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Debt collection procedures around the world
Thread poster: Parrot

Parrot  Identity Verified
Spain
Local time: 00:49
Member (2002)
Spanish to English
+ ...
Jun 15, 2006

With the blessings of the moderator of this forum, I would like to invite members and guests to share what they know about debt collection procedures in their part of the world in order to enrich our knowledge base.

As many of you are aware, Directive 2000/35/EC of the European Parliament against late payment in commercial transactions enjoins Member States to work towards its transposition into national law. Status as reported to date is:

http://ec.europa.eu/enterprise/regulation/late_payments/implementation.htm

What this specifically means for us as translators in terms of leg- and paperwork is thus part of an ongoing process, the status of which which we shall also have to update from time to time as the laws develop.

I'll start off with Spain:

The Spanish Proceso Monitorio forms part of the LEC, or Law on Civil Procedure. It has an upper limit of 30,000 euro, and no lawyers are required to initiate proceedings. It begins with a petition addressed to the Juzgado Decano or Decanato of the debtor's jurisdiction, which is charged with assigning all cases admitted to docket.

In order to find the Decanato corresponding to the debtor's jurisdiction, go to www.poderjudicial.es , click on "Consejo General del Poder Judicial", then on the tab "Organización Judicial", and lastly on the left-hand menu "Directorio de Organos". You will find an interactive map of Spain that leads to the contact data of all the Courts in the country. If in doubt, call the Decanato Unico closest to the debtor's location.

The Decanatos currently provide forms on which the petition may be made by filling in the blanks. However, the sample form from Madrid recommended for translators should serve our purposes:

PROCESO MONITORIO

Presentado ante el Juzgado Decano de Madrid
C/ Capitán Haya 66 bajo
Tel.: 91 3971300


AL JUZGADO


Don/Doña____________________, traductor autónomo con NIF no. _____________, domiciliada en la calle ____________, no. ______, piso ________, de la ciudad de _________, código postal ___________, con no. de teléfono _____________ y Fax __________, Dirección de correo electrónico _____________, formulo la presente:

RECLAMACIÓN en proceso MONITORIO de LA FACTURA __________ DE _________ DE 200___ más costas, contra:

La empresa / autónomo ___________, con NIF/CIF no. ____________, domiciliada en la ________________, de la localidad de ________________-, código postal ___________, con no. de teléfono _____________, dirección de correo electrónico ____________________.

La cantidad reclamada tiene origen en las relaciones mantenidas por las partes y concretamente el pasado día___________, cuando por solicitud del Sr. _________, se realizó una traducción de __________ a _________, cuyo precio unitario se acordó en _________ euros + 16% de IVA - X% de retención. Total final _________.
Se acompaña a este escrito el documento del que resulta la deuda: factura _____

En atención a lo expuesto PIDO AL JUZGADO:

1o. - Que se requiera de pago al deudor para que en el plazo de veinte días pague la cantidad de _______, más las costas, y para el caso de que el deudor no pague la deuda ni dé razones por escrito para no hacerlo, se dicte auto ordenando el embargo de bienes suficientes del deudor para cubrir la suma de __________, más todos los costes derivados las costas procesales.

2o. - Que si el deudor se opone por escrito alegando razones para negarse total o parcialmente al pago, se convoque a las partes a juicio verbal o se me conceda el plazo legal de un mes para formular la demanda de juicio ordinario, pidiendo desde este momento, para el caso de oposición, el embargo de bienes del deudor, y en su día la condena a la parte demandada al pago de la cantidad de ________, así como al pago de las costas procesales.

En Madrid, a ___ de _______ de ________

Firma y sello:



Relación de documentos adjuntos:
Factura no.
E-mails procedentes
Órdenes de pedido (etc.)


Notification to pay is thus sent to the debtor. He has two choices: he can pay, or he can challenge the claim. If he challenges the claim within twenty days from receipt of the notice, the process ends and the pertinent hearing (as the case may warrant) becomes proceeding. If, on the other hand, he does not pay and he fails to challenge the claim within the twenty-day interval allowed for the purpose, the claim becomes automatically enforceable and collection proceedings are initiated.

Since the process applies to any kind of debt (including personal loans, unpaid homeowner association receipts, and the like), accompanying documents vary widely. Commercial documents may include invoices, delivery notes, purchase orders and e-mails. It is also possible to initiate action at a Decanato other than the debtor's (for example, at one's own jurisdiction), or by legal post, but the referral process will make proceedings last longer.

