder, to interest for late payment equal to statutory interest
if the following conditions are satisfied: 

(a)	the creditor has fulfilled its contractual and legal obligations; 

(b)	the creditor has not received the amount due on time, unless the
debtor is not responsible for the delay.

2.	Where the conditions set out in paragraph 1 are fulfilled, Member
States shall ensure the following:

(a)	interest for late payment shall become payable from the day
following the date or the end of the period for payment fixed in the
contract;

(b)	if the date or period for payment is not fixed in the contract,
interest for late payment shall become payable automatically within any
of the following time limits:

(i)	30 days following the date of receipt by the debtor of the invoice
or an equivalent request for payment; 

(ii)	if the debtor receives the invoice or the equivalent request for
payment earlier than the goods or the services, 30 days after the
receipt of the goods or services;

(iii)	if a procedure of acceptance or verification, by which the
conformity of the goods or services with the contract is to be
ascertained, is provided for by statute or in the contract and if the
debtor receives the invoice or the equivalent request for payment
earlier or on the date on which such acceptance or verification takes
place, 30 days after that date.

3. Member States shall ensure that the maximum duration of a procedure
of acceptance or verification referred to in paragraph 2(b)(iii) shall
not exceed 30 days, unless otherwise specified and duly justified in the
tender documents and the contract.

4. Member States shall ensure that the period for payment fixed in the
contract shall not exceed the time limits provided for in paragraph
2(b), unless it is specifically agreed between the debtor and the
creditor and is duly justified in the light of particular circumstances
such as an objective need to schedule payment over a longer period.

5. Member States shall ensure that when interest for late payment
becomes payable, the creditor is entitled to a lump sum compensation
equal to 5% of the amount due. This compensation shall be additional to
the interest for late payment.

6. Member States shall ensure that the applicable reference rate in
commercial transactions leading to the delivery of goods or the
provision of services for remuneration to public authorities:

(a)	for the first semester of the year concerned shall be the rate in
force on 1 January of that year;

(b)	for the second semester of the year concerned shall be the rate in
force on 1 July of that year. 

  QUOTE "ê"  ê  2000/35/EC (adapted)

Article 6

  QUOTE "Ö"  Ö  Grossly unfair contractual clauses   QUOTE "Õ"  Õ  

  QUOTE "ê"  ê  2000/35/EC Art. 3(3), (4) and (5) (adapted)

  QUOTE "ð"  ð  new

31. Member States shall provide that an agreement   QUOTE "ð"  ð  a
clause in a contract   QUOTE "ï"  ï  on   QUOTE "Ö"  Ö  relating to
  QUOTE "Õ"  Õ  the date for payment or   QUOTE "ð"  ð , the rate of
interest for late payment or recovery costs   QUOTE "ï"  ï  on the
consequences of late payment which is not in line with the provisions of
paragraphs 1(b) to (d) and (2) either shall not   QUOTE "ð"  ð
 either   QUOTE "ï"  ï  be enforceable   QUOTE "ð"  ð
 unenforceable   QUOTE "ï"  ï  or shall give rise to a claim for
damages if , when all circumstances of the case, including good
commercial practice and the nature of the product, are considered it is
grossly unfair to the creditor. In determining whether   QUOTE "ð"  ð
 a clause   QUOTE "ï"  ï  an agreement is grossly unfair to the
creditor,   QUOTE "Ö"  Ö  all circumstances of the case shall be
considered, including good commercial practice and the nature of the
product   QUOTE "Õ"  Õ    QUOTE "ð"  ð  or the service.   QUOTE
"ï"  ï  it will   QUOTE "Ö"  Ö  Account shall   QUOTE "Õ"  Õ   
QUOTE "ð"  ð  also   QUOTE "ï"  ï  be taken , inter alia,   QUOTE
"Ö"  Ö  of   QUOTE "Õ"  Õ  into account whether the debtor has any
objective reason to deviate from the provisions of paragraphs 1(b) to
(d) and 2   QUOTE "ð"  ð  the statutory rate of interest or from
Article 3(2)(b), Article 4(1) or Article 5(2)(b)   QUOTE "ï"  ï . If
such an agreement is determined to be grossly unfair, the statutory
terms will apply, unless the national courts determine different
conditions which are fair.

