Debt collection in Portugal

How to recover a commercial debt from a Portuguese debtor

Portugal is a stable market that is open to trade with foreign companies, but even in this context, it can happen that a business partner fails to meet their payment obligations. Knowing the local rules and the main debt collection tools is essential to protect your interests.

Legal actions for international debt collection in Portugal

Anyone wishing to recover a debt from a debtor based in Portugal can use various tools provided for by European and Portuguese legislation:

  • EU State judgment:judgments issued in another EU state, once they become enforceable, circulate within the EU legal area and are therefore automatically recognised and can be enforced in Portugal under EU law.
  • European payment order: a uniform procedure valid in all Member States, particularly suitable for uncontested debts.
  • European Account Preservation Order (EAPO):an effective tool for freezing funds in the debtor’s bank accounts in the EU.
  • Local injunction procedure (Injunção): usable for claims up to €15,000, it is a fast, inexpensive and predominantly electronic procedure. In the absence of opposition from the debtor, the injunction becomes immediately enforceable.
  • Ordinary legal action in Portugal:required for amounts over €15,000; it involves longer timescales and higher costs, and is a full trial.

The letter of formal notice from a Portuguese solicitor and the out-of-court phase

Before taking legal action, it is advisable to send the debtor a letter of formal notice to pay, drafted by a Portuguese solicitor and sent by registered post with return receipt. The letter must indicate the parties, the cause of the debt, the amount owed and a deadline for payment, warning of the consequences of non-payment.

This preliminary stage is important because it can lead to an amicable solution or a formalised payment plan, avoiding legal action.

Why rely on an experienced solicitor in Portugal

Ursusnetwork offers comprehensive assistance in international debt collection in Portugal, allowing foreign companies to work with a Portuguese solicitor and choose the most effective strategy to reduce the time and cost of recovery.