LEGAL & REGULATORY MATTERS
WHEN CUSTOMERS DON’T PAY THEIR BILLS By Andrés Fígoli
A
fter the capacity service is finally delivered to customers and the service is working well, a carrier may have to deal with certain customers who fail to pay the carrier’s invoices. There are a variety of scenarios behind this attitude, such as bankruptcy filings, delays in processing payment orders, or even emails sent directly to spam folders in customers’ mailboxes. And there is a special group of challenging debtors: customers who had no intention of paying their debts in the first place and have strategically positioned their pawns accordingly. Here are some tips for dealing with
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these special and time-consuming customers.
CLEAR CONTRACT TERMS
These difficult debtors know that a key factor in any collection process is negotiating a good service agreement that solves the common multi-jurisdictional problem where the customer’s location and assets are different from the cable owner’s location, and the governing law may not even match the courts or arbitration venue. Therefore, if the customer insists on local law and courts, it is advisable to consult with local counsel in that jurisdiction to avoid surprises later. This includes
situations where the local legal process may be excessively slow or even opaque, with a suspiciously consistent tendency to favor local companies in case law. Other suspicious requests during contract negotiations may include: • Low interest rates on past due invoices. • Cure periods of more than 30 days to correct a breach of contract. • Refusal to pay reasonable upfront fees in an IRU. • The right to terminate without cause during the initial term of the contract and only in favor of the customer. None of these individual instances