Overseas customer not paying? How UK businesses recover international debts

When a customer abroad stops paying, two facts decide almost everything: where the debtor and its assets are, and what your contract says about governing law and jurisdiction. Most overseas debts are recovered without any court at all, by a demand in the debtor’s own language from an agency with local reach, because that is the first contact a foreign debtor cannot easily ignore. Since Brexit an English judgment is no longer automatically enforceable across the EU; the Hague Judgments Convention helps for claims started from 1 July 2025, but suing where the debtor’s assets are is often the simpler route. Time limits abroad can be much shorter than the six years you have in England and Wales, as little as three years in Germany, so an overseas debt should never be left to drift. The rest of this guide works through each stage in the order that costs least.

The two facts that decide your options

Where the debtor is, and where its money is. These are not always the same place. A French company with a UK bank account and UK customers can be pursued very differently from one whose only assets are in France. Enforcement happens where assets are, so everything else follows from this.

What your terms say. Four clauses matter more than any others when a customer is abroad:

• Governing law. Which country’s law decides the contract. It controls the interest you can claim, how long you have to sue and what counts as a valid demand.
• Jurisdiction. Which country’s courts can hear a dispute. An exclusive jurisdiction clause in favour of the courts of England and Wales, or Scotland, or Northern Ireland, is what lets several of the options below work.
• Currency. An invoice in sterling puts the exchange risk on the customer. An invoice in euros or dollars puts it on you, though English courts can give judgment in a foreign currency, so a claim is not lost by it.
• Retention of title. A clause keeping ownership of goods until they are paid for is recognised in many countries but not all, and the rules on what it covers differ. Where it works, it can mean recovering the goods rather than chasing the money.

If your terms were never agreed, or the order went through on the customer’s purchase terms instead of yours, the answers may be different from what you expect. It is worth establishing this before sending anything, because the demand you send should rest on the law that actually governs the debt.

Start with a demand the debtor will read

The first step is the same as for any unpaid invoice: a clear, quantified demand with a deadline. Two things change when the customer is abroad.

Quantify under the right law. If your contract is governed by the law of part of the UK and you supply from here, the Late Payment of Commercial Debts (Interest) Act usually applies even though the customer is overseas, so you can add statutory interest at 8% plus the Bank of England base rate and fixed compensation of £40, £70 or £100 per invoice. If the contract is governed by an EU country’s law, that country’s implementation of the EU Late Payment Directive gives broadly equivalent rights: interest of at least the European Central Bank reference rate plus eight percentage points, and at least €40 compensation per invoice. Elsewhere, look to the contract and local law.

Make it readable. A demand in English from a UK company to a finance department in Lyon or Munich is easy to set aside. Send it to a named person, in their language as well as yours if you can, with the invoice, the statement of account and a deadline expressed as a date rather than a number of days. The free late-payment calculator quantifies a UK-law debt and drafts the letter before action; a professional translation of the key paragraph costs little compared with the debt.

Then set a date for escalation and keep to it. Overseas debtors are, if anything, more inclined than domestic ones to test whether a foreign creditor will actually follow through.

Why an international agency usually comes next

The distance that makes an overseas debt hard to chase yourself is exactly what an international collection agency removes. Agencies that do cross-border work either have their own people in the debtor’s country or work through a network of local partner agencies and lawyers. The debtor then hears from someone local, in their own language and time zone, who can cite local law and who can start local proceedings if the amicable stage fails. That is a different conversation from an email from a supplier they may never see again.

What to expect:

• The amicable stage first. Letters and calls through the local partner, negotiation, payment plans where appropriate. Many agencies still work on no-collection-no-fee terms at this stage.
• Higher fees than domestic work. A partner in the debtor’s country takes a share, so commission is usually higher than on UK debts, and it varies more by country. The general rules in debt collection agency fees explained still apply: get the price in pounds for this debt, and read the no-win-no-fee small print on what counts as collected.
• Legal costs on top if it goes further. If the debtor will not pay without being sued, local lawyers’ fees and court costs are normally charged separately and are often payable whatever the outcome. Ask at the start what that stage would cost in the debtor’s country.

When comparing agencies for an overseas debt, the questions that matter are which countries they cover directly, which through partners, how long they have worked with those partners, and who would conduct any proceedings. An agency that answers “we cover everywhere” without naming how is telling you something. The general creditor’s guide to choosing an agency covers the rest, and what happens once you instruct covers the handover pack, which for an overseas debt should include the contract, the terms the customer accepted, and any correspondence in the debtor’s language.

Suing: here or there?

