Debt Collection in Russia
Does your company have to deal with debt collection in Russia because a Russian customer has not paid your invoice? Our Russian debt collection specialists and lawyers will be happy to help you. We ensure that your outstanding invoices are paid quickly. Read here what we can do for you when you want to hire a debt collection agency and recover debt from Russia.
"In Russia, there is no statutory payment term as opposed to many other European countries. The legislation surrounding debt collection is still in its developing phase."
International debt collection in Russia
When doing business with a Russian trading partner, you are confronted with different trading traditions and customs than those you are used to. Moreover, different legislation applies in Russia than in your own country. In addition, you will also be confronted with a different language. This often makes debt collection in Russia very complicated and time-consuming. That is why you should hire our Russian debt collection specialists. They have the means to get your debtor to pay.
Payment behaviour of Russian companies
- There are no legal payment terms
- The payment behaviour of many Russian companies is very poor
- A payment term of 14 days is customary in the case of reminders.
Debt collection in Russia
Russia does not have a legal payment term as opposed to many other European countries. The rules and regulations on debt collection are still in their developing phase. Most debt collection cases in Russia have a payment term of 30 to 60 days, however, a payment term of 90 days is also common. In many cases, Russian companies do not adhere to the agreed payment term.
In most cases it is difficult to determine the creditworthiness of Russian companies. In order to ensure the payment of your invoice, advanced payments are usually requested. Many companies prefer to pay in installments. It is very common to pay 30% of the payment at the time the order is placed and the remaining 70% once the goods have been delivered. If you are doing business with a Russian trading partner, our advice is to request an advanced payment to ensure the payment of your invoice.
Advantages of debt collection in Russia
- Russian debt collection lawyers in your country
- Russian-speaking lawyers
- Highest success rates of 95%
- Collection throughout Russia
- Always a single point of contact
- 24/7 online access to our portal
- No Cure No Pay debt collection
Russian lawyer in your country
It is best to contact a Russian lawyer or debt collection specialist to collect your invoice from your Russian debtor. You will not have to go to Russia for this, you can simply contact our specialists at Bierens. They have extensive knowledge and experience with the rules and regulations in Russia. Our debt collection specialists also collect in Russian, their native language. This way we can ensure that your Russian debtor pays as soon as possible.
Debt collection procedure in Russia
The debt collection process in Russia can be divided into two phases. In the extrajudicial phase, we collect without the intervention of the court, in the judicial phase we do involve the court to get your Russian debtor to pay. Because we are a law firm, we can assist you in both phases.
Written demand letters and phone calls
We will call your debtor and send written reminders asking your Russian debtor to pay. Your debtor will then be given several days to make a (partial) payment. In some cases, we may also talk to your debtor face to face.
Announcing legal proceedings
In case of non-payment, we can start legal proceedings. Often the announcement of legal proceedings will already convince your Russian customer to pay. It is therefore advisable to hire a debt collection lawyer as soon as possible to announce such proceedings on your behalf. This will prevent the debt collection process from taking longer than necessary. If your debtor refuses to pay in the extrajudicial phase, we can go to court in consultation with you. We will always inform you on the possible costs in advance and we will only process your case after receiving your permission.
Would you like to start legal collection proceedings against your Russian debtor? If so, the first question you will have to consider is, in which country should you litigate? In your country or in Russia? This depends on the competent court, i.e. the court that is competent to rule on your debt collection case.
In your general terms and conditions, you can make agreements on the competent court in the event of a (payment) conflict. This is also called choice of forum. Have no agreements been made? Then the main rule is that the court in the country of the defendant has jurisdiction. In this case the Russian court. You will then have to go to Russia to follow legal proceedings there.
In addition, the main rule is that the law of the country of the seller or service provider applies. In this case, the law according to your country. We then get this difficult situation where the Russian court must judge the case based on the law of your country, an unfamiliar legal system. This is not a desirable situation, which is why our advice is to make agreements about this in your general terms and conditions. You can also agree that you can litigate in your own country in the event of a conflict arise.
Debt collection laws Russia
When we take legal action against your Russian debtor, there are several debt collection laws that we can deploy. The most applicable debt collection procedure differ per case. Debt collection proceedings in Russia are much longer, and complex compared to other countries. In addition, the Russian legal system is also very complicated. That is why our lawyers will always thoroughly investigate which procedure is most applicable for your debt collection case.
