Droit international général

In Boettcher v Xio (UK) LLP & Ors [2023] EWHC 801 (Comm)  Eggers DJ ultimately rejected ia a forum non conveniens challenge viz a claim for damages for misrepresentations allegedly made to induce claimant to enter into a contract of employment with the First Defendant. In his decision he considered ia the role to play for the application of the (retained) Rome II Regulation.

[109] There was substantial dispute between the parties as to whether the applicable law was English law in accordance with A12(1) Rome II (culpa in contrahendo), alternatively A4(1) Rome II  (on claimant’s case), or German law in accordance with A(1) (on defendants’ case).

[110] The judge holds there is a good arguable case (with final judgment on lex causae to be discussed at trial [110](4)) that English law is the applicable law, however I do not find his arguments very convincing. [110](1)

the damages claimed by Dr Boettcher for the alleged misrepresentations arose as a result of his entering into the contract of employment with Xio UK, in particular his claims for loss of earnings and damages for mental distress and/or disappointment and/or reputational damage. It was therefore his entry into the contract of employment with Xio UK, and his subsequent employment with Xio UK, in reliance on the alleged misrepresentations which constituted the relevant damage.

This, I would suggest, is plainly wrong. The alleged misrepresentations are the delictus committi; the formation of the contract (held with reference to Dicey 35-026 to have taken place in England) is the fallout of the delict. Yet it does not constitute its ‘direct damage’. The damage, as also seemingly formulated in the claim, are loss of earnings and damages for mental distress and/or disappointment and/or reputational damage. Seeing as claimant’s earlier employment for which he left currently litigated one, was overwhelmingly connected to Germany, where he also seems to have the core of his financial interests (the location of claimant’s bank account is too readily dismissed [110](2) as not being relevant), Germany would seem to have a lot going for it in terms of the lex causae, or at the very least a Mozaik of German (for loss of earnings) and English law (for mental distress), which I do not see readily displaced by English law as one applicable law under Article 4(3) Rome II.

Article 12’s culpa in contrahendo rule is correctly held [110](3) not to apply to relevant parties.

There are other factors that led to the forum non challenge not succeeding, however I do indeed think that the applicable law issue requires further consideration at trial.

Geert.

Failed jurisdictional challenge ia on forum non conveniens grounds, with consideration ia of Rome II applicable law

Boettcher v (Xio (UK) LLP & Ors [2023] EWHC 801 (Comm)https://t.co/dE6jE9mJfV

— Geert Van Calster (@GAVClaw) May 3, 2023

Registration is open for the 9th Journal of Private International Law Conference.

The conference will be held on 3 to 5 August 2023 at the Yong Pung How School of Law at the Singapore Management University. The keynote address will be delivered by Philip Jeyaretnam, President of the Singapore International Commercial Court.

The deadline for speakers to register is 30 May 2023. The deadline for other registrants is 25 June 2023.

Registration is complimentary for speakers, Journal of Private International Law editorial board members and SMU faculty, staff and students. Preferential rates apply for academics, government officials, SMU alumni and non-SMU students – register with your institutional e-mail to enjoy the preferential rate.

More information, including the draft programme and link to register, can be found here.

In a recent decision, the Dubai Supreme Court (DSC) confirmed that enforcing foreign judgments in the Emirate could be particularly challenging. In this case, the DSC ruled against the enforcement of an English judgment on the ground that the case had already been decided by Dubai courts by a judgment that became final and conclusive (DSC, Appeal No. 419/2023 of 17 May 2023). The case presents many peculiarities and deserves a closer look as it reinforces the general sentiment that enforcing foreign judgments – especially those rendered in non-treaty jurisdictions – is fraught with many challenges that render the enforcement process very long … and uncertain. One needs also to consider whether some of the recent legal developments are likely to have an impact on the enforcement practice in Dubai and the UAE in general.

The case

 1) Facts 

The case’s underlying facts show that a dispute arose out of a contractual relationship concerning the investment and subscription of shares in the purchase of a site located in London for development and resale. The original English decision shows that the parties were, on the one hand, two Saudi nationals (defendants in the UAE proceedings; hereinafter, “Y1 and 2”), and, on the other hand, six companies incorporated in Saudi Arabia, Anguilla, and England (plaintiffs in the UAE proceedings, hereinafter “X et al.”). The English decision also indicates that it was Y1 and 2 who brought the action against X et al. but lost the case. According to the Emirati records, in 2013, X et al. were successful in obtaining (1) a judgment from the English High Court ordering Y1 and 2 to pay a certain amount of money, including interests and litigation costs, and, in 2015, (2) an order from the same court ordering the payment of the some additional accumulated interests (hereinafter collectively “English judgment”). In 2017, X et al. sought the enforcement of the English judgment in Dubai.

2) The Enforcement Odyssey…

a) First Failed Attempt

i) Dubai Court of First Instance (DCFI)

First, X et al. brought an action to enforce the English judgment before the DCFI in accordance with the applicable rules in force at the time of the action (former art. 235 of the 1992 Federal Civil Procedure Act [“1992 FCPA”]). Based on well-established case law, the DCFI rules as follows: (i) in the absence of an applicable treaty, reciprocity should be established (interestingly, in casu, the DCFI considered that the UAE-UK bilateral convention on judicial assistance could not serve as a basis for enforcement since it lacked provisions on mutual recognition and enforcement); (ii) reciprocity can be established by showing that the enforcement requirements in the rendering State are “the same (identical) or less restrictive” compared to those found in the UAE; (iii) it was incumbent on the party seeking enforcement to submit proof of the content of the foreign law pursuant to the methods of proof admitted in the UAE so that the court addressed could compare the enforcement requirements in both countries. Considering that X et al. had failed to establish reciprocity with the United Kingdom (UK), the DCFI refused the enforcement of the English judgment (DCFI, Case No. 574/2017 of 28 November 2017).

X et al. appealed to the Dubai Court of Appeal.

ii) Dubai Court of Appeal (DCA)

Before the DCA, X et al. sought to establish reciprocity with the UK by submitting evidence on the procedural rules applicable in England. However, the DCA dismissed the appeal on the ground that the English court did not have jurisdiction. The DCA started first by confirming a longstanding position of Dubai courts, according to which the foreign court’s jurisdiction should be denied if it is established that the UAE courts had international jurisdiction, even when the jurisdiction of the rendering court could be justified based on its own rules; and that any agreement to the contrary should be declared null and void. Applying these principles to the case, the DCA found that Y1 and 2 were domiciled in Dubai. Therefore, since the international jurisdiction of Dubai courts was established, the DCA found that the English court lacked indirect jurisdiction (DCA, Appeal No. 10/2018 of 27 November 2018).

Dissatisfied with the result, X et al. appealed to the Supreme Court.

iii) Dubai Supreme Court (DSC)

Before the DSC, X et al. argued that English courts had jurisdiction since the contractual relationship originated in England; the case concerned contracts entered into and performed in England; the parties had agreed on the exclusive jurisdiction of English court and that it was Y1 and 2 who initially brought the action against them in England. However, the DSC, particularly insensitive to the arguments put forward by X et al., reiterated its longstanding position that the rendering court’s indirect jurisdiction would be denied whenever the direct jurisdiction of UAE courts could be justified on any ground admitted under UAE law (DSC, Appeal No. 52/2019 of 18 April 2019).

b) Second Failed Attempt

The disappointing outcome of the case did not discourage X et al. from trying their luck again, knowing that the enforcement regime had since been (slightly) amended. Indeed, in 2018, the applicable rules – originally found in the 1992 FCPA – were moved to the 2018 Executive Regulation No. 57 of the 1992 FCPA (as subsequently amended notably by the 2021 Cabinet Decision No. 75. Later, the enforcement rules were reintroduced in the new FCPA enacted in 2022 and entered into effect in January 2023 [“2022 FCPA”]). The new rules did not fundamentally modify the existing enforcement regime but introduced two important changes.

The first concerns the enforcement procedure. According to old rules (former Art. 235 of the 1992 FCPA), the party seeking to enforce a foreign judgment needed to bring an ordinary action before the DCFI.  This procedure was replaced by a more expeditious one consisting in filing a petition for an “order on motion” to the newly created Execution Court (Art. 85(2) of the 2018 Executive Regulation, now the new Art. 222(2) of the 2022 FCPA).

The second concerns indirect jurisdiction. According to the old rules (former Art. 235 of the 1992 FCPA), the enforcement of a foreign judgment should be denied if (1) UAE courts had international jurisdiction over the dispute; and (2) the rendering court did not have jurisdiction according to (a) its own rules of international jurisdiction and (b) its rules on domestic/internal jurisdiction. Now, Art. 85(2)(a) of the 2018 Executive Regulation (new Art. 222(2)(a) of the 2022 FCPA) explicitly provides that the enforcement of the foreign judgment will be refused if the UAE courts have “exclusive” jurisdiction.

