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Tips For Managing Foreign Collections
16/07/2009
By Claire West
Legal action to secure payment from foreign debtors is on the rise according to Lovetts, one of the UK's leading debt recovery law firms. The number of Letters Before Action (LBAs) being issued on behalf of UK businesses to foreign debtors has increased 19% Q1 2009 vs Q1 2008. Furthermore, there has been a 39% increase in LBAs being issued to foreign companies on behalf of businesses in Eire during the same period. LBAs are used to secure payment, or to obtain a response from a customer before the commencement of a legal claim.
In the current economic downturn, the challenge for exporters is to ensure rigorous processes are in place to tackle late payment when the debtor may be on the other side of the world and operates in a completely different language. Lovetts is urging exporters to consider some simple tips to make sure they are prepared for any pre-legal or legal action they may need to take.
Trevor Philips, Director of Sales and Marketing for Lovetts says: "There are a number of key considerations to ensure your business is ready to deal with any potential disputes. While it's always good to be positive and hope that debt issues won't occur, the reality, as our analysis has shown, is that late payment is entirely probable and debtors may try to use distance and language barriers to their advantage.
LOVETTS' TIPS FOR MANAGING FOREIGN COLLECTIONS
Don't let language be a barrier
- Agree which language will be used for the contract and subsequent communications
- Ensure that when chasing payment you will be able to do so in your mother tongue. This needs you to identify your key contacts in advance.
- Remember that if you litigate, documents may need to be translated and personally served on the debtor
Do it by... continued on page two >
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