Abridged procedure ("Приказное производство")
If there is no disagreement regarding the payment of the invoice, then we call this an undisputed claim. If the amount of your claim does not exceed a certain amount, a "Приказное производство" procedure can be initiated. With this procedure an enforceable judgement is obtained that is reasonably fast and efficient. After the judge has reached a verdict, our lawyers will immediately deploy the necessary means to execute this judgement.
Ordinary civil proceedings ("Исковое производство")
In case of a disputed claim, when your debtor disagrees with the invoice, our lawyers can submit a writ of summons ("Иск "). Both parties will then have to present their cases in court. In certain cases, the judge will reach a verdict immediately, while in others a date may be scheduled for a hearing. Depending on your case the lawyer will determine the best course of action and applicable procedure.
An outstanding invoice cannot be collected forever. At a certain point an invoice can become time-barred. Once the statute of limitations for your invoice has expired, you can no longer enforce the payment of your invoice through the courts. It is therefore important to keep a close eye on this limitation period.
In Russia, business debt collection cases are subjected to a 3-year limitation period. This period starts from the moment the claim has become due and payable.
Suppose you deliver a batch of clothing to a customer. On 1 April 2017 you send the corresponding invoice, with a payment term of 30 days. Your customer then refuses to pay. The due date of the invoice is 1 May 2017. The limitation period will then begin on 31 December 2017 and last for 3 years. On 31 December 2020, your invoice will become time-barred.
Exceptions to the limitation period
The limitation period of 3 years applies to regular business claims. Please note that the limitation period is different for certain claims. For example, transport law has a limitation period of 1 year. In addition, the limitation period is shorter for disputed claims and has a duration of 2 to 3 months.
Preventing prescription of your Russian invoice
You can avoid prescription of your invoice by interrupting the limitation period. By doing so, the limitation period is halted until it is initiated again. In Russia the statute of limitations can be interrupted if the debtor acknowledges the outstanding payment. For example, your Russian debtor may request to postpone the payment or pay in instalments.
Legal areas for debt collection in Russia
Our Russian debt collection agency has been active for several years. During this time, we have helped many companies all over the world with their debt collection business in Russia as well as several Russian companies with all kinds of debt collection cases in various jurisdictions:
- Buying and Selling
- Construction law
- Rental and leasing
- Agency and distribution agreements
- Damages and unlawful acts
“Bierens is a highly effective and professional partner. Not only do they have a good debt collection procedure, they also give solid advice.”
Manuel Maas, Eneco
Is your debtor located in Moscow, St. Petersburg or Novosibirsk? For our specialists, it does not matter where your customer is located. We can assist you throughout Russia. For the successful collection of your case, you do not need to hire a debt collection agency or lawyer in Russia. You can simply transfer your case online. Our Russian specialists will then get straight to work.
More than a debt collection agency
If you are looking for a debt collection agency, you are actually better off with a debt collection lawyer. Our Russian collection lawyers have more resources than a collection agency. Moreover, they work faster and are also more successful. This is beneficial for your organisation as you will quickly receive your payment.
No Win No Fee debt collection
During the extrajudicial phase, we work based on the No Win, No Fee principle. If we do not collect, then you pay no legal fee. You only pay €150 for administrative costs. After all, an unpaid invoice causes enough frustration. We think it would be unfair if you were to be faced with all sorts of additional fees.
You only pay a fee if we can collect the claim. We try to recover this fee from the debtor as much as possible. Therefore, a successful collection case will cost you almost nothing! That is what we call justice, as you will receive what you are entitled to.
If the collection is successful, we try to recover the collection costs from the debtor as much as possible. In that case, your Russian customer will pay the outstanding invoice and the collection costs. This way, you will pay little to no collection fees to our organisation.
Do you have an outstanding invoice with a Russian customer? Or do you have another conflict with your client? Our collection specialists and lawyers will be happy to help you solve your payment conflict. Please feel free to contact us for more information. Are you tired of waiting for your payment? Then transfer your invoice today. Our specialists will get straight to work for you.