Netherlands

The Netherlands

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GGN

GGN

Debt collection specialists and court bailiffs: GGN has them all in-house. A unique combination making us a broadly based and trendsetting organisation in the field of credit management.

Operating nationwide

GGN

GGN has 27 debt collection and court bailiff operations spread across the Netherlands. Over the years we have built up a valuable network where thorough knowledge of local markets and regional legislation are central.

GGN is headquartered in 's-Hertogenbosch, where the board and a number of central support services are based together with the units operating nationally, such as GGN Academy,

GGN Detachering and GGN International. The large accounts in the area of out-of-court debt collection are also served from 's-Hertogenbosch.

Expert staff

In total, our organisation counts some 1350 employees, among them more than 140 (trainee) court bailiffs, 500 collection specialists and 55 lawyers. In addition, GGN operates an extensive network.

Partners

GGN works with lawfirm Ploum Lodder Princen for International Claims. This Rotterdam based Dutch lawfirm is not your average law firm.

“Our clients will confirm that it is significantly different. Our goal is to support businesses in achieving theirs. Combining knowhow and practical experience to your advantage is our talent. It’s in our DNA.

Business-wise lawyers
We understand what business is about and we know what is important to you. Our expertise is built on what matters to business. We help you achieving your goals swiftly and smoothly.

Our lawyers bear your objectives in mind and have your interests at heart. We invest in knowhow relevant to your business. We expand our network to your advantage and share our best practices, saving you time and resources.

Effective solutions
Solving real puzzles is our passion. You won’t find any of our lawyers showing off his academic knowhow, so no unnecessary memos and no tentative or indirect advice. Analysing your issues with a fresh and open mind, our lawyers will give you their honest opinion. Providing solutions, not advice.

International claims
We have significant experience in collecting international debts and solving related issues under private international law. This covers the areas of international commercial contracting as well as procedural law (including attachment and execution law and arbitration). We counsel and litigate with regard to the distribution and purchase, sale and delivery of the most diverse goods and services, from manufacturer to end user. We are internationally oriented and we have a well-established informal network of law firms spanning the globe”.

Debt collection in the Netherlands

In the Netherlands, payment default cases are handled by debt collection agencies and court bailiffs. The difference between the two is that there is no specific legislation applying to debt collection agencies and that the court bailiff is a protected profession. After a four-year university course, the bailiff is appointed by the Crown.

There is no zoning in the Netherlands anymore; all bailiffs are entitled to take official action anywhere in the Netherlands

Out-of-court collection procedure

In the Netherlands it is normal to first try to collect an outstanding receivable out of court. The Dutch often tend to pay only once they have been sent various reminders and payment demands.

The out-of-court collection process generally consists of written reminders and a payment demand by telephone. This process begins with the so-called “fourteen day letter”; this letter gives the debtor still fourteen days to settle the claim at no additional cost. If timely payment fails, the creditor is entitled to increase the demand with collection costs established by law. Those costs vary from €40 to €6,775 depending on the principal amount to be collected.

In principle, the costs are for the account and risk of the debtor.

https://www.ggn.nl/zakelijk/Diensten/Calculator%20Incassokosten

Judicial procedures

Substantive proceedings in the Netherlands
If payment remains outstanding, one can revert to court proceedings. Proceedings concerning claims up to €25,000 can be handled completely by the court bailiff at the district court. Only if the claim is higher than €25,000 does one need to institute proceedings via an attorney in the civil courts,

Once a Dutch debtor has been served a summons, he has six weeks to respond to it and most debtors avail themselves of the right to prolong this period by six weeks. The court will then set a date for an oral hearing, which will take place another three to four months later. In practice, this means that any oral hearing will take place six to eight months after the summons was issued.
If the matter cannot be cleared up during the oral hearing, the parties will need to institute further proceedings and any witnesses will then need to be heard. In such cases, the procedure will last twelve to eighteen months.

