Overcoming cross-border barriers during bankruptcy
Besides dealing with language, cultural, and legal differences in international debt recovery, other issues may arise that you did not anticipate. Often, countries have different administrative procedures or systems that can delay creditors in recovering their payments.
In this case, a debtor went bankrupt and a curator hired our experts to collect the pending credits in Portugal. During the amicable debt collection phase, clear negotiations were made with the opposing lawyer. All that remained was to sign the settlement that would prevent any further legal action from taking place.
However, signing the settlement caused a delay that neither parties had expected. Because of the different signature authentication systems and ID verifications in both countries, signing the settlement became a lot more difficult and caused a major delay.
After representing the creditor for their claim and negotiating and drafting new agreements that were acceptable to all parties, it was just a matter of time before our client received their payment. We collected a total of €200.000,- of the principal amount. Our client (the liquidator) could recover the payment and improve the payment rate in the bankruptcy proceeding of the creditor.
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Although this is not a typical case whereby a debtor refuses to pay an invoice, it highlights the challenges when dealing with international debt collection. Anticipating cultural and legal aspects is one part, but there are also practical matters that can delay the process. Our lawyers can explain everything you need to know when dealing with international debt collection so you immediately know what you can expect. Contact us today for your free consultation.