Based on these new rules, X et al. applied in 2022 to the Execution Court for an order to enforce the English judgment, but the application was rejected. X et al. appealed before the DCA. However, unexpectedly, the DCA ruled in their favour and declared the English judgment enforceable. Eventually, Y1 and 2 appealed to DSC. They argued, inter alia, that X et al. had already brought an enforcement action that was dismissed by a judgment that is no longer subject to any form of appeal. The DSC agreed. It considered that X et al. had already brought the same action against the same parties and having the same object and that the said action was dismissed by an irrevocable judgment. Therefore, X et al. should be prevented from bringing a new action, the purpose of which was the re-examination of what had already been decided (DSC, Appeal No. 419/2023 of 17 May 2023).

Comments

1) The case is interesting in many regards. First, it demonstrates the difficulty of enforcing foreign judgments in the UAE in general and Dubai in particular. Indeed, UAE courts (notably Dubai courts) have often refused to enforce foreign judgments, in particular those rendered in non-treaty jurisdictions, based on the following grounds:

i) Reciprocity (see, e.g., DSC, Appeal No. 269/2005 of 26 February 2006 [English judgment]; DSC, Appeal No. 92/2015 of 9 July 2015 [Dutch judgment (custody)]; DSC, Appeal No. 279/2015 of 25 February 2016 [English judgment (dissolution of marriage)]; DSC, Appeal No. 517/2015 of 28 August 2016 [US. Californian judgment]);

ii) Indirect jurisdiction (see, e.g., DSC, Appeal No. 114/1993 of 26 September 1993 [Hong Kong judgment]; DSC, Appeal No. 240/2017 of 27 July 2017 [Congo judgment]); and

iii) Public policy, especially in the field of family law, and usually based on the incompatibility of the foreign judgment with Sharia principles (see, e.g., DSC, Appeal No. 131/2020 of 13 August 2020 [English judgment ordering the distribution of matrimonial property based on the principle of community of property]. See also, Federal Supreme Court, Appeal No. 193/24 of 10 April 2004 [English judgment conferring the custody of a Muslim child to a non-Muslim mother]; Abu Dhabi Supreme Court, Appeal No. 764/2011 of 14 December 2011 [English judgment order the payment of life maintenance after divorce]). Outside the field of family law, the issue of public policy was raised in particular with respect to the consistency of interests with Sharia principles, especially in the context of arbitration (see, e.g., DSC, Appeal No. 132/2012 of 18 September 2012 finding that compound and simple interests awarded by an LCIA arbitral award did not violate Sharia. But, c.f. Federal Supreme Court, Appeal No. 57/24 of 21 March 2006, allowing the payment of simple interests only, but not compound interests.).

Second, the case shows that the enforcement process in the UAE, in general, and in Dubai, in particular, is challenging, and the outcome is unpredictable. This can be confirmed by comparing this case with some other similar cases. For example, in one case, the party seeking enforcement (hereinafter “X”) unsuccessfully sought the enforcement of an American (Nevada) judgment against the judgment debtor (hereinafter “Y”). The DCFI first refused to enforce the American judgment for lack of jurisdiction (Y’s domicile was in Dubai). The decision was confirmed on appeal, but on the ground that X failed to establish reciprocity. Instead of appealing to the DSC, X decided to bring a new action on the merits based on the foreign judgment. The lower courts (DCFI and DCA) dismissed the action on the ground that it was, in fact, an action for the enforcement of a foreign judgment that had already been rejected by an irrevocable judgment. However, DSC quashed the appealed decision with remand, considering that the object of the two actions was different. Insisting on its position, the DCA (as a court of remand) dismissed the action again. However, on a second appeal, the DSC overturned the contested decision, holding that the foreign judgment was sufficient proof of the existence of Y’s debt. The DSC finally ordered Y to pay the full amount indicated in the foreign judgment with interests (DSC, Appeal No. 125/2017 of 27 April 2017).

However, such an approach is not always easy to pursue, as another case concerning the enforcement of a Singaporean judgment clearly shows. In this case, X (judgment creditor) applied for an enforcement order of a Singaporean judgment. The judgment was rendered in X’s favour in a counterclaim to an action brought in Singapore by Y (the judgment debtor). The Execution Court, however, refused to issue the enforcement order on the ground that there was no treaty between Singapore and the UAE. Instead of filing an appeal, X brought a new action on the merits before the DCFI, using the Singaporean judgment as evidence. Not without surprise, DCFI dismissed the action accepting Y’s argument that the case had already been decided by a competent court in Singapore and, therefore, the foreign judgment was conclusive (DCFI, Case No. 968/2020 of 7 April 2021). Steadfastly determined to obtain satisfaction, X filed a new petition to enforce the Singaporean judgment before the Execution Court, which – this time – was accepted and later upheld on appeal. Y decided to appeal to the DSC. Before the DSC, Y changed strategy and argued that the enforcement of the Singaporean judgment should be refused on the ground that the rendering foreign court lacked jurisdiction! According to Y, Dubai courts had “exclusive” jurisdiction over the subject matter of X’s counterclaim because its domicile (place of business) was in Dubai. However, the DSC rejected this argument and ruled in favour of the enforcement of the Singaporean judgment (DSC, Appeal No. 415/2021 of 30 December 2021).

2) From a different perspective, one would wonder whether the recent developments observed in the UAE could alleviate the rigor of the existing practice. These developments concern, in particular, (i) the standard based on which the jurisdiction of the foreign should be examined and (ii) reciprocity.

(i) Regarding the jurisdiction of the foreign court, the new article 222(2)(a) of the 2022 FCPA (which reproduces the formulation of article 85(2)(a) of the 2018 Executive Regulation introduced in 2018) explicitly states that foreign judgments should be refused enforcement if UAE courts “have exclusive jurisdiction over the dispute in which the foreign judgment was rendered” (emphasis added). The new wording suggests that the foreign court’s indirect jurisdiction would be denied only if UAE courts claim “exclusive” jurisdiction over the dispute. Whether this change would have any impact on the enforcement practice remains to be seen. But one can be quite sceptical since, traditionally, UAE law ignores the distinction between “exclusive” and “concurrent” jurisdiction. In addition, UAE courts have traditionally considered the jurisdiction conferred to them as “mandatory”, thus rendering virtually all grounds of international jurisdiction “exclusive” in nature. (See, e.g., the decision of the Abu Dhabi Supreme Court, Appeal No. 71/2019 of 15 April 2019, in which the Court interpreted the word “exclusive” in a traditional fashion and rejected the recognition of a foreign judgment despite the fact that the rendering court’s jurisdiction was justified based on the treaty applicable to the case. But see contra. DCFI, Case No. 968/2020 of 7 April 2021 op. cit. which announces that a change can be expected in the future).

(ii) Regarding reciprocity, it has been widely reported that on 13 September 2022, the UAE Ministry of Justice (MOJ) sent a letter to Dubai Courts (i.e. the department responsible for the judiciary in the Emirate of Dubai) concerning the application of the reciprocity rule. According to this letter, the MOJ considered that reciprocity with the UK could be admitted since English courts had accepted to enforce UAE judgments (de facto reciprocity). Although this letter – which lacks legal force – has been widely hailed as announcing a turning point for the enforcement of foreign judgments in general and English judgments in particular, its practical values remain to be seen. Indeed, one should not lose sight that, according to the traditional position of Dubai courts, reciprocity can be established if the party seeking enforcement shows that the rendering State’s enforcement rules are identical to those found in the UAE or less restrictive (see DSC, Appeal No. 517/2015 of 28 August 2016, op. cit.). For this, the party seeking enforcement needs to prove the content of the rendering Stat’s law on the enforcement of foreign judgments so that the court can compare the enforcement requirement in the state of origin and in the UAE. Dubai courts usually require the submission of a complete copy of the foreign provisions applicable in the State of origin duly certified and authenticated. The submission of expert opinions (e.g., King’s Counsel opinion) or other documents showing that the enforcement of UAE judgments is possible was considered insufficient to establish reciprocity (see DSC, Appeal No. 269/2005 of 26 February 2006, op. cit.). The fact that the courts of the rendering State accepted to enforce a UAE judgment does not seem to be relevant as the courts usually do not mention it as a possible way to establish reciprocity. Future developments will show whether Dubai courts will admit de facto reciprocity and under which conditions.

