Part I

Statutory Interest on Qualifying Debts

Compensation arising out of late payment
5A
1
Once statutory interest begins to run in relation to a qualifying debt, the supplier shall be entitled to a fixed sum (in addition to the statutory interest on the debt).
2
That sum shall be–
a
for a debt less than £1000, the sum of £40;
b
for a debt of £1000 or more, but less than £10,000, the sum of £70;
c
for a debt of £10,000 or more, the sum of £100.
2A
If the reasonable costs of the supplier in recovering the debt are not met by the fixed sum, the supplier shall also be entitled to a sum equivalent to the difference between the fixed sum and those costs.
3
The obligation to pay
a sum
under this section in respect of a qualifying debt shall be treated as part of the term implied by section 1(1) in the contract creating the debt.
4
Section 3(2)(b) of the Unfair Contract Terms Act 1977 (no reliance to be placed on certain contract terms) shall apply in cases where a contract term is not contained in written standard terms of the purchaser as well as in cases where the term is contained in such standard terms.
5
In this section “contract term” means a term of the contract relating to a sum due to the supplier under this section.
4
Section 17(1)(b) of the Unfair Contract Terms Act 1977
(no reliance to be placed on certain contract terms) shall apply in cases where a contract term is not contained in written standard terms of the purchaser as well as in cases where the term is contained in such standard terms.
5
In this section “contract term” means a term of the contract relating to a sum due to the supplier under this section.
S. 5A inserted (7.8.2002) by S.S.I. 2002/335, reg. 2(5) (with reg. 4)
S. 5A inserted (7.8.2002) by S.I. 2002/1674, reg. 2(5)
S. 5A(4)(5) inserted (E.W. N.I.) (16.3.2013) by The Late Payment of Commercial Debts Regulations 2013 (S.I. 2013/395), regs. 1(1), 3(4) (with reg. 1(3))
S. 5A(2A) inserted (16.3.2013 for E.W. N.I. and 29.3.2013 for S.) by The Late Payment of Commercial Debts Regulations 2013 (S.I. 2013/395), regs. 1(1), 3(2) (with reg. 1(3)); The Late Payment of Commercial Debts (Scotland) Regulations 2013 (S.S.I. 2013/77), regs. 1(1), 3(2) (with reg. 1(3))
Words in s. 5A(3) substituted (16.3.2013 for E.W. N.I. and 29.3.2013 for S.) by The Late Payment of Commercial Debts Regulations 2013 (S.I. 2013/395), regs. 1(1), 3(3) (with reg. 1(3)); The Late Payment of Commercial Debts (Scotland) Regulations 2013 (S.S.I. 2013/77), regs. 1(1), 3(3) (with reg. 1(3))
S. 5A(4)(5) inserted (S.) (29.3.2013) by The Late Payment of Commercial Debts (Scotland) Regulations 2013 (S.S.I. 2013/77), regs. 1(1), 3(4) (with reg. 1(3))