Regulation (EU) No 655/2014 on the European Account Preservation Order Procedure entered into force
On January 18th 2017, the EU RegulationNo 655/2014 of the European Parliament and of the Council of 15 May 2014 establishing a European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters (or the EU Regulation on the European Account Preservation Order) entered in the force
The regulation establishes a European Account Preservation Order procedure ("EAPO") establishes a new uniform European procedure for the preserving of bank accounts, which will allow creditors to preserve the amount owed in a debtor's bank account located in the EU. This order can be crucial in debt recovery proceedings because it would prevent debtors from removing or dissipating their assets during the time it takes to obtain and enforce a judgment on the merits.
It provides common rules relating to jurisdiction, conditions and procedure for issuing an order, how it should be enforced by national courts and authorities, the remedies for the debtor and other elements of defendant protection.
The EAPO procedure allows for a single order to be made in the courts of one Member State which would be capable of 'freezing' any bank account of a debtor in any Member State. It thus makes it less cumberso
me, lengthy and costly for a creditor to obtain provisional measures to preserve assets in bank accounts of their debtor located in another Member State. The EAPO is available to the creditor in cross-border cases, as an alternative to instruments existing under national law.
The new European order allows creditors to preserve funds in bank accounts under essentially the same conditions in all Member States. The EAPO would be issued in an ex parte procedure, that is, without the debtor's knowledge. This would have a “surprise effect” which is essential for the effectiveness of the order– if the debtor is warned that the creditor wants to freeze his accounts, chances are that the money will have gone elsewhere by the time the order is issued and implemented.
The creditor can apply for the EAPO prior to obtaining a judgment on the merits of the case or when he has already obtained a judgment, court settlement or authentic instrument requiring the debtor to pay the creditor's claim.
An important element of the Regulation which will make it easier for creditors to recover their claims is an access to information about bank accounts. If the creditor does not know with which bank the debtor holds an account in a certain Member State, he may use, under certain conditions, a special procedure for obtaining information about the account of the debtor.
To read the full text of the EU Regulation on the European Account Preservation Order, follow this link
If you want more information / advice on the EU Regulation on the European Account Preservation Order, please contact firstname.lastname@example.org.