Conflictoflaws

Written by Mayela Celis – The comments below are based on the author’s doctoral thesis entitled “The Child Abduction Convention – four decades of evolutive interpretation” at UNED

As mentioned in a previous post, after many years in the making, the Guide to Good Practice on the grave-risk exception (Article 13(1)(b)) under the Child Abduction Convention (grave-risk exception Guide or Guide) has been published. Please refer to our previous posts here and here. This Guide to Good Practice deals with a very controversial topic indeed. The finalisation and approval of this Guide is without a doubt a milestone and thus, this Guide will be of great benefit to users.

For ease of reference, I include the relevant provision dealt with in the Guide. Article 13(1)(b) of the Child Abduction Convention sets out the following: “Notwithstanding the provisions of the preceding Article, the judicial or administrative authority of the requested State is not bound to order the return of the child if the person, institution or other body which opposes its return establishes that – […] b) there is a grave risk that his or her return would expose the child to physical or psychological harm or otherwise place the child in an intolerable situation. […]” (our emphasis).

The comments on the grave-risk exception Guide will be divided into two posts. In the present post, I will analyse the Guide exclusively through the lens of human rights. In the second post, I will comment on some specific legal issues of the Guide but will also touch upon on some aspects of human rights law. These posts reflect only my personal opinion. Given the controversial nature of this topic, there might be other different and valid opinions out there so please bear that in mind.

At the outset, it should be noted that this Guide is only advisory in nature and thus nothing in the Guide may be construed as binding upon Contracting Parties to the 1980 Convention (and any other HCCH Convention) and their courts (paras 7 and 8 of the Guide) Therefore, courts have enough leeway to supplement it and take on board what they see fit.

Human rights law is gaining importance every day, also in private international law cases. However, apart from some fleeting references to the United Nations Convention on the Rights of the Child (pp. 16 and 56), there are no references to human rights case law in the Guide. Indeed, the increasing number of judgments of the European Court of Human Rights (ECtHR) is not mentioned in the Guide, even though dozens of these judgments have dealt with the grave-risk exception (Art. 13(1)(b)) under the Child Abduction Convention; thus there appears to be an “elephant in the room”. We will try to respond in this post to the following questions: what has been the contribution of the ECtHR on this topic and what are the possible consequences of the absence of references to human rights case law in the Guide.

In this regard, I refer readers to our previous post regarding the interaction of human rights and the Child Abduction Convention here and my article entitled: The controversial role of the ECtHR in the interpretation of the Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction, with special reference to Neulinger and Shuruk v. Switzerland and X v. Latvia (in Spanish only but with abstracts in English and Portuguese in the Anuario Colombiano de Derecho Internacional). To view it, click on “Ver artículo – descargar artículo”, currently pre-print version, published online in March 2020.

Before going into the substance of this post, it is perhaps important to clarify why the case law of the ECtHR in child abduction matters is of such great importance in Europe and beyond, perhaps for the benefit of our non-European readers. First, in addition to being binding upon 47 States party to the European Convention on Human Rights, which represent about half of the total number of Contracting Parties to the Child Abduction Convention (45%), the case law of the ECtHR not only applies to child abduction cases between European States. It will also apply, for example, if the requested State in child abduction proceedings is a party to the European Convention on Human Rights and the requesting State is not. Indeed, the geographical location of the requesting State and whether it is a party to the European Convention on Human Rights are not relevant. See for example, Neulinger and Shuruk v. Switzerland (Application No. 41615/07), Grand Chamber, where the requesting State was Israel, and X v. Latvia (Application No. 27853/09), Grand Chamber, where the requesting State was Australia, both of which are not a party to the European Convention. Secondly, not only European citizens can launch proceedings before the ECtHR. All of this is nicely summarised in Article 1 of the European Convention on Human Rights, which sets out that “The High Contracting Parties shall secure to everyone within their jurisdiction the rights and freedoms defined in Section I of this Convention” (our emphasis).

In X v. Latvia, the Grand Chamber of the ECtHR has established a legal standard in the handling of child abduction cases where the 13(1)(b) exception has been raised (and indeed other exceptions of the Child Abduction Convention such as Articles 12, 13(1)(a), 13(2) and 20), which is the following:

“106. The Court [ECtHR] considers that a harmonious interpretation of the European Convention and the Hague Convention (see paragraph 94 above) can be achieved provided that the following two conditions are observed. Firstly, the factors capable of constituting an exception to the child’s immediate return in application of Articles 12, 13 and 20 of the Hague Convention, particularly where they are raised by one of the parties to the proceedings, must genuinely be taken into account by the requested court. That court must then make a decision that is sufficiently reasoned on this point, in order to enable the Court to verify that those questions have been effectively examined. Secondly, these factors must be evaluated in the light of Article 8 of the Convention (see Neulinger and Shuruk, cited above, § 133).” (our empahsis)

[…]

“118. As to the need to comply with the short time-limits laid down by the Hague Convention and referred to by the Riga Regional Court in its reasoning (see paragraph 25 above), the Court reiterates that while Article 11 of the Hague Convention does indeed provide that the judicial authorities must act expeditiously, this does not exonerate them from the duty to undertake an effective examination of allegations made by a party on the basis of one of the exceptions expressly provided for, namely Article 13 (b) in this case.” (our emphasis)

In addition, the ECtHR indicates that domestic courts must conduct “meaningful checks” to determine whether a grave risk exists (paragraph 116 of X v. Latvia), and to do so a court may obtain evidence on its own motion if for example, this is allowed under its internal law.

Importantly, this case also underlines the need to secure “tangible” measures of protection for the return of the child (paragraph 108 of X v. Latvia).

Moreover, there are at least two issues in the Guide that could have benefited from a human rights analysis, namely the incarceration of (mainly) the abducting mother upon returning the child to the State of habitual residence and the separation of siblings.

With regard to the first issue, it should be noted that the fact that the mother will be incarcerated upon returning the child to the State of habitual residence could have serious consequences for the child. The Guide has correctly explained the different ways in which such an outcome could be avoided. However, the Guide concludes with the following: “The fact that the charges or the warrant cannot be withdrawn is generally not sufficient to engage the grave risk exception” (paragraph 67).

In my view, where objective reasons have been raised by the mother to refuse to return to the State of habitual residence, such as incarceration, there should be a human rights analysis in the light of Article 8 of the European Convention on Human Rights. While there might be some cases where incarceration may not be sufficient to refuse a return, there might be other cases were this would place the taking parent and the child in grave risk of harm or intolerable situation. By way of example, objective reasons for not returning could include a long incarceration or a disproportionate sanction, the fact the other parent cannot take care of the child upon the incarceration of the other parent, the inability to contest custody while imprisoned, etc. According to the ECtHR, an analysis should be undertaken as to whether these actions are necessary in a “democratic society”. Accordingly, the decision of the mother not to return based on a whim should not be considered seriously. See, for example, the ECtHR cases, Neuliger and Shuruk v. Switzerland (Application No. 41615/07), Grand Chamber (as clarified by X v. Latvia (Application No. 27853/09), Grand Chamber)), and B. c. Belgique (Requête No. 4320/11). Arresting and handcuffing the mother at the airport has undoubtedly a tremendous impact on children; so all efforts should be geared via judicial co-operation and direct judicial communications to make sure that charges are dropped as mentioned in the Guide (first part of paragraph 67 of the Guide).

As regards the second scenario, it is important to note that the separation of siblings when one of them has successfully objected to being return under Article 13(2) under the Child Abduction Convention may inflict harm on the children and may be difficult to enforce. The Guide noted that every child should be considered individually and concluded that “Consequently, the separation of the siblings resulting from the non-return of one child (regardless of the legal basis for the non-return) does not usually result in a grave risk determination for the other child” (paragraph 74).

According to article 12 of the UN Convention on the Rights of the Child, the views of the child should be given due weight in accordance with the age and maturity of the child. By ordering the return of usually the younger sibling(s) and forcing the mother to make a choice between returning with one child and staying with the child who objected, a judge could not be giving enough weight to the views of the child objecting to being returned. This is especially the case when we are dealing with full siblings and all are subject to return proceedings. In my view, and given that the reason for not returning are the views, in particular, of the older child, this should be factored in when the judge exercises his or her discretion.  See, for example, the ECtHR case, M.K. c. Grèce (Requête n° 51312/16). Obviously, if the separation of siblings is due to the action of the mother by not wanting to return, then a separation of the siblings would most likely not be a ground for refusing the return.

The underlying basis of the above is that the Child Abduction Convention is for the protection of children and not to vindicate the position of adults who are immersed in a legal battle or to merely sanction the abductor.

The standard in X v. Latvia should be kept in mind when dealing with international child abduction cases. Given that the grave-risk exception Guide is silent on this, practitioners would need to supplement the Guide with relevant literature and case law on human rights if they are dealing with a case in Europe. Practitioners outside Europe having a child abduction case which is being resolved in Europe may need to do the same in order to know what their possibilities of success and options are.

In this day and age, and as mentioned by the honorable Eduardo Vio Grossi, judge of the Inter-American Court of Human Rights, in a recent virtual forum (“Challenges to Inter-American Law”), the focus should not only be on sanctioning States for violations of human rights but we should assist States in not getting sanctioned by providing the necessary guidance and if possible, paving the way.

Before a court of a Member State of enforcement, a debtor lodges an application opposing enforcement of a maintenance decision given by a court of another Member State. The court of the Member State of enforcement asks the Court of Justice whether that application falls within the scope of the Maintenance Regulation or that of Brussels I bis Regulation and whether the jurisdiction to rule on the application lies with the courts of the Member State of enforcement.

In essence, these are the questions at stake in the case C-41/19, FX. Back in February, we reported on the Opinion of AG Bobek presented in this case.

In its Judgment of 4 June 2020, the Court follows its Advocate General to a large extent and considers that an application opposing enforcement, which has a close link with the procedure for enforcement, falls within the scope of the Maintenance Regulation and is within the international jurisdiction of the courts of the Member State of enforcement.

First, at paragraphs 31 to 33 of that Judgment, it is observed that the Maintenance Regulation is an instrument governing, inter alia, enforcement of decisions of the courts of the Member States in matters relating to maintenance obligations, these matters being excluded from the Brussels I bis Regulation pursuant to its Article 1(2)(e). As such, the Regulation covers the proceedings on enforcement of a maintenance decision.

Next, at paragraph 35, it is stated that when an application opposing enforcement is connected with an action seeking enforcement of a decision in matters relating to maintenance obligations, it falls within the scope of the Maintenance Regulation, just as that decision itself.

After that, at paragraphs 36 to 42, the Court tackles the question whether the courts of the Members State of enforcement have jurisdiction to rule on such application opposing enforcement. In contrast to the Brussels I bis Regulation and its Article 24(5), the Maintenance Regulation does not contain a provision explicitly concerning jurisdiction at the stage of enforcement. Nevertheless, the Court considers that a court of the Member State of enforcement has jurisdiction under the Maintenance Regulation to adjudicate on an application opposing enforcement where that application has a close link with the action for enforcement brought before it.

