Abstract: The Directive on combating late payment in commercial transactions – Directive 2000/35/EC – had to be transposed into national law by August 2002. It is designed to reinforce the position of the creditor in cases of late payment. It defines cases where interest and/or compensation are due and fixes the level of interest at 7 percentage points above the interest rate of the European Central Bank. An unfairness clause prevents powerful undertakings from setting contractual payment terms that undermine the rules of the Directive. It thus limits party autonomy and tries to protect small and medium-sized enterprises against grossly unfair contract terms. The Directive also introduces a few basic principles on retention of title with the aim of enabling the creditor to exercise his rights throughout the Community. A careful examination of these provisions leads to the conclusion that the lex rei sitae should no longer be applied to movable goods. Instead, the lex contractus or, failing this, the law of the seller’s home country should determine the fate of the seller’s goods. In order to make the provisions of the Directive effective, it contains rules on speedy recovery procedures. Thus, Member States are obliged to ensure that their rules on civil procedure permit a creditor to obtain an enforceable title within 90 calendar days of lodging an action. The Directive is placed in the context of an emerging European private law. In particular, it will be part of the Commission’s efforts to create a European contract law.
European Review of Private Law