Having drawn from the expertise of Atradius Collections' local offices, the International Debt Collections Handbook explains the different regulations and procedures for debt collections in Hungary.
Atradius Collections maintains a professional collection process, focusing on the relationships between our clients and their debtors at all times. Our team of collection specialists carry out the collection process in-house, contacting debtors both verbally and in writing whilst adhering to federal and state laws. In case of any dispute, we aim to reach an amicable solution between the creditor and the debtor. We do this by analysing all contractual documents (e.g. signed contracts, orders, confirmations, invoices and delivery notes, as well as all standard terms that have been agreed upon). All investigations are completed with the assistance and agreement of our legal team. We may decide during the collection process that a personal visit to the debtor would add value, and we are able to do this ourselves in the Budapest area.
Atradius Collections always charges interest to debtors fixed by the Act IV of 1959 in the Civil Code of the Republic of Hungary. From 15th March 2014, a new Civil Code Act V of 2013 came into effect. The regulation of the interest remains the same. According to the law, interest for late payment shall be calculated by the central bank base rate of the issuing country of the currency in effect on the first day of the calendar half-year to which it pertains, plus 8%. If the creditor enquires about a higher interest rate, we can only offer this if it has been confirmed by contractual documents. From a cultural point of view, Hungarian debtors often use the actual amount of the interest payment as a matter of negotiation.
Debt collection costs
Directive 2011/7/EU of the European Parliament and the Council has been incorporated into the Hungarian Civil Code since 15th March 2014, and from 13th February 2016, a new law, Act IX of 2016 Law of Collection costs, came into effect. According to these regulations, we can charge EUR 40 as collection costs to the debtor. Further collection costs are chargeable, but there is no regulation fixed by local law. The basis of any charges must be proven by contractual documents signed by the debtor. From a cultural point of view, Hungarian debtors are not used to paying debt collection costs, and these costs are considered a matter of negotiation.
The Debt Collections Handbook presents a snapshot of Hungary's economic situation and covers the following topics:
- Accepted and most common payment methods
- Types of companies
- Legal procedures
- Enforcement in debt, movable and immovable property
- Insolvency proceedings
To read more about steps and procedures undertaken in debt collections in Hungary: