Cross-border successions are generally a highly-complex matter. A new EU Succession Regulation will enter into effect on the 17th of August 2015. Its aim is to harmonize the rules of private international law (conflict of laws) within EU countries. The UK, Denmark and Ireland have opted-out from this regulation.
How is cross-border succession currently regulated?
Currently jurisdiction and the applicable law are determined by rules stated in member states’ domestic laws.
The new EU Succession Regulation is applicable only to deaths on or after the 17th of August 2015. So, deaths before the 17th of August 2015 are still covered by existing domestic rules of private international law.
Polish law states that the Polish courts have sole jurisdiction in matters of inheritance of real estate. Polish courts also have jurisdiction when the deceased was a Polish citizen or his last habitual residence was in Poland.
The applicable law is governed by the Polish Private International Law Act. According to it, anyone can choose the applicable law in his will. If he does not, then the applicable law is the law of the state of which he is citizen.
What will change under the new EU Succession Regulation?
It is important to underline that substantive inheritance law or tax aspects will not be changed in any way. This means that it will still be up to the member states to decides on e.g. the order of succession, the amount of legitim, or the amount of inheritance tax.
Under the EU Succession Regulation, there will be only one single criterion for determining which court has jurisdiction and which law is applicable to the case – the last habitual residence of the deceased. As an alternative, if the deceased was manifestly closer connected to another state than to the state of his last habitual residence, then the laws of that state shall be applied.
The changes are revolutionary. No longer criteria such as the location of the deceased’s property or his nationality will be applicable. Both jurisdiction and the applicable law will be determined by the last habitual residence of the deceased.
What is more, the EU Succession Regulation will govern the succession as a whole. This means that jurisdiction and the applicable law will cover the whole estate of the deceased’s from around the world, irrespective of the nature of his assets (movables or real property) and whether they are located in a EU member state or outside the EU.
The deceased will also have a right to choose the applicable inheritance law in his will. However, his choice is restricted to the law of the state of which he is a citizen at the time of drawing up the will or at the time of his death.
How should the last habitual residence be understood?
There is no definition of the last habitual residence in the EU Succession Regulation.
When determining the last habitual residence, courts should assess all factual circumstances of the deceased’s life before his death, such as the duration and regularity of the deceased’s presence in a state. There should be a close and stable connection.
Some difficulties may arise for people who seasonally stay in other states, e.g. have a summer house in a different state, or for who went to study in a foreign state. We can expect that the Court of Justice of the European Union will interpret and refine the term “last habitual residence”.
What is the European Certificate of Succession?
It is a uniform document that will prove someone’s status and rights as a heir effectively in all EU member states (party to the EU Succession Regulation), without the need to obtain a separate certificate for each state.
If one obtains this certificate, one will be able to dispose the entirety of the deceased’s estate in all EU member states without having to engage in lengthy proceedings before each member states’ courts or administrative offices.
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