Debt collection in Botswana

The debt collection process in Botswana begins with an assessment of the debtor’s solvency, their line of business, the history of the business, the availability of documentary evidence of the debt, ongoing court cases and enforcement proceedings, and the ability to dispute the debt. This assessment determines the strategy that will be used on the client’s behalf in the collection process.

If the debtor has no ongoing court cases or outstanding judgments for debt collection and is actively engaged in business, then it is advisable to use the out-of-court debt collection stage.

This stage involves active negotiations with the debtor to reach an agreement on payment of the creditor’s claims or other possible settlement options (e.g. return of goods, transfer of the debt to a third party, exchange of services or goods).

Interaction with the debtor begins immediately after sending a notice by mail, email, phone or instant messaging. This process involves intensive communication with the debtor in order to apply constant pressure. The main objective is to establish contact with key decision makers to achieve early recovery of the debt.

The average time for informal out-of-court collection is up to 60 days (except in cases where a payment plan has been agreed upon). If this stage does not produce the expected results or after an initial analysis it becomes clear that it is not applicable, then it is necessary to proceed to collection through the courts.

Before initiating judicial collection, it is worth paying attention to the limitation period. The limitation period for debt collection based on oral agreements is 3 years. For debts based on written contracts and bills of exchange, the limitation period is 6 years. The limitation period is interrupted if the debtor acknowledges the debt, makes a partial payment of the debt or interest, or provides security. After the interruption, the limitation period begins to count anew.

Judicial debt collection in Botswana is carried out in the ordinary and simplified judicial procedures.

Ordinary court proceeding is commenced by the presentation of a summons, whereupon the registrar of the court, if the summons complies with the procedural requirements, registers it and arranges for the defendant to appear in court.

The period for appearing in court after receipt of the summons is from 14 to 21 days, depending on the distance of the defendant from the court. The defendant’s appearance is registered by properly completing and delivering a memorandum of appearance. Immediately after the defendant’s appearance for the defense, the registrar must refer the case to the judge.

In the event that the defendant fails to register his appearance (provided that the summons has been properly served), the registrar may, on the plaintiff’s application, enter final judgment against the defendant for an amount not exceeding the amount stated in the claim, together with interest at the stated rate, or, if no rate is stated, at the rate of 10 percent per annum until payment. 

If the defendant registers his appearance, the plaintiff must set out a statement of claim in the form of a declaration and file it within 14 days from the date of registration of the appearance. In turn, the defendant must file an application for the plaintiff’s declaration within 14 days from the date of its receipt. After that, the plaintiff must file a response to the defendant’s application within 14 days.

If the plaintiff’s claims concern a fixed sum of money or are based on a liquid document, the plaintiff may, together with the declaration, file a motion for a decision in the order of simplified proceedings. The motion must be accompanied by an affidavit, which can provide supporting evidence on the facts justifying the claim, and also state that the defendant does not have a bona fide defense, and the filing of an application for intent to defend was made solely to delay the case. The consideration of the motion must take place no earlier than 15 court days from the date of filing the motion. At the hearing of the application, the defendant may: (a) provide the plaintiff with security satisfactory to the registrar for any relief, including costs; (b) satisfy the judge by affidavit or oral evidence that he has a bona fide defence to the case. If the defendant fails to provide security or to satisfy the judge, the judge may grant summary judgment in favour of the plaintiff. Otherwise, the case will proceed as usual.

The court will then, after the exchange of procedural papers, schedule a case management conference at which the parties and counsel meet to discuss the nature and basis of their claims and defences and the possibilities for an early settlement of the claim.

After the case management conference is over, the judge will schedule a preliminary hearing. At this time, the claimant must initiate communication with the defendant to prepare a draft preliminary hearing order. The draft order must be prepared 4 days before the preliminary hearing and must cover all questions of fact and law to be determined at the trial; all relevant facts that are not in dispute; the names of all witnesses to be called to give evidence; a list of all evidence that the parties intend to give; proposals to expedite the trial and other procedural matters.

The court then holds a trial and, after all evidence and submissions have been considered, the court holds deliberations between the parties and makes a decision. If the defendant is absent from the trial, the claimant may provide evidence to the extent that the burden of proof is on him. The decision will be made in accordance with the evidence provided by the claimant.

The decision of the Magistrates’ Court may be appealed to the High Court within 21 days of the decision. The decision of the High Court may be appealed to the Court of Appeal within six weeks of the decision being rendered. There is no further appeal against the decision of the Court of Appeal.

Once the judgment has entered into legal force, the creditor must initiate enforcement proceedings. The judgment may be brought for enforcement for 30 years. Within the framework of the enforcement of the judgment, the creditor’s claims may be satisfied by the seizure and debiting of funds from the debtor’s accounts; seizure of the movable and immovable property of the debtor and their subsequent sale; seizure and confiscation of securities; seizure of shares and interests in companies; seizure and imprisonment of the debtor.

An alternative option for debt collection is bankruptcy proceedings against the debtor. The creditor has the right to initiate this procedure if the following conditions are met: 1) the amount of the debt is not less than 100 Botswana pula, payable either immediately or at a specified time in the future; 2) the debtor has committed an act of bankruptcy.

According to the provisions of the Bankruptcy Act, the following acts are considered to be acts of bankruptcy: 1) the debtor disposes of any of his property in such a way as to prejudice his creditors or to give advantage to one creditor over others; 2) makes or proposes to make any agreement with any of his creditors for the full or partial release of the debtor from his debts; 3) the debtor leaves the territory of Botswana or hides from his creditors; 4) the debtor fails to satisfy the demand of the court decision or does not indicate the existence of such property, or if it appears from the report of the executor that he has not found sufficient liquid property of the debtor; 5) the debtor notifies any of his creditors that he has suspended or intends to suspend the payment of his debts, or if he has actually suspended the payment of his debts.

In the bankruptcy procedure, if the debtor’s assets are insufficient to fully satisfy the creditors’ claims, it is possible to cancel the debtor’s transactions made with the intention of causing damage to creditors. Such transactions include, in particular: 1) any disposal of property without valuable consideration; 2) any transaction in which the debtor’s counterparty knew that the debtor was in a state of bankruptcy; 3) giving preference to one creditor over others. As a result of the cancellation of the above actions and transactions, it is possible to return back to the debtor what he lost from such transactions and thereby increase the liquidation estate to satisfy the creditors’ claims and cover the costs of implementing the bankruptcy procedure.

If you have any questions or need support on international debt collection in Botswana, our company is ready to provide its expert assistance to effectively resolve your financial issue. Contact us for additional information and professional support from specialists of the leading debt collection agency.

# DEBT COLLECTION AGENCY BOTSWANA

13.01.2025

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