EAPIL blog

On 19 September 2022, within the framework of the EU-FamPro Project, a conference titled Couples’ Property with Cross-Border Implications: Uniting Academic Discussions and Practical Concerns will be held in Almeria, followed by a seminar on Practical Challenges in the Application of the Twin Regulations. Remote participation is also available.

The conference and the seminar are the two main parts of an event of the EU-FamPro (E-training on EU Family Property Regimes) Project, co-funded by the European Union and conducted by the University of Camerino (coord.), the Law Institute of Lithuania, the University of Almeria, the University of Ljubliana, and the Rijeka University.

The Conference will provide an international forum where the Partners of the Project illustrate the contribution of the E-learning experience to the dissemination and understanding of the recent EU regulations on matrimonial property and property of registered partnerships (Twin Regulations), while academics, policymakers, and practitioners exchange their views on the different roles of legal professionals applying EU family property law.

The Seminar will focus on specific and cross-cutting issues related to the application of the Twin Regulations. The presentations are planned to cover the application of the Twin Regulations in the different national experiences, especially with regard to jurisdictional rules, determination of applicable law and party autonomy. Specific attention will also be given to the interaction of property regulations and Regulation on Succession.

Further info on the event is available on the Project website and the event programme is available here.

The International Institute for the Unification of Private Law (Unidroit) is conducting an online consultation on the draft Model Law on Factoring.

The online consultation will run for 12 weeks, from 29 July until 21 October 2022.

The purpose of the consultation is to: (1) Raise awareness about the instrument; (2) Ensure that the instrument is well suited to application in different contexts, including both civil law and common law jurisdictions as well as developing economies, emerging markets, and developed economies; (3) Seek feedback from parties engaged in factoring on whether the instrument sufficiently addresses issues that arise under existing legal frameworks and will improve factoring arrangements in those States that implement the Model Law; (4) Solicit comments on the drafting of the instrument itself.

The public consultation has three aspects:

1. The launch of this webpage on the UNIDROIT website allowing interested parties to access the draft Model Law on Factoring and facilitating the submission of comments.
2. The circulation of the draft Model Law on Factoring directly to interested parties.
3. The organisation of one or more consultation events to discuss the content of the draft instrument with stakeholders.

Further information, including on the draft Model Law on Factoring itself, is available here.

This post was contributed by Dr. Vincent Richard, who practices with Wurth Kinsch Olinger in Luxembourg.

The end of the summer is the right time to draw readers’ attention to the recent entry into force in all EU Member States except Denmark of the Evidence Regulation recast on 1 July 2022 (Regulation 2020/1783).

The Evidence Regulation facilitates the cross-border taking of evidence by allowing a court or authority to request a court located in another Member State to take evidence there. The Regulation also allows courts to take evidence directly from another Member State after having asked permission from the central authority of that Member State.

The main goal of the recast is to bring the Evidence Regulation into the digital era by imposing that all communications and exchanges of documents should be carried out through a decentralised IT system such as e-CODEX and by encouraging the taking of evidence through videoconferencing. Additionally, the recast facilitates the direct taking of evidence and it introduces interesting changes to the notion of “court” under the Regulation.

The main objective of the recast is to impose an electronic transmission of requests and documents among courts using the Evidence Regulation. To that end, Article 7 (former Article 6 of Regulation 1206/2001) was entirely modified to provide for a fully dematerialised procedure and to allow electronic signatures, governed by Regulation no 910/2014 on electronic identification.

Communication between courts relies on the e-CODEX system, which is a decentralised and interoperable system for cross-border communication, allowing secure communication between preapproved and identifiable users such as judges and clerks. The e-CODEX system has already been used to connect the commercial registers of the Member States and in several pilot projects. The solution has been tested by a limited number of States in the application of the European Payment Order, Small Claims and European Account Preservation Order Regulation. The Regulation on the taking of evidence and the Regulation on the service of documents are the first texts on judicial cooperation in civil matters to require Member States to deploy access points to the e-CODEX system, but the Commission wishes to generalize the method, both in civil and criminal matters. On this issue, the reader may consult a recent blog post by Marta Requejo on the entry into force of the e-CODEX Regulation.

Because of the technical difficulties that this transformation entails, the relevant article (Article 7) did not enter into force in July 2022 with the rest of the Regulation but it will enter into force in 2025, three years after the adoption of the implementing regulation defining technical specifications (Commission implementing regulation (EU) 2022/422 of 14 March 2022).

Where the taking of evidence requires the hearing of a person who is not in the territory of the requesting court, the Regulation encourages Member States to use videoconferencing whenever possible (Articles 12 and 20). This technology can be used to hear a party, a witness, an expert or even a child in the context of the application of Regulation 2019/1111. The recast encourages the use of videoconferencing, whether the taking of evidence is carried out by the requested court or directly by the requesting court.

Article 2 of the recast provides two definitions. One on the “decentralised IT system” and one on the notion of “court”. The latter definition is worth mentioning because it aimed to close the debate as to whether notaries can use the Evidence Regulation. (On the broader issue of notaries in EU PIL, see the post by Martina Mantovani on this blog, here)

Under the recast, the notion of court encompasses not only courts per se but also “other authorities in Member States as communicated to the Commission under Article 31(3), that exercise judicial functions, that act pursuant to a delegation of power by a judicial authority or that act under the control of a judicial authority, and which are competent under national law to take evidence for the purposes of judicial proceedings in civil or commercial matters”.

Hence, Member States are free to delegate the taking of evidence to notaries or court clerks and other Member States must respect this choice as long as it was communicated to the Commission. Recital 5 specifies that this definition includes authorities that qualify as courts under other Union legal acts, such as Brussels I bis, Brussels II ter and the Succession Regulation.

Article 19 to 21 of the recast further encourages requesting courts to use direct taking of evidence after asking permission from the central authority where the evidence is located. If that central body does not answer within 30 days of acknowledgement of receipt of the request, article 19(5) provides that the requesting court may send a reminder. Interestingly, if the requesting court does not receive a reply within 15 days of the acknowledgement of receipt of the reminder, the request for the direct taking of evidence shall be considered accepted. The Regulation, therefore, provides that the silence of the central body is equivalent to implicit acceptance of the taking of evidence on its territory. Exceptionally, the central body may, however, still refuse the taking of evidence after the deadline until the moment of the actual direct taking of evidence.

The Evidence Regulation has never been used much but it remains a useful tool at the disposal of judges and counsels who need to gather evidence abroad in cross-border disputes. The introduction of the e-CODEX system and the use of videoconferencing should speed up the process of obtaining evidence abroad.

Moreover, the recast foreshadows the method that will be followed in judicial cooperation in the coming years and it will be interesting to observe the implementation of e-CODEX in all Member States.

The European Commission has announced that the European Union and Ukraine both joined the 2019 Hague Judgments Convention today. More specifically, the EU has acceded and Ukraine has ratified the Convention on 29 August 2022.

Didier Reynders, EU Commissioner for Justice, said:

Today‘s accession is the culmination of years of intense efforts. By being the first to accede to the Convention together with Ukraine, the European Union paves the way for others to join soon. The wider the accession rate of States to the Hague Judgments Convention, the more powerful an instrument it will become for the benefit of more citizens, more companies, and wider international trade and investment.

The Convention will enter into force for the EU and Ukraine on 1 September 2023.

A delicate question will then be whether EU Member States will apply the Convention to judgments issued by courts located in any part of Ukraine under Russian “control” (whatever that may mean, and if any by then).

Unless Russia, which has signed the Convention, becomes a Contracting State in the meantime.

Following the abolition of exequatur by the Brussels I bis Regulation (Article 39), a new model (application for refusal of enforcement, Articles 46-51) has been introduced. So far, case law has been scarce in the vast majority of Member States. Greece was no exception to the rule.

A dispute between a Cypriot and a Greek company led to a series of judgments, which demonstrate the problems of mixing EU with domestic procedures. The facts of the case are complicated, at least for Greek practice standards, departing from the average scheme of creditor v debtor.

Stage 1: Cyprus

The case began in Cyprus. A Cypriot aviation company (creditor = C) started litigation against another Cypriot company before the district court of Nicosia (debtor 1 = D1). C requested the return of a Cessna aircraft, of which it was the owner. The aircraft was leased to D1. The latter did not appear in the proceedings. The default judgment was served to D1. At some point, C was informed that the aircraft was not anymore in Cyprus. D1 had subleased the aircraft to a private aviation company situated in Thessaloniki (debtor 2 = D2).

Stage 2: Greece

In light of the above circumstances, C filed an action against D2 before Thessaloniki courts. However, ordinary proceedings do not offer chances of a speedy dispute resolution. Indeed, the hearing of the action is scheduled to take place end September 2022. C had not time to lose. It obviously was in a dire need to get hold of the aircraft as soon as possible. Therefore, five days after filing the action, C decided to follow a different path: It served both the judgment and the certificate of Article 53 of the Brussels I bis Regulation (issued by the Nicosia court) to D2, requesting the return of the aircraft, in accordance with the order of the Cypriot court.

