Scope of the European order for payment: who can use it and for what claims?

Collecting cross-border debts is often a tricky business. The European Union has created a powerful tool for creditors: theEuropean order for payment. Regulation (EC) No 1896/2006 of 12 December 2006 establishes this simplified procedure, but its use requires a precise understanding of its scope.

The material domain: civil and commercial only

The European order for payment applies exclusively to civil and commercial matters. To find out more which court will have jurisdiction for your cross-border dispute, it is essential to master the specific rules of international and national jurisdiction. The text expressly excludes:

• Tax matters
• Customs matters
• Administrative matters
• State liability for acts of public authority

According to Article 2 of the Regulation, the following are also excluded:

• Matrimonial property regimes
• Wills and inheritance
• Social security
• Bankruptcy and similar proceedings

It is notable that, unlike other European instruments, the regulation does not explicitly mention the exclusion of arbitration. This omission has given rise to differing interpretations. The French circular of 26 May 2009 considers that " there is no provision excluding arbitration from the scope of the Regulation" .

Eligible types of debt

Monetary claims

Only pecuniary claims may be the subject of a European order for payment. Article 4 of the Regulation stipulates that they must be:

• Liquids (valued in silver)
• Due on the date of application

Uncontested claims

The "uncontested" nature of the claim is an essential element. The Court of Justice of the EU clarified this concept in the Pebros Servizi Srl v Aston Martin Lagonda Ltd judgment of 16 June 2016. The conditions must be "autonomously determined" according to the regulation.

Mainly contractual

Settlement generally excludes non-contractual claims, unless:

• They have been agreed between the parties
• There has been an acknowledgement of debt
• They relate to liquid debts arising from the joint ownership of an asset

Unlimited claims

Unlike certain national order for payment procedures (such as in Belgium, where a ceiling of €1,860 applies), the European procedure imposes no ceiling on the amount claimed.

Territorial scope

Definition of cross-border disputes

The European order for payment applies only to cross-border disputes. Article 3 of the Regulation defines these as disputes "in which at least one of the parties is domiciled or habitually resident in a Member State other than the Member State of the court seised".

This cross-border nature is assessed at the time the application is submitted.

Member States concerned

The regulation applies in all EU Member States except Denmark. Denmark benefits from a derogation under Protocol 22 annexed to the TEU and the TFEU.

The United Kingdom and Ireland chose to take part in the adoption of the regulation, despite their opt-out arrangements.

Specific features of French territory

In France, the regulation applies in mainland France and Mayotte (an outermost region), but not in other overseas collectivities such as the French overseas departments and territories:

• French Polynesia
• Wallis and Futuna Islands
• Saint Pierre and Miquelon
• Saint-Barthélemy
• New Caledonia

How to determine the eligibility of your claim

To use this procedure, your situation must meet a number of conditions:

1. Check that the case is cross-border: you must be suing a debtor domiciled in a Member State other than that of the court you are suing.
2. Make sure that your claim is civil or commercial and does not fall within the exclusions mentioned.
3. Check that your claim is:
   • Financial
   • Liquid and due
   • Mainly contractual in origin (with some exceptions)

Once these conditions have been met, you can refer to the page detailing the practicalities and forms to submit your request.

In complex situations, such as when the claim arises partly from non-contractual obligations or when its "undisputed" nature seems questionable, legal advice is essential, as is a knowledge of the legal rules. remedies and protection of the defendant.

Remember that this procedure is optional. You can always use national recovery procedures or other European instruments such as the Brussels I bis Regulation or the European Enforcement Order.

Need help with your cross-border debt collection procedure? Our firm analyses the admissibility of your application free of charge and suggests the strategy best suited to your situation.

Sources

• Regulation (EC) No 1896/2006 of the European Parliament and of the Council of 12 December 2006 creating a European order for payment procedure, Articles 1 to 6
• DACS Circular C3 06-09 of 26 May 2009 on the application of Regulation (EC) No 1896/2006
• CJEU, 3rd Ch. 16 June 2016, Pebros Servizi Srl v Aston Martin Lagonda Ltd, Case C-511/14
• CJEU, 1st Ch. 14 June 2012, Banco Español de Crédito SA v Joaquín Calderón Camino, Case C-618/10
• Protocol No 22 annexed to the Treaty on European Union and to the Treaty on the Functioning of the European Union