While both the Opinion and the Judgments seem to come the conclusion that the Maintenance Regulation contains an implicit rule on jurisdiction at the stage of enforcement that is inherent in the system of that regulation (see point 43 of the Opinion; paragraphs 36 and 38 of the Judgment), the reasonings backing that conclusion seem to differ at least in some aspects.

At point 44 et seq. of his Opinion, AG Bobek argued mainly that a rule according to which international jurisdiction for enforcement belongs to the courts of the Member State where enforcement is sought is ‘an expression of what could be considered a general principle of international law connected with State sovereignty’. Therefore, according to the Advocate General, it is not necessary to have recourse to Article 24(5) of the Brussels I bis Regulation as a supplementary provision in order to be able to establish that the courts of the Member State of enforcement also have jurisdiction with regard to the enforcement of maintenance decisions within the scope of the Maintenance Regulation.

In its Judgment, the Court does not reproduce the aforementioned argument. At paragraphs 37 et seq., it rather infers an implicit rule on jurisdiction from the structure and objectives of the Maintenance Regulation. While doing so, it seems to rely on the idea that, jurisdiction-wise, the procedures closely linked to the enforcement, such as the opposition against it, should not be disconnected from the enforcement itself.

Finally, at paragraphs 44 et seq., the Judgment provides some guidance on interpreting the Maintenance Regulation which may be of assistance to the referring court in connection with a ground of opposition relating to the satisfaction of the debt.

Written by María Barral Martínez, a former trainee at the European Court of Justice (Chambers of AG Campos Sánchez-Bordona) and an alumna of the University of Amsterdam and the University of Santiago de Compostela

The Hoge Raad Neederlanden (The Dutch Supreme Court), the referring court in the case Supreme Site Service and Others, C-186/19, harbours doubts regarding the international jurisdiction of Dutch courts under the Brussels I bis Regulation, in respect to a request to lift an interim garnishee order. An insight on the background of the case can be found here and here, while the implications of that background for admissibility of request for a preliminary ruling are addressed in section 1 of the present text.

In replying to a preliminary ruling request made by that court, AG Saugmandsgaard Øe issued his Opinion. Advocate General concluded that a flexible approach should be taken when interpreting the concept of “civil and commercial matters” within the meaning of Article 1(1) of the Brussels I bis Regulation. AG was of the view that an action for interim measures as the one brought by SHAPE, aimed at obtaining the lifting of a garnishee order, qualifies as civil and commercial matters, within the meaning of Article 1(1), provided that such garnishee order had the purpose of safeguarding a right originating in a contractual legal relationship which is not characterised by an expression of public powers, a matter that is left to the referring court to verify. For presentation of AG reasoning and its analysis in relation to interim measures, see section 2.

Moreover, according to AG, alleged claims of immunity enjoyed under international law by one of the parties to the proceedings had no significance, when it comes to the analysis of the material scope of the Brussels I bis Regulation. Against this background, the case provides a good opportunity to explore jurisdictional issues in the face of immunities, such as the debate regarding international jurisdiction preceding the assessment of immunities, and what can be inferred from the case-law of the Court of Justice and the European Court of Human Rights in that respect. Next, it requires us to determine whether the case-law developed in relation to State bodies and their engagement in acta iure imperii can be applied mutatis mutandis to the international organisations. Finally, it revives the concerns on whether the scope of the Brussels I bis Regulation should be determined in a manner allowing to establish international jurisdiction under that Regulation even though enforcement against public authorities stands little chances, be that international organisations as in the present case. These issues are discussed in section 3.

1.     Admissibility of the preliminary reference

Advocate General Saugmandsgaard Øe made some remarks on the admissibility of the preliminary ruling and on whether a reply of the Court of Justice would be of any avail to the referring court.

It should be recalled that at national level, two sets of proceedings were initiated in parallel. In the first set, – the proceedings on the merits – Supreme, the private-law companies, sought a declaratory judgment that it was entitled to the payment of several amounts by SHAPE, an international organisation. These proceedings were under appeal before the Den Bosch Court of Appeal because SHAPE challenged the first instance court’s jurisdiction. In the second set – the proceedings for interim measures where the preliminary ruling originated from – SHAPE brought an action seeking the lift of the interim garnishee order and requesting the prohibition of further attempts from Supreme to levy an interim garnishee order against the escrow account.

In the opinion of AG, the preliminary ruling was still admissible despite the fact that the Den Bosch Court of Appeal ruled on the proceedings on the merits granting immunity of jurisdiction to SHAPE in December 2019 – the judgment is under appeal before the Dutch Supreme Court. He opined that the main proceedings should not be regarded as having become devoid of purpose until the court renders a final judgment on the question whether SHAPE is entitled to invoke its immunity from jurisdiction, in the context of the proceedings on the merits and whether that immunity, in itself, precludes further garnishee orders targeting the escrow account (point 35).

2.     Civil and commercial matters in respect of substantive proceedings or interim relief proceedings?

The Opinion addressed at the outset the question on whether the substantive proceedings should fall under the material scope of the Brussels I bis Regulation in order for the interim relief measures to fall as well within that scope. As a reminder, the object of the proceedings on the merits, is a contractual dispute over the payment of fuels supplied by Supreme to SHAPE, in the context of a military operation carried out by the latter.

As AG signalled, to answer the question several hypotheses have been put forward by the parties at the hearing held at the Court of Justice. The first hypothesis, supported by the Greek Government and Supreme, proposed that in order to determine if an action for interim measures falls within the scope of the Regulation, the proceedings on the merits should fall as well under the material scope of the Regulation. In particular, the characteristics of the proceedings on the merits should be taken into account. The second hypothesis, supported by SHAPE, considered that the analysis should be done solely in respect to the proceedings for interim measures. The European Commission and the Dutch and Belgian Governments opined that in order to determine if the action for interim measures can be characterised as civil and commercial matters, it is the nature of the right which the interim measure was intended to safeguard in the framework of the interim relief proceedings that matters.

Endorsing the latter hypothesis, AG indicated that an application for interim measures cannot be regarded as automatically falling within or outside the scope of the Brussels I bis Regulation, depending on whether or not the proceedings on the merits fall within that scope, simply because it is ancillary to the proceedings on the merits (point 51). To support his conclusion, AG followed the line of reasoning developed by the Court in the context of the instruments preceding the Brussels I bis Regulation. In that regard, the Court has held that to ascertain that provisional/protective measures come within the scope of the Regulation, it’s not the nature of the measures that should be taken into account but the nature of the rights they serve to protect. To illustrate this: in Cavel I, the Court held that interim measures can serve to safeguard a variety of rights which may or may not fall within the scope of the now Brussels I bis Regulation (then the Brussels Convention) depending on the nature of the rights which they serve to protect. This has been confirmed in Cavel II: “ancillary claims accordingly come within the scope of the Convention according to the subject-matter with which they are concerned and not according to the subject-matter involved in the principal claim”. Further, in Van Uden, the Court held that “provisional measures are not in principle ancillary to arbitration proceedings but are ordered in parallel to such proceedings and are intended as measures of support. They concern not arbitration as such but the protection of a wide variety of rights”. This case-law has been also confirmed in recent judgments of the Court, namely in Bohez – where a penalty payment was imposed as a measure to comply with the main judgment – and Realchemie Nederland concerning an action brought for alleged patent infringement in the context of interim proceedings, where a prohibition in the form of payment of a fine was ordered.

In brief, what matters in this discussion on interim measures falling or not within the scope of the Brussels I bis Regulation, is not the relation between the main proceedings and the interim measures, the crucial factor being the purpose – determined from a procedural law standpoint – of the interim relief measure vis-à-vis the proceedings on the merits: an interim measure falling within the scope of the Regulation has to safeguard the substantive rights at stake in the main proceedings. In the present case, the substantive right in question is a credit arising from a contractual obligation that Supreme holds against SHAPE.

3.     Whether immunities play a role in determining if an action can qualify as “civil and commercial matters” within the meaning of Article 1(1) of the Regulation

One of the particularities of the case is that in the second set of proceedings where the preliminary ruling originated, SHAPE and JFCB (NATO) have introduced an action for interim relief measures, based on immunity from execution. SHAPE alleged that its immunity from execution flowing from the 1952 Paris Protocol trumps any jurisdiction derived from that Regulation.

It is against this background that the Dutch Supreme Court asked the Court of Justice if the fact that an International Organisation claims to enjoy immunity from execution under public international law, bars the application of the Brussels I bis Regulation or has an impact on its application ratione materiae. In his Opinion, Advocate General considered that the referring court is concerned by the actions relating to “acts or omissions in the exercise of state authority” linked to the concept of “acta iure imperii” – a concept which is also used in international law in relation to the principle of State immunity.

The Opinion tackled the question of immunities under public international law and concluded that a dispute where an International Organisation is a party, should not be automatically excluded from the material scope of the Brussels I bis Regulation. Interestingly, some aspects of the reasoning that allowed to reach that conclusion echo the doctrinal debates on the interplay between the jurisdictional rules of EU private international law, on the one hand, and the immunity derived from public international law, on the other hand.

• Does immunity precede the jurisdiction under EU PIL?

At point 72, AG rejected the arguments advanced by the Austrian Government, who argued that the Brussels I bis Regulation should not apply to the case at hand. In the view of this government, if an international organisation takes part in a dispute, the immunity that this organisation enjoys on the basis of customary international law or treaty law, characterizes the nature of the legal relationship between the parties. In other words, a criterion based on the nature of a party (scil. the fact that it is an international organization that is a party to proceedings) should suffice to decline jurisdiction under the Brussels I regime.

In that respect, AG made some interesting remarks: first, by applying the Brussels I bis Regulation to a dispute where an International Organisation is a party, there is no breach of Article 3(5) TUE and of the obligation to respect public international law enshrined in that provision. Second, if, based on the Brussels I bis regime, a national court declares its international jurisdiction over a dispute,  potential immunity claims advance by the parties will not be affected, as they are to be considered at a later stage of the proceedings. AG departed from the premise that the assessment on immunities should take place after the national judge seised with the case looks into the substance of the merits, including party allegations. This is therefore, at a second stage, after the national court has decided over its international jurisdiction within the first stage, that the immunity needs to be ascertained and its limits set (point 69).

This approach resonates with the idea that national courts are not supposed to engage in an in-depth analysis of the substance at that very first stage, when they are determining their own jurisdiction. They should not be undertaking a mini-trial, ascertaining jurisdiction requires only a first approximation to the facts of the case, solely for the purpose of determining jurisdiction. In FlyLaL II, a case concerning jurisdictional issues pursuant to the Brussels I Regulation, in respect of an action for damages brought for infringement of competition law, the Court observed that at the stage of determining jurisdiction “the referring court must confine itself to a prima facie examination of the case without examining its substance”. The statement draws on AG Bobek’s Opinion presented in the aforementioned case: “[d]etermination of jurisdiction should be as swift and easy as possible. Thus, a jurisdictional assessment is by definition a prima facie one. […] The jurisdictional assessment will, in practice, require a review of the basic factual and legal characteristics of the case at an abstract level.”

