European (EU) Payment Order

The European Payment Order (Regulation (EC) No 1896/2006) is modelled after the German Payment Order. Just like its German idol the European Payment Order makes use of standard forms and leads to a fully enforcable title in as little as a month without any of the parties ever having to attend a court session in persona.

The importance of the European Order for Payment lies in the fact that it brought about a quick and efficient procedure to recover debts possessing a Union dimension. That is it has to be a cross border case (EU wide). Both parties must reside within the EU, but not within the same Member State. The Regulation has therefor stopped short of bringing an easy collection procedure to those Member States of the European Union, that don't have such a procedure for purely internal cases. The Dutch, for example, cannot utililze the European Payment Order against another resident in the Netherlands and the Dutch do not have such a procedure as the German Payment Order in their national legal system.

The European Order for Payment can be seen as a natural result of the European Union's approach to push integration ever deeper and ever wider in an ever greater number of fields. However, leaving political implications aside for the time being one can also observe truly practical perspectives of the European Payment Order. Where creditors were deterred from recovering a debt abroad due to language difficulties and the fact that they would have to leave the shelter of the jurisdiction they trust, there is now one set of forms, one European Payment Order, available at all courts throughtout the Union, which allows for the swift recovery of almost all monetary debts - if creditor and debtor happen to reside in different Member States.

The European Payment Order has not replaced the, if existing, national Payment Orders however. Potential applicants are thus spoiled with choice, should the debtor reside in a Member State that holds a national default judgement procedure, a Payment Order system, as well. Such can be the case if the creditor resides in any given Member State and the debtor happens to have his domicile in Germany, for example. Against such a debtor a German as well as an European Payment Order could be filed for.

Please note that MMrecht has specialized in the application of the German Payment Order, for which reason we will exclusively process your claims via the German Payment Order.

For practical purposes it suffices to realize that the European Payment Order is, just like the German Payment Order, completely standardized via paper or e-forms. The details that have to be provided on the forms only differ marginally from those that have to be given on the German forms. Legal representation is not mandatory, but certainly recommened, as well.

The forms of the European Payment Order have to be submitted to the court of the debtor's place of residence, or to a central court designated to deal with European Payment Orders centrally for the entire country. For Germany the Amtsgericht Berlin Wedding has been given such exclusive competence. The Judicial Atlas of the European Union informs about the competent court for the various states and cities in the European Union.

The debtor is given 30 days to object to the claim. If an objection is done - also via standardized forms by the way, the process turns into an ordinary civil procedure before a competent court, just like the German Payment Order. However, unlike the German order, the debtor is only given one chance to object not two, namely the period of 30 days mentioned above.

Once the 30 days have run, the title is turned into an enforcable title automatically. This title can then be enforced in every Member State of the European Union without any further ado. The enforcement is then regulated by the law of the country of execution.

Please feel free to have a read through our translation of Mr. Muller's commentary in the Dutch Lawyer's Journal on the European Payment Order from a Dutch perspective to get more substantiated information about the European Payment Order. Additionally, have a read through this article, if you'd like to know more about the application of the European Enforcement Order from a German point of view.