The law of 28 May 2019 amending the law of 2 August 2002 concerning the fight against late payment in commercial transactions was published in the Belgian Official Gazette on October 29, 2019. This law, based on what has been put in place in the Netherlands, aims to make payments to SMEs more fluid and thus promote their liquidity and investment policy.
This law incorporates the concept of SMEs into the law of 2002 and refers to the concept of small enterprise as defined in the Companies and Associations Code. According to this definition, SMEs are companies that do not exceed more than one of the following criteria:
– number of employees, as an annual average: 50 ;
– annual turnover, excluding value added tax: EUR 9,000,000,000.00;
– final balance: 4,500,000.00 EUR.
In practical terms, this means that parties to a commercial transaction (defined by law as, a transaction between companies or between companies and public authorities, that results in the supply of goods, the provision of services, or the design and execution of public works and construction and civil engineering works, in exchange for compensation) will no longer be able to agree on terms of payment exceeding 60 days if and only if the creditor to the transaction is a SME.
The law of 28 May 2019 provides that any contractual clause providing for a payment period greater than those sixty days is deemed unwritten.
These new provisions will only apply to contracts signed after the law comes into force, that is as of April 29, 2020.
For more information on the subject, please contact Ms. Virginie SCHOONHEYT esq. (email@example.com).
The Cairn Legal team.