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Debt Collection in the UK for EU Companies

If you are a business-man dealing with companies at home or abroad, you are probably well aware that the possibility that your customer does not pay what due is always just around the corner. What to do then when dealing with a debtor with a company’s seat abroad? Obviously policies and laws about debt recovery vary from country to country; today we are going to focus our attention on British legislation, where economic crisis led to an exponential increase of payments delay.

Debt collection in the UK is a totally different game. UK debt collection procedure goes through some precise steps. The debt collection process can be divided into two stages. During the extrajudicial phase, collection takes place without Court intervention. During the judicial phase, we do involve the Court. Because we are a law firm, we can assist you during both stages. Most matters are resolved during the extrajudicial phase, without Court intervention. We are going to analyse hence the procedure to be followed when facing a defaulting debtor:

1. Written demand letters and phone calls:

First step to undertake in default debt situation is to send the debtor a written demand letter and to establish a contact by telephone, requesting the payment of your claim within a few days. You should specify the total amount of the credit, with the advice that in case of non-payment you will take legal action, instruct a professional with therefore increasing costs for the debtor himself.

2. Announcing legal proceedings and Lawyer intervention

In case the debtor does not pay within a set period of time, we can, in consultation with you, commence legal proceedings, as often, announcing legal proceedings will convince your British debtor to pay. We highly recommend you to start to take actions as soon as you can. Our firm, due to an extensive experience in the field can surely provide you with a valid legal support. Through our British department and skilled English-speaking professionals, debt collection lawyers, we have the capacity to handle your case, cost effectively and rapidly. Reaching a settlement is a very popular means in the United Kingdom to encourage your customer pay.

3. The collection procedure

Debt collection in the UK follows the same logic of other country’s ones. There is however a crucial difference between Italian and British approach to debt recovery, concerning party’s positions. In fact, under the Italian system, some instruments have been created in order to protect the creditor, whether British laws have a more neutral approach. Both parties are indeed call to defend their own position. There are four possibilities to take when trying a recovery:

* Extra Judicial Debt Recovery.

Once instructed a lawyer to assist you, this will use their knowledge of the customs of trade and regulations to arrive at a settlement with your debtor. Besides other way is to go for an Alternative dispute resolution (ADR). This is a cheaper, faster and easier way to settle disputes without Court intervention, for instance with mediation. Which method of ADR is right for your case largely depends on whether the debtor is willing to engage, and the type of contractual relationship you have; we can help you to pick the right one for you.

* Judicial Debt Recovery.

Judicial Debt Recovery can pass through court procedure. If the debtor does not pay within a set period of time, indeed legal proceedings can commence. Our firm can provide you with information in advance regarding the potential costs, and we only proceed after obtaining your permission. We have the following options to proceed against your debtor:

* European order for payment proceedings

In the event of an undisputed claim between two parties – when based in EU Member States – the path to commence European Order for Payment proceedings opens up. The lawyer handling your case can assess whether this kind of procedure is suitable in your case. In this circumstance, the procedure is the following: the creditor usually completes a standard form and submits this to the Court, then the Order for Payment is issued. Issued the Order, the debtor has 30 days to state whether to object to the claim. In case of lack of response within the due period, you may ask the Court to make the order for payment final (“declaration of enforceability”). The order is a valid and enforceable judgment and accepted in any Member State. Please notice that the European Order for Payment is never appropriate for disputed matters. The advantage of this procedure are speed and low costs, but also it has the disadvantage that if a credit becomes disputed, the procedure comes to an end and an ordinary civil procedure will have to be started if the creditor wants to continue.

* Ordinary civil proceedings:

“Small claims”: Claims smaller than £10,000 are dealt with as ‘small claims’. Usually, hearings are not as long as those for higher value claims. Sometimes there is no hearing at all. One disadvantage is that the costs of these proceedings are rarely charged to the losing party; “Fast track”: These proceedings are used for higher value, non-complex claims (usually up to £25,000). These proceedings tend to take more time than ‘small claims’. Also, the court will sometimes order that at least part of the costs of the proceedings should be paid by the losing party. However, the amount is at the discretion of the Court;

“Multi track”: Claims larger than £25,000, or particularly complex cases, are dealt with in ‘multi track’ proceedings. On average, these proceedings take longer, with the final hearing usually lasting more than one day. There is a greater willingness on the part of the Court to order that the losing party has to pay the costs of the proceedings, although again, the amount is at the discretion of the court;

4. Winding-up / bankruptcy petition

Unlike in other European countries, petitioning for bankruptcy is not very fast or cheap in the United Kingdom. It is seen as a ‘last resort’ in the debt recovery process. UK bankruptcy procedure takes several months and is quite expensive. Therefore, it’s crucial to discuss whether this is right for your case with a Solicitor.

5. Advice on debt recovery in Italy

If you have any further questions regarding debt recovery in Italy, please do not hesitate to contact our Italian department or send an email to, we will offer you legal assistance and guidance for settling rapidly and cost efficiently.

Kenton & Miles Legal offers a full range of debt collections options for Italian debts across Italy, through an international network of experienced and skilled Italian debt collection lawyers, English-speaking Italian professionals, therefore if you need more information about debt recovery in Italy, our team is at your disposal. You can contact our offices calling the number +39 091 625 88 54 or e-mail us at

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