The Late Payment of Commercial Debts Regulations 2013 came into force on 16th March 2013, which implements the 2011 EU Directive.
A number of changes have been made, which include debt recovery costs. Recovery costs can now be added to the compensation.
The Regulations provide that: “If the reasonable costs of the supplier in recovering the debt are not met by the fixed sum (i.e. the sum of between 40 and 100), the supplier shall also be entitled to a sum equivalent to the difference between the fixed sum and those costs” from debtors.
The EU Directive suggests that reasonable costs might cover instructing a lawyer or employing a debt collection agency.
At Nelsons we welcome the changes. It allows us, even in the absence of an agreement with the debtor, to recover our clients’ collection costs and therefore provide a service which pays for itself. Whilst there may be instances where debtors will try to refuse to pay debt collection costs, the new legislation will mean Nelsons has a good chance of recovering those costs for our clients.
How Nelsons Can Help
If you would like further details on this subject, or you need assistance with a debt recovery matter please contact our Debt Recovery team on 0800 024 1976 or via our online form.