The recovery of an unpaid claim in Switzerland may be approached by multiple avenues, from a simple letter of demand to enforcement proceedings under the DEBA. An effective strategy takes account of the debtor's solvency, the nature of the claim and the deadlines to be respected. PBM Avocats assists companies and individuals in recovering their claims in Geneva, Lausanne and internationally.
Amicable Phase: Letter of Demand and Negotiation
Before initiating a formal procedure, the amicable phase is often the fastest and least costly. It begins with a formal letter of demand — ideally by registered mail with acknowledgement of receipt — which demands that the debtor pay their debt within a specific period (art. 102 CO). This step triggers default interest if the claim is enforceable and formally starts the payment period running.
The letter of demand may be accompanied by a settlement proposal: instalment payment, partial remission in exchange for prompt settlement, or assignment of assets in payment. A well-drafted settlement agreement, with a penalty clause and express acknowledgement of the debt, constitutes a title for provisional lifting under art. 82 DEBA, which considerably simplifies subsequent collection if the debtor fails to respect the agreement.
DEBA Enforcement Proceedings: From Payment Order to Seizure
If the amicable phase fails, the avenue of enforcement proceedings under the DEBA opens. They begin with the filing of an enforcement request with the competent enforcement office, which issues a payment order (art. 69 DEBA). The debtor has 10 days to file an objection (art. 74 DEBA).
In the absence of an objection or after judicial lifting of the objection, the creditor requests continuation of the proceedings. Depending on the debtor's status, the proceedings continue by way of seizure (art. 89 et seq. DEBA, for non-commercial natural persons), by way of pledge realisation (art. 151 et seq. DEBA, if the claim is secured) or by way of bankruptcy (art. 159 et seq. DEBA, for traders and legal entities).
Precautionary Measures: Attachment
When the debtor is domiciled abroad or risks concealing their assets, attachment (art. 271 DEBA) allows their assets in Switzerland to be frozen before any proceedings on the merits. This measure is particularly useful in the Geneva financial market, where many foreign debtors hold bank accounts or shareholdings in Swiss companies.
Attachment is ordered by the court upon the creditor's request, without hearing the debtor beforehand. It must be quickly validated by initiating enforcement proceedings or court action. Our lawyers manage the entire attachment procedure, from drafting the request to validation and realisation of the assets.
International Collection and Applicable Conventions
For the collection of claims involving foreign elements, private international law and international conventions play a determining role. In Europe, the 2007 Lugano Convention allows the mutual recognition and enforcement of civil judgments between Switzerland, EU member states, Norway and Iceland. A Swiss creditor may thus enforce in France or Germany a judgment rendered by a Swiss court, and vice versa.
For third states (outside the European Union and the Lugano Convention), recognition of a foreign judgment in Switzerland is governed by arts. 25 et seq. PILA and requires demonstration of additional conditions (jurisdiction of the foreign judge, respect for the right to be heard, absence of incompatibility with Swiss public policy). PBM Avocats coordinates these cross-border procedures and collaborates, where appropriate, with foreign correspondents.
Frequently Asked Questions on Debt Collection
What is the first step in debt collection in Switzerland?
The first step is generally a formal letter of demand sent by registered mail, setting a reasonable period (generally 10 to 30 days) for payment. This step is often sufficient to obtain amicable settlement, notably when the debtor is acting in good faith and the non-payment results from an oversight or temporary difficulty. The letter of demand also allows, under Swiss law, default interest to accrue (art. 102 CO) if this is not already the case under a contractual clause.
Is it necessary to first obtain a judgment to collect a debt?
No. In Switzerland, thanks to the DEBA, a creditor may directly initiate enforcement proceedings (payment order) without first having a judgment. If the debtor does not file an objection or if the objection is lifted, the proceedings result in seizure or realisation without any trial on the merits having been necessary. A judgment is only indispensable if the debtor files an objection and the creditor does not have a title for lifting (acknowledgement of debt, pre-existing judgment).
What is the Lugano Convention in international debt collection?
The 2007 Lugano Convention, binding Switzerland, the EU, Norway and Iceland, governs international jurisdiction and the recognition of civil and commercial judgments. It allows in particular a judgment rendered in an EU member state against a Swiss debtor to be recognised and enforced in Switzerland, and vice versa. For states not parties to the Lugano Convention, recognition of a foreign judgment in Switzerland is governed by arts. 25 et seq. PILA, with less automatic conditions.
How to collect a claim against a debtor domiciled abroad but holding assets in Switzerland?
The attachment mechanism (art. 271 DEBA) is the preferred tool in this case. A creditor may request the attachment of assets that a foreign debtor holds in Switzerland (bank accounts, shareholdings in Swiss companies, real property, etc.), even before having a judgment. Once the attachment is obtained, it must be validated by enforcement proceedings or court action. PBM Avocats has experience in attachment procedures involving foreign debtors active on the Geneva financial market.
What strategy to adopt when facing an insolvent debtor?
When facing a manifestly insolvent debtor, the strategy depends on the nature and amount of the claim. For small claims, procedure costs may exceed the expected recovery, and a transactional negotiation at a reduced price may be preferable. For significant claims, it is advisable to assess the debtor's real assets, consider attachment of identified assets, and file a claim in bankruptcy if it is opened. A certificate of loss, even if unsatisfactory in the short term, allows proceedings to be resumed as soon as the debtor acquires new resources.