Position of the German Bar Association

Transcription

1 Berlin, July 2008 Opinion No. 39/08 Position of the German Bar Association Civil Procedures Committee on the Green Paper of the European Communities on effective enforcement of judgments in the European Union: transparency of debtors assets COM(2008) 128 final.; Consultation doc. 7403/08 Bundesrat publication 166/08 Members of the civil procedures committee: Dr. Bernd Hirtz, lawyer (Chairman) Hartmut Braunschneider, lawyer (rappporteur) Dr. Jochen Bühling, lawyer Curt Engels, lawyer Dr. Hans C. Lühn, lawyer Dr. Carsten A. Salger, lawyer Prof. Dr. Volkert Vorwerk, practising lawyer at the Federal Court of Justice Responsible DAV executive: Angelika Rüstow, lawyer 1

2 Europe distributors: European Commission: DG Justice, Freedom and Internal Affairs European Parliament: Committee on Legal Affairs Committee on Civil Liberties, Justice and Home Affairs Committee on the Internal Market and Consumer Protection Council of the European Union Permanent Representative of Germany to the European Union Representations of the German Federal Länder in Brussels Council of Bars and Law Societies of Europe (CCBE) Contact: German Bar Association Brussels Office Lawyer Dr. Karolin Hartmann, LL.M. Avenue de la Joyeuse Entrée 1 B-1040 Brussels Belgium Tel: +32 (0) Fax: +32 (0) bruessel@eu.anwaltverein.de National distributors Federal Ministry of Justice Legal Committee of the Bundestag Legal Committee of the Bundesrat SPS group in the Bundestag CDU/CSU Group in the Bundestag, Legal Working Group Bündnis 90 Group/The Greens in the Bundestag FDP group in the Bundestag DIE LINKE [Left] group in the Bundestag Board and management of the German Bar Association Presidents of the Legislation Committees of the German Bar Association President of the FORUM Junge Anwaltschaft German Association of Judges 2

3 German Association of Tax Advisers Federal Chamber of Attorneys Federal Chamber of Notaries Association of Tax Advisers Deutscher Gerichtsvollzieherbund e. V. [German Bailiffs Association] NJW [Neue Juristische Wochenschrift] editorial board Unified Services Sector Union, Federal Office, Federation and Länder, Judges, Prosecuting Attorneys Contact: German Bar Association (DAV) Rechtsanwältin Rüstow Littenstraße 11, D Berlin Tel XXX Fax:

4 Preface The German Bar Association [Deutsche Anwaltverein (DAV)] is a voluntary association of German lawyers. With a current membership of approximately , it represents the interests of German lawyers at national, European and international level. The aim of the Green Paper submitted by the European Commission is to kick off a comprehensive discussion of the issue of improving the transparency of debtor assets in the European Union. The Green Paper describes the current problems and proposes possible solutions. The German Bar Association s opinion is as follows: A. Proposals regarding improved transparency of assets must approach the situation holistically. Firstly there is the question of the conditions under which transparency may be required. Secondly is the question of whom this transparency should relate to. Thirdly is the question of the extent to which a person s assets should be outwardly transparent. Fourthly is the question of how this extent should be reached. I. If a person is indebted to another person (the creditor), an obligatory relationship arises among them. Under German law, this can either be based on voluntary contact (context of transactional obligatory relations) or be independent of the will of the parties (statutory obligatory relations). As long as an obligatory relationship is properly concluded (according to time, place and performance), there is no requirement (which would require authorisation) for transparency of assets. This would change if the debtor fails to voluntarily discharge his performance in line with the debt and has to be forced to do so. 4

