EU 30-Day Payment Cap: What CFOs Must Know

The European Commission proposed something in September 2023 that would have rewritten the rules of B2B commerce across the entire EU: a mandatory 30-day payment cap on all commercial invoices. No extensions. No contractual workarounds. Just 30 days, full stop. The proposal came in the form of a Regulation, not a Directive. That distinction is critical. A Regulation applies directly and uniformly across all 27 member states. There is no room for local interpretation or creative transposition. The Commission chose this instrument deliberately, because the 2011 Late Payment Directive had failed to change payment behaviour in the countries where it mattered most. The data behind the proposal tells the story. Late payments cause one in four EU bankruptcies. More than 340,000 businesses fail each year with overdue invoices as a contributing factor. Italy averages 86 days to settle commercial invoices. Greece sits at 78. Even after more than a decade under the current Directive, average B2B payment periods across the EU still exceed 60 days. The proposed regulation would have made interest on late payments automatic and compulsory at the ECB reference rate plus 8 percentage points. Creditors would not have been permitted to waive their right to claim this interest, closing a loophole that large buyers have exploited for years by pressuring suppliers to forgo interest as a condition of continued business. The European Parliament softened the terms in its April 2024 vote, allowing up to 60 days by contractual agreement and 120 days for seasonal goods. But even the Parliament's amended version preserved the automatic interest mechanism and the non-waiver provision. The Council of the European Union ultimately stalled the proposal. The Polish Presidency reported in early 2025 that no compromise could be reached among member states. The Danish Presidency declined to continue discussions. But the underlying problem persists. The EU Payment Observatory confirmed in its 2025 report that payment performance continued to deteriorate in Italy, Greece, Spain, and Poland throughout 2024. For companies managing receivables across European borders, the message is clear. Regulatory pressure on payment terms is increasing, not decreasing. France already enforces domestic 60-day caps with real penalties. Germany is tightening its own rules. Whether the EU-wide regulation returns in its current form or evolves into something new, the direction is set. Companies that build robust collection strategies now will be ahead of the curve when the next legislative push arrives.