The european order for payment procedure

The tardiness of debtors is a well known and frequent problem for business players. Naturally this problem increases in times of crises. An instrument which is not used very often to enforce a debt is the European order payment procedure. When clients consult a lawyer they often believe that if a debtor moved into a foreign country and didn’t leave any asset in Spain there is no possibility to assert the claim. On these grounds they write off their receivables. But there is always a possibility to enforce the debts. It exists a especially easy method if the debtor lives in another country of the European Union.

The european order for payment procedure is legally regulated since 2006. The European regulation 1896/2006 of the counsel and the European Parliament is released in the Official Journal Nr. L 399  dated 30.12.2006. As usual in european procedural law this is a communication system between juridical authorities and parties based on a mutual confidence of the member states of the European Union. Part of this basis of trust is the belief that all courts of justice of the European Union’s member states are credible and that the systems of public communication particularly post are credible as well.

Furthermore laws like this always want to simplify the communication between the administration of justice and the party of the proceedings in the different cultures, tongues and countries. This would be done with publishing officially translated forms in the official journal of the European Union. Because of this further costs and interpretation issues could be avoided.

It should not be forgotten that this European law is directly applicable and there’s no need to transfer it into common law.

In any case this is a possible procedure to the creditor of recovering receivables. However the creditor is free to use the old fashioned way as well, if he prefers it. The european order for payment procedure pretends to be significantly easier and quicker and it avoids any procedure leading to a judgment as well as an allowance of existing deeds between the different countries.

The creditor only has to present the official form to the competent court of the originating country which has to fulfil different requirements and will be sent by the court without further analysis to the debtor to his new residence. The court only checks the compliance with the formalities.

If the court doesn’t accept the form there is the possibility to appeal against this decision at the same level of jurisdiction in accordance with the national law. If the court releases the default summons the debtors has two possibilities, either he fulfils the requirement or he oposes. If he does neither of them the court of the originating country releases an executory title which accepted in every country of the European Union.

Carlos Prieto Cid, Lawyer

This article in German