I am a South African that worked in the UK for a number of years and racked up a LARGE amount of unsecured debt, I then moved back to SA approx 3 years ago. For the first year I paid my installments with GREAT difficulty - had to borrow money for food etc... I then got sick, used up all my sick leave, went back to work for half-days only and got paid for half-days only. Therefore I was unable to continue paying, I informed my main creditor of this fact, they handed me over to a debt collector, I communicated with them for a while but was unable to offer any repayments at that time. They have now handed me over to an "international credit" company in the UK. This company is trying to negotiate a settlement amount with me, very reasonable offer but I just don't have the money. A UK lawyer explained that usually bank loan contracts in the UK say that they are "subject to the laws of England and Wales". This means that it's possible for them to sue a person that is living in an EU member country (via reciprocal agreement) but he was unable to tell me if a South African court would reject the case because of the "subject to laws of England and Wales" clause or not. Any idea about this?

yes they can institute an action in SA. Or they can proceed out of the UK court and serve suoomns against you here in SA.