ECHR: Prolonged failure to enforce court judgments in favour of legal entities constitutes a breach of Article 6 of the Convention

On 16 July 2026, the European Court of Human Rights delivered its judgment in the case of “BANCA SISTEMA S.P.A. v. ITALY”, finding that the Italian authorities’ prolonged failure to enforce court judgments in favour of the applicant company, as well as the impossibility of securing their enforcement through the courts, constituted a violation of Article 6 § 1 of the Convention for the Protection of Human Rights and Fundamental Freedoms (the right to a fair trial) and Article 1 of the First Protocol to the Convention (protection of property).

Case summary

The claimant in the case was the Italian company Banca Sistema S.p.A., which, on a commercial basis, purchases debts owed by public bodies from private enterprises and service providers.

The company acquired claims against the municipality, the amount of which was confirmed by a series of court judgments handed down between 2017 and 2021. The municipality made only a partial repayment of the debt.

On 11 November 2019, the municipality officially declared itself insolvent and initiated the procedure provided for under Decree No. 267 of 18 August 2000 (TUEL). In July 2020, the company applied to the special authority requesting that it be included on the list of the municipality’s creditors. However, under the provisions of the TUEL, the inclusion of claims on such a list simultaneously deprives the creditor of the right to initiate or continue enforcement proceedings in respect of those claims.

The parties’ arguments

The company insisted that the decisions of the national courts, which had been made in its favour, remained unenforced, and that the government’s reference to the municipality’s insolvency proceedings which had only commenced in 2019 could not justify such a prolonged delay.

The Italian Government, for its part, maintained that the delay was objectively due to the need to verify and process claims within the insolvency proceedings, as required by the TUEL, as well as the need to establish the availability of sufficient assets to satisfy the claims of all creditors equally in accordance with the principle of par condicio creditorum. Furthermore, the government argued that, by submitting an application for inclusion on the list of creditors, the company had in effect agreed to the criteria, procedure and timeframes for the settlement of its claims as established by the proceedings.

Legal qualification and the Court’s findings

The ECtHR applied the established principles of its case-law:

• the enforcement of a court judgment forms an integral part of the right to a fair trial under Article 6 § 1 of the Convention;

• an unconditional monetary claim, confirmed by a court judgment and subject to enforcement, constitutes ‘property’ within the meaning of Article 1 of the First Protocol.

  
  

On this basis, the Court found a twofold violation:

• Article 6 § 1 of the Convention — the State failed to ensure effective access to justice, as national legislation deprived the creditor of the possibility of enforcement, and the authorities failed to take the necessary measures to ensure the timely and full enforcement of judgments.

• Article 1 of the First Protocol — the prolonged delay in enforcement constituted a disproportionate interference with the right to peaceful enjoyment of possessions (the monetary claim).

  
  

The European Court of Human Rights unanimously ordered the respondent State to ensure, within three months of the judgment becoming final, that the relevant domestic decisions were enforced; recognised that the finding of a violation in itself constituted sufficient just satisfaction for non-pecuniary damage; and awarded the company 500 euros in compensation for legal costs.

By purchasing distressed debts in the course of its normal commercial activities, the company knowingly took on a commercial risk

At the same time, the Court emphasised that, by purchasing distressed debts in the course of its normal commercial activities, the company knowingly took on a commercial risk, which was one of the grounds for refusing to award compensation for non-pecuniary damage.

Why this is important

The Banca Sistema case is yet another confirmation of a systemic problem relating to the failure to enforce court judgments concerning the debts of local authorities that have become financially insolvent. The ECtHR’s judgment emphasises once again that:

nothing can justify the long-standing failure to enforce final court judgments, nor does it relieve the state of its obligation to guarantee effective access to justice and the protection of creditors’ property rights.

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