Finally, the complexity of the enforcement of foreign judgments in Dubai has led to the emergence of an original practice whereby foreign judgment holders are tempted to commence enforcement proceedings before the DIFC (Dubai International Financial Center) courts (AKA Dubai offshore courts) and then proceed with the execution of that judgment in Dubai (AKA onshore courts). However, this is a different aspect of the problem of enforcing foreign judgments in Dubai, which needs to be addressed in a separate post or paper. (On this issue, see, e.g., Harris Bor, “Conduit Enforcement”, in Rupert Reed & Tom Montagu-Smith, DIFC Courts Practice (Edward Elgar, 2020), pp. 30 ff; Joseph Chedrawe, “Enforcing Foreign Judgments in the UAE: The Uncertain Future of the DIFC Courts as a Conduit Jurisdiction”, Dispute Resolution International, Vol. 11(2), 2017, pp. 133 ff.)

In FX Claims v Natwest Markets ECLI:NL:RBAMS:2023:1789, the first instance court at Amsterdam has rejected jurisdiction against the non-Dutch incorporated defendants (from the UK, the US, and Switserland) in a follow-on cartel damages case triggered by the European Commission’s decisions re manipulation of Forex Trading (known as Three Way Banana Split, Essex Express, and Sterling Lads, after the chatrooms in which the rigging was organised).

Stichting FX Claims was established by the US law firm that acts as third party litigation funder.

[6.3] the jurisdictional analysis takes place under Brussels IA for the Dutch-incorporated anchor defendant, Lugano II (referred to by the court as EVEXII) for the Swiss-incorporated defendant, and residual Dutch rules for all the others. However other than for the anchor defendant, the test is always the same (Dutch residual PIL instructs (see the Dutch Supreme Court in ‘Moldavia’) the courts to assess the claims using EU rules and CJEU authority): whether the claims against all defendants are so closely connected so that the sound administration of justice suggests it is expedient to hear them together, unless the claim is solely brought for the purpose of taking the defendant concerned away from their natural, domicile jurisdiction. Claimant resorts ia to the economic unit theory from EU competition law (see eg CJEU ENI) to support its anchoring unto a Dutch corporate vehicle of Natwest.

However [6.19] the Dutch Natwest SPV at the time of the infringements was not a direct daughter of the Natwest vehicle to whom the EC Decisions were addressed, and the claimant’s attention to the anchor defendant’s activities in their claim, is far underdeveloped [6.20]. With both the legal and the factual circumstances of anchor defndant being so radically different to those of the other defendants, the court finds [6.23] that the claims against it or not ‘closely related’ let alone so closely related so as to trigger expediency of joinder.

[6.31] Claimant’s argument that the cartelists’ activities concerned the whole of the EEA, including The Netherlands, is found not to suffice to identify Handlungsort (locus delicti commissi) in The Netherlands, neither [6.36] to locate locus damni Erfolgort in The Netherlands (here the court referred to CJEU CDC, flyLAL, and Volvo Trucks: damage needs to be shown for each individual claimant) other than for 3 of the parties represented in the claim, who have their corporate domicile in The Netherlands.

[6.37] a call upon the effet utile of the Damages Directive 2014/104 is rejected for that Directive is held not to include jurisdictional rules.

Finally the Stichting [6.43] attempts to establish jurisdiction under the Dutch forum necessitatis rule, referring to the practical challenges in suing outside the EU, the impossibility for non-EU, including UK courts to refer if need be to the CJEU (compare, in subsidiary fashion, Butcher J in Mercedez-Benz), the high costs involved in claiming in the UK, and, again, the effet utile of the Damages Directive. None of these impress the court which, referring to the need to apply forum necessitatis strictly, referring to there not being a serious suggestion that no fair trial will be guaranteed in the UK, and to the absence in EU statutory law or CJEU authority of a rule that EU competition law claims ought to always be judged by a court in the EU.

The judgment illustrates that much as the anchor defendant mechanism offers interesting opportunities, it cannot be used opportunistically.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.13.1.

1st instance Amsterdam rejects jurisdiction viz most defendants in financial services follow-on cartel damages claim
Claims v anchor defendant found not to be 'related'
Handlungsort, Erfolgort not in NL
No forum necessitatis

FX Claims v Natwest Markets eahttps://t.co/9dwpjVnRzG

— Geert Van Calster (@GAVClaw) April 19, 2023

Just late yesterday, Uniform Law Review  published an interesting article that is of significance and relevance to comparative law and conflict of laws. It is titled EE Clotilde, “The reception of OHADA Law in anglophone Cameroon: appraisals and proposals” The abstract reads as follows:

This article assesses the extent to which the law under the Organisation pour l’Harmonisation en Afrique du Droit des Affaires (OHADA) has been received in anglophone Cameroon after 26 years of existence, with specific focus on the Fako judicial division.1 With regard to the tenets of qualitative research, it is observed that, from the viewpoint of the legal reception technique, it is indisputable that OHADA law has been infused into the English-speaking legal system in Cameroon through legal techniques of transposition. Through the use of interviews and questionnaires as our research tools, it is revealed that this reception remains limited because most judicial actors still find it difficult to implement legislation that they have not yet mastered. Linguistic issues and the difficulties faced in accessing the Common Court of Justice and Arbitration based in Ivory Coast in Abidjan on OHADA-related matters are serious obstacles to its effective implementation. This situation has been worsened by the poor articulation of clichés that tend to radically oppose OHADA law compared to common law principles. This article tries to deconstruct the ideas received as it shows some of the similarities in the substantive law under the two systems and consequently advocates on this basis the idea that efforts be made to familiarize common law jurists with the content of OHADA law. The article recommends that linguistic issues be tackled by OHADA lawmakers right from the stage of legal drafting by using drafting techniques that will reduce the feeling that the common law is being neglected. For uniform acts yet to be translated, the translation process should associate experts in comparative law to enable the use of appropriate legal language in translation from French into English. Only such efforts will entice the common law African countries that are still hesitating to join OHADA law and, by so doing, will render investment in Africa more attractive.

In Mercedes-Benz Group AG & Anor v Continental Teves UK Ltd & Ors [2023] EWHC 1143 (Comm)  Butcher J set aside permission for service out of the jurisdiction (against EU-incorporated defendants) in a follow-on damages claim following the European Commission’s Hydraulic Braking system cartel findings.

The UK parties are the anchor defendants. Pre-Brexit, the case against the non-UK defendants would have been brought under A8(1) Brussels Ia and the abuse threshold per CJEU CDC would have undoubtedly not been met.

The attractive UK discovery rules were mentioned by claimants as an important reason to anchor the case in the UK. On that point [25] the judge held per Spiliada‘s instruction [as a general rule, the court will not be deterred from granting a stay or refusing permission to serve out simply because the claimant will be deprived of a ‘legitimate personal or juridical advantage’, such as damages on a higher scale or a more generous disclosure regime, unless it is shown through cogent evidence that there is a risk that substantial justice will not be done in the natural forum] that substantial justice could not be done in Germany, if it was an available forum.

Butcher J overall [26] held that Germany is an available forum (in the case of the German defendants by reason of both A4 and A7(2) [locus delicti commissi] Brussels Ia, and in the case of the UK defendant by reason of the German forum connexitatis rules), with which the dispute has its closest and most real connexion, and which may be described as the natural forum for the present dispute.

The nature of the infringing conduct, causation and damage all overwhelmingly took place in Germany, witnesses largely have German as their mother tongue. [51] counsel for claimants makes an interesting point that matters of convenience ought not to weigh in favour of cartelists (essentially a nemo auditur application), however, the judge holds that ‘in relation to the matters which will be in issue, there has been no finding that Mercedes are right, or the Defendants wrong.

Further and importantly [albeit only as an additional argument: [57]: ‘I should state, however, that I do not regard this factor as decisive. My conclusion on the natural forum would have been the same without it’], [56] the judge with respect to applicable law points to the disadvantage of England and Wales given the impossibility to refer to the CJEU

While the courts of England and Wales are obviously very used to applying EU law, and until recently did so as being directly applicable, it is the case that since the UK’s withdrawal from the EU, UK courts cannot make preliminary references to the CJEU in respect of questions of the interpretation of EU law. While the Claimants say that a reference to the CJEU in respect of the interpretation of a Settlement Decision would be unusual, it cannot be said to be unprecedented.

Conclusion [58]

I am of the clear view that the forum with which the dispute has its closest and most real connexion is Germany, which is the natural forum for the dispute. The case has, in reality, very limited connexions with England and Wales, and it is not one, unlike very many which come before this court, where the parties have consensually chosen England and Wales as the forum for their disputes. The case has, by contrast, strong (and certainly much stronger) connexions with Germany.

Geert.

