Paraguay’s Chamber of Deputies on Tuesday passed a bill establishing a new mandatory deposit regime for original credit instruments — such as promissory notes and checks — during enforcement proceedings. The law, which now awaits enactment by the Executive Branch, seeks to introduce stricter controls and guarantees in judicial processes related to debt collection.
Under the approved text, the original documents must remain in the custody of the court clerk’s office for the duration of the litigation. This means that when a creditor presents a promissory note or check to sue for payment of a debt, the physical instrument will be deposited with the court until the end of the proceedings.
Deputy Héctor Figueredo, chair of the Industry, Commerce, Tourism and Cooperatives Committee, explained that the goal is to ensure the credit instrument remains clearly identified as the subject of a judicial claim. “The credit instrument must always be held in custody, either through its physical immobilization or another mechanism that allows identifying the fundamental fact that the instrument in question is the subject of a judicial claim,” he said.
The law also allows the creditor to physically keep the document under the status of “judicial depositary.” In such cases, the court will make an official notation on the promissory note or check, recording that it is subject to a judicial proceeding. However, the creditor is obliged to present the document when requested by the court. Non-compliance may constitute breach of deposit, with potential criminal consequences.
Another key point is that the debtor will have the right to recover the original document once the debt is paid off, a provision already in the Civil Code but which faced practical difficulties within the judicial system.
Deputy Jorge Ávalos Mariño, head of the Legislation and Codification Committee, said the bill aims to strengthen traceability and transparency in enforcement proceedings. He also indicated that the law incorporates procedural updates related to the use of digital tools, such as electronic notifications, digital signature verification, and recognition of digital enforcement instruments.
With parliamentary approval, the bill now goes to the Executive Branch for enactment.