5 On the assumption there is a valid legal title to adequately corroborate the existence of the debt, the existence of the debt is found to be legally positive either through voluntary cooperation by the debtor (e.g. by settlement), or through state authority (e.g. through a judgment). Only after this has been established is it legally correct to speak of debtor, creditor or debt. Only after this can a demand for transparency of debtor assets be justified. The privacy protection interests of every person have legal limits where the person has renounced this privacy by becoming a debtor. It does not matter whether this depended on the will of the person (transactional obligatory relations) or not (legal obligatory relations). Insofar as debt exists, protection of privacy has to give way to the extent that this will contribute to settlement of the debt. The image of a counterweight does not accurately describe the situation, as privacy and creditor interests are two poles of a single relationship. II. Obligatory relations fundamentally only affect the relations between the persons involved therein. A debtor s privacy is only relinquished in respect of these parties. It therefore follows that a debtor must only accept transparency in respect of those parties. This would especially apply to the creditor as well as the persons and institutions that the creditor must rely on to assert his claims (courts, recovery agents, etc). The transparency to be accepted should not therefore give third parties (in particular government bodies) carte blanche to avail themselves of the data being divulged in a context unconnected with the obligatory relations. 5

6 III. The transparency to be created must be related to a particular purpose. Its aim should be to facilitate an obligatory relationship. As soon as, and insofar as this purpose has been achieved, there is no more requirement for transparency. Protection of privacy is (then again) restored to a status to be valued more highly. The requirements of the principle of proportionality must be observed (according to Directive 95/46/EC of , which deals with transparency as intervention in privacy, the resolution of legally recognised obligatory relations as a legitimate purpose, the suitability of transparency for settlement, no milder means than transparency, considerations of transparency versus privacy). IV. Intervention in debtor privacy would be kept to a minimum if the debtor were able to choose what to divulge about his/her assets, when to divulge and how. However, both the stage in time in the dispute (enforcement) and practice show that debtors do not use these freedoms primarily to honour their obligations. Granting a debtor freedom as to what he/she makes transparent would only be acceptable if, and only inasmuch as, this transparency contributed to dealing with the obligatory relationship If this contribution is not apparent in such a closely defined framework, comprehensive transparency should be obtained from the debtor himself, and also from any other available sources. B. On this basis, our answers to the questions are as follows: Re 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 6

7 organisations in the enforcement of judgments need explicit attention in this context? If so, which elements do you consider most important? Question 1: Yes. There is a need for measures at Community level to increase the transparency of debtors assets. One reason is the mere fact that the present multiplicity of cross-border cases results in legal action which is economically unviable: at present, the regulations in each Member State need to be determined before deciding on a course of action. In particular, the fees chargeable in enforcement matters, which are not negligible, also prevent operating in a way that would cover costs. Additionally, knowledge of the legal situation in other countries would have to be kept updated along with that of the legal situation at home. This results in a multiplication of obligations having the same subject. Attention should be paid to the interface. Debtor protection (privacy) and creditor protection (enforcement) can be regarded as opposing poles in one relationship. As long as the nature and/or extent of the attribute of debtor remains unclear (disputed), the debtor is worthy of more protection than the creditor. If there is a legal title clarifying the nature of the debtor, the situation is reversed: in this case, more consideration should be given to the creditor s interests than to the debtor s. Nongovernment bodies should always be regarded from a position deriving from the creditor s position. The above relates only to the aspect of debtor asset transparency. It does not cover other aspects of protection in enforcement. 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? [Re] Question 2: 7

8 Such a manual would be extremely helpful, as it would draw together the diversity of information mentioned in I in a single reference book which would make individual research feasible. This is, of course, conditional on it being constantly updated. This would probably make electronic publication only feasible. It is, however, only the second-best option. Replacing diversity with unity would be preferable to making diversity more easily accessible. Question 3: Should information available in and access to commercial registers be increased? If so, how and to what extent? Re Question 3: Commercial registers should apply to all forms of enterprise, including sole traders. Anybody who is trading is exposed to the public in pursuit of their economic interests, and thereby relinquishes his/her private sphere. The commercial register should therefore include all circumstances relating to the trade in question. In respect of enforcement and transparency of debtor assets, these would include information on places of relevance to the enterprise (all places of business), personal data (participants/organs/representatives, but employee numbers are not necessary), and financial data (balance sheets, P&L accounts, etc.) Registers are only valuable insofar as they can provide information. Separate individual registers are therefore less valuable than one central register. However, the way in which they are organised is ultimately irrelevant if several irrespective of how many - individual registers can be evaluated with one single query. This corresponds to the idea of a register portal, or a register search engine. Ideally, one single query would be enough to generate an answer from the registers of all Member States. It should be easy to access and not require any special proof of identity, i.e. it should be open to everyone. No limits regarding the scope of the data sought are indicated. The data in the commercial register contain no confidential private information, and are not sensitive. 8

