Indicator for Ukraine Facility: Parliament Passes Law Streamlining Debt Collection

The Verkhovna Rada of Ukraine has adopted an important legislative bill, numbered 14005, which received backing from 250 members of parliament. This law aims to modernize and accelerate the enforcement of court decisions by implementing cutting-edge digital solutions that will enhance the efficiency of the process.

According to the approved document, amendments are set to be introduced to several key legislative acts, including the Commercial Procedural and Civil Procedural Codes, as well as laws governing traffic, notary services, banking activities, mortgages, the depository system, state registration of property rights, legal entities, enforcement proceedings, capital markets, and social insurance.

One of the key innovations of the law is the provision for issuing court decisions and other enforcement documents in the form of electronic documents with digital signatures. This innovation will significantly expedite the process of transmitting these documents for enforcement, which, in turn, is expected to positively impact the effectiveness of law enforcement.

Furthermore, the law provides for the establishment of an updated automated system (ASVP), which will be responsible for distributing cases among state executors, automatically generating documents, and sending them to the parties involved. This system will also enable executors to access information about the property, income, and bank accounts of debtors from various state registers, greatly simplifying their work.

The law also strengthens oversight of debtors. The system will now automatically check an individual's presence in the Unified Register of Debtors when performing important actions. This will help reduce the risks of evading obligations.

One of the significant aspects of the new legislation is the provision regarding property restrictions. If an individual or company is listed in the debtor register, notaries and service centers of the Ministry of Internal Affairs will be required to refuse the sale or re-registration of vehicles, real estate, and other assets, with certain exceptions, such as when the sale is conducted to settle a debt.

Banks will also face new obligations: they will be required to inform executors about the opening or closing of accounts belonging to individuals listed in the debtor register. This will ensure more transparent monitoring of financial transactions involving debtors and their assets.

An important element of the new system is the establishment of automatic data exchange between the Debtor Register and other databases, such as the Vehicle Register and the Register of Property Rights. This will facilitate the prompt imposition or lifting of property seizures, significantly streamlining the debt collection procedures.

It is worth noting that earlier, the Verkhovna Rada also adopted a euro-integration law aimed at harmonizing the accreditation of conformity assessment bodies and the technical regulation system in accordance with European Union standards. These steps reflect Ukraine's commitment to modernizing its legal system and integrating into the European legal space.

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