  QUOTE "ð"  ð  For the purpose of the first subparagraph, a clause
which excludes interest for late payment shall always be considered as
grossly unfair.   QUOTE "ï"  ï 

42. Member States shall ensure that, in the interests of creditors and
competitors, adequate and effective means exist to prevent the continued
use of terms   QUOTE "ð"  ð  clauses   QUOTE "ï"  ï  and practices
which are grossly unfair to the creditor within the meaning of paragraph
31. 

53. The means referred to in paragraph 42 shall include provisions
whereby   QUOTE "ð"  ð  representative   QUOTE "ï"  ï 
organisations officially recognised as, or having a legitimate interest
in, representing small and medium-sized enterprises may take action
according to the national law concerned before the courts or before
competent administrative bodies on the grounds that contractual terms
drawn up for general use   QUOTE "ð"  ð  clauses   QUOTE "ï"  ï 
are grossly unfair within the meaning of paragraph 3, so that they can
apply appropriate and effective means to prevent the   QUOTE "ð"  ð
 their   QUOTE "ï"  ï  continued use of such terms. 

  QUOTE "ò"  ò  new

Article 7

Transparency 

Member States shall ensure full transparency about the rights and
obligations stemming from this Directive, in particular by publishing
the applicable statutory interest rate.

  QUOTE "ê"  ê  2000/35/EC

Article 48

Retention of title

1. Member States shall provide in conformity with the applicable
national provisions designated by private international law that the
seller retains title to goods until they are fully paid for if a
retention of title clause has been expressly agreed between the buyer
and the seller before the delivery of the goods. 

2. Member States may adopt or retain provisions dealing with down
payments already made by the debtor.

  QUOTE "ê"  ê  2000/35/EC (adapted)

  QUOTE "ð"  ð  new

Article 59 

Recovery procedures for unchallenged claims

1. Member States shall ensure that an enforceable title can be obtained,
irrespective of the amount of the debt, normally within 90 calendar days
of the lodging of the creditor's action or application at the court or
other competent authority, provided that the debt or aspects of the
procedure are not disputed. This duty shall be carried out by Member
States in conformity with their respective national legislation,
regulations and administrative provisions. 

2. The respective nNational legislation, regulations and administrative
provisions shall apply the same conditions for all creditors who are
established in the European Community.

3. The 90 calendar day period referred to in paragraph 1 shall not
include the following   QUOTE "Ö"  Ö  When calculating the period
referred to in paragraph 1, the following shall not be taken into
account   QUOTE "Õ"  Õ :

(a)	periods for service of documents;

(b)	any delays caused by the creditor, such as periods devoted to
correcting applications.

4. This Article shall be without prejudice to the provisions of the
Brussels Convention on jurisdiction and enforcement of judgments in
civil and commercial matters 

  QUOTE "ð"  ð  4. Paragraphs 1, 2 and 3 shall be without prejudice
to the provisions of Regulation (EC) 1986/2006.   QUOTE "ï"  ï 

  QUOTE "ò"  ò  new

Article 10

Report

1. Member States shall send a report to the Commission on the
implementation of this Directive within two years after the date
referred to in Article 11(1) and subsequently at three-year intervals. 

2. Within three years after the date referred to in Article 11(1), the
Commission shall submit a report to the European Parliament and the
Council on the implementation of this Directive. The report shall be
accompanied by any appropriate proposals. 

  QUOTE "ê"  ê  2000/35/EC (adapted)

Article 611

Transposition

1. Member States shall bring into force the laws, regulations and
administrative provisions necessary to comply with this Directive before
8 August 2002. They shall forthwith inform the Commission thereof.

When Member States adopt these measures, they shall contain a reference
to this Directive or shall be accompanied by such reference on the
occasion of their official publication. The methods of making such
reference shall be laid down by Member States.

  QUOTE "ê"  ê  . (adapted)

1. Member States shall bring into force the laws, regulations and
administrative provisions necessary to comply with Articles 1 to 7 and 9
by [last day of the 12th month following publication of this Directive
in the Official Journal of the European Union] at the latest. They shall
forthwith communicate to the Commission the text of those provisions and
a correlation table between those provisions and this Directive.

When Member States adopt those provisions, they shall contain a
reference to this Directive or be accompanied by such a reference on the
occasion of their official publication. They shall also include a
statement that references in existing laws, regulations and
administrative provisions to the directive repealed by this Directive
shall be construed as references to this Directive. Member States shall
determine how such reference is to be made and how that statement is to
be formulated.

