UK Procurement Act 2023: Cabinet Office clarifies e-invoicing and payment obligations
The UK Cabinet Office updated guidance on 19 June 2026 for the Procurement Act 2023, clarifying that contracting authorities must now accept and process e-invoices in EN 16931 format as an implied statutory term, replacing the need for explicit contract clauses.
The UK Cabinet Office published updated guidance on electronic invoicing and payment under the Procurement Act 2023. The guidance confirms that contracting authorities must accept and process e-invoices in the required EN 16931 format as an implied statutory obligation, strengthening supplier certainty around timely payment.
The UK Cabinet Office updated its guidance on 19 June 2026 for electronic invoicing and payment under Part 4 of the Procurement Act 2023. The update clarifies how statutory implied terms now apply across the public sector.
Four statutory pillars
The legal framework rests on four sections:
- Section 67 implies into every public contract a term requiring authorities to accept and process electronic invoices in the “required electronic form” where the invoice is undisputed.
- Section 68 implies payment terms, notably the 30-day rule, into most public contracts.
- Section 73 extends those payment terms to public sub-contracts.
- Section 88 applies the payment terms to regulated below-threshold contracts and their sub-contracts.
What changed from the 2015 regime
The Act extends acceptance obligations compared to the previous Public Procurement Regulations 2015. However, below-threshold contracts are still not required to mandate e-invoice acceptance.
The guidance stresses that the Act does not alter the fundamental e-invoicing standard introduced by the Public Procurement (Electronic Invoices etc.) Regulations 2019. Invoices must remain compliant with EN 16931, the European Standard. What changes is the mechanism: rather than requiring authorities to include a clause in their contracts, the obligation is now implied by statute.
The Cabinet Office recommends that contracting authorities still set out the obligation expressly in their contracts, even though it is now statutory.
What this means for suppliers and procurement teams
For suppliers, the change brings stronger contractual certainty around timely, electronic invoicing and payment. For procurement teams, it means revisiting contract templates to ensure alignment with sections 67 to 88 and confirming that e-invoicing receipt capabilities are in place across all in-scope contracts.