If the amicable stage fails and the debtor can pay, the choice is whether to sue in the UK and enforce abroad, or to sue in the debtor’s country. The deciding question is whether a UK judgment will be recognised where the debtor’s assets are.

Three practical points sit behind the table. First, if your terms give the courts of England and Wales jurisdiction, you can usually serve a claim on a defendant abroad without first asking the court’s permission, which removes a step that used to add cost and delay. Second, many countries have their own fast-track procedure for undisputed money claims, Germany’s Mahnverfahren and France’s injonction de payer among them, and foreign creditors can use them through local lawyers. Third, if the debtor has assets in the UK, a UK judgment enforced here is the simplest of all, using the ordinary tools covered in county court bailiffs vs High Court enforcement officers.

If the debt is genuinely disputed, the choice between an agency and legal advice is the one set out in debt collection agency or solicitor?, with the added question of which country’s lawyer you need. And if the debtor has entered insolvency abroad, the local insolvency process governs, much as it would at home; what creditors can do when a debtor company fails explains the logic, though the procedure will be local.

Is it worth pursuing?

An overseas debt costs more to recover than a domestic one, so the size threshold at which it is worth pursuing is higher. As a rough guide, a small overseas invoice is often best dealt with by a firm demand and, if that fails, an agency on no-collection-no-fee terms, with legal action reserved for sums where local lawyers’ fees are a modest fraction of the debt. The calculation should include the fees at each stage, the exchange rate, the time to a result, and the chance that the debtor can actually pay. A debt owed by a trading company with assets and a reason to keep its reputation in your market is worth considerably more than the same sum owed by a company with neither.

Two things improve the odds. Acting early: the chance of recovering any debt falls as it ages, and an overseas customer who has started prioritising local suppliers over foreign ones will not reverse that without pressure. And being specific: a demand citing the governing law, the exact interest and a real deadline is taken more seriously than a reminder.

Watch the time limits

Limitation periods follow the law that governs the debt, and they vary a great deal. In England and Wales a contract debt can generally be pursued for six years from when it fell due. Germany’s regular period is three years, counted from the end of the year in which the claim arose. France’s is generally five years. In the United States the period depends on the state and the type of contract. Scotland’s is five years and extinguishes the debt rather than merely barring the claim.

If your contract chooses the law of a UK jurisdiction, UK limitation rules will usually govern, but that is a question to check rather than assume, particularly where the order went through on the customer’s terms. The safe course with any overseas debt is to treat the shortest plausible period as the real one.

Protect the next overseas sale

Almost everything that makes an overseas debt hard to recover can be reduced before the order is taken:

• Take a deposit or payment in advance from new overseas customers until they have a payment record with you.
• Use a letter of credit or documentary collection on larger export orders, so a bank stands between you and non-payment.
• Consider trade credit insurance, which covers the risk of an overseas customer not paying and often includes collection support. UK Export Finance also supports exporters where private cover is not available.
• Credit-check overseas customers through an agency with international data, and re-check when order values rise.
• Put the right clauses in your terms: UK governing law, an exclusive jurisdiction clause for UK courts if that suits you, an interest rate for late payment, retention of title, and the invoice currency. Make sure the customer accepts your terms rather than you accepting theirs.
• Know when to hand over. The same trigger that applies at home applies abroad, only sooner, and when to move a debt from in-house chasing to an agency sets out how to write one.

Within the UK is not overseas

A customer in Scotland or Northern Ireland is not an overseas debtor, though the legal systems differ. Judgments move between the three UK jurisdictions by registration rather than fresh proceedings, agencies cover all three on the same terms, and the main differences are the courts, the enforcement officers and the limitation periods, which our regional pages cover.

The short version

Start with your terms and the debtor’s location, because they decide which law, which courts and which time limits apply. Send a quantified demand the debtor will actually read, then instruct an agency with local reach in the debtor’s country rather than chasing from a distance. Sue only where the debtor can pay, and follow the assets: a UK judgment is valuable where a convention or local law recognises it, and local proceedings are often simpler where not. Act early, and treat the shortest possible limitation period as the one that applies.

If your customer is abroad, you can compare vetted UK debt recovery agencies on Collect Compare: choose “Outside the UK” as the debtor’s location and you will only see agencies that list international recovery, with names hidden until you choose. Or let us match you to the right one. It is free for creditors: the agency you choose pays for the introduction, and no agency can pay to rank.

This is general information, not legal advice. Cross-border recovery depends on the countries involved, the terms of your contract and when proceedings are started, so take advice on your specific debt before issuing anything abroad.