Late Payments in Commercial Transactions in the European Union: Are We Getting Better?

Abstract

Over the years, late payments in commercial transactions have been recognized as one of the main problems of the EU companies, especially for Small and Medium sized (SMEs) ones. The European Union has made several efforts to solve this problem through legal regulations, which are supposed to accelerate the payment processes between companies. This descriptive paper is aimed at analyzing the current situation in the area of late payments in commercial transactions in the European Union. In the first part of this paper, an overview of the legal institutes, which regulate the area of late payments at the EU level, will be given.In the second part, the payment behaviour across the EU Member States will be analyzed by presenting data from payment reports of 2005, 2014, and 2015. Moreover, data on payment duration and payment delays of geographically different EU Member States (Germany, Hungary, France, and Italy) will be presented. The latter is carried out in order to compare the payment behaviour in three different periods and stakeholders (Consumer to Business, Business to Business, or Business to Public Sector).The final goal of this study on the one hand is to arrive at a conclusion of whether current legal provisions, in combating late payments in the EU, are providing the expected results and on the other hand to locate the main problems in this area and suggest further actions.