Summary

EUROPEAN ENFORCEMENT ORDER. Timely enforcement of judgments in civil and commercial matters in the European Union from the perspective of several international instruments.

A creditor has certain rights that are created by substantive law. For instance, the creditor is entitled to claim payment by the debtor. If the debtor refuses payment, the creditor can enforce his rights by initiating proceedings against the debtor in a court of law. If a judgment is rendered in favour of the creditor's claim, the creditor can en-force this judgment. In case of enforcement of a judgment in another State than the State where the judgment has been given, the question of recognition of the judgment arises before being enforced.

In Chapter 1 an overview is given of all aspects of cross-border enforcement. It is pointed out that the term 'enforcement' (in Dutch: 'tenuitvoerlegging') is an 'umbrella term' for all phases after the rendering of the judgment. Enforcement relates to all proceedings after the judgment is rendered, i.e. the service of the judgment on the debtor, the appointment of an enforcement agent (such as the 'huissier de justice', the ‘Gerichtsvollzieher' or the 'deurwaarder') and the execution of the judgment.

There are several instruments, which aim to simplify cross-border enforcement of judgments in civil and commercial matters. Among these the most important are the Brussels Convention, the Lugano Convention and the Brussels I Regulation. According to these instruments judgments given in a Member State have to be recognised in another Member State without any special procedure being required. These instruments set out an enforcement procedure for a judgment given by a court of a Member State. In this procedure a judgment is declared enforceable in the State of enforcement. In accordance with Articles 27 and 28 of the Brussels and the Lugano Conventions the declaration of enforceability - the exequatur - can be refused if the judgment does not fulfil the requirements for recognition. For instance, if the recognition of the judgment is contrary to public policy of the Member State of enforcement, the exequatur can be refused under Article 27(1) of the Brussels Convention. According to the Brussels I Regulation the exequatur can only be refused if the application for the exequatur does not fulfil the requirements of Articles 53 and 54 of the Regulation (formal check of documents). The party against whom the enforcement is sought, can lodge an appeal against the enforcement order in accordance with the Regulation. In addition, according to the Brussels and Lugano Conventions an appeal can be lodged against the granting of exequatur as well as the refusal of the exequatur. The possibility of lodging an appeal creates a possibility for mala fide debtors to obstruct the enforcement of a judgment rendered against them. Therefore, the idea of simplifying the exequatur procedure has been introduced in the European Union, so that there would be no need anymore for an exequatur procedure in the Member State of enforcement. The declaration of enforceability should not be given in the State of enforcement but in the State of origin of the judgment, where the lat-ter judgment should be certified. Such a certified judgment could be enforced in other Member States according to the principles of mutual recognition of judgments and of mutual trust in the administration of justice in the Member States of the European Union. This simplification of enforcement is a necessary step towards further integration of the interml market.

Simplification of the enforcement procedures can be realised in many ways. First, it can be accomplished by simplifying the exequatur procedure in the State of enforcement. The Brussels I Regulation gives an example of this simplification.1 This Regulation is dealt with in Chapters 3 and 4. The second possibility of simplification of enforcement is to abolish the intermediate procedure in the State of enforcement by a certification procedure in the State of origin of the judgment, which is to be enforced in another Member State. The certification procedure replaces the exequatur procedure in the State of enforcement. Under the Regulation on the European Enforcement Order a judgment can be certified in the State of origin as a European Enforcement Order.2 This judgment can be enforced in another Member State, with the exception of Denmark3, without a need for any declaration of enforceability and without any possibility of opposing its recognition. The Regulation on the European Enforcement Order is dealt with in Chapter 5. The third way of simplification the enforcement of judgments is by introducing a full faith and credit clause4, accompanied by a harmonisation of the procedural laws of the Member States. This clause would guarantee that, for instance, a judgment from a court in Bratislava would be enforced in Amsterdam in the same way as a judgment from a court in Rotterdam. An initiative for partial harmonisation of the procedural laws of the Member States can be found in the Proposal for a Regulation of the European Parliament and of the Council creating a European order for payment.5 This proposal is discussed in Chapter 6.

In its Communication to the Council and the European Parliament, the European Commission stated that the courts in the Member States are not only courts according to their national law but also according to the European Community law. By applying European law these courts become also European Community courts.

