e payment—will it work?
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john Lucy, director of Liverpool international operator William Lucy is in favour of a statutory right to interest on late payment of debts. His business is presently split 50:50 between UK and international haulage and some of the work takes him to Austria where a statutory right to interest on debts is enshrined in law.
Lucy says "companies have to pay interest if bills are paid late, so I used to get paid within 30 days from invoice." But as economic conditions have worsened in Austria, things have turned full circle and he now gets paid faster by the British end of the operation he was hauling for.
He wasn't sure though if a statutory right to interest on debt would work, a view which is backed by leading London-based commercial lawyer Steve Sidkin of Fox Williams. "Legally it would work, but commercially it would make no difference. Companies faced with these terms would either contract out of these contractual clauses or just say to firms, 'we want extra credit, and what you charge us in interest, we will adjust your bill by when we negotiate prices'."