Flux européens

Rather like I note in my report on Highbury Poultry Farm,  Secretary of State for Health & Ors v Servier Laboratories Ltd & Ors [2020] UKSC is another example of why the UK Supreme Court and counsel to it will be missed post Brexit.

The case in essence queries whether a CJEU annulment (in General Court: Case T-691/14, currently subject to appeal with the CJEU) of a finding by the European Commission that companies breached Article 101 and 102 TFEU’s ban on anti-competitive practices, is binding in national proceedings that determine issues of causation, remoteness and mitigation of loss. The answer, in short: no, it does not.

The case essentially revolves around the difficulty of applying common law concepts of authority and precedent to the CJEU’s more civil law approach to court decisions. For those with an interest in comparative litigation therefore, it is a case of note.

The essence in the national proceedings is whether Claimants [who argue that Servier’s breaches of EU and UK competition law led to a delay in generic Perindopril entering the UK market, resulting in higher prices of Perindopril and financial loss to the NHS) failed to mitigate the loss they claim to have suffered as a result of Servier’s (the manufacturer of the drug) infringement of the competition rules. The Court of Appeal’s judgment is best read for the facts.

In T-691/14 Servier SAS v European Commission, the General Court of the EU had annulled only part of the European Commission’s decision by which it was found that the Appellants had infringed Article 102 TFEU. In the present proceedings, Servier seek to rely on a number of factual findings made by the
GCEU in the course of its judgment and argue that the English courts are bound by those findings. The High Court and the Court of Appeal have held that the propositions on which the Appellants seek to rely are not res judicata.

Core CJEU authority discussed is Joined Cases C-442/03P and C-471/03P P&O European Ferries (Vizcaya) SA and Diputación Foral de Vizcaya v Commission.

Lord Lloyd-Jones reaches the crux of his reasoning, on the basis of CJEU authority, at 39:

The principle of absolute res judicata gives dispositive effect to the judgment itself. It is the usual practice of EU courts to express the outcome of the action in a brief final paragraph of the judgment referred to as the operative part. While this will have binding effect, it will be necessary to look within the judgment beyond the operative part in order to ascertain its basis, referred to as the ratio decidendi. (EU law has no system of stare decisis or binding precedent comparable to that in common law jurisdictions and this EU concept of ratio decidendi is, once again, distinct from the concept bearing the same name in the common law.) It will be essential to look beyond the operative part in this way in order to identify the reason for the decision and in order that the institution whose act has been annulled should know what steps it must take to remedy the situation. In a case where the principle of absolute res judicata applies, it will extend to findings that are the necessary support for the operative part of the annulling judgment.

The GC’s findings were based on a limited ground only, relating to too narrow a market definition under A102 TFEU. As presently constituted, the claim in the national proceedings is a claim for breach of statutory duty founded on alleged infringements of article 101 TFEU. No question arises in the proceedings before the national court as to the relevant product market for the purposes of A102 or the applicability of A102.

The national proceedings therefore concern causation, remoteness and mitigation of loss in the arena of article 101 TFEU. The narrow res judicata window, it was held, clearly does not apply to them and that is acte clair which needs no referral to Luxembourg.

Geert.

 

 

Binding scope of #CJEU annulment of EU measure
Viz Res judicata, issue estoppel and abuse of process as understood in common law jurisdictions
Whether annulment of EC 101 TFEU finding is binding in national proceedings re issues of causation, remoteness and mitigation of loss https://t.co/yrgyoosoVr

— Geert Van Calster (@GAVClaw) November 6, 2020

Directive (EU) 2020/1828 of the European Parliament and of the Council of 25 November 2020 on representative actions for the protection of the collective interests of consumers and repealing Directive 2009/22/EC has been published today at the OJEU.

