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Reform for improvement court enforcement proceedings

Reform for improvement court enforcement proceedings
Tuesday, 26 March 2019

As the enforcement proceedings in Uzbekistan proved to be inefficient and protracted, the State takes a decision to improve and simplify the processes in this field. The state body that is responsible for the enforcement proceedings is the Bureau of Mandatory Enforcement under the General Prosecutor’s Office of the Republic of Uzbekistan (the “Bureau”). The growing number of enforcement proceedings and excessive workload of court enforcement officers are the main contributors to the inadequate performance of the Bureau. Taking this into account, the Presidential Decree No. PP – 4236 dated 12.03.2019 “On Measures to Further Improve Effectiveness of Mandatory Execution of Judicial Decisions and Acts of Other Bodies” has been adopted.

The Decree introduces the initiatives that shall alleviate the workload on the enforcement officers and, as a result, accommodate improved performance of the enforcement proceedings. It is aimed at reducing the time required for the procedures and establishing the alternative forms of the enforcement mechanisms and means to resolve the conflict in the form of mediation. Another important measure is the introduction of the Code on Court Enforcement Proceedings that shall bring together all statutory regulations and guarantee their direct effect.           

The Institution of Mediation

The possibility of mediation as a method of conflict resolution at the stage of enforcement proceedings shall be introduced as of April 1, 2019. Such an option shall allow the parties postponing the enforcement proceedings for a period not exceeding 15 (fifteen) days, within which they have a right to come to the consensus as to the terms and conditions of the execution of the judgment. The conclusion of the agreement as the result of the mediation terminates the enforcement proceedings. In all other cases, the postponed enforcement shall continue without the possibility to implement the second round of mediation proceedings. Even though, the commercial mediation relies on the consensual participation of the parties, the mediation agreement is binding and can be enforced, if necessary.

The mediation allows speeding up the execution of the judgment as the debtor who finds mutual understanding with the creditor will discharge his/her duties more willingly. The conclusion of the mediation agreement, in turn, will accelerate the creditor’ satisfying its claim.

The Automation and Digitalization of Processes

Starting from October 1, 2019, the Bureau will introduce the electronic database of enforcement documents. As a result, the administrative orders or other similar documents that have not been performed on a voluntary basis shall be automatically sent to that database in order for such orders to be enforced. The parties shall have a right to be notified through e-mail/SMS that the enforcement proceedings are going to be initiated. 

The Bureau shall also integrate new interactive state services on its official website that will allow monitoring the progress in implementing enforcement proceedings at all stages. In three-month period, the parties shall also have a right to pay state fees, administrative fines and other fees charged during executive proceedings, using electronic payment systems.

With regard to the property that is used to recover debts, the record-keeping system shall be integrated, which allows monitoring the movement of the abovementioned property from the moment it is placed on electronic trading platform «E-IJRO AUKSION» to the moment it is sold. The property acquisition process shall envisage the possibility of the use of other online stores and electronic payment systems, including international ones.

Procedural Changes

Starting from June 1, 2019, several procedural changes shall be made reducing the time required for the enforcement proceedings.

The time needed for the decision commencing the enforcement proceedings to be taken shall be shortened from 3 working days to 1. The debtor/enforcement officer shall have a right to propose postponing the enforcement twice and for the period not exceeding 10 (ten) days upon provision of proofs that impediments exist.[1]

After three-month period, the simplified procedure relating to the imposition of administrative fines shall be introduced. According to that procedure, in case a debtor pays 70% of the adjudicated debt within 15 (fifteen) days, the outstanding 30% amount of the fine is exempted.  Such a simplified procedure shall not be applied if (a) an administrative fine is imposed by a court, (b) an appeal or a protest against the decision on the imposition of an administrative fine is brought or (c) a repeated commission of the same offence occurs within a year.

By that time, it also planned to prepare a draft Code on Court Enforcement Proceedings aimed to bring together all statutory regulations relating to enforcement proceedings.

[1] Until these changes came into force, existing law should require the decisions commencing the enforcement proceedings to be taken within 3 working days and not set a limit on the number of times the enforcement proceedings could be postponed upon debtor`s proposal/ initiative of the state executor.