“Efficient and effective enforcement, a fundamental right under the Rule of Law“ Jos Uitdehaag

European payment index 2011: written off debt increased 4% or Euro 312 billion (or in the period a massive Euro 1,300 billion) 2010: some 600 companies per day went into liquidation, amounting total 220,000 Negative impact on the development of economics: Ability of companies to stay liquid; Investments in R&D Employment Tax receipts

Article 6 ECHR The fundamental right to a fair trial as guaranteed by this article 6 also includes the enforcement of court decisions within a reasonable time. Fair trial is an illusion if there is no effective enforcement system. ECHR, 19 March 1997 (Hornsby vs. Greece): the right of access to a court “would be illusory if a Contracting State’s domestic legal system allowed a final, binding judicial decision to remain inoperative to the detriment of one party”. Based on these principles on 9 September 2003 the Committee of Ministers at the 851st meeting of the Ministers’ Deputies of the Council of Europe, adopted Recommendation Rec (2003)17 on enforcement. December 2009 these were followed by a set of CEPEJ Guidelines

Reasons for Rec 17/2003 and the 2009 Guidelines The principles of the rule of law Article 6 and the fair trial principle Need for greater efficiency and fairness in enforcement To avoid private justice

Definition of an enforcement agent: Rec 1B: enforcement agent “Enforcement agent” : a person authorized by the state to carry out the enforcement process irrespective of whether that person is employed by the state or not; The Council of Europe in the above mentioned Recommendation did not take a formal position on the professional and institutional status of the enforcement agents.

Typology of enforcement systems Court oriented system of enforcement implementation of court judgements in the hands of judges Civil servants Implementation by state agencies, executive and civil servants (e.g. Ministry of Finance or Justice) Entrepreneurship Bailiffs as enforcement agents (high or low level of regulation). Scandinavian countries Russia Germany France Belgium, Netherlands Great Britain Slovakia Austria Croatia

European trends There seems to be a trend towards the liberal status in recent decades. What is the reason of this popularity of the enforcement agent as a self-employed person? Does it meet with the requirements of the principles of the “Rule of Law” and Council of Europe Recommandation Rec (2003) 17?

Private enforcement agents versus civil servants The Council of Europe in the above mentioned Recommendation did not take a formal position on the professional and institutional status of the enforcement agents. This seems logic: – national legal systems differ from each other and – it would be impossible for one of these legal systems to be the benchmark for all the other systems.

Figure Status of enforcement agents

Advantages and disadvantages CourtExecutiveBailiffs Advantages Professionalism High standards Level of debtor protection. Fast. Flexible Less expensive for State budget Rapid Efficient Inexpensive for State budget Professional quality. Disadvantages Expensive Slow Rigid Over-formalised Lack of quality Lack of independence Opportunity for corruption Costly for consumers Difficult to change Need for control

The enforcement agent as a civil servant Division of the work: more intellectual aspects of enforcement (Germany: Rechtspfleger) and the “foot soldiers” who effect the practical work (Germany: Gerichtsvollzieher). The enforcement agent as a civil servant is NOT an enforcement specialist: legal knowledge and practical skills are divided into different professions/persons. Enforcement agents have limited competences. In the absence of competition, the quality of the work is driven by targets and budgets in stead of the interests of the individual creditors.

The enforcement agent as a civil servant II In most cases the organization is rather bureaucratic and hierarchic. The work of the civil servant in most cases is employer orientated and not client orientated. In some countries, e.g. Sweden, tax collection is the base. Enforcement of other judgments seems to be a smaller part of the duties. Contrary to their independent colleagues lobbying in most cases is not developed and other legal professions might have a greater input into e.g. legislative proposals

The enforcement agent as an independent professional Being independent the enforcement agent will be market orientated. The independent professional will look for an extension of the range of activities, e.g. by amicable debt recovery. However this is just one side of the story. Although the independent professional is market orientated this should never undermine the respect for ethics and the demands of the system of justice.

Changing the system State point of view: law reform Profession point of view: mentality Market point of view: profit and wealth versus fairness and efficiency

Advantages In a market based system the costs of enforcement are no longer supported by the State budget In a market based system efficiency and flexibility is at its best

Best choice? Does this mean that the trend towards the independent professional based system is the best choice? It could be: However especially in such a system it is necessary to find a balance between the authority that has been given to the private enforcement agent on the one hand and on the other hand the control over the way that power is used.

Best choice? Legal knowledge and training Appointment criteria Organization Professional and ethical standards Monitoring and control Liability

Conclusion In recent years several EU countries had a reform of their enforcement system. Not just the ten new EU members but also in other countries In almost 100% of those countries a change was made towards the liberal profession. Not as a coincidence it seems. The independent profession seems to be the best system available. As we have seen it is much more efficient and it is cost saving for the State.

Trends in enforcement 35. Enforcement agents should be obliged to perform their role whenever they are legally required to do so except in cases of impediment or where they are related by blood or marriage to a party.

Trends in enforcement II 34. Enforcement agents may also be authorized to perform secondary activities […]. These may be, among others:  debt recovery;  voluntary sale of moveable or immoveable property at public auction;  seizure of goods;  recording and reporting of evidence;  serving as court ushers;  provision of legal advice;  bankruptcy procedures;  performing tasks assigned to them by the courts;  representing parties in the courts;  drawing up private deeds and documents;  teaching.

Trends in enforcement III Cooperation, establishment of networks Use of IT Cross border enforcement: EU and South East Europe initiatives The developments in EU: one judicial area A harmonized status for the enforcement agent?