The text is attached to this post.

collective-redress-directiveDownload

The new Evidence and Services Regulations were published at the OJEU of 2 December 2020:

__ Regulation (EU) 2020/1783 of the European Parliament and of the Council of 25 November 2020 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters (taking of evidence) (recast)

__ Regulation (EU) 2020/1784 of the European Parliament and of the Council of 25 November 2020 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents) (recast)

They are attached to this post.

evidence-regulation-bisDownload service-regulation-terDownload

The European Commission adopted yesterday (2 December) “a package of initiatives to modernise the EU justice systems. The two main pillars of the new package are the Communication on the digitalisation of justice in the EU, and the new Strategy on European judicial training. This digital justice toolbox aims at further supporting Member States to move ahead their national justice systems towards the digital era and at improving EU cross-border judicial cooperation between competent authorities. As regards European judicial training, the Commission equips judges, prosecutors and justice professionals for the challenges of the 21st century, such as digitalisation. It further aims at promoting a common European judicial culture, based on the rule of law, fundamental rights and mutual trust”.

Extracts of the press release:

__ “Communication on the Digitalisation of Justice in the EU provides a toolbox to promote the use of digital tools by Member States […]:

Making digital the default option in cross-border judicial cooperation: To date, many judicial proceedings, including those that transcend borders, still take place with paper and by post. The European Commission will work on a legislative proposal to digitalise cross-border judicial cooperation procedures in civil, commercial and criminal matters. Adoption is planned for the end of 2021.

[…]

Better access to information: Electronic databases are easy to consult, they minimise costs for users and are resilient to crises. Therefore, Member States should strive to digitalise their registers and work towards their interconnections.

IT tools for cross-border cooperation: e-CODEX (e-Justice Communication via Online Data Exchange) is the main tool for secure cooperation in civil, commercial and criminal law proceedings across borders. To date, only some Member States use e-CODEX. With the adoption of today’s legislative proposal, the Commission aims to make e-CODEX the gold standard for secure digital communication in cross-border judicial proceedings in all Member States. As of 1 July 2023, the Commission entrusts this system to the Agency eu-LISA. Another digital tool is eEDES (e-evidence digital exchange system), which some Member States use to swiftly and securely exchange European Investigation Orders, mutual legal assistance requests and associated evidence in digital format instead of by post. With the legislative proposal adopted today, the Commission encourages all Member States to connect to eEDES. These IT tools will modernise EU justice systems and generate real European added-value”.

__ “EU Strategy on Judicial Training […]: by 2024, 65% of judges and prosecutors and 15% of lawyers shall be trained yearly on EU law. The strategy also supports justice professionals in the Western Balkans and in other EU partner countries, in Africa and Latin America. In addition, justice professionals will be able to look for training courses on EU law via the European Training Platform, launched today for a first test phase and planned to be fully operational in the course of 2021”.

Source: https://ec.europa.eu/commission/presscorner/detail/en/IP_20_2246

(with further documents)

Austrian Airlines
Transport
Selon l’avocat général Pikamäe, le simple déroutement d’un vol vers un aéroport de repli situé à proximité de l’aéroport initialement prévu n’a pas pour conséquence de donner droit à une indemnisation forfaitaire

Commission / Belgique et Magnetrol International
Aide d'État
Tax rulings : selon l’avocate générale Kokott, la Commission a considéré à juste titre que la pratique des autorités belges d’ajustement négatif des bénéfices des entreprises faisant partie d’un groupe multinational constitue un régime d’aides

Commission / Espagne (Détérioration de l’espace naturel de Doñana)

Selon l’avocate générale Kokott, le captage excessif des eaux souterraines dans l’espace naturel de Doñana situé en Andalousie constitue un manquement au droit de l’Union

Hongrie / Parlement
Droit institutionnel
Selon l’avocat général Bobek, la Cour devrait rejeter le recours de la Hongrie contre la résolution du Parlement déclenchant la procédure de constatation de l’existence d’un risque clair de violation grave, par cet État membre, des valeurs sur lesquelles l’Union est fondée

Star Taxi App
Rapprochement des législations
Un service qui met en relation directe, au moyen d’une application électronique, des clients avec des chauffeurs de taxi constitue un service de la société de l’information dès lors qu’il ne constitue pas une partie intégrante d’un service global dont l’élément principal serait une prestation de transport

