Having drawn from the expertise of Atradius Collections' local offices, the International Debt Collections Handbook explains the different regulations and procedures for debt collections in Germany.
Atradius Collections maintains a professional collection process, focusing on the relationships between our clients and their debtors at all times. Our team of collection specialists carry out the collection process in-house, contacting debtors both verbally and in writing whilst adhering to federal and state laws. When there is a dispute, we aim to reach an amicable solution between the creditor and the debtor. We do this by analysing all contractual documents (e.g. signed contracts, orders, confirmations, invoices and delivery notes, as well as all standard terms previously agreed upon). All investigations are completed with the assistance and agreement of our legal team.
Atradius Collections always charges interest to debtors, calculated from the base rate set by the German national bank plus 9% on a daily basis (see European Directive 2011/35/CEE Article 3 in conjunction with paragraph 288, section 2 of the German Civil Code). When creditors have to pay higher interest to their banks, we are able to ask for the higher rate. However, this rate needs to be confirmed by the banks in writing in case any legal action needs to be initiated.
From a cultural point of view, German debtors are used to paying late payment charges, although the actual amount of the interest payment is considered a matter of negotiation between debtors and collectors.
Debt collection costs
In Germany, under the German Civil Code paragraph 280, sections 2 and 3 and paragraph 286, debt collection costs are chargeable to the debtor, representing the creditor’s claim for late payment. If the creditor has a special contractual agreement, this can be taken into account as long as the debtor has previously agreed to the terms.
From a cultural point of view, German debtors are used to paying debt collection costs, though often the actual amount of these costs is considered a matter of negotiation. Atradius Collections will forward all recovered debt collection costs to our client to reduce the claim, retain the cost or add them to the success fee. This will depend on the contractual agreement between the client and Atradius Collections.
The Debt Collections Handbook presents a snapshot of Germany's economic situation and covers the following topics:
- Accepted and most common payment methods
- Types of companies
- Legal procedures & legal system
- Enforcement in debt, movable and immovable property
- Insolvency proceedings
- Pool of creditors
To read more about steps and procedures undertaken in debt collections in Germany: