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3 November 2016

Consultation on payment complaints scheme for small businesses

The Department for Business, Energy and Industrial Strategy (BEIS) has opened its consultation on the mechanics of a new complaints scheme which is intended to help small businesses resolve disputes arising from their supply relationships with larger businesses.

The scheme will be run by the Small Business Commissioner whose role was established earlier this year under the Enterprise Act 2016. Under the current proposals the scheme will enable small businesses to bring a complaint against a larger business when in connection with payment issues in previous, current or potential supply relationships.

As drafted, the proposals define the term ‘payment issues’ to include any requirements imposed on a smaller business to pay additional fees, alterations to previously agreed fees and attempts to prevent complaints being made to the Commissioner on these grounds.

The intention of BEIS is that the Commissioner will enable the parties to resolve the payment issues to which the complaints relate, but decisions made by the Commissioner will not be binding on the parties.

The proposals seek input on various elements of the scheme, including the size of ‘small business’ that should fall within the scheme and the factors that the Commissioner should take into account when determining whether any action taken by a larger business was fair and reasonable.

The consultation closes on 7 December 2016 and those who want to get involved can find more information here.

This article is for general guidance only. It is not to be relied upon and professional advice should always be taken on specific circumstances.