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Legal actions if foreign agencies do not pay? Mission impossible?
Thread poster: Peter Berntsen (X)

Peter Berntsen (X)  Identity Verified
Sweden
Local time: 10:05
English to Swedish
+ ...
Jul 14, 2014

As a freelancer, you often get requests for smaller jobs from agencies around the world. You can of course check the Blue Board at Proz and similar sites, but sometimes you have to just trust people (my personal opinion, though sometimes I feel silly).

However, sometimes this trust is not rewarded. My questions is, what legal options do I, as a freelance translator, have when it comes to agencies in other countries that do not pay?

I would like to hear your tips (if any), also on how to avoid potential non-paying agencies!


 

Paulinho Fonseca  Identity Verified
Brazil
Local time: 05:05
Member (2011)
English to Portuguese
+ ...
Legal actions if foreign agencies do not pay? Mission impossible? Jul 14, 2014

Dear Peter,
I am actually thinking I will experience that soon.

I have a client that is still sending replies to my emails, but they don't talk about a due date.

I have searched and written to some staff at Proz to ask for advice on that issue.

As soon as I get answers I will let you know. I chose not to mention 'their' names yet and see what the outcome will be.


That was a good post from you.

Good luck.

icon_smile.gif


 

Steven Segaert
Estonia
Local time: 11:05
Member (2012)
English to Dutch
+ ...
Different options - from business to legal Jul 14, 2014

You can take all sorts of action, from a gentle nod, over naming and shaming, to legal action. What is effective depends on the client and where you are located.

Many countries have small claims procedures, and there is a European payment order. This site has a blue board, and there are all sorts of lists clients and agencies don't want to be mentioned on. And as long as you haven't signed over the rights to your translation, it is perfectly within your rights to tell anyone it may concern that they can't use your unpaid work.

I personally have a strategy for how to deal with clients who do not pay as agreed.

I would suggest you make such an objective decision tree that fits your own situation. It helps to keep these things in the office and out of your personal life.


 

Helena Diaz del Real  Identity Verified
Germany
Local time: 10:05
German to Spanish
+ ...
I also have the same problem... Jul 14, 2014

Hi Clleagues,

I also have the same problem.

There is an agency in GB which is not willing to pay the due amount. This agency even said that my job was gorgeous, but about 5 months after I sent the invoice, I heard nothing from them. The eMails I wrote got no answer, but I know they are still assigning jobs.

Right now I have begun legal steps from Germany, where I live, but I don't know how will this end, nor if this will lead to a positive end. So I'm very much interested in what you say about this.

BTW: The agency has an excellent rate on Blue Board...

All the best,
Helena


 

Steven Segaert
Estonia
Local time: 11:05
Member (2012)
English to Dutch
+ ...
European small claims procedure Jul 14, 2014

These might help:

http://europa.eu/legislation_summaries/consumers/protection_of_consumers/l16028_en.htm

http://ec.europa.eu/enterprise/policies/single-market-goods/fighting-late-payments/index_en.htm


 

Andrea Halbritter  Identity Verified
France
Local time: 10:05
Member (2014)
French to German
+ ...
Get paid before you start... Jul 14, 2014

Why don't you trie to be paid before you begin the job?

Most of my clients are willing to pay at least 50 % before we start...


 

Sheila Wilson  Identity Verified
Spain
Local time: 09:05
Member (2007)
English
+ ...
Rights vs practicalities Jul 14, 2014

Peter Berntsen wrote:
My questions is, what legal options do I, as a freelance translator, have when it comes to agencies in other countries that do not pay?

I'm no lawyer, but I believe that, as a provider of a professional service issuing a legally enforceable invoice, you have an absolute right to payment for your (acceptable quality) work, whatever the legislation(s) involved. And I think the same rights apply the world over, in theory. But that's theory, and getting the money can vary depending on where each party is, with procedures being more or less lengthy and/or expensive.

