News regarding the enforcement during Coronavirus outbreak (COVID-19)

On April 14 2020, the Government of the Republic of Croatia held a session at which it adopted the Bill amending the Law on Enforcement on Financial Assets. Below we list the news regarding the enforcement upon which has been decided during the Coronavirus outbreak (COVID-19).

Law on Amendments to the Law on Enforcement on Financial Assets

The Amendments to the Law on Enforcement on Financial Assets set out measures aimed at facilitating the position of natural persons to whom part of the income goes to enforcement in order to more easily bear the negative economic consequences arising from the special circumstances caused by the outbreak of the COVID-19 disease epidemic.

The amendment provides for a temporary suspension of all enforcements on money assets in a natural person’s account, thereby allowing natural persons to dispose of all income they receive into bank accounts in order to more easily overcome a period of special circumstances that significantly affects their financial situation.

Delay of the default rate delays is also regulated in such a way that they do not flow during the special circumstances. It should be borne in mind that these novelties only relate to the enforcement of money assets in the account through the Financial Agency (FINA) and not to the enforcement made on salary and other income (such as a pension), where part of the income is being confiscated, and the employer or the Croatian Pension Insurance Institute must pay the seized portion directly to the bailiff.

For this reason, Art. 25.a of the aforementioned Law states that during the special circumstances the Agency will cease to enforce money assets in relation to the debtors – natural persons. These special circumstances shall last from the date of entry into force of this Law until the expiration of a period of three months after its entry into force. Since the Law came into force on April 17 2020, the delay in enforcement will last until July 17 2020. The Agency will receive new payment bases after April 17 and treat them in such a way that they will be recorded in the Register, but in relation to the debtors – natural persons they will not send enforcement orders to the banks, that is, they will not block accounts.

Due to the fact that FINA ceases to enforce money assets in relation to all natural persons, natural persons who do not have any ongoing enforcement, over the next few days, will have their accounts unblocked. As an exception, FINA will not suspend the enforcement of money assests against the debtor – natural person if the enforcement is carried out to settle a claim for legal maintenance of the child, other claims when the enforcement is performed to settle future installments on maturity, claims on arrears but not paid salaries, remuneration or severance pay, in the case of criminal proceedings and in the event of enforcement of a specific purpose account (eg for the purpose of collecting a reserve).

Repayment of bail in electronic auctions delayed by coronavirus outbreak

Also, FINA (Financial Agency) has informed all e-Dražba users who have paid bail in order to participate in electronic auctions postponed due to the coronavirus epidemic that it is possible to receive a bail repayment in accordance with the Ministry of Justice’s instruction from April 1, 2020 pursuant to the Ordinance on the manner and procedure for the sale of immovable and movable property in enforcement proceedings.

For more information on enforcements, public auctions and bail, it is advisable to contact a lawyer who can advise you on this. Considering the situation we are in, associated with the Coronavirus Outbreak (COVID-19), we note that your presence during enforcement is not usually required. You can provide us with all the necessary documentation by mail or e-mail, and you can arrange a telephone conversation appointment with a lawyer for any questions or additional information.