9 Question 4: Should access to existing population registers be improved? If so, how? Re Question 4: Population registers have the same fundamental problem of being disparate. The solution is therefore fundamentally the same (maximum centralisation for the purpose of queries). Insofar as the registers also include persons who are not entrepreneurs, these data must be allocated by default to the private sphere and thus not divulged to creditors. Only if a person in the register becomes a debtor does he/she emerge from the private sphere. This, however, would first have to be legally proven when a legally valid order has been issued. The current practice of referring to population registers in preliminary legal proceedings requires no discussion here. In any case, enforcement entails the issue of an order, even if it is only provisionally enforceable. For this reason, access to population registers should be subject to the submission of proof. Technically, an analogy to the certificate of no appeal [Titel mit Rechtskraftvermerk] needs to be produced. Electronic signatures issued at the application of the court of first instance in accordance with legal validity, and which the recipient would use to access population registers, should be considered. The granting of such a signature could be applied for by the creditor or the creditor s attorney. After this has been issued, the creditor or his attorney could use the signature himself or delegate them to enforcement bodies (bailiffs). Question 5: Should access to social security and tax registers by enforcement authorities be increased? If so, how and to what extent? Question 5: 9

10 Social security/tax registers have the same fundamental problem as all other state registers of being disparate. The solution is therefore fundamentally the same (maximum centralisation for the purpose of queries). Conflicts with the various types of confidentiality (social security/tax confidentiality) or with data protection should be resolved in the creditor s favour. A legally valid order is the confirmation by the state that the creditor has a claim against the debtor and the debtor has no submitted no objections or pleas against it. There is no discernible legitimate interest the debtor could have to demand protection of secrecy from the state which would hinder enforcement of an order that has been issued by the state. Access should take place as in the case of the population register. Re Question 6: Should the exchange of information between enforcement authorities be improved? If so, how? Question 6: If access to registers were granted in the manner discussed in Questions 5 and 6, enforcement authorities should have no problems in cooperating, although this would no longer be necessary for the purposes of information exchange as every enforcement authority in every country would have, under the qualified conditions set out (a legally valid order/electronic signature), direct access of its own to all relevant registers. Question 7: Do you consider that a European Assets Declaration should be introduced? 10

11 Re Question 7: A European Assets Declaration is fundamentally sensible. 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, how? Re Question 8: A declaration should be received by a certain deadline. A debtor should be given the opportunity to avert having to make a declaration before that deadline (until the submission of the declaration) by meeting the debtor s demands. The debtor should, as an alternative to payment, offer items of value which (after being sold) could result in payment (a form of substitute performance). False declarations should be subject to prosecution. A statutory declaration would not appear necessary here. Non-disclosure should be subject to a fine and enforcement. Publication on a debtor list is unavoidable. This would help to protect potential new creditors, but should not involve a fee for the debtor. It is inappropriate for a debtor to enter into new undertakings that cannot be fulfilled. The burden is on the debtor, on account of such an entry, to justify his/her inclusion on the list to potential counterparties. However, it should be encouraged that lists of debtors also are either centralised as soon as possible (ideally at European level), or that at least central access is provided to all lists. 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? Re Question 9: 11

12 The question is unclear. Full harmonization at European level is appropriate. The Declaration should cover all conceivable assets owned by the debtor. Restricting it to those assets that are sufficient to satisfy the outstanding claim makes no sense in the light of the answer to Question 8. The debtor always has the possibility of avoiding a declaration by making offers in settlement. 12