Do you still have any outstanding debts with a defaulter in Malta? For example, an unpaid invoice from a business you have dealings with or someone who owes you compensation? Collection Company specializes in international debt collection and can collect your outstanding invoices in Malta.
We work with a carefully built network of local specialists such as lawyers, legal experts, and bailiffs. They are familiar with local laws and regulations regarding debt collection and know exactly what the most effective way is to collect your money.
Specialized in debt collection in Malta
Debtors who do not pay their bills are always troublesome, especially when they are located abroad. After all, you cannot simply drop by to ask what’s going on. Additionally, Malta most likely has different legislation than your own country, which makes the situation even more complicated. What steps can you take to collect your claim?
Fortunately, Collection Company specializes in international debt collection. We have developed a successful procedure to collect invoices and other claims abroad. In order to do so we work with a network of international lawyers, legal experts, and bailiffs. Our team of local specialists is familiar with local laws and regulations, so they know exactly what procedures we can follow to collect your claim.
As the creditor, you have a dedicated English speaking contact. This international debt collection specialist communicates with the local experts and coordinates the process. Therefore, you don’t have to speak with the parties in Malta yourself. You can monitor the progress of the debt collection process 24/7 through our Online Cockpit.
Would you like more information about debt collection in Malta? Contact us for a free consultation.
Why choose Collection Company for your debt recovery in Malta?
Submit your debt recovery case
Do you have a debt collection case in Malta? Please submit your contact details and one of our debt recovery specialists will get in touch with you as soon as possible to discuss your case.
How does debt collection work in Malta?
Just like in most countries, the Maltese debt collection process consists of two overlapping phases, namely the extrajudicial phase and the judicial procedure.
The first step of the debt recovery procedure is usually an extrajudicial process (also known as amicable or out of court debt collection). This phase involves all efforts to collect payment from your debtor without filing a lawsuit. This may include sending payment reminders, as well as building a case file. In 9 out of 10 cases, an extrajudicial process is sufficient to collect your money. Often, it is not even necessary to take legal action.
Unfortunately, in some cases, it is necessary to initiate a legal procedure. If your debtor refuses to pay or if a conflict arises, for example, over an invoice, there is no other option but to go to court. We can also assist you in this process.
Below we explain in detail how both the extrajudicial and judicial debt collection work in Malta.
Extrajudicial or amicable collection is a fast and effective way to encourage your Maltese debtor to pay the outstanding invoice. In 9 out of 10 cases, we are able to collect your claim through out of court proceedings. Because we work together with local specialists, we can address your debtor in both English and Maltese.
We start the amicable phase by serving your debtor with an official notice of default, making it immediately clear that a debt recovery agency has been engaged.
Additionally, we attempt to establish personal contact with the debtor. We do this through email, SMS, WhatsApp, and telephone. This way, we can gradually increase the pressure on your Maltese debtor. It also allows us to identify at an early stage if your debtor disputes the invoice, and we can explore the possibility of resolving the disagreement.
In total, there are 16 moments of contact with your debtor within a period of three weeks. If your debtor still does not pay during this period, we ultimately send a final demand letter. With this judicial letter, we give your debtor one last chance to settle the invoice before we take legal action. In this letter, we also outline the costs your debtor will incur if a judicial procedure ensues.
At this stage, most defaulters choose to settle the outstanding amount.
Judicial debt collection in Malta
If the debtor does not pay, even after an amicable collection procedure, there is no choice but to take legal action. The judicial process in Malta depends on the amount of the claim.
Malta has a special Small Claims Tribunal (Tribunal għal Talbiet Żgħar in Maltese). Here, cases are resolved in a faster and less formal manner compared to higher courts. Claims with amounts not exceeding €5000, can be brought to this tribunal.
To file a case at the Small Claims Tribunal, we need to submit a Notice of Claim to the court on the island of Malta or Gozo. This can be done both physically and digitally. During the filing, we can attach supporting documents for your claim.
Afterwards, your debtor has 18 days to respond to your claim and may also file a counterclaim if necessary.
Once the claim is filed, it will be registered by a deputy registrar within one day. The following day, an adjudicator will be assigned. This adjudicator acts as a judge for small claims and is chosen from a selection of attorneys.
The adjudicator assesses the case based on legal merits. The aim of this process is to reach a quick judgment.
Both parties have the option to appeal the decision if they disagree. The case will then be heard by a judge from the Court of Appeal.
When the debt exceeds €5000 but is decisive and clear, special summary proceedings can be followed as stated in Article 166A of the Code of Organisation and Civil Procedure.
