EU regulation makes it easier to take security measures against debtors

To date, in cross-border claims a creditor is confronted with an unknown enforcement procedure. He often has to pay high costs for obtaining security measures abroad. With the entry into force on 18 January 2017 of the EU-regulation No. 655/2014 (Regulation establishing an European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters) in all EU Member States except Great Britain and Denmark, the EU provides a new set of instruments to creditors in civil and commercial matters. It is intended to simplify the access to foreign bank accounts of the debtors by freezing their accounts. The claim must be filed at the court competent for the insolvency proceedings if no judgment or other enforceable title exists. If the applicant is a consumer, the claim can be filed at a court in his home country. Accounts of non-EU citizens and of Danish as well as English consumers cannot be blocked, even if the accounts are held in another EU Member State. If a judgment has already been delivered, the court which rendered the judgment is competent. The banks of the debtors must ensure that the blockages are properly implemented in order not to be liable. However, cross-border restructuring of companies can now be more difficult because they could be obstructed by a creditor blocking the accounts.