Judgment of the Court (Third Chamber) of 6 February 2025.Przedsiębiorstwo Produkcyjno – Handlowo – Usługowe A. v P. S.A.Reference for a preliminary ruling – Combating late payment in commercial transactions – Directive 2011/7/EU – Commercial transactions between undertakings – Article 3(5) – Obligation on Member States to ensure that the period for payment set in the contract concluded between undertakings does not exceed 60 calendar days – Possibility, for contracting parties, to set a longer period for payment – Condition for the express agreement in the contract of such a period – Condition that a contractual term is not grossly unfair to the creditor – Cumulative conditions – Contracts in which the terms are determined unilaterally by one of the parties – Contractual term by which the debtor unilaterally sets the period for payment of 120 days – Unlawfulness.Case C-677/22.

This judgment concerns the interpretation of Directive 2011/7/EU on combating late payment in commercial transactions, specifically regarding payment periods between businesses.The Court ruled on whether a payment period longer than 60 calendar days can be unilaterally imposed by one party. The case involved a dispute between two Polish companies where one party unilaterally set 120-day payment terms.The key provisions analyzed are:

• Article 3(5) of Directive 2011/7 which sets a general 60-day maximum payment period unless otherwise expressly agreed
• Two cumulative conditions for extending beyond 60 days: express agreement in contract and not being grossly unfair to creditor
• Requirements for what constitutes valid ‘express agreement’ between parties

The Court determined that:

• A payment period over 60 days cannot be unilaterally imposed by one party
• There must be clear evidence that both parties expressed their concurrence to be specifically bound by the longer payment term
• This can be satisfied through individual negotiation or clear highlighting of the term in standard contracts
• The term must also not be grossly unfair to the creditor, considering all circumstances

This judgment is particularly significant for protecting smaller businesses from having unfair payment terms imposed on them by larger companies in stronger negotiating positions.

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