Every business at this time or another will have to go through a difficult situation when having to recover debts from its customers. The business management must understand how to conduct debt collection to comply with debt recovery rules in Vietnam in order to successfully operate an efficient business while minimising legal risks for the business.
Our lawyers are committed to helping clients comply with the debt collection rules which can be complicated and difficult without the legal assistance of professional debt collection attorneys in Vietnam. Vietnamese law makes it illegal for third party debt collectors who are authorised by creditors to violate or use unfair or disloyal tricks to recover debt from debtors. The Vietnamese law also prohibits debt collectors from participating in various forms of harassment, fraud, or threats, such as suggesting that they can arrest the debtors until the debt is paid off. Some common practices at the clients’ discretion to ensure efficient collection without breaking the debt collection law include:
Demand letter
When an account becomes overdue, the clients can perform debt collection actions. A series of demand letters, often including terms of agreed-upon payments, debtor’s debt acknowledgement, and threat of legal action can escalate the need to return the debt. The creditors’ potential litigation threat can act as a good start for a debt recovery process. An attorney with debt collection skills can help clients prepare demand letters that can be reused at the client’s discretion when necessary.
Settlements
If it is clear that the debtor is unable to repay the full amount owed, the clients may consider a reasonable payment according to the debtor’s finance capacity. The benefits of instant payments (discounts) can greatly outweigh the costs that the clients have to spend in order to bring the case further to litigation at court. A settlement agreement will be drafted by a professional debt collection attorney as necessary for the parties to show goodwill to resolve and release each other from their respective obligations in the debt collection case.
Debt collection service provider
If there is clear evidence that the debtor fails to pay the debts, the clients need to consider using the service of debt collection proceedings of a law firm specialising in resolving debt collection disputes.
Legal action
This is seen as a final measure of debt collection, which requires the clients to file a lawsuit against the debtor, requiring a significant amount of time for asset research, investigation, and acquiring debt related information. Before proceeding, the clients should ensure that the physical location and legal status of the debtor’s property and registered address of the debtor is correct to secure compliance with the filing process in accordance with civil procedural law.
The statute of limitations for initiating lawsuits in relevant jurisdictions is also a very important variable that the clients should consider. Additional requirements to file a lawsuit include written demand letters, submission of debt-related evidence, and participation in at least one confrontation and provision of evidence at court before the case is judged. Once the clients have secured a favourable judgment at court, the next procedural step is to request the competent enforcement agency to take the lien of the debtor’s property if the debtor did not voluntarily enforce the legally effected judgment. If you need further information on our debt collection services, please feel free to contact us by phone at +84 (28) 36223522 or via email at info@phuoc-partner.com.
