Uzbekistan: Extrajudicial debt collection

published on 23 September 2024 | reading time approx. 2 minutes

Extrajudicial debt collection in Uzbekistan always begins with a comprehensive assessment of the debtor's solvency. This includes an assessment of the debtor's financial situation, business activities, company history, and the availability of documentary evidence of the debt. It is particularly important to ensure that there are no pending court proceedings or judgments against the debtor and that the debtor is still actively engaged in business activities.

During this phase, intensive negotiations are conducted to reach a settlement or explore alternative repayment options. Communication with the debtor is initiated immediately after a written demand for payment is sent by registered letter and email. It is crucial to confirm the receipt of the payment request within a week.

Throughout the entire process, continuous pressure is exerted on the debtor to ensure that the debt is settled quickly. The aim is to establish contact with the relevant decision-makers in order to press ahead with debt collection. The average duration of an out-of-court debt collection procedure is up to two months, unless an installment payment plan is agreed. If this phase does not lead to success or appears to be inappropriate after an initial review, legal action will be taken.

If the debtor is in default for 30 days or if a contractual agreement states otherwise, an immediate reminder (reminder letter) must be sent setting a deadline. There is no legally prescribed deadline, and the contracting parties are free to agree a deadline within the framework of dispositive law. In Uzbekistan, the general limitation period for claims is three years. A shortening or extension of this period by contractual agreement is governed by law, as it is a matter of mandatory law (ius cogens).

If the debtor fails to make any payments after a deadline has been set or does not take any measures to settle their debt, such as returning goods, assigning the debt to a third party or exchanging goods or services, legal action must be initiated. Uzbek legislation provides for three possible methods of judicial debt collection: the issuance of a court order, ordinary proceedings or simplified proceedings.

Once a final judgment has been issued and the debtor still refuses to pay, coercive measures can be taken in accordance with Article 232 of the Criminal Code of the Republic of Uzbekistan. This article regulates the circumvention of the enforcement of court decisions, in particular with regard to the collection of monetary claims.

Should you require assistance with out-of-court debt recovery in Uzbekistan, we are happy to assist you as an international law firm with extensive expertise in this area and offer you legal assistance.