Enforcement auction (forced sale)

An enforcement auction is the conversion of attached or pledged assets into money through public auction. Sale must be requested by the creditor or debtor within the statutory periods, failing which the attachment lapses.

Auctions are conducted through the national electronic sales portal, with the announcement, bidding window and offer procedure regulated in detail. For the auction to be valid, the bid must cover the statutory fraction of the assessed value together with prior-ranking claims. Debtors may also, under statutory conditions, be authorised to sell the asset themselves instead of the forced sale.

Once the auction becomes final, ownership passes to the buyer and the proceeds are distributed according to the ranking schedule. Auctions attract investors seeking below-market acquisitions, but eviction of occupants, annotations on the title and the risk of annulment are matters buyers should examine before bidding.