From the ECtHR case-law (see, most notably, Waite and Kennedy v. Germany) dealing with immunities of international organizations and the right to a remedy enshrined in Article 6 ECHR, a similar reading can be extracted. National courts deciding on granting of an immunity – be [it] immunity of jurisdiction or from execution – and performing the “reasonable alternative means” test, inevitably engage in a substantive analysis of the merits. To ensure that the claimant’s right to access justice is not breached, requires more than an abstract examination of the facts. This would seem to favour the idea that determination of international jurisdiction precedes a substantive analysis of the circumstances of the case in respect to any alleged claim of immunities made by the parties.

However, it is still not clear how this reasoning can be reconciled with judgments of the Court of Justice in the cases Universal Music International Holding and Kolassa. There, the Court of Justice held that according to the objective of the sound administration of justice which underlies the Brussels I Regulation, and respect for the independence of the national court in the exercise of its functions, a national court in the framework of ascertaining its international jurisdiction pursuant to the Brussels I regime, must look at all the information available to it. Although such an assertion seems to be construed in very general terms, one may well wonder what exactly a court assessing its international jurisdiction under the Brussels I bis Regulation is required to look at. Should it be a minimal review of the substance or a prima facie analysis strictly focused on the nature of the elements of the action – relevant in the context of the connecting factors used by the rules on jurisdiction –,including all the information available before the court?

If the answer would be the latter, that means that in the case at hand, the immunity from execution relied on by SHAPE in support of its action should be taken into account.

A reading of paragraphs 53 to 58 in the Court of Justice’s recent judgment in Rina, hints that in order to establish its own jurisdiction under the Brussels I bis Regulation, a national court has to take into consideration all available information. In the case at issue, party allegations where a party (Rina) invokes immunity of jurisdiction. While at first glance this instruction does not steer away from the judgments in Universal Music International Holding and Kolassa, what the Court proposes here is definitely more complex than a first approximation to the facts of the case. At paragraph 55 the Court notes “a national court implementing EU law in applying [the Brussels I Regulation] must comply with the requirements flowing from Article 47 of the Charter. […] The referring court must satisfy itself that, if it upheld the plea relating to immunity from jurisdiction, [the claimants] would not be deprived of their right of access to the courts, which is one of the elements of the right to effective judicial protection in Article 47 of the Charter.” If the national courts were to engage in such analysis – in a similar fashion as the ECtHR established in regards to Article 6 ECHR – it will certainly go beyond a mere examination in abstracto, implying rather a deep dive on the merits.

Moreover, the judgment in Rina seems to suggest that the analysis of international law cannot be avoided even when it comes only to the question whether the Brussels I regime applies or not. At paragraph 60, the Court of Justice explained “[t]he principle of customary international law concerning immunity from jurisdiction does not preclude the national court seised from exercising the jurisdiction provided for by that regulation in a dispute relating to such an action, where that court finds that such corporations have not had recourse to public powers within the meaning of international law.” Again, for the examination of these matters in the framework of determining international jurisdiction, a greater level of scrutiny is required. A national judge would have to dig dipper in the facts and party allegations to come to the conclusion that a certain party did not have recourse to public powers. Something that is everything but a swift and easy exercise.

• Does the case-law developed in the context of State bodies apply to international organisations?

Be that as it may, while an immunity claim does not automatically rule out the application of the Brussels I bis Regulation according to AG Saugmandsgaard Øe, the key question in his analysis is to determine if actions related to acta iure imperii under Article 1(1) of the Regulation are applicable to international organisations. It flows from the Court of Justice well-settled case-law that disputes between a State body and a person governed by private law come within the scope of civil and commercial matters, if the public authority in question does not act in the exercise of its public powers. At point 75 of his Opinion, AG made a reference to the judgment in Eurocontrol and indicated that exceptions under Article 1(1) in fine can extend to acts and omissions carried out by an international organisation. He remarked that, the concept of “public powers” established under the Court’s case-law, not only relates to State responsibility but refers also to those situations where a public authority acts under the umbrella of its public powers.

Advocate General moved then to analyse the Court of Justice case-law concerning liability of the State for acts and omissions carried out in the exercise of sovereign authority. Here matters get a bit complicated.

On the one hand, it remains to be seen how that case-law could be applied mutatis mutandis to international organisations. Leaving aside the question of immunities and putting emphasis on the notion of “civil and commercial matters” within the meaning of Article 1(1) of the Brussels I bis Regulation, the acts and omissions of an international organization are strictly connected with the powers conferred to the organisation for its proper functioning. Thus, one could wonder whether a functional test would be more suitable to determine if the acts or omissions were carried out by an international organization in the exercise of its public powers: a demarcating line could be drawn between non-official (non-related to the mission of the organization) acts and omissions and those of official nature, therefore necessary to fulfil the organisation’s mandate.

On the other hand, concerning the criteria applied by the Court when analysing if a public authority has exercised its powers of State authority, there is no “one size fits all” solution. As AG rightly pointed out at point 84 of his Opinion, the Court has still to sort out the interplay between different criteria: matters characterising the legal relationship between the parties, the subject-matter of the dispute and the basis of the action and the detailed rules governing the action brought.

To illustrate this point: in Préservatrice Foncière TIARD, the Court looked mainly at the legal relationship between the parties, while in Baten and Sapir and Others the Court did not refer to the legal relationship between the parties but focused on the subject-matter of the dispute and the basis of the action brought. Hence, the alternative or cumulative use of these criteria – or a flexible one- seem to reflect the need to provide an adequate response to the case-specific factual context of a particular case.

In that sense, AG pointed out that the criterion concerning the basis of the action is not relevant in all cases, it will be determinant in situations where is not established that the substantive basis of the claim is an act carried out in the exercise of public powers. For that reason, at 90, AG considered more appropriate that the action is based on a right originating from an act of public authority or in a legal relationship characterized by a manifestation of public power.

• Does the perspective of anticipated recognition/enforcement influence the interpretation of the notion of “civil and commercial matters”?

It is worth mentioning that some commentators (see also Van Calster, G., European Private International Law, Hart Publishing, 2016, p. 32) pointed out that, in the light of the judgment in Eurocontrol, the scope of application of the Brussels I bis Regulation should be interpreted by taking into account the perspectives of recognition and enforcement. Thus, if immunity bears no significance at the stage of determining jurisdiction, but it is later granted/recognised resulting in refusal of recognition and/or enforcement, concerns are raised regarding what is the practical use of exercising jurisdiction under the Brussels I bis Regulation against public authorities when there are little chances of recognition/enforcement.

On this point, the Spanish Supreme Court – in a case concerning the enforcement of a judgment rendered in Germany in favour of a private party against the Republic of Argentina –, held that a declaration of enforceability issued in relation to a general enforcement order does not breach the rules on immunity of execution. The Spanish Court precised that only when specific legal attachment measures are taken, a court should determine if the property in question is subject to execution. Thus, the issue of immunity of execution and the assessment whether the property to be executed is for commercial or official purposes would be at stake at a second stage of the enforcement procedure, not interfering with the application of the Brussels I regime.

 

 

Prof. Fabrizio Marrella (“Cà Foscari” University of Venice) has recently published the second edition of his textbook on international business law: “Manuale di diritto del commercio internazionale” (CEDAM, 2020), with a foreword of Prof. Andrea Giardina. A presentation has been kindly provided by the author (the complete TOC is available on the publisher’s website):

The Second Edition of this reference textbook (the first and foremost in the Italian language) combines the best aspects of a conceptual, systemic approach and a practical approach. It provides a rigorous and well grounded intellectual framework for understanding the most significant contractual and regulatory issues in international business law. The new edition has been revised and updated to take into account Incoterms 2020 as well as new issues of sales, transport and insurance law, payments and bank guarantees. All aspects of private international law are developed in view of their application in an arbitration or State court context.

Title: F. Marrella, “Manuale di diritto del commercio internazionale”, Padua, CEDAM, 2020.

ISBN: 9788813373672. Pages: 936. Available at CEDAM.

The Future of the Law of Contract brings together an impressive collection of essays on contract law. Taking a comparative approach, the aim of the book is to address how the law of contract will develop over the next 25 years, as well as considering the ways in which changes to the way that contracts are made will affect the law.

Topics include good faith; objectivity; exclusion clauses; economic duress; variation of contract; contract and privacy law in a digital environment; technological change; choice of court agreements; and Islamic finance contracts.

The chapters are written by leading academics from England, Australia, Canada, the United States, Singapore and Malaysia. As such, this collection will be of global interest and importance to professionals, academics and students of contract law.

 

Table of Contents

1. An Overview

Michael Furmston

2. The Implied Obligation of Good Faith

Howard Hunter

3. Good Faith and the Supreme Court of Canada

Stephen Waddams

4. The Quagmire of Utmost Good Faith in Insurance Law: A Comparative Study of Malaysian, Australian, and English Laws in Consumer Insurance Contracts

Cheah You Sum

5. Objectivity

J. W. Carter and Michael Furmston

6. Automated Transactions and the Law of Contract: When Codes are Not Congruent

Roger Brownsword

7. The Resilience of Contract Law in Light of Technological Change

Eliza Mik

8. A Collision of Contract and Privacy Law in a Digital Environment—An Accident Waiting to Happen! A Comparative Study

Cirami Mastura Drahaman

9. Setting Out a Comprehensive Legal Framework to Govern Exclusion Clauses in Malaysia: Lessons from the United Kingdom and Australia

Loganathan Krishnan

10. Economic Duress: Present State and Future Development: England, Australia and Malaysia

Sri Bala Murugan

11. The Validity of Choice of Court Agreements in International Commercial Contracts Under the Hague Choice of Court Convention and the Brussels Ia Regulation

Mukarrum Ahmed

12. De-Identification of Islamic Finance Contracts by the Common Law Courts

Adnan Trakic

 

Professor Michael Furmston is an internationally–acknowledged authority on contract and commercial law. The author of the leading textbook Cheshire Fifoot & Furmston on Contract (17th edition 2017) and Editor of the Construction Law Reports, volumes 1-150, his published work extends to over 20 books and many dozens of articles, chapters and other contributions.

An eminent academic, he has taught at Oxford, where he was a Fellow of Lincoln College; at Bristol, where he was Dean of the Faculty of Law and Pro Vice Chancellor; and also at other institutions of international standing. He was appointed Emeritus Professor at Bristol in 1998 and Dean and Professor at Singapore Management University’s School of Law.

Professor Furmston was called to the English Bar in 1960 (Gray’s Inn) and has been a Bencher of Gray’s Inn since 1989. He appeared in the House of Lords in Ruxley Electronics and Construction Ltd v Forsyth on the measure of damages for defective construction and has acted as consultant to many clients, owners, contractors and consultants on commercial and construction law.

