Legal Process timer 4 min read

When a Public Authority Pays Late: Rules and Procedures

Public-sector customers usually pay, but only if the invoice is correct. Here are the rules on e-invoices, payment terms and interest when your customer is a Danish municipality, region or the state.

calendar_today 14 October 2026 update Updated 2 November 2026 timer 4 min read
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Public-sector customers: good payers with special requirements

Municipalities, regions and state institutions are attractive customers for many businesses: they are solvent and usually pay. But special rules apply to how you must invoice and when payment is due. Most late payments from the public sector happen because the invoice does not meet the requirements.

Electronic invoicing is mandatory

Under the Danish Public Payments Act (lov om offentlige betalinger) and the related rules, public authorities must receive invoices electronically. In practice the invoice is sent through the NemHandel infrastructure to the specific unit at the authority, identified by an EAN number (also called a GLN number).

  • Always get the EAN number and any references, for example an order number or contact person, when the order is placed
  • Send the invoice electronically through your accounting program or a NemHandel solution
  • Check that the invoice contains the information the authority has asked for

A public authority can postpone payment of an invoice that does not meet the requirements. In that case the authority must notify you as quickly as possible.

Expert tip: One wrong reference can cost weeks

In large public organisations, the invoice is routed automatically to the unit the EAN number points to. If the number or reference is wrong, the invoice can end up in the wrong place or be rejected. Get the details from the customer in writing, and double-check them before sending.

The payment term

Under section 3 b of the Danish Interest Act, the agreed payment term where the debtor is a public authority may as a rule be no more than 30 days. The Minister of Justice can allow a term of up to 60 days for certain public undertakings. If no due date has been agreed, interest runs 30 days after you requested payment (section 3).

An electronic invoice is considered received when it is available for loading into the authority's system.

Interest on late payment

If the authority pays late, you can claim late-payment interest under section 5 of the Interest Act: the reference rate (Danmarks Nationalbank's lending rate on 1 January and 1 July) plus 8 percentage points per year. Calculate interest from the due date and show the calculation clearly when you send a reminder.

How to follow up

  1. Check the invoice: was it sent correctly via NemHandel to the right EAN number with the right references?
  2. Contact accounts payable: many authorities have a central accounts payable or bookkeeping function. Ask whether the invoice has been received and approved, and who needs to approve it.
  3. Contact the person who ordered: often the invoice is simply waiting for approval by the employee who ordered the work.
  4. Send a written reminder with interest and a new payment deadline.
  5. Debt collection notice: before the case is sent to debt collection, a letter of demand with all the necessary information and a deadline of at least 10 days must be sent (section 10 of the Debt Collection Act).

Expert tip: Keep the tone factual

Public-sector customers are often long-term partners, and the delay is typically caused by internal procedures. A factual enquiry to the right person resolves most cases faster than a sharp reminder letter.

When there is a disagreement

If the authority disputes the invoice, for example because it believes the work was not done as agreed in the contract, it is an ordinary contract dispute. First check the contract or tender conditions for an agreed dispute procedure, such as negotiation, mediation or arbitration. Otherwise the dispute can be decided by the courts as an ordinary civil case.

Checklist for invoicing the public sector

  • The EAN number and references have been given to you in writing by the customer
  • The invoice is sent electronically via NemHandel
  • The payment term is no more than 30 days, unless an exception applies
  • The due date is clearly stated on the invoice
  • You follow up quickly if payment does not arrive

Getting started

With correct e-invoicing and fixed follow-up, most public-sector customers pay on time. If a case still gets stuck, you can use InkassoHurtig to get no-obligation quotes from police-authorised debt collection agencies and lawyers. This content is general information and not legal advice.

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