An Innovation: The European order for payment procedure

In 2006 the European Parliament established a new order for payment procedure for the European Union with Regulation 1896/2006.

The procedure simplifies, speeds up and reduces the costs of litigation in cross border cases concerning uncontested pecuniary claims in civil and commercial matters. All member states of the European Union except Denmark recognize the procedure. The payment can be more easily enforced in these member states and no further declaration of enforceability is needed. The Regulation is binding and came into effect on the 12th of December, 2008.

The basic idea of the new procedure is to set up a simplified system for collecting uncontested debts (i.e. claims where there is no dispute over whether the money is owed or not, but where the debtor is unwilling or unable to pay) between member states. The Regulation lays down a standard order to be issued at the request of the creditor by the court having jurisdiction. Which court has jurisdiction is dictated by Regulation 44/2001.The court issues a payment notification which informs the defendant about the claim and gives the defendant debtor an opportunity to lodge a statement of defense. If the defendant debtor lodges a statement of defense, the order for payment procedure is automatically brought to an end and the matter is transferred to ordinary civil court proceedings. If he does not act, the court delivers the order of payment to the defendant debtor, requesting payment. The order becomes enforceable and no further exequatur (a legal document that makes the sentence executable in the member state) is necessary.

At Art of Contracts we can help you start an order for payment procedure. If you need further information, do not hesitate to contact us. We will try our best to be of service.