On 10–11 October 2019, the Albert-Ludwig-University of Freiburg (Germany) hosted the final conference of the German branch in the framework of the research project “Informed Choices in Cross-Border Enforcement” (IC2BE). Funded by the Justice Program (2014-2020) of the European Commission, the project aimed to assess the working in practice of the “second generation” of EU Regulations on procedural law for cross-border cases, i.e. the European Enforcement Order, Order for Payment, Small Claims and the Account Preservation Order Regulations (see our earlier post here). As a result, an open-access database of CJEU and national case law has been created which is available here. The presentations given at this conference have now been published in the second issue of the 2020 volume of the Zeitschrift für Vergleichende Rechtswissenschaft (German Journal of Comparative Law), Germany’s oldest continuously published review of comparative and PIL legal issues. The abstracts of the articles read as follows:

Informierte Entscheidungen in der grenzüberschreitenden Forderungsdurchsetzung – Vorstellung und Ergebnisse eines internationalen Forschungsprojekts [Informed Choices in Cross-Border Enforcement – Presentation and Results of an International Research Project]

Jan von Hein, University of Freiburg (Germany) – ZVglRWiss 119 (2020) 123–142

An efficient cross-border enforcement is more important than ever in light of the increasing economic integration of the EU. In order to achieve this aim, creditors may freely choose between enforcing a claim under Brussels Ibis or by means of the 2nd generation Regulations. Thus, weighing the pros and cons of choosing between one of the various options has become more difficult. This article presents the main findings of the EU-funded study „Informed Choices in Cross-Border Enforcement – IC2BE“, which is based on an extensive evaluation of case law and interviews with practitioners from eight Member States.

 

Der Anwendungsbereich der EU-Verordnungen zur grenzüberschreitenden Forderungsdurchsetzung [The scope of the EU Regulations on Cross-Border Enforcement of Claims]

Michael Stürner, University of Konstanz (Germany) – ZVglRWiss 119 (2020) 143–166

As part of the judicial cooperation in civil matters, the EU has issued a number of regulations on cross-border enforcement of debts. So far, this harmonization brings about piecemeal solutions with a certain lack of coherence. While those Regulations all apply in civil and commercial matters, they differ in their scope of application depending on the individual goal pursued by the act. The paper analyses those differences with a view to the material and geographical scope of application and discusses possible steps towards a reform, such as the abolition of the Enforcement Order Regulation or the consolidation of the various legal acts in a horizontal instrument (“Regulation Brussels 0”).

 

Die Sicherung von Forderungen im europäischen Zivilprozessrecht [Interim measures to secure monetary claims in European Civil Procedure]

Christian Heinze, University of Hanover (Germany) – ZVglRWiss 119 (2020) 167–196

Interim measures to secure monetary claims are addressed in several instruments of European civil procedure law, ranging from jurisdiction and recognition of foreign judgments, over special rules for cross-border proceedings and into sectoral procedural law for intellectual property disputes. The following article provides an overview of the relevant provisions and develops proposals on how a more coherent regulation at European level could be achieved.

 

Der Beitrag der Gerichtsorganisation zur Effizienz der grenzüberschreitenden Forderungsdurchsetzung [The Contribution of National Judicial Organization to the Efficiency of the International Recovery of Money Claims]

Christoph Althammer, University of Regensburg (Germany) – ZVglRWiss 119 (2020) 197–219

Measures taken by the national judicial organization have so far played only a minor role in improving cross-border enforcement of claims and diverge considerably in the European Member States. This is where the competence of the European legislature conferred by Art. 81 TFEU ends, so that harmonization efforts that are autonomous for the Union are difficult to implement. So far, the topic has been of practical importance in connection with the concentration of jurisdiction in central courts and the transfer of judicial matters to other judicial officers. However, the ECJ has recently made it clear in a different technical context that it wants to shape the national judicial organization more “European” in the future.

 

Der Beitrag der modernen Informationstechnologie zur Effizienz der grenzüberschreitenden Forderungsdurchsetzung [The Contribution of Information Technology to the Efficiency of the International Recovery of Money Claims]

Florian Eichel, University of Berne (Switzerland) – ZVglRWiss 119 (2020) 220–236

The article outlines how digitization and digitalization may contribute to make cross-border judicial recovery of money claims more efficient. It also considers the proposals for reform of the European Service and the European Evidence Regulations.

 

Anerkennungs- und Vollstreckungsversagungsgründe im Europäischen Zivilprozessrecht [Grounds for Refusing Recognition and Enforcement of Foreign Judgments in European Civil Procedural Law]

Haimo Schack, University of Kiel (Germany) – ZVglRWiss 119 (2020) 237–253

Even after the abolition of exequatur proceedings in art. 39 Brussels Ibis Regulation the grounds for non-recognition in art. 45 have been kept intact, albeit only after a separate motion by the debtor. Many other EU regulations, however, have significantly restrained the control by the enforcement State. The concurring and different provisions ask too much of the practitioners and invite abuse. The constitutionally mandated protection of the debtor in the enforcement State must not be sacrificed on the altar of an absolutely free movement of judicial decisions. The Regulation (EC) No. 805/2004 creating a European Enforcement Order for uncontested claims is outdated and should be scrapped.

 

Schnittstellen und Wechselwirkungen zwischen dem europäischen Zivilprozessrecht und dem nationalen Vollstreckungsrecht [Interfaces and Interactions between European and National Enforcement Law]

Caroline Meller-Hannich, University of Halle (Germany) – ZVglRWiss 119 (2020) 254–275

There are various ways of transferring a title into the enforcement system of foreign European Union member states, depending on the applicable EU-Regulation. This leads to an unclear legal situation that is to be solved by either the consolidation of the regulations of the second generation or by drafting one unitary system allowing for the freedom of enforcement title movement within the scope of all regulations. The German national executive and implementing law also needs to be revisited. The abolition of the exequatur in the Brussels Ia Regulation has resulted in unanswered questions concerning the enforcement procedure that must be clarified by jurisdiction. This applies in particular to the interpretation and adaptation of the title, the possible enforcement measures and the differentiation between the requirements of enforceability and the conditions for the enforcement procedure. This article will highlight these unanswered questions and suggest potential solutions.

The American Association of Private International Law (ASADIP) has postponed its annual conference to a later date in 2021, given the current pandemic. The 2021 conference is entitled “Private International Law and Modern Technologies” and will be held on 4-5 November 2021 in Washington DC (USA). The venues of the conference will be Georgetown University and the Organization of American States (OAS). Blockchain technology and its interrelation with PIL features prominently in the general topics to be discussed. For more information, click here.

As regards recent activities, ASADIP has proudly announced the translation into Spanish of the article of Hans van Loon, former Secretary General of the HCCH, entitled “The Global Horizon of Private International Law: Inaugural Lecture” delivered during the Hague Academy’s Private International Law Session of 2015  (published in Recueil des cours Vol. 380, Pages 9-108, apparently only available in book form). The Spanish translation of Hans van Loon’s article is “El horizonte global del Derecho internacional privado” and is fully available here.

 

The Pax Moot went totally online this year (OK, no surprises there). The case concerns an employment dispute and environmental damage due to mining in an unidentified African country (see the paxmoot website). It raises various issues of jurisdiction, applicable law, freezing orders, parallel proceedings and company structures.

Over the past two days the preliminary rounds took place on an online platform hosted by the University of Antwerp. The Universities of Cologne, Erasmus Rotterdam, Maastricht and Singapore Management University secured places in the semi-finals.

Please join us on 29 May at the links below for the semi-finals and finals. All welcome!

Semi-finals 1, 10.00 – 11.30 CEST: https://eu.bbcollab.com/guest/4a86f539e78642859e773e301ddbb8dd

University of Cologne v. Erasmus University Rotterdam

Judges: Ilse COUWENBERG, Daniel GIRSBERGER and Matthias WELLER

Semi-finals 2, 10.00 – 11.30 CEST: https://eu.bbcollab.com/guest/2d4c41243bf44fdbb3c175b15d0f30cf

Singapore Management University v. Maastricht University

Judges: Hans VAN HOUTTE, María ALVÁREZ TORNÉ and Michael WILDERSPIN

Finals, 13:30-15:00: https://eu.bbcollab.com/guest/b85996765dce4a4db29ad03e4a9b235f

13:30 Welcome words, by Frederik SWENNEN, Dean of the Law Faculty, University of Antwerp

Pleadings

Judges: Horatia MUIR WATT, Alex LAYTON, Hans VAN LOON

Approx. 15:30 Awards and Closing Ceremony

• A few words about the Case, by Alexander LAYTON QC
• A few words on behalf of the European Commission, DG Justice, Civil Unit, by Pia LINDHOLM
• Official results of the 2020 Rounds:
  • Best written submissions, by Horatia MUIR WATT, Competition Initiator and Member of the PAX Team
  • Best oralist, by Daniel CHAN, Executive Secretary of the PAX Team
  • Winner of the 2020 Asser Round, PAX Competition, by Horatia MUIR WATT
• Farewell words, by Hans van LOON

The Moot Court Competition is organised by the University of Antwerp and the T.M.C. Asser Instituut, as part of the research project on ‘Regulation BIa: a standard for free circulation of judgments and mutual trust in the EU (JUDGTRUST)’, funded by the European Union, DG Justice (JUST-JCOO-AG-2017), in cooperation with Sciences Po Law School.

 

The Max Planck Institute for Comparative and International Private Law in Hamburg is starting a new virtual workshop series in private international law. The first speaker, Mathias Lehmann from Bonn University, will present (in German) on Tuesday, June 2, at 11:00-12:30 via zoom. His topic: Covid-19 and Private International Law (see also here and here). Open to everyone, including doctoral and predoctoral students!

More information (in German) and the link for signing up are here.

This book provides an unprecedented analysis on the place of performance. The central theme is that the place of performance is of considerable significance as a connecting factor in international commercial contracts. This book challenges and questions the approach of the European legislator for not explicitly giving special significance to the place of performance in determining the applicable law in the absence of choice for commercial contracts. It also contains, inter alia, an analogy to matters of foreign country mandatory rules, and the coherence between jurisdiction and choice of law. It concludes by proposing a revised Article 4 of Rome I Regulation, which could be used as an international solution by legislators, judges, arbitrators and other stakeholders who wish to reform their choice of law rules.

The table of contents and further information on the book can be found on the publisher’s website: https://www.bloomsburyprofessional.com/uk/place-of-performance-9781509936205/.

Written by John Coyle, the Reef C. Ivey II Distinguished Professor of Law, Associate Professor of Law at the University of North Carolina School of Law, and Katherine C. Richardson, Law Clerk, U.S. Court of Appeals for the Sixth Circuit, 2020-21 Term

 

European legal scholars have long bemoaned the difficulty in identifying “black letter rules” when it comes to U.S. private international law.  One area where this law is famously opaque relates to state enforcement of “outbound” forum selection clauses.  Outbound clauses—which are known as derogation clauses in the rest of the world—state that a dispute must be heard by a court other than the one where the suit was brought.  State courts in the United States generally refused to enforce these provisions prior to 1972.  After the U.S. Supreme Court rendered its seminal decision in The Bremen, however, attitudes began to change.  Today, it is generally acknowledged that state courts are far more likely to enforce outbound forum selection clauses than they were fifty years ago.  To date, however, nobody has attempted to determine empirically the extent to which state court practice has shifted since the early 1970s.  Our new paper seeks to accomplish this goal.

 

State Practice by the Numbers

 

We reviewed every published and unpublished state court decision addressing the enforceability of outbound forum selection clauses decided after 1972.  Our analysis of these decisions revealed the following:

 

1. State courts in the United States enforce outbound forum selection clauses approximately 77% of the time when one party challenges the enforceability of the clause.

 

2. The enforcement rate is remarkably consistent across large states in the United States. In California, the enforcement rate was 80%. In Texas, it was 79%. In New York, it was 79%. In Florida, it was 78%.  In Ohio, it was 78%. In Illinois, it was 74%.

