Late payment by the buyer is a common problem in commercial transactions and can cause many difficulties for the seller.

This article was consulted by Lawyer Nguyen Quang Trung

From a legal perspective, the seller needs to take some measures to protect its rights. Below is a detailed analysis of what the seller should do when the buyer is late in payment:

1. Clearly define the payment terms in the contract

First of all, the seller needs to ensure that the signed sales contract has clear and detailed payment terms. This includes the payment term, payment method, and measures to handle when the buyer is late in payment. This gives the seller a solid legal basis to request the buyer to fulfill its payment obligations.

2. Send a payment reminder notice

When the buyer is late in payment, the seller should send a payment reminder notice. This notice should be sent in writing and clearly state the outstanding amount, the agreed payment term, and request the buyer to pay within a certain period of time. Sending a reminder notice provides the seller with evidence that the buyer has been asked to fulfill their payment obligations.

3. Applying late payment interest

The seller always has the right to request the buyer to pay late payment interest. Late payment interest is a measure to encourage the buyer to pay on time and partially compensate the seller for the loss caused by late payment.

4. Negotiation and bargaining

In some cases, negotiation and bargaining can help resolve the problem of late payment peacefully and effectively. The seller can propose solutions such as extending the payment period, dividing the debt into smaller amounts to pay gradually, or reducing a portion of the debt if the buyer pays immediately. Negotiation and bargaining help maintain a good relationship between the two parties and avoid complicated legal disputes.

5. Use professional debt collection or debt trading services

Debt collection and debt trading companies have experience and skills in debt collection and can help the seller recover the debt effectively.

However, it should be noted that according to the Investment Law 2020, the debt collection service industry is prohibited. Therefore, during the period when the debt collection industry is prohibited, the seller cannot hire this service. However, if the law is more open in the future, the seller can consider this service.

In addition, the law does not prohibit debt trading. Therefore, the seller can sell its debt if there is a party willing to buy the debt.

6. Sue a lawsuit in court or commercial arbitration

If all of the above measures are ineffective, the seller can sue the buyer in court or commercial arbitration to request payment of the debt. The lawsuit must be carried out in accordance with legal procedures and the seller must fully prepare evidence of the buyer’s late payment. The court or commercial arbitration will review and issue a judgment requiring the buyer to pay the debt, which may include late payment interest and legal costs.

7. Use of security measures

In some cases, the seller may require the buyer to provide security measures such as a deposit, a bank guarantee, or a mortgage to ensure payment. These security measures help the seller minimize the risk of the buyer being late in paying and can recover the debt through these security measures.

8. Understand and comply with the law

The seller needs to have a good grasp of the legal regulations related to the purchase and sale of goods and payment to protect its rights. Understanding the law helps the seller to apply legal measures effectively and avoid unnecessary legal risks.

9. Consult with a lawyer

In complex cases, the seller should seek advice from professional lawyers. Lawyers can help the seller assess the situation, propose appropriate legal measures, and represent the seller in legal disputes. Consulting with a lawyer helps the seller make the right decisions and protect their interests effectively.

10. Building a good relationship with customers

Finally, building and maintaining a good relationship with customers is an important factor in minimizing the risk of late payment. The seller should regularly communicate with customers, understand their needs and difficulties, and seek cooperative solutions to resolve payment problems. A good relationship helps the seller and the buyer to resolve issues peacefully and effectively.

Conclusion

Late payment by the buyer is a common problem and can cause many difficulties for the seller. However, by applying appropriate legal measures, the seller can protect its rights and collect the debt effectively. Clearly defining payment terms in the contract, sending reminder notices, applying late payment interest, negotiating and bargaining, using professional debt collection services, filing a lawsuit, using security measures, learning and complying with the law, consulting with a lawyer, and building a good relationship with the customer are important measures that the seller should take when the buyer is late in payment.