In an increasingly globalised business environment, Indian companies and individuals often enter into commercial relationships with partners across Europe. Romania, a growing economic hub in Eastern Europe, has attracted foreign investment and trade, but like all markets, debt recovery can sometimes become a challenge. This article provides a concise overview of how to pursue debt collection in Romania, outlining the legal tools available to creditors.
1. Amicable Settlement
Before initiating legal proceedings, Romanian law encourages an amicable resolution. This involves formally notifying the debtor of the outstanding amount through a „payment demand” or „notification of default.” In many cases, especially when the debt is uncontested, this approach can lead to a prompt resolution while maintaining the business relationship.
Engaging a local debt collection agency or Romanian legal counsel at this stage can help negotiate repayment and ensure the communication complies with national regulations.
2. Judicial Procedures
If amicable efforts fail, creditors can initiate court proceedings. The Romanian Civil Procedure Code provides different options depending on the nature and amount of the debt:
- Payment Ordinance (Ordonanța de plată): A fast-track procedure applicable to clear, liquid, and due debts. It is widely used in business-to-business cases and can yield a court order within 45 days.
- Small Claims Procedure: For debts under €10,000, creditors may use this simplified, cost-effective procedure. It is designed to be faster and less formal than ordinary litigation.
- Ordinary Civil Lawsuit: If the debt is disputed or complex, a full civil trial may be required. While this process may take longer, it allows for a comprehensive examination of evidence and contract terms.
3. Enforcement of Judgments
Once a judgment is obtained, the creditor may proceed with enforcement (executare silită). This involves hiring a judicial executor who can seize assets, garnish wages, or freeze bank accounts. It is crucial that the court decision is final and enforceable to initiate this step.
4. Cross-Border Debt Collection
For Indian entities, it’s essential to understand the role of bilateral treaties and EU regulations. If the creditor holds an enforceable title from another EU country, the European Enforcement Order (EEO) mechanism may be used. Although India is not part of the EU, Indian creditors can still engage local Romanian lawyers who are adept at navigating the process of debt collection in Romania for foreign entities.
Conclusion
Debt collection in Romania follows a structured legal framework that supports creditors’ rights while ensuring due process for debtors. Whether through amicable means or judicial enforcement, understanding the procedural options and seeking expert legal guidance are key steps for any Indian creditor aiming to recover dues effectively.