 

We are currently gathering data about federal court practice.  Our preliminary results suggest that the enforcement rate is at least as high, if not higher, when the enforceability of an outbound clause is challenged in federal court.

 

In addition to looking at enforcement rates, we also examined the rationales proffered by state courts in cases when they declined to enforce outbound clauses.  Knowing how often state courts enforce these clauses, and more importantly, why they do not enforce them, offers valuable insights for contract drafters, judges, and scholars. We found that when a state court refuses to enforce an outbound clause, it is almost always because the clause is contrary to public policy (8% of all cases) or unreasonable (12% of all cases).  What does it mean, however, for a clause to be contrary to public policy?  And what are the situations when a clause will be deemed unreasonable?  The cases in our data set shed light on both of these questions.

 

Public Policy

 

With respect to public policy, state courts most frequently refuse to enforce an outbound clause because there is a state statute directing them to ignore it.  Forty-nine states have enacted states declaring outbound clauses unenforceable in consumer leases.  Twenty-eight states have enacted statutes announcing a similar rule with respect to clauses in construction contracts.  All told, we identified more than 175 state statutes directing courts to refuse to enforce outbound clauses across a wide range of agreement types.  Our paper includes a detailed chart that shows which statutes are in force in which states.

 

U.S. courts also sometimes refuse to enforce a clause on public policy grounds by citing an “anti-waiver” statute. Anti-waiver statutes provide that certain rights conferred by state law are non-waivable.  When a state court is presented with a contract that contains an outbound forum selection clause, and when the forum court concludes that the courts in the chosen jurisdiction are unlikely to give effect to non-waivable rights conferred by the forum state, the forum court may refuse to enforce the forum selection clause on public policy grounds.  On this account, the enforcement of the clause is contrary to the public policy of the forum not because the legislature has specifically directed the courts to ignore it.  Instead, these clauses go unenforced because their enforcement would result in the waiver of non-waivable rights.

 

Reasonableness

 

The most common basis cited by state courts in refusing to enforce an outbound forum selection clause is a lack of reasonableness. The most common reason why state courts strike down clauses on reasonableness grounds is that the clause would result in duplicative litigation. Courts are reluctant to enforce the clause—and send litigation elsewhere—if it means the plaintiff would have to litigate the same set of facts in two different fora.

 

Second, many state courts refuse to uphold forum selection clauses if it means the plaintiff cannot secure effective relief in the chosen forum. Typical examples of this type of concern include procedural or jurisdictional problems in the chosen forum, claims that are so small as to make it uneconomical for a plaintiff to pay the costs to travel to pursue them, and fora that constitute a “serious inconvenience” to the plaintiff. We should note here that most state courts do not refuse to enforce clauses because it would be expensive for the plaintiff to maintain the lawsuit in another state. However, when the plaintiff presents an extremely small claim or an extreme expense to litigate, some courts will take pity the plaintiff and refuse to enforce the outbound clause.

 

In several other categories of cases, state courts refuse to uphold outbound clauses when (1) the plaintiff has no notice of the clause, or (2) the chosen forum bears no reasonable relationship to the parties. The notice issue arises most frequently in cases of form passage tickets, mostly for cruise lines, and in online “clickwrap” agreements. Some courts have been reluctant to hold plaintiffs responsible for forum selection clauses in these two scenarios when the defendant did not reasonably communicate the clause to the plaintiff. In addition, some courts refuse to uphold outbound clauses against unsophisticated parties where the clause is buried in fine print amid other legal jargon. We note, however, that simply because a forum selection clause is contained in a contract of adhesion does not make it unreasonable. This scenario was obviated by the Supreme Court’s ruling in Carnival Cruise Lines, Inc. v. Shute, where the Court upheld a forum selection clause on the back of a preprinted cruise ticket. Finally, the typical contract defenses, such as fraud, unconscionability, and problems with formation, all apply to forum selection clauses as well, with some variation among the states.

 

On 2 July 2019, the Hague Conference on Private International Law (HCCH) adopted the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (2019 HCCH Judgments Convention). The instrument has already been described as a true game changer and the apex stone in international commercial litigation.

To celebrate the adoption of the 2019 HCCH Judgments Convention, the Netherlands International Law Review (NILR) produced a special edition entirely dedicated to the instrument.

Volume 67(1) of the NILR, which is now available in its final, paginated version, features contributions from authors closely involved in the development of the instruments. The articles provide deep insights into the making, and intended operation, of the instrument. They are a valuable resource for law makers, practitioners, members of the judiciary and academics alike.

The NILR’s Volume comprises the following contributions (in order of print, open access contributions are indicated; the summaries are, with some minor modifications, those published by the NILR).

Thomas John ACIArb, “Foreword” (open access)

Ronald A. Brand, “Jurisdiction and Judgments Recognition at the Hague Conference: Choices Made, Treaties Completed, and the Path Ahead”

Ron Brand considers the context in which a Hague Convention on Jurisdiction and the Recognition and Enforcement of Foreign Judgments was first proposed in 1992. It then traces the history of the Hague negotiations, both from within those negotiations and in regard to important developments outside the negotiations, through the completion of the 2005 Convention on Choice of Court Agreements and the 2019 HCCH Judgments Convention. The article ends with comments on whether it is advisable to now resume discussion of a separate convention on direct jurisdiction.

Francisco Garcimartín, “The Judgments Convention: Some Open Questions”

Francisco Garcimartín explores some of the open issues that were discussed in the negotiation process but remained open in the final text, such as, in particular, the application of the 2019 HCCH Judgments Convention to pecuniary penalties (2) and negative obligations (4), as well as the definition of the res judicata effect (3).

Cara North, “The Exclusion of Privacy Matters from the Judgments Convention”

Cara North considers on issue of particular focus in the later phases of the negotiations of the Convention, namely, what, if any, judgments ruling on privacy law matters should be permitted to circulate under the 2019 HCCH Judgments Convention. Having acknowledged that privacy is an evolving, broad and ill-defined area of the law and that there are obvious differences in the development and operation of privacy laws and policies in legal systems globally, the Members of the Diplomatic Session on the Judgments Convention determined to exclude privacy matters from the scope of the Convention under Article 2(1)(l). The purpose of this short article is to describe how and why the Diplomatic Session decided to exclude privacy matters from the 2019 HCCH Judgments Convention and to offer some observations on the intended scope of that exclusion.

Geneviève Saumier, “Submission as a Jurisdictional Basis and the HCCH 2019 Judgments Convention”

The 2019 HCCH Judgments Convention establishes a list of jurisdictional filters, at least one of which must be satisfied for the judgment to circulate. One of those is the implied consent or submission of the defendant to the jurisdiction of the court of origin. While submission is a common jurisdictional basis in international litigation, its definition and treatment vary significantly across states, whether to establish the jurisdiction of the court of origin or as a jurisdictional filter at the enforcement stage in the requested court. This diversity is most evident with respect to the mechanics and consequences of objecting to jurisdiction to avoid submission. The 2019 HCCH Judgments Convention adopts a variation on an existing approach, arguably the least complex one, in pursuit of its goal to provide predictability for parties involved in cross-border litigation. This contribution canvasses the various approaches to submission in national law with a view to highlighting the points of convergence and divergence and revealing significant complexities associated with some approaches. It then examines how the text in the 2019 HCCH Judgments Convention came to be adopted and whether it is likely to achieve its purpose.

Nadia de Araujo, Marcelo De Nardi, “Consumer Protection Under the HCCH 2019 Judgments Convention”

The 2019 HCCH Judgments Convention aims at mitigating uncertainties and risks associated with international trade and other civil relationships by setting forth a simple and safe system according to which foreign judgments can easily circulate from country to country. The purpose of this article is to record the historical moment of the negotiations that took place under the auspices of the HCCH, as well as to pinpoint how consumer cases will be dealt with by the Convention under Article 5(2).

Niklaus Meier, “Notification as a Ground for Refusal”

The 2019 HCCH Judgments Convention provides for several grounds for the refusal of recognition, including refusal based on insufficient notification. While this ground for refusal of the 2019 HCCH Judgments Convention seems quite similar to those applied in other conventions, the comparison shows that there are several differences between this instrument and other texts of reference, both with respect to the context of application as well as with respect to the details of the wording. The optional nature of the grounds for refusal under the 2019 HCCH Judgments Convention indicates that its primary focus is the free circulation of judgments, and not the protection of the defendant. The latter’s protection is left to the discretion of the state of recognition: a sign of trust amongst the negotiators of the 2019 HCCH Judgments Convention, but also a risk for the defendant. Practice will show whether the focus of the negotiators was justified.

Junhyok Jang, “The Public Policy Exception Under the New 2019 HCCH Judgments Convention”

The public policy exception is inherently a fluid device. Its content is basically left to each State. A shared public policy is an exception. Therefore, the obligation of uniform interpretation, as provided in Article 20 of the 2019 HCCH Judgments Convention, will have an inherent limit here. Moreover, the 2019 HCCH Judgments Convention leaves some important issues, including procedure, to national rules. Each requested State retains a discretion to invoke the Convention grounds of refusal in a concrete case, and on whether to make an ex officio inquiry or have the parties prove those refusal grounds. The 2019 HCCH Judgments Convention also provides for the concrete applications of the public policy exception, following the model of the 2005 Choice of Court Convention. Here, a purely grammatical reading may create some peripheral problems, especially with the specific defences of conflicting judgments and parallel proceedings. Solutions may be found in the method of purposive interpretation and some general principles, particularly the evasion of the law and the abuse of rights, before resorting to the public policy defence.

Marcos Dotta Salgueiro, “Article 14 of the Judgments Convention: The Essential Reaffirmation of the Non-discrimination Principle in a Globalized Twenty-First Century”

The 2019 HCCH Judgments Convention includes a non-discrimination disposition in Article 14, according to which there shall be no security, bond or deposit required from a party on the sole ground that such a party is a foreign national or is not domiciled or resident in the State in which enforcement is sought. It also deals with the enforceability of orders for payment of costs in situations where the precedent disposition applied, and lays down an ‘opt-out’ mechanism for those Contracting States that may not wish to apply that principle. This article frames the discussion of the non-discrimination principle in the wider context of previous private international law instruments as well as from the perspectives of access to justice, human rights and Sustainable Development Goals (SDGs), understanding that its inclusion in the 2019 HCCH Judgments Convention was an important, inescapable and necessary achievement.

Paul R. Beaumont, “Judgments Convention: Application to Governments” (open access)

The 2019 HCCH Judgments Convention makes the classic distinction between private law matters within its scope (civil or commercial matters) and public law matters outside its scope. It also follows the same position in relation to State immunity used in the Hague Choice of Court Convention 2005 (see Art. 2(5) in 2019 and 2(6) in 2005). The innovative parts of the 2019 HCCH Judgments Convention relate to the exclusions from scope in Article 2 relating to the armed forces, law enforcement activities and unilateral debt restructuring. Finally, in Article 19, the Convention creates a new declaration system permitting States to widen the exclusion from scope to some private law judgments concerning a State, or a State agency or a natural person acting for the State or a Government agency. This article gives guidance on the correct Treaty interpretation of all these matters taking full account of the work of the Hague Informal Working Group dealing with the application of the Convention to Governments and the other relevant supplementary means of interpretation referred to in Article 32 of the Vienna Convention on the Law of Treaties.

