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What it is

Bill to penalize companies that pay suppliers late

Admitted step 2 of 7 · Unfinished

It is a members’ bill. Introduced by parliamentary groups, the Senate, regional governments or citizens. It was introduced on 18 February 2020. Introduced by: Grupo Parlamentario Plural.

Official title: Private member's bill amending Law 3/2004, of 29 December, establishing measures to combat late payment in commercial transactions, to regulate a regime of infractions and sanctions.

Follow this law

Source: Congreso de los Diputados, file 122/000035· updated 11 Nov

Automatic summary, not yet reviewed

  1. The bill would add a system of infractions and penalties for late payment to Law 3/2004, because there is currently no specific regulation and large companies are the worst late payers.
  2. It would reorganize Law 3/2004 into titles and create a new title classifying late payment infractions as minor, serious or very serious, with their limitation periods.
  3. It would add transparency rules: commercial companies and public administrations would have to publish their average supplier payment period, and a State Observatory on Late Payment would be created.
  4. Penalties would be fines of up to €3,000 for minor infractions, up to €100,000 for serious ones and up to €1,000,000 for very serious ones. The offender would also have to pay the outstanding debts to the creditor.
  5. Anyone who pays the creditor within ten days of being notified of the penalty could request a 25% reduction of the fine, if there is no repeat offense.
  6. The bill would also amend the Retail Trade Organization Law to align its payment periods, the Unfair Competition Law to treat repeated late payment as unfair, and the VAT Law so companies can recover VAT on unpaid invoices sooner.

Who it affects

  • Companies, especially large companies that pay late: Would have to pay within legal periods and publish their average payment period; could face fines if they fail to comply.
  • Public administrations: Would have to publish reports and their average supplier payment period.
  • Small and medium-sized businesses and self-employed creditors: Could report late payments through an anonymous online channel and benefit from the penalties and debt payments.
  • Autonomous Communities and the General State Administration: Could impose penalties and handle the case files.

Words worth knowing

Morosidad (late payment)
Not paying a debt within the contractual or legal period, when the creditor has met their own obligations.
Prescripción (limitation period)
The maximum time to penalize an infraction or enforce a penalty; once it passes, no action is possible.
Reincidencia (repeat offense)
Committing another infraction within one year, as defined in the bill itself.
Base imponible (tax base)
The amount on which VAT is calculated; reducing it lets a company recover the tax on invoices it has not been paid.
Competencia desleal (unfair competition)
Conduct by a company that unfairly harms others in the market; the bill includes repeated late payment.

It summarizes the text as it was introduced. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries

Where it stands

How far did it get?

It took 2 of 7 steps. It reached Admitted, and today it is unfinished.

  1. Introduced18 February 2020Someone registers the text in the Congreso.
  2. Admitted25 February 2020The Bureau of the Congreso accepts it and, for a members’ bill, the plenary decides whether to consider it.
  3. Amendmentsnot reachedGroups propose changes.
  4. Committeenot reachedA committee goes through the text in detail.
  5. Plenarynot reachedAll 350 deputies vote.
  6. Senatenot reachedThe Senate can pass it, amend it or veto it.
  7. BOEnot reachedIt is published in the Official State Gazette (BOE) and comes into force.
See the 5 official steps on a timeline
Feb 2020Mar 2020Apr 202011. 18 February 2020: Presentación22. 25 February 2020: Boletín Oficial de las Cortes Generales Publicación desde 25/02/2020 hasta 28/02/202033. 25 February 2020: Calificación44. 28 February 2020: Gobierno Contestación desde 28/02/2020 hasta 05/05/202055. 5 May 2020: Concluido - (Decaído) desde 05/05/2020 hasta 08/05/2020

Was there a plenary vote?

We have no plenary vote linked to this law in the Congreso’s data.

What happens next

What happens now?

The legislature ended before it finished. To go on, someone would have to introduce it again in the new Cortes.

It has not been presented again yet.

Sources

Where does all this come from?

  • The data comes from the open files of the Congreso, the Senate and the BOE, unaltered.
  • Each deputy’s province is the one of their seat on the day of the vote.
  • We only say “passed” or “rejected” when the majority needed is certain; otherwise we say which side had more votes.

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