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Estonia · Law · SE

376

The Law on Credit Collectors and Buyers

avaldatud riigiteatajasEstonia· Riigikogu· ET

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12 February 2024

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AVALDATUD_RIIGITEATAJAS

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12 June 2024

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Summary

The bill regulates the activities of debt collection companies and related persons, debt buyout financiers, and the activities of debt collection companies are also brought under the control of the Financial Supervision Authority. In Estonia, debt collection companies deal with the collection of various types of debts and/or the purchase of these claims. However, not all debt collection companies fall under the scope of the bill, but only those that deal with loans from banks or other creditors by collecting the resulting debts or by buying them up. Among other things, in addition to consumer credit, the bill also applies to activities related to debts arising from bank loans granted to entrepreneurs. Therefore, both the title of the draft and the content of the draft define debt collection companies and persons related to them as credit debt collectors. However, it is known that the majority of debt collection companies established and operating in Estonia deal with the collection of debts arising from credit agreements and therefore, it can be assumed that the law will apply to a larger part of the Estonian debt collection market in the future. However, if a debt collection company deals, for example, only with the collection of fines or maintenance arrears, the bill does not apply to such debt collection company. It is estimated that the bill would apply to about 7-8 debt collection companies operating in Estonia. According to the bill, debt collection companies must apply for an operating license from the Financial Inspectorate, which is also granted to the Financial Inspectorate the authority to supervise credit collections, including various sanctioning options (from injunctions to misdemeanor proceedings). A minimum capital requirement of 25,000 euros and separate rules on how the credit collection agency must keep funds received from debtors are provided for. Reliability requirements for managers and owners of credit collections are also provided for, e.g. the requirement that the manager of credit collections cannot be a person who has previously dealt with usury.

Machine translation from Estonian. The official text remains authoritative.

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