Anyone working with other businesses or with public bodies in Italy has a specific protection against late payment: Legislative Decree 231/2002, which implemented the EU Late Payment Directive. Many creditors do not use it because they do not know it.
Who it applies to
To all payments made as consideration in a commercial transaction, i.e. a contract between businesses (or between businesses and public administrations) involving the delivery of goods or the provision of services. Relationships with consumers are excluded.
Automatic accrual
Late-payment interest accrues automatically from the day after the payment deadline, without any formal demand. If the contract does not set a deadline, the statutory term is 30 days from receipt of the invoice (or of the goods/service, if later). The parties may agree longer terms, but as a rule not beyond 60 days, unless expressly agreed and not grossly unfair to the creditor.
The rate
The statutory late-payment rate is the European Central Bank reference rate plus 8 percentage points, updated every six months by notice of the Ministry of Economy. It is significantly higher than the ordinary statutory rate: on long delays, the difference is substantial.
The flat-rate compensation
In addition to interest, the creditor is entitled, without any reminder, to a flat-rate sum of 40 euros as compensation for recovery costs, plus reimbursement of any further reasonable costs incurred (art. 6). This amount must also be claimed: debtors rarely pay it spontaneously.
Clauses to check
- Clauses excluding late-payment interest or setting it at negligible levels: they may be declared void as grossly unfair.
- Excessively long payment terms imposed by the stronger party.
- Goods-conformity verification procedures used to artificially postpone the due date.
A well-written contract and a consistent reminder procedure make it possible to actually enforce these rights. Otherwise they remain on paper.
In managing business receivables I always include the calculation of interest under Legislative Decree 231/2002 and the compensation in the formal notice: besides being a right, it is a clear signal to the debtor that the position is being handled competently.