Jurisdiction refused
Follow on claim for damages viz EC Hydraulic Braking Systems cartel decision
Held forum non conveniens points to Germany

(pre Brexit jurisdiction would have been beyond doubt)

Mercedes-Benz v Continental Teves [2023] EWHC 1143 (Comm)https://t.co/e520HgxtvZ

— Geert Van Calster (@GAVClaw) May 16, 2023

On Tuesday, June 6, 2023, the Hamburg Max Planck Institute will host its 34th monthly virtual workshop Current Research in Private International Law at 11:00-12:30 CEST. Holger Spamann  (Havard Law School) will speak, in English, about the topic

Law Matters – Less Than We Thought. Or: Do Judges Actually Follow Conflict of Law Directives

About the topic:
We conduct a randomized lab experiment with U.S. federal judges. The experiment puts the judges in the shoes of a judge deciding the applicable state law in a civil traffic accident case, which will determine whether a damage cap applies. We randomize the forum (with its choice of law directive) and the location of the accident in one state and the parties’ common domicile in another state.
One forum applies the traditional lex loci delicti rule, which calls for the application of the law of the state where the accident happened. The other forum applies the Restatement 2nd’s “most significant relationship” standard, which in our case calls for application of the law of common domicile. Judges’ decisions reflect this variation, but barely so. The data suggest that they tend to have a preference for lex loci delicti, and against damages caps. By contrast, we do not find that they are biased towards the more sympathetic party, which had been a third experimental treatment in our study.

The presentation will be followed by open discussion. All are welcome. More information and sign-up here.

If you want to be invited to these events in the future, please write to veranstaltungen@mpipriv.de.

A Summer School on Cross-border litigation and international arbitration will take place between 17 and 22 July 2023 both on-site at the Ravenna Campus of the University of Bologna and on-line, under the direction of Michele Angelo Lupoi (University of Bologna) and Marco Farina (LUISS, Rome).

The course will address a broad range of issues relating to transnational litigation, as they arise in contexts as diverse as climate change litigation, commercial and maritime litigation, and family and succession disputes. International arbitration will also be covered.

The lecturers include Apostolos Anthimos, Giovanni Chiapponi, Elena D’Alessandro, David Estrin, Francesca Ferrari, Chris Helmer, Albert Henke, Emma Roberts, Marco Torsello, Stefano Alberto Villata, and Anna Wysocka-Bar.

The Summer School is aimed at law students as well as law graduates and practitioners.

Registrations are open until 6 July 2023. Further information are found here.

Hanoch Dagan (Tel Aviv University) and Sagi Peari (University of Western Australia) have posted on Choice of Law Meets Private Law Theory on SSRN.

Choice of law can, and often should, be an important feature of an autonomy-enhancing law as it expands the possible frameworks within which people can govern their affairs. The theory of choice of law we develop in this article builds on three core notions that dominate existing doctrine — states, party autonomy, and what we loosely refer to as ‘limitations’; but it releases choice of law from its subordination to private international law (or its inter-state equivalent in federal contexts). As a freestanding concept, choice of law belongs to private law’s empowering sections and thus participates in the obligation of liberal states to proactively promote people’s self-determination. This foundation of the field refines its three fundamental notions in a way that facilitates their peaceable cohabitation. It also recalibrates the boundaries of choice of law doctrine, clarifies its prescriptions, and offers grounds for its reform.

The paper is forthcoming in the Oxford Journal of Legal Studies.

To celebrate the 30th anniversary of the 1993 Adoption Convention, the Permanent Bureau of the HCCH will be hosting an online event on Wednesday, 31 May 2023, from 14:00 to 18:00 CEST.

The event will feature two round tables, one on “Learning from the Past” and one on “Looking to the Future”, composed of adoption experts from across the world. It will also feature a panel composed by a birth mother, an adoptive mother, and adopted persons, who will discuss their lived experiences.

During the event, panellists will present their views and will respond to selected questions sent in advance of the event.

To register, please visit: https://bit.ly/40Dnptk

For more information, please visit: https://bit.ly/3H8IV2j

I reported earlier on the jurisdictional issues in a case where PIFSS brings claims for sums totalling in the region of US$874 million, arising from the alleged corruption between 1994 and 2014 of its former Director General. In The Public Institution for Social Security v Al Wazzan & Ors [2023] EWHC 1065 (Comm), Henshaw J held early May that documents held in Switzerland must be disclosed, in application of disclosure rules under English civil procedure.

The disclosure concerns a large file of documents held by the Swiss Federal Prosecutor’s Office (SFPO)  arising from its investigations of Mr Al Rajaan and Ms Al Wazzan (Mr Al Rajaan’s widow) since 2012, and other documents held by Swiss-based entities or individuals, or located in Switzerland, or originating from and obtained under compulsion in Switzerland.

Disclosure was ordered, with a small caveat [161] which will see future specific measures (eg restriction of disclosure to counsel) be taken to ensure disclosure of the SFPO file documents to PIFSS does not create a risk of transmission to the State of Kuwait, which in turn might be viewed as sidestepping the State of Kuwait’s pending Mutual Legal Assistance (MLA) request to Switserland for the purpose of the continuing criminal proceedings in Kuwait.

Justice Henshaw’s lengthy considerations do justice to two restraints on disclosure, under English CPR for use in English proceedings. The principal approach is [43 ff; and [47] in particular with reference to Bank Mellat v HM Treasury [2019] EWCA Civ 449] that questions of disclosure and inspection are part of the law of procedure and are therefore matters of English law as the lex fori ; duties of confidentiality (which, if breached, may result in sanction) arising under foreign law do not provide an automatic basis to withhold disclosure and inspection. They are a matter for the judge’s discretion, and disclosure is only not ordered where the party shows that the foreign law is regularly enforced, so that the risk of prosecution is real.

[51] the judge holds that comity considerations are an independent element to consider, and in the process refers to its neat definition in Dicey’s 16th ed § 7-002:

“The United [States] Supreme Court famously said in Hilton v Guyot, a case on the recognition of foreign judgments: “‘Comity,’ in the legal sense, is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive, or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens or of other persons who are under the protection of its laws.”

An interesting judgment raising several relevant issues (including one side-issue on the tardiness of the Hague Taking of Evidence rules).

Geert.

Following part successful jurisdiction challenge ( https://t.co/wncyM6RxZ1) now issues of disclosure under English CPR of Swiss-held documents

Lex fori rules for procedure, but with assessment of prosecution risk under lex rei sitae (SW), and of comityhttps://t.co/UR87IVj4AE

— Geert Van Calster (@GAVClaw) May 9, 2023

Carlos Santaló Goris, Lecturer at the European Institute of Public Administration in Luxembourg, offers an analysis of an upcoming legislative reform in Montenegro concerning the European Account Preservation Order

In 2010, Montenegro formally became a candidate country to join the European Union. To reach that objective, Montenegro has been adopting several reforms to incorporate within its national legal system the acquis communautaire. These legislative reforms have also addressed civil judicial cooperation on civil matters within the EU. The Montenegrin Code of Civil Procedure (Zakon o parni?nom postupku) now includes specific provisions on the 2007 Service Regulation, the 2001 Evidence Regulation, the European Payment Order (‘EPO’), and the European Small Claims Procedure (‘ESCP’). Furthermore, the Act on Enforcement and Securing of Claims (Zakon o izvršenju I obezbe?enju) also contains provisions on the EPO, the ESCP, and the European Enforcement Order (‘EEO’). While none of the referred EU instruments require formal transposition into national law, the fact that it is now embedded within national legislation can facilitate its application and understanding in the context of the national civil procedural system.

Currently, the Montenegrin legislator is about to approve another amendment of the Act on Enforcement and Securing of Claims, this time concerning the European Account Preservation Order Regulation (‘EAPO Regulation’). This instrument, which entered into force in 2017, allows the provisional attachment of debtors’ bank accounts in cross-border civil and commercial claims. It also allows creditors  with a title at the time of application to apply for an EAPO. According to the Montenegrin legislator, the purpose of this reform is to harmonize the national legislation with the EAPO, as well as creating ‘the necessary conditions for its smooth application’.

In terms of substance, the specific provisions on the EAPO focus primarily on identifying the different authorities involved in the EAPO procedure from the moment it is granted to its enforcement. In broad terms, the content of the provisions corresponds to the information that Member States were required to provide to the Commission by 18 July 2016, and that can be found in Article 50. One provision establishes which are the competent courts to issue the EAPO and to decide on the appeal against a rejected EAPO application. Regarding the appeal procedure, it establishes that creditors have to submit their appeal within the five following days of the date the decision dismissing the EAPO application is rendered. Such a deadline contradicts the text of the EAPO Regulation, which sets a 30-day deadline to submit the appeal, which cannot be shortened by national legislation. This is an aspect that has been uniformly established by the EU legislator, thus it does not depend on national law (Article 46(1)).

