Act on Credit Servicing Activities and Credit Purchasers

Act on Credit Servicing Activities and Credit Purchasers 1)

Hereby is promulgated Act No. 1534 of 12 December 2023 on credit servicing activities and credit purchasers, with the amendments that follow from Section 9 of Act No. 1666 of 30 December 2024 and Section 12 of Act No. 712 of 20 June 2025.

Chapter 1 Scope and Definitions

Section 1. This Act applies to credit servicing activities and credit purchasers, subject to Sections 2 and 3.

Section 2. Section 15 applies to credit institutions intending to enter into a contract for the transfer of a creditor's rights or the transfer of a defaulted credit agreement, and credit institutions that have entered into such a contract with a credit purchaser.

Section 3. This Act does not apply to the following:

1. Credit servicing activities carried out by: a) credit institutions established in the European Union, b) alternative investment fund managers that, pursuant to Section 5 of the Act on Alternative Investment Fund Managers etc., must have permission or be registered, c) investment management companies with permission pursuant to Section 10 of the Act on Financial Business, or UCITS with permission pursuant to Section 9 of the Act on Investment Funds etc., provided that the UCITS has not appointed an investment management company, d) real estate credit companies subject to supervision under the Act on Real Estate Credit Companies, or consumer credit businesses subject to supervision under the Act on Consumer Credit Business, and e) notaries, bailiffs, and lawyers, when these carry out credit servicing activities as part of their profession.
2. The purchase of a creditor's rights under a defaulted credit agreement or of the defaulted credit agreement itself, carried out by a credit institution established in the European Union.
3. The purchase or credit servicing of a creditor's rights under a credit agreement or of the credit agreement itself, which has not been issued by a credit institution established in the European Union, unless the creditor's rights under the credit agreement or the credit agreement itself are replaced by a credit agreement issued by such a credit institution.

Section 2. In this Act, the following definitions apply:

1. Credit Institution: A credit institution as defined in Section 5, subsection 1, no. 2, of the Act on Financial Business.
2. Creditor: A credit institution that has issued a credit, or a credit purchaser.
3. Borrower: A legal or natural person who has entered into a credit agreement with a credit institution, including the credit institution's legal successor or rights holder.
4. Credit Agreement: An agreement, whether in its original issued form, amended form, or replaced form, whereby a credit institution provides credit in the form of payment deferral, loan, or other similar form of financial facility.
5. Credit Servicing Agreement: A written agreement entered into between a credit purchaser and a credit servicing company regarding the services that the credit servicing company shall provide on behalf of the credit purchaser.
6. Credit Purchaser: Any other natural or legal person than a credit institution that purchases a creditor's rights under a defaulted credit agreement or the defaulted credit agreement itself as part of its professional business activity.
7. Credit Service Provider: A third party used by a credit servicing company to carry out credit servicing activities.
8. Credit Servicing Company: A legal person that, as part of its professional business activity, manages and enforces rights and obligations related to a creditor's rights under a defaulted credit agreement or the defaulted credit agreement itself on behalf of a credit purchaser, and carries out one or more credit servicing activities.
9. Credit Servicing Activities: a) Collection or recovery of any amount owed from the borrower in connection with a creditor's rights under a credit agreement or the credit agreement itself. b) Renegotiation with the borrower in accordance with the terms and conditions attached to a creditor's rights under a credit agreement or the credit agreement itself, in accordance with the instructions given by the credit purchaser. c) Handling of any complaints in connection with a creditor's rights under a credit agreement or in connection with the credit agreement itself. d) Information to the borrower regarding any changes in interest rates, costs, or due payments in connection with a creditor's rights under a credit agreement or in connection with the credit agreement itself.
10. Home Member State: a) For a credit servicing company: The member state where the credit servicing company has its registered office, or, if it does not have a registered office under national law, the member state where its head office is located. b) For a credit purchaser: The member state where the credit purchaser or its representative is domiciled or has its registered office, or, if it does not have a registered office under national law, the member state where its head office is located.
11. Host Member State: Another member state than the home member state, where a credit servicing company has established a branch, or where it carries out credit servicing activities, and in any case, where the borrower is domiciled or has its registered office, or, if it does not have a registered office under national law, the member state where its head office is located.
12. Consumer: A natural person who, in connection with credit agreements covered by this Act, does not act as part of their professional business activity.
13. Defaulted Credit Agreement: A credit agreement classified as a defaulted exposure in accordance with Article 47a of the Regulation on prudential requirements for credit institutions and investment firms.

Chapter 2 Credit Servicing Companies

Permission for Credit Servicing Activities

Section 3. Companies carrying out credit servicing activities must have permission from the Danish Financial Supervisory Authority (Finanstilsynet) as a credit servicing company.

