Cross-Border Debt Collection: EU Legislation and Domestic Procedures in Italy and Germany
In cross-border debt collection creditors often can choose between different procedures. The choice should consider the circumstances of each single case, but also the still existing differences between the procedures.
One of the most important UE goals is bringing closer the legislation of the Member States. To simplify, speed up and reduce the costs of litigation in cross-border cases concerning debts arising from civil and commercial matters, in 2006 the European Order for Payment procedure (EOP) has been created. The application for a EOP based on Regulation 1896/2006 must be lodged to a Court that is competent on the basis of European or national law.
The EOP is an additional option for the creditor, who remains free to choose also a procedure provided for by national law.
Beyond the question which national Court have jurisdiction, a domestic payment injunction against a debtor domiciled in different EU Member State is recognized in this Member State without any special procedure being required and can be enforced when it has been declared enforceable.
The Italian domestic procedure comparable to the EOP is called “ricorso per decreto ingiuntivo”, the German procedure “Antrag auf Mahnbescheid”.
When deciding whether to apply for a German or an Italian payment injunction procedure, it is important to consider certain differences:
In Italy it is necessary to provide written evidence of the credit, meanwhile in Germany the requirements are similar to the EOP ones: a short description of the credit and its nature is sufficient.
The German procedure (like the EOP) can be turned down through simple opposition of the defendant. In the Italian procedure when the defendant submits the opposition an ordinary judicial proceeding starts without options to turn it down if both parties do not agree on closing the case.
Furthermore, it should be considered that in the Italian opposition procedure the debtor may not only reject the payment request of the creditor, but can introduce also his own counter claims. This can bring to a procedural situation, which is unintended and undesired by the creditor.
In a nutshell: if in a cross-border credit recovery the creditor has the choice between several procedures and jurisdictions, the decision which procedure is the most opportune must be taken carefully and considering all relevant aspects. It is not a mere question of differences between the duration of proceedings or legal expenses.