Revision of the attachment and execution law: mandatory electronic garnishment on its way!

Several components of the proposed legislation won’t take effect until the first of January 2021, but as of the first of October 2020, the Act on the revision of the attachment and execution law (the Act) has entered into force.It provides for various amendments to the Civil Procedures Codes (CPC) and the Bankruptcy Act and aims to achieve three goals: the protection of the subsistence minimum of the debtor in case of attachment, to prevent the use of attachment and execution solely as a means of exerting pressure, and finally, a modernisation of the attachment and execution law by making it simpler and by strengthening its efficiency.

One of the planned modernisations entails the imposition of a mandatory electronic garnishment as of the first of January 2021, which will be discussed in this blog.

From optional to mandatory electronic garnishment

A creditor can recover his claim by means of an attachment on the debtors assets. The debtors assets also includes his claim on third parties, such as salary, insurance payment or bank balance. Recovering a claim by attachment on the debtors assets, when third parties have possession over these assets, is called garnishment. In this case, the third party is referred to as the garnishee.

In the current situation, it is possible for the bailiff to serve the garnishment electronically, if the garnishee has provided an electronic address to an organization designated by the Minister of Justice (art. 475(3) of the CPC). The Royal Federation of Bailiffs has been designated as an organisation in terms of art. 475(3) CPC, by Decree (5602959/09/6) of the State Secretary for Justice (d.d. third of June 2009). The bailiff can also choose to serve the garnishment in a non-electronic manner, despite an electronic address being provided.

The aforementioned choice will lapse. If the garnishee provides an electronic address to the Royal Federation of Bailiffs, the bailiff will be obligated to serve the garnishment electronically to the provided address. The entry into force will be no sooner than the first of January 2021, to give bailiffs the opportunity to connect to the system developed by the Network of Bailiffs Institute (Stichting Netwerk Gerechtsdeurwaarders), which development was commissioned by the Royal Federation of Bailiffs.

For the time being, the tax authority is exempted from the mandatory electronic garnishment since it currently lacks the facilities to make this transition. Needless to say, the tax authority has some other time-consuming dirt to get rid of. This exemption will lapse as soon as the tax authority has developed the required facilities. It is certainly conceivable that it will take a while before this is completed.

Final Remarks

For parties who regularly have to deal with garnishment, such as banks, insurance companies or large employers, the Act offers a step forward to a more efficient way of working. Still, it is important to remain alert for practical hurdles. An electronic garnishment is only possible when the garnishee has pointed out to be sufficiently available by email. It is therefore important for the addressee (the one responsible within the organization) to keep a close eye on his or her email.

If you have any further questions about the mandatory electronic garnishments or other components within the Act on the revision of the attachment and execution law, please contact us or use the sources below.

  • Wet herziening van het beslag- en executierecht (Stb. 2020,177)
  • Besluit van de Staatssecretaris van Justitie van 3 juni 2009, 5602959/09/6
  • Besluit van 15 juli 2020 tot vaststelling van het tijdstip van inwerkingtreding van de Wet van 3 juni 2020 tot wijziging van het Wetboek van Burgerlijke Rechtsvordering en de Faillissementswet in verband met de herziening van het beslag- en executierecht (Stb. 2020, 177)
  • Memorie van Toelichting bij Wijziging van enkele belastingwetten en enige andere wetten (Overige fiscale maatregelen 2021), p. 14-15.