Swiss creditors have a range of methods related to the debt recovery in case of bad payers. If they cannot obtain the debt through amicable procedure they can seek the help of a debt collection agency or a Swiss lawyers with these qualifications. An amicable procedure consists in trying to reach a settlement with the indebted without involving a third party (debt collection agency or a law firm). 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 don’t exceed 3 years.
Other method of payment can be the partial repayment, when the creditor accepts to give up a partial part of the amount from the debt with the condition of immediately payment of the rest of the debt.
The procedures which have to be completed before a debt is recovered by the agency begin with checking the availability of the debts. If the claim is justified, the debtor will receive a payment order, sent via post or by an official of the agency from the Debt Enforcement Office. In the request is stated the due amount and the procedure of covering the debts and the instructions for depositing a formal objection. The due claim has to be covered no later than 20 days from the notification. The claim can be contested by the debtors without providing a reason but no later than ten days from delivering the request. This formal objection can be dismissed if the creditors show that the debtor owns the debt.
If this step is not successful, the court proceeding may begin. The payment order becomes enforceable just like a court order if the debtor doesn’t file a formal objection and still doesn't pay the debt. If the debtor files a formal objection, the creditor must initiate a summary court procedure if he has an enforcement title or a written acknowledgement of the debt signed by the debtor.
If this step is not applicable, the ordinary court procedure can be initiated. In order to proceed, the creditor will need the due invoices, the proof that the invoices were received by the debtor.
There are three methods to obtain the coverage of the claims: by seizure of assets, by realizing pledged property and by the bankruptcy procedure. All these can be decided by the competent courts.
The application for bankruptcy can be filed by the debtor himself who can deposit it to the bankruptcy court. The court will initiate the bankruptcy proceedings only there was no prospect of an amicable settlement established with creditors. During the process, no debt collection measures may be taken against the debtor. Debts remain in the form of certificates of unpaid debt and after the bankruptcy proceedings have been closed, new debt collection measures can be brought against the debtor again if there are evidence that the debtor has accumulated new assets.
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