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European small claims procedure

Do you have a dispute with a European customer or company for which you want to go to court? If so, you may have to file proceedings abroad which can be quite costly and take a long time. In this blog you will read about one of the alternative possibilities: the 'European Small Claims Procedure'. After reading, you will know when you can invoke this procedure, what its main advantages and disadvantages are and how the procedure roughly works.

 

European dispute

If you regularly do business with a party based abroad and a legal problem arises, you can quickly find yourself in a maze of procedural rules. Among other things, these rules determine which court has jurisdiction to hear your case and what law it must apply. For example, a German judge may hear a case brought by a Dutchman against a Belgian for the transportation of a cargo from Antwerp to Berlin, and then have to apply Belgian law – as well as international transport law. Do you still follow...? The European Union must have thought the same thing: "Can't it be a little bit more simple?" The good news is that the answer to that question can sometimes be answered "yes”.

 

According to European law (Regulation 861/2007), in small disputes, there must be a possibility of easy settlement. The regulation deals exclusively with civil and commercial cases, say approximately those cases involving two non-governmental entities, i.e. a dispute between two companies or between a company and a customer. It must be a dispute in which the claim (without interest, etc.) does not exceed €5,000. Finally, it is required that it is a "cross-border case". That is, it must be a case where the parties are not resident/residing in the same member state. Denmark has stipulated an opt-out, meaning that you cannot invoke this procedure against a Dane/Danish company.

 

Procedure

If your case meets the aforementioned requirements, you can use the procedure. In principle, the procedure is in writing (which in most cases can also mean digitally). This can be an advantage because, for example, you do not have to travel abroad to give oral evidence during a trial. You can start the procedure by sending a form, with supporting documents as attachments, to the competent court. The disadvantage is that the form must be drawn up in the judge's language. Thus, this may involve costs. On the other hand, it is obvious that when it comes to proceedings, these (or similar) documents must be translated anyway.

 

Have you sent the form with supporting documents? Then the judge will forward it to your opposing party. The latter then has 30 days to respond substantively to your claim. You will then automatically receive the defense from the judge. An additional advantage is a correction option: if the judge believes that you have made an error in the form that entails inadmissibility (which means that the judge, for procedural reasons, will not be able to make a substantive assessment), you will be given the opportunity to correct the error.

 

The substantive assessment then takes place on the basis of the form and the attached documents, including the defense and the accompanying documents. If no (timely) defense is submitted, the judge decides solely on the basis of the plaintiff's documents. Only when the judge comes to the conclusion that he must decide on factual points that cannot be settled in writing, he may determine that an oral hearing (i.e., in person) must take place.

 

Executory title

The small claims procedure is thus, as already shown, aimed at a quick, simple and relatively inexpensive settlement of a case. But perhaps the greatest advantage of the procedure has not yet been discussed: the decision of the competent court in these cases immediately produces an "enforceable order for provisional enforcement. This means that, without first having to wait for an appeal, you can immediately execute the judgment (or have it executed), in principle through the bailiff. An example of the possibilities this offers: the bailiff may, with the enforceable title in hand, seize a bank account of a counterparty who does not want to pay. We previously wrote this blog post about seizure in the European Union. Moreover, this enforceable title is valid throughout the European Union (with the exception of Denmark).

 

Completion

You have seen that there can be quite a lot involved in proceedings against a person or company outside the Netherlands but within the European Union. The small claims procedure offers a quick, simple and relatively inexpensive solution to settle your problem. Moreover, it also provides you with an enforceable title, which allows you to enforce the judgment directly throughout Europe.

 

The European small claims procedure thus offers a good alternative. Does your claim exceed € 5.000,-, then the European bank seizure procedure could be an alternative.

Do you have a question about the possibilities for suing an opposing party abroad who refuses to pay? Or do you have another legal question concerning the collection of debts from a foreign legal person? Please feel free to contact one of our attorneys, who have many years of experience in this field.

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