Debt collection in Greece

The debt collection procedure in Greece begins with an assessment of the debtor’s solvency, his field of activity, the history of the enterprise, the availability of documentary evidence of the debt, current court cases and enforcement procedures, as well as the possibility of challenging the debt. This assessment determines the strategy that will be used on behalf of the client during the collection process.

If the debtor does not have current court cases or outstanding court decisions on debt collection, and he is actively engaged in commercial activities, then it is advisable to use the stage of amicable debt collection.

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

Interaction with the debtor begins immediately after sending the notification by mail, email, telephone or instant messengers. This process involves intensive communication with the debtor in order to apply constant pressure. The main task is to establish contact with key decision makers to achieve speedy debt repayment.

The average time for informal out-of-court collection is up to 60 days (except in cases where an installment plan for debt repayment has been agreed upon). If this stage does not bring the expected results or after an initial analysis it becomes clear that it is not applicable, you should proceed to recovery through the procedures provided for by law.

Before initiating legal action, you should pay attention to the statute of limitations. The general statute of limitations is 20 years, but for debt collection claims it is 5 years. Any agreements between the parties aimed at increasing or decreasing the specified limitation period are invalid. The limitation period begins from the end of the year in which the payment deadline occurred. The limitation period may be interrupted in cases where the debtor has acknowledged the debt in some way. After the limitation period is interrupted, it begins to be calculated anew from the expiration of the year in which the interruption occurred.

Judicial collection of receivables in Greece is carried out through the issuance of a payment order, the procedure for small disputes and general proceedings, as well as the procedure for issuing a European payment order.

The procedure for issuing a payment order is applicable to undisputed monetary claims of the creditor and is implemented by submitting an appropriate application to the court. The court considers the application as quickly as possible without summoning the debtor. The court has the right to summon the applicant to give additional explanations or oblige him to make additional changes or corrections to the application. If the consideration is positive, the court issues a payment order, which is handed to the debtor within two months from the date of its issue. If the payment order is not delivered within the specified period, it is automatically considered invalid. After receiving the payment order, the debtor has the right to file an objection within fifteen working days if the debtor is located in Greece, or thirty working days if the debtor is a non-resident. Filing an objection does not suspend the effect of the payment order, but at the request of the debtor, the court may suspend it with or without the requirement of a commensurate deposit. If the objection is filed within the deadline and is justified, the court cancels the payment order, otherwise it rejects the objection and confirms the payment order.

Small disputes proceedings are applicable for cases where the value of the claim does not exceed 5,000 euros. It is implemented by filing a claim with the secretary of the magistrate’s court, after which a copy of it must be served on the defendant within 10 days (for foreign defendants – within 30 days). Within 20 days after serving the claim on the defendant, the parties are required to provide the court with their written positions on the case and evidence (this period is extended by another 20 days if the location of the defendant is unknown or the defendant is a non-resident). After this period, these documents are not accepted by the court. The case is considered in a meeting in the presence of the parties, as a result of which the court announces a decision in an open meeting. This decision is final and is not subject to further appeal.

General claim proceedings are carried out by filing a claim in the court office and delivering a copy of it to the defendant. Before filing a claim in court, the interested party has the right to request the intervention of the magistrate responsible for considering the claim. The magistrate promptly summons the parties to the case to consider the essence of the entire dispute. At the same time, the judge is not bound by the applicable procedural and substantive law, freely evaluates various facts and tries to find a way to a compromise. The results of the conciliation settlement are reflected in the protocol, which entails all the consequences of a judicial settlement for the parties.

In addition, depending on the circumstances of the case, the court may invite the parties to resort to judicial mediation, which is carried out through individual or joint conversations between the parties and their lawyers with a mediating judge. The mediator may make binding proposals to the parties to resolve the dispute. The duration of judicial mediation is up to six months. If the parties reach an agreement, a court mediation protocol is drawn up.