Lastly, it is possible for foreign creditors to make use of the Proceso Monitorio, provided that they furnish an address for notifications in Spain. Since it is not necessary to have a lawyer, they may use the services of a Gestor Administrativo empowered for the purpose to receive and send their messages.

More data is available in Spanish at: http://www.proz.com/howto/163

Looking forward to reading other contributions.

[Edited at 2006-06-15 12:24]


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Ralf Lemster  Identity Verified
Germany
Local time: 00:49
English to German
+ ...
Germany: Mahnbescheid Jun 15, 2006

Thanks for kicking this off, Ceci.

Germany operates a system called Mahnbescheid where creditors can serve a court notice on debtors, subject to certain requirements.

Our fellow moderator Mats Wiman posted a summarised explanation a few years ago. More details - particularly regarding cross-border procedures - are available from various solicitors' websites (this one, for example).

Thankfully, the only hands-on experience I have with this procedure was related to a minor amount my company was owed by a major software supplier. The Mahnbescheid notice got their attention, and they duly paid, including the solicitors' fees incurred.

However, it is worth noting that
- debtors have the right to reject a Mahnbescheid, in which case the creditor will need to take court action;
- any such procedures are only really worth taking unless the debtor has been declared insolvent (in which case it might still be worthwhile, but legal advice is necessary).

HTH, Ralf

[Edited at 2006-06-15 13:55]


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Samuel Murray  Identity Verified
Netherlands
Local time: 00:49
Member (2006)
English to Afrikaans
+ ...
South Africa Jun 15, 2006

Parrot wrote:
With the blessings of the moderator of this forum, I would like to invite members and guests to share what they know about debt collection procedures in their part of the world in order to enrich our knowledge base.


By law, all South African debt collectors must be registered with the South African Council for Debt Collectors[1]. You can search their register of debt collectors online [2]. Debt collection in South Africa is subject to the Debt Collectors Act (Act 114 of 1998) [3].

Generally, debt should be handed over when the invoice is 90 days overdue, unless the excuses and repeated broken promised by the client indicate sooner that the debt may not be paid. Usually, the debt collection agency takes 30% of whatever they manage to recover.

[1] http://www.debtcol-council.co.za/
[2] http://www.debtcolregister.co.za/ (requires IE)
[3] http://www.info.gov.za/gazette/acts/1998/a114-98.pdf


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Anil Gidwani  Identity Verified
India
Local time: 05:19
German to English
+ ...
India Jun 19, 2006

Debt collection procedures are painfully slow in India.

I'm not personally aware of any debt collection agencies in India.

The judicial system is slower than the [your favorite glacier here] glacier. It may take you upto six months to serve a summons on the defaulting party, and the next ten years to get a decree in your favor. Add another ten years to perhaps get your amount due. You may or may not (probably not) be able to recover solicitor's fees, which are on the high side.

In fact, debtors gleefully exploit the hopeless inefficiency of the judicial system to intimidate the aggrieved creditor into writing off a large chunk of the debt.

You'd be better off writing off any amount owed to you in India.


[Edited at 2006-06-19 14:14]

[Edited at 2006-06-19 14:15]


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MariusV  Identity Verified
Lithuania
Local time: 01:49
English to Lithuanian
+ ...
well... Jul 3, 2006

I partially agree to Ralph. What could one do if the client has several million of debts, owes you some 500 EUR, became insolvent or even declared bankruptcy? There is nothing to be done. What sense is to go even the legal way if you know that you win, but will never see the money?

But let's consider another side - the psychological effect. I believe that there are kind of people with kind of mentality - "we are in one part of the world, that translator is some 3000 km away - let's have this job done "for free" - what will he/she do? Go to us for some 400 USD? Take legal actions? He/she will forget it seeing there is nothing could be done and that is it". I think that 2 of 3 of cases with such people would work - it would be enough that someone from the client "homeland" contacts the non-payer and show that it will be impossible to hide the head in the sand. E.g. - one case from my own practice. The client simply ignored my emails for half a year, the "boss was either unavailable or on holiday" when I called. BUT it was just enough for them to receive a call from a debt collection/lawyer agency a couple of streets next to them, and the next day I had a long email with excuses, and the transfer made in a couple of days afterwards.

