Unpaid invoice or debt — Algeria: how to get paid

Steps to Recover a Debt in Algeria — Overview

Recovering an unpaid invoice or commercial debt in Algeria follows a structured path governed primarily by three texts: the Code Civil algérien (Ordonnance n° 75-58 du 26 septembre 1975, as amended), the Code de Procédure Civile et Administrative (CPCA) — Law n° 08-09 of 25 February 2008, as amended — and the Code de Commerce. The process moves from an amicable phase to a formal notice and, if necessary, to a judicial procedure. Two main fast-track judicial mechanisms exist: the injonction de payer (payment order) and the référé-provision (interim relief order).

The ordinary judicial branch handles civil and commercial debt disputes. At first instance, the tribunal issues a final judgment — which cannot be appealed — for claims that do not exceed 200,000 Algerian dinars (DZD), even if counterclaims or compensation claims exceed that amount. Claims above that threshold can be appealed to the Court of Appeal, and further to the Supreme Court (Cour Suprême) on points of law. The judicial organisation Law n° 22-10 of 9 June 2022 established two judicial systems: the ordinary judicial branch and the administrative judicial branch.

1. Amicable reminder (relance amiable) — informal contact, phone, e-mail, letter
2. Formal notice (mise en demeure) — mandatory pre-litigation step in practice
3. Judicial procedure — injonction de payer or référé-provision
4. Enforcement (exécution forcée) — asset seizure, bank garnishment once an enforceable title is obtained

The Amicable Reminder (Relance Amiable)

Before initiating any legal action, creditors are strongly advised — and in many commercial relationships expected — to attempt an amicable resolution. However, in the absence of an attempt to recover an outstanding debt during and after the contractual deadlines, the company's manager should be consulted. This step is not a formal legal requirement but is standard practice and will strengthen your file if litigation follows.

• Telephone call or e-mail: Contact the debtor, refer to the invoice number, due date, and outstanding amount. Keep a written record of all exchanges.
• Written reminder letter: Send a polite but firm payment reminder by e-mail or registered post. State the exact amount due, the invoice reference, the original due date, and a new deadline (typically 8 to 15 days).
• Electronic invoices as evidence: An electronic invoice is admitted by Algerian courts as evidence, although it is still not widely used in practice. The deadline relating to the settlement of the invoice starts the day after the notification of this invoice.
• Negotiation: Propose a payment schedule if the debtor shows good faith but faces temporary cash-flow difficulties. Get any agreement in writing and signed.

If the debtor does not respond or refuses to pay within the deadline set in your reminder, escalate immediately to a formal notice.

The Formal Notice (Mise en Demeure)

The mise en demeure is a pivotal document under Algerian civil law. It triggers the running of default interest (where contractually provided or legally applicable), creates a paper trail for the court, and demonstrates your good faith. Under Article 180 of the Code Civil, a debtor is in default (en demeure) upon receipt of a formal judicial summons or an equivalent written demand.

Mandatory Contents

• Full identification of both parties: full legal name, address, company registration number (NIF/RC) of creditor and debtor.
• Clear description of the debt: invoice number(s), date(s), amount(s) in DZD, and the contractual or legal basis (contract reference, purchase order, etc.).
• Exact total claimed: principal + any contractually agreed late-payment interest or penalties.
• A precise deadline to pay: typically 8 to 15 days from receipt.
• Express statement that failure to pay within the deadline will result in legal proceedings without further notice.
• Date and signature of the creditor or their legal representative.

How to Send It

• Send by registered post with acknowledgment of receipt (lettre recommandée avec accusé de réception) — this is the preferred method as it proves delivery and the date of receipt.
• Alternatively, have it served by a court bailiff (huissier de justice) for maximum legal weight, especially for large claims.
• Keep the original signed letter, the postal receipt, and the acknowledgment of receipt slip — these are key exhibits in court.

Late-Payment Interest

This is a nuanced area in Algerian law. Article 454 of the Code Civil prohibits interest between individuals in civil matters, reflecting Islamic law principles. However, in commercial transactions between businesses, interest on late payment may be agreed upon in the contract. Interest was found contrary to Algerian public order due to Article 454 of the Civil Code, which prohibits interest between individuals; thus, only the part ordering payment of the principal is enforced in certain cross-border scenarios. In practice, for B2B commercial contracts, parties routinely include a clause pénale (penalty clause) or agree on a specific late-payment interest rate in the contract. In the absence of such a clause, the court may award statutory interest — verify the applicable rate with a local lawyer or the Banque d'Algérie (www.bank-of-algeria.dz), as the legal rate is set by regulation and updated periodically.

