Richard Bruton (Dublin North Central, Fine Gael)
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Question 272: To ask the Minister for Enterprise, Trade and Employment if he has considered the extension of the late payments legislation to the private sector; and the recent assessment he has undertaken of the extent of the payment of accounts within the private sector. [9536/05]

Micheál Martin (Cork South Central, Fianna Fail)
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The issue of late payments in the private sector is already addressed by the European Communities (Late Payment in Commercial Transactions) Regulations 2002, SI 388 of 2002. These regulations, which came into operation on 7 August 2002, apply to all commercial transactions with the following exceptions:

· Contracts made before 7 August 2002

· Claims for payment of late interest of less than €5

· Transactions with consumers

· Debts that may be subject to legislation other than these Regulations.

In accordance with these regulations, it is an implied term of every commercial transaction that where a purchaser does not pay for goods or services by the relevant payment date, the supplier shall be entitled to interest, "late payment interest", on the amount outstanding. The current interest rate applicable is 9% per annum or 0.0247% per day. This rate is set as at 1 January and 1 July each year at a rate of 7% above the European Central Bank interest rate on its most recent main refinancing operation. In the absence of any agreed payment date between the parties, late payment interest falls due after 30 days has elapsed.

In addition, the use of terms that are grossly unfair may be unenforceable and such terms may be challenged in court on the basis of criteria specified in the Regulations. Organisations representing small and medium sized enterprises may also challenge any terms that they feel breach the Regulations.

In June 2003, my Department conducted a survey in relation to the late payment in commercial transaction regulations. The survey questionnaire was sent to 1,107 randomly selected companies covered all regions of the country, all sectors and all sizes of enterprises and there was a response rate of 41%. Even though the regulations had been in force for a relatively short period at the time of the survey, it still showed that there was a very high level of awareness of the regulations among businesses with 82% of respondents being aware of the regulations. The survey also indicated that there had been a 7% improvement in the number of businesses paying their bills within 30 days.

Information in relation to the regulations is contained on my Department's website and the Department provides advice and information to purchasers and suppliers in relation to the operation of the regulations on an ongoing basis.