The consideration of the claim is carried out in court hearings, with the parties summoned and their positions on the case heard. As a result of consideration of the case, the court makes a decision, which becomes final after the end of the period for appeal.

Any party to the dispute who is not satisfied with the final decision of the court of first instance has the right to appeal it on appeal within thirty days if the appellant resides or is located in Greece, or within sixty days if the appellant is a non-resident or his whereabouts are unknown. In both cases, the period is calculated from the moment the decision is made.

As a result of consideration of the appeal, the court makes a final decision, which can be appealed to the Supreme Court within the same time frame as for the appeal. Filing an appeal to the Supreme Court does not suspend the effect of the final decision, but if there is a probable risk of damage from the execution of the decision, the restoration of which is difficult, at the request of one of the parties, a full or partial stay of execution of the disputed decision may be ordered, with or without the provision of a proportionate guarantee. As a result of considering the appeal, the Supreme Court makes a decision that is not subject to further appeal.

The Civil Procedure Rules provide for the possibility of using the European Payment Order procedure, which is applicable to cases of undisputed monetary claims between parties from European Union countries (excluding Denmark). To obtain a European payment order, you must fill out a standard application form and submit it to the court. The court accepts the payment order in closed session and sends it to the debtor, after which the debtor has 30 days to file its objections with the court. If the debtor files an objection, the court summons the plaintiff to inform his position on the case and, if it considers the debtor’s objection to be justified, cancels the payment order. In this case, the case is subject to consideration in civil proceedings. If the debtor does not submit any objections to the court, the payment order acquires the force of a final decision. The European Payment Order is recognized in all EU member states (except Denmark).

After receiving the final court decision, if the debtor refuses to voluntarily comply with the court decision, you should obtain a writ of execution that has an executive form (extract) and hand over to the bailiff a copy of the inventory with an order for execution. A check is issued under the copy of the inventory and the claim must be accurately stated in it. Satisfaction of the creditor’s claims in the process of forced execution is carried out through the seizure of funds and their write-off, seizure of mobile and real estate with their subsequent sale, forced management of property or entrepreneurship (business) of the debtor, seizure of property rights, in particular, intellectual property rights , patents, cinematographic rights to use films, provided that, in accordance with the provisions of substantive law, the transfer of these rights is permitted.

In certain cases, at the stage of enforcement proceedings, personal detention is allowed, provided that the amount of debt is at least 30,000.00 euros. In relation to legal entities, with the exception of joint-stock companies, limited liability companies and private capital companies, personal detention of their representatives is assigned.

The Greek Civil Procedure Code prohibits enforcement actions from August 1 to August 31, with the exception of cases involving ships and aircraft.

If forced execution does not lead to positive results, if there are signs of bankruptcy (the debtor is not able to fulfill its overdue financial obligations in a general and permanent manner (cessation of payments), then it is advisable to initiate a bankruptcy procedure. This procedure provides for the possibility of legal action cancel (cancel) fraudulent/fictitious transactions of the debtor aimed at withdrawing their assets in order to avoid repayment of debt through the forced sale of such assets.

In addition, the Bankruptcy Code allows for the bringing to joint liability of members of the board of directors of a legal entity if the bankruptcy of the company occurred as a result of fraud or gross negligence of such persons and the involvement of persons who exerted their influence on the members of the board of directors for the purpose of their committing actions or inactions that led to bankruptcy companies.

Also, if a company fails to file a bankruptcy petition on time, the members of its board of directors responsible for the delay are responsible for the restoration of losses to corporate creditors in respect of debt accrued from the date on which the petition should have been filed until the company was declared bankrupt. The same liability is borne by the person who caused a member or members of the board of directors to fail to submit an application on time.

If you have any questions or need support with international debt collection in the Hellenic Republic, our company is ready to provide our expert assistance to effectively resolve your financial issue. Please contact us to receive additional information and professional support from specialists of the leading debt collection agency.

# DEBT COLLECTION AGENCY GREECE

12.04.2024

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