Changes to payment deadlines for the purchase of goods and services are looking increasingly likely as the European Parliament and European Council reach agreement over important amendments to the existing European Directive.
The agreed changes will mean that there is a standard 30-day deadline for payments for both public authorities and business-to-business transactions. In exceptional circumstances, it has been agreed that public authorities can, with special justification, seek to extend this payment period, but only for up to a further 30 days.
The European Parliament and Council have also agreed that by way of exception, Member States may choose a deadline of up to 60 days for public entities providing healthcare. If the UK Government chooses to take advantage of this, it will mean that NHS bodies will be able to contract on the basis of 60-day payment periods, without having to provide special justification on each occasion that they seek to do so.
Agreement was also reached for a 30-day verification period within which buyers must check that goods and services comply with the contract terms. This period may be extended only if expressly agreed and provided it is not grossly unfair to the creditor.
The agreement now needs to be approved by the full European Parliament and is likely to be put to a plenary vote in October.
An implementation date is unclear at present, so watch this space for updates on these changes.