  QUOTE "ê"  ê  2000/35/EC (adapted)

  QUOTE "ð"  ð  new

42. Member States shall communicate to the Commission the text of the
main provisions of national law which they adopt in the field covered by
this Directive.

23. Member States may maintain or bring into force provisions which are
more favourable to the creditor than the provisions necessary to comply
with this Directive.

4. In transposing the Directive, Member States may exclude contracts  
QUOTE "ð"  ð  concluded prior to the date specified in paragraph 1. 
 QUOTE "ï"  ï 

3. In transposing this Directive, Member States may exclude:

(a)	debts that are subject to insolvency proceedings instituted against
the debtor;

(b)	contracts that have been concluded prior to 8 August 2002; and

(c)	claims for interest of less than EUR 5.

4. Member States shall communicate to the Commission the text of the
main provisions of national law which they adopt in the field covered by
this Directive.

5. The Commission shall undertake two years after 8 August 2002 a review
of, inter alia, the statutory rate, contractual payment periods and late
payments, to assess the impact on commercial transactions and the
operation of the legislation in practice. The results of this review and
of other reviews will be made known to the European Parliament and the
Council, accompanied where appropriate by proposals for improvement of
this Directive.

  QUOTE "ò"  ò  new

Article 12

Repeal

Save as regards contracts concluded before [the date set out in Article
11(1)] to which this Directive does not apply pursuant to Article 11(4),
Directive 2000/35/EC is repealed with effect from that date, without
prejudice to the obligations of the Member States relating to the
time-limit for its transposition into national law and its application. 

References to the repealed Directive shall be construed as references to
this Directive and shall be read in accordance with the correlation
table in the Annex.

  QUOTE "ê"  ê  2000/35/EC

  QUOTE "ð"  ð  new

Article 713

Entry into force

This Directive shall enter into force on the [twentieth] day following
that of its publication in the Official Journal of the European Union.

  QUOTE "ê"  ê  2000/35/EC

Article 814

Addressees

This Directive is addressed to the Member States.

Done at Brussels, […]

For the European Parliament	For the Council

The President	The President

[…]	[…]

ANNEX 

Correlation table

Directive 2000/35/EC	This Directive

Article 1	Article 1(1)

Article 2(1) first subparagraph	Article 2(1)

Article 2(1) second subparagraph	Article 2(2)

Article 2(1) third subparagraph	Article 2(3)

Article 2(2)	Article 2(4)

-	Article 2(5)

-	Article 2(6)

-	Article 2(7), introductory words

Article 2(3)	Article 2(8)

Article 2(4)	Article 2(7)(a)

Article 2(5)	Article 2(9)

Article 3(1)(a)	Article 3(2)(a)

Article 3(1)(b), introductory words	Article 3(2)(b)

Article 3(1)(b)(i)	Article 3(2)(b)(i)

Article 3(1)(b)(ii)	-

Article 3(1)(b)(iii)	Article 3(2)(b)(ii)

Article 3(1)(b)(iv)	Article 3(2)(b)(iii)

Article 3(1)(c)	Article 3(1)

Article 3(1)(d), first and third sentences	-

Article 3(1)(d), second sentence	Article 2(7)(b)

-	Article 4(1)

-	Article 4(2)

Article 3(1)(e)	Article 4(3)

Article 3(2)	-

-	Article 5

Article 3(3), first and second sentences	Article 6(1), first
subparagraph 

Article 3(3), third sentence	-

-	Article 6(1), second subparagraph 

Article 3(4)	Article 6(2)

Article 3(5)	Article 6(3)

-	Article 7

Article 4	Article 8

Article 5(1), (2) and (3)	Article 9(1), (2) and (3)

Article 5(4) 	-

-	Article 5(4)

-	Article 10

Article 6(1) 	-

-	Article 11(1)

Article 6(2)	Article 11(3)

Article 6(3)	Article 1(2)

Article 6(4)	Article 11(2)

Article 6(5)	-

-	Article 11(4)

-	Article 12

Article 7	Article 13

Article 8	Article 14

-	Annex

LEGISLATIVE FINANCIAL STATEMENT

1.	NAME OF THE PROPOSAL

Proposal for a Directive of the European Parliament and of the Council
on combating late payment in commercial transactions (recast).

2.	ABM / ABB FRAMEWORK

Title 02 – Enterprise – Chapter 02 03 Internal market for goods and
sectoral policies. 