Regarding the debtors’ remedies to revoke, modify or terminate the enforcement of an EAPO contained Articles 33, 34 and 35, the reform contains a specific provision to determine which are the competent courts. Interestingly, it also establishes  a 5-day deadline to appeal the decision resulting from the request for a remedy. In this case, the EAPO Regulation does not establish any deadline, giving Member States discretion to establish such deadline. The short deadline chosen contrasts with the 15 days established in Luxembourg (Article 685-5(6) Nouveau Code de Procedure Civile), the one-month deadline chosen by the German legislator (Section 956 Zivilprozessordnung).

Concerning the enforcement phase of the EAPO, it determines which are the authorities responsible for the enforcement. It also acknowledges that there are certain amounts exempted from attachment of an EAPO under Montenegrin law.

Last but not least, the reform also tackles the information mechanism to trace the debtors’ bank accounts. The information authority will be Montenegro’s Central Bank (Centralna Banka). The method that will be employed to trace the debtors’ bank accounts consists of asking banks to disclose whether they hold the bank accounts. This method corresponds to the first of the methods listed in Article 14(5) that information authorities can use to trace the debtors’ bank accounts.

The entry into force of these new EAPO provisions is postponed until Montenegro joins the EU.  While these provisions might seem rather generic, they clearly reveal Montenegro’s commitment to facilitate the application of the EAPO within its legal system and make it more familiar for national judges and practitioners that will have to deal with it.

This is a special moment for us after a long way, and forgive us for highlighting it in a special edition of our Repository: Our book on the HCCH 2019 Judgments Convention that we have worked on over the last years has come out! Big thanks to all involved, including Hart Publishing who made this possible.

As kindly highlighted in the Series Editor’s Preface, the book is enriched by the diverse perspectives not only of distinguished legal scholars from around the world, but also experienced practitioners from the HCCH, UNCITRAL and the EU who are familiar with the intricacies of negotiating within the HCCH framework. Furthermore, the volume does not limit itself to examining the legal cornerstones of the convention (Part I) but also strives to illuminate its prospects in leading regions of the world (Part II) and, finally, ventures – based on the insights gained from the judgments project’s genesis – an outlook on future developments (Part III). Hence, the book provides a truly global appraisal of the HCCH 2019 Judgments Convention and is therefore likely to become a major point of reference for legislators, judges, legal scholars and lawyers in the field of Private International Law.

We are happy to announce that the volume will be available at special rates to the conference participants in Bonn on 9 and 10 June 2023. If you are interested in discussing the latest advancements in global judicial cooperation with our learned authors, please be invited to register with sekretariat.weller(at)jura.uni-bonn.de. We will be able to handle last minute registrations …

Today the Hague Academy of International Law begins its celebrations to mark its centenary.

As indicated on its website: “Tirelessly since 1923, the Academy works, in The Hague, rightly named the International City of Peace and Justice, on “the teaching, study, dissemination and wider appreciation of international law”, to take the words of the United Nations General Assembly. After 100 years, it is time to make a short pause, at the occasion of a Solemn Sitting on 24 May, and look at what has been, what is, and also what, beyond the Centenary, must be accomplished by the Academy.”

There are two main events organised:

On Wednesday 24 May a solemn sitting will take place, the agenda is available here.

On Thursday 25 May  and Friday 26 May a colloquium will be held, the agenda is available here. Some of the interesting sessions in our area are “public interest in international law”, “public interest in litigation”, “humanization of private international law” and “the law applicable to international arbitration”.

Both events will be streamed online but only accessible to registered participants.

We (and I am sure all of its alumni) rejoice with the Hague Academy in celebrating this important milestone.

The author of this post is Lydia Lundstedt, Senior Lecturer at the Stockholm University.

Under Swedish copyright law, broadcasting organizations are granted certain exclusive rights over their broadcasts (“signal right”). A signal right is one of the “related” or “neighboring” rights to copyright along with the rights of performers and producers of phonograms. Pursuant to Section 48 of the Swedish Act (1960:729) on Copyright in Literary and Artistic Works (Swedish Copyright Act) broadcasting organizations have an exclusive right to inter alia authorize the rebroadcast or a communication to the public in places accessible to the public against the payment of an entrance fee. This section incorporates Sweden’s obligations under Article 8(3) of the EU Rental and Lending Directive 2006/115/EC.

As a general rule, the Swedish Copyright Act applies in relation to other countries only on condition of reciprocity, or if it follows from an international treaty. Article 6(1) of the 1961 International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (Rome Convention) requires that Sweden grant national treatment to foreign broadcasting organizations if (1) they are established in another contracting State; or (2) if the broadcast was transmitted from a transmitter situated in another contracting State. This treaty obligation is incorporated into Section 12 of the Swedish International Copyright Regulation (1994:193) (International Copyright Regulation). The second point of attachment is formulated slightly differently in the International Copyright Regulation. It refers to “broadcasts which have been made” but does not include the words “from a transmitter situated”.

In a case before the Swedish courts, the question arose of the interpretation of this point of attachment when a satellite broadcasting chain of transmission spans several States. On 12 May 2023, the Swedish Supreme Court held that a satellite broadcast should normally be considered to take place in the state where the transmission of the programme-carrying signals was initiated.

Two persons, acting in their capacity as representatives for a company established in Sweden, were prosecuted for intentionally or through gross negligence, retransmitting television broadcasts produced by another company established in Qatar. The Swedish company had retransmitted via IPTV the Qatari company’s broadcasts to its own customers all over the world without obtaining the Qatari company’s consent. The Qatari company brought a civil claim for damages in connection with the prosecution. A prerequisite for finding the two persons guilty of the offense of unlawful retransmission and liable for damages was that the Qatari company’s broadcasts were eligible for protection under Swedish law.

It is important to distinguish the question whether the Qatari company was eligible for protection under Swedish law, which deals with the rights of foreigners, from the traditional private international law question concerning the applicable law. In this case, the applicable law question did not arise. First, nationals courts only apply their own criminal law so it is clear that Swedish law applies in a Swedish criminal proceeding. Second, with respect to the Qatari company’s claim for damages, which it a private law question, the Qatari company claimed protection for Sweden so Swedish law was applicable under Article 8(1) Regulation (EC) No 864/2007 on the law applicable to non-contractual obligations (Rome II). As said, however, the application of Swedish law was never questioned. Instead, the question was whether the Qatari company was eligible for protection under Swedish law.

Qatar was not a contracting state to the Rome Convention at the time that the broadcasts took place. Although the Qatari company produced its television programmes in Qatar, it sent the programme signals via fibre cable to a related company in France and then to the United Kingdom and Spain. Via uplink stations in the United Kingdom and Spain, the signals were sent to satellites to be received by the public in the Middle East and Northern Africa.

The Swedish Patent and Market Court (PMD) found that the Qatari company’s broadcasts were made “at least” in the United Kingdom and Spain, which are both contracting states to the Rome Convention. On appeal, however, the Patent and Market Court of Appeal (PMÖD) reversed and held that the broadcast took place only in Qatar. The Supreme Court affirmed the decision of the PMÖD.

Article 3(f) of the Rome Convention defines broadcasting as “the transmission by wireless means for public reception of sounds or of images and sounds”. Although the Rome Convention was drafted before the time of satellite broadcasts, the Court stated that such broadcasts could nonetheless be considered to fall under its scope.

The Court then observed that section 61 a of the Copyright Act deals specifically with satellite broadcasting and localizes the “copyright relevant act” “in the country where the broadcasting organization, under its control and its responsibility, introduces the subject matter into an uninterrupted chain of communication to the satellite and from there down towards the earth.” Section 61 a implements Article 1(2)(b) of the EU Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission (SatCab Directive). The Court noted that the aim of this rule is to enable a broadcasting company that uses other people’s protected subject matters, to easily identify for which Member State it needs to obtain a license. The Court pointed out that the application of this rule presupposes that the subject matter (e.g. a broadcast) is protected under the Copyright Act. The Court therefore observed that this rule “had no immediate significance for the assessment of whether the broadcast as such is protected by that Act”.

The Court observed that neither Article 6 of the Rome Convention nor section 12 of the International Copyright Regulation contain specific provisions on where a broadcast is deemed to take place when the chain of transmission spans several different states. The Court noted however that “in a related context”, the Court of Justice of the European Union (CJEU) held that customary technical activities to prepare signals for their introduction into a satellite communication uplink cannot be regarded as interruptions in the transmission in the meaning of Article 1(2) of the SatCab Directive (see Airfield and Canal Digitaal (C-431/09 and C-432/09).

