In Italy, before a creditor can collect a debt, they must first request payment from the debtor in writing or orally. If no response is received from the debtor, the creditor can request that a lawyer send a payment order to the debtor.
The lawyer will send the payment order to the debtor by registered mail. Essentially, this letter is a non-judicial notification that the debtor's debt has been officially demanded.
If the debt is not paid within 7-10 days from the date the payment order is received, the creditor can apply to a bailiff. The bailiff will issue a payment order, which notifies the debtor that payment must be made within 10 days from the notification date.
In Italy, the debtor must file an objection within ten days of the notification date of the payment order to contest it. If no objection is filed within this time frame, the payment order becomes final. However, in some special circumstances (e.g., if the debtor proves that the payment order was not served, or presents documents showing that the debt has been fully paid), the objection period can be extended.
If the debtor does not file an objection to the payment order, or if their objection is rejected, the creditor can initiate enforcement proceedings based on the payment order by filing a lawsuit with the court. When the court receives the application, it will review the dispute between the debtor and the creditor and issue a judgment.
As a result of enforcement proceedings, the debtor's assets may be seized. The court may order the sale of the debtor's assets or may demand direct payment from the debtor's wages or bank account.
Additionally, in Italy, instead of seizing the debtor's assets, mediation can be used to resolve the dispute between the creditor and the debtor. If an agreement is reached through mediation, a payment plan can be established between the parties, and enforcement proceedings can be suspended if the plan is followed.
If the debtor files an objection to the payment order, the court will review the case and issue a decision. If the court accepts the debtor's objection, they will not be required to pay, and the creditor will not be able to collect the debt. However, if the court rejects the debtor's objection, the payment order becomes final, and the debtor must pay the debt.
If the debtor objects to the payment order, the legal process is halted, and the creditor cannot proceed with debt collection until a court decision is made. However, once the court decision is final, the creditor can begin enforcement proceedings to collect the debt.
There are two types of enforcement proceedings in Italy:
In Italy, if a debtor does not respond to a payment order or fails to make payment, the creditor can initiate the seizure process. The seizure order issued by a court-appointed officer aims to collect part or all of the debtor's assets.
The first step in a seizure process is to record the debtor's movable or immovable property in the registry where the property is registered. Then, the court-appointed officer carries out the seizure process on the debtor's assets.
A seizure can be applied to the debtor's movable assets, such as bank accounts, vehicles, real estate, or other property. The debt can be collected by selling the seized assets.
For immovable assets, the process starts with a court decision being registered in the registry. Then, the court-appointed officer carries out the seizure process on the property, which is sold through the execution process.
In Italy, the seizure process follows predetermined procedures, and the debtor's rights are respected. The debtor can contest the seizure and has the right to hire a lawyer during the legal process.
A foreigner can initiate an execution process in Italy, but the court may require a security deposit to cover the foreigner's legal expenses. This security deposit is determined by the court and is paid by the creditor. Once the deposit is paid, the foreigner can start the execution process.
In Italy, a debtor's bankruptcy can be requested if the debt is due and the total amount of the claims to be paid exceeds €30,000. If the bankruptcy request is accepted, the debtor's assets are liquidated, and the creditors' claims are paid.
In cases where a debtor fraudulently conceals assets, the cancellation of the transaction (revocatoria) is possible. A revocatoria can be filed if the debtor disposes of an asset worth less than the debt owed to the creditor, causing harm to the creditor. A revocatoria can also be filed if the asset was transferred, sold, mortgaged, or subject to other legal transactions for fraudulent purposes. In such cases, the creditor can file a revocatoria within two years of the transaction.
The statute of limitations for debt in Italy is ten years.
If you have a claim in Italy and want to initiate bankruptcy proceedings against a debtor or collect a debt from a bankrupt person or company, you can contact our office, get more detailed information, and arrange a meeting with our partner law firms in Italy.