3.	BUDGET LINES

3.1.	Budget lines (operational lines and related technical and
administrative assistance lines (ex- B..A lines)) including headings:

02.0301

3.2.	Duration of the action and of the financial impact:

Considering that the action is a legislative proposal, its duration is
undetermined. 

3.3.	Budgetary characteristics:

Budget line	Type of expenditure	New	EFTA contribution	Contributions from
applicant countries	Heading in financial perspective

02.0301	Non-comp	Diff	 NO	YES	NO	 1a

4.	SUMMARY OF RESOURCES

4.1.	Financial Resources 

4.1.1.	Summary of commitment appropriations (CA) and payment
appropriations (PA)

EUR million (to 3 decimal places)

Expenditure type	Section no.

2010	2011	2012	2013	2014	2015 and later	

Total

Operational expenditure









Commitment Appropriations (CA)	8.1.	a	0	0	0	0	0	0	0

Payment Appropriations (PA)

b	0	0	0	0	0	0	0

Administrative expenditure within reference amount





Technical & administrative assistance (NDA)	8.2.4.	c	0	0	0	0	0.3	0	0.3

TOTAL REFERENCE AMOUNT







	Commitment Appropriations

a+c	0	0	0	0	0.3	0	0.3

Payment Appropriations

b+c	0	0	0	0	0.3	0	0.3

Administrative expenditure not included in reference amount



Human resources and associated expenditure (NDA)	8.2.5.	d	0.244	0.244
0.244	0.244	0.244	0.244	1.464

Administrative costs, other than human resources and associated costs,
not included in reference amount (NDA)	8.2.6.	e	0.1	0.1	0.1	0.1	0.1	0.1
0.6

Total indicative financial cost of intervention

TOTAL CA including cost of Human Resources

a+c+d+e	0.344	0.344	0.344	0.344	0.644	0.344	2.364

TOTAL PA including cost of Human Resources

b+c+d+e	0.344	0.344	0.344	0.344	0.644	0.344	2.364

4.1.2.	Compatibility with Financial Programming

The proposal is compatible with existing financial programming.

4.1.3.	Financial impact on Revenue

The proposal has no financial implications on revenue.

4.2.	Human Resources FTE (including officials, temporary and external
staff) – see detail under point 8.2.1. 

Annual requirements	2010	2011	2012	2013	2014	2015 and later

Total number of human resources	2	2	2	2	2	2

5.	CHARACTERISTICS AND OBJECTIVES

5.1.	Need to be met in the short or long term

See the Explanatory Memorandum.

5.2.	Value-added of Community involvement and coherence of the proposal
with other financial instruments and possible synergy

See the Explanatory Memorandum.

5.3.	Objectives, expected results and related indicators of the proposal
in the context of the ABM framework

See the Explanatory Memorandum.

5.4.	Method of Implementation (indicative)

Centralised Management: directly by the Commission.

6.	MONITORING AND EVALUATION

The organisation of a reliable monitoring and evaluation scheme is
complicated by the principle that the rules laid down in this proposal
do not have a compulsory effect on businesses, i.e. businesses will not
be obliged to apply these rules and to claim their rights. In addition,
evidence suggests that a negative economic cycle is likely to negatively
influence timely payment as it affects companies’ cash flows and
funding opportunities. During a period of economic growth, enterprises
benefit from better cash inflow which, at least partly, can be used for
paying more promptly. 

The monitoring system consists of 2 pillars:

Transparency: the proposal obliges the Member States to ensure full
transparency about the rights and obligations stemming from this
Directive.

Reporting: the proposal obliges Member States to send a report to the
Commission on their implementation of the Directive at three-year
intervals. The Commission shall gather this information and then draft a
report on the implementation of this Directive. This report will
probably be drafted, inter alia, by reference to the information and
data set out in annexes 1, 2 and 3 (partly) of the Impact Assessment
which will be used as complementary indicators for the achievement of
the objectives. The organisation of new, similar surveys will enable the
Commission to compare the behaviour of creditors before and after
implementation of the Directive.

7.	Anti-fraud measures 

Not applicable.

8.	DETAILS OF RESOURCES

8.1.	Objectives of the proposal in terms of their financial cost

Not applicable. 