The Court found that this approach was consistent with the text of the Rome Convention and the International Copyright Regulation. The Court stated therefore that in the case of a broadcast involving several intermediate technical steps, the broadcast “was transmitted” (within the meaning of the Rome Convention) and “was made” (within the meaning of the International Copyright Regulation) in the state where the transmission of the signals was initiated. The Court added that the fact that the chain of transmission includes elements which, individually, are not covered by the rules of the Rome Convention, e.g. because the signals at one stage are not transmitted by wireless means, does not preclude such a reading of the provisions.

The Court also found that this interpretation was in line with the aim of protecting broadcasting organizations against the unauthorized exploitation of their broadcasts. The Court reasoned that broadcasting companies make their primary investments in the state from which the broadcast is initially generated and using the state of uplink or where other intermediate technical steps are taken would not satisfy this aim to the same extent.

Thus, the Court held that the entire chain of transmission starting with the transmission of the signals via fibre cable from Qatar and ending with their reception on the ground to subscribers was one single broadcast which must be regarded as having been made in Qatar. This meant that the Qatari company was not eligible for protection under Swedish law and the prosecution against the two individuals for a violation of the Copyright Act and the Qatari company’s damage claim were rejected.

It is a bit surprising that the Court first states that section 61 a of the Swedish Copyright Act and the SatCab Directive “had no immediate significance” for the question of whether a broadcast is eligible for protection but then applies the approach set out in the SatCab Directive to determine whether a broadcast is eligible for protection. It can be questioned whether the situation regulated in the SatCab Directive really can be said to be “a related context” as the SatCab Directive regulates a different situation than the Rome Convention and the International Copyright Regulation.

As noted above, the SatCab Directive deals with cross-border licensing of protected subject matter and Article 1(2)(b) localizes where a user is said to exploit another person’s protected subject matter when the subject matter is transmitted to a satellite from one Member State but received by the public on the ground in several other Member States. In contrast, Article 6 of the Rome Convention and the corresponding provision in the International Copyright Regulation deal with the protection of foreign broadcasters and lay down the conditions for affording national treatment to their signals.

Moreover, the SatCab Directive has a different aim than the Rome Convention and the International Copyright Regulation. The SatCab Diective aims to promote pan-European broadcasting by localizing the copyright relevant act in a single Member State while at the same time requiring a minimum level of harmonization to ensure that the protection level is sufficiently high in all Member States. This facilitates cross-border licensing because users of protected subject matters only need to clear the rights in one Member State as opposed to all Member States where the subject matters can be received. In line with this aim of avoiding the cumulative application of several national laws to one single act of broadcasting, normal technical procedures relating to the programme-carrying signals are not to be considered as interruptions to the chain of broadcasting (see recital 14 SatCab Directive).

In contrast, as the Court itself notes, the aim of the Rome Convention is to protect broadcasting organizations against the unauthorized exploitation of their broadcasts. To fulfil this aim, the Rome Convention contains alternative points of attachment (i.e. the broadcaster’s state of establishment or the state where a transmitter that transmits the broadcast is situated). It would be consistent with the aim of the Rome Convention to localize a broadcast in all states with which the broadcast has a significant connection such as a transmitter, or in a cascade-like fashion stopping at the first contracting state that has a significant connection to the broadcast.

It can be noted that the Court did not seem to place any emphasis on the wording “from a transmitter situated in another Contracting State” that appears in the Rome Convention, although not in the International Copyright Regulation. Normally, this point of attachment allows a broadcasting organization that is established outside a Rome contracting state to enjoy protection if its transmitter is situated in a contracting state. While a contracting state may declare that they will apply both points of attachment cumulatively, Sweden has not done so. Still, the practical effect of the ruling seems to require this as it is likely that signals will usually be initiated from the state where the broadcaster is established.

One can make an analogy with the Berne Convention that allows authors who are not nationals of a contracting state to the Berne Union to be eligible for protection under the Convention by publishing their works first in a contracting state to the Berne Union, or simultaneously in a state outside the Berne Union and in a state of the Berne Union. That said, one might view the right of foreign broadcasters in their signals as less deserving of protection than the right of authors in their works. Moreover, non-contracting states would not have any incentive to join the Rome Convention if their broadcasters could secure protection by sending their signal through contracting states.

A question could be raised whether the Court should have referred a question to the CJEU on the interpretation of the Rental and Lending Directive. As noted above, section 48 of the Swedish Copyright Act fulfills Sweden’s obligation under the Rental and Lending Directive to afford broadcasting organizations the exclusive right to authorize or prohibit the communication to the public of their broadcasts against payment of an entrance fee. While the Directive itself does not define who is considered to be a broadcasting organization eligible for protection under the Directive, the concept should be interpreted consistently with the EU’s international treaty obligations. See Recorded Artists Actors Performers (C-265/19). In this case, however, the relevant obligation was under the Rome Convention and the EU is not itself a contracting party.

Article 3 of the TRIPS Agreement, which is an international convention concluded by the EU, obligates the EU to accord national treatment to the nationals of other Members in respect of the rights provided under the Agreement. Article 14.3 TRIPS provides broadcasting organizations a signal right, albeit to a more limited extent than the Rome Convention. Importantly, Article 1.3 of TRIPS incorporates the criteria for eligibility for protection in the Rome Convention to determine who is eligible for protection under TRIPS. Thus, the question concerning the interpretation of Article 6 of the Rome Convention arguably falls indirectly within the CJEU’s adjudicative competence, notwithstanding that the EU is not itself a contracting party, when the right claimed is one that implements Article 14.3 TRIPS. This is because the CJEU may need to interpret the rules in Article 6 of the Rome Convention to establish the EU and its Member States’ obligations under TRIPS. Thus, it is possible that the CJEU will have the opportunity in the future to have its say about where a satellite broadcasting chain of transmission that spans several different states takes place for the purpose of determining its eligibility for protection under TRIPS.

As noted earlier on this blog, on 24 May 2023, from 6 pm to 8 pm CEST, the forth and last webinar of the series that has been organised under the title The Future of Cross-Border Parenthood in the EU – Analyzing the EU Parenthood Proposal will take place. The webinar, chaired by Steve Heylen, will deal with the following relations:  Authentic documents and
parenthood: between recognition and acceptance (Patrick Wautelet), and The European certificate of Parenthood: A passport for parents and children? (Ilaria Pretelli).

Those wishing to attend have time until 23 May 2023 at noon to register. The registration form is available here.

Registered participants will receive the details to join the webinar by e-mail (please note the e-mails with these details occasionally end up in the spam folder).

The updated and final version of the program is available here.

On 30 June 2023, the second edition of the Austrian Private International Law Workshop will take place in Innsbruck. The organisers cordially invite all interested researchers and practitioners to participate and register via evip@uibk.ac.at. Participation is free of charge. The workshop will be conducted in German and will consist of two sessions, chaired by Florian Heindler and Andreas Schwartze, respectively.

Presentations will discuss, inter alia: Current trends in the case law of the CJEU on conflict of laws (Marlene Brosch, ECJ); The EU Succession Regulation and the Austrian Supreme Court – where it should have applied for a preliminary ruling (Gottfried Musger, Austrian Supreme Court); Parent in one country, parent in every country: The proposal for an EU Parenthood Regulation (Martina Melcher, University of Graz); International enforcement of legal rules on social networks (Brigitta Lurger, University of Graz); The corporation seat theory between connecting factor and domestic nexus (Chris Thomale, University of Vienna); Crypto assets in private international law (Matthias Lehmann, University of Vienna/Radboud University Nijmegen).

A forum chaired by Bernhard A. Koch (University of Innsbruck) and Simon Laimer (University of Innsbruck) on the the most pressing challenges for private international law in the coming years and decades will conclude the event.

The updated and final version of the program is available here.

This post was written bij Helga Luku, PhD researcher at the University of Antwerp.

On 1 March 2023, the Supreme Administrative Court of the Republic of Bulgaria issued its final decision no. 2185, 01.03.2023 (see here an English translation by Nadia Rusinova) in the Pancharevo case. After an appeal from the mayor of the Pancharevo district, the Supreme Administrative Court of Bulgaria ruled that the decision of the court of first instance, following the judgment of the Court of Justice of the European Union (CJEU) in this case, is “valid and admissible, but incorrect”. It stated that the child is not Bulgarian due to the lack of maternal ties between the child and the Bulgarian mother, and thus there is no obligation for the Bulgarian authorities to issue a birth certificate. Hereafter, I will examine the legal reasoning behind its ruling.

