Bills of Exchange Enforcement

Enforcement by attachment based on negotiable instruments is a special procedure for the rapid collection of claims based on cheques, promissory notes and bills of exchange (Enforcement and Bankruptcy Law (EBL) Articles 167-170/b). Because the instrument itself is considered strong evidence, the debtor’s ability to object is limited.

Commencement

The creditor submits the original instrument to the enforcement office, which checks whether it qualifies as a negotiable instrument; if not, the request is rejected. If so, a payment order is sent to the debtor together with a copy of the instrument.

Payment Order and Deadlines

• Warning to pay the debt and enforcement costs within ten days
• Objections that the instrument is not a negotiable instrument, or to the debt or signature, must be filed with the enforcement court within five days
• If no payment is made and no objection filed in time, attachment proceeds

Types of Objection

• Objection to negotiable instrument status: Where a mandatory element is missing
• Objection to the debt: Claims that the debt was paid, deferred or never arose; generally must be proven by documents
• Objection to signature: Claims that the signature is not the debtor’s; if unfounded, the debtor may face a fine and compensation

An objection does not automatically stop enforcement. The debtor may ask the enforcement court to suspend enforcement; the court may require security.

In Practice

For the creditor, complete elements of the cheque or promissory note are a precondition for fast results. For instruments lacking elements, enforcement without judgment or a debt action is used. Before enforcement, the creditor may also seek a precautionary attachment, which is generally easier to obtain on negotiable instruments.