What UK Procurement Act 2023 Section 73 - Implied Payment Terms in Sub-Contracts requires
UK Procurement Act 2023 (c. 54) Section 73, which fully came into force 24 February 2025, automatically implies the payment terms from Section 68(2) to (5) of the Act into every public sub-contract: the prime contractor as 'payee' under the public contract must pay sub-contractors within 30 days of receipt of a valid invoice, or 30 days from the date payment is due if no payment date is specified; Section 73(1) provides that 'The terms in subsections (2) to (5) of section 68 (implied payment terms in public contracts) are implied into every public sub-contract'; Section 73(2) clarifies that references to the 'contracting authority' in Section 68 apply to the sub-contract recipient (i.e., the supplier higher up the chain); Section 73(3) prohibits any contract term that purports to restrict or limit the implied payment terms (such terms are void); Section 73(4) preserves the right of parties to agree on EARLIER payment than the implied 30-day terms; Section 73(5) excludes concession contracts, utilities contracts awarded by private utilities, and school contracts from the implied payment terms framework; the section is the central transparency-and-fair-payment mechanism of the new UK procurement regime designed to address chronic late-payment to SME subcontractors.
Pillar: Public Sector & Government Procurement · Authority: Parliament of the United Kingdom (Procurement Act 2023, c. 54; Royal Assent 26 October 2023; commencement 24 February 2025) · Version: 1.0.0 · Last updated:
Primary source: https://www.legislation.gov.uk/ukpga/2023/54/section/73
SHA-256 integrity: b3aa97245171d84006c5c7120a9f17422e1c137dc369337d8eca1679260239ea
Primary Citations — 5 traced to source
- UK Procurement Act 2023 Section 73(1) IMPLIED PAYMENT TERMS IN SUB-CONTRACTS: 'The terms in subsections (2) to (5) of section 68 (implied payment terms in public contracts) are implied into every public sub-contract.'
- UK Procurement Act 2023 Section 73(2) REFERENCES TO CONTRACTING AUTHORITY: 'A reference in section 68(2) to (5) to the contracting authority is to be read as a reference to the party to the public sub-contract from whom the supplier is to receive payment.' - clarifies that the implied terms apply at each tier of the sub-contract chain
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