Debt collection in Togo

The debt collection procedure in Togo begins with an assessment of the debtor’s solvency, its field of activity, the company’s history, the availability of documentary evidence of the debt, current court cases and enforcement proceedings, and the possibility of disputing the debt. This assessment determines the strategy that will be used on behalf of the client in the collection process.

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

This stage involves active negotiations with the debtor in order to reach an agreement on the 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 messengers. This process involves intensive communication with the debtor in order to exert constant pressure. The main objective is to establish contact with key decision makers to achieve the fastest possible 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, it is necessary to proceed to collection through the courts.

The Republic of Togo is a member of OHADA (Organization for the Harmonization of Business Law in Africa), which includes nine approved Uniform Legal Acts applicable to all member countries of the above-mentioned organization. Therefore, the procedures for judicial collection of debt, enforcement and bankruptcy are mainly regulated by the provisions of the relevant Uniform Acts.

Before initiating judicial collection, it is worth paying attention to the limitation period. The general limitation period under the national law of Togo is 30 years. According to the provisions of the general commercial law OHADA, obligations arising from commercial transactions between merchants or between merchants and non-merchants expire after five years. The effects of the expiration of the limitation period are applied in the court of first instance and on appeal only at the request of the debtor. The limitation period is interrupted by the recognition of the creditor’s claims by the debtor. After the interruption, the limitation period begins to run anew. The limitation period may be shortened or extended by agreement of the parties. However, it cannot be shortened to less than one year or extended to more than ten years. The parties may also, by mutual agreement, supplement the list of reasons for the suspension and interruption of the limitation period.

Judicial debt collection in the Republic of Togo is carried out in the ordinary judicial procedure and by issuing an order for payment.

The ordinary judicial procedure begins with the filing of an application with the court clerk. The court secretary checks the application and, if there are no comments, asks the plaintiff to pay the required amount to cover the court costs and issues him a receipt with the case number in the register. After the court costs have been paid, the court secretary draws up a summons and arranges for it to be served on the defendant.

The defendant’s appearance period is eight days from the date of receipt of the summons, provided that the defendant is within the territorial jurisdiction of the court. If the defendant is located elsewhere, the appearance period is extended by the following periods: two weeks for persons residing in other prefectures of the country; one month for persons residing outside Togo, in a state to which regular flights are operated with a stopover in Togo; two months for persons residing outside Togo, in a state where there is no direct air connection with Togo.

If the defendant fails to appear, he may be summoned again at the initiative of the plaintiff or by decision of the judge, if the summons was not served in person. If the defendant fails to appear again, the case is heard on the merits. The judge satisfies the claims only if they comply with the rules of law, are admissible and justified.

On the appointed day of appearance, the parties are required to appear in person or through a representative. The court hears the parties and if it finds that the case does not require additional measures to establish the facts, it sets the case for a hearing. If additional measures are required to establish the facts of the case, the court appoints them at the joint request of the parties or on its own initiative. During the additional measures, the parties exchange documents, the court interrogates witnesses, appoints an expert examination, requests evidence from third parties and resolves other procedural issues. After these measures have been completed, the secretary notifies the parties of the reports and summons them to a court hearing, the date of which is set by the chairman of the court. If, after appearing, the defendant fails to perform procedural actions within the established time frame, the judge makes a decision on the merits based on the available materials.

During the hearing, the court evaluates the evidence collected and hears the parties. When the court finds that it has enough information, the chairman of the court announces the termination of the hearing and hears the arguments or comments of the parties in defense of their positions. After this, the final decision is made.

The procedure for issuing a payment order is regulated by the Debt Settlement Act (OHADA) and is used to collect debts related to contracts, negotiable bills or cheques. To initiate the procedure, the creditor must apply to the court for a payment order, attaching documents proving the debt. If the court finds the application to be valid in whole or in part, it issues an order for payment of the specified amount. If the application is rejected in whole or in part, the court’s decision cannot be appealed. The only option for the creditor in such a situation is to file a claim in the usual manner. 

A copy of the application and the payment order must be given to the debtor within three months, otherwise the order becomes invalid. Upon receipt of the documents, the debtor must either pay the debt within 15 days or file an objection within the same period. If there is no objection, the payment order becomes an enforcement document. If an objection is filed, the judge will try to reconcile the parties. If reconciliation is reached, a document is drawn up and signed by the parties, one copy of which contains the writ of execution. If reconciliation is not possible, the court shall immediately hear the case and issue a decision, even if the debtor is absent. This decision shall have the same force as a decision in adversarial proceedings and shall replace the previously issued order for payment. 

The decision of the court of first instance may be appealed to the court of appeal within one month of the date of the contested decision. If the amount in dispute does not exceed 500,000 francs, no appeal shall be allowed. The decision of the court of appeal may be appealed to the Supreme Court of Togo within two months of the date of the contested decision. The filing of a cassation appeal shall not suspend the execution of the contested decision. However, the applicant for a cassation appeal may apply to the President of the Supreme Court with a request to suspend execution if its implementation may lead to irreparable damage. The decision to suspend execution may be conditioned by the provision of guarantees, the terms of which shall be determined by the President of the Supreme Court. The Supreme Court’s decision is final and cannot be appealed further.

After the court decision comes into legal force, the creditor should initiate the procedure for compulsory execution. The court decision can be presented for compulsory execution within 30 years. As part of the compulsory execution of the court decision, the creditor’s claims can be satisfied by seizing and writing off funds from the debtor’s accounts; seizing the movable and immovable property of the debtor with their subsequent sale; seizing and confiscating securities, seizing and confiscating the debtor’s property that is in the hands of third parties.

An alternative method of debt collection is to initiate bankruptcy proceedings against the debtor. In the Republic of Togo, this is regulated by the Uniform Insolvency Law OHADA. A creditor may initiate this procedure if there are undisputed, liquid and payable claims. If the debtor’s assets are insufficient to satisfy all creditors’ claims, the law provides for the possibility of setting aside transactions entered into by the debtor with the intent to cause damage to creditors. Such transactions, entered into between the suspension of payments and the opening of bankruptcy proceedings, include: gratuitous transfer of property; transactions in which the debtor’s obligations significantly exceed those of the other party; early repayment of debts whose payment period has not yet expired; provision of security for previously incurred debts; as well as compensated transactions if the other party knew about the debtor’s financial insolvency. Cancellation of such transactions allows the return of property or assets lost by the debtor, which increases the liquidation estate to satisfy creditors’ claims and cover the costs of the bankruptcy procedure. 

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

# DEBT COLLECTION AGENCY TOGO

12.12.2024

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