Debt collection in Algeria

The debt collection process in Algeria begins with a legal and financial analysis of the debtor, their actual business activity, company history, location of assets, ongoing court or enforcement proceedings, possible objections to the debt, and the quality of available documentary evidence. This analysis helps determine whether the case should proceed through amicable collection, ordinary court proceedings, an order for payment, proceedings before a commercial section, a specialized commercial court, forced enforcement, or, if the debtor has stopped making payments, judicial settlement or bankruptcy proceedings.

If the debtor continues business activity, has identifiable assets, and is not involved in a procedure that blocks or materially complicates payment, it is usually reasonable to begin with out-of-court amicable collection. This stage helps assess the debtor’s real willingness to pay, record the debtor’s position on the debt in writing, and prepare the evidence base if court proceedings become necessary.

Out-of-court amicable collection should begin with a written payment demand. The demand should identify the basis of the debt, the amount, the due date, the supporting documents, and the proposed deadline for voluntary payment. Communications by mail, email, phone, or messaging services can be useful for negotiation, but their practical value depends on the ability to prove the content of the communication, the identity of the person contacted, and receipt of the demand by the debtor or an authorized representative.

At this stage, the creditor may seek full or partial payment, a payment schedule, written acknowledgment of the debt, return of goods, legally permissible set-off, or another solution consistent with the documents in the file. The goal is not only to obtain a promise to pay, but also to preserve evidence that can be used if the dispute is later brought before an Algerian court.

The duration of amicable collection depends on the debtor’s response, the quality of the documents, the existence of a serious dispute, the ability to identify assets, and the possibility of quickly formalizing a written agreement. If the debtor does not respond, denies the debt, transfers assets, or uses negotiations only to delay payment, the creditor should proceed to judicial debt collection without weakening the evidentiary position.

For a foreign creditor, document preparation is especially important. Contracts, invoices, delivery documents, acknowledgments of debt, commercial correspondence, registration documents, powers of attorney, and foreign court decisions should be organized in a way that proves the existence of the debt, its amount, its due date, and the debtor’s exact identity. In Algerian court proceedings, documents generally need to be submitted in Arabic or accompanied by an official translation. Algeria deposited its instrument of accession to the Apostille Convention on November 5, 2025, and the Convention is scheduled to enter into force for Algeria on July 9, 2026; before that date, consular or diplomatic legalization may still be required depending on the type of document and the country of origin.

Before initiating judicial collection, the creditor should check the applicable limitation periods. Under Algerian civil law, the general limitation period for obligations is fifteen years, unless a special rule applies. Certain periodic and recurring claims, including rent, wages, salaries, pensions, and similar obligations, may be subject to a five-year limitation period. For a debt based on a bill of exchange, the basic claim against the acceptor is generally limited to three years from maturity. The period usually begins when the claim becomes due and payable. The statutory limitation period cannot be changed in advance by agreement of the parties, and the court does not apply limitation on its own initiative; it must be raised by the debtor or another interested person.

The limitation period may be interrupted by filing a claim, a payment demand in enforcement proceedings, seizure of property, filing the claim in bankruptcy or distribution proceedings, or another procedural act aimed at asserting the creditor’s right. It may also be interrupted by the debtor’s express or implied acknowledgment of the creditor’s right. After interruption, a new period starts running from the moment the interrupting act ceases to have effect.

Algerian law allows judicial debt collection mainly through ordinary court proceedings or, when the legal conditions are met, through an order for payment. In commercial disputes, jurisdiction may belong to the commercial section of the court or to a specialized commercial court, depending on the nature of the dispute. The specialized commercial court is particularly relevant for disputes involving commercial companies, certain disputes between banks or financial institutions and merchants, international trade, judicial settlement, and bankruptcy.

Ordinary court proceedings begin with filing a statement of claim before the competent court. The statement should identify the parties, set out the facts, state the claims, indicate the legal grounds, and refer to the evidence. After registration of the case, the court registry records the case number and the date of the first hearing; the statement of claim and its attachments are then served on the defendant. As a rule, at least twenty days must pass between service and the first hearing. If the defendant is outside Algeria, this period may be extended to three months.

In commercial cases, an additional preliminary stage may arise before the merits are examined. Disputes before the commercial section may first be referred to mediation. For cases falling within the jurisdiction of a specialized commercial court, depending on the category of dispute, filing may be preceded by a conciliation attempt; if no agreement is reached, the case continues with a record confirming the failure of conciliation. Therefore, in commercial debt cases, it is necessary to assess not only the existence of the debt, but also the proper court and the preliminary steps required by law.

At the hearing, the parties appear in person or through representatives. Evidence is submitted to the court and communicated to the other party. The parties may exchange documents during the hearing or through the court registry outside the hearing. If the defendant fails to appear despite proper service, the court may examine the case on the basis of the documents submitted by the claimant.

The court hears the parties’ positions, evaluates the evidence, and decides on the merits if it considers the case ready for judgment. If the case is not ready for decision, the court may request further explanations, additional documents, or investigation of facts that may affect the outcome of the dispute. After these steps are completed, the court re-examines the file and decides on the existence of the debt, its amount, costs, and other applicable legal consequences.