Région de Bruxelles-Capitale / Commission
Agriculture
La Région Bruxelles-Capitale n’est pas recevable à demander l’annulation du règlement d’exécution de la Commission renouvelant l’approbation de la substance active glyphosate

Probably precisely because it would have been obvious, Bobek AG did not refer in the opening lines of his Opinion in C-307/19 Obala v NLB to Groundhog Day, which, following Pula Parking, this case certainly is. He did at 2 summarise why the issue, essentially on the notion of ‘civil and commercial’ under Brussels Ia and the Service Regulation 1393/2007 keeps on coming before the CJEU (this time in no less than 9 long questions):

The crux of the problem appears to be a certain double privatisation carried out by the Croatian legislature at both management and enforcement level. A matter commonly perceived in other Member States to be administrative in nature is entrusted to private entities. The subsequent enforcement of such a claim is also not designed to be a matter for the courts, but rather, at least at first instance, for notaries.

The EC had objected to quite a few questions on the basis that they engaged too much the substance of the case, which the AG disagrees with: at 31 he suggest that inevitably in conflict of laws jurisdictional advice, ‘telescopic analysis of the substance’ is needed.

On the issue of ‘civil and commercial’, Germany and Slovenia submit the origin of the power under which the contract was concluded and which is enforced in this respect that is determinant.  The applicant, the Croatian Government and the Commission take the opposite view: to them, it is not the origin of the power but rather the modalities of its exercise which represent the determinative element for identifying ‘civil and commercial matters’. It is quite extraordinary that we should still not have consensus on this after to many cases, however as I noted in my review of Buak, the divergent emphasis by different chambers of  the Court has not helped.

At 42 ff Bobek summarily revisits the case-law under BIa (he concedes at 53-54 that case-law on other instruments does not add much), concluding at 52 that the CJEU has used both the ‘subject matter’ approach and the ‘legal relationship’ approach, without expressing a preference for either.

At 59 the Advocate-General opts for the ‘legal relationship’ approach, arguing that path ‘most reliably performs the function of the figurative railroad switch point guiding the dispute from one procedural track to another in search of the ‘right’ institutional path in a Member State at the preliminary stage of jurisdiction’. That path is also the one which as I point out in my review of Buak, was followed by the Second (which includes President Lenaerts, the chair of conflict of laws at Leuven prior to my immediate predecessor, Hans van Houtte) and not the First Chamber:

The Second chamber (K. Lenaerts, A. Prechal, Toader, Rosas and Ilešič in Buak, focus on Sapir which was issued by the third Chamber, comprising at the time Toader (Rapporteur), Ilešič, Jarašiūnas, Ó Caoimh,  Fernlund. Toader and Ilešič are the common denominator with judment in BUAK. Sapir has focus also firstly on the legal relationship between the parties to the dispute, but secondly the basis and the detailed rules governing the bringing of the action (not: the to my knowledge never applied Eurocontrol criterion of ‘subject matter’ of the action).

At 66 the AG offers ‘pointers’ within the ‘nature of the legal relationship’ approach which he believes may be of assistance to any public power assessment:

‘(i) start with the legal relationship which characterises the dispute; (ii) assess it against the framework generally applicable to private parties; and (iii) establish whether the dispute arises from a unilateral exercise of public powers outside that normal private ‘reference framework’.’

which applied to the case at issue, he concludes at 87, leads to a finding of there not appearing to be an exercise of public powers.

I conclude my overview of ‘civil and commercial’ at para 2.65 of the third ed of the Handbook (forthcoming February 2021) with

the acte clair doctrine (meaning that national courts need not refer to the CJEU when the interpretation of EU law is sufficiently clear either by virtue of that law itself or following CJEU interpretation in case-law) implies that national courts by now ought to have been given plenty of markers when applying this condition of application of the Brussels I and Recast Regulation. Except of course the acte might not be that clair at all, as the above overview shows.

Bobek AG seems to have a similar end in mind: at 65: there is no unicorn, a truly autonomous interpretation of ‘civil and commercial’.

The Opinion continues with the classic themes of whether notaries are courts, and a firm opinion that leaving your car in a public parking space provokes contractual relations.

Geert.