Stage 3: The remedies of D2

Faced with the sword of Damocles, D2 opened three sets of proceedings: an application for refusal of enforcement; an action to oppose execution (five days after filing the above application); an application to suspend enforcement (filed same day with the action).

The grounds of defence were identical: Some of the grounds referred to the classic impediments featured under Article 45 of the Brussels I bis Regulation, namely public policy and violation of the right to be heard, aiming at the refusal of enforcement. The remaining grounds challenged the execution proceedings.

The rulings of the Thessaloniki courts:

1. The first decision (Thessaloniki Court of first Instance, 19 November 2021, unreported) concerned the action to oppose execution. The court did not enter into the merits of the case. It stated that, taking into account the melange of grounds against enforceability and enforcement, it must stay proceedings, until the court seised with the application for refusal of enforcement renders its ruling. The court underlined that it had no powers to examine the grounds against the execution proceedings, because D2 explicitly requested the court to examine the latter grounds (i.e., those against execution proceedings), only if it rejects the former. (i.e., those against enforceability)
2. The second decision (Thessaloniki Court of first Instance, 16 February 2022, unreported) concerned the application for refusal of enforcement. Again, the court did not enter into the merits of the case. A number of issues were in need of clarification, so that the court could render judgment. Therefore, the court ordered the stay of proceedings, requesting evidence with respect to the following issues:

First, the court was not aware of the right of D2 to challenge the Cypriot judgment in the state of origin, pursuant to Cypriot law of civil procedure.

Second, the court was not aware of the Cypriot provisions on the service of process to legal entities.

Third, the court requested the original certificate of the service of process to D1.

Fourth, the court requested the production of a document, which will certify whether the Cypriot judgment is final and conclusive

3. The third decision (Thessaloniki Court of first Instance – summary proceedings, 9 March 2022, unreported) concerned the application to suspend enforcement. It focused on the defence raised by D2 with respect to the certificate under Article 53. Upon scrutiny of the certificate, the court traced two defects: First, the certificate stated that the judgment was rendered in contradictory proceedings, although the judgment was given in default of appearance, as evidenced in the judgment issued by the Nicosia court. Second, the certificate did not include the date of service. The above were considered as vices of the enforceable foreign judgment, on the grounds of which the execution is founded. Therefore, the court ordered the temporary stay of execution, until the judgment on the action to oppose execution id rendered. NB: No reference was made to Article 44 Brussels I bis Regulation

On a European level, judgments dealing with refusal of enforcement under the Brussels I bis Regulation are a sheer rarity. This may be evidenced by reading the reports published in the JUDGTRUST and EFFORTS projects.

Greece has not taken steps to clarify the landscape concerning Article 47 Brussels I Regulation. Greek legal scholarship supports unanimously the right of the judgment debtor to file a single remedy, challenging both enforceability and enforcement, i.e., an action to oppose execution. This has been accepted by the courts in the case at hand. However, D2 opted for the opposite solution: Applying prevailing lawyer tactics, it filed two separate documents, accumulating all possible grounds in each of them. It didn’t work the way it was expected. Luckily, D2 managed to suspend execution. Hence, the battle is still on ground zero. More judgments will follow, most probably reaching the Supreme Court.

Given that the courts did not enter into the merits (save the court ordering suspension of execution based on substantial evidence / the balance of probabilities), many intriguing issues are left unanswered: The right of C to initiate execution against a non-litigant in the country of origin; the obligation of D2 to challenge the Cypriot decision, without being a party to the proceedings; the significance of the errors found in the certificate under Article 53 on the level of enforceability. These are matters which will surely be scrutinized by the courts in the forthcoming proceedings. However, before concluding this post, it should be mentioned that the courts referred to three core rulings of the CJEU, offering guidance for the next set of litigation, namely the ruling of 2016 in the case of Rudolfs Meroni v Recoletos, the ruling of 2015 in the case of Diageo Brands BV, and the ruling of 2012 in Trade Agency.

P.S. A recent decision of the Thessaloniki Court of first instance, issued at the end of December 2021, examined the application for refusal of the Greek company against the enforcement of a judgment issued by the court of Reggio Emilia in 2021. More information about the case is available here.

The latest issue of the IPRax (Praxis des Internationalen Privat- und Verfahrensrechts) will be published on 1 September 2022. It contains a number of interesting articles and case comments regarding issues of jurisdiction and applicable law. The table of contents is available here. The following abstracts have been kindly provided to us.

J. Richter, Cross-border service of writs of summons according to the revised EU Service Regulation

The service of judicial documents, particularly the service of writs of summons, is of central importance in civil proceedings. In cross-border proceedings, service of legal documents poses particular problems, which are addressed by the European Regulation on the Service of Documents. The revision of this regulation, which will enter into force on 1 July 2022, provides an opportunity to examine the current and future rules by taking the example of the international service of writs of summons.

G. van Calster, Lex ecologia. On applicable law for environmental pollution (Article 7 Rome II), a pinnacle of business and human rights as well as climate change litigation

The European Union rules on the law that applies to liability for environmental damage, are an outlier in the private international law agenda. EU private international law rules are almost always value neutral. Predictability is the core ambition, not a particular outcome in litigation. The rules on applicable law for environmental damage, contained in the Rome II Regulation on the law that applies to non-contractual obligations, are a clear and considered exception. Courts are struggling with the right approach to the relevant rules. This contribution maps the meaning and nature of those articles, their application in case-law, and their impact among others on business and human rights as well as climate change litigation.

M. Castendiek, “Contractual” rights of third parties in private international law

Although contractual rights are usually limited to the parties, almost all jurisdictions in Europe recognize exceptions of this rule. Whereas those “contractual” rights of third parties are strictly limited in common law countries, German and Austrian Law even extend contractual duties of care on third persons related to the parties. Prior to the Rome Regulations, the conflict-of-law judgments on those “contracts with protective effect in favour of third parties” differed between German and Austrian courts.
The article points out that a consistent jurisdiction on this issue needs a clear distinction between contractual and non-contractual rights even between the parties of the contract. It points out that the Regulation Rome I covers only obligations that would not exist without the contract. Those obligations remain contractual even if they entitle a third party.
“Contractual” duties of care corresponding with negligence in tort, on the other hand, fall within the scope of the Regulation Rome II. For the contracting parties as well as for third parties, the conflict-of-laws in claims following the disregard of such duties is determined by the application of Article 4 Regulation Rome II. The article provides criteria to determine whether the close connection rule in Article 4(3) Regulation Rome II can lead to the application of the law governing the contract.

C. von Bary, News on Procedural Consumer Protection from Luxemburg: Consumer Status and Change of Domicile

In two recent decisions, the CJEU continues to refine the contours of procedural consumer protection in cross-border disputes. In the case of a person who spent on average nine hours a day playing – and winning at – online poker, the court clarified that factors like the amount involved, special knowledge or the regularity of the activity do not as such lead to this person not being classified as a consumer. It remains unclear, however, which criteria are relevant to determine whether a contract is concluded for a purpose outside a trade or profession. Further, the CJEU stated that the relevant time to determine the consumer’s domicile is when the action is brought before a court. This seems to be true even if the consumer changes domicile to a different member state after the conclusion of the contract and before the action is brought and the seller or supplier has not pursued commercial or professional activities or directed such activities at this member state. This devalues the relevance of this criterion to the detriment of the professional party.

W. Voß, The Forum Delicti Commissi in Cases of Purely Pecuniary Loss – a Cum-Ex Aftermath

Localising the place of damage in the context of capital investment cases is a perennial problem both under national and European civil procedural law. With prospectus liability having dominated the case law in the past decades, a new scenario is now increasingly coming into the courts’ focus: liability claims resulting from cum-ex-transactions. In its recent decision, the Higher Regional Court of Munich confirms the significance of the place of the claimant’s bank account for the localisation of purely financial loss in the context of sec. 32 German Civil Procedure Code but fails to provide any additional, viable reasoning on this notoriously debated issue. The decision does manage, however, to define the notion of principal place of business as delimitation of the scope of application of the Brussels regime convincingly. Incidentally, the text of the judgment also proves an informative lesson for the recently flared-up debate about anonymization of judicial decisions.