The order for payment procedure may be used when the creditor has a claim for a determined amount that is liquid, due, payable, and supported by written evidence. Relevant documents may include an acknowledgment of debt, a payment undertaking, an invoice accepted or certified by the debtor, and commercial documents proving the origin and due date of the debt. The creditor files the application in two copies with the president of the court at the debtor’s domicile and attaches all documents proving the claim.

If the claim appears sufficiently proven, the president of the court issues the order within five days from the filing of the application and orders the debtor to pay the principal amount and costs. If the conditions of the procedure are not met, the application is rejected. The rejection is not subject to a separate appeal, but the creditor may still bring the claim through ordinary court proceedings.

The order for payment is served on the debtor together with a demand to pay the principal amount and costs. The notice must inform the debtor of the right to object to the order within fifteen days from service. The objection is examined by the judge who issued the order and suspends enforcement. If the debtor does not object within the statutory period, the order becomes final, and an enforceable formula may be issued on the basis of a certificate confirming that no objection was filed. If the enforceable formula is not requested within one year from the date of the order, the order for payment ceases to have effect.

The decision of the court of first instance may be appealed before the competent court under the rules of Algerian civil and administrative procedure. The appeal period is generally one month from personal service of the contested decision. If service is made at the actual or elected domicile, the period is two months. For default judgments, the appeal period starts after expiry of the objection period.

The decision of the court of appeal may be challenged before the Supreme Court of Algeria through a cassation appeal. The period for this appeal is generally two months from personal service of the contested decision and three months if service is made at the actual or elected domicile. For persons residing outside Algeria, procedural time limits are extended by two months. In debt collection cases, a cassation appeal normally does not suspend enforcement, except in limited cases expressly provided by law.

If the creditor already has a foreign court decision against a debtor located in Algeria or against assets located in Algeria, that decision cannot be enforced automatically in Algerian territory. It must first be declared enforceable by an Algerian court. The court verifies, in particular, whether the foreign decision respects jurisdiction rules, has become final in the country where it was issued, does not conflict with an earlier Algerian decision, and does not violate public order or good morals in Algeria. This stage is especially important in international debt collection cases.

Once the decision can be enforced, the creditor should initiate the enforcement procedure on the basis of an enforcement title. Depending on the type of decision, it may be necessary to obtain an enforceable formula, a certificate confirming that no objection or appeal was filed, or other documents proving enforceability. Forced enforcement is carried out through authorized enforcement officers and, as a rule, begins with a demand requiring the debtor to perform the obligation stated in the enforcement title within a maximum period of fifteen days.

Within forced enforcement, the creditor may target funds held by the debtor or by third parties, bank accounts, movable property, immovable property, company shares, securities, and other seizable property rights. If there is a risk of concealment or transfer of assets, protective measures may also be considered before forced sale. In international cases, the creditor should also take into account the payment method, the currency of the debt, possible conversion, and banking rules affecting the actual transfer of recovered funds.

An alternative or additional way to collect a debt from a company or merchant is the opening of judicial settlement or bankruptcy proceedings if the debtor has stopped making payments. Under the Algerian Commercial Code, the relevant merchant or private-law legal entity must declare this situation within fifteen days so that the applicable procedure can be opened. However, the procedure may also be opened at the request of a creditor, regardless of the nature of the claim, especially where the debt arises from an invoice payable on a fixed date.

The opening of judicial settlement or bankruptcy proceedings changes the collection strategy because it may suspend individual actions by creditors included in the collective estate and concentrate the treatment of claims within collective proceedings. Therefore, if the debtor has stopped making payments, it is necessary to assess whether an individual claim, enforcement, or participation in the collective proceedings is the more effective route.

If the debtor’s assets are insufficient to satisfy creditors, certain transactions made after the date of cessation of payments may be treated as unenforceable against the collective estate. These may include gratuitous transfers of movable or immovable property, contracts in which the debtor’s obligations significantly exceed the consideration of the other party, payment of debts not yet due, granting security for earlier debts, and certain acts entered into with a party that knew the debtor had stopped making payments.

In certain cases, the court may also declare gratuitous acts made within the six months preceding the date of cessation of payments unenforceable against the collective estate. The date of cessation of payments is determined by the court opening the judicial settlement or bankruptcy proceedings and cannot be set more than eighteen months before the decision. These mechanisms aim to restore the available estate, preserve equality among creditors, and improve the chances of satisfying claims admitted to the procedure.

If you have questions about international debt collection in Algeria, our team can analyze the documents, determine the appropriate collection route, prepare an amicable or judicial strategy, coordinate enforcement actions, and assess the creditor’s position if the debtor enters judicial settlement or bankruptcy proceedings. Contact us to analyze your case and determine suitable measures based on the debtor’s situation, the available evidence, and assets located in Algeria.

# DEBT COLLECTION AGENCY ALGERIA  

26.11.2024

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