Claims between €5000 and €15000
If you have a claim that is higher than €5000, but lower than €15000, we can bring your case before the Magistrates’ Court (l-Qorti tal-Maġistrati). This is done in a similar way to filing a small claims procedure and can be done at both the court in Malta and Gozo. Instead of an adjudicator, the case is now handled by a magistrate, which is a lower judge in Malta.
The case is treated more in debt than at the small claims court. The magistrate will ultimately make a ruling based on the submitted evidence.
It is possible to appeal against a ruling of the Magistrates’ Court at the Court of Appeals.
Claims above €15000
When the debt exceeds €15000, the claim is referred to a higher court: the First Hall of the Civil Court (L-Ewell Sala Tal-Qorti Ċivili). This court deals with all civil and commercial matters that exceed the jurisdiction of the Magistrates’ Court.
In the Civil Court, the case is comprehensively reviewed by a single civil judge. Both parties can submit evidence and call in witnesses. Depending on the complexity of the case, the judge may determine that multiple hearings are necessary. Ultimately, the judge gives a verdict.
If either party wishes to appeal after the judgment, the case is reheard by three judges of the Court of Appeals.
How does the debt collection process work in Malta?
Every collection procedure starts with an amicable process. In this phase, we send your debtor a reminder. We also make phone contact with the debtor. Gradually, we increase the pressure through phone calls, SMS or WhatsApp messages, and emails. We continue doing this until the outstanding amount is paid. If necessary there will be a maximum of 16 contact moments within a period of 3 weeks.
When the debtor fails to pay within these 3 weeks, we will send a final demand letter. In this letter, we inform the debtor that we will take legal action if the amount is not paid by the date mentioned in the letter. We make it clear that this will result in significant costs for them.
Ultimately, as the creditor, you decide whether to proceed with legal action. If you choose to do so, our international debt collection specialist will discuss the available options and what the judicial procedure will entail.
European Small Claims Procedure
It is not always necessary to initiate legal proceedings in the Maltese court. Malta is a member of the European Union, and within the EU, there are various procedures to enforce cross-border claims in other member states. One of them is the European Small Claims Procedure, which is a special, expedited procedure for cross-border claims under €5000. This process is completely digital.
If you are based within the EU but not in Malta and your debtor is based in Malta, and you have a claim of less than €5000, we can file a claim with the court in your country. The court will then forward your claim to the debtor. Your debtor has the opportunity to object. If that happens, both parties can submit digital evidence. If necessary, the judge may decide to organize an online hearing via a video call.
Ultimately, the judge will make a ruling in your case. This judgment is then enforceable in all EU countries, except Denmark.
European Payment Order (EPO)
Another option is to apply for a European Payment Order (EPO). This is possible when it concerns an undisputed, cross-border claim within the EU. An undisputed claim is a claim where your debtor does not contest the debts due to you but nevertheless still doesn’t pay. Often, it involves invoices to which your debtor simply does not respond. The amount of the claim does not matter in this case.
The creditor may apply for an EPO in their own country. After completing a number of standard forms, the court assesses your claim and then issues a payment order.
The debtor will receive the payment order and subsequently has the opportunity to object to the claim. If he does not do so, we can have a bailiff execute the payment order.
Legal procedures can be time-consuming. That is why many companies opt for an alternative way to resolve business disputes. This can be done, for example, through arbitration. This is a private alternative to regular litigation. Instead of going to court, your case is presented to one or more arbitrators. These are usually experts from the industry itself and can be appointed by the parties involved in the dispute.
Arbitration has several advantages over normal legal proceedings. First and foremost, arbitration is faster. Additionally, the case is judged by experts. Another advantage is that the parties themselves can make agreements, for example, that there is no possibility of appeal.
To use arbitration, all parties involved in the dispute must agree to this. They can do this once the dispute has arisen. It is also possible to agree beforehand that any conflicts will be resolved through arbitration, for example, by including it in the general terms and conditions.
Interim attachment in Malta
Before initiating legal proceedings, it is important to take measures to prevent the debtor from concealing or disposing of their assets, leaving you with nothing to recover once a court judgment is obtained. One way to accomplish this is by obtaining a prejudgment attachment order.
According to Maltese law, it is possible to request the court to take protective measures that ensure the enforcement of a future court judgment. The most common form of precautionary measures are freezing bank accounts or temporarily seizing assets.
Enforcement proceedings in Malta
If the judge grants your claim, it does not automatically mean that you will have the money in your bank account. What if your debtor still refuses to pay the owed amount voluntarily? In that case, we can ask the court to enforce the judgment (or another enforceable title document such as a European Payment Order) through seizure. The court will grant the document an enforceable title, after which we can submit it to the court’s bailiff.
