Debt Collection in Denmark

Updated on Monday 25th September 2023

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In certain cases, companies opened in Denmark don't pay their debts to the suppliers, even in a strong economy as Denmark has nowadays.

In order to recover these debts, special measures have to be instituted to force the debtor to cover the claims.

Quick Facts
Types of payments that can be collected with the help of our debt collection lawyer	Civil claims (for natural persons), commercial claims (for legal entities), salary claims, tax receivables, etc.
When to start the debt collection procedure	As per the signed agreement with the debtor, once the agreed payment term is exceeded.
Amicable collection	We recommend amicable collections in order to maintain a professional relationship with the debtor.
Use of mediation	Mediation is recommended (and provided upon request) by our lawyers in Denmark, as suitable in your case.
Amicable collection estimated duration	1-3 months or as otherwise agreed in a payment schedule
Summons for payment	Standard if the amount does not exceed a certain amount; it is sent to the bailiff's court in the debtor's area of residence.
Appeals	Within four to eight weeks of the decision.
Bankruptcy collection	Possible if the debtor is considered insolvent and if the creditor has a legitimate interest to file a petition for the debtor's bankruptcy.
Estimated duration for the court procedure	Approximately 10-12 months
Forced execution	The judgment is enforceable as soon as it is final. The claimant can enforce the order through the Bailiff's Court within two weeks.
Forced execution duration	May take 6 months or more
Relevant documents for debt collection	Invoices, the signed services agreement between the parties, account statement, debt collection letter, any relevant correspondence between the parties, etc.
European Payment Order	Our lawyers can help you enforce this simplified collection procedure for cross-border monetary claims uncontested by the defendant.
Time limits for debt collection in Denmark	Business claims should be brought to court within three years (or less in some cases) calculated from the invoice date.
Legal assistance offered by our lawyers in Denmark	Our lawyers in Denmark assist clients in collecting overdue payments through amicable and legal action, as well as alternative dispute resolution methods.

Debt collection stages in Denmark

Just like in any other jurisdiction, there are two phases of the debt collection procedure in Denmark: a pre-judicial stage and a judicial stage.

In the first stage, the creditor is sending a reminder to the debtor with the request to pay no later than 1-2 weeks. If the debtor is not paying, the creditor is advised to use the help of a debt collection agency or a team of attorneys, such as our specialized lawyers in Denmark.

The attorneys in Denmark are the ones to request the debtor to pay the debts through a written notification and by phone, in a maximum term of 10 days.

In certain cases, an amicable settlement is signed between the debtor and the creditor and the payment is made in installments or after a longer period of time.

The amicable settlement also includes the debtor’s confirmation that he agrees to pay those debts and the payment conditions. In case of non-payment, this document can be used against the debtor in the judicial phase.

Working with our local team of accountants in Denmark will allow you to receive updated information on your accounts receivable and manage any situation that arises in connection to payments that have not been made to this account. After a clear evaluation of the accounts receivable, you will be able to decide on the collection approach with the help of our specialists.

Please watch the video below for more information on debt collection in Denmark:

The judicial stage in Denmark

In the legal phase of a debt collection procedure you will definitely need the help of a Danish law firm.

We list the main characteristics of the judicial debt collection process below:

The Danish courts procedures can be simple or ordinary;
The simplified procedure is used when the claims do not exceed 50,000 DKK. The bailiff is sending a request for payment that can be contested no later than 14 days. If it’s not contested, the Bailiff can endorse the request of payment;
If the debtor is contesting the request, the ordinary procedure must be instituted. The ordinary procedure is also used in case the debts are above 50,000 DKK.

The district courts of Denmark hear cases related to the debt collection.

The bailiff is serving the writ drawn up by the attorney to the debtor. The attorney is submitting this writ at the Court Registry.

The hearing of the case is made no later than 1 to 3 months after submitting the writ.

In this period of time, the debtor can pay its debts. If not, the court is ordering him to pay the debt, the court fees and the attorney’s fees. If the payment is not made, the judgment is enforced no later than 14 days and without other notification to the debtor.

The bailiff is carrying the enforcement at the request of the attorney. First, the debtor is called in front of the court to present his financial situation and a list with his assets.

If the debt cannot be paid at once, installments for a period of 10 months can be decided.

If the payment is still not made, the assets of the debtor can be auctioned.

If the assets are not sufficient to cover the claims, an insolvency procedure is initiated.

An insolvency declaration prevents creditors to start a new process against the debtors for a period of 6 months.

The Danish debt collection law

The general debt collection process is regulated through the debt collection law.

Our team of lawyers in Denmark highlights some of the most important provisions below:

Inquiries to the debtor: are made through a letter of demand, before other measures are taken; the letter must clearly mention the time limit within which the debtor can make the payment without any measures being taken against him;
Legal action: is to be commenced against the debtor when the absence of this action would make the claim otherwise unrecoverable.
Access to the debtor: entry onto the debtor’s premises for the purpose of collection cannot be made without a notification latter;
Collected amounts: are to be deposited immediately into a bank account and paid to the creditor without delay, unless otherwise agreed; the interest on the deposited amount accrues to the creditor.

According to law, any person or company that carries out debt collection activities must hold the proper authorizations for this purpose.

A person can be authorized as a debt collection in Denmark if he/she is a resident and over the age of 25, if he /she is not undergoing bankruptcy proceedings and has not been convicted of a criminal offense relevant to these types of activities.

A company in Denmark can be licensed for debt collection purposes if it is not subject to reorganization or bankruptcy, as well as when it meets other criteria concerning its members and directors.

Companies need to make sure that the staff which will be employed for the purpose of engaging in the debt collection activities has the needed approvals.

Individual debt collectors, as well as companies in Denmark, need to observe the principles of good debt collection practice.

Answered questions about debt and debtors in Denmark

Each debt collection case depends on the debtor’s particular situation, as well as the amount that is being collected and other issues.

Below, our team answers a few questions that can arise during the collection process.

Do I need to enforce my claim?

Yes, this may be a required step. The claim for debt collection is made to the enforcement court, based on the execution title, the judgment issued by the court who has analyzed the case.

When the enforcement procedure is initiated, the assets of the debtor are subject to distribution by the enforcement court.

Do I need to file for bankruptcy if the debtor cannot pay?

Companies that cannot meet the debts to their creditors are subject to court liquidation.

In this case, the court commences the liquidation process and one of the creditors is the one to petition for bankruptcy.

When the company is going through the bankruptcy process, it cannot manage its assets and an official trustee is appointed for this purpose, including for attempting to make the needed payments towards creditors.

How is debt owed to the public authorities treated in Denmark?

The Danish Debt Collection Agency (Gældsstyrelsen) is the one to which outstanding debts are transferred from the Tax Agency, both in the case of individuals and in the case of companies.

For companies, the debt can be offset from the tax refund, according to each particular case.

If you require assistance in this special case of owning debt to a public authority in Denmark, our lawyers can assist you.

Our lawyers in Denmark focus on effective and professional debt collection solutions.

We strive to help our clients recover their debts amicably, however, when this is not suitable or possible, we are able to offer complete legal assistance for court intervention.

If you need assistance in a debt collection case, do not hesitate to get in touch with our attorneys in Denmark.

Our law firm in Denmark also offers other services for companies. Upon request, we also offer accounting services.