Chinese Business Delegation Learns About U.S. Collections
For 20 years, the United States – China Exchange Council (USCEC) has hosted delegate exchanges between the U.S. and China for the purposes of education, commerce, and friendship.
Because of his experience with multiple industries and his extensive knowledge of both U.S. and international commercial collections, Dean Kaplan was recently asked to speak to a group of Chinese delegates about the U.S. collections system. The Chinese are actively trying to build on their current debt collection practices and create a uniform system for the country similar to the Uniform Commercial Code and debt collection laws in the U.S.
The meeting was originally scheduled to take 90 minutes but instead lasted over three hours due to questions and impromptu conversation. Much of the information Dean shared with the delegates is information that we try to share everyday with our clients. Dean spoke about:
- Laws Impacting Credit & Collection
- Collection Agency Regulations
- Bankruptcy Laws
- Extending Credit to a Business (the delegation was very interested to learn more about the general Internet research we do on companies to determine their reputation)
- Credit Applications and Common Mistakes with Credit Applications
- Collection Litigation
- Our Process at The Kaplan Group
As always, Dean tried to impress upon the group the importance of acting quickly if a company fails to pay promptly. He also shared our extensive resource center with the group.
Current laws in China are much more favorable to the creditor than they are to the person who owes money. Unlike here in the U.S., debt collectors are not only allowed to go visit a company or individual to collect money, they are also allowed to attempt to harass or embarrass debtors into paying what is owed. Personal liability for commercial debt is much more prevalent in China than it is here in the U.S. In the U.S, you have to have a personal guarantee or the business has to be a proprietorship for there to be personal liability.
In China, there is also no statute of limitations on collecting on a debt, and no limit on interest rates. The Chinese visitors were surprised to learn that we at The Kaplan Group are frequently successful at collecting debt despite all the regulations that favor the debtor. They were shocked that over 97% of our successful collections was accomplished without going to court.
At The Kaplan Group our main goal is to be helpful. Whether you’re a company or an entire delegation, we’re happy to talk to you about your collections needs and the collections process.
About The Author:
Dean Kaplan is Principal at The Kaplan Group. Dean's expertise is widely recognized in the debt collection industry. His advice has been published in a number of industry newsletters such as Credit Today and InsideARM and he is a frequent speaker at industry events.