Hence, in the opinion of the European Commission there should no differences in the enforcement of judgments rendered by the courts of the different Member States. Judgments given in other Member States should enjoy the same status as the judgments given in the State of enforcement.6

In Chapter 2 the European Recognition and Enforcement Conventions and Regulations are discussed. The Brussels Convention has been concluded as an implementation of Article 220 of the EC Treaty (Article 293 EC).7 This Convention gives rules on the international jurisdiction of the courts of the Contracting States in civil and commercial matters and facilitates the recognition of the judgments of the courts of the Contracting States by introducing a simplified procedure for the enforcement of these judgments. The Lugano Convention has been concluded between the EC Member States and the Member States of the European Free Trade Association.8 It also sets out rules of international jurisdiction and rules of recognition and enforcement of judgments given in civil and commercial matters. However, it does not prejudice the application of the Brussels Convention between the Member States.

After its entry into force on 1 May 1999, the Treaty of Amsterdam made it possible to replace the Brussels Convention by the Brussels I Regulation. This Regulation supersedes the Convention between the Member States, with the exception of Den-mark. The scope of the Regulation remained the same as the scope of the Brussels Convention. The Regulation is applicable in civil and commercial matters. Some minor changes in the rules of international jurisdiction have been made. The procedure for enforcement in another Member State of a judgment rendered in a Member State has become more efficient and rapid. The exequatur is given automatically after a formal check of documents.

In order to create an area of freedom, security and justice the EC Service Regulation9 and the Brussels IIA Regulation10 have also been adopted. These Regulations are also discussed in Chapter 2.11

The Brussels IIA Regulation gives rules on international jurisdiction, recognition and enforcement of judgments in matrimonial matters and matters of parental responsibility for children.12 According to this Regulation a judgment of a court of a Member State is automatically recognised in another Member State. If a judgment is to be enforced, the Brussels IIA Regulation sets out a simplified procedure for enforcement.13 The enforcement of a judgment given in a court of another Member State can only be refused on limited grounds. The judgments on rights of access to a child and judgments on the return of a child which are certifled according to this Regulation in the Member State of origin have to be recognised and enforced in all Member States without any further procedure being required. Arrangements for the enforcement of such judgments remain governed by the national law of the State of enforcement. The certificate issued to facilitate enforcement of the judgment is not subject to any appeal. It can only be rectifled in the State of origin in case of a material error, i.e. where the certificate does not correctly reflect the judgment. The certiflcadon procedure abolishes the exequatur procedure necessary for making a foreign judgment enforceable in another Member State.

The EC Service Regulation sets out the roles for service of judicial and extra judicial documents in civil or commercial matters in the European Union. Contrary to other international service instruments under the EC Service Regulation cross-border service of a document is effected in the receiving Member State, whereas under the 1965 Hague Service Convention cross-border service is effected in the originating State. For the purposes of the service of documents the Regulation introduces a cooperation system between the transmitting and receiving agencies. According to the Regulation the Member States remain free to effect the service of documents by their consular or diplomatic agents as well as service by post to persons residing in another Member State. In the Jatter case any Member State may specify the conditions under which it will accept service of judicial documents by post. This Regulation shall not interfere with the freedom of any person interested in legal proceedings to effect service of judicial documents directly through the judicial officers, officials or other competent persons of the Member State addressed.

Chapter 3 deals with the recognition in one Member State of a judgment delivered by a court in another Member State. According to the Brussels I Regulation a judgment of a court of a Member State is to be recognised automatically in another Member State.

The term 'judgment' of the Brussels I Regulation and of the Brussels Convention does not cover freezing or attachment orders. These orders are mostly given in an ex parte procedure. According to the case law of the European Court of Justice a judgment cannot be recognised and enforced under the provisions of the Brussels Convention, if it has not been, or has not been capable of being, in the State of origin, the subject of an inquiry in contested proceedings.14 The attachment of a debtor's assets in the European Union could be possible if an instrument on the European Attachment Order would be adopted. Such a European Attachment Order would be recognised in all Member States of the European Union. By recognition of this order assets of the debtor would be garnished.15 In my opinion, the recognition of attachment orders would strengthen the principle of mutual trust in the administration of justice of the Member States of the European Union. Harmonisation of the procedural laws of the Member States remains prerequisite for adopting an instrument concerning a European Attachment Order.

