European Enforcement Proceedings Procedure
Regulation No. 1896/2006 of the European Parliament and of the Commission on the European Execution Procedure without Execution, published in the Official Gazette on 30.12.2006, entered into force on 31.12.2006. On 12.12.2008, it became binding for the member states. The purpose of the adoption of the European Regulation on Extrajudicial Execution Procedure is to facilitate the adjudication and enforcement of transnational, non-contentious money claims.
Application Area and Procedure of the European Nonjudicial Enforcement Procedure
As stated in Article 2 of this Regulation, the TFEU is applicable only in civil and commercial transboundary matters. However, the type of jurisdiction is not important here. That is, it does not matter whether it is a general court or a labour court.
Extraterritorial jurisdiction exists when at least one of the parties has its domicile or habitual residence in a Member State other than the one in which the court of jurisdiction is located (Art. 3, I TEC). The domicile or habitual residence is determined in accordance with Article 3, II of the TEC pursuant to Articles 59 and 60 of the Council of the European Union Regulation on the Competence of Courts in Civil and Commercial Matters and on the Recognition and Enforcement of Judgments of Courts. The ECtHR does not apply to purely national legal questions
For transboundary civil and commercial matters, many exceptions are provided for the non-applicability of the OJTT (Art. 2, II). These are matters relating to matrimonial property regime, inheritance law, bankruptcy and insolvency liquidation, social security law. Of the remaining legal matters, in principle only claims arising from contractual debt relations are covered by the Regulation. For claims arising out of non-contractual debt relations, only if they are the subject of a contract or an acknowledgement of debt between the parties, or if they arise out of joint ownership of immovable property, the European procedure of execution without judgement is applicable.
A limitation is introduced by Article 4. Pursuant to this Article, the EIT may only be invoked for a claim that is definite in amount and due at the time of application.
Pursuant to Art. 6, I TEC, the international jurisdiction of the enforcement court is in principle determined by its provisions. Pursuant to the first paragraph of Article 2 of the aforementioned Regulation of the Council of the European Union on the Competence of Courts in Civil and Commercial Matters and on the Recognition and Enforcement of Judgments of Courts, the courts of a Member State are competent for proceedings against a person whose domicile is within the sovereign territory of a Member State, irrespective of his nationality.
However, the reference of Art. 3, I to Art. 5-24 may lead to the conclusion that another court is competent (e.g. the place of performance of a contract, the place of performance of a tort). If the claim arises out of a contract and the debtor of the contract is a consumer, then only the courts of the Member State in which the consumer is domiciled are deemed to have international jurisdiction (Art. 6, II TFEU). This provision serves to protect the consumer. The consumer cannot be forced to make a defence before the court of another Member State.
The substantive, local and functional jurisdiction of the enforcement court is not regulated in the OSCE. Therefore, these powers are determined according to the national law of the member states whose courts have international jurisdiction.
APPLICATION FORM AND PROCEDURE
The European summary execution procedure can only be initiated upon application. The application must be made in the form of Example-A (AXXEN-1), which is annexed to the European Code of Civil Enforcement (Art. 7, I TFEU). The application must be signed. There is no obligation to retain a lawyer in order to file an application (Art. 24 TEC). Pursuant to Art. 7, IV TEC, the creditor may declare to the court in its application that it refuses to transfer the execution without judgement to the general court in the event of the debtor’s objection. However, he may also make this declaration at a later stage, until the payment order is issued.
The mandatory elements of an application are set out in Article 7, II of the EIT.
Accordingly, the application must contain, inter alia, the following information
The amount of the claim (original claim, interest, contractual penalty and costs),
Information about the event on which the claim is based and the subject matter of the dispute,
What evidence is necessary to establish the existence of the claim. Evidence (e.g. promissory notes) need not be attached.
The creditor must also declare that he or she has disclosed the information to the best of his or her ability and that he or she accepts the sanctions provided for in the law of the Member State of origin for wilful misrepresentation (Art. 7, III of the ECT).
