Search Legislation

The Late Payment of Commercial Debts (Rate of Interest) (No. 3) Order 2002

What Version

 Help about what version
  • Latest available (Revised)
  • Original (As made)

Opening Options

 Help about opening options

Status:

This is the original version (as it was originally made). This item of legislation is currently only available in its original format.

Statutory Instruments

2002 No. 1675

CONTRACTS, ENGLAND AND WALES

CONTRACTS, NORTHERN IRELAND

The Late Payment of Commercial Debts (Rate of Interest) (No. 3) Order 2002

Made

22nd June 2002

Laid before Parliament

28th June 2002

Coming into force

7th August 2002

The Secretary of State, having considered the extent to which it may be desirable to set the rate of statutory interest so as to protect suppliers whose financial position makes them particularly vulnerable if their qualifying debts are paid late and deter generally the late payment of qualifying debts, with the consent of the Treasury, in exercise of the power conferred on her by section 6 of the Late Payment of Commercial Debts (Interest) Act 1998(1), and of all other powers enabling her in that behalf, hereby makes the following Order:—

Citation, commencement and extent

1.  (1)  This Order may be cited as the Late Payment of Commercial Debts (Rate of Interest) (No. 3) Order 2002 and shall come into force on 7th August 2002.

(2) This Order extends to England and Wales and Northern Ireland(2).

Revocation

2.  The Late Payment of Commercial Debts (Rate of Interest) (No. 2) Order 1998(3) is hereby revoked.

Interpretation

3.  In this Order, “the official dealing rate” means the rate announced from time to time by the Monetary Policy Committee(4) of the Bank of England (“the Bank”) and for the time being in force as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short term liquidity in the money markets.

Rate of statutory interest

4.  The rate of interest for the purposes of the Late Payment of Commercial Debts (Interest) Act 1998 shall be 8 per cent per annum over the official dealing rate in force on the 30th June (in respect of interest which starts to run between 1st July and 31st December) or the 31st December (in respect of interest which starts to run between 1st January and 30th June) immediately before the day on which statutory interest starts to run.

Nigel Griffiths

Parliamentary Under-Secretary of State for Small Business

Department of Trade and Industry

22nd June 2002

We consent to the making of this Order

Anne McGuire

Tony McNulty

Two of the Lords Commissioners of Her Majesty’s Treasury

14th May 2002

Explanatory Note

(This note is not part of the Order)

This Order replaces the Late Payment of Commercial Debts (Rate of Interest) (No. 2) Order 1998 (S.I. 1998/2765), which is revoked by Article 2.

The Late Payment of Commercial Debts (Interest) Act 1998 (“the Act”) provides qualifying creditors with a statutory right to claim interest on qualifying debts from qualifying debtors. This Order, made under section 6 of the Act, sets the rate of statutory interest which may be claimed.

The variable rate of statutory interest is that set at the official dealing rate of the Bank of England in force at the time when late payment interest becomes payable plus 8 per cent (Article 4). The official dealing rate of the Bank of England is announced from time to time by the Bank’s Monetary Policy Committee. The rate is sometimes called the “repo” rate, since repos or sale and repurchase agreements are one type of monetary policy instrument used by the Bank. At the time of making this Order, the official dealing rate is published daily in the “Financial Times” (except on Sundays), together with the date on which the rate was last announced. It is referred to as the “UK clearing bank base lending rate” and can be found in the section entitled “London Money Rates”. It is also published on the Bank of England website, www.bankofengland.co.uk.

For the purposes of this Order the official dealing rate to be used is that in force on 30th June or 31st December in any year. This rate will apply as the official dealing rate for the following six month period, namely 1st July to 31st December or 1st January to 30th June respectively.

This order partially implements Directive 2000/35/EC of the European Parliament and Council of 29th June 2000 on combating late payment in commercial transactions. A Transposition Note detailing the manner of implementation of this Directive is available at www.dti.gov.uk or from Investment Directorate, Small Business Service, St Mary’s House, c/o Moorfoot, Sheffield S1 4PQ. Tel: 0114-259-7847.

(2)

The functions of the Secretary of State under the Late Payment of Commercial Debts (Interest) Act 1998, insofar as they relate to Scotland, have been transferred to Scottish Ministers by virtue of section 53 of the Scotland Act 1998 (c. 46).

(3)

S.I. 1998/2765.

(4)

The Monetary Policy Committee was constituted on a statutory basis by section 13 of the Bank of England Act 1998 (c. 11).

Back to top

Options/Help

Print Options

Close

Legislation is available in different versions:

Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.

Original (As Enacted or Made):The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.

Close

Opening Options

Different options to open legislation in order to view more content on screen at once

Close

More Resources

Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as enactedversion that was used for the print copy
  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • correction slips
  • links to related legislation and further information resources
Close

More Resources

Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:

  • the original print PDF of the as made version that was used for the print copy
  • correction slips

Click 'View More' or select 'More Resources' tab for additional information including:

  • lists of changes made by and/or affecting this legislation item
  • confers power and blanket amendment details
  • all formats of all associated documents
  • links to related legislation and further information resources