SEMINAR ON LATE PAYMENT DIRECTIVE

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SEMINAR ON LATE PAYMENT DIRECTIVE

• Pilar Perales Viscasillas
• University of La Rioja, Spain

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Examples of country application on the
transposition of Directive 2000/35/CE

• A disclaimer clause
• 27 Member States have incorporated the Directive
• October 2006 -Review of the effectiviness of
  European Community Legislation on combating late
  payments.
• Divergencies in member States in the
  transposition of the Directive.

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Ways to implement the Directive

• Special Law Belgium, Spain, Cyprus, Greece,
  Italy, Lithuania, Luxembourg.
• Merging the Directive with the preexisting
  domestic Law (CC/Cco/Law of Obligations)France,
  Portugal, Czech Republic, France, Hungary,
  Latvia, Romania, Slovak Republic, Sweden. Law of
  obligations Bulgaria and Estonia. Malta
  (Business Promotion Act).
• General law related to interests Denmark,
  Finnland, Ireland, UK, and Scotland
• Germany complete reform of the BGB

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Scope of the Directive

• Type of contracts to be included
• Directive 2000/35 does not specify the kind or
  type of contracts to be included.
• Exceptionally, Malta sale of goods, service
  contracts, lease, work contracts, and loan
  contracts
• Lithuania also includes work contracts.
• Court of Appeal in France, 26 October 2006
  contract between professionals are excluded.
• Sale or lease of real state (Malta).
• English text (goods/product) French text
  (marchandises/biens) Spanish (bien/mercancías).
  Also the fact that in Malta loan contracts are
  included mean that transactions on money are also
  covered.

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EXCLUSIONS

• Consumir transactionsincluded in Germany,
  Finnland and Luxembourg.
• Payments under bill of exchange and cheques
  Spain/Lituania/Portugal.
• Payment made as compensation for damages,
  including payments from insurance companies
  Italy, Spain, Portugal, Luxembourg, Lituania. But
  included in Finnland.
• Debts that are subject to insolvency proceeding
  instituted against the debtor Italy/Spain/Poland/
  Lituania/Luxemburg. Belgium has established the
  primary application of the insolvency regime.
• Claims for interest of less than EUR 5 Ireland,
  Italy
• Other exclusions
• In Poland, financial contracts are excluded, as
  well as sale of goods or services contracts which
  are financed by international institutions in
  which Poland is a member.
• Luxembourg it does not apply the law to a
  contract concluded between to public authorities.
  

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Substantive provisions Interests

• Date in which the interests become payable dies
  a quo. Most legislators follows literally art.3.1
  b) Directive. However, some States provide for
  more favourable provisions for the creditor
  Finnland/UK/Denmark.
• Automatic accrual of interests In Ireland,
  Article 4.3 of the Irish transposition law
  provides for an automatic entitlement to interest
  rather than an automatic payment of interest. In
  practice this has meant that the interest is only
  paid when imposed pursuant to a court decision.

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Interest rate

• Rate of interests In Lithuania VILIBOR7
  (Interbank interest for loan among banks).
  Usually the States opt for the 7 percentage
  points, except for Hungary, Malta and Germany 8
  . Also in Germany if it is a consumer the
  percentage is 5.
• For the 7 percentage opt Spain, Belgium,
  France, Finnland,Ireland,Italy,Estonia
  Lithuania,Portugal,Luxembourg.

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PERIOD OF PAYMENT

• 30 days. Breach of a fundamental rule in
  bilateral or synallagmatic contracts, but not in
  Austria section1334 CC Unless otherwise agreed
  by the parties, the debtor shall effect his
  performance without any undue delay after the
  performance of the creditor.
• Art.3.2 Directive 60 days Italy, Spain, France
  and Portugal. Spain breach of the Directive

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Arts.3.3/3.4 Directive control of grossly unfair
terms

• Both negotiated and standard terms Spain
• Only standard terms Germany
• Competition laws abuse of a dominant
  position/unfair terms.

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• -RECOVERY COSTS
• Decision of 10 March 2005
• -RETENTION OF TITLE
• Decision 26 October 2006
• -ENFORCEABLE TITLE
• -Regulation of the European Parliament and of
  the Council creating a European order for
  payment procedure, 12.12.2006.
• -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

Judgement 26 October 2006