Every day across Europe, dozens of small and medium sized enterprises (SMEs) go bankrupt as their invoices are not paid.
As a result jobs are lost and business opportunities remain unexploited, the European Commission said in a statment here Tuesday.
A recent EU survey reveals that the written off debt suffered by Europe's businesses has reached to the unprecedented level of 340 billion euro, a figure equalling the total debt of Greece.
To end late payments the European Union adopted a legislation on combating late payment in commercial transactions.
By 16th March 2013, EU Member States will need to have integrated the revised legislation their national law.
It obliges public authorities to pay for goods and services within 30 calendar days or, in very exceptional circumstances, within 60 days. Businesses should pay their invoices within 60 calendar days, unless they expressly agree otherwise and if it is not grossly unfair to the creditor.
EU Commissioner for Industry and Entrepreneurship, Antonio Tajani, said in press statements that "late payments mean SMEs lose time and money, and disputes can sour relations with customers. This damaging late payment culture has to end."