Late Payment of Commercial Debts Regulations 2002
| Year | 2002 |
2002 No. 1674
CONTRACTS, ENGLAND AND WALESCONTRACTS, NORTHERN IRELAND
The Late Payment of Commercial Debts Regulations 2002
Made 22th June 2002
Laid before Parliament 28th June 2002
Coming into force 7th August 2002
The Secretary of State, being a Minister designated1for the purposes of section 2(2) of the European Communities Act 19722in relation to measures relating to the combating of late payment in commercial transactions, in exercise of the powers conferred on her by that section hereby makes the following Regulations:
Citation, commencement and extent
1.—(1) These Regulations may be cited as the Late Payment of Commercial Debts Regulations 2002 and shall come into force on 7th August 2002.
(2) These Regulations extend to England and Wales and Northern Ireland3.
Amendments of the Late Payment of Commercial Debts (Interest) Act 1998
2.—(1) The Late Payment of Commercial Debts (Interest) Act 19984shall be amended as follows.
(2) Section 2(5)(c) and (6) (the Secretary of State’s power to specify by order categories of contracts as excepted contracts) are repealed.
(3) Section 3(4) and (5) (debts not to carry statutory interest if specified in an order made by the Secretary of State) are repealed.
(4) After section 5, there shall be inserted the following section—
“Compensation arising out of late payment
5A.—(1) Once statutory interest begins to run in relation to a qualifying debt, the supplier shall be entitled to a fixed sum (in addition to the statutory interest on the debt).
(2) That sum shall be—
(a)
(a) for a debt less than £1,000, the sum of £40;
(b)
(b) for a debt of £1,000 or more, but less than £10,000, the sum of £70;
(c)
(c) for a debt of £10,000 or more, the sum of £100.
(3) The obligation to pay an additional fixed sum under this section in respect of a qualifying debt shall be treated as part of the term implied by section 1(1) in the contract creating the debt.”
Proceedings restraining use of grossly unfair terms
3.—(1) In this regulation:
(a)
(a) “small and medium-sized enterprises” means those enterprises defined in Annex 1 to Commission Regulation (EC) No 70/2001of 12th January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises5;
(b)
(b) “representative body” means an organisation established to represent the collective interests of small and medium-sized enterprises in general or in a particular sector or area.
(2) This regulation applies where a person acting in the course of a business has written standard terms on which he enters (or intends to enter) as purchaser into contracts to which the Late Payment of Commercial Debts (Interest) Act 1998 applies which include a term purporting to oust or vary the right to statutory interest in relation to qualifying debts created by those contracts.
(3) If it appears to the High Court that in all or any circumstances the purported use of such a term in a relevant contract would be void under the Late Payment of...
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