7 EFFECTIVE WAYS TO COLLECT DEBTS IN DANANG 2023

Debt recovery

Debt collection in Da Nang is the application of methods, measures to request the debtor to pay debts when they are due, overdue to be paid in accordance with the contract, as agreed between the parties, or as decided by the competent state agency. Phong & Partners would like to send you 7 effective ways to collect debts in Da Nang 2023.

1. Debt collection activities

Any company running a business cannot avoid accruing debts over the course of operations. If the company does not maintain good management, the significant amount of outstanding debt will have a direct impact on the capital and finances of the company.

Effective debt collection involves legal expertise, debt management experience, and other abilities that not all businesses can provide on their own. So how can you rapidly and lawfully recover debts?

Debt collection activities of the Enterprise are the application of methods and measures to request the debtor to pay debts when they are due, overdue to be paid in accordance with the contract, as agreed between the parties or as decided by the competent state agency.
Debt collection for businesses is a crucial, necessary component of corporate operations that helps to maintain stability and profitability. If the debt collection process is poorly handled, this will have a significant negative impact on the enterprise's long-term and sustainable development, especially:
- Firstly, businesses have a lot of expenditures to cover when they first start up, including labor costs, material prices, product costs, operational costs, equipment costs, and costs associated with running the firm. It will be exceedingly challenging to meet the budget if the enterprise has a significant amount of outstanding debt and insufficient cash to handle it, preventing it from continuing operations and having viable business goals.
- Secondly, It is likely that the enterprise will borrow money from banks or other lending organizations to address emerging issues when the capital source is not assured to support the operation. Therefore, you should be concerned about more than just the loan interest. If your business is not operating efficiently, it may not be able to make payments on time, which could push it into a category of bad debts. If this happens, your business may be placed on a “blacklist”, making it more challenging to continue borrowing money from banks or other businesses. More dangerously, the Enterprise’s collateral may be liquidated in this situation. Due to their inability to pay their obligations due to the enterprise’s unrecoverable debts, many businesses may fail.
- Thirdly, when the company's debt issues are resolved, it will be able to maintain a stable operating environment and develop financial and business plans that are appropriate for the circumstances surrounding its business operations. This will allow the company to balance its financial resources and grow significantly.

2. 7 effective ways to collect debts in Da Nang 2023

There are many effective and legal forms of debt collection, each with different advantages and limitations. Therefore, each Enterprise needs to have an understanding and apply appropriate forms of debt collection to achieve the best efficiency. Phong & Partners mentions 7 effective ways to collect debts in Da Nang 2023.

(1) Debt reduction: For those partners/clients who are having difficulty in paying debts or have repayment conditions but hesitate to pay due to part of the debt as interest arising from the late payment of goods, services or fines for breach of contract, the creditor Enterprise may consider reducing the debt part for them (reducing the arising interest, fines for breach of contract or part of the principal debt) provided that they must pay the remaining debt immediately, or pay in installments according to a reasonable plan. In this case, although the value of the debt may be reduced, the clients/partners may be more willing and cooperative in repaying the debt, thereby saving costs and time to collect the debt.
(2) Sending dispatches, debt collection letters with a flexible way before the dispute occurs: Sending official letters and debt collection letters is also an effective way to collect debts. Depending on each partners/clients, each situation, each debt, the text may show a willingness to debt collection and the desire to maintain a good relationship with the partner/clients. For reputable partners/clients who wish to cooperate long-term, they will be willing to fully pay the debt to the enterprise. Or text showing harsh content or creating strong pressure to force the partners/clients to perform the obligation if the case has been reminded many times but not paid.
(3) Negotiation: This is the preferred method to use when starting to carry out debt collection because this is considered a quick and low-cost method. With this method, the two parties will conduct negotiations to find the most appropriate treatment for the debt depending on the actual capabilities of the parties. Creditor enterprises can apply options such as reducing interest rates, offsetting debts, extending the deadline for payment of debts in goods... to motivate partners/clients to quickly pay debts. However, in order to negotiate effectively, the negotiator must have both knowledge and skills in debt collection, and be skillful flexible to achieve the highest efficiency.
(4) Initiating a lawsuit to the Court or Arbitration Center: When partners/clients are uncooperative, evasive, or have large debts, this is an appropriate and effective solution in handling and collecting debts. This is a measure that will put significant pressure on partners/clients, especially partners/clients who are still in business as usual. One of the main advantages of this method is that temporary emergency legal measures can be applied, in order to prevent the debtor from evading the obligation such as sealing or not transferring assets, freezing bank accounts or prohibiting some people on the board of the debtor to exit... This method requires the creditor enterprise to gather sufficient legal evidence and of course will cost both time and court costs, and implementing this option, requires procedural knowledge and legal issues related to the content of the dispute.

In order to recover the debt immediately after the lawsuit is instituted, the creditor Enterprise needs to immediately carry out the procedures for requesting the enforcement of the judgment, tracing the assets and liquidating the assets of the debtor. Depending on the complexity and characteristics of each case, the process of judgment execution, property liquidation is fast or slow, easy or difficult. This stage requires the creditor Enterprise to have the knowledge, expertise to ensure effective debt collection.

