Overseas Debt Collection: How to Recover Money From Foreign Debtors

Your client is 4,000 kilometres away, in a different time zone, operating under different laws, and hasn't responded to your last six emails. Your domestic solicitor has written an excellent letter that arrived in Spain with the legal force of a suggestion. Your accounts receivable team is running out of escalation options because every option they have was designed for debtors in the same jurisdiction.

This is the fundamental problem with overseas debt collection: the tools that work domestically don't work internationally. The solution isn't trying harder with the same tools — it's engaging different tools designed for the jurisdiction where the debtor actually sits.

Why Domestic Collection Methods Fail Internationally

No enforcement mechanism. Your domestic court judgment isn't enforceable in Spain (with limited EU exceptions). Your domestic solicitor's letter has no legal consequence in Spain. Your accounts receivable team's phone calls create no pressure because the debtor knows you can't act from where you are. The fundamental asymmetry: your leverage is in your country, and the debtor's assets are in theirs.

Language and cultural barriers. A demand letter in English from a London law firm lands on a Spanish debtor's desk as a curiosity, not a threat. A phone call in English to a Spanish accounts payable department gets routed to whoever happens to speak English — who may or may not have authority to authorise payment. Language matters because enforcement matters, and enforcement happens in the debtor's language.

Legal system ignorance. Spanish debt collection has specific tools (monitorio procedure, burofax demands, debtor registries) and specific timelines (5-year statute of limitations for commercial debts) that your domestic team doesn't know about. Without this knowledge, your collection efforts are generic where they need to be specific.

How Overseas Collection Actually Works

Step 1: Engage a local agency in the debtor's country. For Spanish debts, this means a collection agency based in Spain with Spanish-speaking staff, physical premises, and the ability to file in Spanish courts. Not an agency that "covers" Spain from your country through a referral network — an agency that operates in Spain.

Step 2: Amicable collection. The local agent contacts the debtor directly: phone calls in Spanish, formal demands via burofax (Spain's certified mail with legal weight), and field visits to the debtor's registered office. This phase runs 30–90 days and resolves the majority of commercially viable debts. The agent works on no-win, no-fee terms — you pay commission only on recovered funds.

Step 3: Legal escalation. If amicable efforts fail, the agency's attorneys file a monitorio payment order in Spanish courts. This fast-track procedure produces enforceable judgments in 30–45 days for uncontested claims. Contested claims proceed to full civil proceedings (6–18 months). Legal costs are separate from the amicable phase commission and should be clearly agreed before filing.

Step 4: Enforcement. Bank account garnishment, asset seizure, property charges — all executed through Spanish courts by the agency's legal team. You don't need to travel, appear in court, or engage additional counsel.

Choosing Between a Local Agency and a Global Network

For debts concentrated in Spain, go direct to a Spanish agency. The collection quality will be higher, the communication will be faster, and the total cost will be lower. A global network agency adds a coordination layer that makes sense if your debts span many countries, but for Spain-specific debts, it's an intermediary that adds cost without adding capability. More on this decision here.

FAQ

Can I collect from a Spanish debtor without involving Spanish courts?

Yes — most commercial debts resolve in the amicable phase without court involvement. Professional amicable collection through a local agent resolves 70–85% of commercially viable debts referred within 90 days of default. Courts are the backstop, not the starting point.

What if the debtor has assets in multiple countries?

For EU debts, the European Enforcement Order and Brussels Regulation provide cross-border enforcement mechanisms. A Spanish judgment can be enforced in other EU countries (and vice versa) through established procedures. For non-EU enforcement, bilateral treaties and the Hague Convention may apply. Your agency should advise on the most efficient enforcement route based on where the debtor's assets are located.