Guide to debt collection in Switzerland

To provide you with all the information and advice you need about collecting your invoices, we have asked our partners to produce a practical guide to debt collection in Switzerland.

In Switzerland, debt collection is governed by the Federal Law on Debt Collection and Bankruptcy (SchKG). This law allows creditors to initiate debt collection proceedings, either amicably or through the courts.

The debt collection process in Switzerland

As with any debt collection action, it is important to be well prepared when seeking to collect a debt in Switzerland. As a first step, we recommend that you initiate dunning proceedings and discuss the matter with your debtor to avoid lengthier procedures.

Here are the steps we follow when processing a debt collection.

1.           First step: We first check the address and solvency of the debtor ist a company or a trader. To do this, you can consult the entries in the Trade Register.

2.           Once the details have been checked, the first formal notice should be sent to the debtor. This formal notice should summarise the debt, the context and the contact details of the person in charge of collection (collection agency or creditor).

3.           If there is no response within 14 days, you can send a second formal notice indicating that legal action may be taken.

4.           If there is no response to this letter, we contact the debtor by telephone or e-mail. This is an opportunity to discuss and understand the reasons for the debtor's refusal to pay the bill. It is important to take note of their observations and complaints and to give them the opportunity to express themselves.

If all amicable reminders fail, it will then be necessary to move on to legal and official procedures.

Legal dunning in the Switzerland

In Switzerland, the judicial process must take place via the responsible debt enforcement office in the canton of residence of the debtor.

This means that the debtor or the debt collection agency no longer has to contact the debtor directly. In order to issue an order to pay, the creditor is not required to validate the claim at this stage.

The request for an order to pay sent to the relevant debt-collection office must contain the following information:

- Name and address of the debtor

- Amount of the claim

- Title to the claim or cause of the obligation

- Claim document

Once the request has been received, the debt collection office notifies the debtor by means of a summons to pay, indicating the amount of the debt. The debtor is responsible for the costs of the proceedings, but these must be advanced by the creditor when the request is made, or, if need be, to take it over entirely if the debtor has no money at his disposal.

Why issue an order to pay?

Sending a requisition to the Debt Enforcement Office interrupts the statute of limitations on the debt.

This step is essential for claims subject to short limitation periods. It preserves the right to initiate legal proceedings.

Opposition to the order to pay

The presumed debtor may contest the summons to pay and has 10 days in which to do so. They may ask a judge to examine the validity of the claim against them. It is important to note that if the debtor neglects to lodge an objection, this means that he recognizes the debt and will no longer be able to contest its validity.

Opposition to the summons to pay suspends the collection procedure and obliges the creditor to apply to a judicial authority to have the opposition withdrawn.

Discharge procedure in Switzerland

To obtain the release of the opposition, the creditor must prove the validity of the debt before a judge. The procedure is brief, simple and quick. The judge's role is solely to determine whether the claim asserted by the creditor is valid and whether the debtor is entitled to refuse payment.

The judgment of the judge does not oblige the debtor to make a payment; it simply authorises the creditor to continue with its recovery procedure. In this context, the presentation of a writ of execution (particularly in the case of debts originating abroad) will enable the judge to decide quickly on release, unless proof of payment of the debt by the debtor is presented.

Procedures in Switzerland differ slightly from the standard debt collection procedures used in Europe. It is therefore important to be accompanied by international debt collection professionals who have a network of agencies in most countries of the world.