L. Hornkohl, International jurisdiction for permission proceedings under the German Telemedia Act (TMG) in cases of suspected abusive customer complaints on online marketplaces

In its decision of 11 March 2021, the Cologne Higher Regional Court denied the international jurisdiction of the Cologne courts for permission proceedings under the German Telemedia Act (TMG) in cases of suspected abusive customer complaints in online marketplaces. The Cologne court decision combined several precedents of the German Federal Court and the European Court of Justice. Although the Cologne Higher Regional Court decided that permission proceedings constitute a civil and commercial matter within the meaning of the Brussels I Regulation, international jurisdiction could not be established in Germany. The place of performance according to Art. 7 No. 1 lit. b second indent Brussels Ibis Regulation must, in case of doubt, uniformly be determined at the place of establishment of the online marketplace operator in Luxembourg. Article 7 No. 2 of the Regulation also does not give jurisdiction to German courts. The refusal to provide information per se is not a tort in the sense of Article 7 No. 2. Furthermore, there is no own or attributable possibly defamatory conduct of the platform operator. Contradictory considerations of the German legislator alone cannot establish jurisdiction in Germany.

A. Spickhoff, Contract and Tort in European Jurisdiction – New Developments

The question of qualification as a matter of contract or/and of tort is among others especially relevant in respect to the jurisdiction at place of performance and of forum delicti. The decision of the court of Justice of the European Union in res Brogsitter has initiated a discussion of its relevance and range to this problem. Recent decisions have clarified some issues. The article tries to show which. The starting point is the fraudulent car purchase.

R.A. Schütze, Security for costs for UK plaintiffs in German civil proceedings after the Brexit?

The judgment of the Oberlandesgericht Frankfurt/Main deals with one of the open procedural questions of the Brexit: the obligation of plaintiffs having permanent residence in the United Kingdom to provide security of costs in German civil proceedings. The Court has rightly decided that from January 1st, 2021 plaintiff cannot rely on sect. 110 par. 1 German Code of Civil Procedure (CCP) anymore as the United Kingdom is no longer member of the EU. If the plaintiff has lodged the complaint before January 1st, 2021, the obligation to provide security of costs arises at that date and security can be claimed by respondent according to sect. 110 CCP. However, the Court has not seen two exceptions from the obligation to provide security for costs according to sect. 110 par. 2 no. 1 and 2 CCP which relieve plaintiff from the obligation to provide security of costs if an international convention so provides (no. 1) or if an international convention grants the recognition and execution of decisions for costs (no. 2). In the instant case the court had to apply art. 9 par. 1 of the European Convention on Establishment of 1955 and the Convention between Germany and the United Kingdom on Recognition and Execution of Foreign Judgments of 1960, both Conventions not having been touched by the Brexit. Facit therefore: claimants having permanent residence in the United Kingdom are not obliged to provide security for costs in German Civil proceedings.

H. Roth, Qualification Issues relating to § 167 Civil Procedure Code (Zivilprozessordnung, ZPO)

§ 167 of the Civil Procedure Code (ZPO) aims to relieve the parties of the risk accruing to them through late official notification of legal action over which they have no control. This norm is part of procedural law. It is valid irrespective of whether a German court applies foreign or German substantive law. The higher regional Court (Oberlandesgericht) of Frankfurt a.M. found differently. It holds that § 167 should only be considered when German substantive law and thus German statute of limitations law is applied.

A. Hemler, Undisclosed agency and construction contract with foreign building site: Which law is applicable?

Does the term “contract for the provision of services” in Art 4(1)(b) Rome I Regulation include a building contract with a foreign building site? Or should we apply the exception clause in Art 4(3) Rome I Regulation if the building site is abroad? Which law governs the legal consequences of undisclosed agency, i.e. how should we treat cases where a contracting party acts as an agent for an undisclosed principal? Furthermore, what are the legal grounds in German law for a refund of an advance payment surplus in such a building contract? In the case discussed, the Oberlandesgericht (Higher Regional Court) Köln only addressed the latter question in detail. Unfortunately, the court considered the interesting PIL issues only in disappointing brevity. Therefore, based on a doctrinal examination of the exception clause in Art 4(3) Rome I Regulation, the paper discusses whether the scope of the general conflict of laws rule for contracts for the provision of services should exclude building contracts with a foreign building site by virtue of a teleological limitation. It also sheds light on the dispute around the law governing cases of undisclosed agency. The paper argues that Art 1(2)(g) Rome I Regulation is not applicable in this regard, i.e. the issue is not excluded from the Rome I Regulation’s scope. Instead, it is covered by Art 10(1) Rome I Regulation; hence, the law governing the contract remains applicable.

S.L. Gössl, Uniqueness and subjective components – Some notes on habitual residence in European conflict of laws and procedural law

The article deals with the case law of the ECJ on the habitual residence of adults, as addressed in a recent decision. The ECJ clarified that there can only ever be one habitual residence. Furthermore, it confirms that each habitual residence has to be determined differently for each legal acts. Finally, in the case of the habitual residence of adults, subjective elements become more paramount than in the case of minors. In autonomous German Private International Law, discrepancies with EU law may arise precisely with regard to the relevance of the subjective and objective elements. German courts should attempt to avoid such a discrepancy.

D. Wiedemann, Holidays in Europe or relocation to Bordeaux: the habitual residence of a child under the Hague Convention on International Child Abduction

A man of French nationality and a woman of Chilean nationality got married and had a daughter in Buenos Aires. A few months after the birth of their daughter, the family travelled to Europe, where they first visited relatives and friends and finally stayed with the man’s family in Bordeaux. One month and a few days after they arrived in Bordeaux, mother and daughter travelled to Buenos Aires and, despite an agreement between the spouses, never returned to Bordeaux. The father in France asked Argentinean authorities for a return order under the HCA. According to the prevailing view, the HCA only applies, if, before the removal or retention, the child was habitually resident in any contracting state except for the requested state. The court of first instance (Juzgado Civil) assumed a change of the child’s habitual residence from Argentina to France, but, considering that the lack of the mother’s consent to move to France results in a violation of the Convention on the Elimination of All Forms of Discrimination against Women, it granted an exception under Art. 20 HCA. The higher court (Cámara Nacional de Apelaciones en lo Civil) and the Argentinian Supreme Court (Corte Suprema de Justicia de la Nación) required the manifestation of both parents’ intent for a change of the child’s habitual residence. The higher court saw a sufficient manifestation of the mother’s intent to move to France in the termination of her employment in Buenos Aires and ordered the return. In contrast, the CSJN refused to give weight to the termination of employment as it happened in connection with the birth of the daughter.

H.J. Snijders, Enforcement of foreign award (in online arbitration) ex officio refused because of violation of the defendant’s right to be heard

With reference to (inter alia) a judgement of the Amsterdam Court of Appeal, some questions regarding the consideration of requests for recognition and enforcement of foreign arbitral awards in the Netherlands are discussed. Should the State Court ex officio deal with a violation of public order by the arbitral tribunal, in particular the defendant’s right to be heard, also in default proceedings like the Amsterdam one? In addition, which public order is relevant in this respect, the international public order or the domestic one? Furthermore, does it matter for the State Court’s decision that the arbitral awards dealt with were issued in an online arbitration procedure (regarding a loan in bitcoin)? Which lessons can be derived from the decision of the Amsterdam Court for drafters of Online Arbitration Rules and for arbitral tribunals dealing with online arbitration like the arbitral e-court in the Amsterdam case? The author also points out the relevance of transitional law in the field of arbitration by reference to a recent decision of the Dutch Supreme Court rejecting the view of the Amsterdam Court of Appeal in this matter; transitional law still is dangerous law.

This post was authored by François Mailhé, who is Professor of Private Law at the University of Picardie Jules Verne. It is the fourth in a series of posts regarding the ruling of the European Court of Justice, of 20 June 2022, in the case of London Steam-Ship Owners’ Mutual Assistance Association Ltd v Spain. The first post was contributed by Adrian Briggs, the second one by Gilles Cuniberti, and the third one by Antonio Leandro.

Much has already been said on this case and this post does not contend to address all the issues both dealt with and raised by the decision.

Rather, I would like to submit, as a summer food for thought, a topical methodological problem exampled by this decision after several others: that of the bias tending to analyse all problems through the articles of the Regulation at stake. More precisely, I would suggest Brussels I as a whole shouldn’t have been applied in that case and that the reason for those opposite findings by the ECJ can also be explained because it preferred interpreting article 34 rather than the scope of the Regulation as a whole.

It all starts with what I contend to be a poorly presented prejudicial question. It did ask whether, first, the English decision at stake was a “judgment” preventing recognition of the Spanish decision under Article 34 of Brussels I, second if it may be such even if it was taken in accordance with the Arbitration Act 1996. The question therefore focused on Article 34 and, by doing so, begged for the answer.

Indeed, if one looks at the issue through Article 34 and the notion of irreconcilability, then the Hoffmann case, on Article 34’s ancestor, Article 27 Brussels Convention, is the relevant case-law. In that decision, the ECJ held that a decision on the status of a natural person, a matter outside the scope of the Convention, could still be considered from Article 27 perspective as long as it “entailed legal consequences which were mutually exclusive” with the other judgment. It was a very pragmatic decision, allowing to solve the conflict between Article 27 (that solved the problem) and Article 1 (on the scope of the Convention). It allowed to disregard the subject-matter of the judgment if it may have consequences in the field of what was the Brussels convention at the time. Disregarding the arbitration exclusion was, therefore, an obvious choice considering the phrasing of the question.