(5) Requesting for declaration of bankruptcy of the debtor Enterprise: In case the amount of debt is large but the debtor is not able to pay, the creditor Enterprise should also consider the option of filing a petition for opening insolvency proceedings with the debtor. At that time, the creditor enterprise will have the opportunity (however small) to collect a part of the doubtful debt by conducting the procedure to liquidate the remaining assets of the debtor according to the bankruptcy procedure.
(6) Retaining the prestigious unit providing debt collection services: In case the creditor enterprise does not have in-depth legal expertise in the field of debt collection, retaining prestigious unit to collect debt is also a useful solution. Specialized units involved in providing debt collection services to many clients, ensure extensive experience and expertise, have flexible collection methods, know the process and skills that can help enterprises effectively collect debt.
(7) Selling debt for professional and legal debt trading units: Debt sale for debt trading units is also one of the effective solutions to collect debts. The debt trading unit may prepay all or part of the debt of the debtor and all risks of non- collection shall be borne by the debt trading unit. Debt trading units have a professional way of handling debt, will save and shorten the debt collection time. However, for the Debt Trading Unit to approve the debt purchase, the debt profile needs to be fully legally guaranteed, and the debt collection fee is also quite high.

In addition, the Enterprise specifically notes, debt collection should not be obtained by resorting to gangsters because it is impossible to control the activities/acts of debt collection of gangs hired. In case these entities commit illegal acts against the debtor, the enterprise is not only at risk of not collecting the debt and cost to gangsters but also the risk of being jointly liable for civil liability if the debt collection acts violate the law or even the head of the enterprise can be jointly liable for criminal liability with gangsters.

3. Debt collection services for the Enterprises at Phong & Partners

Phong & Partners provides debt collection services for Enterprises with the scope of work as below.

Phong & Partners advises on issues arising in the debt collection process for Enterprises, specifically:
- Counseling and evaluating of debt collection dossiers and conditions;
- Counseling the Client on identifying debts, measures, business processes, debt handling procedures;
- Counseling complete legal documents on debts to ensure that there is sufficient legal basis to collect debts;
- Counseling on options for the Client to deal with in the case that the Partner/ Client is not in good faith at any stage;
- Counseling on other legal issues related to the debt collection process for Client such as counseling on processes, procedures for resolving debt collection disputes at the Court/Arbitration Center;
- Counseling on legal cost issues; settlement time...

Phong & Partners drafts documents arising in the process of debt collection for Enterprises, specifically:
- Drafting dispatches, announcements and related documents to request the partners/clients to pay the debt;
- Drafting lawsuit petitions, petition for the presentation of opinions and related documents when initiating lawsuits procedures to the Court or at the Arbitration Center to handle debts;
- Drafting the application for judgment execution, verifying the conditions for execution of the legally effective judgment;
- Drafting documents on the application of provisional emergency measures to prevent the debtor from shirking the debt repayment responsibilities or dispersing assets send to the competent court/judgment enforcement agency such as petitions for application of coercive measures, distraint of assets, freezing of accounts, prohibition of exit…;
- Drafting petitions and complaints when necessary;
- Drafting dossiers to request courts or competent agencies to settle petitions for declaration of bankruptcy of enterprises;
- Drafting other legal opinions to protect the interests of Client at The Courts/Arbitration Centers and agencies, organizations and individuals involved in the case resolution process.

Phong & Partners represents/defends the interests of the Enterprise throughout the debt collection settlement process.
- Representing and/or joining the Enterprise during the negotiation and mediation process with the partner/client with soft measures, avoiding conflict or strong and drastic negotiations when the partner does not have a cooperative attitude to repay the debt;
- Representing Enterprises work with competent state agencies, relevant agencies, organizations and individuals to request coordination in the process of debt collection;
- Representing/participating in the defense of legitimate rights and interests for Enterprises in The Courts/Arbitration Centers when disputes arise;
- Representing the Enterprise in the process of judgment execution to request the judgment execution agency to issue a decision to execute the legally effective judgment;
- Representing the Enterprise in coordination with authorities to implement debt collection measures such as asset declaration, freezing of bank accounts, prohibition of exit…
- Representing the Enterprise to participate in the settlement during the process of requesting the Court or a competent state agency to settle the petition for declaration of bankruptcy of the enterprise.

4. The cost of providing debt collection services of Phong & Partners.

Depending on the complexity of each case, Phong & Partners will offer the most appropriate fee of the counseling and participating Lawyer in representing/protecting the interests of the Client. Phong & Partners charges a fee for counseling and drafting documents according to the actual working hours of the Lawyer, especially when participating in representing/protecting the interests of the Client, in addition to fixed costs, We charge a success debt collection fee with the motto “no win – no fee”, that is, the fee depends on the actual amount of debt collected. All costs, remuneration to implement the work, We always ensure clear and transparent agreement when the Client comes to the Phong & Partners Law Firm.

With a dedicated way of working and always putting professionalism first, debt collection service - Phong & Partners always ensures debt collection in a legal, transparent manner and makes every effort to bring the best service to the Client. Phong & Partners has the flexibility to apply different collection methods and skills to effectively collect debt for the Enterprise, helping the fastest collection time and limiting to the minimum the possibility of conflicts arising between the Enterprise and partner/client.

Such above are all legal services that debt collection services will provide to Clients in the field of debt collection for the enterprise. If Clients need to use debt collection services, contact Phong & Partners immediately for counsel and solve your problem quickly, credibly and effectively.

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SYSTEM OF PHONG & PARTNERS LAW FIRM IN DA NANG

1. Phong & Partners in Hai Chau - Thanh Khe

Address: 6th floor, Thanh Loi Building, 249 Nguyen Van Linh, Thanh Khe district, Da Nang.

Phone: 02363 822 678 - 0905 102 425

2. Phong & Partners in Son Tra

Address: 01 Dong Giang, Son Tra district, Da Nang.

Phone: 0905 205 624

3. Phong & Partners in Lien Chieu

Address: 21 Truong Van Da, Lien Chieu District, Da Nang.

Phone: 0961 283 093

4. Phong & Partners at Ngu Hanh Son