Generally, national courts in the EU must recognise the judgments of other national courts based across the trading bloc in cross-border civil legal disputes. However, in order for the ruling of a court in one country to be enforced in another, businesses must first obtain a 'declaration of enforceability' from the court in the country they are seeking enforcement in.
The European Commission outlined plans to scrap this requirement, contained in the Brussels Regulation, in legislative proposals published in December 2010. Now the European Parliament has voted overwhelmingly in support of the move.
"Removing bureaucratic obstacles, extra costs and the legal uncertainty of having 27 different and often contradictory systems makes the single market more attractive," EU Justice Commissioner Viviane Reding said in a statement. "This is a very good example of how justice policies can stimulate growth."
"This reform will save time and money for businesses and consumers because judgements from one EU Member State will be automatically recognised in another EU Member State. It is a small revolution for the European area of justice which brings us closer to the model of the U.S. Single Market, where, in the words of the US Constitution, judicial proceedings are given ‘full faith and credit’ in every other state of the union," she added.
The Commission's proposals still require the approval of the EU's Council of Ministers before they are introduced into law. Reding said she was looking forward to the "swift adoption" of the plans before the end of 2012.
The Commission said that the plans will reduce the time it takes businesses to obtain enforcement of national court judgments in other EU member states. Businesses and consumers also stand to save €48 million a year as a result of the abolishment.