What is more, asking whether Article 34 could be applied even if the judgment had a specificity under national law (the Arbitration Act 1996) was also a good way to get a specific answer. National specificities are obviously irrelevant.

What was relevant, though, was the topic of this national act: arbitration. There lied the problem.

Article 1(2) had been forgotten in the question and bypassed too quickly by the Court in its answer, who considered the problem was identical to that in Hoffmann. But what worked for 1(2)(a) was not adapted to all other exclusions of Article 1(2). Relevant for a conflict of substance (status of natural persons, succession and wills, etc.) since its solution eventually only considers substance (that of the consequences of those conflicting decisions), it is hardly adapted to procedural exceptions. Arbitral awards, and therefore decisions about them, intervene almost by essence on contractual and liability matters, all matters dealt with by the Regulation. Most often, the final decision will be about such remedies as liability and damages, or avoidance of a contract. How may such a decision not be conflicting with other judicial decisions between the same parties and matters?

The problem of arbitration is that it is not a different matter, hence no different decisions, but a different procedure. Using an analysis of the substance of any final award and an associated judgment therefore amounts to strip the arbitral aspect of the litigation and to deprive the exclusion clause of article 1(2)(d) of the Regulation of any effet utile. One may just have to compare with what could have been the reasoning with a judgment pronounced within the scope of the Insolvency Regulation recast. There again, comparing the substance of the decisions would have revealed a potential conflict between mutually exclusive legal consequences, and therefore, according to that line of reasoning, the exclusion of the Insolvency Regulation…

Falling back on Article 34 and the Hoffmann decision was therefore too simple a way to bypass the arbitration issue. In the conflict between the problem to solve and the scope of the Regulation, the latter is obviously to be addressed first. Indeed, there is no real conflict: there was no question, once Brussels I would have been declared applicable, that the issue would have to be solved by Article 34… The question of the scope of a Regulation arises first since its rules only play within its limits. And the London Steam-Ship case shows how such a line of reasoning is not only an issue of logic, but also of policy. The policy issue, indeed, was not the narrow interplay between two such decisions, but rather the scope of the arbitration exclusion in Brussels I, an issue that has not always been clearly addressed. This issue of the limits of the Regulation itself should have been at the core of the prejudicial question, not the conditions of Article 34 facing a specific judgment.

It is not the first time such a narrow analysis is at play, though. One may remember, for example, the Owusu decision. Where, in that decision, the question was whether or not forum non conveniens was compatible with the Convention, the Court went in depth as to the “imperative” nature of the sole Article 2 of the Convention to reject it. This method prevented the Court to pose a principle of exclusion of forum non conveniens within the scope of the Brussels Convention itself, a solution far simpler (and more efficient) than interpreting its Article 2, which was not answering that problem at all. Indeed, resorting to specific articles of the Regulation, silent on new issues, often leads to just ignoring them.

I do not know whether, at least in this London Steam-Ship case, the Court was perfectly aware of this methodological choice. But it is that of a young Court, applying a young law. A French author cannot but think of the exegetic school of French law that endured in case-law for decades after the Code civil was enacted, restricting itself to the strict meaning of its articles even when new issues arose. This is what the ECJ did, here again, by preferring to interpret the technical rule rather than trying a systemic analysis.

The Court has found maturity in other branches of European law, displaying much subtility and a much wider vision to address complex issues. Private international law, as this other branch of law harmonising relations between member State laws, could benefit from such a change in perspective.

The latest issue of GRUR International (Journal of European and International IP Law) features an article by Pedro De Miguel Asensio, titled Protection of Reputation, Good Name and Personality Rights in Cross-Border Digital Media”.

The abstract reads:

Following the recent judgments of the Court of Justice in Mittelbayerischer Verlag and Gtflix tv, this paper analyses the European Union framework in relation to the enforcement of rights relating to personality, including those of legal persons, against harmful content posted online. As regards jurisdiction, special attention is given to the scope of the centre of interest of the victim as ground for jurisdiction. Furthermore, the fragmentation that results from attributing jurisdiction to the courts of the place(s) where the damage occurs under the so-called mosaic approach is discussed. Particular attention is devoted to the difficulties that arise in relation to the broad understanding by the Court of Justice of the place where the damage occurs as the connecting factor and its position regarding the mere accessibility of online content as the decisive element for determining jurisdiction. Additionally, the interplay between jurisdiction and choice of law and its implications on the territorial scope of orders and the cross-border recognition of judgments are considered.”

Further information can be found here.

This post was written by Stefan Leible and Felix M. Wilke (both University of Bayreuth). It is the fourth in a series of posts on the French draft code of private international law of March 2022 (the previous posts in the series discussed the issues of renvoi, foreign law and the recognition of marriages celebrated abroad). It is based on an article by the authors (in French) forthcoming in the Revue critique de droit international privé. The English manuscript of that article can be found SSRN here (SSRN).

The outlook that France might soon have a full private international law (PIL) code can cause some envy in a German PIL scholar. After all, Germany does not have – nor will it have it in the foreseeable future – such a code. To be sure, a big part of German conflict-of-laws provisions can be found in one place, i.e. the Introductory Act to the Civil Code (EGBGB). But this Act overall is not limited to PIL issues. Moreover, there is no piece of legislation exclusively and comprehensively devoted to questions of cross-border proceedings in civil matters. International jurisdiction outside the scope of EU law typically must be determined by applying the rules for local jurisdiction/venue “double-functionally” (on the prevalence of this concept in the EU, see the project (see here). And while the German Code of Civil Procedure (ZPO) expressly addresses other cross-border issues (such as service abroad or recognition and enforcement of foreign decisions), it only does so in the context of the respective subject matter (e.g. service in general and effects of decisions in general). Hence, these provisions are scattered across the Code.

Nevertheless, we hope some remarks from a German perspective may be of interest. At the risk of coming across as stereotypical German (PIL) scholars, we focus on the General Part of the Draft Code in this contribution. The readers may rest assured that our forthcoming article in the Revue critique de droit international privé has a broader approach.

The general part (Book I: “General Rules” = Articles 1-33) of the Draft Code contains provisions on conflict of laws as well as on procedure, including four “general general” provisions applying to both areas. The idea of “factoring out” provisions in this way obviously speaks to us, with the German Civil Code (BGB) arguably being the pinnacle of this legislative technique. True, to organize provisions in this way can run contrary to the accessibility of a legal instrument and therefore could be detrimental to one of the main goals of the Draft Code (see the Report of the Working Group (“Report”), p. 7). As the level of abstraction is still rather low, however, the advantage of not having to repeat the same provisions over and over (or at least to insert a plethora of references across the code) outweighs this risk. Furthermore, some of the general issues of PIL tend to appear to outsiders as arcane. Hence, it is beneficial for legal clarity to make some of them explicit.

The general part in the field of conflict of laws contains many of the usual suspects. It comes as no surprise in particular that there are provisions on renvoi (Article 8 of the Draft Code) and public policy (Article 11 of the Draft Code); we are not aware of any code of private international law anywhere in the world that fails to address these issues. It is commendable that a provision on characterisation (Article 6 of the Draft Code) has been drafted, following trends in other countries. The basic German approach (characterisation lege fori) is the same as in the Draft Code, but there is no provision to this effect. Of course, one of the main problems with characterisation concerns institutions unknown to the lex fori. Special conflict-of-laws provisions for such institutions make life much easier. It is thus a very good idea to have included provisions on trusts in the special part (Articles 107-114 of the Draft Code).

Article 8 of the Draft Code on renvoi has already been the subject of an insightful post by Gilles Cuniberti on this blog. We are in agreement with him that the respective reference in the Report to insights from comparative (private international) law are vague and misleading. We can add that Germany would be another example of national PIL allowing renvoi in general (Article 4(1) EGBGB).

We do not think that legal clarity is improved by making renvoi mandatory only if one of the parties so requests (Article 8 cl. 2 of the Draft Code). This would mean that applicable law at least for a considerable time has the sword of Damocles hanging over its head: Assuming that application of renvoi would lead to a different applicable law than if renvoi was excluded, the applicable law ultimately would be subject to one party choosing to “trigger” the application of renvoi or not. And why should one party have the unilateral power to change the applicable law in this way, possibly to the detriment of other parties?

Article 7(1) of the Draft Code contains a definition of lois de police (overriding mandatory provisions). Paragraph 2 sets forth that French overriding mandatory provisions must be applied; pursuant to paragraph 3, foreign overriding mandatory provisions can be applied under certain conditions. The legislative technique thus is rather similar to Article 9 Rome I. There is no comparable provision in the EGBGB (Article 34 EGBGB – implementing the respective provision of the Rome Convention – was abolished at the end of 2009). Again, we consider it beneficial for legal clarity to have a written rule on this issue.

