Debt Collection from a Company – Legal Guide for Entrepreneurs (2026)

07/04/2026

Intro

Unpaid invoices and payment delays are among the most common problems faced by entrepreneurs in Croatia. If another company owes you money, it is important to act promptly and use the legal mechanisms available to you.

In this guide, we explain how to collect a debt from a company – quickly, legally, and efficiently.

When can you initiate debt collection?

You can initiate debt collection once:

the invoice has become due (payment deadline has expired)
there is a contract, invoice, or other proof of the obligation
the debtor has failed to pay despite receiving a reminder

Important: always keep documentation (contracts, invoices, email communication).

Step 1: Sending a pre-action notice

Before initiating legal proceedings, it is recommended to send a formal demand letter (pre-action notice).

The notice should include:

the amount of the debt
a payment deadline (e.g. 8 days)
a warning about initiating legal proceedings

In practice, many debts are resolved at this stage.

Step 2: Enforcement based on an authentic document

If the debtor does not pay, the next step is enforcement proceedings.

You can initiate enforcement if you have:

an invoice
an extract from business records
a contract

The procedure is initiated before:

a public notary (most common)
or the court (in certain cases)

Advantages of enforcement:

fast procedure
lower costs
possibility of blocking the debtor company’s bank account

Step 3: Debtor’s objection – what then?

If the company files an objection:

the procedure continues as litigation
the court decides on the validity of the claim

This may prolong the process, but it does not mean you will not recover the debt.

Step 4: Court proceedings (lawsuit)

If enforcement is not possible or is challenged, civil litigation is initiated.

The court examines:

whether the debt exists
whether the contract is valid
whether the service was performed

Duration:

from several months to several years (depending on complexity)

Step 5: How to collect the debt after a judgment?

If you win the case:

enforcement is initiated based on the court judgment
it is possible to:

block the company’s bank account
seize assets
collect from receivables

Limitation period

A very important question: how long do you have to collect a debt?

3 years – limitation period for claims between companies

After the limitation period expires, the debtor may raise a limitation defence, which prevents enforced collection.

Important: limitation does not occur automatically – the debtor must invoke it.

How to increase your chances of recovery?

Practical tips:

Check the financial standing of business partners before cooperation
Agree on payment deadlines and default interest
Use security instruments (e.g. promissory notes)
Act immediately after payment delay
Engage a lawyer in a timely manner

Most common mistakes by entrepreneurs

Waiting too long
Lack of a written contract
Incomplete documentation
Failure to initiate proceedings on time

When should you hire a lawyer?

It is recommended:

for higher-value claims
when the company disputes the debt
in complex contractual relationships
if you want to speed up the recovery process

A lawyer can:

draft a demand letter
initiate enforcement proceedings
represent you in court
advise on recovery strategy

Conclusion

Debt collection from a company in Croatia can be fast and effective – but only if you act on time and use the appropriate legal tools.

The key to success is:

proper documentation
timely action
correct handling of the procedure

Need help with debt collection?

If you have unpaid invoices or issues with debt recovery, contact a lawyer in time to protect your business.

Do you have any more questions?

A representative from our office will get back to you as soon as possible.