Prohibition of Enforcement on the Debtor’s Sole Property – A Novel Provision in the Enforcement and Security Law

The latest amendments to the Law on Enforcement and Security introduce a significant limitation concerning the compulsory collection of claims. The law now stipulates that, as a general rule, enforcement cannot be carried out on immovable property that constitutes the debtor’s sole apartment or house, i.e., the only home where the debtor and members of their household reside.

The purpose of this amendment is to establish a better balance between creditors’ interest in recovering their claims and the need to provide the debtor with a minimum level of existential security. In practice, there have previously been cases where the debtor’s sole property was sold over relatively minor debts, often triggering strong public reactions and raising questions of social justice in the enforcement system.

By introducing this rule, the legislator has set a clear boundary: the debtor’s only home cannot be subject to enforcement, preventing the debtor and their family from losing basic living conditions.

Conditions Under Which the Debtor’s Sole Property Cannot Be Subject to Enforcement

The law does not impose an absolute ban on enforcement against a property but establishes several cumulative conditions that must be fulfilled for the property to be protected. This means that protection applies only if all legally prescribed criteria are met.

Specifically, immovable property used to satisfy the debtor’s housing needs cannot be subject to enforcement if the following conditions are satisfied:

• The property is the only immovable asset owned by the debtor.
• The debtor has been registered as residing at that address for at least five years prior to the filing of the enforcement request, and the address must not have been deactivated.
• The property has a surface area of up to 60 m².
• The principal of the claim for which enforcement is initiated does not exceed half of the property’s market value, as determined in accordance with an act issued by the local self-government authority.
• In the three years prior to the date of submission of the proposal for execution, the debtor has not sold or gifted other immovable property or waived the right to inherit immovable property or concluded a lifetime maintenance contract.

Only if all these conditions are met does the property representing the debtor’s sole home enjoy statutory protection from enforcement. Otherwise, it may be subject to compulsory sale in the enforcement procedure.

Exceptions – When the Property May Still Be Subject to Enforcement

This protection is not absolute. The law provides certain exceptions in which even the debtor’s sole property may be subject to enforcement. These primarily include cases where:

• A mortgage or other security instrument has already been established on the property to secure a claim.
• The debtor has explicitly agreed that the property may serve as collateral for a debt.
• The claim, by its nature, justifies a stronger enforcement measure (for example, certain types of legally protected claims).

In such cases, the protection of the sole home gives way to the principle that the creditor has the right to recover the claim from the asset specifically secured for that purpose.

Practical Implications in Enforcement Proceedings

In practice, this amendment means that creditors will, in many cases, no longer be able to satisfy their claims by selling the debtor’s only apartment or house. This will inevitably lead to more frequent use of alternative enforcement measures, such as:

• Wage garnishment.
• Seizure of funds from bank accounts.
• Enforcement on movable property.
• Enforcement on other debtor assets, if available.

In other words, the property no longer represents the “primary target” for enforcement when the individual has no other immovable property.

Right to a Home and European Standards

The idea of protecting the debtor’s home is not new in the Serbian legal system. The right to respect for the home is enshrined in Article 8 of the European Convention on Human Rights, which safeguards private and family life, home, and correspondence.

Serbia has ratified this Convention, making it an integral part of the constitutional and legal order and directly applicable. This means that even prior to these amendments, there was an obligation to consider proportionality and the protection of fundamental rights in proceedings that could result in the loss of a home.

Therefore, the recent amendments to the Law on Enforcement and Security can be seen as a concretization of the existing right to a home. While this protection previously derived primarily from constitutional and international standards and case law, it now has a clear, explicit form within the law itself.

In this way, the enforcement system in Serbia takes a step toward a model where compulsory collection remains effective, while simultaneously ensuring that it does not lead to the most severe consequence – the loss of the debtor’s sole home.