Subject: Compliance with the Late Payment Directive and companies receiving Next Generation EU Funds in Spain
According to the organisation Plataforma Multisectorial contra la Morosidad, in Spain half a million companies are at risk of bankruptcy mainly due to late payments1.
According to data from the Spanish National Securities Market Commission, in the first half of 2020 the late payment in commercial transactions of IBEX 35 companies was EUR 56 488 million euros2. The average payment term of these companies in 2020 was 193 days, when the legal term is in fact 60 days. In 2019, these companies had an average payment term of 183 days.
In its sentence STS 668/2016 of 14 November 2016, the Spanish Supreme Court declared null and void all agreements that allowed for payments to be made over the 60-day threshold. However, large companies continue to breach the Late Payment Directive. Given that the directive does not provide for a sanctioning regime, it is possible that many of these companies may receive European funds, leaving out of fair competition solvent SMEs that comply with all EU regulations.
Does the Commission believe that complying with the Late Payment Directive should be a condition for companies to receive Next Generation EU Funds?
1 The average payment term for IBEX companies was 193 days in the first half of 2020, which is three times
the number of days provided for by law – La República (larepublica.cat) 2 Jointly, EUR 56 488 million in commercial transactions were paid late by IBEX companies – Diari de Girona
Answer given by Mr Breton on behalf of the European Commission
(29 June 2021)
Complying with the Late Payment Directive (3) is an obligation for the Member States, regardless of any past, present or future EU Funds granted to them.
Paying businesses on time is vital for the economy. This holds true for both commercial transactions between public authorities and undertakings, and commercial transactions between undertakings (4).
Prompt payment helps building resilience, rekindles recovery and enables the successful digital and sustainable transition of businesses. This is why the Commission, as announced in its ‘SME (5) strategy’ (6) and ‘Updated Industrial Strategy’ (7), is working to support the Member States in enforcing the Late Payment Directive more effectively. The Commission is also working to monitor late payments through an EU Observatory and establish synergies between procurement procedures and payment obligations for public authorities.
In this context, the Commission has adopted on 16 June 2021 a positive assessment of Spain's Recovery and Resilience Plan which envisages the implementation of measures to improve the effectiveness of the implementation of Directive 2011/7/EU on combating late payment in commercial transactions between businesses (8).
⋅1∙ The average payment term for IBEX companies was 193 days in the first half of 2020, which is three times the number of days provided for by law — La República
(larepublica.cat)
⋅2∙ Jointly, EUR 56 488 million in commercial transactions were paid late by IBEX companies — Diari de Girona
⋅3∙ Directive 2011/7/EU of the European Parliament and of the Council of 16 February 2011 on combating late payment in commercial transactions, OJ L 48,
23.2.2011, p. 1‐10
⋅4∙ See Article 3 of the directive
⋅5∙ Small and medium-sized enterprises
⋅6∙ COM (2020) 103
⋅7∙ COM (2021) 350
⋅8∙ See page 15 of the Spanish Resilience and Recovery Plan: https://www.lamoncloa.gob.es/temas/fondos-recuperacion/Documents/05052021-Componente13.pdf