Debt Collection in Argentine

Practical Guide

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Is there a minimum amount to start a legal action?

No, there is not a minimum amount in order to start legal action. The legal system tries to guarantee full access to each person for protecting its rights.

Will the amount due condition the type of procedure?

No, the amount does not condition the type the procedure. The procedure is determined by the quality and quantity of the evidences the claimant submits to the court, and the evidence later produced within the framework of the process during the evidence period.

Is it mandatory to send a warning letter before taking legal action to collect a debt?

It is not mandatory to send a warning letter before starting legal action, but it is convenient to proceed in that way because of a very simple reason: our legal system considers that the action is duly started and exerted at the moment you sent such legal communication. Besides, it is interpreted that your right is preserved regarding the statute of limitation.

What are the best practices for creditors to increase the possibility of recovering the debt?

There are many ways to perform such purpose (example: injunction, lien).

How can a foreign creditor start a procedure for international debt collection in Argentine?

It is important to highlight that the jurisdiction in order to start a certain legal procedure is frequently fixed by the place where the contract is executed and by the address of the parties. Therefore, it is no possible to start legal actions in any place and the claimant has to analyze such matter previously to start any procedure.

Which documents are necessary for debt collection in Argentine?

In order to start legal actions it is important to gather the following documents:

  • a power of attorney granted by the claimant (such document allows the attorney to start and continue any legal procedure on behalf of the client);
  • the loan contract or any document containing the amount to be paid, interests and all the relevant issues that ruled the legal relationship between the parties;
  • in case the debtor has signed an executive title (v. gr. checks, promissory notes, etc), it is important to evidence the origin of the debt and to prove the circumstances in which the title was created.

What happens after the first demand for payment?

If the court decides that the process shall be conducted as an ordinary process, the parties will be in possibility to offer and produce all the relevant evidences (for instance expert witnesses) in order to prove the existence of the debt and the due amount that shall be paid.

If the claimant is basing its claim on a credit title (for example: check or promissory note), the court may ask the claimant to prove the origin of the debt regarding Consumer Act number 24.240. Therefore, the claimant will be obliged to provide all the relevant information regarding the creation of the credit title and evidence its cause, submitting to the court all the evidence connected with this issues.

Can interim measures be taken?

In certain cases, taking into account the importance of the breach, the amount of the debt or any other relevant circumstances, the claimant can ask to the court to grant an injunction for preserving its rights during the course of the legal procedure.

If, for any reason, recovery was not possible, is there any other action that the creditor could take to write off such debt in its accountancy?

Any credit that is partially or totally non recover can be included in a balance sheet and financial statement as a loss.

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