Below, our law firm in Switzerland explains how debt recovery is completed in this country.
| Quick Facts | |
|---|---|
| Specific applicable law | Federal Act on Debt Enforcement and Bankruptcy. |
|
Other specific regulations that apply (YES/NO) |
Civil Procedure Code. |
|
Types of debts that can be chased in Switzerland |
Debts incurred by natural persons and companies. |
| Availability of out-of-court procedures (YES/NO) | Yes, amicable debt recovery is available in Switzerland. |
| Court proceedings available (YES/NO) |
Yes, court proceedings may also be used to collect a debt. |
| Specialized authorities (if any) |
Debt Collection Office and Bankruptcy Office. |
| Courts in charge of debt collection procedures |
Cantonal courts. |
| Duration of amicable debt recovery process in Switzerland (approx.) |
Amicable procedures can be completed immediately or in a few weeks, depending on the arrangements with the debtor. |
| Time frame to pay a debt when reaching a settlement |
One to two months, depending on the canton. |
| Duration of debt recovery through court application (approx.) | Procedures can take up to 2 years. |
| Recognition of foreign court orders related to debt collection (YES/NO) |
Yes, in accordance with the Lugano Convention. |
| Possibility to use the services of debt collection agencies/lawyers (YES/NO) |
Yes. |
| Availability of debtor protection measures (YES/NO) |
Yes, Debt Collection Offices may impose debtor protection measures. |
| Debt collection services available (YES/NO) |
Yes, you can rely on our Swiss lawyers for debt recovery services. |
| Types of debt collection services available | You can rely on our law firm for assistance in amicable debt recovery and representation in court proceedings. |
Table of Contents
What are the types of debt recovery procedures in Switzerland?
There are two types of debt collection processes that can be completed when it comes to outstanding payments:
- the amicable procedure, which can be completed with or without the intervention of a third-party (Swiss lawyers, debt collection agencies);
- the court proceeding, which implies taking a case to court, just like in any other trial.
What are the debt collection steps in Switzerland?
The following:
- try to reach an agreement with the debtor;
- ask for the support of a Swiss law firm or debt collection agency;
- the third party will try to contact the debtor via email, phone, and even traditional mail;
- sending out dunning letters is also part of the amicable debt collection process in Switzerland;
- in case these steps fail, the creditor has the right to seek compensation with the Debt Collection Office or the court of law, depending on the canton.
Below, there is also an infographic on this subject:
What is the amicable debt recovery procedure in Switzerland?
This can be done by sending notifications to the indebted and trying to establish a system of payments through installments or prolonging the period of time necessary to pay the debt.
If the payment is made in installments, a period of time must be decided, which will usually not exceed 3 years.
Can I start the debt collection process myself in Switzerland?
Yes, this is often the case with companies with unpaid invoices. However, this is not a debt collection procedure itself; it is more trying to reach an understanding to avoid the actual recovery process.
How do I know that it is time to ask for professional help to recover a debt?
Amicable debt collection usually starts after not being able to reach an understanding with the debtor.
What are the ways in which I can contact a debtor in Switzerland?
There are 3 ways:
- by telephone;
- by post;
- via email.
IMPORTANT! In the case of communication made via post or email, it is recommended to keep the letters sent, as they can be used as evidence in the case of court proceedings.
Can I start legal proceedings without going through the amicable debt collection phase in Switzerland?
No, you must first try to reach a payment agreement with the debtor.
Do late payment penalties apply in Switzerland?
Yes, according to the Civil Procedure Code, the late payment penalty is 5% of the entire amount. However, there may be cases where the contract stipulates another percentage, in which case the latter will be applied.
What are the steps for court debt collection in Switzerland?
Here they are:
- the creditor must submit a request with the debt enforcement office;
- then, a payment order is issued and sent to the debtor;
- the debtor has the right to file an objection, without indicating any reason;
- the creditor must then submit the claim to a Swiss court to continue the proceedings.
IMPORTANT! The debtor must file the objection within a maximum of 10 days from receiving the payment order. If not, the claim will be enforced.
Here is our video about debt collection in Switzerland:
What court must I address when filing a debt recovery claim in Switzerland?
You must file the claim with a cantonal court.
How long do debt collection procedures take in Switzerland?
Amicable procedures can be completed quite fast, sometimes even in one month, if the debtor show good faith and agrees to repay the outstanding amount.
In the case of court proceedings, they can take:
- 2 to 3 months, in the case of uncontested claims;
- up to 3 years, in the case of a contested claim.
Who supports the costs of the debt collection procedure?
These usually fall on the debtor.
For clients concerned about international debt collection, we highly recommend our partners from other European countries such as our law firm in Poland.
We are also at your disposal if you want to open a company in Switzerland. Also, if you need, we provide assistance in opening Swiss bank accounts as well.
Please contact our Swiss law office for more details related to debt collection in Switzerland.