The OSCE does not stipulate that the application must be made in a particular language. Therefore, the language in which the application should be made will be determined according to the national laws of the Member State.
When applying for the issuance of a European payment order, court costs, which are determined according to the law of the Member State, must also be paid (Art. 15 of the General Grounds of the OSCE)
REVIEW OF THE APPLICATION
The court to which the application for enforcement without judgement is made examines whether the application falls within the regulatory scope of the EIT, whether it has jurisdiction and whether the formal requirements of Art. 7 EIT have been fulfilled (Art. 8 EIT). The court also examines whether the request appears to be justified (Art. 8, c. 1 TEC). This makes it possible for the court to examine whether the request is justified (Art. 16, c. 2, GDPR).
POSSIBLE DECISIONS OF THE COURT
Granting the Possibility of Correction
If the application does not fulfil all the formal and substantive requirements of Art. 7 TEC, Art. 9 TEC provides for a special rectification procedure. Accordingly, the enforcement court may not reject the application immediately. On the contrary, it shall give the creditor the opportunity to complete or correct the application within an appropriate period of time. The correction is also made by means of printed forms. For this purpose, the court uses Annex B (ANNEX-2) to the ECT.
Invitation to Amend the Application
If the application conditions are met only for part of the claim, the court shall notify the creditor. For this purpose, Sample-C (ANNEX-3) of the Annex to the EIT is used (Art. 10, I of the EIT). The enforcement court asks the creditor to accept or reject the partial amount indicated in the payment order. The creditor shall respond by returning the printed form to the court within the time limit set by the court. If the creditor accepts the court’s proposal, the court shall issue a European payment order based on the amount accepted by the creditor.
The fate of the remainder of the claim shall be determined in accordance with the law of the Member State. If, on the other hand, the creditor refuses or fails to honour the court’s invitation, the court shall reject the request for the issuance of a European payment order in its entirety (Art. 10, III TFEU). The creditor shall be informed of this legal consequence by means of an Exemplar-C sent to him (Art. 10, I, c. 2 TEC).
Rejection of the Application
If the conditions listed in Articles 2, 3, 4, 6 and 7 of the EIT (scope of application, international jurisdiction, form and content of the application) are not fulfilled at the time of the application, the court shall reject the request for the issuance of a European payment order (Art. 11, I, c. 1/a of the EIT). The rejection of the application will also result if the claim is manifestly unjustified or if the creditor fails to make the necessary correction within the prescribed time limit. The creditor shall be informed of the grounds for rejection by means of Annex IV, Example D (ANNEX-4).
There is no remedy against a decision to reject an application (Art. 11, II TFEU). However, if national law provides for a remedy of review within the same level of jurisdiction, this remedy may be available. For example, there is a remedy of review in the case of a refusal by the German Court. In German courts, the judgement is rendered by an Assistant Justice Officer. An appeal against the judgement can be lodged within 2 weeks pursuant to § 11, II of the Assisting Justice Officer Act. The Assistant Justice Officer may accept the objection; if not, he or she submits the case to the (first instance) judge for a decision. The judge decides on the objection definitively.
Issuance of a European Payment Order
As a result of the examination of the Application, as the case may be, after the Application has been completed, corrected or amended in accordance with Articles 9, 10 TFEU,
If Europe falls within the scope of the enforcement procedure without a judgement,
If the court has jurisdiction,
If the application fulfils the necessary requirements in terms of form and content,
If the claim does not appear to be manifestly unjustified,
The court issues a European payment order (Art. 12, I, c. 1 TFEU). The order for payment is issued as soon as possible and, as a rule, within 30 days of the filing of the application. This deadline does not include the time the creditor needs to correct or amend the application (Art. 12, I, c. 2 TEC). Sample-E (AXXEN-5) in the Annex to the EIT is used for the European payment order.
REMEDIES AVAILABLE TO THE DEBTOR
Objection against European Payment Order
The debtor may file an objection against the payment order before the court of origin pursuant to Article 16, I of the EIT. Objection must be lodged within a period of 30 days from the notification of the payment order. The time limit is also preserved if the objection is lodged within the time limit.
