BAE SYSTEMS PLC

Our 2025 Standard Conditions of Purchase provide for payment at the end of the month following the month in which an invoice is received, subject to (i) a valid invoice being properly provided by the supplier and (ii) the relevant Supplies being delivered and accepted by us, in accordance with the contract. The full text of the standard payment term can be located in Clause 9 of the 2025 Standard Conditions of Purchase at: https://www.baesystems.com/en-uk/what-we-do/suppliers/united-kingdom.

Whilst the company does contract certain of its material business on the basis of programme-specific bespoke terms and conditions, the relevant payment terms are largely consistent with those contained within the Standard Conditions of Purchase.

It is not precisely known when payments actually credit into a supplier’s bank account (we do not have systems that accurately record this event). Therefore for the production of the disclosed statistics, we have made a reasoned estimation of when payments have cleared into a supplier's bank account.

Where an invoice has been settled through the matching of a credit note, this invoice is not included in the payment statistics. If there is a partial match of a credit note against an invoice, the payment of the remainder of the invoice is included in the payment statistics.

As per our standard conditions of purchase, if a payment dispute arises, then the parties are required to follow a disputed invoicing process and use reasonable endeavours to resolve the dispute amicably. Any disputes that cannot be resolved are subject to arbitration.

Our full dispute resolution process can be found in Clauses 9 and 35 of the 2025 Standard Conditions of Purchase at: https://www.baesystems.com/en-uk/what-we-do/suppliers/united-kingdom