But the function of Article 5(2) of the Draft Code is not clear to us in this regard. It states that a conflict-of-laws rule is “excluded” (écartée) by a material rule for certain international situations or by an overriding mandatory provision. Why is this statement even needed if Article 7(2) and (3) of the Draft Code contain precise instructions of how to deal with overriding mandatory provisions? Additionally, we object to the idea arguably expressed in Article 5(2) of the Draft Code that a rule of substantive law can take precedence over a conflict-of-laws rule. This would mean to conflate two areas of law that – analytically speaking – must be strictly kept apart.

While the German EGBGB with only four articles in the section on “General Provisions” does not serve as an inspiring example in this context, one might consider addressing even more issues in the general part of the Draft Code. (The Report does not indicate whether this was on the Working Group’s agenda.) In particular, we are thinking of the incidental question and the triad of adaptation, substitution and transposition. All of them concern a stage in the analysis of a case in which the applicable law has seemingly already been determined. There is a certain risk that especially those not well-versed in PIL could overlook that not necessarily all aspects of the case will be governed by the law just determined and/or that some adjustments still must be made under substantive law. To include provisions on these issues, even if phrased rather broadly, could at least draw attention to them. And the French PIL Code could be something of a trailblazer here.

A conference titled The Brussels I bis Reform will take place on 9 September 2022, between 8:30 am and 4:30 pm (CEST), organised by the Max Planck Institute Luxembourg.

Regulation (EU) 1215/2012 is the fundamental reference-instrument of cross-border judicial cooperation in civil matters within the European Union. It provides rules on jurisdiction, pendency, recognition, and enforcement of judgments and other enforceable titles. Since its establishment in 1968, it has been a constantly evolving instrument. At present, the European Commission is required to present a report on the application of the Regulation and to propose improvements. Against this background, a Working Group was set up within the network of the European Association of Private International Law (EAPIL) to draft a position paper. The group is led by Burkhard Hess (Luxembourg) and Geert van Calster (Leuven). Members of the working group answered a questionnaire, reporting the application and possible shortcomings of the Brussels Ibis Regulation in their respective jurisdictions.

Speakers include Dario Moura Vicente, Björn Laukemann, Vesna Lazić, François Mailhé, Stefaan Voet, Camelia Toader, Chrysoula Michailidou, Alexander Layton, Matthias Weller, Krzysztof Pacula, Marta Requejo Isidro, Viktória Harsági, Gilles Cuniberti and Marco Buzzoni.

The topics of the conference are based on the reports received from working group members and observers. Many of the reporters will have the opportunity to take up issues they indicated as important. Additional experts will present topics ranging from insolvency proceedings to third state relationships. Most importantly, the conference will provide a forum for all attendees to discuss the application of the Brussels I bis Regulation up until now and the need for future improvements. The aim of the conference is to prepare a position paper.

The paper will be presented to the European Commission to advise it in the evaluation process.

The conference, which is organised in collaboration with the European Association of Private International Law and the University of Leuven, will take place at the premises of the MPI Luxembourg. Digital participation is possible. Registration is on a first come, first served basis.

Those interested in participating are required to register before 26 August 2022.

The 9th Annual International Arbitration Lecture organised by Roma Tre University and Unidroit, will be held at Unidroit, in Rome, and online on 30 September 2022.

The lecture, titled Beyond Nationalists Mirages in Arbitration: The Inescapable Transnational Approach, will be delivered by Diego P. Fernández Arroyo.

Maria Chiara Malaguti (President of Unidroit and Professor at the Catholic University of the Sacred Heart) and Andrea Zoppini (Roma Tre University) will intervene.

For further information and registration see here.

A book titled Domestic Violence and Parental Child Abduction. The Protection of Abducting Mothers in Return Proceedings edited by Katarina Trimmings, Anatol Dutta, Constanza Honorati and Mirela Župan has been published recently by Intesentia.

The book has been prepared under the auspices of the EU-sponsored POAM project and, therefore, is available not only for purchase in paper format, but also in open access in e-book formats and online.

The POAM was a collaborative research project which has explored the intersection between domestic violence and international parental child abduction within the European Union. The project was concerned with the protection of abducting mothers who have been involved in return proceedings under the 1980 Hague Abduction Convention and the Brussels IIa Regulation, in circumstances where the child abduction had been motivated by acts of domestic violence from the left-behind father. The POAM examines the usefulness of the Protection Measures Regulation and the European Protection Order Directive in the context of such return proceedings. The POAM project was led by the University of Aberdeen and involved three partner institutions – the Ludwig Maximilians University of Munich, the Milano-Bicocca University and the University of Osijek.

The abstract of the book reads as follows:

This book focuses on the protection of abducting mothers who have been subject to return proceedings under the 1980 Hague Abduction Convention and the Brussels IIa Regulation, in circumstances where the child abduction has been motivated by acts of domestic violence from the left-behind father. The utility of Regulation 606/2013 on mutual recognition of protection measures in civil matters and Directive 2011/99/EU on the European Protection Order, and how protection measures can be used to protect abducting mothers, are examined within this context. Both instruments allow cross-border circulation of protection measures but, so far, have not attracted much attention in practice. This book aims to fill that gap (…) The book offers a unique perspective on the problem of international parental child abductions committed against the background of domestic violence. Given its practical focus, it will appeal not only to an academic audience but also to judges, legal practitioners and other professionals working in the area of parental child abduction.

The French Ministry of Justice has launched a series of podcasts titled Droit vers l’Europe, presenting key-aspects of EU Judicial Cooperation in civil and commercial matters (in French) for judges and legal practioners.

The objective is to improve their understanding of EU instruments of private international law and thus facilitate their application in cross-border cases.

The introduction of the series reads as follows:

You are a legal professional and you are confronted with a European problem in a family, civil or commercial case? “Droit vers l’Europe” gives you the keys to apply the instruments of EU judicial cooperation. In each episode, an expert sheds light on a specific issue. This podcast will enable you to develop the right practices in the implementation of EU regulations.

The main topics of the series include the following regulations: Brussels I bis Regulation; European order for payment; European account preservation order; Taking of evidence and Service of documents; Circulation of authentic instruments; Handling of international successions; Brussels II bis Regulation and its recast; Applicable law to matrimonial property regimes of international couples; Applicable law to divorce and legal separation; Recovery of maintenance claims; Access to legal aid in cross-border cases.

The initiative is co-funded by the EU.

More information is available here.

Oxford University Press has recently published the secondo edition of European Cross-Border Insolvency Law, by Reinhard Bork and Renato Mangano.

The blurb reads:

The first edition of this textbook was published in 2016, but since then the legal and factual scenario of European cross-border insolvency law has changed dramatically. In particular, three main events have occurred. First of all, the prescriptions of Regulation (EU) 2015/848 (Recast) have become applicable; second, the UK has left the European Union, without this completely reducing the meaning of the regulation for the UK though; and third, the European Union has enacted Directive (EU) 2019/1023 on preventive restructuring and insolvency. Moreover, since 2016, the Court of Justice of the European Union (CJEU) has delivered significant new judgments, albeit regarding the Regulation (EU) 1346/2000; national courts have started applying the prescriptions of Regulation (EU) 2015/848; scholars have produced numerous papers and commentaries on Regulation (EU) 2015/848; and the United Nations Commission on International Trade Law (UNCITRAL) has issued relevant new documents such as the 2018 ‘Model Law on Recognition and Enforcement of Insolvency-Related Judgments’ and the 2019 ‘Model Law on Enterprise Group Insolvency’. The second edition of this textbook maintains its original purpose of providing readers with a user-friendly framework so that they may understand the rationale of Regulation (EU) 2015/848 and be consistent in their application of its prescriptions. However, in order to analyse the impact of the new events and discuss the most recent interpretations of judges and scholars, each chapter has been given new bibliographical references, supplemented with further observations, and, in some cases, even reorganised.

Further information can be found here.

On 25 May 2022, the European Commission published a set of Questions and Answers (Q&As) to clarify the practical implementation of the new sets of Standard Contractual Clauses (SCCs), adopted in June 2021 (Decision 914/2021/EU). Contracts based on the earlier sets of SCCs will no longer be a lawful basis for international data transfers after 27 December 2022 (Q&A No. 22).

As a reminder, SCCs are standardised and pre-approved model data protection clauses that allow controllers and processors to comply with their obligations under EU data protection law. They are based on a triangular relationship, whereby the obligations assumed by the data importer and the data exporter (the parties to the contract) by virtue of their contractual agreement can be enforced by the data subject, acting as a third-party beneficiary.