Background

On 2 October 2020, the Administrative Court of the City of Sofia in Bulgaria requested a preliminary ruling from the CJEU in the case C-490/20 V.M.A. v. Stolichna Obshtina, Rayon ‘Pancharevo’. It sought clarification on the interpretation of several legal provisions. Specifically, the court asked whether a Member State is obliged, under Article 4(2) of the Treaty on European Union (TEU), Articles 20 and 21 of the Treaty on the Functioning of the European Union (TFEU), and Articles 7, 24, and 45 of the Charter of Fundamental Rights of the European Union (the Charter), to issue a birth certificate to a child, who is a national of that Member State, in order to obtain the identity document. This inquiry arose with respect to a child, S.D.K.A., born in Spain, whose birth certificate was issued by Spanish authorities, in accordance with their national law. The birth certificate identifies a Bulgarian national, V.M.A., and her wife, a British national, as the child’s mothers, without specifying which of the two women gave birth to the child.

The CJEU decided that Article 4(2) TEU, Articles 20 and 21 TFEU and Articles 7, 24 and 45 of the Charter, read in conjunction with Article 4(3) of Directive 2004/38/EC on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States, must be interpreted as meaning that, in the case of a child, being a minor, who is a Union citizen and whose birth certificate, issued by the competent authorities of the host Member State, designates as that child’s parents two persons of the same sex, the Member State of which that child is a national is obliged

• to issue to that child an identity card or a passport without requiring a birth certificate to be drawn up beforehand by its national authorities, and
• to recognise, as is any other Member State, the document from the host Member State that permits that child to exercise, with each of those two persons, the child’s right to move and reside freely within the territory of the Member States.

The trajectory of the case within the Bulgarian courts

On the basis of the decision of the CJEU in the Pancharevo case, the referring court, i.e. the Administrative Court of the City of Sofia obliged the authorities of the Pancharevo district to draw up the birth certificate of S.D.K.A., indicating two women as her parents.

The mayor of the Pancharevo district then filed an appeal to the Supreme Administrative Court of Bulgaria, contending that the decision is inadmissible and incorrect.

Based on its considerations, the Supreme Court held that the decision of the court of first instance is “valid and admissible but incorrect”. Its rationale is premised on several arguments. Firstly, it referred to Article 8 of the Bulgarian Citizenship Law, which provides that a Bulgarian citizen by origin is everybody of whom at least one of the parents is a Bulgarian citizen. In the present case, the Supreme Court deemed it crucial to ascertain the presence of the biological link of the child, S.D.K.A. with the Bulgarian mother, V.M.A. Thus, it referred to Article 60 of the Bulgarian Family Code, according to which the maternal origin shall be established by birth; this means that the child’s mother is the woman who gave birth to the child, including in cases of assisted reproduction. Therefore, the Supreme Court proclaimed in its ruling that the Bulgarian authorities could not determine whether the child was a Bulgarian citizen since the applicant refused to provide information about the child’s biological mother. Consequently, the authorities could not issue a birth certificate and register the child’s civil status. Furthermore, in a written defence presented to the court of first instance by the legal representative of V.M.A., it was provided that S.D.K.A. was born to K.D.K., the British mother, and the British authorities had also refused to issue a passport to the child, as she was not a British citizen.

The Supreme Administrative Court of Bulgaria ruled that the child is not a Bulgarian citizen, and the conclusion of the CJEU that the child is a Bulgarian citizen and thus falls within the scope of EU law (Articles 20 and 21 TFEU and Article 4 of Directive 2004/38/EC) is inaccurate. According to the Supreme Court’s legal reasoning, these provisions do not establish a right to claim the granting of Bulgarian citizenship, and Union citizenship is a prerequisite for enjoying free movement rights.

In these circumstances, the Supreme Administrative Court of Bulgaria held that the refusal to issue a birth certificate does not result in the deprivation of citizenship or the violation of the child’s best interests. It referred to the law of the host country, Spain. Article 17 of the Spanish Civil Code of July 24, 1889, provides that Spanish citizens by origin are persons born in Spain to parents:

• who are foreigners if at least one of the parents was born in Spain (except for the children of diplomatic or consular officials accredited to Spain),
• who are both stateless, or
• neither of whose national laws confer nationality on the child.

According to this Article, the Supreme Court reasoned that since the national laws of the parents named in the child’s birth certificate (i.e. Bulgarian and UK legislation), issued in Spain, do not grant citizenship to the child, baby S.D.K.A. must be considered a Spanish citizen by virtue of this provision.

The applicability of Spanish law was expressly confirmed by the Spanish Government during the hearing at the CJEU, provided in paragraph 53 of Advocate General Kokott’s Opinion, stating that if the child could claim neither Bulgarian nor UK nationality, she would be entitled to claim Spanish nationality. Thus, the Supreme Court ruled that the child is Spanish and averted the risk of leaving the child stateless.

Is the decision of the Supreme Administrative Court of Bulgaria in conformity with EU law interpretation?

In light of the ruling of the CJEU on the Pancharevo case, certain aspects might have required further scrutiny and more attention from the Supreme Court. Paragraph 68 of the Pancharevo judgment provides:

“A child, being a minor, whose status as a Union citizen is not established and whose birth certificate, issued by the competent authorities of a Member State, designates as her parents two persons of the same-sex, one of whom is a Union citizen, must be considered, by all Member States, a direct descendant of that Union citizen within the meaning of Directive 2004/38 for the purposes of the exercise of the rights conferred in Article 21(1) TFEU and the secondary legislation relating thereto.”

According to this paragraph, it can be inferred that Bulgaria and other Member States must recognize a child with at least one Union citizen parent as a direct descendant of that Union citizen. This paragraph has important implications as regards the establishment of the parent-child relationship. The CJEU, in its case law (C-129/18 SM v Entry Clearance Officer), has firmly established that the term “direct descendant” should be construed broadly, encompassing both biological and legal parent-child relationships. Hence, as a family member of the Bulgarian mother, according to Article 2 (2)(c) of Directive 2004/38, baby S.D.K.A., should enjoy free movement and residence rights as a family member of a Union citizen. In its decision, however, the Supreme Administrative Court of Bulgaria did not conform to the CJEU’s expansive understanding of the parent-child relationship. Therefore, its persistence in relying on its national law to establish parenthood exclusively on the basis of biological ties appears to contradict the interpretation of EU law by the CJEU.

The Supreme Administrative Court of Bulgaria seems relieved to discover that the child probably has Spanish nationality. It can be doubted, however, at what conclusion the court would have arrived if the child were not recognized as Spanish under Spanish nationality laws, especially considering that the child was not granted nationality under UK legislation either. In such a scenario, the Supreme Court might have explored alternative outcomes to prevent the child from becoming stateless and to ensure that the child’s best interests are always protected.

This post was written by Carlos Santaló Goris (Lecturer at the European Institute of Public Administration in Luxembourg).

On 20 April 2023, the Court of Justice of the European Union (CJEU) rendered its second judgment on Regulation 655/2014, establishing a European Account Preservation Order (‘EAPO Regulation’). In C-291/21, Starkinvest, the Court assessed whether an EAPO could be used to secure a claim resulting from a penalty payment, and if so, under what conditions.  

C-291/21, Starkinvest, has its roots in a 2016 judgment rendered by the Court of Appeals of Liège (Cour d’appel de Liège) rendered in favor of Starkinvest SRL ordering Soft Paris and Soft Paris Parties, ‘to cease all sales of their goods and services under the word mark SOFT PARIS in the Benelux countries’ (para. 18). The judgment established a periodic penalty payment in the event the order to cease sales was not respected.

In 2021, Starkinvest SRL applied for an EAPO to attach Soft Paris’ French bank accounts for € 86 694.22. Of that amount, € 85.000 corresponded to the penalty payments resulting from Soft Paris’ infringement of the order to cease the sale of goods. Starkinvest used the referred judgment rendered by the Court of Appeals of Liège (Cour d’appel de Liège) as the title to obtain the EAPO.

At this point, it should be noted that the regime to obtain an EAPO varies depending on whether the creditor has an enforceable judgment or not. All creditors have to prove that ‘there is a real risk that, without such a measure, the subsequent enforcement of the creditor’s claim against the debtor will be impeded or made substantially more difficult’ (Article 7(1) EAPO Regulation. This first prerequisite corresponds to the periculum in mora. Creditors without an enforceable judgment ‘shall also submit sufficient evidence to satisfy the court that he is likely to succeed on the substance of his claim against the debtor’ (Article 7(2) EAPO Regulation). This second condition corresponds to another common prerequisite for obtaining a national interim measure, the fumus boni iuris.

