The European Account Preservation Order - UK Government announces decision on participation
Earlier this year, the European Commission unveiled a proposal for an EU Regulation to create a European Account Preservation Order ("EAPO"). This would create a standardised mechanism by which courts of EU Member States would be able to grant an order to freeze a defendant’s bank account within another Member State in support of a claim. More on the detail of the Commission's proposals can be found in our original briefing note.
Following the publication of the European Commission's plans, the UK Government opened a consultation into whether the UK should opt in to the Regulation (the measures falling within provisions of the TFEU in respect of which the UK can decide whether to do so). This consultation closed on 14 September. Linklaters submitted a response to this consultation.
On 31 October the UK Government announced, by way of written statement to the House of Commons, its intention not to opt in to the proposed Regulation. The Government's statement highlights concerns regarding the level of protection granted to defendants under the proposal and the potential burden that would fall on the UK Government and banks as the main reasons for this decision.
Standing outside of the proposed Regulation would mean that, upon any such Regulation coming into force, the UK courts would not have power to grant an EAPO and, conversely, EAPOs could not have effect in the UK. This may not, however, be the final position. The Government's statement indicates that it still intends to participate fully in the negotiations in the hope that sufficient changes are made for it to seek a post adoption opt-in (the same strategy as it adopted in respect of the Rome I Regulation on the law applicable to contractual obligations).
The UK Government's statement in full can be viewed here.