How to Get Help in Collecting International Debts
Collecting international debts is a complicated process due to the collection laws between countries. At the time of this writing the U.S. has collection agreements with most European countries, Canada and some Asian countries. When performing a due diligence on a particular country it is necessary to determine if there is an agreement and if the country in question has any laws on their books the make debt collection possible. If the amount owed is substantial a consultation with an international collection law firm may be advantageous even if you decide not to retain the firm.
The International Professional Debt Collection Process
With globalization, countries have developed a growing interdependence as a result of the ever-increasing integration of trade and people in a single, global marketplace. Investment borders are opening up and financial flows can now be made with the click of a button. But while it's getting easier to trade across borders, it's still tough to set things right when payments don't come through.
Examine the amount you are owed by the company operating outside of the U.S. The most economical and expedient method of collecting your money is to sell the receivable to a Professional Debt Collection Company within that country or a Professional Debt Collection Company that has branch offices in the country where the debtor lives.
You will not receive 100% of the debt you are owed. This is a fact. Prior to searching for someone to purchase your receivable you need to establish your break-even point. This is the cost to manufacture, produce and ship the product to the end user. If you are on a 50% margin, you need half of the receivable to break even.
You will not receive 50% of the debt. A receivables purchase will give you pennies on the dollar. It is in your best interest to shop around for the best sales price. While you are not being paid the full amount, you will be paid something. Plus, you do not have to worry with the particular customer further.
An International Lawyer would handle Large Debts
For very large debts your best option is to hire an International Attorney. Just like suing a company state-side, this will be a long and involved process. The attorney of record must be totally knowledgeable about the collection process in the country you are dealing.
When suit is filed the local courts will usually assign an accounting agency to handle and disperse international debts. If this is the course of action you decide is right for you and your business, one suggestion is to determine whether the attorney is willing to add his fees into the total debt. Otherwise, hourly fees will be expensive as will filing fees.
In the case of hiring an attorney, there are no guarantees. You may win a judgment only to find that the debtor is insolvent. Again, you may have to settle for a portion of the entire debt. What portion of the debt will pay for your break-even point plus attorney's fees?
While the debt is large, the only guarantee you will have in collecting an International debt is to sell the receivable to the highest bidder.Ready to Compare Collection Agencies Price Quotes?