João Ribeiro-Bidaoui, “The International Obligation of the Uniform and Autonomous Interpretation of Private Law Conventions: Consequences for Domestic Courts and International Organisations”

This article addresses the issue of the uniform and autonomous interpretation of private law conventions, including of private international law conventions, from the perspective of their Contracting States, particularly their judiciaries, and of the international organizations. Firstly, the author analyses the use of standard uniform interpretation clauses, and the origin of such clauses, in the context of the Hague Conference on Private International Law. The following part the article addresses negative and positive obligations imposed on States and their judiciaries under international law regarding the uniform and autonomous interpretation of international treaties. It is argued that States are not only obliged to refrain from referring to concepts from national laws for the purpose of the interpretation of international law instruments, but also that they face certain positive obligations in the process of applying the conventions. Those include referring to foreign case law, international scholarship, and under certain circumstances, also to travaux préparatoires. Thirdly, the author discusses the role of international organizations—e.g. HCCH, UNCITRAL, UNIDROIT, in safeguarding and facilitating the uniform and autonomous interpretation of private law conventions. It does so by describing various related tools and approaches, with examples and comments on their practical use (e.g. advisory opinions, information sharing, access to supplementary material, judicial exchanges and legislative action).

The NILR’s Special Edition on the 2019 HCCH Judgments Convention concludes with a reproduction of the text of the 2019 HCCH Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters, as adopted on 2 July 2019.

A French Décret, allows, for the time of the state of emergency, notarization by a French notary without a need for parties to be physically present. Explanation and analysis is here and (briefly) here. Importantly, the possibility is also open to non-residents of France.  Notaries in France had, unsurprisingly, warned of the risk of fraud, but the Conseil d’Etat approved of the decret.

Austria has a similar rule in sec. 90a of its Notary Act. In Germany, this is not (yet?)possible: Art. 40(1) of the German Notarisation Act requires physical presence of the parties; the greatest distance allowed is, apparently, the way to the parking lot. Estonia has introduced an e-notary for notarisation from abroad, but this is available only in Estonian embassies.

The French and Austrian rules raise interesting private international law questions. Usually, notarization requires physical presence – which is why so many lawyers fly from Germany to France to have contracts notarized. Can they now stay at home? If two French domiciliaries sign a contract electronically while in Switzerland, and notarization happens in France, is this a case of Art. 11(1) Rome I Regulation? That would lead to the odd result that the formal requirements would follow from either Swiss law or from the law applicable to the contract (which need not be French law) and not necessarily the law of the place where the French notary sits. And yet, Art. 11(2) seems inapplicable because the notary is not an agent of the parties. Should it be applicable by analogy? Should there be a special rule for notaries that used to be unnecessary because notarization always requires physical notaries? Or is this another reason to rethink the principle of locus regit actum for internet contracts?

Preliminary question and its context

In its Judgment of 7 May 2020, delivered in the joined cases C-267/19 and C-323/19 without Advocate General’s Opinion, the Court of Justice provides some further guidance on the implications of its previous case law and most notably of the Judgment in the case C-551/15, Pula Parking (‘Judgment in Pula Parking’).

Just as in the case that led to Judgment in Pula Parking, the requests for a preliminary ruling in the cases in question were lodged in the context of the proceedings on the oppositions to the writs of execution. Put succinctly: under the Croatian law, a notary issues a writ of execution based on an ‘authentic document’. The party against whom enforcement is sought may lodge an opposition to that writ. The court to which the opposition is transferred has jurisdiction to set aside the writ and to annul the measures taken so far. The procedure continues according to the rules applicable to cases of opposition to a payment order.

By way of background, in Judgment in Pula Parking, the Court held, inter alia, that ‘[the Brussels I bis Regulation] must be interpreted as meaning that, in Croatia, notaries, acting within the framework of the powers conferred on them by national law in enforcement proceedings based on an “authentic document”, do not fall within the concept of “court” within the meaning of that [Regulation]’.

The referring court in the present cases indicates that Judgment in Pula Parking receives various interpretation on the national level. It seems that the reading of this Judgment according to which it relates exclusively to enforcement proceedings conducted against a party being a natural person and national of another EU Member State prevails in the Croatian case law.

However, for the referring court, that reading of Judgment in Pula Parking establishes a discriminatory difference in the way in which the Brussels I bis Regulation is applied in Croatia. The referring court seems to understand that Judgment as implying that, in its Member State, notaries are not entitled to issue writs of execution based on an ‘authentic document’ and therefore, the fact that they continue to do so, is at odds with the Regulation.

In view of those explanations, at paragraph 42 the Court clarifies that it understands the request for a preliminary ruling as concerning the question whether Article 18 of the Treaty on the Functioning of the European Union and Article 47 of the Charter preclude national legislation entitling the Croatian notaries to issue the writs of execution on the basis of the ‘authentic documents’, which, in light of Judgment in Pula Parking, will not be recognized and/or enforced in other Member States under the scheme of the Brussels I bis Regulation.

 

Consideration of the question referred and what can be learned from it

At paragraph 43 the Court reaffirms that the writs of execution issued by the Croatian notaries would not benefit from the scheme of the Regulation when it comes to their recognition and/or enforcement. At paragraph 44, the Court reminds that Judgment in Pula Parking does not imply, however, that the Brussels I bis Regulation prevents the notaries from issuing the writs of execution. The references to Judgment in Pula Parking pave the way for the conclusion that neither Article 18 of the TFUE (paragraph 45), nor Article 47 of the Charter (paragraph 53) preclude national legislation entitling the notaries to issue the writs of execution which do not benefit from the recognition/enforcement scheme of the Regulation.

Incidentally, given that according to Judgment in Pula Parking the notaries do not fall within the concept of ‘court’ within the meaning of the Brussels I bis Regulation, paragraph 43 seems to imply that a writ of execution based on a ‘authentic document’ would not be recognized and/or enforced as ‘judgment’ within the meaning of Article 2(a) of the Regulation.

Neither the joined cases in question, nor the case that led to Judgment in Pula Parking offered an opportunity to address the question whether a writ of execution issued by a notary could be enforced under the scheme of the Brussels I bis Regulation as an ‘authentic instrument’ in the sense of Article 2(c) of the Regulation. In any case, an ‘authentic document’ on which a writ of execution is based cannot, in my view, be automatically placed on the same footing as such ‘authentic instrument’. Therefore, a writ of execution would not necessarily have to be an ‘authentic instrument’ based on an ‘authentic instrument’.

For the sake of completeness, AG Bot touched upon a somehow similar question in the context of the Regulation No 805/2004 (Regulation on European Enforcement Order for uncontested claims) in his Opinion in the case C-484/15, Zulfikarpaši. At points 45 to 49, he considered that a writ of execution is not an ‘authentic instrument’ within the meaning of Article 3(1) of that Regulation because the writ does not concern an uncontested claim. That argumentation is in line with the interpretation that the Court presented in its Judgment in that case and in particular at its paragraph 55. However, such argumentation could most probably not be directly transposed to the Brussels I bis Regulation as this Regulation does not confine its scope solely to uncontested claims.

It is also worth noticing that the Judgment of 7 May 2020 makes a point that exceeds the scope of the inquiry on the implications of Judgment in Pula Parking for the Croatian legal system. At paragraphs 33 et seq., in the part of the Judgment of 7 May 2020 relating to the jurisdiction of the Court, the criteria set in Article 3(1) of the Regulation no 1896/2006 (Regulation on European Order for Payment) in order to define a ‘cross-border case’ within the meaning of that Regulation are referred to in order to establish the existence of an international element that is necessary for the Brussels I bis Regulation to become applicable to a specific case.

The requests for a preliminary ruling in the cases in question can be consulted here and here. For numerous linguistic versions of the Judgment see here (no English version yet).

by Jie (Jeanne) Huang, Sydney Law School

 

On 19 May 2020, the Supreme Court of New South Wales rendered the judgment in Bao v Qu; Tian (No 2) and decided to enforce a monetary judgment issued by the Qingdao Intermediate People’s Court of Shanghai Province, China. This is the first case at the state of NSW in Australia where a Chinese monetary judgment got enforced.

The Chinese judgment-rendering proceedings

Both plaintiff and the defendants are citizens of China. The two defendants were a couple. The defendants allegedly did not pay loans borrowed from the plaintiff. In 2014, the People’s Court of Laoshan District Qingdao handed down the first-instance judgment for the plaintiff. One defendant appealed. Both defendants were represented in the second-instance trial at the Qingdao Intermediate People’s Court of Shangdong Province (‘Qingdao Court’). The Qingdao Court rendered the final judgment (‘Chinese judgment’) ordering the defendants to pay RMB 2,050,000 plus interest to the plaintiff in 2015. The Chinese judgment was partly enforced in China but largely remained outstanding.

The NSW judgment-enforcement proceedings

The plaintiff applied to enforce the Chinese judgment at the Supreme Court of NSW in 2019 under the common law. The defendants are resident in NSW and were personally served with the court proceedings.

The defendants conceded that the Qingdao Court had jurisdiction, the Chinese judgment was final and conclusive, and they were judgment debtors. However, they alleged that a substantial amount of money had been returned to the plaintiff before the Chinese judgment was rendered. The plaintiff rejected this argument alleging that the defense went to the merits of the Chinese judgment that should not be reviewed by the NSW court at the judgment recognition and enforcement (‘JRE’) proceedings.

The NSW court holds that defendants submitted to the jurisdiction of Chinese court by their procedural conducts. There is no evidence of any step taken to challenge the Chinese judgment in China. The first issue at the NSW proceeding is whether the Chinese judgment is obtained by fraud. Namely, whether the Chinese court was intentionally or recklessly misled into determining the incorrect value of the debt by not being made aware of the alleged repayments. The NSW court held that one of the alleged repayments seemed to have been raised in the Chinese proceedings but ultimately rejected by the Chinese Court. No evidence showed that Chinese Court denied the defendants the opportunity to presenting their case before an impartial tribunal or that the defendants were otherwise not given due notice. There was also no evidence showing that the alleged repayments were not reasonably discoverable at the time of the Chinese proceedings. Further, nothing proved that the alleged repayments had ever occurred or were related to the loans decided in the Chinese judgment. In conclusion, NSW court rejected the alleged repayments and refused to review the merits of Chinese judgment.

The second issue focuses on the legal nature of the punitive interest awarded in the Chinese judgment. The Chinese judgment included two types of interests. The first is the general interest calculated at the ‘benchmark interest rate for the loans in the same type as issued by the People’s Bank of China for the same period’. The second is the punitive interest awarded according to Article 253 of Chinese Civil Procedural Law, being that ‘if the judgment debt was not satisfied by 20 September 2015, then “the interest on the debt during the period of delay in fulfillment shall be paid at the double amount”.’ The court held that no submissions were made that the imposition of Article 253 interest was penal in nature, so it should be awarded.