SCCs are, by definition, incorporated within an international contract between a controller/processor of personal data established in the EU (or subject to the GDPR pursuant to Article 3(2) thereof) and a controller/processor established in a third country and placed beyond the scope of application of the GDPR (cf Q&A No. 24). Owing to their congenital “foreign element”, these contracts must speak the language of private international law (PIL), at least in cases where they are concluded between two commercial entities (see Q&A No. 2 for the potential range of users of the SCCs). In this respect, the Commission’s Q&As bring along welcome clarifications concerning some of most recurrent PIL issues arising out of these clauses, such as those regarding the contents and limits of conflict-of-laws party autonomy and the interplay between these contracts and the legal order (notably, the overriding mandatory rules) of the receiving third country.

While being of certain interest for the private international lawyer, the relationship between local laws (objectively applicable to the data importer) and the SCCs remains extremely complex and it deserves its own blogpost. For this reason, Section A of this blogpost will briefly present the major “PIL innovations” brought along by the 2021 SCCs, focusing solely on choice of law and choice of court clauses. Section B will then point to some unresolved issues that presently find no answer in the Commission’s Q&A (nor elsewhere).

The first and most evident innovation brought along in 2021 consists in an attempt at simplification of the regulatory environment. The three distinct sets of SCCs adopted under Directive 95/46 [Decision 2001/497/EC (SCCs for controller to controller transfers), Decision 2004/915/EC (alternative set of SCCs for controller to controller transfers) and Decision 2010/87/EU (transfer of personal data to processors established in third countries)] have been replaced by two sets of SCCs: one concerning the relationship between controllers and processors to fulfil the requirements in Article 28(3) and (4) of the GDPR; one dealing with SCCs as a tool for the transfer of data outside the EEA. The latter present an innovative modular structure consisting of 4 “modules”, covering four transfer scenarios (cf Q&A Nos 21 and 27): transfer from EU-based Controller to Non EU-based Controller (Module 1); transfer from EU-based Controller to Non EU-based Processor (Module 2); transfer from EU-based Processor to Non EU-based Processor (Module 3); transfer from EU-based Processor to Non EU-based Controller (Module 4).

The parties have to combine “general clauses” (that are applicable regardless of the specific transfer scenario) with the module(s) that applies to their specific situation.

For the purposes of the present blogpost, only the SCCs as a tool for the transfer of data outside the EEA will be considered, as specifically concerns the Clauses dealing with applicable law (A.1) and jurisdiction over remedies (A.2).

The regime governing the choice of the applicable law has undergone significant modifications in the 2021 restyling. To fully grasp these innovations, it is useful to briefly present, at the outset, the previous regime(s) established by the SCCs adopted under Directive 95/46/EC.

Concerning applicable law, the previous sets of SCCs clearly regarded international data transfers as a dynamic process, consisting of three distinct strands.

First, the processing of personal data by the data exporter, including the transfer itself, were governed, up to the moment of the transfer, by the objectively applicable data protection law [clause 4 of the SCCs set out by Decision 2001/497/EC; clause I(a) of the SCCs set out by Decision 2004/915/EC; clause 4 of the SCCs set out by Decision 2010/87/EU]. The “objectively applicable data protection law” is, in this context, the Member State law applicable to the EU-established controller by virtue of EU law itself (ie the law determined pursuant to Article 4 of Directive 95/46/EC until 23 May 2016, and by Article 3 GDPR after this date. This law now includes the GDPR-complementing provisions issued by the Member States based on the opening clauses scattered throughout the GDPR, whose spatial scope of application remains uncertain in current law).

Second, the processing of personal data by the data importer, occurring after the transfer to the third country, was seen as a separate processing operation, placed beyond the scope of the direct application of EU law, and governed by the law chosen by the parties to the SCCs. There was not, however, an unrestricted freedom of choice, which was limited to:

(1) the law of the Member State where the data exporter was established [clause 5 (b) first indent of the SCCs set out by Decision 2001/497/EC; clause II(h)(i) of the SCCs set out by Decision 2004/915/EC];

(2) the provisions of an adequacy decision applicable to the third country where the data importer is established, even if such adequacy decision was not applicable ratione materiae to this importer, provided that such provisions were of a nature which made them applicable in the sector of that transfer [cf. Clause 5 (b) second indent of the SCCs set out by Decision 2001/497/EC; clause II (h)(ii) of the SCCs set out by Decision 2004/915/EC];

(3) a (more or less) extensive set of “mandatory data protection principles”, set out in the annexes of the SCCs [clause 5 (b) indent of the SCCs set out by Decision 2001/497/EC; clause II(h)(iii) of the SCCs set out by Decision 2004/915/EC].

Evidently, it is not possible to qualify the choices made under (2) or (3) as a veritable “choice of governing law”: said provisions or principles would have been applied in conjunction with a national law (objectively) applicable to the data importer under local PIL.

Finally, all three sets of SCCs contained a provision entitled “governing law”, whereby “the Clauses shall be governed by the law of the Member State in which the data exporter is established” (respectively clauses 10, IV and 9). The actual scope of this choice of law clause shall be read in the light of what has been said regarding the first two strands of the data processing operation: vis-à-vis the first step, there is no room for party autonomy and the chosen law cannot directly govern the processing operations carried out by the exporter within the EU, including the transfer. The processing of the transferred data by the importer in the third country must also be excluded from the scope of the chosen “governing law”, otherwise the (different) choice eventually made under (2) or (3) above would have been deprived of practical significance. In essence, the law appointed under the clause entitled “governing law” was therefore limited to the “contractual issues” posed by the SCCs (validity, form, nullity, consequences of the total or partial breach etc).

The 2021 SCCs did not change the approach with respect to the first strand of the data transfer operation, which remains subject to the “objectively applicable law”, ie the GDPR as eventually complemented by the applicable Member State law (see Clause 2).

With respect to the second strand, the new SCCs took away the possibility of choosing between different alternatives as regards the legal regime applicable to the processing operations carried out by the importer in the third state. The obligations of this party vis-à-vis the exporter and the data subjects are now set out in greater detail in the SCCs themselves, without any specific reference to a national governing law. Clause 4 specifies, in any event, that the SCCs shall “be read and interpreted in the light of the provisions of Regulation (EU) 2016/679”.

Finally, there is, just as in the previous sets of SCCs, a clause (Clause 17) titled “Governing law”, which is quite innovative as compared to its predecessors. Consistently with the “modular structure” of the SCCs, this clause presents different wordings depending on the specific transfer operation at stake.

• For transfers from controller to controller (Module 1), the parties are free to choose the law of one of the EU Member States, subject to the sole requirement that such law allows for third-party beneficiary rights. In particular, neither the clause itself nor the Q&A require an objective connection between the chosen Member State and the transfer operation: the laws of the Member States are deemed perfectly fungible in this respect.
• This unrestricted freedom of choice disappears for Modules 2 (transfer from controller to processor) and 3 (transfers between processors): the law of the Member State where the exporter is established applies in principle, unless it does not allow for third parties beneficiary rights. In that case, the parties must choose the law of another Member States that allows for such rights (again, no objective connection is required).
• Module 4 (transfers from processor to controller) deals with the situation of a non EU-established controller that transfers data to a EU-established processor (eg. outsourcing of payroll services to a EU company). This transfer comes under the scope of EU law once the EU-based processor sends the data back to its controller, established outside the EEA. Given that this data was originally placed under a different (and possibly less protective) legal regime, EU law relaxes some of its requirements and the SCCs allow, in this case, for an unrestricted choice of applicable law (cf. Q&A No. 37). It is uncertain as to whether this unrestricted freedom of choice continues to exist if the data transferred by the processor partially originates in the EU: in this case, in fact, the Q&As specify that the relaxation of other requirements no longer applies (cf. Q&A 44). Despite the silence of the Q&As on this specific point, the same solution seems required as concerns the governing law.

A lingering uncertainty concerns the scope of the governing law and, in particular, the question as to whether it extends to directly regulating the processing operations carried out by the data importer in the third country. According to Q&A No. 37, this law “will govern the application of the SCCs”. It is also stressed that Clause 17 shall be read in conjunction with Clause 4, whereby the interpretation and application of the SCCs should conform to, and should not contradict, the GDPR. Nonetheless, throughout the Q&A, the governing law is mentioned with respect to marginal contractual issues such as formal requirements (Q&A No. 6); the formalisation of the parties’ consent within the docking clause (Q&A No 12); the time limits (Q&A No. 37).

With respect to jurisdiction for remedies, the previous sets of SCCs were consistent in that they enabled the data subject who invoked third-party beneficiary rights to sue one or both parties to the contract in the Member State where the data exporter was established, without prejudice to any other substantive or procedural rights he may have had under national or international law.

The new SCCs (Clause 18) are, at once, more detailed and more liberal on this point, insofar as they set out, concerning modules 1, 2 and 3, the general principle whereby “any dispute arising from these Clauses shall be resolved by the courts of an EU Member State”. This provision is particularly important from a systemic point of view, as it makes sure that, irrespective of the law governing the processing activities carried out by the importer, the most important principles of EU data protection law would be enforced in any case as overriding mandatory provisions of the forum.

