On 19 July 2018, the Polish Parliament adopted the act on amending certain acts to limit payment backlogs.
The act contains a whole set of legal solutions (tax changes, civil law and administrative solutions), aimed at reducing payment backlogs. One of the important changes is the shortening of payment deadlines in transactions between entrepreneurs or other entities covered by the act. Public entities will have to pay for services and products in 30 days, with the exception of medical institutions that will have 60 days to make all their due payments. As for transactions involving micro-, small or medium-sized companies as creditors and larger contractors as debtors, the payment deadline may not exceed 60 days. The amount of interest that an entrepreneur may demand has also been increased if the other party to a commercial transaction does not pay for goods or services.
The Office of Competition and Consumer Protection will intervene in cases when delays in payment are excessive. UOKiK will be able to react if the sum of outstanding payments due to an entrepreneur over the next three months amounts to at least PLN 5 million to 2021 and PLN 2 million in subsequent years.
Proceedings will be initiated ex officio and will have to be completed within 5 months. Everyone, both an entrepreneur who fell victim to a payment backlog, and a person suspecting that an entity does not pay its contractors, may notify UOKiK that payments are not made on time. During the proceedings, the Office will audit payments from the two years preceding the initiation of the proceedings. Fines will be calculated using the formula based on the value of late payments, the delay period and statutory interest rate for delay in commercial transactions. A fined entrepreneur will have the right to request its case be re-examined before UOKiK and, if necessary, file a complaint with a provincial administrative court.
The Office will be able to reduce the fine by 20% if an entrepreneur repays the amount due with interest within 14 days from the delivery of the UOKiK’s decision to initiate proceedings. The Office may also reduce the fine by a further 10% if a debtor immediately pays the fine and waives the right to file a request for the case re-examination by the office. Entities that do not pay their contractors because they themselves have not received money from their debtors will not be fined. However, if UOKiK finds out that a previously fined entrepreneur is behind with its payments again, and excessively, the next fine imposed may be increased by 50%.
