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Comme il se doit dans chaque chronique d’actualité des mois de janvier-février, il faudra commencer par faire écho au discours annuel du Président de la Cour européenne des droits de l’homme qui, pour la première fois, est une Présidente. Sur le plan strictement jurisprudentiel, la Cour de Strasbourg, au cours des deux premiers mois de 2023, se sera surtout signalée à l’attention en refusant la mention du sexe neutre sur l’acte de naissance ; en élargissant la protection des lanceurs d’alerte et celle des victimes secondaires ; en stigmatisant l’absence de toute reconnaissance juridique des couples homosexuels ou l’avertissement du caractère dangereux pour les enfants d’un livre de contes mettant en scène des personnages LGBTI ; en conciliant le respect effectif de la Convention avec les exigences de la lutte contre le terrorisme. Elle se sera aussi intéressée à des questions qui retiennent plus rarement son attention comme les particules nobiliaires ou les variantes d’une langue nationale …

Sur la boutique Dalloz Code civil 2023, annoté Voir la boutique Dalloz

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Par un arrêt du 16 février 2023, la Cour de justice précise certaines dispositions du règlement (CE) n° 805/2004 du 21 avril 2004 portant création d’un titre exécutoire européen.

Sur la boutique Dalloz Droit et pratique des voies d’exécution 2022/23 Voir la boutique Dalloz

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May today’s milestone (reported here) be also an ode to late professors Alegría Borrás and Julio González Campos for their absolute tireless efforts regarding the Spanish language at the Hague Conference on Private International Law (HCCH) and their infatuation with the Spanish language.

Let us remember that we are standing on the shoulders of giants.

 

Take a last look at this image from the website of the HCCH; it will likely change soon. The HCCH has adopted Spanish as an official language from 1 July 2024. . . Here is the official announcement from The Hague Conference (the link provides also the Spanish version): During the annual meeting of the Council on General Affairs and Policy (CGAP), the Members of the Hague Conference on Private International Law (HCCH) expressed their unanimous support for the introduction of Spanish as an official language. From 1 July 2024, Spanish will join English and French as one of the three official languages of the Organisation. This development represents an important further step contributing to universality and inclusiveness at the HCCH, reflecting the importance of multilingualism and multilateralism as core pillars of its work. The adoption of Spanish as an official language will facilitate the proper and effective implementation and operation of the HCCH’s Conventions and instruments in Spanish-speaking States and will therefore have a decisive positive impact on the lives of the hundreds of millions of native Spanish-speakers around the world. The adoption of Spanish will also simplify the lives of the countless other individuals who interact with Spanish-speaking States – be it through commerce, travel, personal relations, or other. The decision to adopt Spanish as an official language of the HCCH will be reflected in CGAP’s Conclusions and Decisions, to be published in the coming days. . . And here is a first blog entry from Claudia Martínez, appropriately in Spanish. . . Notably, a Spanish version of the HCCH website has existed since the launch in 2009. Then, it was the only language version other than the English and French ones. Today, (more or less) full versions exist also in German and Portuguese;  other language sites provide translations of Hague Conventions.

Alexander DJ Critchley has added an enriching installment to Hart’s renowned Studies in Private International Law Series entitled “The Application of Foreign Law in the British and German Courts”.

The author has extensive experience as solicitor in Scots law with a specialisation in family law. His book is the publication of a doctoral thesis completed with distinction at the university of Tübingen (Germany). The blurb reads as follows:

This book explores the application of foreign law in civil proceedings in the British and German courts. It focuses on how domestic procedural law impacts on the application of choice of law rules in domestic courts. It engages with questions involved in the investigation and determination of foreign law as they affect the law of England and Wales, Scotland, and Germany. Although the relevant jurisdictions are the focus, the comparative analysis extends to explore examples from other jurisdictions, including relevant international and European conventions. Ambitious in scope, it expertly tracks the development of the law and looks at possible future reforms.

Please check out Hart’s banner at the top of this page for special discounts for CoL readers.

 

Royal Antwerp Football Club
Libre circulation des personnes
Football : selon l’avocat général Szpunar, les règles de l’UEFA relatives aux joueurs formés localement sont partiellement incompatibles avec le droit de l’Union

Les Mousquetaires et ITM Entreprises / Commission
Concurrence
La Cour annule, partiellement, les arrêts du Tribunal et, en conséquence, les décisions de la Commission ordonnant des inspections dans les locaux de plusieurs entreprises françaises du secteur de la distribution en raison des soupçons de pratiques anticoncurrentielles

This post was contributed by Fabienne Jault-Seseke, who is Professor at University Paris Saclay (UVSQ), and a member of GEDIP.

I reported here on the French judgment which questioned the Court of Justice of the European Union (ECJ) on res judicata. Two months later, in a Recamier case, the French Court of cassation referred again to the ECJ on res judicata as reported by François Mailhé here.

