Tuesday 10 May 2011

Proposed interim measures for the freezing and disclosure of debtors' assets in cross-border cases

P7_TA(2011)0193

European Parliament resolution of 10 May 2011 with recommendations to the Commission on proposed interim measures for the freezing and disclosure of debtors' assets in cross-border cases (2009/2169(INI))

2012/C 377 E/01

The European Parliament,

having regard to Article 225 of the Treaty on the Functioning of the European Union,

having regard to its resolution of 25 October 2007 on the Green Paper on improving the efficiency of the enforcement of judgments in the European Union: the attachment of bank accounts (1) ,

having regard to its resolution of 22 April 2009 on the effective enforcement of judgments in the European Union: the transparency of debtors' assets (2) ,

having regard to its resolution of 25 November 2009 on the Communication from the Commission to the European Parliament and the Council – An area of freedom, security and justice serving the citizen – Stockholm programme (3) ,

having regard to the Stockholm Programme for 2010-2014 – An open and secure Europe serving and protecting its citizens (4) , adopted by the European Council on 10 December 2009 (5) , and in particular point 3.4.2 thereof,

having regard to Rules 42 and 48 of its Rules of Procedure,

having regard to the report of the Committee on Legal Affairs and the opinion of the Committee on Economic and Monetary Affairs (A7-0147/2011),

whereas the Union's most important tool in promoting growth in the aftermath of the financial crisis is its internal market; whereas it is essential that the millions of businesses and citizens who make use of the internal market and of the right to live, work and travel throughout the EU have effective remedies in the event that they have a claim against another citizen or business,

whereas the internal market and the area of freedom, security and justice become a reality for citizens and businesses only where Union law, in particular in the area of civil justice, is effectively applied, from transposition and awareness-raising to application and enforcement,

whereas the current level of successful cross-border debt recovery is remarkably low, as regards both the assets of natural persons and those of undertakings; whereas this state of affairs discourages cross-border trade, sends a message of impunity to recalcitrant debtors and hinders the Union's economic performance,

whereas the cost of cross-border debt recovery is currently prohibitive for creditors in cases where a debtor has assets in several Member States; whereas the time has come to simplify and speed up this recovery process,

whereas such prohibitive costs have a negative impact on the extension of cross-border loans and even cross-border commercial transactions, representing a major barrier for the full functioning of the internal market,

whereas cross-border enforcement must be a priority in the internal market and courts must be able to act swiftly to order the freezing of the debtor's or alleged debtor's assets; whereas in the absence of such a facility rogue traders and others who deliberately seek to evade their responsibilities can move their assets to another jurisdiction, forcing citizens and small businesses who have already secured a court judgment to go before another Member State's courts in an effort to recover assets,

whereas an order for the disclosure of information about assets is required, given the practical difficulties creditors face in accessing information on debtors from public or private sources in a cross-border context,

whereas the legislative action requested in this resolution should be based on detailed impact assessments, as requested by Parliament,

whereas detailed information on the procedures for enforcing claims in every Member State should be available through the European e-Justice portal; whereas cooperation between enforcement authorities in the Member States should be stepped up in order to speed up debt recovery,

whereas the instruments proposed should complement existing Union law and initiatives, in particular Directive 2011/7/EU of the European Parliament and of the Council of 16 February 2011 on combating late payment in commercial transactions (6) , Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (7) , Regulation (EC) No 1896/2006 of the European Parliament and of the Council of 12 December 2006 creating a European order for payment procedure (8) , Regulation (EC) No 861/2007 of the European Parliament and of the Council of 11 July 2007 establishing a European Small Claims Procedure (9) , and the European e-Justice portal,

whereas the instruments should be simple and should avoid delay and unnecessary expense; whereas they must be available where appropriate ex parte, with ‘surprise effect’; whereas debtors' and alleged debtors' rights should be correspondingly safeguarded in order to avoid any misuse of the measures requested,

Requests the Commission swiftly to submit to Parliament, on the basis of Article 81(2) of the Treaty on the Functioning of the European Union, legislative proposals on measures for the freezing and disclosure of debtors' and alleged debtors' assets in cross-border cases, following the detailed recommendations below;

Confirms that the recommendations respect the principle of subsidiarity and the fundamental rights of citizens;

Considers that the requested proposal does not have financial implications for the Union budget;

Instructs its President to forward this resolution and the accompanying detailed recommendations to the Commission and the Council.

(1) OJ C 263 E, 16.10.2008, p. 655.

