In March of this year the European Communities (Late Payments in Commercial Transactions) Regulations 2012 came into effect. The new law applies to commercial transactions in both the public and private sectors. The main points in the new law are as follows;
1. Interest is payable on late payments in commercial contracts
2. The standard term for the payment of invoices is 30 days but under the new law this period can be extended to 60 days with the agreement of both parties;
3. The interest clause is implied in the contract which means that it does not have to be written into the contract; and
4. The rate of interest chargeable for late payment is the European Central Bank main refinancing rate plus 8 percentage points unless otherwise agreed between the parties.
For more information please contact James Seymour at jamesseymour@berwick.ie.
