Legal Document Translation, Foreign Jurisdictions and International Debt Collection

We’ve blogged about professional legal and corporate translation and interpretation services in the context of foreign insolvency proceedings. The basic tool of debt collection is the demand letter. However, this basic legal tool becomes more complex when the demand for payment pertains to a company based in a foreign country. At the very foundation of the complexities is the need for a foreign language translation of the letter, but that is just the beginning of the challenges of debt collecting in a foreign country.

The typical demand letter addressed to an American company is long with considerable attention paid to the facts and applicable law. The letter concludes with a statement on what can be expected from a jury and that it would therefore ‘be in their best interest’ to find a resolution. The response then typically focuses on pointing out the gaps in the demanding party’s case and stating how expensive it will be to collect anything.

Although in the US this process is pretty much scripted, when dealing with a foreign country things change.

Take China, for example. Whereas in American the focus is on arguing to a logical conclusion (a win/win agreement), in China this process does not exist. Instead, the most effective demand letters to a Chinese company usually consist of no more than one or two pages without much attention to the law and the facts. Instead, they set out the fact that company A owes company B X amount, but do not elaborate on the ‘why’. Next, the letter lets the company know in no uncertain terms that if they do not pay, life will be miserable and expensive. The typical response then is to say that they will not pay anything. And of course this all must include a English-Chinese and Chinese-English translation of the above-mentioned documents.

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