European Payment Order – introductory information
The European Payment Order is a form of a court order allowing for the execution of claims from a foreign trading partner from within the European Union (except for Denmark, which has not implemented the EU procedure).
Only uncontested monetary claims in civil and commercial matters can be claimed under the proceedings for the issuance of the European Payment Order.
The proceedings for issuance of the European Payment Order are used in cross-border disputes (with a cross-border element), i.e. where at least one party’s place of residence or registered office is in a Member State other than the Member State where the court hearing the case is situated. The nationality of the parties is irrelevant. This means that the European Payment Order procedure is not applicable where both the creditor and the debtor reside or have their registered offices in the same Member State.
The main objective of this procedure is to decrease the costs of judicial proceedings in cross-border cases, to facilitate and shorten them. The client is given the verdict automatically since the court adjudicates any amount indicated in the legal action filed, as long as all the formal requirements of the claim are met.
In case where the debtor’s place of residence or registered office is in Poland or this is where the contract was being performed, or this is where the unlawful act to the person’s detriment was committed, and in other cases specified in the Regulation of the Council of the EU No. 44/2001 from the 22 December 2000 – the applicable jurisdiction to file a legal claim for the issuance of the European Payment Order will be that of a Polish court.
The payment order issued to the client can be directed straight to the debt collector in an EU Member State, thereby circumventing the time-consuming and complicated court procedures (eg. with regard to recognition of the legal orders), which normally need to be conducted additionally in courts of the country of the debtor’s residence or registered office.
Considering the costs of solving such matter abroad, and in some countries – the unreasonable length of the procedure (eg. Poland), conducting the proceedings on the basis of the European Payment Order is much cheaper and faster. Taking into account achieving an equivalent result as in the cases of court orders issued by courts in the debtor’s country, the proceedings under the European Payment Order are often practised and used in disputes against unreliable trading partners.