AG Pikamäe delivered his opinion on 16 February 2023 in the first case C-567/21, BNP Paribas. As a reminder, the case relates to an action for payment of various sums, brought in France against a French company by one of its former employees in connection with his dismissal. Previously, he had initiated proceedings in London, his last place of work, and had obtained a judgment ordering the company to pay him compensation for unfair dismissal. In the first instance, a French labour court declared the claims relating to his dismissal inadmissible, because of the res judicata effect of the English judgment. On appeal, the judgment was overturned: the Court of Appeal considered that the various claims for compensation had not been examined by the English court.

The first question referred to the ECJ concerns the obligation to concentrate claims provided for by both legal system at stake.  The second and third questions are related to the notions of cause and subject-matter of the action. In this case, the question is whether an action for unfair dismissal in the United Kingdom has the same cause of action and the same subject-matter as an action for dismissal without real and serious cause in French law or an action for payment of bonuses or premiums provided for in the employment contract, as these actions are based on the same contractual relationship between the parties.  The answers depend on the respective role of Union law and national laws to determine res judicata. Res judicata is not mentioned in the Brussels I Regulation. So the Advocate General first looks at the relationship between res judicata and recognition. Not surprisingly, he states that res judicata is one of the facets of recognition.

AG Pikamäe focuses on two issues, that of the scope of res judicata and that of the consequences for the court of another Member State hearing a related case.

Res Judicata

In a first step, regarding the scope of res judicata and the impact of an national rule of concentration of claims, AG Pikamäe refers to the Jenard Report and the Hoffman judgment (145/86) to justify appliying the doctrine of “extension of effects”, leaving it to the law of the Member State of origin to determine the effects of the judgment invoked in a second Member State (para 46). Therefore, no independent interpretation of the res judicata is given. The Gothaer judgment that might have led to the opposite conclusion. is here irrelevant. It is specific and only apply to jurisdictional decisions.

Thus the law of the United Kingdom must be “taken into account” (applied would have been more precise) for the purpose of determining the authority and effectiveness of the judgment given by the British court (para 52).

But the obligation to concentrate claims does not affect the authority and effectiveness of the judgment (para 53). For AG Pikamäe the rule of “abuse of process”, which is the source of this obligation is not related to res judicata: it is only a means to sanction abuses (para 55). Here it seems that in a somewhat confusing way AG Pikamäe is not interpreting EU law but English law. He refers also to the scheme of Regulation 44/2001 and considers that taking into account, at the stage of the recognition of a decision, a national rule on the concentration of claims could jeopardise the subsequent implementation of the specific rules on jurisdiction in matters relating to individual contracts of employment and of the provisions governing lis pendens and related actions (para 60).  The reasoning does not really convince even in matters of employment contracts where the rules of jurisdiction ensure the protection of the worker. Indeed, one could consider that the protective effect is exhausted with the first proceeding initiated by the worker against his employer. In other words, the employee only has the option of choosing between the place of work and the employer’s home once.

AG Pikamäe goes very far in questioning procedural autonomy when he states that the application of the provisions of Regulation 44/2001 cannot depend on the content of the procedural rules of a Member State (para 62). It does not matter, he adds, that the two Member States concerned have the same rule (para 63). He concludes that a domestic procedural rule on concentration of claims is not an effective criterion for determining the authority attached to a decision given in a Member State. In short, the concentration of claims rule has no consequences for the recognition of decisions. This statement may be surprising. It is up to the law of the country from which the decision originates to specify the extent of res judicata, but the rule on the concentration of claims that it contains is not applied. Thus, while new claims could not have been made in the State of origin, they can be made in another State. Such an attitude is likely to fuel forum shopping and sharpen procedural strategies. In any case the aim of procedural economy is clearly not a priority.

Cause and Subject Matter of Action

In a second step, the opinion focuses on the concepts of cause and subject-matter. The French Cour de cassation had asked the Court of Justice whether a claim for unfair dismissal in the UK has the same cause of action and the same subject-matter as a claim for dismissal without real and serious cause under French law. It also wondered whether a claim for unfair dismissal in the UK has the same cause of action and the same subject-matter as claim for payment of bonuses or premiums provided for in the employment contract, since these actions are based on the same contractual relationship.

The answer to these questions presupposes a precise comparison of the provisions of English labour law with those of French labour law, which is beyond the role of the Court (para 71) but
AG Pikamäe suggests that the Court reformulates the questions referred to it in this way : for the purposes of Articles 33 and 36 of Regulation No 44/2001, do actions based on the same employment contract and relating to obligations arising out of the performance of that contract and to obligations arising out of its termination have the same cause of action and the same subject-matter?

