On 25 July 2011, the European Commission released the proposed European Account Preservation Order (EAPO) Regulation, which has been submitted for consideration by the European Parliament and the Council of the EU. Whilst it is likely to be several years before the regulation comes into force, it is likely that the infrastructure which will be required in order to administer the regime within the UK will be set up in the near future.
The regime introduces a new and additional kind of bank freezing order which is intended to be available throughout the European Union. The regime, if it is adopted in the UK, will materially change the way banks do business in relation to requests to search and freeze accounts. Given that it is intended to be available in the courts of any EU Member State, it is reasonable to expect increased demands on banks in consequence.
The UK government has until 24 October 2011 to elect whether to opt in to the Regulation. The UK has traditionally opted into all regulations regarding civil justice and absent significant lobbying against the draft regulation, it is likely that the UK will do so here. Herbert Smith held a client seminar on 21 September, at which a panel of leading experts in the area, including the Ministry of Justice, discussed the issues and examined whether the UK should opt in.
For more details see our e-bulletin dated 1 August 2011 available on our website at http://www.herbertsmith.com/NR/rdonlyres/30BB2DC7-F287-4258-AF46-04DBD4B5B362/0/EuropeanAccountPreservationOrder1August2011.htm.