Section 2. The Danish Financial Supervisory Authority grants permission pursuant to subsection 1, provided that the following conditions are met, subject to Section 4, subsection 1:

1. The company is a legal person, and its registered office is located in Denmark, or, if the company does not have a registered office, its head office is located in Denmark.
2. The company's board of directors and management, or the owner, if the company is operated as a sole proprietorship, or the person(s) responsible for management, if the company is operated as a legal person without a board of directors or management, meet the requirements in Section 7.
3. The persons holding qualifying holdings in the credit servicing company, pursuant to Section 5, subsection 3, of the Act on Financial Business, meet the requirements in Section 7, subsection 1, nos. 3 and 4.
4. The company's board of directors or the person(s) responsible for management, if the company is operated as a legal person without a board of directors or management, meet the requirements in Section 7a.
5. The company has robust governance arrangements and appropriate internal control mechanisms, including procedures for risk management and accounting practices.
6. The company uses an appropriate policy to ensure compliance with protection rules and to ensure that borrowers are treated fairly and carefully, including taking into account their financial situation and the need for referral to debt advice or social services, if such are available.
7. The company has introduced appropriate and specific internal procedures to ensure that complaints from borrowers are registered and handled.

Section 4. To obtain permission, a credit servicing company that intends to receive and hold funds from borrowers must, in addition to the requirements in Section 3, meet the following requirements:

1. The company has a separate account at a credit institution where the funds received from borrowers are credited and held until they are channeled on to the relevant credit purchaser on the terms agreed with the credit purchaser.
2. The company ensures that the funds are protected against claims from the credit servicing company's other creditors, particularly in the event of insolvency.
3. The company considers a payment to have been made to the credit purchaser when a borrower makes a payment to a credit servicing company to fully or partially repay the amounts owed in connection with a creditor's rights under a defaulted credit agreement or the defaulted credit agreement itself.
4. The company issues a receipt or a release letter on paper or other durable medium when the credit servicing company receives funds from the borrower, as confirmation of having received the funds.

Section 2. If a credit servicing company does not intend to receive and hold funds from borrowers as part of its business model, the credit servicing company states this in its application, pursuant to Section 3.

Section 5. An application for permission pursuant to Sections 3 and 4 must contain the information necessary for the Danish Financial Supervisory Authority to assess whether the conditions in this chapter are met. The application must be accompanied by the following:

1. Documentation of the applicant's legal status as well as a copy of its founding document and the company's articles of association.
2. Address of the applicant's head office or registered office.
3. Identity of the members of the applicant's management body and the persons holding qualifying holdings, pursuant to Section 5, subsection 3, of the Act on Financial Business.
4. Documentation that the applicant meets the conditions in Section 3, subsection 2, no. 2.
5. Documentation that the persons holding qualifying holdings, pursuant to Section 5, subsection 3, of the Act on Financial Business, meet the conditions in this Act's Section 3, subsection 2, no. 3.
6. Documentation that the conditions in Section 3, subsection 2, no. 4, are met.
7. Documentation of the governance arrangements and internal control mechanisms mentioned in Section 3, subsection 2, no. 5.
8. Documentation of the policy mentioned in Section 3, subsection 2, no. 6.
9. Documentation of the internal procedures mentioned in Section 3, subsection 2, no. 7.
10. Documentation that a separate account at a credit institution exists, pursuant to Section 4, subsection 1, no. 1.
11. Any outsourcing agreements as mentioned in Section 10, subsection 1.

Section 2. The Danish Financial Supervisory Authority assesses within 45 working days from receipt of the application for permission whether the application is complete.

Section 3. The Danish Financial Supervisory Authority informs the applicant within 90 days from receipt of a complete application or, if the application for permission is considered incomplete, 90 days from receipt of the required information, whether the permission is granted or refused.

Section 6. The Danish Financial Supervisory Authority establishes and maintains a public register of all credit servicing companies that have permission pursuant to Sections 3 and 4, and credit servicing companies that provide services pursuant to Section 13.

Fit and Proper Requirements

Section 7. A member of the board of directors or management of a credit servicing company or the owner, if the company is operated as a sole proprietorship, or the person(s) responsible for management, if the company is operated as a legal person without a board of directors or management:

1. must have sufficient knowledge, professional competence, and experience to be able to perform the office or position,
2. must have a sufficiently good reputation and be able to demonstrate integrity, honesty, and sufficient independence in performing the office or position,
3. must not have been held criminally liable for violation of the Penal Code, financial legislation, or other relevant legislation, if the violation involves a risk that the person cannot perform their office or position in a satisfactory manner,
4. must not have filed a petition for or be under reconstruction proceedings, bankruptcy, or debt adjustment, and
5. must not have exhibited such behavior that there is reason to assume that the member will not perform the office or position in a proper manner.