Comments

1. Reciprocity

China is not listed in the Foreign Judgments Act 1991 (cth), so Chinese judgments cannot benefit from the ex parte registration process. Nevertheless, Chinese judgments can be recognized and enforced under the common law in Australia. However, China requires de facto reciprocity. This is demonstrated by a reply issued by the Chinese Supreme People’s Court in 2006, which provides that judgments issued in Australia cannot be recognized and enforced in China because Australia has not offered reciprocity to Chinese judgments.[1] Liu v Ma & anor [2017] VSC 810 is the first Chinese monetary judgment recognized and enforced in the state of Victoria. By Bao, the NSW court also enforced a Chinese monetary judgment. Considering the recent JRE development in Australia, Chinese Supreme People’s Court should review the 2006 reply. De facto reciprocity should have been established between China and Australia (or at least the states of Victoria and NSW). Judgments issued in Australia should be recognized and enforced in China if they do not violate the basic principles of Chinese law and the sovereignty, security and public interest of China according to Article 282 of Chinese Civil Procedure Law.

2. The alleged repayment

According to the NSW court, the Chinese judgment indicates that the Chinese court ‘refuse[d] to consider this request [to reduce the judgment debt as a result of the alleged repayment of RMB 200,000]’ because this claim ‘exceeded the scope of the Appellant’s claim’. The Chinese court’s rejection does not violate natural justice. This is because according to Chinese Civil Procedure Law, an appeal should be brought within 15 days after the first-instance judgment is served. If a party fails to bring a claim within this time period, the party loses its right to appeal. In practice, some appellants may bring an appeal within the time limit without clearly listing the claims and later try to add new claims. This practice goes against the seriousness of appeal. It is also inconsistent with the fairness and efficiency of litigation because the respondent should be served with the new claim and given a reasonable time to prepare the defence. Therefore, as a general principle, Chinese courts do not consider a new claim if it is not raised in the appeal petition.[2]

3. Double interest

Australian courts do not enforce foreign punitive damages that aim to ‘penalise the [ ] defendant and to deter others from failing to comply with the Court’s orders’ (Schnabel v Lui [2002] NSWSC 15 at [176]). However, the courts can enforce punitive damages that were to compensate the plaintiff’s private right due to the defendant’s deliberate and callous conduct and involved no public connotation in the remedy (Benefit Strategies Group v Prider [2004] SASC 365 at [72]).

Article 253 of the Chinese Civil Procedure Law provides that ‘if the party against whom enforcement is sought fails to pay money within the period specified in the judgment, he or she shall pay double interest for the debt for the period of delayed performance.’

The double interest imposed by this provision intends to punish the defendant for the delay of executing the judgment and remedy the plaintiff’s private right. It is not for the public interest of Chinese state. Therefore, the court correctly decided that the double interest should be enforced at the NSW.

 

[1] Letter of Reply of the Supreme People’s Court on Request for Instructions Re Application of DNT France Power Engine Co., Ltd. for Recognition and Enforcement of Australian Court Judgment [2006] Min Si Ta Zi No 45.

[2] There are few exceptions to this general principle. For example, the respondent agrees to add the new claim to the trial, or the new claim involves a fact which must be investigated by the court rather than the parties and without the finding of this fact, the case cannot be correctly decided.

As mentioned in my previous post, the Zeitschrift für Recht und Islam / Journal of Law & Islam issued a Call for Papers and kindly provided the following information:

The Zeitschrift für Recht und Islam / Journal of Law & Islam (ZR&I, previously: GAIR-Mitteilungen) is a scientific journal in co-operation with the Gesellschaft für Arabisches und Islamisches Recht e. V. (GAIR), a non-profit scientific association established in 1997. Its aim is the furthering of mutual understanding of law, legal systems and legal practice between European scholars and those of the Arabic and wider Islamic region.

The annual scientific journal contributes to this aim by publishing contributions on the legal developments in this field, covering theoretical legal debate as well as the practical application of both secular and Islamic laws. The journal gives space to a wide range of perspectives and takes regard of the historical development as well as the interaction of “secular” and Islamic laws in different contexts. Its analyses and debates go beyond the basic principles and outlines of those legal systems, but also address the actual developments, both in aspiration and reality. In addition, it covers key phenomena affecting – or even determining – scientific discourse, legislation and legal practice in the relevant states. This focus does however not confine itself to topics of specific or general regional interest, but also addresses the influence of global develop-ments and tendencies, as well as the legal relations among states.

Accordingly, we invite well-known and junior scholars as well as practitioners to help furthering this mutual understanding and dialogue by submitting publishable manuscripts. In view of imple-menting the aims of our association in a full and broad manner, the editors welcome contributions from specific disciplines, as well as interdisciplinary contributions that address the aspects above. We highly welcome the submission of articles, reports and reviews as well as case reports and comments on cases and legislation to the editorial double peer review process. Submissions must, however, not have been published or submitted for publication elsewhere.

The editors accept submissions in German and English. Please send your contributions to zri@gair.de, enclosing a brief personal description (no detailed curriculum vitae required). We kindly ask you to provide your submissions in the following format:

• submissions should have the formats doc, docx, odt or rtf,
• concerning fonts, we recommend Times New/Beyrut Roman, Arial, Junicode please use Unicode-characters for diacritic purposes
• use footnotes instead of a separate bibliography;

Bibliographical references should include:

1) concerning monographs and miscellanies:

a) Christian Starck (ed.): Constitutionalism, Universalism and Democracy – a Compar-ative Analysis, Studien & Materialien zur Verfassungsgerichtsbarkeit 75, 1999.

b) Matthias Herdegen: Constitutional Rights and the Diminishing State, in: Constitu-tionalism, Universalism and Democracy – a Comparative Analysis, Studien & Materialien zur Verfassungsgerichtsbarkeit 75, ed. by Christian Starck, 1999, pp. 183–198.

2) concerning articles:

a) William M. Ballantyne: The New Civil Code of the UAE: A Further Reassertion of the Shari?a, in: Arab Law Quarterly 3 (1985), pp. 245–264.

3) concerning internet sources: www.aladalacenter.com (last access 15.10.2017).

Quotes from the Arabic language that go beyond technical terms or short phrases should, in addition to the Arabic original, be provided in transcribed form (using an accepted scientific transcription system such as DMG or Encyclopaedia of Islam) and in translation.

Each submission will be subject to a double peer review procedure by two anonymous colleagues in the relevant area. Once their reports on a submission have been received, the authors will be notified whether their submission is accepted, accepted subject to changes, or rejected. The editors will be overseeing this process and make the final decision on publication. All authors will receive their contribution with editorial changes for a final review prior to publication.

For any queries please contact Sina Nikolajew from the editorial team, as well as the editors Beate Anam, Dr Hatem Elliesie, Kai Kreutzberger and Prof Dr Dr Peter Scholz at zri@gair.de.

Information about the journal (in English) is availabe here.

Volume 11/2019 of the Journal of Law & Islam / Zeitschrift für Recht & Islam (ZR&I) has just been published. The full issue is available online here. It includes case notes and articles devoted to questions of Islamic law and its interaction with other legal systems. Some of the articles are in English or French.

The Journal editors were so kind to provide me with English translations of the German articles:

Zeitschrift für Recht & Islam / Journal of Law & Islam ZR&I Volume 11 (2019)

EDITORIAL ………. (pp. 5 f.)

RECHTSPRECHUNG & URTEILSBERICHTE [CASE LAW & JUDGMENT DISCUSSION] ………. (pp. 5–12)

• Nichtanerkennung einer katarischen Privatscheidung: Anmerkung zu OLG Stuttgart, Beschluss vom 3.5.2019, Az. 3465 E – 519/18 [Non-recognition of a Qatari Private Divorce: Commentary on OLG Stuttgart, Decision of 3.5.2019, Az. 3465 E – 519/18] ………. (pp. 7–9), Peter Scholz
• Nichtanerkennung einer pakistanischen Adoptionsentscheidung: Anmerkung zu OLG Stuttgart, Beschluss vom 21. 1. 2019, Az. 17 UF – 25/18 [Non-recognition of a Pakistani Adoption Decision: Commentary on OLG Stuttgart, Decision of 21. 1. 2019, Az. 17 UF – 25/18]………. (pp. 11 f.), Peter Scholz

ARTIKEL [ARTICLES] ………. (pp. 13–173)

• Targih und madhab: Zur Rolle des targih-Verfahrens bei der Entwicklung der traditionellen islamischen Rechtsschulen [Targih and madhab: Regarding the Status of the targih Procedure in the Development of the Traditional Islamic Law Schools] ………. (pp. 13–37), Ahmed Gad Makhlouf
• Die Hisbollah und die schiitische Frau – ihre religiösen Rechte und entsprechende politische sowie öffentliche Darstellung [Hisbollah and the Shi’i Woman – Her Religious Rights and Corresponding Political aas well as Public Representation] ………. (pp. 39–56), Batol Kobeissi
• Die Fatwa-Praxis des schiitischen Großayatollahs Sayyid Muhammad Husain Fadlallah am Beispiel Masturbation [The Fatwa Practice of the Shi’i Great Ayatollah Sayyid Muhammad Husain Fadlallah Exemplified on Masturbation] ………. (pp. 57–78), Doris Decker
• Zur Geschichte zweier hadite, die häufig in der Diskussion über FGM zitiert werden [On the Historical Derivation of two hadite Commonly Cited in the Discussion about FGM] ………. (pp. 79–104), Thomas Eich
• Die Talaq-Scheidung und das deutsche Recht [Talaq Divorce and German Law] ………. (pp. 105–112), Christian F. Majer
• Zum Straftatbestand der Kindesmisshandlung: Ein Blick auf die Rechtspraxis in Saudi-Arabien [The Criminal Offense of Child Abuse: Reflections on the Legal Practice in Saudi Arabia] ………. (pp. 113–144), Elisa Schweitzer
• The Recognition and Enforcement of German Money Judgments in Turkey………. (pp. 145–151), Hamit Alp Ünlü
• La finance islamique au service de l’économie sociale et solidaire de l’occident [Islamic Finance and its Service for the Social and Solidarity Economy of the Occident] ………. (pp. 153–173), M’hamed Hamidouche & Amina Berkane & Ahmed Berkane

TAGUNGSBERICHTE [CONFERENCE REPORTS] ………. (pp. 175–189)

The Hanafi School: History, Transformations, and Future, 3–5 December 2018, Amsterdam ………. (pp. 175–186), Samy Ayoub

TIF 2019 – Tunisia Investment Forum, 20. und 21. Juni 2019 in Tunis [TIF 2019 – Tunisia Investment Forum, 20 and 21 June 2019 in Tunis] ………. (pp. 187–189), Achim-Rüdiger Börner

REZENSIONEN [REVIEWS] ………. (pp. 191–199)

Rezension zu Adnan Trakic / John Benson / Pervaiz K Ahmed: Dispute Resolution in Islamic Finance. Alternatives to Litigation?, London / New York: Routledge 2019 [Review of Adnan Trakic / John Benson / Pervaiz K Ahmed: Dispute Resolution in Islamic Finance. Alternatives to Litigation?, London / New York: Routledge 2019] ………. (pp. 191–193), Kilian Bälz

Rezension zu Naseef Naeem: Der Staat und seine Fundamente in den arabischen Republiken, Berlin: Deutscher Levante-Verlag 2019 [Review of Naseef Naeem: Der Staat und seine Fundamente in den arabischen Republiken, (The State and its Foundations in Arab Republics), Berlin: Deutscher Levante-Verlag 2019] ………. (pp. 195–199), Achim-Rüdiger Börner

CALL FOR PAPERS ………. (pp. 201–204)

IMPRESSUM [IMPRINTS] ………. (pp. 205 f.)