As expected, a parallel between the conditions of lis pendens and those of res judicata is made. AG Pikamäe notes that “the rules on lis pendens and recognition have the common purpose of contributing to the full authority of the judgment given in the Member State of origin, which must not be called into question by a judgment given by a court in another Member State” (para 80). Consequently, he suggests transposing the criterion of identity of parties, cause and subject-matter applicable to lis pendens to res judicata (para 90). As for lis pendens, the terms cause and subject-matter must be regarded as independent.

Building on Gubisch Maschinenfabrik (144/86), Tatry (C‑406/92), and Merck (C‑231/16), AG Pikamäe considers that the claims brought before the Employment Tribunal and those brought before the French Courts, based on the same contractual relationship, are based on the same cause of action.

As regards the ‘subject matter’, the case is more complicated. The Court has stated on different occasions that this means the end the action has in view, that the concept is to be interpreted broadly and cannot be restricted so as to mean two claims which are formally identical and that account must be taken in that regard of the applicants’ respective claims in each of the sets of proceedings. AG Pikamäe distinguishes then between claims relating to the termination of the employment contract and its financial consequences and those relating to the performance of the employment contract (claims for payment of sums due for the performance of work). They have not the same subject-matter (para 106). Nevertheless, the “second” court hearing claims for payment of remuneration in respect of the performance of an employment contract should take into account the possible implications of the original decision. An example is given, the case of the determination, in accordance with the law of the State of origin, by the initial decision of the date of termination of the employment contract, which would be likely to have an impact on the end of the period during which remuneration is due.

AG Pikamäe focuses on the distinction between issues relating to the end of the contract and those relating to the performance of the contract. He considers then that a claim for unfair dismissal in the UK has not the same subject-matter that a claim for payment of sums due for the performance of work. In doing so, it leaves part of the question unanswered. Has a claim for unfair dismissal in the UK the same subject-matter as a claim for dismissal without real and serious cause under French law? A positive answer is only suggested. It is to be hoped that the ECJ will be clearer. The worker is sometimes encouraged to pick and choose among the different laws that may be applied to the employment relationship. The effect would be multiplied if he were also allowed to multiply the proceedings in different countries.

L’arrêt de la Cour de justice du 16 février 2023 porte sur le régime applicable aux décisions de retour prononcées en matière d’enlèvement international d’enfants et concerne plus particulièrement des dispositions du droit polonais concernant la suspension de l’exécution de ces décisions.

Sur la boutique Dalloz Droit de la famille 2023/24 Voir la boutique Dalloz

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The first view of the second issue of ICLQ  for 2023 contains a private international law article that was published online just recently:

 

S Matos, Arbitration Agreements and the Winding-Up Process: Reconciling Competing Values

Courts in a number of jurisdictions have attempted to resolve the relationship between winding-up proceedings and arbitration clauses, but a unified approach is yet to appear. A fundamental disagreement exists between courts which believe that the approach of insolvency law should be applied, and those which prefer to prioritise arbitration law. This article argues that a more principled solution emerges if the problem is understood as one of competing values in which the process of characterisation can offer guidance. This would allow both a more principled approach in individual cases, and a more coherent dialogue between courts which take different approaches to the issue.

Prigozhina / Conseil
Relations extérieures
Le Tribunal annule les mesures restrictives appliquées à Mme Violetta Prigozhina, mère de M. Yevgeniy Prigozhin, dans le cadre de la guerre menée par la Russie contre l’Ukraine

The first issue of the Journal du droit international for 2023 was released. It contains one article and several case notes relating to private international law issues.

In her article, Valérie Pironon (University of Nantes) discusses the issue of international competence in private litigation in the field of anti-competitive practices (L’adaptation des règles de compétence juridictionnelle issues du règlement Bruxelles I bis aux actions en réparation des préjudices causés par une pratique anticoncurrentielle).

The English abstract reads:

Private litigation in the field of anti-competitive practices often has a cross-border dimension justifying the application of private international law mechanisms. Where the dispute is integrated into the European Union, the rules of jurisdiction are those of Brussels I bis Regulation. The implementation of this general regulation in such a specific field of law is often problematic. It seems that the interpretation given by the Court of justice when asked is aimed at encouraging the development of these actions. However, this motivation does not result clearly from the judgments. After considering the hypothesis of a hidden adaptation of the rules of jurisdiction to the material competition stakes at issue, the article questions the prospect of a more transparent adaptation. 

The table of contents of the issue can be accessed here.

This week the Hague Conference on Private International Law (HCCH) published the Practical Guide – Access to Justice for International Tourists and Visitors. The HCCH news item is available here.

As indicated in the Guide, this document “is intended to assist international tourists and visitors to foreign countries seeking access to justice for disputes arising from their tourism experience by providing information on online dispute resolution mechanisms that may be available and HCCH legal instruments that may be relevant in a given case.”

