The Attachment of Bank Accounts in Cross-Border Cases According to the European Regulation 655/2014

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The new European Regulation 655/2014 which establishes a European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters came into force on 18 January 2017. The Regulation applies to monetary claims in civil and commercial cross-border cases.

The importance of the Regulation 655/2014 is that it introduces a new possibility for creditors with cross-border claims to attach the bank accounts of their debtors situated in another EU Member State by means of a European Account Preservation Order. Furthermore, the Regulation allows creditors to obtain information regarding a debtor's bank account.

The European Account Preservation
Order can be requested in all stages of a dispute, i.e. either before the start of the proceedings on the merits of the case, during these proceedings or after the issuance of a judicial decision. The European Account Preservation Order issued by the court of a Member State is recognized without any special procedure and it is enforceable without needing a declaration of its enforceability.

In order to issue a European Account Preservation Order, the creditor must submit sufficient evidence to demonstrate that there is an urgent need for judicial protection, claiming that there is a real risk that the subsequent enforcement of creditor’s claim will be made impossible or substantially more difficult without the measure. It must be noted that the refusal of the debtor to pay the claim is in itself not sufficient to justify the issuance of an European Account Preservation Order. In case that the creditor applies for the European Account Preservation Order before the issuance of a judgement on the merits of the case, the creditor must prove before the court that he is likely to succeed in the proceedings on the merits of the case.

If the creditor has sufficient evidence or grounds to prove that the debtor holds a bank account in a certain Member State, but does not have any further information to identify the account, he may submit a request for obtaining information to the relevant court. This possibility is only available for creditors who have already obtained a judgement or an authentic instrument. The time frame of the issuance of a European Account Preservation Order is short and amounts to 5-10 working days.

The European Account Preservation Order procedure takes place ex parte and the debtor is not be notified of the application or heard prior to the issuing of the order. In order to ensure the rights of the debtor in this ex parte procedure, the creditor will be required in cases where the judgement has not yet been obtained, to provide a security sufficient to compensate possible future damages of the debtor caused by the European Account Preservation Order. The debtor may further apply for a modification or revocation of the European Account Preservation Order claiming that there was a change of circumstances, on basis of which the European Account Preservation Order was issued. Also, the debtor may apply for modification or revocation of the European Account Preservation Order on a number of grounds listed in the Regulation.

Dafni Siopi is an Attorney at Law, LLM

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.

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