According to the Brussels I Regulation the defendant can appeal against the declaration of enforceability, if there are grounds for non-recognition of the judgment. The court requested to declare a judgment enforceable cannot review the judgment or examine these grounds on its own motion.

The European Commission proposed to delete public policy as a ground for nonrecognition.16 According to the Brussels I Regulation the granting of exequatur can still be refused or revoked, if the recognition of a judgment is manifestly contrary to public policy. It is to be pointed out that any party interested can lodge an appeal against the exequatur. If no action is taken against the declaration of enforceability, the judgment is to be recognised and enforced. The limited possibility of refusing the recognition to a judgment given in a court of a Member State is one of the results of further integration within the European Union. The next step will be adjustment of procedural laws of the Member States. If procedural laws of the Member States we-re harmonised, civil procedures in all Member State would be the same. Given differences in procedural laws of the Member States, the complete abolition of grounds for non-recognition is not yet possible. These grounds can be abolished after a harmonisation of the different legal systems.

Under the Brussels I Regulation the intermediate procedure for enforcement relief in the Member State of enforcement has not yet been abolished. However, the procedure has been simplified. The declaration of enforceability of a foreign judgment in another Member State is issued automatically after a formal check of the documents, which are required by Articles 53 and 54 of the Regulation. There is no possibility for a court in this procedure to raise on its own motion any ground for nonrecognition. The party against whom the enforcement is sought can lodge an appeal against the declaration of enforceability. If the declaration of enforcement is refused, the party interested can lodge an appeal.

Another possibility of simplifying the enforcement of judgments in the European Union is the abolition of the exequatur procedure. The check of a judgment in the exequatur procedure can be transferred from the Member State of enforcement to the Member State of origin of the judgment. According to this system the enforcement of judgments in the European Union would be more rapid.

Chapter 5 deals with the Regulation creating a European Enforcement Order for uncontested claims. The Regulation enters into force on 21 January 2005. It will apply from 21 October 2005, with the exception of Articles 30, 31 and 31 which apply from 21 January 2005.17 According to this Regulation certain judgments can be certified as a European Enforcement Order in the Member State of origin. A certified judgment shall be recognised in other Member States without the need for a declaration of enforceability and without any possibility of opposing its recognition. In this system the possibilities of delaying the enforcement are restricted. The intermediate procedure for the declaration of enforceability in the Member State of enforcement is abolished. According to Article 22 of the Regulation an appeal can only be lodged in the Member State of enforcement against the enforcement of a certified foreign judgment, if the judgment is irreconcilable with an earlier judgment given in any Member State or in a third country.

According to the Council programme of measures for implementation of the principle of mutual recognition of decisions in civil and commercial matters, the system of Regulation on the European Enforcement Order is a step towards the complete abolition of the intermediate procedure for enforceability.18 In order to ensure full respect of the right to a fair trial the Regulation on the European Enforcement Order takes into account the fundamental rights with regard to civil procedure, especially the principle of fair trial. According to Article 6(1) of the Regulation the judgment that is to be certified, has to be delivered on an uncontested claim. This implies that the debtor knows that legal proceedings are pending in a court against him. However, if the document instituting the proceedings is served on a debtor in a way which does not ensure receipt of the document by the debtor, it cannot be said that he has been able to defend himself had he wished to do so. If a default judgment is rendered after the debtor has not entered an appearance, it is still delivered on an uncontested claim. This judgment can only be certified as a European Enforcement Order if the document instituting the proceedings or an equivalent document is served on the debtor in accordance with the minimum standards of Articles 13 and 14 of the Regulation on the European Enforcement Order. The debtor has to be also informed about the claim (Article 16) and about the procedural steps necessary to contest the claim (Article 17). In addition, the debtor has to be informed about the possibilities of reviewing of the judgment, which is certified as a European Enforcement Order (Article 19). If a judgment is certified due to a material error or if the certification has been wrongly granted, Article 10 of the Regulation states that the European Enforcement Order certificate can be rectified or withdrawn by the court of the Member State of origin upon an application.