8.2.	Administrative Expenditure

8.2.1.	Number and type of human resources

Types of post

Staff to be assigned to management of the action using existing and/or
additional resources (number of posts/FTEs)



2010	2011	2012	2013	2014	2015

Officials or temporary staff (XX 01 01)	A*/AD	1	1	1	1	1	1

	B*, C*/AST	1	1	1	1	1	1

Staff financed by art. XX 01 02	0	0	0	0	0	0

Other staff financed by art. XX 01 04/05	0	0	0	0	0	0

TOTAL	2	2	2	2	2	2

8.2.2.	Description of tasks deriving from the action

The tasks consist of the administrative management of the Directive,
including the handling of complaints and infringements, the
implementation of the transparency measures and the preparation and
drafting of the report referred to under point 6.

8.2.3.	Sources of human resources (statutory)

Posts to be redeployed using existing resources within the managing
service (internal redeployment)

8.2.4.	Other Administrative expenditure included in the reference amount
(XX 01 04/05 – Expenditure on administrative management)

EUR million (to 3 decimal places)

Budget line

(number and heading)	2010	2011	2012	2013	2014	2015 and later	TOTAL

1 Technical and administrative assistance (including related staff
costs)







	Executive agencies	0	0	0	0	0	0	0

Other technical and administrative assistance







		- intra muros 	0	0	0	0	0	0	0

	- extra muros	0	0	0	0	0.3	0	0

Total Technical and administrative assistance	0	0	0	0	0.3	0	0

8.2.5.	Financial cost of human resources and associated costs not
included in the reference amount

EUR million (to 3 decimal places)

Type of human resources	2010	2011	2012	2013	2014	2015 and later

Officials and temporary staff (XX 01 01)	0.244	0.244	0.244	0.244	0.244
0.244

Staff financed by Art XX 01 02 (auxiliary, END, contract staff, etc.)

(specify budget line)	0	0	0	0	0	0

Total cost of Human Resources and associated costs (NOT in reference
amount)	0.244	0.244	0.244	0.244	0.244	0.244



8.2.6. Other administrative expenditure not included in the reference
amount

EUR million (to 3 decimal places)

	2010	2011	2012	2013	2014	2015 and later	TOTAL

XX 01 02 11 01 – Missions	0.05	0.05	0.05	0.05	0.05	0.05	0.3

XX 01 02 11 02 – Meetings & Conferences	0.05	0.05	0.05	0.05	0.05	0.05
0.3

XX 01 02 11 03 – Committees 	0	0	0	0	0	0	0

XX 01 02 11 04 – Studies & consultations	0	0	0	0	0	0	0

XX 01 02 11 05 - Information systems	0	0	0	0	0	0	0

2 Total Other Management Expenditure (XX 01 02 11)	0.1	0.1	0.1	0.1	0.1
0.1	0.6

3 Other expenditure of an administrative nature (specify including
reference to budget line)	0	0	0	0	0	0	0

Total Administrative expenditure, other than human resources and
associated costs (NOT included in reference amount)	0.1	0.1	0.1	0.1	0.1
0.1	0.6



	SEC(2009)477final of 8 April 2009.

	OJ C […], […], p. […].

	OJ C […], […], p. […].

	OJ C […], […], p. […].

	OJ L 200, 8.8.2000, p. 35.

	OJ L 12, 16.1.2001, p. 1.

	OJ L 143, 30.4.2004, p. 15.

	OJ L 399, 30.12.2006, p.1.

	OJ L 199, 31.7.2007, p.1.

	OJ C323, 21.11.1994, p. 19.

	OJ L127, 10.6.1995, p. 19.

	OJ C211, 22.7.1996, p. 43.

	OJ C287, 22.9.1997, p. 92.

	OJ C216, 17.7.1997, p. 10.

	COM(2008)394.

	COM(2008)800. 

	OJ L 134, 30.4.2004, p. 114.

	OJ L 124, 8.6.1971, p. 1.

	OJ L 209, 24.7.1992, p. 1.

	OJ L 199, 9.8.1993, p. 1.

	OJ L 199, 9.8.1993, p. 54. 

	OJ L 199, 9.8.1993, p. 84.

	Consolidated version in OJ C 27, 26.1.1998, p. 3.

	Differentiated appropriations

	Expenditure that does not fall under Chapter xx 01 of the Title xx
concerned.

	Expenditure within article xx 01 04 of Title xx.

	Expenditure within chapter xx 01 other than articles xx 01 04 or xx 01
05.

	Cost of which is NOT covered by the reference amount

	Cost of which is NOT covered by the reference amount

	Cost of which is included within the reference amount

	Reference should be made to the specific legislative financial
statement for the Executive Agency(ies) concerned.

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