Minute to introduce the system of automated arrest of border funds

The introduction of electronic arrest of funds contained in the accounts of the debtor in banks and other financial institutions is one of the priority steps of the reform of enforcement of decisions and other bodies, as Ukraine has committed to the International Monetary Fund for the adoption of a law that automates the process of collection and compulsory debt collection.

At present, information on the debtor's accounts is received by the executor by sending a request to the State Fiscal Service of Ukraine. However, these data apply only to legal entities and sole proprietors. It is possible to receive information about citizens' accounts only by sending inquiries to all banking institutions by mail. In practice, debtors have time to withdraw funds from accounts, and sometimes the decree is lost at all and does not come to the bank.

In order to prepare the relevant draft law, a group of Ukrainian specialists led by the Ministry of Justice last November visited Croatia. In this country, the electronic arrest of debtors' funds held in bank accounts through the Financial Agency (FINA) has been introduced since January 1, 2011. The 32 banks that existed at that time in the republic, transferred to FINA 654 667 unexploited recovery documents for a total of nearly 8.7 billion euros. All outstanding paper documents have been processed and incorporated into the electronic system. На сьогодні агентство володіє інформацією про всі рахунки як юридичних, так і фізичних осіб, яка оновлюється щодня. Це гарантує блокування грошових коштів на банківських рахунках впродовж кількох хвилин.

Thanks to the introduction of innovations Croatia estimates drawn up for the World Bank report "Doing Business 2017", has risen 52 places to 7th place.

In addition, in February 2018, the delegation of the Ministry of Justice visited Portugal. The process of electronic seizure of funds in Portugal lasted from 2011 to 2013 with the support of the International Monetary Fund. This was preceded by the introduction of appropriate changes to the Civil and Civil Procedural Codes.

Prior to the introduction of new procedures for arrest of debtor funds and looked like the one that currently exists in Ukraine and was characterized by a paper document, which considerably slowed down the recovery of funds from the debtor and zdorozhuvalo procedure.

Today, Portugal has a fairly simple and efficient system. The whole process can be conventionally divided into three stages: 1) the periodic filling of commercial banks database of all accounts of individuals and legal entities, which is maintained by the Central Bank of Portugal; 2) communication with the Central Bank for information on accounts of debtors; 3) communication of performers with commercial banks, in which accounts of debtors are opened, for the debit of funds from them. At the same time, the Central Bank does not have the power to change the information contained in the database. It only performs the function of the system keeper and the guarantor of its operation.

The main guarantee of maintaining bank secrecy with regard to information about debtor accounts is that information contained in the Central Bank database does not reflect the amount of funds on such accounts.

By the time the Portuguese automated arrest system was introduced in bank accounts, enforcement of court decisions was extremely unsatisfactory. Thus, during 2003-13, the total amount of the penalty was about 20 million euros. After implementation of the automated system, for 2014-15, the amount of execution amounted to 337 million euros. And finally, for only 2017, this sum amounted to 600 million euros. That is, the performance in monetary terms has increased 30 times.

The experience of Croatia and Portugal shows the great effectiveness of introducing a system of electronic arrest of funds on bank accounts in the execution of court decisions. Ukraine needs to start real steps in transition from paper to electronic interaction of the main actors in the area of arrest of funds on bank accounts in order to increase the level of enforcement of court decisions. It is worth paying attention to the willingness of external donors to significantly contribute to this process, providing the necessary technical assistance for this.

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