From February 2022, a series of amendments to the Belgian law regarding the deadline for payment of invoices in B2B transactions will come into force, which aim to protect weaker business partners from the abuses and loopholes that have been exploited. over the years. Under the changes, the legal deadline for paying invoices in B2B transactions will be a maximum of 60 days from the date of the invoice. The changes further address the existing abuses of postponing the payment deadline for verification of goods / services and contractually agreeing to postpone sending the invoice as a means of delaying the start date of the payment deadline.
Current regime and proven abuses
The law of 2 August 2002 on the fight against late payments in commercial transactions (the “Law on Combating Late Paymentsâ€) Has long protected entrepreneurs and businesses against late payment of invoices from their business partners. This included, for example:
- Set the legal deadline for payment of invoices between companies at 30 days, although the parties are authorized to extend this period to 60 days;
- Unless otherwise agreed, an automatic late payment interest of 8% (from the third quarter of 2021) which will apply without any formal notice being necessary.
In recent years, however – and in part due to the provisions of the Anti-Late Payments Act – it has become clear that several loopholes have been (ab) used to bypass B2B protections, for example:
- Delay the start of the payment period until after verification of the goods or services. Article 4 of the Law on Combating Late Payments provides for a maximum of 30 additional days for these verification purposes. This would bring the payment term to a maximum of 90 days;
- (Contractually) the postponement of the supplier’s invoicing, to delay the start of the legal payment period.
In line with other recently adopted B2B protection measures (prohibition of unfair commercial practices, prohibition of abuse of economic dependence and prohibition of unfair terms), the Belgian legislator recently decided to fight against these abuses by amending the law on fight against late payments (see below).
New regime
From February 1, 2022, additional protections will be offered in B2B transactions with the adoption of the following payment terms:
- Payment period: If the agreement between the companies provides for a procedure for accepting or verifying the conformity of goods or services, this verification period will henceforth be part of the payment period. This reduces the payment term to 30 days, which can be extended by the parties for a maximum of 60 days in total;
- Invoicing date: The invoicing date can no longer be contractually postponed, the debtor having to provide all the information useful for invoicing no later than the date of delivery of the goods or services. This allows the creditor to issue an invoice immediately after delivery, starting from the legal payment period.
- Flat rate: In the event of late payment, the amount due is automatically increased by a flat rate of 40 € to cover recovery costs. This is in addition to the default interest of 8%.
What about existing agreements?
The changes to the law on the fight against late payments come into force on February 1, 2022. From that date, the agreements and conditions must be drawn up in accordance with the new legislation.