European Private International Law, 3rd ed. 2021, paras 2.28 ff concluding at 2.65.

Groundhog day? Bobek AG this morning seems to think so: on the notion of 'civil and commercial' (and 'contract') in Brussels Ia, jurisdictional matters relating to a parking ticket enforced by notaries in Croatia. Again.
Obala v NLB https://t.co/N5aDJgTWfs pic.twitter.com/tEHROvHr4V

— Geert Van Calster (@GAVClaw) November 26, 2020

Federatie Nederlandse Vakbeweging
Liberté d'établissement
La directive concernant le détachement de travailleurs effectué dans le cadre d’une prestation de services est applicable aux prestations de services transnationales dans le secteur du transport routier

I am a bit late with a post as a follow-up to my Tweet, below, re the Supreme Court’s judgment in Highbury Poultry Farm Produce Ltd, R (on the application of) v Crown Prosecution Service [2020] UKSC 39. Thankfully, the judgment is of more than fleeting relevance. It is also a good example of the structured approach to legal argument, its discussion in scholarship and its engagement with the parties’ legal arguments which will be missed post Brexit.

A poultry slaughterhouse was being accused of breaching Regulation 1099/2009 on the protection of animals at the time of killing – the same Regulation at stake in the CJEU Shechita proceedings.

Core issue in the case is whether the EU law at issue implies a requirement for mens rea (criminal intent) in the ability for Member States to discipline its breach. If no means rea is required, the law is one of strict liability.

At 14 Lord Burrows makes the point that the Regulation at issue left it to the Member States to determine the sanctions rolled-out by national law to ensure compliance with the Regulation. Had a Member State decided to deploy civil sanctions only, that would have been fine: criminal law enforcement was not necessary. What follows is a good summary of the authority on means of UK and EU statutory interpretation, with in the case at issue particular emphasis on the impact of recitals: at 51: an unclear recital does not override a clear article.

Conclusion after consideration of the Regulation (the only stain on the analysis being the lack of linguistic input (a fleeting reference at 32 only), given the CILFIT authority on equal authenticity)): that all animals which have been stunned must be bled by incising at least one of the carotid arteries or the vessels from which they arise, is formulated by the Regulation as an obligation of strict liability under EU law. Hence its effet utile requires that Member States that opt for enforcing it via criminal law, employ strict liability in that enforcement.

Reference to the CJEU was neither sought nor seriously contemplated.

Geert.

 

UKSC upholds strict liability
No means rea required, for infringement of EU animal welfare provision Reg 1099/2009, a classic in cases involving stunning of animals
Important observations on requirement of effet utile when imposing criminal sanctions
No CJEU reference: acte clair https://t.co/zydLZUeYop

— Geert Van Calster (@GAVClaw) October 16, 2020

Thank you Jan Jakob Bornheim for alerting me to Hebei Huaneng v Deming Shi_B [2020] NZHC 2992, which dismissed the defendant’s application for summary judgment and discusses the notion of a ‘court’ , required to recognise its ‘judgments’ internationally. Readers will recognise the discussion ia from the CJEU case-law in judgments such as Pula Parking.

Hebei Huaneng had obtained judgment against Mr Shi at the Higher People’s Court of Hebei Province. The amount remained unsatisfied. Hebei Huaneng then found out that Mr Shi has assets in New Zealand – an inner-city apartment in Auckland and shares in a New Zealand company.  Mr Shi objects to New Zealand hearing this case on the basis that China does not have true courts and that Hebei Huaneng should first enforce its securities in China.

At 78-79 Bell J holds briefly that questions of real and substantial connection with New Zealand and appropriate forum are not much in issue. The two main arguments raised at this stage lie elsewhere.

Given the lack of treaty on the issue between NZ and PRC, he summarises the NZ common law on recognition at 16:  the common law regards a judgment of a foreign court as creating an obligation enforceable under New Zealand law if the judgment is given by a court, the judgment is final and conclusive, the judgment is for a definite sum, the parties are the same or privies, and the court had jurisdiction under New Zealand’s jurisdiction recognition rules. No merits review will be undertaken however refusal of enforcing a ‘money judgment’ is possible if obtained in breach of New Zealand standards of natural justice, enforcing the judgment would be contrary to public policy,
the judgment was obtained by fraud, the judgment was for a revenue debt, or the judgment involves the enforcement of a foreign penal law. Lack of reciprocal recognition by the other State is no objection.

