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What it is

Payment deadlines and late-payment interest between businesses

BOE step 7 of 7 · Passed

It is a government bill. Introduced by the Government. It was introduced on 18 June 2004. Introduced by: Gobierno.

Official title: Government bill establishing measures to combat late payment in commercial transactions.

Follow this law

Source: Congreso de los Diputados, file 121/000001· updated 11 Nov

Automatic summary, not yet reviewed

  1. The law fights late payment between businesses and between businesses and the Public Administration, and sets a 30-day payment deadline when the parties have not agreed on another one, counted from receipt of the invoice or of the goods and services.
  2. Late-payment interest accrues automatically from the mere delay in payment, with no need for the creditor to give notice or make a claim. The creditor can only demand it if they have met their obligations and were not paid on time.
  3. If there is no agreement, the late-payment interest rate is the European Central Bank rate plus seven percentage points, published every six months in the official gazette. The creditor can also claim compensation for recovery costs, capped at 15% of the debt.
  4. Abusive clauses that harm the creditor are void, for example those that extend payment deadlines or lower interest. Certain entities, such as business associations or chambers of commerce, can take legal action to stop their use.
  5. The seller can agree to a retention of title clause: they keep ownership of the goods sold until the full price is paid, and can hold the documents proving ownership.
  6. The law amends public procurement and retail trade rules: the Administration must pay within 60 days, and retail trade sets special deadlines for fresh and mass-consumption food products, with automatic late-payment interest.

Who it affects

  • Businesses that sell goods or services to other businesses: They can charge automatic late-payment interest and compensation for recovery costs if they are not paid on time.
  • Public administrations: They must pay contractors within 60 days and, if late, pay interest and recovery costs.
  • Retailers and their suppliers: They have specific payment deadlines depending on the type of product, plus automatic late-payment interest.
  • Subcontractors and suppliers: If the payment deadline exceeds 120 days, they can demand a guarantee (Aval A guarantee under which a bank or other entity commits to paying if the debtor does not.).

Words worth knowing

Interés de demora
Late-payment interest: extra money the debtor must pay as a penalty for paying late, on top of the debt.
Devengo automático
Automatic accrual: the interest starts counting by itself when there is a delay, with no need for the creditor to give notice or claim.
Reserva de dominio
Retention of title: an agreement under which the seller remains the owner of the goods until the buyer pays the full price.
Cláusula abusiva
Abusive clause: a contract term that unfairly harms one party and that a judge can declare void.
Aval
A guarantee under which a bank or other entity commits to paying if the debtor does not.

It summarizes the law as published in the BOE. 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 7 of 7 steps. It reached BOE, and today it is passed.

  1. Introduced18 June 2004Someone registers the text in the Congreso.
  2. Admitted22 June 2004The Bureau of the Congreso accepts it and, for a members’ bill, the plenary decides whether to consider it.
  3. Amendments24 June 2004Groups propose changes.
  4. Committee6 October 2004A committee goes through the text in detail.
  5. Plenaryno dateAll 350 deputies vote.
  6. Senate2 November 2004The Senate can pass it, amend it or veto it.
  7. BOE22 December 2004It is published in the Official State Gazette (BOE) and comes into force.
See the 10 official steps on a timeline
Jun 2004Jul 2004Aug 2004Sept 2004Oct 2004Nov 200411. 18 June 2004: Presentación22. 22 June 2004: Comisión de Justicia Publicación desde 22/06/2004 hasta 24/06/200433. 22 June 2004: Calificación44. 24 June 2004: Comisión de Justicia Enmiendas desde 24/06/2004 hasta 26/06/200455. 26 June 2004: Comisión de Industria, Turismo y Comercio Enmiendas desde 26/06/2004 hasta 06/10/200466. 6 October 2004: Comisión de Industria, Turismo y Comercio Informe desde 06/10/2004 hasta 19/10/200477. 19 October 2004: Comisión de Industria, Turismo y Comercio Aprobación con competencia legislativa plena desde 19/10/2004 hasta 02/11/200488. 2 November 2004: Senado desde 02/11/2004 hasta 01/12/200499. 1 December 2004: Pleno Enmiendas o veto del Senado desde 01/12/2004 hasta 22/12/20041010. 22 December 2004: Concluido - (Aprobado con modificaciones) desde 22/12/2004 hasta 25/01/2005

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?

It is law, or will be once published in the BOE. It comes into force on the date its own text sets.

The same initiative in the other chamber:

Presented before in:

Published in the BOE: Law 3/2004, of 29 December, establishing measures to combat late payment in commercial transactions.

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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