Significant changes to commonest form of debt collection

New rules for payment warrant procedure as of 1 January 2018

As of 1 January 2018, essential legislation included the rules governing the payment warrant procedure have been amended. Our article aims to draw attention to the most important changes, as failure to apply them may lead to serious legal consequences.

1. Change of thresholds

In principle, claims not exceeding 3 million HUF (approx. 9 500 EUR) can only be enforced through a payment warrant. So the legislator directs small claims towards the payment warrant procedure, while at the same time directing higher-value cases towards litigation, since from this year claims over 30 million HUF (approx. 95 800 EUR) cannot be enforced by means of a payment warrant. (Previously, the threshold was 400 million HUF, approx. 1 278 000 EUR).

2. Foreign creditors without a Hungarian address for service cannot start a payment warrant procedure

Under the amendments, both the defendant and the party initiating the proceedings (claimant) must have an address, habitual residence, registered seat or commercial representation in Hungary. Thus without a Hungarian address for service, the procedure cannot be initiated and a notary will reject the application accordingly even when e.g. the foreign company has a Hungarian legal representative. This means that in the future foreign companies cannot start the payment warrant procedure against their Hungarian debtors. However, the European order for payment procedure can be used instead as a new method for debt collection.  

3. Filing rules tightened

In the case of failure to collect documents delivered electronically, they will no longer be delivered by mail. If a party required to communicate electronically (e.g. firms, individual entrepreneurs, a party represented by legal counsel) fails to collect a document within the time limit set by law, the document will be considered served on the fifth working day following the date of the second notice, which means that fictional delivery occurs.

4. The rules for statement of opposition have also been amended

Under the new regulation, individual entrepreneurs can also only lodge a statement of opposition electronically. This means that if a statement of opposition is filed on paper, the notary will reject it, so the payment warrant will be treated as never having been opposed.  

The amendments aim to accelerate enforcement of monetary claims, in addition to harmonizing legislation.


Source: Act L of 2009 on the Order for Payment Procedure

Abonare la știri

Prin tastarea 'Abonare' sunteți de acord cu condițiile noastre de prelucrare a datelor personale