Australian Government press for more transparency to support quicker payments for SMEs

From its commencement on 1 January 2021, the Payment Times Reporting Act 2020 (Cth) (Act) introduces a new payment times reporting scheme which requires large businesses and large government enterprises (annual total income of over AU$100m) (reporting entities) to publicly report every six months on their payment terms and practices for their small business suppliers (annual turnover of less than AU$10m). Whilst it does not mandate compliance with any specific payment periods, its purpose is to create greater transparency regarding payment practices so that small businesses can make informed decisions about their customers. The Act also creates penalty provisions in relation to reporting breaches that come into effect after a 12-month transition period.