Late payment between businesses in Ireland: statutory interest and fixed compensation

This page reports what the official source says. It is not legal advice: ask the office named here. The main source is S.I. No. 580/2012, the European Communities (Late Payment in Commercial Transactions) Regulations 2012, on the Irish Statute Book, read in the text as made on October 9, 2026. The Statute Book page lists amendments separately; this page reports the Regulations as made. The Regulations give effect to an EU Directive of 2011 and came into operation on March 16, 2013. For the United Kingdom equivalent, see late payment between businesses in the UK.

Which transactions the Regulations cover

Regulation 2 defines a commercial transaction as a transaction between undertakings, or between an undertaking and a public authority, that involves delivering goods or providing services for remuneration. An undertaking is a person acting in the course of independent economic or professional activity. Regulation 3 says the Regulations do not apply to contracts made before March 16, 2013, to transactions with consumers, or to debts under insolvency proceedings. A consumer is a natural person acting outside their trade, business or profession.

When a payment counts as late

Regulation 2 defines the relevant payment date. Where the contract names a date or period for payment, that is the date. Where it names none, the date is 30 calendar days after the purchaser receives the invoice, or 30 calendar days after the goods are delivered or services provided if the invoice date is uncertain or the invoice arrives first. Where the contract sets a procedure of acceptance or verification and the invoice arrives on or before it, the 30 days run from the acceptance or verification. Where the contract names a date more than 60 calendar days after delivery, the date has to be expressly agreed in the contract and not be grossly unfair to the supplier.

Interest and the fixed sum

Regulation 4 makes it an implied term of every commercial transaction that if the purchaser does not pay by the relevant payment date, the supplier is entitled to statutory late payment interest "without the necessity of a reminder". Interest runs from the day after the relevant payment date until the day payment is made. The supplier is entitled only to the extent they fulfilled their contractual and legal obligations and the purchaser is responsible for the late payment.

Regulation 5 sets the rate, unless the contract says otherwise: the interest rate the European Central Bank applied to its last main refinancing operation carried out before January 1 and July 1 in each year, plus 8 percentage points. The rate in force on January 1 covers January 1 to June 30, and the rate in force on July 1 covers July 1 to December 31. The ECB page explains that main refinancing operations are the operations in which banks borrow from the ECB against collateral on a weekly basis, and it lists every change of that rate with its date. This page prints no rate, because the rate depends on the ECB figures for the date of the late payment.

Regulation 9 adds a fixed sum once interest becomes payable. The supplier does not have to show that they incurred recovery costs. The amounts are in the Schedule.

Regulation 9(3) adds that the supplier may also obtain reasonable compensation for recovery costs above the fixed sum, and it names instructing a lawyer and employing a debt collection agency as examples.

Terms that vary the rules

Regulation 6 lets a supplier who considers a contract term grossly unfair apply to the Circuit Court or to an arbitrator, where the term waives or varies the relevant payment date (when the contract names none) or the interest term. The court or arbitrator can declare the term grossly unfair or unenforceable, vary it, or direct compensation. The Regulation lists what is weighed, including good commercial practice, the relative strength of the parties' bargaining positions and whether the supplier knew of the term. Regulation 8 lets a representative body for small and medium-sized enterprises apply to the Circuit Court about terms drawn up for general use. The explanatory note to the Regulations says a clause that seeks to exclude interest or compensation is held to be grossly unfair.

The 2002 Regulations

Regulation 10 revokes S.I. No. 388/2002 from March 16, 2013, and Regulation 11 says the 2002 Regulations continue to apply to contracts made before that date. Those Regulations used the same ECB reference rate plus 7 percentage points, and excluded claims for interest of less than EUR 5. They apply to contracts made on or after August 7, 2002 and before March 16, 2013. For small claims limits and courts, see small claims limits for consumer disputes.

Sources

• Irish Statute Book, S.I. No. 580/2012, European Communities (Late Payment in Commercial Transactions) Regulations 2012, as made December 22, 2012, read October 9, 2026
• Irish Statute Book, S.I. No. 388/2002, European Communities (Late Payment in Commercial Transactions) Regulations 2002, read October 9, 2026
• European Central Bank, key ECB interest rates, read October 9, 2026