Is a Swiss payment order a Judgment under the Lugano Convention? (Case C-697/25 Appenzell)

This post was written by Oliver Lücke, LL.M., who is lawyer in Germany.

The Court of Justice has been asked to clarify a question of considerable practical importance for cross-border enforcement between Switzerland and EU/Lugano Convention states: can a Swiss Zahlungsbefehl (payment order) issued in ordinary, titleless debt enforcement proceedings qualify as a “judgment” within the meaning of Article 32 of the Lugano Convention?

The question arises from a reference by the Austrian Supreme Court in OGH 3 Ob 95/25d. In the Austrian proceedings, a Swiss payment order issued by the Debt Enforcement and Bankruptcy Office of Appenzell was declared enforceable in Austria. The Austrian Supreme Court has referred to the CJEU the question whether such a payment order, issued in the context of titellose Betreibung (debt enforcement without any prior judicial determination of the claim) under Swiss debt enforcement law, may be regarded as a decision of a court for the purposes of Article 32 Lugano Convention.

The Swiss payment order

Under Swiss law, the Zahlungsbefehl is the formal starting point of ordinary debt enforcement proceedings. It is issued by the debt enforcement office on the creditor’s request. At this stage, the office does not examine whether the alleged claim actually exists. Nor does the creditor need to prove the claim. The payment order is therefore not the result of an adjudication of the civil claim. It is, rather, a debt enforcement act that informs the debtor of the claim and enables the debtor to stop the enforcement by lodging an objection, the Rechtsvorschlag.

If the debtor objects, the creditor must take further steps to remove the objection, for example by obtaining definitive or provisional dismissal of the objection or by bringing ordinary proceedings. If the debtor does not object, the creditor may continue the enforcement. But this does not mean that the Zahlungsbefehl has become a civil judgment on the claim. The absence of an objection enables continuation of the enforcement mechanism; it does not transform the payment order into a judicial determination of the underlying obligation.

This distinction is central. The question under Article 32 Lugano Convention is not merely whether a state authority has issued an act that has enforcement consequences. The decisive point is whether that act can properly be characterised as a “judgment” — that is, as a decision which determines, or at least judgment-equivalently establishes, the civil claim.

The temptation of functional comparison

The argument in favour of recognition will likely rely on a functional understanding of the term “court” or “judgment”. European private international law does not always depend on formal institutional labels. Administrative or quasi-judicial authorities may, in certain circumstances, be treated as courts where they perform adjudicative functions. The CJEU’s case law and the Lugano system both support a functional approach to the concept of court-like decision-making. Article 32 Lugano Convention itself defines “judgment” broadly as any judgment given by a court or tribunal of a state bound by the Convention, whatever it may be called.

However, functionalism has limits. It cannot replace the question whether the authority has actually decided the civil claim. A measure may be official, formal, and enforceable in the domestic system, yet still lack the character of a judgment if it is issued without any examination of the claim and without res judicata or judgment-equivalent effects.

Why the Swedish comparison is problematic

A comparison is sometimes drawn with the Swedish payment order procedure before the Kronofogdemyndigheten, the Swedish Enforcement Authority. At first sight, the comparison is attractive. The Swedish procedure also starts before a public enforcement authority. It is designed for monetary claims. The debtor may object. If the debtor does object, the dispute is transferred to a court. The Swedish procedure therefore also combines administrative processing with a possible judicial phase. The European e-Justice Portal describes the Swedish payment order procedure as applying to overdue monetary debts and notes that claims may be handled regardless of the amount involved.

But the crucial difference lies in the legal effect of the Swedish outcome. If the debtor does not object, the Swedish authority issues an utslag. Under Swedish law, once the period for reopening or challenge has expired, an utslag in payment order proceedings acquires legal force in the same way as a final civil judgment. Section 64 of the Swedish Act on Payment Orders and Assistance expressly provides that, after the expiry of the period for återvinning, an utslag in payment order proceedings has res judicata effect corresponding to a final judgment in civil proceedings.

That is not the case with the Swiss Zahlungsbefehl. The Swiss payment order does not decide the underlying claim and does not become a civil judgment merely because the debtor remains passive. Even where enforcement has been completed and the asserted claim has been discharged by a payment made under enforcement pressure, Swiss law allows the debtor, under Article 86 of the Swiss Debt Enforcement and Bankruptcy Act, to bring a restitutionary action within one year of payment if the amount was not actually owed. It may allow enforcement to proceed, but it does not finally determine the substantive claim. This is precisely why the Swedish analogy is potentially misleading. The relevant distinction is not whether the act is issued by a court or by an administrative authority. The relevant distinction is whether the act determines the civil claim in a way that can become final and judgment-equivalent. The Swedish utslag may do so; the Swiss Zahlungsbefehl does not.

Article 32 Lugano Convention and the limits of enforcement formalism

The pending reference therefore raises a broader question about the architecture of the Lugano Convention. The Convention facilitates the recognition and enforcement of judgments. It does not necessarily require a traditional court structure, but it does require a decision capable of recognition as a judgment. If every domestic enforcement act that permits further enforcement were treated as a judgment, the boundary between debt enforcement measures and adjudicative decisions would become blurred.

This is particularly sensitive in the Swiss context. Swiss debt enforcement law deliberately separates the issuance of a payment order from any adjudication of the claim. The payment order is procedurally important, but it is not the point at which the existence of the debt is determined. That determination, if disputed, occurs elsewhere: in dismissal-of-objection proceedings, in ordinary civil litigation, or in other title-producing proceedings.

Treating the Zahlungsbefehl itself as a Lugano judgment would therefore give it an international effect that Swiss law does not attribute to it domestically. It would risk elevating a non-adjudicative enforcement step into a cross-border judgment.

Conclusion

The CJEU should resist an overly broad reading of Article 32 Lugano Convention. A Swiss Zahlungsbefehl issued in debt enforcement without any prior judicial determination of the claim is not a judgment merely because it is issued by a state authority and may lead to enforcement if uncontested. It is not the result of adjudication, it does not determine the civil claim, and it does not become judgment-equivalent through debtor passivity.

The better approach is to distinguish the Swiss payment order from payment order systems that culminate in a final, res judicata decision. The Swedish model illustrates precisely that distinction. It does not support automatic assimilation. On the contrary, it shows why the Swiss Zahlungsbefehl should be treated with caution under Article 32 Lugano Convention.

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The author of this post has treated more extensively this topic in several articles written in German: Oliver Lücke, Problemfelder der Anerkennung von bestimmten schweizerischen Entscheidungen nach Schuldbetreibung und ZPO gemäss Lugano-Übereinkommen, ZfRV 2022, 71–92; Oliver Lücke, Der schweizerische Zahlungsbefehl als “verfahrenseinleitendes Schriftstück” gem. Art. 34 Nr. 2 Lugano-Übereinkommen?, WM 2024, 45–55.