In my country (Lithuania) we have many small debt collection agencies. If, say, someone from Lithuania (client) cheats someone in another country, all what is needed - 1) an athorisation of the applicant to act in his/her namefor debt collection 2) documents for the proof (that "A" has not paid "B" the amount "C"). All the rest - is not a problem of the applicant - these people arrange everything. You will ask - what is the interest for them to get involved into the amounts of several hundred? Well, the legal procedure is quite a simple one, and they will add for their services quite a lump amount. The bailiffs are private (they are almost a nightmare of those, who do not want to settle payments), so they are very interested to have even small "clients" as they also add lump amounts for their services too. If you owe 200 USD, the "total" amount can be several times bigger. Preparation of all docs will take half an hour max (if all docs are available and in good order)...






[Edited at 2006-07-03 00:23]


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Bubo Coromandus

Spanish to English
Spain, continued (debt collection procedures around the world) Oct 17, 2006

I'm following up on Parrot's very informative posting about debt collection procedures in Spain.

I live in Tenerife and an agency in Denia, Alicante has owed me 963.35 € since 14th June 2006. When it became clear they had no intention of paying, I sent a "reclamación" to the Juzgado Monitorio in Denia by registered post, and they received it on 11th September.

I have telephoned twice for information. The first time they gave me a "número de identificación general". The second time (today, 17th October) they gave me a "número de procedimiento" ("número de monitorio") - 565 of the year 2006. The matter is still in the "Secretaría" "pendiente de incoarse". I asked the reason why it was not being dealt with yet and was told they have a lot of similar claims to deal with.

I asked when I should ring again and they advised me to leave it a couple of weeks.

Has anybody used this procedure successfully, and how long did it take etc.? Is there anything one can do to speed things up?

Any comments gratefully appreciated.


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gemma g
English to French
Have you got any further with your monitorio? Mar 28, 2007

Deborah Lockett wrote:

I'm following up on Parrot's very informative posting about debt collection procedures in Spain.

I live in Tenerife and an agency in Denia, Alicante has owed me 963.35 € since 14th June 2006. When it became clear they had no intention of paying, I sent a "reclamación" to the Juzgado Monitorio in Denia by registered post, and they received it on 11th September.

I have telephoned twice for information. The first time they gave me a "número de identificación general". The second time (today, 17th October) they gave me a "número de procedimiento" ("número de monitorio") - 565 of the year 2006. The matter is still in the "Secretaría" "pendiente de incoarse". I asked the reason why it was not being dealt with yet and was told they have a lot of similar claims to deal with.

I asked when I should ring again and they advised me to leave it a couple of weeks.

Has anybody used this procedure successfully, and how long did it take etc.? Is there anything one can do to speed things up?

Any comments gratefully appreciated.


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Parrot  Identity Verified
Spain
Local time: 00:49
Member (2002)
Spanish to English
+ ...
TOPIC STARTER
Unfortunately, speed is not the point Mar 28, 2007

Deborah Lockett wrote:

Has anybody used this procedure successfully, and how long did it take etc.? Is there anything one can do to speed things up?


The PM includes late interest. But keep the case numbers, it's part of the "protocolo".


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adarve01
Spanish to English
Debt collection in Spain Jun 12, 2008

In Spain the high unemployment figures, fall in industrial production (the highest since June 2002), downturn in the service industry and low level of consumer confidence clearly show that the Spanish economy is in a slowdown.

Default rates on consumer and business loans from banks, savings institutions and credit cooperatives rose to 1.126% in March 2008, after nine consecutive months of increases, bringing them to levels not seen for more than seven years. September 2001 was the last time default rates were so high.

To collect debts in Spain will be a very intensive activity.

The collection legal procedure in Spain depends on the size of the debt and on how it is arisen.

Under Spanish Law there are the following types of proceedings:

Trial judgements:
Ordinary proceedings: for debts exceeding Euros 3.005, or when the amount of the claim can not be determined in advance.
Verbal proceedings: for debts not exceeding Euros 3.005.
The proceeding starts with the lawsuit, which will be served on the defendant, who should present a defence to the court. After these first steps, a hearing takes place in order to reach an agreement, rectify material mistakes, make complementary pleadings or denounce the breach of procedural rules.
If no agreement is reached in the hearing, the proceeding goes on with the evidence period. After it, the court can order specific measures to clarify issues or facts which remain uncertain and gives judgment, which can be enforced if the plaintiff makes an application. There is a right of appeal against judgments to the Court of Appeal.


