In commercial and transport transactions, the phrase “debt recovery at the debtor’s expense” can be misleading. Under Polish law, a creditor may be entitled to recover certain costs incurred when pursuing an overdue payment, but those costs are not automatically transferable to the debtor in full.

Under Article 10 of the Act on Counteracting Excessive Delays in Commercial Transactions, creditors are entitled to a fixed compensation of €40, €70 or €100, depending on the amount of the outstanding payment. For a claim of PLN 9,500, for example, the applicable fixed compensation is the equivalent of €70.

This fixed compensation does not require the creditor to prove that it actually incurred corresponding recovery expenses. However, additional costs exceeding the statutory compensation are subject to different rules.

Under Article 10(2), the creditor may seek reimbursement of debt-recovery costs that were actually incurred and are justified in amount. This means that an invoice issued by a collection agency, or the fact that the creditor entered into an agreement with such an agency, does not automatically establish the debtor’s liability for the full amount.

Courts may examine whether the costs were necessary, proportionate and directly connected with recovering the particular debt. Relevant factors can include the complexity of the case, the number and nature of recovery activities, the time spent and the relationship between the costs and the value of the claim.

Recent Polish court decisions illustrate this distinction. In one case, the court found that an invoice and proof of payment demonstrated that recovery costs had been incurred, but did not establish that the full amount was necessary or proportionate. In another case, the court questioned whether the cost of a routine payment demand could be recovered separately when such activity fell within the standard costs already covered by the statutory lump sum.

The method used by a collection agency to calculate its fee is also not decisive. A percentage-based commission may be valid between the creditor and the collection company, but it does not automatically determine the amount that can be claimed from the debtor. Where similar recovery activities generate substantially different fees solely because the underlying debt is larger, the creditor may need to demonstrate why the higher cost is justified.

Particular issues may also arise where a debt is assigned to a collection company and subsequently reassigned to the original creditor. In such cases, the parties’ contractual arrangements do not necessarily determine which costs qualify as recoverable under Article 10(2).

For creditors seeking reimbursement beyond the statutory lump sum, the practical lesson is clear: they should be prepared to document the activities undertaken, the costs actually incurred, their connection with the recovery of the debt and the reasons why those costs were reasonable.

For debtors, this means that a demand for additional collection costs can be examined rather than accepted automatically. The key question is not simply whether a collection agency was engaged, but whether the particular costs claimed were actually incurred, necessary and justified in the circumstances.

Ultimately, Polish law distinguishes between the fixed compensation for late payment and additional debt-recovery costs. While the former is generally available without proof of actual expenditure, the latter requires a considerably stronger evidentiary basis and must satisfy the statutory requirement of being incurred and justified in amount.

Author: Ewa Sławińska-Ziaja, Attorney-at-law, Trans Lawyers

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