Counterparty Monitoring in Ukraine: How to Catch Debts, Court Cases and Seizures
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You checked your counterparty in January: no red flags, no outstanding debts, no litigation. The contract was signed, and the first deliveries went smoothly. It seemed the issue was settled.
But in March, the counterparty quietly changes its director. In April, a court judgment is issued against the company. In May, enforcement proceedings are opened. You know nothing about any of this because your due diligence ended on the very day the contract was signed.
Then a major shipment is prepaid, while the company you are dealing with is no longer the same company you originally reviewed.
The biggest problem in this situation is not the risk itself, but the fact that you learn about it only after the fact rather than in advance: when an overdue payment turns into litigation, and litigation turns into an uncollectible debt. An initial due diligence review, no matter how thorough, only reflects a single point in time. It tells you nothing about what may happen to the counterparty three months later.
What should you do?
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A counterparty may look reliable when the contract is signed and become a serious risk months later. Registry monitoring can flag litigation, debts, asset seizures, or management changes before the next payment or delivery.
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en court cases may pose less risk than one major enforcement proceeding. What matters is the counterparty’s role, amounts involved, case status, asset seizures, and whether the disputes could affect performance of your deal.
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