Debt Recovery Services for Luxembourg
The staff of our Debt Collection Agency is trained to retrieve money from customers that are hard to deal with; we will contact the debtor using our strong but diplomatic techniques and make sure your unpaid accounts are quickly sent to your bank account.
Here below you will find a detailed explanation on how we collect debts and both amicable and legal steps we are following.
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We usually contact the debtor the same day of account placement.
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1.1 Amicable Phase
1.1.1 General
ebt Collection Agency Service Luxembourg seeks to maintain a professional approach to collections throughout the entire process, focusing primarily on maintaining a sound relationship between our creditor and the debtor who we are pursuing. We maintain an entirely in-house collections staff, ensuring that the process is controlled and assuredly high quality. Our collection experts will contact debtors via telephone and via written correspondence to their primary residence or their main business address.
If a dispute does arise between a debtor and one of our clients, it is the policy of Debt Collection Agency Service Luxembourg to review every existing contractual document, invoice, and prior communication, in order to find a reasonable settlement that will please both parties. In the event that legal action must be pursued to recover a debt from a debtor, our in-house legal team will handle the process of discovering the debtor’s information and taking the appropriate action against them.
Debt Collection Agency Service Luxembourg strictly follows all state and federal laws in the country, and makes sure to adhere to all European Union regulations that govern collections and legal proceedings against debtors.
1.1.2 Local agent
In some cases, our oral and written communication efforts fall short of achieving the desired outcome for our clients. When this happen, Debt Collection Agency Service Luxembourg resorts to local agents who can visit debtors at their main business address or at their primary place of residence. The goal of these visits is to determine the debtor’s financial situation and assess their assets, largely to determine exactly how to proceed through the process.
Our field agents will report back to Debt Collection Agency Service Luxembourg any information they do discover during a field visit, and that information will help to guide our next course of action. Field agents also produce an extensive summary of the debtor’s business operations, if necessary and relevant.
1.1.3 Interests
It is the policy of Debt Collection Agency Service Luxembourg to always attach an interest payment to outstanding debts collected by our professionals. We do this by following one of three guidelines set by our clients and European Union regulations:
– Our first course of action is to examine the contract that currently exists between the creditor and the debtor. If the contract specifically states an amount of interest that should be charged on late payments and collected debts, this is the amount that will be charged by our collectors.
– If we cannot find any information within the existing contract about the interest rate that should be charged, we will move to charge an interest rate that has been stipulated by European Union regulations. This rate will be a flat 12 percent figure.
– If the interest rate stipulated in the creditor’s contract is below 12 percent, it is the policy of Debt Collection Agency Service Luxembourg to charge the 12 percent rate instead of the lower one agreed to by the debtor and creditor at the outset of their business relationship.
Collecting interest on top of an existing debt can be exceedingly difficult in Luxembourg, and therefore the attachment of any interest to a debt is often viewed more as a negotiation tactic than as a realistic fee charged to the debtor.
1.1.4 Debt collection costs
There are two ways that collection costs are charged to debtors by Debt Collection Agency Service Luxembourg. First and foremost, our company adheres to European Union regulations when charging these fees. That means that each debtor will be charged a flat rate of 40.00 EUR for an outstanding debt that our collectors are pursuing. On top of this amount, it is the policy of Debt Collection Agency Service Luxembourg to enforce a 10 percent penalty clause when collecting a debt. That 10 percent is calculated based on the full outstanding balance of the debt itself.
1.2 Legal Procedures
1.2.1 General
In Luxembourg, legal proceedings to cover debts and receivables are based in regulations set forth by the Civil Code of Luxembourg, as well as by pieces of the country’s Commercial Code and its Judicial Code. All three codes are typically applied in tandem, with small pieces of each code governing the proper collection of a debt via trial, lawsuit, and notification to the debtor.
Debt Collection Agency Service Luxembourg pursues debtors through several different court systems in Luxembourg. These venues are differentiated based on the amount of the claim being filed against the debtor, as well as the debtor’s place of residence within the country.