The Judicial Procedure: Injonction de Payer and Référé-Provision

If the formal notice goes unanswered, two fast-track procedures are available under the CPCA (Law n° 08-09 of 25 February 2008):

1. Injonction de Payer (Payment Order)

The injonction de payer is preferred for claims of a smaller amount and when the debtor cannot contest the claim. It is initiated by sending a petition (requête) to the tribunal, asking the judge to issue a payment order obliging the debtor to comply. It is an ex parte procedure (the debtor is not summoned initially), which makes it faster.

2. Référé-Provision (Interim Relief Order)

The référé-provision (Article 942 of the CPCA) allows for the rapid recovery of claimed sums. If, once the order is issued, the debtor still does not comply, the creditor can seize the debtor's assets. This procedure is adversarial (both parties are heard) but handled by the juge des référés (emergency judge) and is therefore faster than full ordinary proceedings. It is particularly suited to undisputed or barely disputed commercial claims.

3. Ordinary Proceedings (Action au Fond)

For complex or heavily contested debts, the creditor must file a citation directe or a requête introductive d'instance to initiate full adversarial proceedings before the competent court. The first instance tribunal issues a final, non-appealable judgment for claims not exceeding 200,000 DZD; claims above this threshold can be appealed. Ordinary proceedings are slower but allow full examination of the merits, evidence, and counterclaims.

Enforcement of Judgments

Once an enforceable title is obtained (court judgment, ordonnance d'injonction de payer that has become final, or ordonnance de référé), enforcement is carried out by a bailiff (huissier de justice) and may include:

• Seizure of movable assets (saisie mobilière)
• Bank account garnishment (saisie-arrêt)
• Seizure of real estate (saisie immobilière) for larger debts
• Garnishment of third-party receivables (saisie-attribution)

Costs and Timelines

Important note on costs: Court fees (droits de timbre et d'enregistrement) in Algeria are set by the Finance Law (Loi de Finances) and updated annually. For the current applicable rates, consult the Direction Générale des Impôts (DGI) at www.mfdgi.gov.dz or the relevant tribunal's clerk's office (greffe).

Statute of Limitations

• Commercial debts (between merchants): 3 years under the Code de Commerce (Article 30), running from the date the debt becomes due.
• Civil debts: 15 years under the Code Civil (general rule, Article 308), subject to specific shorter periods for certain categories.
• A formal notice or court filing interrupts (interrompt) the limitation period — a critical reason not to delay.

FAQ

Can I recover a debt in Algeria without a lawyer?

For small claims (below 200,000 DZD), Algerian procedural law allows a creditor to appear in person before the Court of First Instance without being represented by a lawyer (avocat). However, for the injonction de payer procedure and any claim above that threshold — and certainly for enforcement proceedings — engaging a licensed Algerian avocat inscribed at the relevant Barreau (Bar Association) is strongly recommended. The Algerian bar associations (Conseil National du Barreau) can provide a referral. Specialised debt collection agencies operating in Algeria (such as DZACS — www.dzacs.com) also offer end-to-end recovery services including judicial representation.

What happens if the debtor files an opposition against the injonction de payer?

If the debtor files an opposition within 15 days of being served with the payment order, the injonction de payer procedure is automatically converted into ordinary adversarial proceedings (procédure contradictoire). Both parties are summoned, submit their arguments and evidence, and the judge rules on the merits. The creditor must therefore ensure their documentary evidence (contract, invoices, delivery receipts, correspondence, mise en demeure) is solid before filing.

Does Algerian law allow contractual late-payment interest on commercial invoices?

Yes, but with important nuances. Article 454 of the Code Civil prohibits interest between individuals in purely civil matters. In commercial transactions between registered businesses, parties are permitted to contractually agree on a late-payment interest rate or a clause pénale. Without a contractual clause, courts have historically been reluctant to award interest beyond the statutory rate. Always include a clear late-payment interest clause in your commercial contracts and invoices. For the current legal (statutory) interest rate applicable in Algeria, check with the Banque d'Algérie (www.bank-of-algeria.dz), as it is set by regulation and subject to change.

Are foreign judgments and arbitral awards enforceable in Algeria?

Algeria is a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, and the Algerian Code of Civil Procedure allows both private and public sector companies full recourse to international arbitration. Foreign arbitral awards are therefore enforceable in Algeria subject to an exequatur procedure before the competent Algerian court. Algeria also permits the inclusion of international arbitration clauses in contracts. Foreign court judgments (as opposed to arbitral awards) require a separate exequatur application and are subject to conditions under Articles 605–606 of the CPCA, including verification that the foreign judgment does not contradict Algerian public order (ordre public). For export creditors, international arbitration with a seat in Paris or Geneva is a frequently used and enforceable alternative to Algerian litigation.