Analysis of Regulation (EU) No 655/2014
Deyan Dragiev[1]
The article purports to analyse Regulation (EU) No 655/2014 of the European Parliament and of the Council of 15 May 2014 establishing a European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters („Regulation 655/2014“) laying down the European account preservation procedure, in the light of other EU Regulations as well as the provisions of Bulgarian national legislation, namely the Bulgarian Civil Procedure Code (“CPC”) and the Private International Law Code (“PILC”).
Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, recast as Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (“Regulation 1215/2012”), also known as Regulation Brussels Ibis, provided specific rules on cross-border interim measure procedure within the EU. However, the regime of cross-border interim measure procedures regarding bank accounts did not have comprehensive regulation. Under Regulation 655/2014, there is a new and special procedure for imposing account preservation orders in cross-border matters.
Regulation 655/2014 has a more restricted scope as it covers only interim measures for bank account preservation. Moreover, it applies only when the court dealing with the application for the preservation order is located in one EU Member State and the bank account concerned by the order is maintained in another Member State. A cross-border case should also be considered to exist when the creditor is domiciled in one Member State and the court and the bank account to be preserved are located in another Member State. Regulation 655/2014 does not derogate the existing procedures for obtaining interim measures under national law or as per other EU Regulations.
The competent court is the court having jurisdiction to rule on the substance of the matter in accordance with the relevant rules of jurisdiction. However, if the creditor has already obtained a judgment or court settlement, the competent court to issue account preservation order is the court that issued the judgment or approved the court settlement. The article compares this rule with the specifics of Articles 35 and 42 of Regulation 1215/2015 and Article 25 of PILC and analyses the concept of real connecting link developed in the case law of the Court of Justice of the European Union whereby a court not having jurisdiction on the substance of the matter may issue interim measures provided there is a territorial link with the place of enforcement.
In order that account preservation order under Regulation 655/2014 be issued, the creditor should submit sufficient evidence to satisfy the court that there is an urgent need for a protective measure in the form of a preservation order because there is a real risk that, without such a measure, the subsequent enforcement of the creditor’s claim against the debtor will be impeded or made substantially more difficult. Where the creditor has not yet obtained a judgment, court settlement or authentic instrument requiring the debtor to pay the creditor’s claim, the creditor should also submit sufficient evidence to satisfy the court that he is likely to succeed on the substance of his claim against the debtor. The procedure is ex parte (unilateral) and based on documentary evidence unless the law of the seized court allows other evidence. The article compares the requirements of Regulation 655/2014 with the requirements of the interim measure procedure of Bulgarian CPC.
The account preservation order is directly enforceable. Unlike Regulation 1215/2015, which requires a declaration of enforceability of the judgment, Regulation 655/2014 provides that the account preservation order is subject to enforcement by the relevant national authority, which as per Bulgaria is the enforcement agent. The enforcement procedure is governed by national procedural law, i.e. the Bulgarian CPC. However, Regulation 655/2014 provides various remedies for protection of the interests of the creditor, the debtor, and third parties. These are compared and contrasted to analogous remedies under Bulgarian CPC.
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Link to the article in Bulgarian language: Презграничният запор върху банкови сметки в системата на МЧП на ЕС и българския граждански процес
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[1] Deyan Draguiev is attorney-at-law at international law firm CMS practicing in the areas of commercial law, litigation and private international law and has numerous publications in leading law journals in Bulgarian and English language in the said areas. Graduated in Bulgarian law from Sofia University “Saint Clement of Ohrid” and English law from Manchester University. Member of the Honourable Society of the Inner Temple (London, UK) and the Advisory Board on Publications of the International Council for Commercial Arbitration. The views expressed in this article belong entirely and exclusively to the author.