In a broad sense, what is the process involved in recovering an international debt? Switzerland is an important venue with regard to international debt recovery, since assets are frequently located in Switzerland (most often in the form of a bank account or securities located at one of the many Swiss banks, or international banks with offices in Switzerland). Swiss debt enforcement offices and local courts are thus very familiar with cases involving foreign creditors looking to enforce claims in this jurisdiction. Also, proceedings up until the court stages are simple and inexpensive as they involve primarily the debt enforcement office. Recovering international debts in Switzerland, however, presupposes some link to Switzerland. Such a link may take the form of assets maintained in Switzerland (i.e. bank accounts, securities, real estate or other fixed assets). Another point of connection may be that the debtor actually has its registered seat in Switzerland or – in the case of a natural person – is a Swiss resident. Where the debtor is resident or incorporated in Switzerland, debt recovery starts with the issuance of a payment summons against the debtor. This process is initialised by the creditor requesting the debt enforcement office at the place of residency or incorporation to issue a payment summons against the debtor. The payment summons contains the information about the debtor, the amount due and the reason for the debt (in summary terms). The summons requires payment within 20 days. Upon service, the debtor may contest the payment summons, but must do so within 10 days. Doing so 60 LAWYERMONTHLYMARCH 2023 Overcoming Hurdles in International DebtCollection in Switzerland Thought Leader As a financial hub, Switzerland is frequently involved in matters involving international debt collection. The debt recovery process necessarily involves in-depth fact-finding and additional concerns depending on the relevant parties’ attachment to Switzerland. In this feature we hear from Marcel Frey, counsel at Prager Dreifuss, who outlines the obstacles that can be faced during this process and offers his insights on how they can most effectively be tackled.
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