Can you get paid if your U.S. customer files for bankruptcy?
As an exporter, you take on a certain amount of risk when you ship goods outside of Canada prior to receiving payment. In fact, until the money comes in, you're at the mercy of your customer.
The U.S. economy has seen a jump in the number of companies that have filed for bankruptcy protection (Chapter 11) over the past few years. If you export to a U.S. business, be aware of your options should the owner file for bankruptcy prior to paying you.
In his article "What to do if your U.S. customer runs for bankruptcy cover," Denis L'Heureux, Regional Vice-President, Export Development Canada, offers his advice on how to handle this dicey situation. He explains that there are actions you can take to help minimize your losses, should these circumstances arise, such as filing a Proof of Claims with the bankruptcy court.
If you're looking for more information on exporting goods or services from Canada, check out our Exporting section.