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					RESPONSE TO GREEN PAPER EFFECTIVE ENFORCEMENT OF
JUDGMENTS IN THE EUROPEAN UNION: THE TRANSPARENCY
                               OF DEBTORS’ ASSETS
                                     October 2008
This response has been prepared by the Law Society of England and Wales. The Law
Society is the representative body of over 120,000 solicitors in England and Wales. The
Society negotiates on behalf of the profession and makes representation towards
regulators and government in both the domestic and European arena.

We welcome the opportunity to respond to the Green Paper which considers the issue of
improving cross-border debt recovery by increasing the transparency of debtors’ assets.

We believe that practical measures should be taken to enforce the enforceable, provided
that such measures are transparent, fair and consistent with human rights. We would
emphasise that defendant’s interests must be duly and sufficiently taken into account
and that data protection issues have to be taken into account.

However, we believe that before continuing work in this area, the Commission should
examine whether all Member States have a system that allows a declaration of debtor’s
assets to be obtained irrespective of where the assets are held, in order to establish
whether a separate European procedure would in fact be of added value.

The Law Society’s response to each of the questions in the Green Paper is set out
below.

Question 1:
Do you consider that there is a need for measures at Community level to increase the
transparency of debtors’ assets?
Do you consider that the interface between enforcement of judgments and debtor
protection or the role of non-public organisations in the enforcement of judgments need
explicit attention in this context? If so, which elements do you consider important?

We agree that there is a need for measures at Community level to increase the
transparency of debtors’ assets to make the public enforcement of judgments across
borders easier.    The measures should not constitute harmonisation of existing
enforcement measures. They should complement and not replace current procedures.
They should be restricted to cross-border cases.

There should be safeguards to protect debtors’ rights and information should only be
requested following a judgment in favour of the creditor delivered after a fair hearing.
There must be appropriate safeguards in place to comply with data protection legislation,
human rights legislation and the European Convention on Human Rights.

Question 2: In what ways do you consider that a manual containing all information
about the enforcement systems of the Member States would be helpful?

A manual containing all information about the enforcement systems of the Member
States would be helpful. The manual should be accessible on-line and contain relevant
links. It should be user-friendly and in simple language. It should be kept up to date.
One body should be responsible for coordinating it to ensure that it meets with these
requirements.




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Question 3: Should information available in and access to commercial registers be
increased? If so, how and to what extent?

We do not support the full harmonisation of commercial registers, the compulsory
centralisation of commercial registers and the compulsory extension of them to include
individuals and business partnerships.

We do support the networking of local and national commercial registers for use in
cross-border cases provided that the right to privacy, including data protection, is
respected.

Question 4: Should access to existing population registers be improved? If so, how?


Question 5: Should access to social security and tax registers by enforcement
authorities be increased? If so, how and to what extent?

We have serious concerns regarding using information gathered for one purpose for
another purpose. We are particularly concerned about affording enforcement authorities
access to population, social security and tax registers for the purposes of enforcement of
cross-border judgments. The right to privacy, including in data protection, should not be
erased by the necessities of law enforcement and must be respected.

We note that the United Kingdom does not have a population register.

Moreover, access to tax registers would conflict with the duty on tax collectors and
inspectors not to use information other than for the purpose of carrying out their duties or
for the purposes of tax prosecutions. Access to social security registers would conflict
with the duty not to use information provided by individuals to claim social security
entitlements for other purposes.

Question 6: Should the exchange of information between enforcement authorities be
improved? If so, how?

Exchange of information between enforcement authorities must only be done following
the order of a national court to obtain the information following a fair hearing of the
debtor. It must only be done on a case by case basis and must be limited to the
information necessary for the enforcement of the particular debt. There must be
stringent safeguards concerning the right to privacy, including data protection, and the
protection of the debtor’s rights and preventing the use of such information outside the
narrow scope of the enforcement of the particular debt. The proportionality principle
must be duly taken into account, limiting the data that must be disclosed by the debtor to
that which is proportionate to the specific purpose pursued in the specific case.

Question 7: Do you consider that a European Assets Declaration should be introduced?

We support a European Assets Declaration which would oblige debtors to disclose all
assets in the European Judicial area. However, it should be limited to cross-border
cases and should not affect existing national systems.




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Question 8: If so, under what conditions should it be possible to obtain it? Should there
be sanctions for incorrect statements contained in the declaration? If so, which?

Debtors should only be obliged to complete a European Assets Declaration after a
relevant court decision on the merits has been obtained at which the debtor had a fair
hearing, proving that they are in debt. They should only be obliged to complete a
European Assets Declaration on a case-by-case basis.

The declaration should be made in person to a court to ensure that the information can
be verified and so that the debtor is under an obligation to tell the truth. For example, in
England and Wales such declarations are made under oath.

Sanctions for not making a European Assets Declaration or for making false statements
in it should be proportionate and at the discretion of the national court.


Question 9: What degree of harmonization do you consider appropriate for the
European Assets Declaration? What should be the precise content of the European
Assets Declaration?

We do not support harmonisation of existing enforcement measures. A European
Assets Declaration should complement and not replace current procedures. It should be
restricted to cross-border cases.

It should comprise minimum standards for the content of the declaration.

It should not stipulate that criminal sanctions should be applied in the case of non-
compliance. We are opposed to the introduction of minimum or uniform sanctions as
this should be at the discretion of the national court.

We are also opposed to any attempt to limit the level of redress available through the
civil process.

Question 10: Which other measures at EU level do you propose to increase the
transparency of debtors’ assets?

We can see merits in a single European litigation claims procedure for cross-border
uncontested claims and cross-border small claims and in particular in conducting a
review of the interaction between the European Payment Order and the Small Claims
procedure with a view to allowing a coherent standalone cross-border procedure with
one form. We can see merits in a standard procedure for cross-border matters with
simple and effective forms but not harmonisation impinging on national sovereignty. The
transparency of debtors’ assets could be explored in and restricted to this specific cross-
border context.




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For more information please contact:

Susan Clements
Justice and Home Affairs Policy Advisor
Law Societies Joint Brussels Office
Avenue des Nerviens, 85 - Box 10
B-1040 Brussels
Belgium

Tel : +32 2 743 85 85
Fax : +32 2 743 85 86

Email : susan.clements@lawsociety.org.uk




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