Question

To ask the Secretary of State for Business, Innovation and Skills, what steps he is taking to ensure that companies do not circumvent the 30-day standard for paying suppliers by relocating their payment departments to other countries.

The Prompt Payment Code is a voluntary code for public, private and third sector organisations. Recent changes introduced a 30 day payment terms as a target which all signatories should work towards, and a maximum 60 day term. Whilst all signatories are actively encouraged to start complying with this early, it will come into force next year.

The Small Business, Enterprise and Employment Act 2015 provides the power to introduce a reporting requirement for all large companies to report on their payment practices and performance. This requirement will be used to monitor the payment performance of large company signatories to the Code.

A company which is registered in the UK will be subject to the new reporting requirements, regardless of where its payment department is located.