On the issue of the notion of court, he notes at 29 that complaints that a foreign legal system is so defective that its courts cannot be trusted to do substantial justice may arise in two contexts: in forum non cases, where the analysis is prospective seeing as the case may not even be pending abroad; and in recognition cases, where the analysis is retrospective. At 28 Bell J already points out that style of writing etc. particularly also given the civil law background of China must not confuse. At 35 he notes to core issues viz the concept of court: (a) whether the bodies carrying out judicial functions are distinct from those with legislative and administrative function; and (b) whether the bodies carrying out judicial functions are subject to improper interference. Then follows lengthy-ish consideration of expert evidence to conclude at 60 that the good arguable case of the Chinese courts being independent, is satisfied.

The question of the ‘property security first’ principle’ which would mean satisfaction would first have to be sought against the Chinese secured assets, is discussed mostly in the context of Chinese law, against the backdrop of the common law principle of a party’s freedom to chose asset enforcement. The lex causae for that discussion I imagine will be further discussed at the merits stage.

A good case for the comparative conflicts binder.

Geert.

 

On the notion of 'court' and judicial independence re Chinese courts
Hebei Huaneng v Deming Shi_B [2020] NZHC 2992https://t.co/HwdiuYUnta https://t.co/wfsOjB2SLC

— Geert Van Calster (@GAVClaw) November 19, 2020

The Court of Justice (Grand Chamber) delivered on 24 November 2020 its judgment in case C‑59/19 (Wikingerhof GmbH & Co. KG v Booking.com BV), which is about an action seeking an injunction against commercial practices considered to be contrary to competition law:

“Point 2 of Article 7 of Regulation (EU) No 1215/2012 […] must be interpreted as applying to an action seeking an injunction against certain practices implemented in the context of the contractual relationship between the applicant and the defendant, based on an allegation of abuse of a dominant position by the latter in breach of competition law”.

Source: http://curia.europa.eu/juris/document/document.jsf;jsessionid=0B3C35184AED407DFB5B8CDCFD47AD38?text=&docid=234206&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=15723679

The CJEU held yesterday (Tuesday) in C-59/19 Wikingerhof v Booking.com. I reviewed the AG’s Opinion here. The case was held in Grand Chamber, which might have provoked expectations yet the judgment is not exactly a bang. Neither however can it be described a whimper. As I note in my review of the Opinion, the case in my view could have been held acte clair. The AG did take the opportunity in his Opinion to discuss many issues which the CJEU was bound not to entertain, at least not in as much detail as the AG did.

Let me first signal what I believe might be the biggest take-away of the litigation, if at least the referring court is followed. That is the Bundesgerichtshof’s finding that  there is no durable record of the alleged consent by Wikingerhof of the amended GTCs, including choice of court, effected via amendments on the ‘Extranet’, which is the portal via which the hotel may update its information and retrieve reservations. Booking.com claimed these amounted to a ‘form which accords with practices which the parties have established between themselves’ pursuant to Article 25(1)(b). Parties will still argue on the merits whether the initial consent to the primary GTCs was strong-armed because of booking.com’s dominant position.

With respect to to the jurisdictional issue, the CJEU in a succinct judgment firstly points to the need for restrictive interpretation. It points at 29 to the claimant being the trigger of A7(1) or (2). Without a claimant’s decision to base a claim on the Articles, they simply do not get to be engaged. That is a reference to the forum shopping discussion of the AG. Still, the court hearing the action must assess whether the specific conditions laid down by those provisions are  met.

