Collection of claims from Germany. Check out the best way to recover your debts

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Collection of claims from Germany. Check out the best way to recover your debts

Foreign carriers performing transports on a given territory are a significant force in the European transport market. Sometimes, it is due to the best price-quality ratio. German companies often cooperate with transport operators from abroad. However, the problem may appear when the customer from Germany avoids paying the price for the transport service received.

In the transport industry, usually, there is no time to thoroughly check the business partner before starting the cooperation. Sometimes, the carrier places absolute trust in a foreign company. However, after the transport service is completed, they are left without a payment for their invoice, and their foreign business partner vanishes without a trace. With no response to their phone calls, e-mails and letters, the carrier becomes vulnerable.

Foreign debtors, undoubtedly, are the biggest problem of transport companies. This is the case because we lack effective legal tools debt recovery.

Application for an order for payment is the best option

Not always debt recovery has to be long and complicated. When comparing the process of debt recovery in the EU member states, Germany should get a positive assessment for its efficient court proceedings. It may seem scary if we do not know the German law and procedures or do not speak the language. So, it is recommended to trust a specialized debt collection agency or a law firm that has the experience with debtors in Germany. If the claim is indisputable, which means that our business partner did not make any complaint about the service, the chance to recover a debt is very high.

The German courts issue, within one month, a payment order which then should be effectively delivered to the debtor.

The faster the better

The German debtors usually do not respond to reminders and calls for payments from creditors from abroad. Very often, only after a German lawyer gets involved in the case, the debtors would pay to avoid the court payment order.

However, it is important not to wait too long before applying for an order of payment because the period of prescription pursuant to the CMR Convention is 15 months. And if the transport was performed within the territory of Germany, according to the German law, the period of prescription is only 12 months. After this time, the claim becomes barred by limitation, and the debt cannot be recovered.

So, when the debtor is not paying, you should start the debt collection proceedings immediately. The faster you sue the debtor, the better chances for the success. The advantage is that the order will be valid for 10 years, which additionally secures our claim.

How to get back the expenses

The assistance of a German lawyer in the proceedings to get an order of payment is not necessarily expensive. A material advantage of filing a claim is that the period of prescription ceases to run, and you may recover the whole cost if you win the case. Additionally, the creditor in such proceedings may claim compensation for delayed payment in the amount of 40 euro and due interest, pursuant to the provisions of the German Commercial Code.

Generally, lawyers’ fees in Germany are thought to be so enormous that they can even exceed the value of the outstanding amount. So, you should look for flexible solutions. One of the options is to hire a debt collection agency from your country which will cooperate with a foreign partner to recover your debt, at the same time, keeping affordable prices.

The problem of debt recovery in Germany is very common among entrepreneurs. It is important to remember that only the knowledge of the German market and legal system will make the effective debt recovery possible. With that being said, it is always advisable to be cautious when starting the cooperation with a foreign partner and use every available means to avoid problems.

Photo: Pixabay/TeroVesalainen

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