A survey conducted in 2010 found that up to 40% of companies were willing to expand to more foreign markets, if the resolution of cross-border disputes was simpler and less of an administrative burden.

In conjunction with this survey, the EU decided on an amendment of community law governing the enforcement of judgements abroad.  This primarily concerns Council Regulation (EC) No. 44/2001, on the jurisdiction and recognition and enforcement of judgements in civil and commercial matters (hereinafter “Brussels I Regulation”). The Brussels I Regulation came into effect on 1 March 2002, and for the Czech Republic from the date of its entry into the European Union, i.e. 1 May 2004. The most recent amendment of the Brussels I Regulation came into effect on 10 January 2015 and its aim was to “facilitate the free movement of judgements and enhance access to justice”, as stated in the preamble to the report of the Commission to the European Parliament, the Council and the European Economic and Social Committee on the application of Council Regulation (EC) No. 44/2001, on the jurisdiction and recognition and enforcement of judgements in civil and commercial matters of 21 April 2009.

So, what’s new in the enforcement of judgements abroad?

1.      Procedure before 10 January 2015

According to the wording of the Brussels I Regulation prior to the above amendment, it was possible to enforce a foreign judgement in another MemberState, provided the following conditions were met:

a)      the judgement fell within the scope of the Brussels I Regulation;

b)     the judgement was enforceable;

c)      grounds for refusing recognition or denying enforcement had not been successfully brought against the judgement.

Further, a translation of the judgement, together with certification of its authenticity needed to be submitted for the enforcement of a foreign judgement at the relevant court or body of a MemberState at which the enforcement of a judgement issued by another MemberState was sought.

Prior to submitting a motion for the enforcement of a judgement, it was also hitherto necessary to submit a motion for a declaration of the enforceability of the given judgement, or so-called exequatur. In these proceedings, the relevant court verified that the conditions for the enforcement of the judgement in a foreign country were met in a special procedure and subsequently confirmed the enforceability of the judgement. This confirmed judgement was called a European Enforcement Order. However, this is an administratively and financially demanding procedure and the process of issuing a European Enforcement Order is associated with considerable costs.

2.      Procedure after 10 January 2015

The amendment of the Brussels I Regulation aimed at reducing the timeframe and financial demands and costs of cross-border disputes, eliminates the need to apply for a European Enforcement Order, or confirmation of the judgement for enforcement in a foreign country, and from now on, all judgements issued in a Member State should be recognisable and enforceable in all other Member States without further special procedures.

Thus, if a creditor is issued with a final judgement in one MemberState, it will be possible to enforce this decision in any other MemberState, as if enforcing a judgement in its home state. The only exception is the need for an official translation. As a result, both companies and ordinary citizens will be able to exercise their rights abroad more quickly, more easily and without the costs of proceedings for the issue of a European Enforcement Order.

The amendment of the Brussels I Regulation also brings other new changes, however, their description would exceed the scope of this article. In brief, these include increased consumer protection for purchases in other than the buyer’s home MemberState. Hitherto consumers could not exercise their rights when buying goods from a trader located in a country outside the EU, but selling its products in a MemberState. As a result of the amendment, consumers will be able to turn directly to their home court in these cases and will not be forced to resolve the dispute in a foreign court.

The amendment also allows employees working in a MemberState to take legal action against their employer, based in a country outside the EU, in the place they normally work.

3.      Conclusion

In view of the above, it can be held that the amendment of the Brussels I Regulation fulfils its fundamental objective, which is to simplify, accelerate and cut the costs of the recognition and enforcement of judgements issued in one Member State in the territory of another Member State, and this primarily by eliminating the need to obtain a declaration of enforceability.

For more information, please contact our office’s partner, Mgr. Jiří Kučera, e-mail: jkucera@kuceralegal.cz ; tel.: +420604242241.