The legal costs are made up of the following components:

  • summons at €76.17 plus 21% VAT
  • court fee (depending on the principal amount and the claimant)
  • attorney’s fees (depending on how the procedure runs and the number of procedural stages)


Roughly one can expect legal costs of around €750 to €1,000. Generally, the debtor is ordered to pay those costs. 
The costs of instituting proceedings via a lawyer can quickly run to between €2,000.00 and € 5,000.00; in complex cases even a lot more, in which case the debtor will normally be ordered to pay part of the costs given the fact that the costs actually incurred will always be higher.

Undisputed claims
An alternative procedure is the European Payment Order (EPO) as long as the claim is undisputed and there is a clear cross-border element given. The court fees due are the same as the court fees charged in substantive proceedings, but the EPO Procedure takes much less time. In addition, there are no costs charged for the summons, but a form does need to be served twice on the debtor.

The EPO is a written procedure based on forms. The proceedings are initiated using a so-called Form A. The debtor receives no information on this. As long as the court does not hold the claim to be unlawful or unfounded, it issues a Form E. This form is served on the debtor by the court bailiff, after which the debtor has 30 days to lodge an appeal. If he avails himself of that option, the procedure is referred to the competent court and the case is continued in substantive proceedings (see above). If the debtor fails to appeal after receiving Form E, the court will be asked to issue a Form G. This Form G is the enforceable order and, once this form has been served on the debtor, can be executed if payment remains outstanding.

Attachment in the Netherlands

In the Netherlands it is possible to serve attachment without there having been a judgement against the debtor. So assets can be seized really quickly, this is called “conservatoir beslag” (attachment by garnishment). Once attachment has been served, substantive proceedings must be instituted within 30 days. As soon a judgement has been handed down, the creditor can seize the assets on which a warrant of execution has been served. If a debtor is declared bankrupt all attachments lapse. In practice, attachment makes sense only in exceptional cases.

If a judgement has been handed down and the debtor fails to comply with the order, preference is often accorded to an application for bankruptcy proceedings rather than execution of the warrant by a bailiff.

European enforcement order

If a judgement has already taken place, one can ask the court that made the decision to issue a European Enforcement Order (EEO). This document ensures that any undisputed judgement dated after 10 October 2005 can be executed without further proceedings in the country where the debtor is presently located. The costs for this amount to €111.00 and are not recovered from the debtor.

Notarial deed

One exception from the above procedure is a claim ensuing from a notarial deed, such as a mortgage deed for example. The notary before whom the deed was originally executed can designate the deed as a first authenticated copy. No procedure then needs to be carried out and the claim can be executed based on the first authenticated copy of the mortgage deed.

Execution

The judgement, or the enforcement order, is always first served on the debtor, whereby the debtor is given two days to meet his obligations. If payment remains outstanding, the judgement can be executed. The most common means in the Netherlands are repossession of the real estate, attachment of bank accounts and attachment of income. On repossessing real estate, it is important that a list be drawn up of the items seized, but the court bailiff does not take them with him immediately. The bailiff can only take cars and animals (pets) with him immediately on execution. 
Attachment of bank balances is a snapshot situation. On execution, the time is noted on the warrant. All credit balances on the bank account at that moment fall under the execution; all monies that were on or paid into the account before or after that moment do not fall under the execution. Income attachment is a periodic attachment. After attachment, a certain amount every month is paid to the bailiff by the employer or any social security unit paying benefits.
If there are several parties serving attachment, the money seized is distributed by the oldest party to the other parties.

Registers

In the Netherlands, the court bailiff has access to various registers. From the point of view of effectiveness, though, he cannot obtain information just like that.

  • The population register - Can only be consulted for the purpose of taking official action. Once consulted, a warrant has to be issued within two weeks. The information in the population register is valid only for two weeks.
  • Chamber of Commerce - Public register
  • Debt recovery information - Information is requested from external partners against a charge   
  • GGN Database - Inherent information about the debtor may not be shared due to privacy regulations. We may, though, issue advice about the likelihood of collection based on information known to us.
  • UWV - Social security institution. Only possible to consult once a judgement has been handed down. Contains information about the debtor’s source of income
  • RDW - Vehicle and driver licensing authority. Only possible to consult once a judgement has been handed down. Contains vehicle information.
  • Land registry - Only possible to consult once a judgement has been handed down. Contains land register and mortgage information about registered real estate.

 

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