At 32, with reference to Brogsitter, ‘an action concerns matters relating to a contract within the meaning of [A7(1)(a) BIa] if the interpretation of the contract between the defendant and the applicant appears indispensable to establish the lawful or, on the contrary, unlawful nature of the conduct complained of against the former by the latter’.  ‘That is in particular the case of an action based on the terms of a contract or on rules of law which are applicable by reason of that contract’ (reference to Holterman and to Kareda, with the latter itself referring to De Bloos). At 33  ‘By contrast, where the applicant relies, in its application, on rules of liability in tort, delict or quasi-delict, namely breach of an obligation imposed by law, and where it does not appear indispensable to examine the content of the contract concluded with the defendant in order to assess whether the conduct of which the latter is accused is lawful or unlawful, since that obligation applies to the defendant independently of that contract, the cause of the action is a matter relating to tort, delict or quasi-delict’.

At 32 therefore the CJEU would seem to confirm De Bloos’ awkward (given the Regulation’s attention to predictability) support for forum shopping based on claim formulation yet corrected by what is more akin to Sharpston AG’s approach in Ergo and the Court’s approach in Apple v eBizcuss, a judgment not referred in current judgment: namely that the judge will have to consider whether contractual interpretation is strictly necessary (the Court uses ‘indispensable’) to judge the case on the merits. Here, Wikingerhof rely on statutory German competition law (at 34-36): therefore the claim is one covered by Article 7(2).

The judgment confirms the now very fine thread between jurisdictional and merits review for the purposes of tort-based litigation between two contracting parties.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.2, Heading 2.2.11.2.9. 3rd ed. 2021 para 2.469.

 

The EU “Parliament today endorsed a new law that will allow groups of consumers to join forces and launch collective action in the EU. […] All member states must put in place at least one effective procedural mechanism that allows qualified entities (e.g. consumer organisations or public bodies) to bring lawsuits to court for the purpose of injunction (ceasing or prohibiting) or redress (compensation). […]

More rights for consumers and safeguards for traders

The European class action model will allow only qualified entities, such as consumer organisations, to represent groups of consumers and bring lawsuits to court, instead of law firms.

In order to bring cross-border actions to court, qualified entities will have to comply with the same criteria across the EU. They will have to prove that they have a certain degree of stability and be able to demonstrate their public activity, and that they are a non-profit organisation. For domestic actions, entities will have to fulfil the criteria set out in national laws.

The rules also introduce strong safeguards against abusive lawsuits by using the “loser pays principle”, which ensures that the defeated party pays the costs of the proceedings of the successful party.

To further prevent representative actions from being misused, punitive damages should be avoided. Qualified entities should also establish procedures to avoid conflict of interest and external influence, namely if they are funded by a third party.

Collective actions can be brought against traders if they have allegedly violated EU law in a broad range of areas such as data protection, travel and tourism, financial services, energy and telecommunication.

Finally, the directive also covers infringements that have stopped before the representative action is brought or concluded, since the practice might still need to be banned to prevent it from recurring.

[…]

Next steps

The directive will enter into force 20 days following its publication in the Official Journal of the EU. Member states will then have 24 months to transpose the directive into their national laws, and an additional six months to apply it. The new rules will apply to representative actions brought on or after its date of application”.

Source: https://www.europarl.europa.eu/news/en/press-room/20201120IPR92116/

Openbaar Ministerie (Faux en écritures)
Espace de liberté, sécurité et justice
Les procureurs aux Pays-Bas ne constituent pas une « autorité judiciaire d’exécution » dans le cadre de l’exécution d’un mandat d’arrêt européen, étant donné qu’ils sont susceptibles d’être soumis à des instructions individuelles de la part du ministre de la Justice néerlandais

Wikingerhof
Espace de liberté, sécurité et justice
Un hôtel utilisant la plate-forme Booking.com peut en principe attraire celle-ci devant une juridiction de l’État membre dans lequel cet hôtel est établi pour faire cesser un éventuel abus de position dominante

Minister van Buitenlandse Zaken
Espace de liberté, sécurité et justice
Un État membre qui prend une décision de refus de visa « Schengen », en raison d’une objection émise par un autre État membre, doit identifier, dans cette décision, l’État membre concerné ainsi que le motif de refus spécifique basé sur cette objection, accompagné, le cas échéant, des raisons de cette objection