Actions that debtors can take to counter a European Account Preservation Order on their bank accounts
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A debtor bound by a cross-border debt to a creditor, whether or not the latter holds an enforcement order, may have their bank assets frozen by a special attachment order known as the European Account Preservation Order.
The debtor is:
- not informed of the application for an account preservation order;
- nor given the opportunity to be heard before the preservation order is issued.
The aim of the procedure is to make sure the debtor is temporarily unable to disburse any of the money in their bank accounts before a judge rules on the validity of the debt requiring payment.
The debtor may take action only after their assets have been frozen by the bank.
Who is concerned
Any person (be they a natural or legal person) who holds a cross-border civil or commercial debt against a debtor (a natural or a legal person) may apply for a European Account Preservation Order.
The creditor cannot make use of this type of attachment if the debt arises from:
- matrimonial or patrimonial regimes governing relationships comparable in effect to marriage (e.g. a civil partnership or a PACS);
- wills and testaments and inheritances (including maintenance obligations resulting from a death);
- social security debts;
- arbitration decisions.
In addition, creditors may not make use of this type of attachment if bankruptcy, business liquidation or debt agreement proceedings have already been initiated against the debtor.
The European Account Preservation Order procedure is applicable in all EU Member States (with the exception of Denmark). This means that:
- a creditor residing in Denmark cannot apply for an attachment on an account held in Luxembourg;
- a creditor residing in Luxembourg cannot apply for an attachment on an account held in Denmark.
Prerequisites
Domicile (residence)
The creditor may be resident in the same EU Member State as the debtor, but the debtor's account must be held in a different EU Member State (with the exception of Denmark) as:
- the State holding jurisdiction over the application; or
- the State in which the creditor lives or is headquartered.
Example: A creditor and a debtor both live in Luxembourg, but the debtor's account is in France.
Unattachable monies
Monies exempt from attachment under the law of the Member State where the bank account is located cannot be seized.
Preliminary steps
When the attachment application is filed, if the creditor does not know the details of the debtor's bank account, they may ask the judge with whom the application for the European Account Preservation Order was filed to obtain that information from the competent authority in the Member State in which the attachment is to be executed. The creditor must indicate the reasons why they believe that the debtor holds one or more accounts with a bank in a specific EU Member State.
This information request can also be filed before the decision has acquired force of res judicata. However, in that case, the creditor must provide the judge with sufficient evidence to convince them of the urgent need to obtain information about the debtor's bank accounts. The urgency may be due to the risk that the debt will be lost, and the danger of a significant deterioration in the creditor's financial situation.
It should be noted that the conditions governing the transfer of such information between the bank and the authority in charge of collecting this information vary from one Member State to another.
The debtor will only be informed of the procedure by their bank 30 days after the bank has forwarded the information to the authority seeking it, to ensure that the European Account Preservation Order can be effectively enforced.
How to proceed
Filing of actions by the debtor
In Luxembourg, the debtor must file their appeal with:
- the magistrate with jurisdiction in the territory, for any debt less than EUR 15,000;
- the competent District Court, for any debt exceeding EUR 15,000.
The debtor:
- may file an appeal at any time;
- must file their appeal using the "Application for a remedy" form (Annex VII) (see the section 'Forms / Online services').
Appeal to revoke a European Account Preservation Order
The debtor may file an appeal with the authority that issued the attachment order, requesting that the order be revoked, if:
- the creditor, or even the judge, failed to observe the proper procedure for obtaining the attachment;
- the debtor had not been provided with the following documents within 14 days of the attachment:
- the order;
- the declaration;
- the notification of the order;
- the documents attached to the notification of the order were not sent:
- in the language of the Member State in which the debtor is domiciled; or
- where the Member State in question has multiple official languages, in a language which the debtor understands;
- the amounts frozen by the attachment exceeding the amount specified in the order were not released by the creditor;
- the debt has been paid in full or in part by the debtor;
- the decision handed down by the judge rejected the application relating to the debt which the creditor sought to recover by means of the attachment order;
- the decision handed down by the judge, the court settlement or the authenticated instrument which the creditor sought to enforce by means of the order was set aside or overturned.
Limiting appeal against the enforcement of the Account Preservation Order
In some circumstances, the attachments are not applied correctly when the order is implemented, or they are so significant that the debtor is no longer able to satisfy their essential needs. If permitted by the law of the Member State, the debtor may then ask the court or the competent authority to limit the amounts attached.
Appeal against the decision
In Luxembourg, for any order handed down in the first instance, the creditor may appeal against the decision before:
- the District Court with jurisdiction for the territory, if the initial judgement was issued by a magistrate;
- the Court of Appeal, if the initial judgement was issued by a district court.
The debtor has 15 days, from the date of notification of the initial order, to file their appeal. To do so, they must use the "Appeal against a decision on a remedy" form (Annex IX) (see the section 'Forms / Online services').
Appeal against the enforcement of the Account Preservation Order
The debtor can ask the court in the executing Member State to halt the enforcement of the order, if:
- the account on which the attachment is being made is immune from a European Account Preservation Order (see the section 'Who is concerned');
- the executing Member State has refused to enforce the decision, court settlement or authenticated instrument that the creditor sought to enforce with the attachment order;
- the enforceability of the decision that the creditor sought to enforce with the order has been suspended in the originating Member State;
- one of the cases justifying the use of the appeal to revoke the European Account Preservation Order has been cited (see 'Appeal to revoke a European Account Preservation Order');
- the order is manifestly contrary to public order in the executing Member State.
Good to know
Service of the Account Preservation Order on the debtor
When the debtor:
- is domiciled in the same Member State as that in which the Account Preservation Order was issued: notification of the order is served by the judge or the creditor, depending on the law of the competent Member State;
- is domiciled in a different Member State to that in which the Account Preservation Order was issued: the attachment order procedure is forwarded by the judge or creditor to the competent authority for acknowledgement, transfer and notification of the order in the State in which the debtor is domiciled, which authority will take the necessary steps to ensure that the documents are notified in accordance with the law of that Member State.
In Luxembourg, the attachment order is notified to the debtor by a bailiff.
When the European Account Preservation Order applies to multiple banks, only the first declaration stating that an attachment has been obtained for the amounts will be served on the debtor by the judge or creditor.
Any subsequent declaration indicating that other monies have been attached is brought immediately to the debtor's attention.
Freezing of accounts
Immediately upon receiving a copy of the order from the judge, the bank will freeze the debtor's account(s) up to the amount of the debt being claimed.
Online services and forms
Who to contact
Europäisches Mahngericht Deutschland (district and dunning courts in Germany)
-
Europäisches Mahngericht Deutschland
- Address:
-
Berlin
Germany
13343 Berlin
Related procedures and links
Procedures
Links
Legal references
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Règlement (UE) n°655/2014 du Parlement européen et du Conseil du 15 mai 2014
portant création d’une procédure d’ordonnance européenne de saisie conservatoire des comptes bancaires, destinée à faciliter le recouvrement transfrontière de créances en matière civile et commerciale
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Règlement d’exécution (UE) 2016/1823 de la Commission du 10 octobre 2016
établissant les formulaires mentionnés dans le règlement (UE) n° 655/2014 du Parlement européen et du Conseil
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Règlement (UE) n°1215/2012 du Parlement européen et du Conseil du 12 décembre 2012
concernant la compétence judiciaire, la reconnaissance et l’exécution des décisions en matière civile et commerciale
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Loi du 17 mai 2017
relative à la mise en application du Règlement (UE) N° 655/2014 du Parlement européen
- Nouveau Code de Procédure Civile
