The collection of debt in China can only be performed by accredited Chinese law firm or by licensed specialists in the field. This type of action falls into the category of legal services and it can only be performed by accredited professionals. Foreign investors who need assistance with collecting debts or securing any due payments can address our lawyers in China who can offer debt collection services. It is important to know that debt collection in China can only be performed through legal entities registered in the Chinese territory.
| Quick Facts | |
|---|---|
| Who can contact our debt collection lawyers in China? | Natural persons and company owners who want to recover money from debtors |
|
Types of debt collection in China |
Through the amicable procedure or court proceedings |
|
Legislation |
– Contract Law, – Civil Procedure Law |
| The first step in debt recovery | Payment notifications are sent first. |
| Amicable collection of debts |
A new payment agreement can be settled if debtors respond to the amicable procedure. |
| Debt recovery in the court of law |
The court can enforce a payment order which enters into force immediately. Seizures of assets can be imposed. |
| We can prepare cases for further legal actions (YES/NO) |
YES |
| Negotiations |
With the help of our Chinese lawyers when new payment terms can be settled |
| New payment schedule proposed |
Possible |
| Is the amicable procedure available in bankruptcy cases in China? (YES/NO) | NO |
| The time frame to recover debts in China |
A few months or years, depending on the case |
| Customized approach |
Our debt recovery lawyers in China can propose suitable strategies to collect the debts. |
| International cases of debt collection |
Legal advice and representation are offered to our customers. |
| No-win no-fee services |
Clients pay for our services only when the debt recovery case is closed and the money is collected. |
| Why work with our law firm in China? |
We assist clients, local and international, in recovering debts through available procedures. Contact us for a free case evaluation. |
Table of Contents
When is it the case of debt in China?
The relationship between business partners and/or clients can deteriorate over time if the debts are not paid in due time. Such a situation can occur for various reasons, but most of the debts are caused by unpaid contractual provisions – one of the parties can’t or refuses to pay in accordance with the terms of the contract signed by the other party. Unjust enrichment or poor management of a business, as well as management without a mandate, can also be probable causes for debts in China.
How does the debt recovery process take place?
The debt recovery procedure starts by addressing a letter to the debtor. As such, the amicable recovery of debts starts. The debtor or the indebted company is informed about the existing debts towards the claimant and, if the debtor is responsive, our law firm in China can start the negotiation process with him in order to obtain the payment in the shortest amount of time possible. Our Chinese attorneys will also perform a deep background check on the debtor in order to establish the business relationship that developed between the two parties and analyze the current debts. If, however, the debtor does not respond to the letter, then our lawyers will begin the necessary legal procedure to bring the claim to court.
What types of debts can be met in China?
Rental payments, mortgages, loans, unpaid bills, or consumer credits are among the debts subject to recovery in China. If you face this kind of challenge and if you need to recover the debts of your company, we invite you to address your inquiries to our Chinese team of lawyers. We mention that the debt collection in China respects the international rules and regulations linked to this matter.
The amicable recovery method in China
The situation described above, where the parties can meet and negotiate over the payment of debt, is considered to be the amicable procedure. In this matter, the following stages need to be considered as part of the amicable recovery method:
- an amicable strategy in which the debtor gets a payment notification (via email or post office);
- the debt collection agents will then contact the company subject to the debt;
- the debtor and the creditor will be in touch during the entire debt collection procedure;
- the recovery of debts is made with respect to the applicable legislation in China.
If this phase is unsuccessful, our attorneys in China can provide the company’s management with other solutions, such as litigation or arbitration. The latter is a preferred method, based on consultation and a previously signed arbitration agreement, rather than taking the decision to commence a lawsuit. At the same time, the procedure is applied for the benefit of both parties, due to the limited time in which the decision is taken.
Debt collection in the court of law in China
There are quite a few situations in which the amicable procedure for recovering debts is not an optimal solution. In this case, debt collection comes to the attention of the authorities, respectively in the court of law. Here, a decision can be made regarding the debts to be paid. Seizures can be placed on assets and salaries until the debt is extinguished. It is good to know that the decision taken in the court of law for a debt collection case is imposed immediately. There is also the possibility in this case to establish new payment terms between the parties involved. We recommend you talk to our attorneys in China and learn more about debt recovery in the court of law.
Working with a debt collection agency in China
Debt recovery in China can be done with the help of an agency that deals with this. Practically, the specialists from the debt collection agency in China offer specialized representation to those interested in recovering money from debtors, analyzing each case with the utmost attention. The amicable procedure of debt collection is the first option offered, but there are also situations where the solution is decided in a court of law. We invite you to collaborate with our lawyers at our debt collection agency in China and learn more about how to recover your money.
We invite you to watch a comprehensive video about the debt collection methods in China:
China is the largest debt collector in the world
The latest data show that China is the world’s largest debt collector. Here are some interesting numbers in this sense:
- According to data for 2023, more than 25% of the world’s bilateral external debt was payable to China. This is why the country is considered the leading debt collector in the world.
- Around CNY 17,827 trillion in outstanding external debt designated in both domestic and foreign currencies was recorded in China in the same year.
- Around CNY 7819.7 billion was the outstanding medium- and long-term external debt of China.
- China’s outstanding debt of general government totaled around CNY 3034.6 billion, in terms of institutional sectors in 2023.
In addition to legal help for debt recovery in China, our specialists can also help you in other situations. You can opt for our services if you are interested in immigration to China. Our lawyers can help you obtain residency in China. Moreover, foreigners who already live here can apply for citizenship in China if they want to receive this status. We also offer legal representation for couples who want to get a divorce in China. As for the business environment, we recommend our legal services for trademark registration in China. Whatever the situation you have to solve, you can contact our law firm in China.