European order for payment
Anna Zielińska from the Dispute Resolution and Arbitration practice group at Wardyński & Partners explains how to pursue undisputed monetary claims against foreign debtors.
Regulation (EC) No 1896/2006 of the European Parliament and of the Council of 12 December 2006 creating a European order for payment procedure has been in force for two years. The regulation introduced a simple, separate procedure for enforcing claims within the EU (comparable to the “summary proceeding” that was already in place in Poland). Under the European order for payment procedure, a creditor may enforce undisputed monetary claims for a specific amount that have fallen due as of the time the application for the order is filed. It should be borne in mind, however, that the regulation applies only to cross-border cases, i.e. where at least one of the parties is domiciled in a member state other than the member state whose court is considering the case. The regulation applies in civil and commercial cases, with certain exceptions.
The European order for payment procedure is a simplified procedure based on the use of standard forms by the parties as well as the court. Much as in a “simplified” proceeding in Poland, when seeking a European order for payment the plaintiff files a statement of claim using a standard application form (Form A, an annex to the regulation).
The application must indicate the parties, the court where the application is filed, the principal amount sought, interest, a justification for the claim, the evidence, and the facts supporting the jurisdiction of the court and the cross-border nature of the case. These requirements may seem complicated, but the form sets out these points in a format that is helpful to the litigant.
If the court finds any defects in the application, the court will give the plaintiff an opportunity to correct or supplement the application, unless the claim is clearly unjustified or impermissible.
If the court finds that there are no grounds to reject the application, it will issue the European order for payment—as a rule, within 30 days after filing.
The order for payment is served on the defendant, together with the application. The defendant then has 30 days to dispute the order by filing a statement of opposition with the court that issued the order. The opposition may simply state that the defendant disputes the claim, and need not specify the grounds for filing the opposition. If opposition is effectively filed, the case is then transferred to the court in the member state where the order was issued that would otherwise have jurisdiction over the case under general rules, unless the plaintiff expressly indicated that it prefers for the proceeding to be terminated if opposition is filed.
In exceptional circumstances, the defendant may seek review of the order even though the deadline for filing opposition has passed. This is possible where the order was served on the defendant without acknowledgement of receipt, or in a time that did not allow the defendant to prepare a defence, through no fault of its own, or the defendant was otherwise prevented from filing an opposition, e.g. because of force majeure, but the defendant must file the motion promptly. The defendant may also seek review when issuance of the order was clearly erroneous. If the court finds that review of the order for payment is justified, the order becomes null and void.
If timely opposition is not filed, the court will immediately declare the order enforceable (there is a form for this too).
A European order for payment shall be recognised and enforced in other member states without the need for any further declaration of enforceability, and without any possibility of opposing recognition. An order that has become enforceable in a member state shall be enforceable under the same conditions as other enforceable decisions in the member state where the order was issued. The creditor may thus commence execution against the debtor in any member state without undertaking additional actions.
The enforcement proceeding itself is subject to the law of the state of enforcement. This means, for example, that if a European order for payment is issued in France and is to be enforced in Poland, enforcement will be conducted under Polish law.
For enforcement in another member state, the claimant shall provide the competent enforcement authorities with a copy of the order, as declared enforceable by the court of origin, and where necessary, an official translation.
The regulation sets forth the circumstances under which a member state may refuse to enforce an order.
In order to enforce a European order for payment in Poland, as in most other cases in which a creditor obtains a writ of execution, it is necessary to obtain an enforcement clause. Under Polish Civil Procedure Code Art. 11535, an enforcement clause is issued by the district court with general jurisdiction over the debtor, or if that cannot be determined, the district court for the district where the execution is to be commenced.
The European order for payment procedure is quite new and it is hard to assess its effectiveness fully. Nonetheless, it does appear immensely useful, particularly at a time when there is a high level of international trade in goods. It not only creates simple, uniform rules for enforcing claims through the EU, but also eliminates intervening requirements for enforcing orders obtained under this procedure, which means that creditors may move more quickly to execution and satisfaction of their claims.