An objection duly lodged within the time limit automatically converts the enforcement procedure into a normal proceeding before the court of the Member State of origin. No special request is required for this. However, the domestic law of the country in which the competent court is located may provide for a different procedure.
Review in exceptional cases
This remedy is only permissible in three exceptional cases:
if the notification pursuant to Art. 14 TFEU was made without proof of receipt by the debtor, and the notification was not made through no fault of the debtor at a time when the debtor would have needed it in order to make his defence
If the debtor is unable to lodge an objection due to a force majeure event or extraordinary circumstances through no fault of his/her own,
The European payment order is manifestly unjustified in relation to the conditions laid down in the ECT or in other extraordinary circumstances (Art. 20, II ECT). These extraordinary circumstances include the fact that the European payment order is based on incorrect information in the application form.
There are two possibilities regarding the content of the decision on the request for control: If the conditions for a check, which are recognised as exceptional pursuant to Article 20, I, II TEC, are not present, the application is rejected. In this case, the European payment order remains valid (Art. 20, III, c. 1 TEC).
If, on the other hand, the court finds that the check is justified for the reasons listed in Article 20, I, II TEC, it shall declare the European payment order null and void (Art. 20, III, c. 2 TEC). Thus, the European execution without judgement procedure is terminated (Art. 1093, III EPC); otherwise, it does not become an adversarial proceeding.
ENFORCEMENT and RECOGNITION
If no objection is lodged within the time limit, the court shall, without delay, declare the European payment order enforceable by using Example-G in accordance with Annex VII (Art. 18, I TEC). In addition to the 30-day objection period, the court shall allow a further reasonable period of time deemed necessary for the submission of the objection before issuing an enforcement decision (Art. 18, I TEC). This is because the timely submission of the objection is sufficient to comply with the 30-day deadline. Thereafter, the decision on enforceability cannot be challenged.
The enforceable European payment order is sent to the creditor (Art. 18, III TEC). A European payment order declared enforceable in the Member State of origin may also be recognised and enforced in another Member State without a separate decision on enforceability pursuant to Article 19 TEC. The law of the Member States in which the enforcement is to take place shall apply to the enforcement procedure (Art. 21, I of the ECT).
If enforcement is sought in another Member State, the creditor shall submit to the competent enforcement authority a copy of the European payment order with enforcement annotation and, where necessary, a translation thereof into the official language of the Member State in which enforcement is sought (Article 21, II/a,b). Each Member State may regulate separately whether it accepts a translation in another official language in addition to its official language.
Pursuant to Article 22 of the OSCE, in certain circumstances, the competent court may refrain from enforcement at the request of the debtor. The refusal to enforce is primarily based on the existence of conflicting judgements, i.e. if the European payment order contradicts a previous court judgement or a previous payment order (Art. 22, I EIT). The conflicting judgment must fulfil the conditions for recognition in the Member State where enforcement is to be carried out. Furthermore, the contradiction must not yet have been raised before a court in the Member State of origin. Therefore, this requires that the debtor should have learnt of the existence of the conflicting judgement at the earliest after the expiry of the objection period.
Enforcement is also terminated when the debtor pays the creditor the amount contained in the European payment order (Art. 22, II TEC). On the other hand, the European payment order cannot be controlled in substance in the Member State where the enforcement is to take place (Art. 22, III TEC). The refusal of enforcement is recognised by an interim decision.
If the debtor requests control in the exceptional circumstances provided for in Article 20 TEC, the competent court may, at the request of the debtor in the Member State where the enforcement is to be carried out, limit the enforcement procedure to security measures (Art. 23/a TEC), condition it on the creditor providing security (Art. 23/b TEC) or, in exceptional circumstances, postpone the enforcement procedure (Art. 23/c TEC). The court shall issue an interim injunction in this respect.
Abbreviations
EECT: European Regulation on Enforcement without Execution
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