For further information about the Journal see also its English page zri.gair.de/index.php/en.

The Journal also issued a Call for Papers which I will post seperately.

Written by Silja Vöneky, University of Freiburg

Note: This blogpost is part of a series on „Corporate social responsibility and international law“ that presents the main findings of the contributions published in August Reinisch, Stephan Hobe, Eva-Maria Kieninger & Anne Peters (eds), Unternehmensverantwortung und Internationales Recht, C.F. Müller, 2020.

I. Introduction

1. The question of the status of transnational corporations in investment arbitration is of central importance for the division of spheres of responsibility, for the pursuit and enforcement of values, and thus for the bases of legitimation of the international legal order today.

2. The promotion of foreign direct investments and the deepening of economic cooperation between States to promote economic development with the common welfare objective of increasing the prosperity of the peoples of the contracting States parties has been the legitimating basis of the ICSID Convention, which is central to investment protection under international law, and of the bilateral investment protection agreements.

3. Investment protection law, as part of public international law – from its basis and purpose – should not be understood as a departure from a state-centered international order.

4. From the point of view of international law, the following questions have to be answered: What are the implications for the investment protection regime and investment arbitration as its core

a) if the triad justifying economic globalization (foreign private investment – promotion of economic development – promotion of prosperity) loses its persuasiveness as a paradigm for its justification in a normative sense, and

b) if a discourse of delegitimization prevails that accuses profit-oriented transnational corporations in their role as investors of irresponsible conduct, which is incompatible with the public welfare, and States of enabling this conduct to the detriment of their own population by means of international treaties establishing investment arbitration?

5. The aim to align investment treaties with the principle of sustainable development can be seen by the reforms initiated by States, groups of States, and the United Nations Conference on Trade and Development; besides, this aim should have an impact on already existing investment treaties and investment arbitration as far as it is coherent with international law.

II. Transnational corporations as equal parties under international law within the framework of investment arbitration

6. A necessary condition for the equality of the host State and an investing foreign corporation as parties is that both by consent agree to arbitration in respect of a legal dispute directly related to an investment, i.e. that the State, which is a contracting party to the ICSID Convention and a subject of international law, besides ratifying the convention additionally gives its written consent (Art. 25 (1), Art. 36 (2) ICSID Convention), which has a threefold function (legitimating element, transformative element and constitutive element).

7. For various reasons, the procedural equality of the host State and the transnational corporations within the framework of a concrete arbitration procedure is justified and thus legitimate with regard to the international legal order as a whole. In particular, it complies with the principle of fair trial and the rule of law as enshrined in international law.

8. The principle of the equality of the parties does not preclude that transnational corporations are given preferential access to arbitration on the basis of international treaties and that arbitration is open only to transnational corporations.

9. The principle of the equality of the parties is inter alia observed during the composition of an arbitral tribunal if the judges are appointed by both parties in the same manner and each judge fulfils criteria which plausibly ensure impartiality. However, the appointment by the parties is not a necessary condition for the equality of the parties.

10. Questions about how to implement the principle of the equality of the parties arise in the arbitral proceedings themselves, in particular with regard to the possibility that several investors seek to bring their claims against the same host State, with regard to the admissibility of a counterclaim by the host State, with regard to the admissibility of “amicus curiae briefs” (third person submissions), with regard to the so-called equality of arms, and with regard to the problem of safeguarding confidentiality interests (in particular State secrecy).

11. Questions of the applicable law within the scope of the merits, such as the possibility of the host State to invoke justifications under international law (e.g. necessity) and the principles of interpretation of the investment protection agreements, are not considered to be questions of the principle of the equality of the parties.

III. (Un)justified unequal treatment to the detriment of transnational corporations as parties with regard to corruption problems

12. The decisions of arbitral tribunals, which deny their jurisdiction or the admissibility of the investor claim if the defendant host State asserts corruption, are convincing (only) with regard to limited types of cases.

13. The lack of jurisdiction of the tribunal or the inadmissibility of the investor’s claim does not seem to be justified even if the transnational corporation’s act of corruption made the investment possible in the first place: The contrary reasoning in investment arbitration decisions, based inter alia on the wording of bilateral investment treaties, the scope of the host State’s consent and/or a violation of fundamental general principles (such as, inter alia, the so-called “clean hands” principle, the “international public policy” or “transnational public policy”, or the principle that no one shall profit from his/her own wrong) is not convincing for various reasons .

14. The same is true even more – in accordance with recent investment arbitration decisions – if the foreign investor acted corruptly after the investment had already been initiated in the host State.

15. Instead, corruption should be taken into account in the decision on the merits of a case in accordance with the objectives and principles of the international legal order in such a way that central values of investment protection are not disproportionately undermined, but nevertheless relevant disadvantages arise for transnational corporations if they engage in acts of corruption abroad for or during investments. This can be achieved if the amount of investors compensation is reduced for example by a multiple of the sum of the corruption.

16. When considering acts of corruption in the merits of a case, the arbitral tribunal should therefore consider the distribution of responsibility, the pursuit and enforcement of global values, and the bases of legitimacy of the current international legal order, also taking into account the state’s anti-corruption obligations, in particular as enshrined in anti-corruption conventions and human rights treaties.

IV. Concluding remarks

17. The procedural equality of host States and transnational corporations within the framework of an investment arbitration procedure has no implications on the status of transnational corporations in the international legal order as a whole; other views, which argue that transnational corporations are (full or partial) subjects of international law in a normative sense, exceed the – de lege lata – narrowly limited equality.

18. The risks associated with a normative enhancement of transnational corporations in the international legal order present another argument against the view that corporations are (full or partial) subjects of international law. These risks are hinted at in the delegitimization discourse, which grants profit-oriented companies less influence in the international legal order of the 21st century.

19. Even without the status as subjects of international law, transnational corporations can be bound by norms of international law (international law in the narrow sense and so-called soft law). The UN Guiding Principles for the Business and Human Rights are, inter alia, of particular relevance.

20. If – with good reasons – foreign direct investments by transnational corporations continue to be promoted via international law as a means of increasing prosperity in the participating States for the benefit of the respective population, the public-good orientation of international investment arbitration tribunals should be further developed, on the one hand, by reforming the constitutional aspects of the arbitral procedure, and, on the other hand, by further focusing their jurisprudence on public-good aspects including the proportionate protection of responsible investments.

 

Full (German) version: Silja Vöneky, Die Stellung von Unternehmen in der Investitionsschiedsgerichtsbarkeit unter besonderer Berücksichtigung von Korruptionsproblemen – Unternehmen als völkerrechtlich gleichberechtigte Verfahrensparteien?, in: August Reinisch, Stephan Hobe, Eva-Maria Kieninger & Anne Peters (eds), Unternehmensverantwortung und Internationales Recht, C.F. Müller, 2020, pp. 339 et seq.

 

Written by Stefan Huber, University of Tübingen

Note: This blogpost is part of a series on „Corporate social responsibility and international law“ that presents the main findings of the contributions published in August Reinisch, Stephan Hobe, Eva-Maria Kieninger & Anne Peters (eds), Unternehmensverantwortung und Internationales Recht, C.F. Müller, 2020.

1. In investor-state arbitration, one has to distinguish between arbitral proceedings which are initiated on the basis of a contract concluded between the investor and the host state, on the one hand, and arbitral proceedings which are initiated on the basis of a bilateral investment treaty, on the other hand. In the latter case, there is no arbitration agreement in the traditional sense. This entails a unilateral right of the investor to initiate arbitral proceedings. Granting the host state the right to bring a counterclaim might compensate this asymmetry up to a certain degree.

2. Whether the host state has the right to bring a counterclaim, depends on the dispute settlement mechanism provided for in the bilateral investment treaty. For future investment treaties, it is recommended to grant the host state such a right. When the investor introduces arbitral proceedings on the basis of such a treaty, the investor usually declares his consent with the entire dispute settlement clause. If, at this moment, the investor expressly excludes the right of the host state to bring a counterclaim which is provided for in the bilateral investment treaty, there is no correspondence between the declaration of the host state and the declaration of the investor to submit the dispute to arbitration. Consequently, if the host state refuses to participate in the arbitral proceedings on such a basis, the arbitral tribunal does not have jurisdiction to decide the case.

3. The subject matter of treaty-based investor-state arbitration generally concerns regulatory measures of the host state. This makes a considerable difference in comparison to commercial arbitration, which focuses on the interests of private actors. This difference entails different procedural principles, primarily as far as questions of confidentiality and transparency are concerned.

4. There are, however, procedural principles of particular importance, which reflect the cornerstones in a system based on the rule of law in its substantive sense and require, as such, observance in all types of proceedings independently of the subject matter. The principle of equality of arms is one of these principles. Tribunals shall ensure that both parties are in an equal position to present their case. If there is a systemic superiority of one group of parties, tribunals have to be particularly vigilant and, if necessary, to intervene proactively in order to compensate factual inequality.

5. The principle of equal treatment of the parties is not only to be respected within one and the same proceeding. Treating two types of party – states on the one hand and investors on the other – differently in general, i.e. not just in a specific proceeding, would likewise amount to a violation of this principle. If certain questions concerning the burden and standard of proof arise in one procedural situation typically in the interest of the host state and in another procedural situation typically in the interest of the investor, the tribunals should deal with those questions in the same manner.

6. Investments which are in conformity with the law as far as their object is concerned, but which are corruption-tainted due to corruption that took place when the investment was made lead to discussions about the content of international public policy. Against this background, there would appear to be a practice for tribunals to deny jurisdiction or admissibility of the arbitral proceedings in cases concerning corruption-tainted investments. Actually, this leads to a denial of justice. International public policy, however, does not require such an approach. A comparison with the treatment of corruption cases in commercial arbitration shows this very clearly. The circumstances of the individual cases are too manifold; a one-fits-all solution construed at the level of jurisdiction or admissibility is not convincing. The arbitral tribunals should rather undertake a comprehensive analysis on the basis of the applicable substantive rules of law in order to take into account the particular circumstances of each individual case. State interests can be properly respected via mandatory rules and international public policy.

 

Full (German) version: Stefan Huber, Die Stellung von Unternehmen in der Investitionsschiedsgerichtsbarkeit (unter besonderer Berücksichtigung von Korruptionsproblemen) – Unternehmen als gleichberechtigte Verfahrensparteien?, in: August Reinisch, Stephan Hobe, Eva-Maria Kieninger & Anne Peters (eds), Unternehmensverantwortung und Internationales Recht, C.F. Müller, 2020, pp. 303 et seq.

Amazingly, despite the severe crisis in Venezuela, the Master’s Program in Private International Law and Comparative Private Law at the Universidad Central de Venezuela has managed to publish its second Yearbook, with two theses and several impressive shorter pieces by students as well as two new pieces and two “classics” by professors.  (Report on the first yearbook last year is here.)