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NEC ECC: Provision of Contractor Invoice

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Under the NEC there seems to be no provision for the Contractor to provide an invoice following payment certification.

Given that Public Sector Clients (some Private) require an Invoice to pay such Certifications, how do Project Managers/Clients deal with situations whereby a Contractor does not issue an invoice in time therefore incurring interest on delayed payments? Assume that one has to implement changes to the draft form?
asked Mar 5 in Payment by dellis (120 points)  

2 Answers

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If both businesses (the Employer / Client and Contractor) are registered for VAT then the submission of a valid VAT invoice is a legal requirement under the Value Added Tax Regulations, with the invoice required to contain certain information in relation to the supply.

If a Contractor does not submit a VAT invoice in time for payment to be made by the final due date for payment then, in theory, interest could accrue on the 'outstanding amount'.  

Public Sector Clients often amend the conditions, however, to include the submission of a VAT invoice to ensure compliance with specific payment obligations under the Public Contracts Regulations 2015.  Alternatively a self billing system may be implemented which removes the problems associated with timely submission of invoices.
answered Mar 5 by Andrew W-I Panel Member (26,920 points)  
0 votes
You're right that the NEC does not mention invoices therefore if the Employer / Client requires the Contractor to submit invoices they should include this in the contract in either the Works Information or as a Z clause.

Once the contract has been executed no party can vary the terms unilaterally, clause 12.3 requires any changes to the contract to be agreed, confirmed in writing and signed by the Parties. Note the term Parties means Contractor and Employer therefore the PM does not have the right to take this action.

You are correct in your assessment that if the Employer does not pay the Contractor on time the right to interest will accrue as in the standard ECC the Employer does not have the right to withhold payment until an invoice is received.
answered Mar 5 by Neil Earnshaw Panel Member (28,820 points)