Debt Collection in Denmark

The debt collection process in Denmark.

“The amicable phase” of debt collection in Denmark.

When your invoice against a company in Denmark is due, the first step is to send a formal reminder letter to the debtor. Minimum 10 days need to be set as new payment deadline before further actions can be taken.

The reminder letter is has to be sent to the debtor before sending the case to a debt collection agency.

When the time limit for the reminder letter has expired, the debt collection process can begin. Debt Collection Agencies in Denmark need permission from the Danish authorities to carry out their business.

Collection demands are issued and the debtor is informed that the next step in the process is to proceed with legal action.

Judicial debt collection in Denmark.

Sometimes it may be necessary to go to court with your debt collection case in Denmark.

Civil cases can be brought to district courts by individuals and organizations to settle their disputes with another party. The party who proceeds with a civil action is known as the plaintiff. The party who is being summoned is the defendant.

There are 24 district courts in Denmark. When in doubt, all legal disputes start in one of the district courts. In exceptional cases, the district court can transfer a civil case to the high court if the case has to do with legal standards of general interest.

“Order for payment”.

This is an alternative procedural path a creditor can take that is a lot smoother and quicker than the usual court procedure in the district court.

With a “betalingspåkrav” (demand for payment), you get the bailiff’s assistance to recovert debts of up to DKK 100,000.

On the off chance that somebody owes you money, you can get the court’s assistance to recover the sum by transfer your demand for payment with your nearby district court. It is the bailiff’s court that handles the case.

You can use this alternative path (betalningspåkrav”) when you have a reasonable assumption that the debtor will concur that he owes you the sum. Be that as it may, the debt may not surpass DKK 100,000 excl. litigation costs and interests.

What compulsory information do I need to provide? The demand for payment must, in addition to other things, contain data about the parties names and addresses, your case and information about how the case emerged.

If you have indicated this on the “order for payment” application, the bailiff’s court may:
– Ensure that the verdict you get from the “betalningspåkrav” has the same judicial effect as an ordinary judgment from court.
– Transfer your Danish debt collection case to ordinary civil court proceedings in Denmark if your Client (the debtor) contest the debt.

What does it cost? At the point when you present the demand for payment to the bailiff’s court, you should likewise pay a court fee. The court expense relies upon the size of the claim amount, your choices in the application order for payment, and the time-course of the case.

Enforcement of claims in Denmark.

On the off chance that a private individual or an organization owes a debt to somebody, the individual to whom the debt is owed (the creditor) can bring the case to the Enforcement court – if the other party (the debt holder) refuses to fulfill their obligation.

To be able to take a claim in a debt collection case in Denmark to the Enforcement court, you need a so-called execution title. In a Danish debt collection context, this means a judgment from the court. Either through the ordinary legal proceedings or through an Order for payment.

An enforcement procedure means that the debtor’s assets are distributed by the Enforcement Court to the creditor.

Insolvency procedures in Denmark

In the event that an organization gets into monetary challenges, a liquidation can guarantee that no creditors are unfairly treated.

The court can start liquidation procedures against a debtor in case its insolvent (and can’t satisfy its obligations as agreed upon) and one of the Creditors, files a request for bankruptcy.

The courts don’t start insolvency procedures themselves, and bankruptcies must only be raised if the debtor can’t pay.

In the event that there are other reasons why the organization doesn’t pay, the case must then be treated as a debt collection case in Denmark and go through the process of “betalningspåkrav” or alternatively as an ordinary civil dispute in the district court.

When a company is in bankruptcy proceedings, the company loses its ability to manage the company’s money and assets itself. A legal counselor is officially appointed as a trustee, who should try to make an outline of the organization’s overall debt. The trustee should likewise figure and sell the organization’s resources and assets. The sum of money that the trustee is able to raise is conveyed to the creditors.

How to petition for Bankruptcy? You can fill in your information in a form, which you should ship off to the probate court in the area where the debtor is located.

A bankruptcy request should be composed as a hard copy and should include the name, address and CVR number of the debt holder. You should likewise compose how much the organization owes and for what it is due. Furthermore, you should provide your own name, phone number and address.

In case an organization declares financial insolvency, a document of assets, resources and liabilities (values and liabilities) and a rundown of creditors should be attached.