Of course it's easiest when you're both in the same country, and simplest of all is when you're in the same town, but that's quite rare for us translators. If personal measures fail (including knocking on their door where practical and sending registered final demands), then there are small claims courts, at least in the countries I know. Even if both parties are in different EU member states, there are the very simple and cheap SCC procedures that Steven has mentioned; the only drawback is they seem very slow. Legal procedures between two countries with no such links will be more expensive, but I believe they are always possible. You'll need to retain a lawyer with the appropriate knowledge at the very least.

The other option is to deal with a specialist firm. There are international debt recovery companies and smaller ones based in each country - you will need someone who has a presence in your client's country. I've not had any personal experience of them but I believe they normally charge a percentage (around a third?) of what they recover.

As a freelancer, you often get requests for smaller jobs from agencies around the world. You can of course check the Blue Board at Proz and similar sites, but sometimes you have to just trust people.

Not just "can"; you "must" check the Blue Board if you want to reduce your risk to a manageable level. And that's only one resource you should be using. For a start, you need to be absolutely sure they actually exist. Many countries have their official company records on-line and you can also check the outsourcer's phone number, postal address (look for it on Google Earth etc), IP address... There are good tips on the scam centre here, which links to the risk management wikis: http://www.proz.com/about/translator-scam-alerts/

Then you should check their web reputation generally, not just on the BB. And if you aren't to sure, engage them in a few more emails to get a feel for their relationships with their suppliers. With experience comes a nose that can sniff out a good proportion of unwise collaborations.

But a certain element of risk will always be present in a freelance business relationship; that's businessicon_smile.gif. Once you've reduced it to your own acceptable level (which should include thinking about how much you can risk losing as well as the likelihood of losing it), you just have to make up your mind to risk it or pull out. If you can't reduce the risk to a level you can accept then that decision surely has to be a refusal.


 

Joakim Braun  Identity Verified
Sweden
Local time: 10:05
German to Swedish
+ ...
Small claims procedures Jul 14, 2014

Peter Berntsen wrote:

what legal options do I, as a freelance translator, have when it comes to agencies in other countries that do not pay?


The same options as any other company in any other business whose customers don't pay.

The same options as your utility company has, for instance. If you don't pay your utility company, you're not going to end up on some Blue Board - you're going to end up in court. So look up small claims procedures in the EU.


 

Peter Berntsen (X)  Identity Verified
Sweden
Local time: 10:05
English to Swedish
+ ...
TOPIC STARTER
Problem is smaller translations! Jul 14, 2014

Some useful,advice from colleagues, thank you!

I always ask EU customers for their VAT number. Checking this number on the VIES portal is a good safety precaution. Checking their hompage also is good, plus the Blueboard etc. entries.

Also, no problem in my own country, here we have good functions no matter what the amount.

But, the problem I am really concerned with is small jobs for companies that DO exist and look like they have an ok record, but they still do not pay (not common, at least not for me, but it happens every now and then).

Most jobs of this type are very small, maybe a couple of hundreds of EUR. A small amount means that you cannot use any of the services offered, since this would autmatically cost you more money than you can ever gain.

I lean towards asking for advance payment for all jobs from agencies from certain countries, 100% for smaller jobs and at least a large percentage for bigger jobs.

The alternative would be to simply stop accepting smaller jobs, there is a good case for this, since I have done some calculations that show that the smaller the job, the smaller the profit per hour (on avergae).


 

Sheila Wilson  Identity Verified
Spain
Local time: 09:05
Member (2007)
English
+ ...
The loser (aka your client) pays all costs Jul 14, 2014

Peter Berntsen wrote:
A small amount means that you cannot use any of the services offered, since this would autmatically cost you more money than you can ever gain.

False (in all cases that I know of). Often for the simpler on-line procesdures you only pay less than 50€. Anyway, costs are always awarded - you don't end up out of pocket. I did use the French SCC, byt the way - my client not only paid my invoices but also all the costs incurred by both of us (for the court itself, bailiffs, etc, etc), plus interest. Nowadays, he'd pay other things too. The only thing I didn't get was reimbursement of postage and photocopying expenses, and I didn't get paid for the time I spent on it.

