Commission: Referral of Greece to the European Court for late payments by hospitals

The European Commission has decided to refer Greece to the Court of Justice of the European Union for incorrect application of the rules based on the Late Payments Directive.

As the Commission highlights in its communication, payment delays have a negative impact on businesses, reducing liquidity, hindering growth, hindering resilience and potentially hindering efforts to become greener and more digital.

Under the current economic environment, businesses and especially SMEs rely on regular payments to operate and invest, he clarifies.

The Late Payment Directive obliges public authorities to pay their invoices within 30 days (or 60 days for public health authorities). By meeting these payment deadlines, public authorities are setting a good example in combating bad payment culture.

The referral

The Commission refers Greece to the Court of Justice of the European Communities due to payment practices by Greek public hospitals to their suppliers that violate the Late Payments Directive.

These hospitals do not honor the obligation to provide prompt payment of their debts when suppliers agree to waive their rights to interest, contrary to established case law. The Commission already referred Greece to the Court in November 2023 in another Late Payment case, targeting excessive payment delays by public hospitals in Greece (INFR(2019)2298).

Late payments by public hospitals hamper the competitiveness and resilience of businesses working in the health sector, especially SMEs. During the COVID-19 pandemic, these businesses played a key role in quickly resupplying hospitals, helping them stay operational.

The history of the case

According to the European Commission, late payment causes administrative and financial burdens, which are particularly acute when businesses and customers are located in different EU countries. Cross-border trade is inevitably affected. To address this, Directive 2011/7/EU on combating late payments in commercial transactions establishes strict measures which, when properly implemented by EU countries, make a significant contribution to employment, growth and improving business liquidity .

Member States have a special responsibility to ensure that public authorities pay in time for the goods and services they procure. The Commission is supporting Member States in enforcing the provisions of the Directive more effectively, including by making stronger monitoring and enforcement tools available.