Debt Recovery from a Foreign Company

Debt recovery from a foreign company is one of the most pressing challenges faced by businesses operating in Ukraine and represents a complex category of international disputes. Such matters combine issues of contract law, international jurisdiction, currency regulation, and cross-border enforcement of court and arbitral decisions. Failure by a foreign partner to refund payments for goods delivered or services rendered, delays in delivery despite timely advance payment, or a complete refusal to perform contractual obligations may result not only in direct financial losses and potential tax penalties, but also in serious strategic risks affecting the future development of the business.

Jurvneshservice provides comprehensive legal support in debt recovery matters involving foreign companies. Our services include contract analysis, pre-trial dispute resolution, assessment of available interim relief measures, court and arbitration proceedings, and enforcement of decisions against non-residents, both in Ukraine (where assets are available) and abroad.

The vast majority of international debt disputes arise from foreign trade contracts for the sale of goods or the provision of services entered into by Ukrainian businesses with foreign counterparties. The terms of such agreements determine the legal nature of the debt, the scope of the parties’ liability, and the permissible methods for protecting the creditor’s rights.

At the initial stage, we conduct a legal analysis of the contract to:

• determine the scope of the parties’ contractual obligations;
• identify liability provisions applicable in the event of breach;
• assess penalties, liquidated damages, and other contractual remedies;
• review governing law, jurisdiction, and dispute resolution clauses;
• evaluate the expected costs of dispute resolution and enforcement.

We place particular emphasis on determining the type and extent of the foreign party’s liability for breach of obligations under a foreign trade contract. This includes not only identifying whether the contract provides for liquidated damages, penalties, or fines, but also calculating their amount, assessing the possibility of recovering damages in excess of contractual penalties, and identifying any limitations of liability, including force majeure clauses. This analysis allows us to develop a realistic legal position and select an effective debt recovery strategy against a foreign counterparty.

As a rule, arbitration clauses require the parties to attempt amicable settlement before initiating arbitration proceedings. In some cases, such settlement efforts are a mandatory precondition to filing a claim in international commercial arbitration. Properly prepared pre-claim correspondence often proves decisive in recovering funds from a foreign partner.

We formulate a clear legal position in pre-claim communications, document contractual breaches, establish deadlines for voluntary repayment, and create a solid evidentiary record for subsequent proceedings against foreign companies. As part of the selected recovery strategy, we also assess the availability of interim relief measures, including the attachment of assets, bank accounts, or the foreign debtor’s corporate rights.

Common grounds for debt claims include refusal by the counterparty to deliver goods, partial performance by a non-resident, or delivery with material deviations from contractual terms. In such cases, it is critical to properly qualify the breach and assess its legal consequences for both the foreign company and the Ukrainian business.

Delays in performance, failure to refund advance payments, or evasion of payment for goods or services require a thorough legal assessment based on applicable law and international practice.

We calculate the principal debt, damages, penalties, and liquidated damages that may be claimed, and assess the realistic prospects of recovery.

Where pre-trial settlement does not produce results, debt recovery proceeds through litigation or arbitration. The choice of jurisdiction and enforcement mechanism is critical to the case’s success.

Many foreign trade contracts provide for dispute resolution through international commercial arbitration. Jurvneshservice represents clients in disputes with foreign companies before international arbitral institutions, providing full legal support throughout the proceedings.

We prepare statements of claim and arbitration requests, develop a coherent legal strategy, structure the evidentiary record, and represent clients at all stages of the proceedings.

Our legal support covers the entire arbitration process—from the initiation of the dispute to the issuance of the arbitral award and subsequent steps related to its enforcement.

A key element of any international debt dispute is the strategy for actual recovery. We analyze:

• the location of the debtor’s assets;
• the availability of interim relief and security measures;
• the prospects for recognition and enforcement of court and arbitral decisions.

Special attention is given to procedures for enforcing foreign court judgments and arbitral awards.

Jurvneshservice combines extensive experience in international disputes, hands-on work with foreign debtors, and a strategic approach to fund recovery. The quality and effectiveness of our work are confirmed by client feedback from those who have completed the full process—from contract analysis to successful debt recovery—in Kyiv, across Ukraine, and internationally.