The bailiff will then seize your debtor’s assets. This can include seizure of income, bank accounts, cars, and other possessions. The bailiff can auction these publicly and pay you from the proceeds.
If your debtor is unable to pay the money owed, the creditor may file for their bankruptcy. Our experience is that defaulters often claim they cannot pay the bill, but once a bankruptcy petition is filed, they all of a sudden pay the outstanding amount.
In Malta, it is possible to file for the bankruptcy of a debtor if they fail to pay a significant portion of their debts. There are no other requirements in the laws of Malta. So, if your debtor has a substantial outstanding bill, we can file for bankruptcy. This is done at the First Chamber of the Civil Court.
When the court declares bankruptcy, a liquidator is appointed, who will try to repay the outstanding debts to the creditors.
But usually, it does not come to that. No one wants to go bankrupt, and there is a good chance that your debtor will do everything possible to pay the bill if we file a bankruptcy petition. Once we have received the money, we can withdraw the bankruptcy petition.
Need advice on your case?
Is your debtor in Malta not paying their outstanding invoice? Submit your details and one of our debt collection specialists will contact you as soon as possible.
Legal areas of debt collection
At Collection Company, we are capable of collecting virtually all your outstanding claims in Malta. This includes unpaid invoices, as well as compensations, unpaid loans, and disputes related to the rental or sale of real estate.
Collection Company operates in the following legal areas:
- Construction law
- Rental and leasing
- Buying and selling
- Labor law
- Agency agreement
- Damages and wrongful acts
We assist clients directly, but also work for intermediaries such as lawyers and accountants.
Anything else we can help you with in Malta?
- Reliable advice on contracts and terms
- Credit information on companies in Malta
- Disputes regarding retention of title and right of reclamation
- Mediation in reaching private agreements and settlements
File your claim immediately
Submit your claim to us now via the debt collection registration form. Do you prefer to first consult with one of our debt collection specialists? Leave your details or call us at 070 – 762 0330.
Free advice on debt collection in Malta?
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FAQ: Frequently Asked Questions about debt collection in Malta
FAQ: What do we need for a debt collection in Malta?
If you submit your debt collection case against your debtor to us, we would like to receive as many documents as possible that support your claim. These may include a contract or agreement, sent invoices and payment reminders. Additionally, documents such as bank statements, delivery confirmations, and credit notes can help support your claim.
However, we understand that there may be various circumstances preventing you from having the aforementioned documents. Even if that is the case, you can still submit your claim to us. Our debt collection specialist will contact you and discuss with you how we can prove your claim.
If available, we would appreciate receiving the following documents:
- A copy of the agreement
- Email correspondence confirming the agreement
- A fax confirmation
- Your summary of the agreed terms
- A copy of your general terms and conditions
- Any proof of delivery, if available
FAQ: What language is used in court proceedings in Malta?
Usually legal proceedings in Malta are conducted in Maltese. Upon request from one of the parties, the judge may decide to use English. All parties must agree to this. If one of the parties objects to the use of English, the case will be handled in Maltese.
FAQ: What is the statute of limitations for claims in Malta?
Claims don’t stay collectible forever. In Malta, there is a limitation period of 6 years for monetary claims. This period starts from the moment the claim arises, for example, when the due date of an invoice expires.
After a judgment by the court, the verdict remains enforceable for 10 years.
FAQ: How much does a small claims procedure cost in Malta?
One of the advantages of the small claims procedure in Malta (for claims up to €5000) is that the costs are relatively low. The court fees amount to €40. There are additional costs for legal assistance and serving documents to the opposing party.
FAQ: Why not hire a debt collection agency in Malta?
As a creditor, you can also choose to hire a debt collection agency in Malta. However, there are several disadvantages to consider. For instance, you need to be aware that in that case, you will often have to be able to communicate in Maltese. If you need to send documents or judicial letters, you will have to send them from the country you reside to Malta, which can cost a lot of time and money.
Moreover, many collection agencies in Malta only handle the extrajudicial part of the collection process. If you want to initiate legal proceedings against your debtor, you will have to find a law firm in Malta yourself.
At Collection Company we take care of all of this. You will have one dedicated English speaking contact that will stay in touch with the local specialists in Malta. We have an extensive network of the best lawyers and bailiffs in Malta, allowing us to handle the entire debt collection process, from the extrajudicial phase to the legal procedure.
Throughout the entire process, you, as the creditor, can monitor the progress yourself in your own Online Cockpit.