For the Court of Appeals of Liège (Cour d’appel de Liège), it was not clear whether the judgment establishing the penalty payment but not specifying the amount the claim arising from that penalty payment was valid a judgment that would exempt creditors from satisfying the fumus boni iuris. In this regard, Belgian legislation does not require the prior quantification of the claim arising from a penalty payment to request a preservation order ‘provided that the decision ordering penalty payments is enforceable and has been serving’ (para. 23). Conversely, the Belgian court also acknowledges that Article 55 of the Brussels I bis Regulation establishes that ‘a judgment that ”orders a payment by way of a penalty” can only benefit from the simplified scheme of enforcement the amount of the payment has been finally determined by the court of origin.’ Having no answer to such inquiry, the Court of Appeal of Liège (Cour d’appel de Liège) decided to submit the following questions to the CJEU:

(1) Does a judgment which has been served, ordering a party to make a penalty payment in the event of breach of a prohibitory order, constitute a [judgment] requiring the debtor to pay the creditor’s claim within the meaning of Article 7(2) of [Regulation No 655/2014]?

(2) Does a judgment ordering a party to make a penalty payment, although enforceable in the country of origin, fall within the meaning of “judgment” in Article 4 of [Regulation No 655/2014] where there has been no final determination of the amount in accordance with Article 55 of [Regulation No 1215/2012]?

In essence, the CJEU was asked whether the judgment that established the penalty payment was a valid judgment that would exempt the creditor from proving the fumus boni iuris. More concretely, whether or not the claim amount had to be specified in the judgment as a condition to consider the judgment a valid title. In this regard, neither Article 4(5), which contains the definition of judgment, nor Article 7(2), the provision on the fumus boni iuris, does not state anything about the quantification of the claim in the judgment (paras 42 – 43). Nonetheless, other provisions do so. Article 6 refers to the ‘amount specified in the judgment’, while Article 8(2)(g) states that creditors can apply for an EAPO in ‘the amount of the principal claim as specified in the judgment’ (paras 46 – 47). Therefore, a systematic interpretation suggests that the judgment would have to contain the precise amount of claim.

The CJEU found that the specification of the amount of the claim is also a guarantee to maintain an adequate balance between the creditor’s and debtor’s interests in the EAPO procedure (para. 50). If a judgment establishing the penalty payment without having specified the amount of the claim is considered a valid title to circumvent the fumus boni iuris, that would undermine the debtor’s position. The court’s examination of fumus boni iuris is both a condition for creditor to access the EAPO and a guarantee for the debtor against abusive applications when there is no title acknowledging the claim. When the amount of penalty payment is not quantified, courts should have the discretion to assess whether there is a basis for the amount the creditor requested the EAPO for. Interestingly, AG Szpunar added, in his opinion, that while the judgment establishing penalty payment would not constitute a valid title, it is not ‘is meaningless for the creditor’. Creditors could use it, along ‘with documents provided by a court official in which the court official declares the breaches of the prohibitory order’, to prove the fumus boni iuris (paras. 82 – 83). Creditors willing to secure a penalty payment through an EAPO can find a practical tip here.

Lastly, the CJEU addressed the enforcement regime of judgments ordering penalty payments under the Brussels I bis Regulation. In this regard, the Court clarified that even if the EAPO does not have an equivalent provision, that does not imply that the ‘intention of the EU legislature was to exclude penalty payments from the scope of that regulation’ (para. 55). Therefore, the EAPO could be used to secure penalty payments. However, the judgment ordering the penalty payment without quantifying the claim is insufficient to overcome the fumus boni iuris.

The main contribution of the C-291/21 judgment is that it shows that the EAPO can be used to secure penalty payments. In this regard, it aligned the EAPO Regulation with the Brussels I bis Regulation, which expressly acknowledges the possibility of recognizing and enforcing penalty payment judgments. Creditors can combine both instruments. While using the Brussels I bis Regulation to enforce the penalty payment, they can rely on the EAPO to secure its enforcement. Whether the EAPO can be used to secure a penalty payment might seem for many pretty obvious, the Cologne Higher Regional Court (Oberlandesgericht Köln) once rejected an EAPO request on the basis of a penalty payment under German law (Zwangsgeld), because it considered that such kind of claim fell outside the scope of the EAPO Regulation. The creditor requested a preliminary reference be submitted to CJEU, but the German court rejected such a possibility. This case came to the author’s knowledge through an interview with a German lawyer in the empirical conducted in the context of his Ph.D. dissertation.

This decision also sheds light on the autonomous notion of judgment under the EAPO Regulation (in this regard, see also Tobias Lutzi’s post on this judgment), more precisely, concerning the prerequisite that the claim has to be quantified.

As in C-555/18, the first CJEU judgment on the EAPO, the Court’s reasoning of this second judgment again pivots on the need to ‘strike an appropriate balance between the interest of the creditor in obtaining an Order and the interest of the debtor in preventing abuse of the Order’ (Recital 14). This is a recurring hermeneutic tool used by the CJEU when it comes to interpreting the EAPO and the EPO. It seems that the CJEU’s approach is to counterweight the pro-creditore spirit that underpinned the creation of the EAPO and EPO, reinforcing the debtor’s position.

Posted at the request of Shiva Patil, Technical Editor at Trade, Law and Development.

Trade, Law and Development

Call for Submissions

Special Issue

“Sustainability and Inclusivity: Evolving Paradigms of the Global Economy”

Founded in 2009, the philosophy of Trade, Law and Development (TL&D) has been to generate and sustain a constructive and democratic debate on emergent issues in international economic law and to serve as a forum for the discussion and distribution of ideas. Towards these ends, the Journal has published works by noted scholars such as the WTO DDG Yonov F. Agah, Dr. (Prof.) Ernst Ulrich Petersmann, Prof. Steve Charnovitz, Prof. Petros Mavroidis, Prof. Mitsuo Matsuhita, Prof. Raj Bhala, Prof. Joel Trachtman, Dr. (Prof.) Gabrielle Marceau, Prof. Simon Lester, Prof. Bryan Mercurio, and Prof. M. Sornarajah among others. TL&D also has the distinction of being ranked the best journal in India across all fields of law for several years by Washington and Lee University, School of Law.

Pursuant to this philosophy, the Board of Editors of TL&D is pleased to announce “Sustainability and Inclusivity: Evolving Paradigms of the Global Economy” as the theme for its next Special Issue.

It is indisputably true that sustainability which comprises the three interdependent pillars of “economic growth, social equity, and environmental protection”, is increasingly gaining traction among governments, businesses, research organisations, scholars and the general populace. Discussions in international economic law, including those surrounding world trade, cross-border investment, and development, have abundantly focused on this. Economic benefits of trade ultimately decline while the social and environmental costs rise to unbearable levels, if sustainable trade rules are not in place. Whereas, a more sustainable trade strategy would recognise the need for a more varied export mix, invest in technology, and have minimal trade barriers while balancing long-term resilience with short-term ambitions. Since TL&D’s objective is to provide a forum of exchange of ideas and constructive debate on legal and policy issues, the above-mentioned factors arguably constitute some of the biggest issues for international economic law discourse this year.

While the theme is broad enough to cover a wide range of issues, an indicative list of specific areas is as follows:

• Trade Rules and Environmental Interactions
• Environmental Protection Clauses in International Investment Agreements
• Trade and Human Rights
• Promoting Entrepreneurship/ Trade Facilitation
• Trade and Gender Justice
• Transparency and Good Governance Obligations
• Sustainable Agriculture
• Sustainable Fisheries
• Indigenous Peoples Interaction with International Trade and Investment
• Sustainable Development Goals

These sub-issues are not exhaustive, and the Journal is open to receiving submissions on all aspects related to sustainability and inclusivity in the global economy.

Accordingly, the Board of Editors of TL&D is pleased to invite original, unpublished manuscripts for publication in the Special Issue of the Journal in the form of ‘Articles’, ‘Notes’, ‘Comments’ and ‘Book Reviews’, focusing on the theme of “Sustainability and Inclusivity: Evolving Paradigms of the Global Economy”.

In case of any queries, please feel free to contact us at: editors[at]tradelawdevelopment[dot]com.

PATRON: P.P. Saxena | ADVISORS: Raj Bhala | Jagdish Bhagwati | B.S. Chimni | Glenn Wiser | Daniel B. Magraw, Jr. | Vaughan Lowe | Ricardo Ramirez Hernandez | W. Michael Reisman | M. Sornarajah | FACULTY-IN-CHARGE: Dr. Rosmy Joan | BOARD OF EDITORS: Swikruti Nayak | Aastha Asthana | Rashmi John | Ria Chaudhary | Ananya Awasthi | Jahnavi Srivastava | Yashvi Hora | Sunchit Sethi | Shiva Patil| Rishi Pareek | Anoushka | Himanshu Sharma| Priyanshu Shrivastava | Simran Bherwani | Yana Gupta | Alka Mahapatra | Anandita Srivastava | Ishaan Pant | Krishna Ravishankar | Neel Rao | Samiksha Lohia | Shambhavi Uniyal | Sonali P. Raju