(2) OJ C 184 E, 8.7.2010, p. 7.

(3) OJ C 285 E, 21.10.2010, p. 12.

(4) OJ C 115, 4.5.2010, p. 1.

(5) European Council Conclusions – 10-11 December 2009 – EUCO 6/09.

(6) OJ L 48, 23.2.2011, p. 1.

(7) OJ L 12, 16.1.2001, p. 1.

(8) OJ L 399, 30.12.2006, p. 1.

(9) OJ L 199, 31.7.2007, p. 1.

Tuesday 10 May 2011

ANNEX

DETAILED RECOMMENDATIONS AS TO THE CONTENT OF THE PROPOSAL REQUESTED

Recommendation 1 (on the form and nature of the instruments to be adopted)

The European Parliament requests the following instruments: a European order for the preservation of assets (EOPA) and a European order for the disclosure of assets (EODA). The form of Union action should be that of a regulation. Both instruments should be free-standing remedies additional to those available under national law. They should apply only in cross-border cases.

Recommendation 2 (on jurisdiction to issue such an order)

The European Parliament considers that the requested instruments should contain uniform jurisdictional rules specifying which national courts are competent to issue them. Those uniform rules should take into account the fact that the court having substantive jurisdiction under Council Regulation (EC) No 44/2001 (1) is generally best placed to deal with such orders. They should also take into account the stage reached in the main proceedings in the course of which the order is requested.

Recommendation 3 (on jurisdiction to hear oppositions to the orders)

The European Parliament considers that the court which has initiated the EOPA or EODA should have exclusive jurisdiction to hear oppositions to it where such oppositions are to the EU-wide effect of an order. Where the opposition is to the effect of an order in a specific Member State other than the one of the initiating court, this rule could be tempered, in order to protect debtors, alleged debtors and third parties, by also conferring jurisdiction on the courts of the Member State in which the assets are located. The grounds for opposition to the orders should be listed exhaustively in the instruments requested.

Recommendation 4 (on the standard form for requesting the orders and on reporting)

The European Parliament considers that both orders should be requestable via a standard multilingual form, including through the European e-Justice portal. The form should be as simple as possible. Communication should also be standardised in connection with the execution of the orders (e.g. in the case of the EOPA: the response of the bank to the enforcement authority as to the success of the attachment, the notification of the debtor, etc.).

Recommendation 5 (on reporting)

The Commission should be under an obligation to report on the implementation of the requested instruments and, in particular, on their uptake.

Recommendation 6 (on the stage of the main proceedings at which such an order may be sought)

The European Parliament is of the opinion that it is essential to be able to obtain an EOPA ex parte, that is, without initial notice being served on the party whose assets are concerned. The order should be available before, during, and after the main proceedings.

Recommendation 7 (on the case to be made out by the creditor)

The European Parliament considers that the granting of an EOPA by a national court should be discretionary. Furthermore, the burden of proof should be on the claimant to make a good prima facie case (fumus boni juris) and to establish urgency (periculum in mora). These criteria should be assessed by national courts on the basis of the existing case-law of the Court of Justice.

Recommendation 8 (on the minimum amount of information necessary to issue an EOPA)

The European Parliament is of the opinion that precise information concerning the debtor or alleged debtor, as opposed to actual bank account numbers, should be sufficient. Such information should be sufficient to prevent confusion in the case of homonymy.

Recommendation 9 (on the enforceability of such an order)

If the order has been obtained prior to a judgment establishing a debt, as is most often the case, it should be enforceable throughout the EU subject to minimal necessary intermediate measures. By contrast, if the order has been obtained after a judgment establishing a debt, then it should be enforceable throughout the EU without any intermediate measures being required.

Recommendation 10 (on the effect of such an order)

The European Parliament is of the opinion that the effect of the EOPA must be confined to the attachment of bank accounts and the temporary freezing of bank deposits, and should not grant the creditor any form of ownership of the assets. Further consideration should be given to the issue of whether the order could cover other types of assets, such as immovable property or future assets (a claim about to become payable or an inheritance).

The EOPA should affect no more bank accounts than necessary, and should be limited to the amount of the debt, plus any legal fees and interest. It should be possible for the initiating court to limit the order in time on a case-by-case basis, taking the merits of each case into account.

Recommendation 11 (on the processing of EOPAs)

The European Parliament would prefer the use of an electronic transmission system linking the issuing court with the bank holding the accounts, accessible via the European e-Justice portal, but remains open to all alternatives.