The alternative would be to simply stop accepting smaller jobs, there is a good case for this, since I have done some calculations that show that the smaller the job, the smaller the profit per hour (on avergae). [/quote]
False logic, IMHO. What if the company goes bankrupt taking thousands of your money with it?


 

José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 05:05
English to Portuguese
+ ...
Yes, Mission: Impossible (or as costly as the movie) Jul 14, 2014

If you smell a rat, ask for 50% up-front with the order... via an irreversible and verifiable payment method.

For instance, PayPal is owned by and intended for eBay. Hence the buyer/client/payer can merely claim "I didn't get the goods" and reverse the transaction within a few weeks. If you have a verified account there (i.e. bonded to a bank account or credit card), and have already withdrawn the funds, they'll immediately charge you that amount.

Western Union may "jam" a transfer if the sender has done it online and failed to confirm by phone. So you'll get the MTCN, but you won't be able to get the money. After a while, the payer will get a refund.

A wire transfer may be considered 100% safe after the funds have hit your bank and been credited to your account, not before that.

A bona fide client, as long as they perceive you as a bona fide translator, won't refuse to split the risk on a first job by paying you part of it in advance.

If the job is small, and the client chooses not to pay after delivery, legal fees will certainly exceed the amount receivable.

On the other hand, if the job is large, some milestones (partial deliveries and payments) should be mutually agreed, otherwise it would be normal to expect that you will go broke/starve before finishing it.


 

John Fossey  Identity Verified
Canada
Local time: 02:05
Member (2008)
French to English
Copyright infringement Jul 14, 2014

Don't forget that a translation is intellectual property and copyright infringement - which is in fact what it is if a client uses a translation that they haven't paid for - is a criminal offence. Once or twice I have used that threat as a last recourse with a non-paying client and got quick results. Theft of intellectual property is a big deal these days and few companies want to run the risk of the police turning up.

In researching what I could do about one non-payer, a very large end client who obviously thought they had it all over a small translator, I discovered that my local police force has an "Intellectual Property Crimes Squad". A simple mention of that brought very quick payment.

[Edited at 2014-07-14 23:46 GMT]


 

Little Woods  Identity Verified
Vietnam
Member
English to Vietnamese
Can you post complaints about them on online alert websites? Jul 15, 2014

For your case if law doesn't work out well or it is not to the point of using laws, I found some websites like complaints.com, informercialscams.org, planetfeedback.com and thought they can be a place to report bad business but they seem to be for customers more than us service providers. Do you think we could use them? Is there any other universal website like that for freelancers since a country law may not work for citizens of a different country.

 

The Misha
Local time: 04:05
Russian to English
+ ...
Picky is the word Jul 15, 2014

Maybe you simply shouldn't jump at every stinky little job from the other end of the globe where for all the practical purposes you have no legal recourse whatsoever. I know I don't.

[Edited at 2014-07-15 04:34 GMT]


 

Peter Berntsen (X)  Identity Verified
Sweden
Local time: 10:05
English to Swedish
+ ...
TOPIC STARTER
Re. smaller/bigger jobs Jul 17, 2014

@Sheila: bigger jobs is a different story, if the amount of work is substantial, you can can justify spending time checking the client out, and also, asking for advance payment of part of the amount will be ok for all serious clients.

It is all about overhead, for smaller jobs I cannot take the time to check anything, checking the Blueboard and that the VAT number is OK takes no time, but the rest is not Worth the effort. For a bigger job, I can do some web research and also ask colleagues.

Also, the point you made yourself about not getting paid for the time you spend is good. But, it is also a matter of principle, so sometimes you want to spend some time just to show that it is not ok to cheat people....

What I meant re. the smaller jobs is that the overhead (invoice, e-mail, setting up tools, handling files etc.) makes them less profitable. Obviously the risk increases, but the time and Money spent on checking out that the Customer is ok is a much smaller percentage of the total amount.

Anyhow, I am done with smaller jobs. It is just not worth the trouble and the risk.

@The Misha: I am impressed, you managed to express your arrogance and your sense of your own superiority in a single sentence. *applause*


 
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