1.2.2 Required documents
In order to file a lawsuit against a debtor, it is necessary for Debt Collection Agency Service Luxembourg to be in possession of several documents. These documents are used to prove the claim’s validity and to help fend off a dispute that might be filed by the debtor:
– Copies of all invoices
– Copies of the terms and conditions, as agreed by both parties
– Original Power of Attorney, signed by the client Debt Collection Agency Service Luxembourg is representing
– Copies of the original contract
– Copies of delivery notices, orders, and order confirmations
– Copies of any notices or payment reminders signed by the debtor upon issue
If the debtor files a dispute during the legal period, Debt Collection Agency Service Luxembourg will require additional documentation of any correspondence that has occurred between the parties. Witnesses and experts may also be needed to help prove the validity of the claim being lodged by our client against the debtor.
1.2.3 Legal dunning procedure
Luxembourg requires the Justice of the Peace to launch the summary procedure against the debtor. This procedure is not always the best course of action when recovering debts and receivables, and can be ineffective for a few key reasons:
– The creditor’s claim must be undisputed
– The claim cannot exceed a maximum of 10,000.00 EUR
– The formal conditions needed in order to lodge such a claim are rather particular and extensive, often requiring proof of the capacity of the person who will be signing for the creditor, as well as requiring a large number of documents to prove the claim’s validity
1.2.4 Lawsuit
Lawsuits in Luxembourg are able to take on two very different forms, with different possible outcomes and durations. The first is the Summary Procedure, which is easily the most popular way to pursue legal action against debtors in the country. It is also the quickest way to ensure payment is made by the debtor. A second procedure, known as the Substantive Procedure, is far more complex and extensive. There is no written intervention, and the case can become seriously defended and needlessly complex if the debtor does file a dispute against the creditor.
1.2.5 Costs
Obtaining a summons and inscription in the court’s calendar will cost clients roughly 250.00 EUR. The cost for indemnity of procedure is not fixed, and can vary on a case-by-case basis depending on the case’s duration and complexity. Court costs are, in most cases, able to be charged to the debtor. The court will need to agree that such charges can be issued to the debtor, however, and some judges have been known for forcing the creditor to pay such charges. Legal fees and the costs of representative in the court will vary based on the size and scope of the case itself. These costs cannot be charged to the debtor.
The cost of enforcement in Luxembourg depends heavily on how the bailiff has to proceed in order to enforce a judgment. Simple procedures will be relatively affordable, while longer and more complex enforcement requirements will result in a far higher cost of enforcement overall.
It is the policy of Debt Collection Agency Service Luxembourg to provide an estimation of legal costs only on a case-by-case basis, due largely to the variable fees levied by the judicial system in Luxembourg.
1.2.6 Expected timeframe
As with virtually every case, enforcement of any outcome varies a great deal. The expected timeframe of any outcome depends heavily on the debtor’s compliance, and the bailiff seeking the enforcement. In the best case, enforcement will take about four months. In complex cases, they can take up to 12 months or even longer.
1.2.7 Interests and costs in the legal phase
After legal action has begun against a debtor, the interest rate applied to the outstanding balance of the debt is stated is included as part of the amount owed to the client by the debtor. This is as stipulated either in the terms and conditions between both parties, or as stipulated in the agreement between Debt Collection Agency Service Luxembourg and our client. The court can, at its discretion, modify the interest rate to be lower than the rate agreed to between Debt Collection Agency Service Luxembourg and the debtor. The interest rate can also be completely eliminated if the judge feels it will help the debt be collected in a more expedient fashion.
A penalty clause is also claimed in the balance owed to the creditor by the debtor. Just as the interest rate can be modified or eliminated by the judge, the penalty clause amount can also be reduced by the judge or eliminated entirely during the course of legal proceedings against the debtor. This is especially the case when the debtor has not signed any terms and conditions document with the creditor.
In accordance with European Statute 2011/7/UE, Debt Collection Agency Service Luxembourg also claims a 40.00 EUR fee as part of the balance owed by the debtor, regardless of the size of the debt. This fee is rarely modified or eliminated during legal proceedings.
Whatever the debts reason, we will work it, fast.
As debt recovery agency, we’ve seen of the disputes and excuses debtors say when they fail to payback our Clients.
We know how to rreply and negotiate, using the right level of pressure and get you paid quickly.
