New tool to help SMEs and citizens recover unpaid credits

The Legal Affairs Committee of the European Parliament today adopted a first reading agreement on the Regulation establishing an order of conservative seizure of the bank accounts of debtors in cross-border cases. "There are about a million small businesses struggling with problems related to cross-border credits", said Raffaele Baldassarre MEP, Rapporteur on the proposal for the European Parliament. "To solve this problem, the new tool will allow the creditor to apply for a conservative seizure, effective across Europe, which will block the bank accounts of the debtor, regardless of where they are located."

The Regulation aims at solving a number of structural deficiencies with respect to cross-border credits recuperation, introducing a uniform procedure for obtaining a conservative seizure under the same conditions in all the participating Member States automatically recognised among them. At the same time, the tool allows a considerable cost reduction for the creditor, including legal fees and translation.

Baldassarre continued: "The effectiveness of the seizure order is guaranteed by the surprise effect which will mean the absence of prior notifications to the debtor. The new tool will allow businesses to redeem €600m in loans which they would normally give up, discouraged by the idea of embarking on expensive and unclear legal proceedings in foreign countries."

The proposal aims at facilitating the recovery of cross-border claims for citizens and businesses (in particular SMEs), to improve the enforcement of judgments in civil and commercial matters concerning cross-border disputes, but also reducing the risks of cross-border trade, increasing the confidence of cross-border traders and thus improving the internal market.