Clause 18 then requires the parties to expressly designate the court of a Member State: again, the freedom of choice seems unrestricted and no longer dependent on the existence of an objective connection between forum and dispute. Letter (c) of that Clause adds the most important innovation, insofar as it allows the data subject to bring legal proceedings against the data exporter and/or data importer before the courts of the Member State in which he/she has his/her habitual residence. This choice of court agreement extends the procedural rights granted to the data subject by Article 79 GDPR, a provision that opens a ground of jurisdiction solely with respect to actions brought against the EU-established data exporter, jurisdiction for any action brought against the third-country data importer being left, under than provision, to national PIL.

It must be stressed on that Q&A No. 33 contains a somewhat confusing reference to national law, as it states, concerning the forum opened by letter (c), that “such actions can be brought before the competent court of the EEA country (as determined by national law) in which you live …”. Nonetheless, the data subject’s possibility of suing the data importer in the Member State of his/her habitual residence should depend not on the (dubious) existence, in national law, of a forum actoris, but rather on the choice of court agreement resulting from the combined reading of letters (c) and (d) of Clause 18 (the latter stating that “[t]he Parties agree to submit themselves to the jurisdiction of such courts”). A totally different question is knowing whether, and under which conditions, the designated court will enforce this choice of court agreement: in case the Brussels I bis Regulation is not deemed applicable to these contracts (see Section B), the answer to this question will indeed depend on the (non uniform and potentially inconsistent) national laws of the Member States.

A derogatory regime is set in place for Module 4, which allows the parties to designate any court, ie even the court(s) of a third country. In this respect, however, Q&A No. 33 specifies that this shall not affect the procedural rights conferred to the data subject vis-à-vis the data exporter under Article 79 GDPR

Despite the useful clarifications brought along by the Commission Q&As, concerning notably the room for manoeuvre given to the parties to the SCCs regarding choice of law and choice of court agreements, there still exists some major open questions regarding the practical operation of these PIL devices, that are liable to impinge on the effectiveness of SCCs as a tool for the effective protection of European personal data in case of extra-EEA transfers.

It must be remembered that the main purpose of the SCCs is to “provide a comprehensive data protection framework that has been developed to ensure continuity of protection in case of data transfers to data importers that are not subject to the GDPR” (Q&A No. 24). Within this framework, the third-party beneficiary rights granted to the data subject play a pivotal role, as evidenced by the importance attached to them during the choice of the governing law (supra, Section A.1). Third-party beneficiary rights are a key-element of the so-called “private enforcement” of EU data protection law, insofar as they allow the data subject to directly invoke the protection vested by the GDPR and the SCCs both against the importer and the exporter, and to do so before a court in the EU.

Intuitively, the effective ability of the data subject to ground the jurisdiction of such courts and to invoke the application of said law will depend on the procedural treatment of these choice-of-law and choice-of-court agreements in the seised/designated courts. In this respect, the applicability of both the Brussels Ibis and the Rome I Regulations to the SCCs remains controversial, and finds no clarification in the Commission’s Q&As. Conversely, both the SCCs and the Q&As seem to simply assume that these choice-of-law and choice-of-court agreements will be enforced by any court in the EU.

The Brussels I bis and the Rome I Regulations (as well as the Hague Convention on Choice of Court Agreements) apply in “civil and commercial matters”. A recent and exhaustive summary of the (uniform) meaning of this expression in EU PIL can be found in the Opinion of AG Szpunar and the judgment rendered by the ECJ in Rina. Regard should be had, in particular, to the need of ensuring that the Regulations are broad in scope (§ 31 of the judgment in Rina) and to the “the elements which characterise the nature of the legal relationships between the parties to the dispute or the subject matter thereof” (§ 32). This assessment aims at excluding that one of the parties (or both) is acting in the exercise of “public” powers, ie “powers falling outside the scope of the ordinary legal rules applicable to relationships between private individuals” (§ 34).

Against this backdrop, it is worth stressing that the SCCs set up by the Commission can be used by the parties (which, in most cases, will be private commercial operators) without the prior approval by a public authority, the competent DPA. The triangular relationship between the data importer, the data exporter and the data subject heavily relies of private contract law. If it is true that these are all factors that may vouch for the inclusion of SCCs within the scope of “civil and commercial matters”, the fact remains that the Commission’s Q&As stress, on many occasions, the specific “nature” of the SCCs and the ensuing limits placed on the parties’ substantive party autonomy: “if the parties change the text of the SCCs themselves (beyond the adaptations mentioned below) they cannot rely on the legal certainty offered by an EU act” (Q&A No. 7, emphasis added). It will likely be for the ECJ to determine whether the specific nature of “EU act” attached to the SCCs and the limitations it entails for ordinary contract law are enough to exclude a characterisation as “civil and commercial matters” for the purposes of EU PIL.

If the Brussels 1bis Regulation was deemed applicable ratione materiae, it would ensure the effectiveness of the above-mentioned choice-of-court agreements throughout the EU. The fact that said agreements are invoked by a third-party beneficiary should not pose any problem in the light of the Gerling case law. Clearly, the Brussels Ibis Regulation would not be applicable to choice of court agreements concluded under Module 4, in cases where jurisdiction is conferred upon a third-state court.

The applicability of the Rome I Regulation to the SCCs elicits more substantial doubts.

To begin with, it is uncertain as to whether the choice of law made by the parties under current Clause 17 can be deemed “free” in the sense of Article 3 thereof. Setting aside the non-problematic case of the (unrestricted) freedom of choice available for Module 4, Module 2 and 3 confer very limited leeway: the parties must choose the law of the Member State where the data exporter is established, deviations being admissible solely if this law does not allow for third-party beneficiary rights (it must be added that the unrestricted freedom of choice which follows from this circumstance is at odds with the limitation set by the general rule: a “cascade” list of options or, even better, a rule turned around a “close(st?) connection” with another Member State would have been a more logical complement to the general rule).

As concerns the requirement that the choice of law made under Article 3 of the Rome I Regulation shall be “free”, it is worth stressing that both the Opinion of AG Campos Sánchez-Bordona and the judgment of the Court in Gruber Logistics started from the assumption that a “choice” of law which is actually imposed by law would be incompatible with this provision (respectively, §§ 97-101 of the Opinion and § 39 of the judgment). In the same case, the Court clarified that regulation does not prohibit the use of standard clauses which are pre-formulated by one of the parties (or, it must be assumed, by a third party). In such a case, freedom of choice, within the meaning of Article 3, can be exercised by consenting to such a clause and is not called into question solely because that choice is made on the basis of a pre-formulated clause.

The compatibility of Clause 17 of the SCCs with the Rome I Regulation teeters along the fine line which separates an ex lege imposition of an applicable law and the sheer pre-drafting by the Commission. It must be stressed, in this respect, that SCCs are established through an Implementing Decision of the Commission, but they can be used by the parties on a voluntary basis to demonstrate compliance with data protection requirements (Q&A No. 1). Nonetheless, if the parties choose to resort to these standard clauses, they are not free to amend the wording of Clause 17, besides the exercise of the freedom of choice (if any) explicitly allowed under that provision. If this provision is amended, the parties need to submit their contract to the DPA for prior approval, to be able to proceed with the transfer. It is highly doubtful that a DPA would approve a contract containing, for example, a choice of third-country law for the transfer scenarios corresponding to Modules 1, 2 and 3. In fact, in the Schrems II, the ECJ attached great importance to the safeguards following from the application of the law of the Member State where the exporter is established, when assessing if the protection granted by the former SCCs was “essentially equivalent” to that guaranteed within the Union (§ 138).

More fundamentally, it must be determined whether the Rome I Regulation is compatible with the “geographical” restriction of the parties’ freedom of choosing the applicable law. This problem is shared by Modules 1, 2 and 3: the chosen law shall be, in all of these cases, the law of a Member State, whereas a choice of third-country law would be totally admissible under the combined reading of Articles 2 and 3 of the Rome I Regulation. From the standpoint of the general theory of PIL, behind this asymmetry lie irreconcilable philosophical stances as concerns the international interchangeability of (private) laws. The Rome I Regulation starts from the assumption of a perfect interchangeability between all the (private) laws of this world, irrespective of their specific contents, and subject to a sheer ex post control through the gateway of the public policy exception. Conversely, the Commission’s SCCs (and probably the GDPR itself) adopt a more prudential approach based on an ex ante pre-selection of laws (those of the Member States of the EU) which, because of their contents, can be deemed “essentially equivalent” in terms of the protection granted to personal data. Again, this is a thorny issue that the ECJ might likely have to resolve in the near future, considering that, according to the Commission, SCCs are, at present, “the most popular tool” for transferring personal data outside the EEA in accordance with the GDPR (Q&A No. 3).

