How Much Do Boarders Matter In Debt Collection?

If you have a customer who owes you money and none of your reasonable efforts have been successful, it might be time to take them to court. No one enjoys taking a client to court, but it can sometimes be the only way to recover money that is owed to you. This gets a bit more complicated if your client is overseas, either in the British Isles or further afield. How exactly do you recover a debt from abroad, and what systems are in place to help you?

The United Kingdom

The UK court system, which is often used for debt recovery efforts, is relatively simple as these things go. The whole system is managed by by Her Majesty’s Courts and Tribunal Service (HMCTS), overseen by the Ministry of Justice. There are 2 main branches of the UK court system – Civil and Criminal. Debt recovery is dealt with on the civil side, while cases of fraud are delt with on the criminal.

The Civil courts are made up of:

• County Court
• High Court
• Court Of Appeal
• Supreme Court

While the Criminal courts are made up of:

• Magistrates’ Courts
• Crown Court
• Court of Appeal

Under UK law the Late Payment of Commercial Debt Regulations applies to England, Wales, Scotland and Northern Ireland. While there might be some subtle differences in terminology, all of these courts approach and apply the law the same way.

The British Isles & Crown Dependencies

Outside of Great Britain, right next door, there are 3 Crown Dependencies. These fall within the British Isles, and are linked to the Crown and the Monarch, but they are not linked to UK Parliament, and therefore not UK legislation either. Instead they are self-governing islands with their own courts and legislation, and only rely on the UK for defence of the islands. This means that The Late Payment of Commercial Debts Regulations don’t apply there. Instead, they have:

Bailiwick of Guernsey: A series of inhabited and uninhabited islands where the Royal Court of Guernsey is the head of the entire legislative system. A Petty Debt Claim in the Magistrate’s Court is the Guernsey equivalent of issuing a Claim in the County Court.

Bailiwick of Jersey: This jurisdiction contains a number of uninhabited islands as well as Jersey itself, which is home to more than 100,000 people. There they have The Royal Court of Jersey, which is the head of the entire legislative system. If you issue a summons through the Magistrate’s Court Greffe, it’s the equivalent of issuing a UK Court Claim. If that claim isn’t paid, then it will go to the Jersey Petty Debts Court, which is the equivalent of our County Court Hearings. Same outcome, just a different name!

The Isle of Man: Found an equal distance from England, Scotland and Northern Ireland in the Irish Sea. The Isle of Man has their own Courts of Justice, and they are the head of the entire legislative system for the island. It’s split into the High and Lower Courts, and they have their own Small Claims Court that you can obtain a judgement through for debt collection. The only real difference is that the SCC is found in the High Court, under the Civil Division.

Europe & The Rest Of The World

If both the creditor and the debtor are registered within the EU, then the process is managed through the European E-Justice Portal. This has a very similar structure to the UK County Court process, and can be worked through simply by both parties. However, since the UK is no longer a member of the EU, this means any UK business with overseas clients will need to approach things differently.

Across the world there are a wide range of court systems, procedures and laws, with no one-size fits all solution. The Late Payment of Commercial Debts Regulations only applies to the UK, and so you may need to enlist specialist help to recover overseas debts and country-specific legislation.

At Debtcol we pride ourselves on doing everything we can to recover your debts and return money owed to you – even if that means working alongside overseas governments. If we are unable to help you with an overseas debt, then we have connections with dozens of firms that specialise in international debt recovery who can. If you’re not sure, or want to find out more, just get in touch with the team today.