Collecting debts in Italy
Collecting payments or debts in Italy arising from international commercial transactions appears to be difficult and expensive. Depending on the amount of the debt, American and Extra-EU companies usually give up to start litigation, due to high fees that they expect to incur. On the contrary, the international law firmDamiani & Damiani knows that collecting debts in Italy can be very cheap, easy and fast. Whit the lawyers team Damiani&Damiani we can help significantly foreign companies to recoup their loss, collecting their debts with an expenditure of about 10 – 15 % of the total amount of the sought credit. Let’s see how.
Recovery fixed and payable credit (e.g. based on invoice)
When a credit is fixed and payable, i.e. based on invoices issued upon order, it is very easy (and fast) to obtain a judicial injunction in Italy. Within 30 days, a foreign company can obtain a provisionally enforceable order, with a cost of about 10-15% of the value of the credit (and even lower!), pursuant to Italian law.
All legal and court fees that the creditor has incurred to collect his or her credits, will be recapped mostly in full; as they are included by the Judge in the judicial order.
Once the creditor company obtains the required provisionally enforceable order, collecting the debt is even easier. In less than 40-50 days the debtor will find its bank account seized by the Judicial Authorities, to grant the sought payment, together with reimbursement of all the expenses the creditor incurred to obtain payment.
At that point, it is very likely that the debtor will start cooperating. If not, the enforcement procedure moves forward. The Judge will order to the debtors’ bank to pay the seized amount (expenses included) to the credit. Wire transfer is granted in 15 days.
Even when Italian debtor companies file for – or are forced to – bankruptcy, overseas creditors should not discourage. Bankruptcy does not always entail lack of money. Most of the time companies file for bankruptcy because they were not capable to administer their business and duly collect their revenues.
Bankrupted companies may have relevant credits to be collected for the assets. In any case, due to the principle of “par condicio creditorum”, when the assets is not satisfying for all creditors, their credits are satisfied equally, although only in part.
Hence, it is important for overseas creditors to expeditiously lodge an application to the bankruptcy procedure, in order to participate to the revenue distribution. However, due to the strict terms of application, and Italian proceeding rules, the aforesaid application should be lodged with the assistance of an Italian lawyer.
In fact, inexpert companies who file an application autonomously collecting debts in italy, may incur nullity, terms expiration and forfeiture for collecting debts. Moreover, credits may benefit privileges and may enable creditors to be satisfied before other creditors, in full, pursuant to Italian law.
The International law firm Damiani & Damiani suggests to accept legal assistance to file application to bankruptcy procedure. With assistance of the lawyers team Damiani&Damiani, any privileged credit will be promptly claimed, granting to our client the best satisfaction provided by law.
Let’s recap!
Collecting Fixed and payable credit (e.g. based on invoice) Collecting debts in Italy
- Remedy = provisionally enforceable Judicial order
- Issuance time = 30 days
- Expense = 10 – 15% total amount of the credit (and even less!)
- Recoup time = 90 days in total
- Recouped amount = credit amount + expenses.
Debtor company in bankruptcy
- Remedy = application to bankruptcy procedure
- Acceptance = 15 – 30 days
- Expense = 4 – 8% of the credit (and even less!)
- Recoup time = 6 months – 12 months
- Recoup amount = full credit if privileged; full or part of the credit; full or part of the expenses.
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