Section 2. When a person assumes an office as a board member or a position as a director in a credit servicing company or enters as an owner, if the company is operated as a sole proprietorship, or as a person responsible for management, if the company is operated as a legal person without a board of directors or management, the Danish Financial Supervisory Authority ensures that the person meets the fit and proper requirements in subsection 1. The Danish Financial Supervisory Authority makes a decision on whether the person can hold the office or position in the relevant company.

Section 3. If the Danish Financial Supervisory Authority assesses that the person does not meet the requirements in subsection 1, nos. 2-5, the duration of the decision must be stated in the decision.

Section 4. The Danish Financial Supervisory Authority may, in special cases where the Danish Financial Supervisory Authority assesses that a person does not have sufficient professional prerequisites or experience relative to the position as a member of the management that the person is assessed for, make a decision that the person can hold the position under specifically determined conditions.

Section 5. Members of the board of directors or management of a credit servicing company or the owner, if the company is operated as a sole proprietorship, or the person(s) responsible for management, if the company is operated as a legal person without a board of directors or management, must inform the Danish Financial Supervisory Authority of matters mentioned in subsection 1 in connection with their entry into the credit servicing company's management and of matters mentioned in subsection 1, nos. 2-5, if the matters subsequently change. If a member of the board is appointed or elected to the position of chairman of the board in a credit servicing company, the board member must additionally inform the Danish Financial Supervisory Authority of matters covered by subsection 1, no. 1. The company's assessment of a chairman's personal competences covered by subsection 1, no. 1, must be in written form.

Section 6. The credit servicing company is obligated to ensure compliance with subsection 1.

Section 7a. The board of a credit servicing company must ensure that its members as a whole have the necessary knowledge and experience to operate the company in a competent and responsible manner. If the company is operated as a legal person without a board of directors or management, the first sentence applies correspondingly to the persons responsible for management.

Withdrawal of Permission for Credit Servicing Activities

Section 8. The Danish Financial Supervisory Authority may withdraw permission from a credit servicing company pursuant to Sections 3 and 4 if the credit servicing company does one of the following:

1. Does not use the permission within 12 months after it was granted.
2. Explicitly waives the permission.
3. Ceases to carry out credit servicing activities for more than 12 months.
4. Obtained the permission based on incorrect or misleading information or in another unlawful manner.
5. No longer meets the conditions in Section 3 and, where relevant, Section 4, subsection 1.
6. Grossly or repeatedly violates its obligations under this Act or other relevant legislation.

Section 2. If the Danish Financial Supervisory Authority withdraws permission pursuant to subsection 1, the Danish Financial Supervisory Authority immediately notifies the competent authorities in any host country or in the member state where the credit was granted, if this is not in Denmark or in the host country.

Requirements for Credit Servicing Agreements

Section 9. A credit servicing company that carries out credit servicing activities for a credit purchaser must deliver its services regarding the management and enforcement of a creditor's rights under a defaulted credit agreement or the defaulted credit agreement itself based on a credit servicing agreement with the credit purchaser.

Section 2. The credit servicing agreement mentioned in subsection 1 must contain the following:

1. A detailed description of the credit servicing activities that the credit servicing company shall carry out.
2. The size of the credit servicing company's remuneration, or how this remuneration shall be calculated.
3. A clarification of the extent to which the credit servicing company can represent the credit purchaser in relation to the borrower.
4. An undertaking from the parties to comply with the relevant rules applicable to a creditor's rights under a credit agreement or the credit agreement itself, including regarding consumer and data protection.
5. A clause requiring that borrowers are treated in a fair and careful manner.
6. A requirement that the credit servicing company notifies the credit purchaser in advance of outsourcing any of the credit servicing company's credit servicing activities.

Section 3. The credit servicing company must keep and maintain the following records for at least 5 years from the date the credit servicing agreement is terminated, or until the expiration of the maximum limitation period under the Limitation Act, in both cases however at most 10 years:

1. Relevant correspondence with both the credit purchaser and the borrower on the terms set out in applicable national law.
2. Relevant instructions from the credit purchaser regarding a creditor's rights under each defaulted credit agreement or the defaulted credit agreement itself, which it manages and enforces on behalf of this credit purchaser.
3. The credit servicing agreement.

Section 4. The credit servicing company must make the records mentioned in subsection 3 available to the Danish Financial Supervisory Authority upon request.

