Enforcement in Switzerland of a foreign judgment: the Lugano Convention
Enforcement in Switzerland of a foreign judgment: the Lugano Convention
In the previous posts, the recovery of debts in Switzerland has been examined in a summary and simply descriptive way, focusing on what the legislation provides for and what procedures have to be followed.
1. How to enforce a foreign judgment in Switzerland
We here address the question: of how a creditor in possession of an enforcement order obtained abroad can enforce it in Switzerland. This is specifically a matter of cross-border law, which is governed by, among other rules, the Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters, better known as the Lugano Convention, concluded in that city in Canton Ticino city on 30 October 2007.
All EU and EFTA member states participated in this convention, including Switzerland, which ratified it in 2009 and brought it into force on 1 January 2011.
2. The 2007 Lugano Convention
The 2007 Lugano Convention updated and replaced the 1988 Convention of the same name and regulates civil and commercial matters, with the exclusion of certain areas, mostly relating to personality rights, family law, and bankruptcy, etc. It also covers only the judgments that have been made by the courts.
A creditor in possession of an enforceable court decision must therefore first obtain a declaration of enforceability of the decision from the court that issued it. Once in possession of such a declaration, the foreign state must declare the enforceability of the judgment in its own country: this procedure (known as exequatur) is streamlined, since the foreign court does not have to enter into the merits of the judgment, but only to check that all the formal requirements for recognition laid down by the Lugano Convention are met.
In particular, the foreign state’s decision may be recognised:
– (positive requirement) if the formal requirements laid down in the Convention are met (e.g. presence of the declaration of enforceability, authenticity of the copy of the judgment,).
– and if (negative requirement) no serious violations are found (e.g. contravention of the decision to the public policy of the recognising state, failure to ensure adequate adversarial proceedings in the foreign state, contravention of the decision to another issued and final one).
The foreign judgment is recognised as enforceable by the court delegated to do so (in Switzerland, the district court). Once exequatur has been declared, the foreign judgment is to all intents and purposes equated with a domestic court decision of the “host” state and is therefore subject to that state’s rules on the enforcement of an enforceable title: Switzerland’s Enforcement and Bankruptcy Act LEF.
3. Seizure and precautionary measures
During the exequatur procedure, i.e. pending the procedure for recognition of the enforceability of a foreign judgment in his own State, the creditor may apply for protective measures, of a conservative nature, in accordance with the domestic law of the State in which the foreign judgment is to be recognised.
In this respect, there is a particularity in the enforcement in Switzerland of foreign judgments recognised under the Lugano Convention. Swiss law provides for an autonomous cause of seizure in the LEF linked solely to the creditor being in possession of a judgment recognised under the Lugano Convention. A creditor who has obtained an exequatur decision in Switzerland may therefore proceed directly with the attachment against the debtor domiciled there, regardless of the grounds of periculum in mora and fumus boni iuris ordinarily required (i.e. danger of delay and prima facie case).
It is a highly effective instrument for debt recovery in Switzerland, as it allows the creditor to obtain, in a short time and without excessive formalities, an immediate enforcement instrument of particular strength against the debtor domiciled abroad.
4. How much does it cost to have a foreign judgment recognised and enforced in Switzerland?
For this type of procedure, it is highly recommended that creditor consult a lawyer, as the matter involves international law. Therefore, in addition to the costs of justice, which are linked to the value of the claim asserted, there are also legal fees to be paid.
As for the costs of justice, these are advanced by the creditor, but are then placed by the court entirely at the debtor’s expense and then recovered in the actual enforcement phase. Legal fees are also recovered in part.
What is more important is that the chances of recovering the debt are very high in Switzerland, as can be seen from the preceding practice and considerations.
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Studio Legale Ciamei deals with such matters and is available to be contacted.
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