Lib Dem MEPs for Yorkshire are backing new measures that will help businesses in the area who do work for public bodies. The impact of unpaid invoices to the region’s small and medium sized businesses (SMEs) can be crippling, in extreme cases forcing some small businesses into bankruptcy as their invoices are not paid.
Thanks to the work of the European Parliament, from 16 March 2013 public authorities will be obliged to pay for goods and services within 30 days, or, in very exceptional circumstances, within 60 days and the interest rate in case of non-compliance will be at least 8%. Businesses should pay their invoices within 60 days unless they expressly agree otherwise and if it not grossly unfair to the creditor.
The region’s Liberal Democrat MEPs, Edward McMillan Scott and Rebecca Taylor have welcomed the move.
Edward McMillan-Scott MEP said:
“As we encourage our region’s small businesses to expand it is vital that they are protected from shoddy practices around the EU, including the late payment of invoices. This is about making paying bills on time the norm for all.”
Rebecca Taylor MEP added:
“I have met with business leaders from around the region, including representatives of the Federation of Small Businesses, and I heard from them how important the issue of cash flow is for small businesses. This is the right step for businesses here in the region.”
- These new regulations come in under Directive 2011/7/EU
- Information about how they apply in the UK can be found here: https://www.gov.uk/government/consultations/consultation-on-implementing-directive-2011-7-eu-on-combating-late-payment-in-commercial-transactions