New Rules on Payment Terms in Commercial Transactions
The government continuously is fighting against payment gridlocks between entrepreneurs. Because of that, since January 1st, 2020, the Act on Payments Terms in Commercial Transactions changed name for “Act on Combating Excessive Delays in Commercial Transactions”. Not only the name was changed. The legislator introduced also a number of changes aimed at improving cash flow in commercial transactions.
Higher Interest Rate for Delay in Payment
Until the end of 2019 interest rate for delay in commercial transactions was 9.5%. Currently it is 11.5%. You also have to remember that it can be changed anytime, because it is dependent on the guiding rate of National Bank of Poland. As indicated in the act, in the event of delay, the creditor can charge interest in the amount equal to the sum of the guiding rate of National Bank of Poland and ten percentage points. Public entities being healthcare entities, have better rate – the guiding rate of National Bank of Poland + eight percentage points.
Different Payment Terms Regarding Entrepreneur’s Size
The general rule has not changed. If the parties of a commercial transaction, excluding public entities being healthcare entities, agreed payment term longer than 30 days, the creditor may charge statutory interest after the lapse of 30 days from the date when his obligation was fulfilled and the invoice was delivered, until the date of payment. However, if the debtor is a large entrepreneur and the creditor – micro, small or medium entrepreneur (in the meaning of Appendix I to Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty), the payment term determined in the agreement may not exceed 60 days from the date of the invoice delivery to the debtor.
If payment term exceeds 120 days from the date of the invoice delivery to the debtor, he is entitled to withdraw from the contract or terminate the contract.
Statement on Having Status of Large Entrepreneur
In the light of the above, a debtor being a large entrepreneur should inform the other party of the transaction about having the status of large entrepreneur. The relevant statement should be made at latest in the moment of concluding the commercial transaction. Preferably it can be included in the contract. For not making such statement, there is a risk of criminal liability and imposing of fine.
Higher Compensation for Cost of Debt Enforcement
Before, the compensation for cost of debt enforcement was in every case EUR 40. Since January 1st, 2020, new, higher, rates were introduced:
- EUR 40 – when the amount of debt exceeds PLN 5,000;
- EUR 70 – when the amount of debt is between PLN 5,000 and PLN 50,000;
- EUR 100 – when the amount of debt is above PLN 50,000.
Prohibition of Excessive Delay in Paying Debts
After the amendment it is forbidden for entrepreneurs to have excessive delays in debts payments. According to the Act, as excessive delay you should understand a situation in which in the period of 3 subsequent months the sum of debts not paid and paid after the payment term, is equal to at least PLN 2.000.000.
The President of the Office of Competition and Consumer Protection is responsible for controlling the above. In case of finding such practice, a fine can be imposed.
Payment Terms Reporting to the Minister
Managers of capital groups or entrepreneurs, whose revenues in the fiscal year exceeded EUR 50,000,000, are obliged, until 31st January of each year, report to the Minister of Economy payment terms applied by the entrepreneur in the previous year and indicate what amount in what terms the entrepreneur received.