The Academy of European Law (ERA) will held its Annual Conference on European Family Law on 22-23 September 2022 .

The conference will deal with the new Brussels II Regulation, which is applicable from 1 August 2022, hearing of the child, parentage, surrogacy and double motherhood, as well as recent CJEU case law on international family law.

Speakers include Véronique Chauveau, Dagmar Coester-Waltjen, Gilles Cuniberti, Joanna Guttzeit, Frank Klinkhammer, Carlos de Melo Marinho, James Netto, Marta Requejo Isidro, Caroline Rupp, Nadia Rusinova and Andrea Schulz.

For further information, see here.

On 13 September 2022, the French Société de législation comparée will hold a conference on ascertainment of foreign law under the French Draft Code of Private International Law. The full programme of the conference can be found here.

The speakers will discuss the provisions of the draft code on ex officio application and proof of foreign law, which were presented on this blog here.

The new provisions are an attempt to reform proof of foreign law before French courts by seeking inspiration from foreign models, in particular models which involve academic institutions to report to the court on the content of foreign law and models which allow cross examination of expert witnesses on foreign law.

The conference could have been a great opportunity to confront the new provisions with foreign models which do rely on academic institutions or cross examine witnesses in court, but most unfortunately virtually all speakers are French academics and practitioners (the only exception being the director of the Swiss institute of comparative law).

The conference will take place 60 boulevard de la Tour-Maubourg, 75007 Paris, from 5 until 7:30 pm. Attendance is free, but registration is required at emmanuelle.bouvier@legiscompare.com.

In spite of the vacation period, several judgments have been handed down on 1 August 2022.

One of them concerns the interpretation of PIL instruments, namely Regulation (EC) No 2201/2003 and Regulation (EC) No 4/2009. The request from the Audiencia Provincial de de Barcelona leading to Case C-501/20, MPA (Habitual residence – Third State), on the hearing of which I reported here, as well as here as regards AG Spuznar’s opinion of last February, has been decided as follows:

1. Article 3(1)(a) of Council Regulation (EC) No 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility, repealing Regulation (EC) No 1347/2000, and Article 3(a) and (b) of Council Regulation (EC) No 4/2009 of 18 December 2008 on jurisdiction, applicable law, recognition and enforcement of decisions and cooperation in matters relating to maintenance obligations must be interpreted as meaning that the status of the spouses concerned as members of the contract staff of the European Union, working in the latter’s delegation to a third country and in respect of whom it is claimed that they enjoy diplomatic status in that third State, is not capable of constituting a decisive factor for the purposes of determining habitual residence, within the meaning of those provisions.

2. Article 8(1) of Regulation No 2201/2003 must be interpreted as meaning that, for the purposes of determining a child’s habitual residence, the connecting factor of the mother’s nationality and her residence, prior to the marriage, in the Member State of the court seised of an application relating to parental responsibility is irrelevant, whereas the fact that the minor children were born in that Member State and hold the nationality of that Member State is insufficient.

3. Where no court of a Member State has jurisdiction to rule on an application for the dissolution of matrimonial ties pursuant to Articles 3 to 5 of Regulation No 2201/2003, Article 7 of that regulation, read in conjunction with Article 6 thereof, must be interpreted as meaning that the fact that the respondent in the main proceedings is a national of a Member State other than that of the court seised prevents the application of the clause relating to residual jurisdiction laid down in Article 7 to establish the jurisdiction of that court without, however, preventing the courts of the Member State of which the respondent is a national from having jurisdiction to hear such an application pursuant to the latter Member State’s national rules on jurisdiction.

Where no court of a Member State has jurisdiction to rule on an application relating to parental responsibility pursuant to Articles 8 to 13 of Regulation No 2201/2003, Article 14 of that regulation must be interpreted as meaning that the fact that the respondent in the main proceedings is a national of a Member State other than that of the court seised does not preclude the application of the clause relating to residual jurisdiction laid down in Article 14 of that regulation.

4. Article 7 of Regulation No 4/2009 must be interpreted as meaning that:

–        where the habitual residence of all the parties to the dispute in matters relating to maintenance obligations is not in a Member State, jurisdiction founded, on an exceptional basis, on the forum necessitatis referred to in Article 7 may be established if no court of a Member State has jurisdiction under Articles 3 to 6 of that regulation, if the proceedings cannot reasonably be brought or conducted in the third State with which the dispute is closely connected, or proves to be impossible, and there is a sufficient connection between the dispute and the court seised;

–        in order to find, on an exceptional basis, that proceedings cannot reasonably be brought or conducted in a third State, it is important that, following an analysis of the evidence put forward in each individual case, access to justice in that third State is, in law or in fact, hindered, in particular by the application of procedural conditions that are discriminatory or contrary to the fundamental guarantees of a fair trial, without there being any requirement that the party relying on Article 7 demonstrate that he or she has been unsuccessful in bringing or has attempted to bring the proceedings in question before the courts of the third State concerned; and

–        in order to consider that a dispute must have a sufficient connection with the Member State of the court seised, it is possible to rely on the nationality of one of the parties.

So far, the decision is available in seven official languages of the EU, although some versions are still labeled as provisional.

The latest issue of the RabelsZ (Rabels Zeitschrift für ausländisches und internationales Privatrecht) has been published. As always, it contains a number of insightful articles. Here are the authors, titles and abstracts:

Jürgen Basedow, Ulrich Drobnig *25.11.1928 †2.3.2022

Daniel Gruenbaum, From Statehood to Effectiveness: The Law of Unrecognised States in Private International Law

One of the functions of private international law (PIL) is to determine the law that governs a legal relationship. Yet what occurs when the rules designated by PIL emanate from an entity that has not been recognised as a state by the government of the forum? This article aims firstly to identify and describe the major prevailing approaches to applying the law of unrecognised states in contemporary PIL practice. It then critically appraises the principal reasons justifying the application of foreign law despite it emanating from unrecognised states. The article finally argues that applying the law of unrecognised states reveals the potential for PIL to grapple with non-state rules and with interactions of normative orders of all different sorts, regardless of their state pedigree.

Matthias Fervers, Die Drittwirkungen der Forderungsabtretung im Internationalen Privatrecht (Third-Party Effects of Assignments of Claims in Private International Law)

Although Art. 14 Rome I Regulation addresses the relationship between the assignor and the assignee as well as the relationship between the assignee and the debtor, there is still no provision as to the third-party effects of assignments. The question of what law should govern these third-party effects is, correspondingly, a subject of considerable discussion. While some propose that the law governing the assigned claim should be applicable, others suggest that third-party effects should be governed by the law that applies to the contract between the assignor and the assignee; the current prevailing opinion assumes that third-party effects should be governed by the law of the habitual residence of the assignor. This article demonstrates that a limited possibility for a choice of law for assignor and assignee is the most appropriate solution.

Christoph Wendelstein, Der Handel von Kryptowährungen aus der Perspektive des europäischen Internationalen Privatrechts (The Trading of Cryptocurrencies from the Perspective of European Private International Law)

The rules in the Rome I Regulation are used to ascertain the applicable law in cases of trades in cryptocurrencies. However, these are only partially appropriate for a predictable determination of the applicable law. While in B2B and C2C cases of “stationary” trading of cryptocurrencies via Crypto-ATMs the law at the location of the ATM still provides a predictable legal system, this is not the case for online trading with crypto-brokers or via crypto exchanges. Especially in cases of online trading via crypto exchanges, a further complication results from the fact that such platforms allow their users to trade legally under a pseudonym – in line with the historical notion of cryptocurrencies. This may complicate or even prevent the determination of the applicable law. The resulting “vacuum” is to some extent filled by the technical design of the transaction through the use of smart contracts. However, this does not dispense with the question of applicable law. The article examines these and other questions and points out possible solutions de lege lata.

The table of contents in German is available here.

Professor Maarit Jänterä-Jareborg has retired after having been professor in private international law at Uppsala University in Sweden for 23 years. To pay her tribute, the anthology Festskrift till Maarit Jänterä-Jareborg (“Essays in Honour of Maarit Jänterä-Jareborg”) has been edited by Margareta Brattström, Marie Linton, Mosa Sayed and Anna Singer.

The anthology contains 22 contributions as well as a bibliography of Jänterä-Jareborg’s extensive writings over the last four decades. Of the essays in the anthology, eleven are written in English, six in Swedish, four in Norwegian and one in French.

Most of the essays deal with private international law issues. Michael Bogdan and Giuditta Cordero-Moss have both written contributions on different aspects of recognition of foreign marriages. Christina Gonzáles Beilfluss and Nigel Lowe have written essays dealing with the new Brussels II Regulation (2019/1111). In addition to the four mentioned contributions, the book contains several more essays dealing with private international law issues.

A sample read including the full table of contents and the Swedish preface written by the editors can be accessed and read here.