How is enforcement carried out?

The Financial Agency (Fina) explains in today’s statement that the agency carries out enforcement on monetary assets in bank accounts based on the Law on the Implementation of Enforcement on Monetary Assets and the Enforcement Act, starting from January 1, 2011, and that in the process of enforcement, it does not act arbitrarily and capriciously, but exclusively according to the strictly formal provisions of the mentioned laws.

In a comprehensive statement reacting to frequent articles about the enforcement carried out by Fina, the agency explains that enforcement is carried out in such a way that Fina, based on the received basis for payment, first issues orders to banks to transfer a certain amount from the debtor’s account to the creditor’s account, and only if there are insufficient funds in all accounts, an order for account blocking is issued.

“The claims that Fina blocks accounts without basis and even if the debtor has sufficient funds in the account for the enforcement are untrue,” Fina states, emphasizing that the debtor can freely dispose of money above the amount of the enforcement and that their account is not blocked.

The debtor’s account is blocked only if there are insufficient monetary funds in all their accounts to fulfill the basis for payment. Promptly, immediately after the basis for payment is fully executed, the debtor’s accounts are automatically unblocked, allowing free disposal of monetary assets in the debtor’s accounts, Fina emphasizes.

They also claim that it is absolutely incorrect that no monetary funds can be deposited into blocked accounts, as this would contradict the logic of enforcement. Not only is it allowed and possible to deposit funds into all blocked accounts, but it is also mandatory to deposit into the account if it concerns a legal entity, given that during the blocking period, legal entities are prohibited from making accounting payments and all payments must be received through the account.

Fina explains how it carries out enforcement based on enforcement documents – the basis for payment and emphasizes that the implementation is “completely transparent and the debtor can always obtain all data concerning the enforcement on their accounts from Fina.”

They also remind that accounts opened for receiving monetary funds that are exempt from enforcement by law are always excluded from enforcement.

“In the interest of protecting citizens and their existence, a recent amendment to the subordinate legislation stipulates that the payer of income is obliged to deposit the amount of income exempt from enforcement into a special account even when enforcement is being carried out on wages. In this case, enforcement can only be carried out on a portion of the income, regardless of previously given documents of consent for wage garnishment. Namely, under the Enforcement Act, until the amendments and supplements to the Enforcement Act in 2008, it was possible to certify consent for garnishment of more than one-third, or the entire wage or pension,” Fina emphasizes.

They also remind that debtors are not only citizens but are often citizens in the role of creditors who must attempt to collect their unpaid, hard-earned wages through coercive means, and in this case, citizens also turn to Fina with a request to carry out enforcement on the accounts of the debtor-employer who refuses to pay the wages.

Fina also emphasizes that some writings claiming that it is not possible to block accounts in European countries are incorrect. In all EU countries, enforcement can be carried out on the monetary assets of the debtor in the account, except for funds that are exempt from enforcement (e.g., child allowance, maternity benefits, part of the salary, etc.). In most EU countries, there are special legal or physical entities responsible for carrying out enforcement, and in some European countries, institutions that have a similar role to Fina but with much greater authority in the area of forced debt collection, Fina states.