Can enterprises use debt collection services?
When outstanding debts remain unpaid for an extended period, many enterprises face cash flow shortages, disruptions to business operations, and increasing financial pressure. In such circumstances, many enterprises may question whether they can engage a third party to assist in debt recovery in order to accelerate the payment process.
However, this issue should be considered based on applicable legal regulations to avoid potential legal risks.
1. Why are enterprises not allowed to use debt collection services?
When debts remain outstanding for several months or even years, enterprises are often concerned that initiating legal proceedings may be time-consuming, costly, and may not result in immediate recovery of the debt. Therefore, many enterprises raise the question of whether debt collection services may be used to assist in the debt recovery process.
However, under current legal regulations, debt collection service businesses have officially been prohibited under Article 6 of the Investment Law 2020 (currently regulated under Article 6 of the Investment Law 2025). Therefore, any individual or organization providing debt collection services is acting in violation of the law.
However, in practice, certain individuals or organizations may continue operating debt collection activities under alternative forms such as “debt recovery support”, “bad debt handling”, or “financial consulting”. Such activities remain unlawful.
If an enterprise uses these services, it may face legal risks or be subject to review by competent authorities depending on the nature and extent of its involvement in any violations occurring during the debt recovery process.
2. Solutions for debt recovery in compliance with legal regulations
To recover debts in accordance with legal regulations, enterprises may either handle the matter themselves or use legal services provided by lawyers or law-practicing organizations.
Lawyers and law-practicing organizations are legally qualified to provide legal services, including but not limited to legal advice and representation for enterprises during the debt recovery process.
2.1. Negotiation stage
At the negotiation stage, lawyers may assist enterprises in reviewing documents, assessing the debt status and likelihood of recovery, and developing an appropriate recovery strategy.
Based on such assessment, lawyers may represent enterprises in sending letters of demand, or directly communicating and negotiating with debtors.
The involvement of lawyers often creates pressure on debtors regarding their payment obligations while helping enterprises save time and costs and minimize negative impacts on business relationships between the parties.
2.2. Litigation and enforcement stage
In cases where debtors intentionally delay payment, evade obligations, or refuse to cooperate, enterprises may initiate legal proceedings and request competent authorities to resolve the matter in accordance with the law.
At this stage, lawyers may continue supporting enterprises by preparing litigation documents, developing legal strategies to protect their interests, and participating in legal proceedings as representatives or legal counsel for the enterprise.
Furthermore, after a legally effective judgment or decision has been issued, lawyers may continue accompanying enterprises during the enforcement stage to facilitate the actual recovery of the debt.
2.3. Summary of the legal solution
Accordingly, where an enterprise wishes to seek support from a third party for debt recovery purposes in order to ensure efficiency and save time, the enterprise may use legal services provided by lawyers or law-practicing organizations to protect its lawful rights and interests while controlling risks and maintaining business stability.
3. When should enterprises use legal services for debt recovery?
Debt recovery services with support from lawyers or law-practicing organizations become particularly necessary when the debt amount is substantial, has remained unpaid for many months and seriously affects business operations, or where the debtor refuses to cooperate or intentionally avoids payment obligations.
In such situations, adopting an unstructured approach or inappropriate measures may further complicate the debt recovery process.
3.1. When disputes arise regarding payment obligations
Additionally, where the parties have failed to reach agreement regarding payment obligations or responsibilities for performance, enterprises should seek legal support at an early stage so that lawyers can assess documents and prepare an appropriate strategy.
Early legal involvement often helps enterprises minimize mistakes, improve negotiation effectiveness, and better protect their interests in the event of disputes.
3.2. When the debtor intentionally avoids payment
In particular, where debtors intentionally avoid payment, prolong the process, or demonstrate a lack of good faith in fulfilling payment obligations, lawyers may assist enterprises in applying appropriate legal measures, including initiating proceedings before competent dispute resolution authorities.
This approach complies with legal regulations while also helping enterprises better protect their lawful rights and interests throughout the debt recovery process.
4. Contact for legal consultation
If your enterprise is considering debt recovery options or requires support for lawful debt collection, please contact TNTP lawyers for consultation on suitable, effective, and reliable solutions for your business.
Sincerely,