Summary judgements:
“Monitorio”: for debts not exceeding Euros 30.005, being the debt supported
by any of the following documents:

Documents concerning the debt signed by the debtor.
Invoices, delivery notes, telegrams or telefax.
Documents proving the existence of the debt accompanied by documents
determining the existence of a commercial relationship between the parties.
Debts to the real estate ownership when certifications of non payment have
already been issued.

According to the rules of this proceeding, after the service of the writ of
summons, the defendant has the opportunity to pay the debt or to oppose within
the period of 20 days. If there is no response of the debtor the proceeding
continues as an “Executive proceeding” and if the defendant’s opposition is
placed in the court, the proceeding goes on as a verbal or an ordinary
proceeding, depending on the amount of the claim.

“Cambiario”: claims which are supported by any of the following documents:

Bill of exchange.
Cheque.
Promissory note.

Executive proceedings: claims which are supported by any of the following
documents: Public deeds. Loan contracts.

A summary proceeding may take approximately eight-ten months, while an ordinary or verbal proceeding can take from one and a half to three years, depending on its complexity. If the court decision is appealed, proceeding may take an extra two-three years.


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Bubo Coromandus

Spanish to English
It worked! Aug 22, 2008

Just to report that my claim was successful and the debtor paid in full. I had a wait of 2 months before the court served the claim on the debtor.

The only "hitch" occured when, at the end of the 20-day period which the debtor is allowed, I telephoned the court and was told the debtor had not paid.

I waited a few weeks until I had some money to pay a solicitor, then I found one. She made enquiries with the court, and was told the money had been received in full. (Unfortunately, I had not thought of checking again with the court whether the money had been received before instructing the solicitor.)

Using the power of attorney which I had sent her, she obtained the money and transferred it to me less the fee for her work.

Tip: if I were doing this again, the only thing I would do differently is that, supposing you are told that the debtor has not paid during the 20-day period allowed, you ask very pointed questions of the court, in case the payment has been received but information has not yet been registered in your file. Leave it a while if necessary and then ring again and ask them to check very carefully whether the payment has been received.


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Irena Dukoska
Local time: 00:49
Japanese to English
+ ...
China Sep 1, 2008

I will appreciate if someone can tell something more about debt collection in China.

Thanks


Irena


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Cristiana Coblis  Identity Verified
Romania
Local time: 01:49
Member (2004)
English to Romanian
+ ...
Debt collection procedures - several EU countries and US Sep 2, 2008

FIT Europe had a project on this subject and they collected an impressive amount of interesting documents from a number of countries: Austria, Belgium, France, Germany, Israel, Italy, Poland, Spain, Switzerland, UK and USA.

You can find the debt collection procedures for these countries on FIT Europe's web site: www.fit-europe.org under Bad Payers > Material received. Most of them are in English or/and French.

HTH


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Jana Součková  Identity Verified
Local time: 00:49
English to Czech
+ ...
How can I force an Israelian company to pay my invoice? Sep 3, 2008

Hi everybody,
I really don´t know what to do. I did a very long and difficult translation for an Israelian company, they were satisfied with my work, so I sent them my invoice but since then everything went wrong.
I reminded them maybe 30 times to pay, I sent them my invoice 3 times upon their request, when they excused that the accountant was out or that the contact person was out and postponed the payment, I was patient.
Then they said that they can´t make regular bank transfers and suggested payment via Western Union. I agreed and gave them address of WU in my city. They stopped replying my emails and I had no news from them for 2 weeks. Then they said the only possible way for them was PayPal or Moneybookers. I created a Moneybookers account, though I won´t use it in the future and sent them all details. I got no answer, so I sent it again. Since this time they are ignoring my emails.
The payment is more than 3 months late now and I am desperate, as it´s a 1 month salary for me and I am a single mother.
Can somebody help me or give me advice what I could do?
I will appreciate all suggestions. Thanks!
Jana


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EL Cavanaugh
New Zealand
Member (2008)
English to Finnish
Where is this link? May 26, 2015

"You can find the debt collection procedures for these countries on FIT Europe's web site: www.fit-europe.org under Bad Payers > Material received"

I do not seem to find it. I would like to find out the debt collecting procedures in Estonia and Netherlands.


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SwedishTra
United States
Local time: 15:49
Member (2007)
English to Swedish
+ ...
Resources for debt collection May 27, 2015

http://www.fit-europe.org/en/what-we-do/completed-projects/debt-collection-procedures

This is the link I found after some searching.


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