Debt recovery in Baltics: Latvia, Lithuania
The most popular form of covering debt in Lithuania and Latvia through the court is the Compulsory Execution of Obligations in Accordance with Warning Procedures. This form is the most popular because in the case the debtor has not any objection against the debt and is reachable in his address. In Latvia the length of the process will take about 1,5 month and it the cheapest (2% of the amount of the debt but not exceeding ~498 EUR). In Lithuania the length of the process will take about 1,5 month and it is the cheapest (the stamp-duty is ¼ of the claim value. In case the application is denied it is possible to continue ordinary court proceeding without lost of the paid state fee.
In Latvia if the amount of the debt is less than ~ 2122 EUR, and in Lithuania if the amount of the debt is less than 5000 LTL (~ 1448 EUR) the recovery of the debt is possible by Simplified procedure for a Small Amount Claims that offers faster possibility of in written form.
Court proceedings in Latvia might be time consuming proceeding: in the first instance might be 1,5 years long, final decision can be reached within 3-5 years
If the litigation proceeding is started there it would be required to provide yourself from the possible negative actions of the debtor and to ask court on the applying of temporary protection measures. Therefore if the property and bank accounts of the company would be arrested it is possible to ensure that in case of the positive judgment the debtor will have a property that might be collected for recovering of the debt. The application on applying of the temporary protection measures is possible to submit in any moment of the litigation or even prior the term of the due date in case the debtor avoids from covering of the debt and starts to alienate the property, is not available in his legal address and executes other illegal activities. The decision of the court might be implemented promptly by the bailiff.
Court proceedings in Lithuania court proceedings in first instance can take from 2 to 9 months and final adjudication is approximately within 2 or more years. Legislation provides possibility to protect oneself from the negative actions of the debtor and to ask court to apply the temporary protection measures. Therefore if the property and bank accounts of the company would be arrested it is possible to ensure that in case of the positive judgment the debtor will have property or funds secured for covering the sum adjudged by the court. Submission of the application for the temporary protection measures is possible at any stage of the litigation or even prior the submission of the claim. The decision of the court might be implemented promptly by the bailiff.
In Lithuania and Latvia one of the possibilities how to get back money might be submitting of the application on the debtor insolvency or at least to send them warning letter on starting of the insolvency proceeding if the debt will be not covered within 3 weeks period. This is very serious and effective mean in case the debtor would not like to go on bankrupt. But it is necessary to remember that in case of starting insolvency proceeding, grows of the debt will stop and will be required to divide the recovered money with other creditors. Insolvency proceeding might take few years. The state fee in Latvia is ~1068 EUR.
Also there is European Small claims procedure in case creditor and debtor are in different countries and the claim is not exceeding 2000 EUR. The procedure is written and oral hearing is only an exception. This procedure is rather fast since the judgement has to be recognized and enforceable in any Member State.