Betreibungen - bills - poursuites

Debt collection agencies, dealing with bills and those naughty agencies that sometimes send you nasty letters.

Here is the basic process:

Bill send with date by which to pay.
Optional Reminder sent to pay the bill
Optional 2nd and often final reminder send to pay the bill often with a
charge SFr. 5-20 for late payment.

Optional Sent to debt recovery agency and lots of letters and charges!

Betreibung or Poursuite - the formal legal process to recover the money.

The important thing to note in the above process description is that many things that are assumed by many to be “their right” are actually not and legally as soon as the bill has not been paid and the date required for payment has passed you could have a Betreibung as the next step.

It is however entirely normal to receive a pleasantish reminder that you have not paid perhaps 2 weeks after the date of payment has passed. The second letter will probably not be so pleasant and include a request for an additional few francs for their trouble!

Thereafter if you are lucky comes a third reminder or passing directly to the fun part the inkasso bureaus. Apparently Intrum Justitia are the angels of this group and the way they work can best be described as blind. So in order to deal with this group you need to be aware of your rights and what you need to pay and what you definitely do not need to pay.

Legally there are two things you always need to pay.

  1. The main amount owed
  2. Interest on that amount at the rate of 5% - still I think but it might be more now unless this is otherwise set in the T&Cs of the company.

It is also possible and likely that to the original main amount you need to pay the amount billed for reminder charges in German Mahngebühr.

And that is more or less it.

However the debt recovery agency likes to make money so additional items appear on your “bill”…

Now what you definitely don’t need to pay are the kosts of the debt recovery agency. This is covered in Art 27. Abs. 3 SchKG which states that the costs of representing the debtee or creditor are not allowed to be passed to the debtor. In other words if the company engages a third party to recover its debts then they need to pay the third party and not you.

So from the written law these costs are not allowed to appear as a debt however you will see references to Art. 106 OR appearing on any letter from a debt recovery agency with sentences such as Verzugsschaden or Forderung gemäss Art. 106 OR.

Another trick is div. Auslagen or Rechsberaterkosten or Rechstauskunft or…
These are all things that are not permitted to be charged to the debtor according to the SchKG - I mean to actually need to take legal advice for debt recovery for a company specialised in debt recovery is blatent robbery - thats all they do…

Then there is the nasty Teilzahlungszuschläge. This effectively means that it is possible to repay the debt in parts and or at a later date effectively postponing the inevitable. However, if this is to be permitted it falls under the Konsumkreditgesetz or the law of consumer credit. The first part of this is the requirement for a bonitätscheck ie your ability to repay the debt. Is this not why you are here in the first place because you cannot? And if you can repay the debt then you would, rather than face the substantial costs of Teilzahnlungszuschläge. The effective annual interest rate needs to be made clear and when this is ca 50% you would not sign up for such a thing so it is surpressed which of course is against the law. Further you are not given the chance for early repayment again something which is not legal. All in all this is a pretty nasty business…

So what do you actually do. Firstly everything must be via Fax and or registered mail and you must keep a copy of everything…

  1. Request a copy of their power of attorney (right to represent the company in question). This is a legal requirement they must respond to. Inform them that until such document is provided you will enter into no correspondence with them and assume they have no legal right of representation.
  2. Calculate how much you owe the company and in a separate post calculate the interest due. It is not legal to add the interest to the main amount otherwise later amounts would be charged interest twice.
  3. Remove all positions that are irrelevant such as Div Auslagen, Rechstkosten, blabla gem OR 106.
  4. When the power of attorney arrives pay the amount as calculated in 3 to the account the debt recovery agency provided.
  5. Don’t let additional mails with additional amounts frustrate or annoy you - simply save them and otherwise ignore them.
  6. As soon as and assuming you receive a Betreibung you need to declare you will take the legal route as you owe nothing.
  7. That will generally be it as they cannot take it any further - well they can but they lose and you can recover your costs if they take it further.