The European Parliament is of the opinion that the EOPA should impose on banks an obligation to give effect to the order immediately (i.e. within certain strictly defined time-limits) and a further obligation to inform the enforcement authority of the success or failure of any attachment. This processing should comply with applicable data protection rules.

The European Parliament urges the Commission to design the requested instrument in such a way as to minimise the cost of its use. Given the substantial differences in the cost of bank attachments between Member States, consideration should be given to the issue of whether the requested instrument should aim to harmonise such costs, or whether it should leave a decision on their level to Member States. In any event, such costs should not exceed a maximum set in the regulation, should be transparent and non-discriminatory, should reflect the actual costs incurred and should take into account the establishment of the Single Euro Payments Area and the fact that such procedures should be standardised as much as possible.

The European Parliament calls for detailed consideration to be given to the issue of who should bear the cost of processing an EOPA, including an examination of best practices at national and regional level.

Recommendation 12 (on procedural safeguards for debtors and alleged debtors)

The European Parliament considers that the requested instrument should include a comprehensive set of safeguards for debtors and alleged debtors:

A. When requested prior to a judgment establishing a debt, the granting of an EOPA should be conditional on the claimant providing security or other guarantees at the discretion of the initiating court, in order to compensate the defendant and any third parties for any damage suffered. The defendant should be able to terminate the EOPA by providing security. Member States should ensure that these provisions do not constitute a barrier to access for those with limited financial means.

B. If an EOPA is granted without notice (ex parte), the defendant should be notified formally and given all information required to prepare an opposition to the order without delay after execution.

C. The defendant should have a right to submit an ex post opposition to an EOPA. Grounds for such an opposition should be harmonised in the requested instrument. Jurisdiction to hear such an opposition should also be harmonised in the instrument.

D. A clear time frame should be set for the EOPA. In particular, if main proceedings have not yet been brought, a time-limit for so doing should be set by the issuing court.

E. The instrument should take due account of the diversity of practices at domestic level concerning debtor hardship, including existing thresholds below which the bank account of a natural person cannot be attached. Such matters should therefore be left to the law of the debtor's or alleged debtor's Member State of habitual residence. However, to increase legal certainty for creditors, Member States should be under an obligation to communicate to the Commission information on the existence of such exemptions, which would be made public.

F. The EOPA should stipulate that the creditor enforces an EOPA at his own risk and may be liable to compensate the debtor for any damage suffered as a result of the enforcement measures.

Recommendation 13 (on the nature of such an order)

The European Parliament considers that it should be possible to seek the order at least following a judgment establishing a debt. The Commission should consider whether the order should be available at an earlier stage in the proceedings, for instance when the court having jurisdiction on the substance considers that there is a real risk that its judgment would not be satisfied, and what corresponding safeguards should be put in place.

The European Parliament further considers that each Member State should be required to decide which authority or authorities are competent to initiate an EODA. Such designated authorities would be able to issue EODAs on a case-by-case basis, taking into account the circumstances of each case.

Recommendation 14 (on the material scope of such an order)

The European Parliament considers that debtors should as a general rule be required to disclose all assets located within the area of freedom, security and justice, in order to give the creditor the widest possible choice of action.

Recommendation 15 (on the enforceability of such an order)

The European Parliament considers that only the court or authority which has initiated the EODA should be able to modify it or set it aside. Such an order should be enforceable throughout the EU without any intermediate measures being required.

Recommendation 16 (on procedural safeguards for debtors and alleged debtors)

The European Parliament considers that the requested instrument should include a comprehensive set of safeguards for debtors:

A. The instrument should strike an appropriate balance between the right to the protection of personal data, as guaranteed by Directive 95/46/EC and as enshrined in the Charter of Fundamental Rights of the European Union, and the effective enforcement of judgments. In particular, safeguards should be put in place to protect the information disclosed as a result of an EODA and to prevent its misuse.

B. The EODA should stipulate that the creditor enforces it at his own risk and may be liable to compensate the debtor for any damage suffered as a result of the disclosure.

C. Full payment of the debt must lead to the EODA being immediately set aside, including upon a unilateral application by the debtor providing proof that the debt has been settled.

Recommendation 17 (on penalties for incorrect statements in the declaration)

The European Parliament considers that the requested instrument should set out a framework of penalties for non-compliance or false statements, in order to achieve effective and uniform compliance with the order throughout the area of freedom, security and justice.

(1) Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (OJ L 12, 16.1.2001, p. 1).