1.) The right to claim interest for late payment, the right to claim
Before the Late Payment of Commercial Debts (Interest) Act 1998, debts were only claimable if they were described in the contract or if the supplier sued the debtor in a court of law.
With the legislation, it was possible for creditors to legally add late payment compensation to any business transaction that fails to meet time requirements and the grossly unfair requirements.
2.) The right to claim reasonable debt recovery costs, unless the supplier has acted unreasonably
If the supplier has incurred debt due to trying to recover the debt, they may receive compensation for their troubles.
The courts can also reduce or dismiss any interest that is due to the creditor if they feel that their conduct was not appropriate in the process of reclaiming debt.
3.) The right to challenge contractual terms that do not provide a substantial remedy against late payment
If there is a contractual term relating to chasing debts or claiming compensation that is grossly unfair, then it can be challenged.
Late payment of commercial debts can incur interest and costs even if the specific wording in the contract has a longer late payment date or a longer acceptance procedure period, as long as they are judged to be grossly unfair.
4.) The right for “representative bodies” to challenge contractual terms that are grossly unfair on behalf of SMEs
Small to medium enterprises (SMEs) can search for legal help to review current contractual obligations and search for terms and conditions that are grossly unfair to the supplier.
Although small businesses may worry about annoying or chasing away larger affiliates, they are encouraged to stand up for themselves against irresponsible clients and claim what is rightfully theirs.