The Commission decided to seek clarifications from Italy and Slovakia on their application and implementation of the EU's Late Payment Directive. The request for information in both cases takes the form of a letter of formal notice under EU infringement procedures.
Late payments constitute a major obstacle to the free movement of goods and services in the Single Market. They can impede cross-border trade and distort competition. Every year European businesses go bankrupt waiting for their invoices to be paid. Late payment has therefore a negative effect on the entire European economy.
The Late Payment Directive can be of considerable help to companies, especially small and medium sized enterprises (SMEs) which constitute 99% of all EU businesses. Adopted in 2011, the Directive responded to a real need to switch to a culture of prompt payment.
According to the Commission Italy is not applying the Directive correctly in practice. The Commission has received a number of complaints which highlighted the fact that in Italy the public authorities take on average 170 days to make payments for services or goods provided, and 210 days for public works. Slovakia provides for a dual system for late payment interest rates, a fixed one and a variable one. The Commission has doubts on the compatibility of this system with the late payment directive.