Outsourcing by Credit Servicing Companies

Section 10. A credit servicing company may outsource credit servicing activities to a credit service provider when the following conditions are met:

1. A written outsourcing agreement is entered into between the credit servicing company and the credit service provider. It must appear from the agreement that the credit service provider is obligated to comply with the applicable legal provisions, including this Act and the relevant EU law or national law applicable to a creditor's rights under a credit agreement or the credit agreement itself.
2. Outsourcing to a credit service provider does not involve all credit servicing activities at the same time.
3. The contractual relationship between the credit servicing company and the credit purchaser and the credit servicing company's obligations towards the credit purchaser or towards the borrower are not changed by an outsourcing agreement with the credit service provider.
4. The conditions that the credit servicing company must meet to be granted and maintain permission, pursuant to Section 3, subsection 1, continue to be met.
5. The credit servicing company has direct access to all relevant information regarding the credit servicing activities outsourced to the credit service provider.
6. The credit servicing company has the necessary expertise and resources to deliver the outsourced credit servicing activities when the outsourcing agreement has ended.
7. The outsourcing of credit servicing activities does not impair the quality of the credit servicing company's internal control, solvency, or continuity of its credit servicing activities or the Danish Financial Supervisory Authority's ability to monitor whether the credit servicing company meets the conditions in this Act.

Section 2. A credit servicing company that outsources credit servicing activities to a credit service provider is fully responsible for compliance with the provisions of this Act.

Section 3. A credit servicing company that outsources credit servicing activities to a credit service provider must notify the Danish Financial Supervisory Authority in advance of outsourcing its credit servicing activities.

Section 4. A credit servicing company that outsources credit servicing activities to a credit service provider must keep and maintain records of relevant instructions to the credit service provider in accordance with the conditions in the outsourcing agreement for a period of at least 5 years from the date the outsourcing agreement is terminated, or until the expiration of the maximum limitation period under the Limitation Act, in both cases however at most 10 years.

Section 5. The credit servicing company and the credit service provider must make the information mentioned in subsection 4 available to the Danish Financial Supervisory Authority upon request.

Section 6. The credit service provider must not receive and hold funds from borrowers.

Complaints

Section 11. Credit servicing companies must introduce and maintain effective and transparent procedures for handling complaints from borrowers.

Section 2. Credit servicing companies' handling of complaints from borrowers must be free of charge.

Section 3. Credit servicing companies must register the complaints and the measures taken to handle them.

Chapter 3 Cross-Border Credit Servicing Activities

Cross-Border Credit Servicing Activities in Another Country

Section 12. A credit servicing company that has obtained permission in accordance with Sections 3 or 4 in this country and wishes to deliver services in the form of credit servicing activities in another country in the European Union must notify the Danish Financial Supervisory Authority and inform the Danish Financial Supervisory Authority of the following:

1. Which host country the credit servicing company wishes to deliver services in, and, if the credit servicing company already knows the information, the member state where a credit was granted, if it was not granted in Denmark or in the host country.
2. The address of the branch of the credit servicing company, if such has been established in the host country.
3. The identity and address of the credit service provider, if such is used in the host country.
4. The identity of the persons responsible for managing the credit servicing activities in the host country.
5. The measures taken to adapt the credit servicing company's internal procedures, governance arrangements, and internal control mechanisms with a view to ensuring compliance with the legislation applicable to a creditor's rights under a credit agreement or the credit agreement itself.
6. That the credit servicing company can communicate in the host country's language or in the language in which the credit agreement was drawn up.
7. Whether the credit servicing company has permission to receive and hold funds from borrowers.

Section 2. The Danish Financial Supervisory Authority communicates the information mentioned in subsection 1 to the competent authorities in the host country no later than 45 working days after receipt of all the information. The Danish Financial Supervisory Authority then informs the credit servicing company of the date on which the information was communicated to the competent authorities in the host country and the date on which they confirmed receipt of the information. The Danish Financial Supervisory Authority also communicates all information to the competent authorities in the member state where the credit was granted, if it was not granted in Denmark or in the host country.

Section 3. The credit servicing company may begin delivering services in the host country from the earliest of the following times:

1. Receipt of information from the Danish Financial Supervisory Authority that the competent authorities in the host country have confirmed that the notification mentioned in subsection 2, second sentence, has been received.

2. 2 months from the date of submission of the information mentioned in subsection 1, if

3. The Act contains provisions implementing Directive (EU) 2021/2167 of the European Parliament and of the Council of 24 November 2021 on credit servicing activities and credit purchasers and amending Directives 2008/48/EC and 2014/17/EU, Official Journal of the European Union 2021, No. L 438, page 1. Act Gazette A 2025 Published on 3 December 2025 18 November 2025. No. 1439. Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, Case No. 25-002431 CQ003378