EU Regulation on Payment Delays Likely to Be Withdrawn

The proposed EU regulation aimed at combating payment delays appears to be on the verge of being withdrawn following significant opposition from a majority of EU member states. According to the wholesale association Phagro, the EU Commission is likely to retract the draft regulation due to pressure from various member nations, including Poland, which initially championed the proposal.

Phagro reports that there is a widespread consensus among member states against further discussions on the matter, both within the EU Commission and the European Parliament. The European umbrella organization for full-service wholesalers (GIRP) has expressed optimism based on current information from Brussels, suggesting that the regulation will not be implemented.

Originally, the regulation mandated that companies pay invoices within 30 days, failing which they would incur penalty charges. However, this strict timeline was seen as a disadvantage by many in the business community, particularly small and medium-sized enterprises (SMEs) like pharmacies, which may benefit more from flexible and extended payment periods.

A compromise proposal was recently submitted during Poland's presidency of the Council, which concluded on June 30, 2025. This proposal suggested extending the payment deadline to a maximum of 120 days for business-to-business (B2B) transactions, along with a 60-day review period and specific guidelines for the public sector. Additionally, it included plans for a public EU debtor registry, which would require creditors to report and could impose fines for failure to do so.

Despite this compromise being formally passed to the Danish presidency for further consideration, it has since been removed from the current agenda. Phagro anticipates that the topic will not be revisited and that the original proposal will be officially retracted, although they acknowledge that formal withdrawals in Brussels can be challenging.

To reinforce their stance, Phagro, under the auspices of the Federal Association of Wholesale, Foreign Trade, and Services (BGA), has reached out to EU Commissioner Valdis Dombrovskis, urging him to abandon the initiative. Dombrovskis, responsible for reducing bureaucracy, has been asked to consider the implications of the proposed regulation on businesses.