New EU rules came into force on 18 January to make it easier to recover cross-border debts, explains the European Commission in a press release. The new rules should speed up and lead to less costly recovery procedures for debts contracted in other member states, which should make life easier for companies, particularly small- and medium-sized companies (SMEs).
The Commission explains that some €600 million is lost each year due to cumbersome and costly legal procedures that prevent companies from recovering money due to them in other countries. The planned European account preservation order (EAPO) can help companies by providing them with a simple and profitable way of blocking the money due to them.
At present, a company wishing to recover a debt from a commercial partner in another EU member state simply requests the freezing of said amount by a court in the business partner’s country, under local rules and procedures.
The new procedure gives courts a maximum of ten days to issue an EAPO and debtors would not be informed in advance of such an order. This is to ensure that money is not removed from the account or wasted, but remains available for repaying the debt. An EAPO issued in one member state will be recognised in all other member states and standard application forms will be available. (Original version in French by Solenn Paulic)