The Regulation on the European Enforcement Order accomplishes a rapid system of enforcement of certain judgments in the European Union. In my opinion, it produces a balanced system. On the one hand, the abolition of the exequatur procedure makes the enforcement of a judgment swifter. On the other hand, a fair trial is guaranteed by the check of service of the document instituting the proceedings. The Regulation is a pilot-project according to the above-mentioned Council programme.19 The system of the Regulation is to be incorporated into the Brussels I Regulation. Hereafter, all judgments in civil and commercial matters shall be certified as a European Enforcement Order. To give more adequate guarantees in respect of the rights of the defence in my opinion the national laws of the Member States with re-gard to the service of documents in a civil procedure should be harmonised. Due to the present differences the smooth functioning of the system of the Regulation on the European Enforcement Order may be hindered.

In Chapter 6 an overview is given of the Proposal for a Regulation creating a European order for payment procedure.20 This proposal is a synthesis of the two models of order for payment procedures existing in the legai systems of the Member States.21 According to the proposed regulation the creditor has to present a brief description of at least one means of evidence that could be adduced in ordinary proceedings to support his claim. Whereas the debtor can object to the order of payment by submitting a statement of defence after being notified of the order of payment procedure or by lodging a statement of opposition to the order of payment. The statement of evidence can be produced in a response form that is attached to the notification of the order of payment procedure. If this statement is lodged, the proceedings will continue in accordance with the roles of ordinary civil procedure, unless the creditor requests to terminate the proceedings. By providing the possibility of lodging the statement of defence or the statement of opposition the principle of fair trial is fully respected.

The proposed Regulation on the European payment order procedure is a next step in developing and maintaining an area of freedom, security and justice. By means of the introduced procedure an uncontested debt, can be swiftly recovered. The proposed Regulation does not affect the application of the existing European instruments in the field of enforcement of judgments and in the field of service of documents. The issues, which are not dealt with in the Regulation, remain governed by the national law of the Member State where it is applied for a European payment order.

Neither the proposed Regulation on the European payment order procedure nor the Regulation on the European Enforcement Order interferes with the Brussels I Regulation and the EC Service Regulation. If these instruments would be affected by the specific rules with regard to the jurisdiction or to the service of documents in the Regulation on the European Enforcement Order or in the proposed Regulation on the European payment order procedure, the smooth functioning of the European instruments would be hampered.

Strengthening of the application of the principle of mutual trust in the administration of justice in the Member States and further simplification of the recognition and enforcement of the judgments in the European Union can be realised by the extension of the scope of the Regulation on a European Enforcement Order to all judgments.22 In my opinion this is not possible without partial harmonisation of the procedural laws of the Member States. An example of a harmonisation is the proposal for the Regulation on a European payment order. So far, the attempts of harmonisation of procedural law have been without any success.23 In general only substantive law has been subject to a harmonisation of the laws of the Member States. Given the differences in the systems of the procedural laws of the Member States rights created by substantive law cannot be enforced in each Member State in the same manner. It is to be noted out that there is a link between substantive law and procedural law. Procedural law enforces rights given in substantive law. By simplifying procedures concerning the recognition and enforcement of judgments an area of freedom, security and justice, in which the free movement of persons is ensured, is maintained and developed. However, to create this area a degree of harmonisation should be considered. If the procedural laws of the Member States are harmonised, the rights created by substantive law can be enforced in each Member State in the same manner. The European Union has set itself the objective to develop and maintain an area of freedom, security and justice. The measures in the field of judicial cooperation in civil matters as well as the measures for harmonising the procedural laws of Member States are necessary for the proper functioning of the interml market. In my opinion, harmonisation of procedural law can be realised by a European Code of Civil Procedure. If this Code applies in all Member States, there will be no need for an enforcement procedure or for a certification procedure. The procedural law would be the same in all Member States. This ambition may seem unrealistic. However, in order to establish the area of freedom, security and justice and for sound operation of the internal market of the European Union, the possibility of partial or step-by-step harmonisation of the procedural laws of the Member States is, in my opinion, still an option. Harmonisation should be focused on strengthening of the principle of the equality of arms in a civil procedure as well as of principle of fair trial.24 After the harmonisation of these specific subjects is realised, the 'over all' harmonisation of procedural laws can begin.