There are a few aspects of the Guide that are worthy of note:

First, the definitions of a visitor and a tourist are interesting.

A “visitor” is considered to mean “a traveller taking a trip to a main destination outside their usual environment, for less than a year, for any main purpose (business, leisure, or other personal purpose) other than to be employed by a resident entity in the country or place visited.”

A “tourist”: “A visitor (domestic, inbound, or outbound) is classified as a “tourist” if their trip includes an overnight stay.”

These definitions are taken from the United Nations World Tourism Organization (UNWTO).

Secondly, Part I of this Guide provides a list of online dispute resolution platforms, although some are not specific to international tourists and visitors. Among the governmental initiatives are: EU Online Dispute Resolution Platform (European Commission), Concilianet de PROFECO (Mexico) and Consumidor.gov.br (Brazil). Among the private initiatives are: Airbnb Online Resolution Centre and Endispute.

Thirdly, Part II of this Guide sets out examples of common claims made by tourists and visitors such as lost baggage, cruise cancelled due to weather, and damage to property at hotel. These examples are merely indicative and of course do not constitute legal advice.

All in all it makes an interesting read and its layout is more easily readable on different devices. Nevertheless, it does make me wonder how much this document would actually help tourists and visitors in times of trouble.

 

 

On 8 March 2023, the latest edition of the cycle of seminars – entirely in English – on cross-border civil and commercial litigation will begin, as part of the European project Jean Monnet Module on Multilevel, Multiparty and Multisector Cross-Border Litigation in Europe, organized by the Department of Italian and Supranational Public Law of the University of Milan.

This year’s edition will focus on the following three topics:

– Binding effects and res iudicata in a multilevel dimension (seminars on 8-9-15-16-17-22-23 March 2023);

– Collective redress and group litigation (seminars on 29 March-12-13-19-20-26-27-28 April 2023);

– Main procedural issues of climate litigation (seminars on 3-4-10-11-17-18 May 2023).

The seminars (currently being accredited by the Milan Bar Council) can be followed both face-to-face and remotely, on the MS Teams platform.

All information on the program and how to register may be found here.

Marco Biasi (Università degli Studi di Milano) has published Decent Work and the Virtual Dimension: Reflections about the Regulation of Work in the Metaverse in Lavoro Diritti Europa 2023/1. The article (written in Italian) deals with conflict-of-laws and substantive law issues of working in the virtual world.
What is the Metaverse?

The metaverse is more than the eponymous project of Facebook, which has recently rebranded itself as “Meta”. The term was first mentioned in 1992 in the novel “Snow Crash” by Neal Stephenson, and describes a virtual space in which participants are fully immersed and can interact with each other almost as in real life. In essence, the metaverse is thus a special type of computer programme which allows people to interact in digital space. To do so, they need equipment, in particular a virtual reality headset and controllers, which are readily available today at a relatively affordable price. Nowadays, a multitude of projects exist aiming to create such a metaverse. Well-known projects in this field are Decentraland and The Sandbox, and of course the ”Metaverse” developed by Meta.

What Kind of Disputes Could Arise?

In the metaverse, various forms of activity can be performed, such as office work, reunions, sales meetings, education – under an employment agreement. As such, disputes between employers and employees will soon emerge, and with them, the question which law applies to work performed. The problem of connecting a metaverse to the labour law of a particular nation state is as obvious as it is baffling.

Where is Work in the Metaverse Habitually Carried Out?

In the European Union, according to Article 8 Rome I Regulation, the country from which or in which the work is habitually performed is of particular importance for determining the law applicable to a contract of employment, irrespective of whether there is a choice of law. Although Article 8(1) Rome I Regulation follows the principle of party autonomy by allowing the parties to choose the applicable law, this choice is limited by the mandatory rules of the country in or from which the work is habitually carried out.
At first sight, both connecting factors seem to lead nowhere given that the work is performed in the virtual space. But Marco Biasi rightly distinguishes the situation of metaverse workers from that of posted workers and pulls us down to a more realistic view point: an employee who sits in their home in country X with a headset and a controller in fact performs their work in this country, and nowhere else.

Labour Law as Overriding Mandatory Rules

This seems to settle the question, yet it would provide very strong incentives for metaverse employers to pick and choose employees living in countries with the lowest labour law standards possible. One way of avoiding this problem could be to assume a closer connection between the contract and the country of establishment of the employer under Art 8(4) Rome I. Marco Biasi suggests, however, another solution: if the employees themselves were to bring a claim in the country of domicile or seat of the employer, the courts there could apply the provisions of their national labour law as overriding mandatory rules (Art 9 Rome I Regulation).

The (possibly) too lenient rules of the place of habitual residence of the worker could thus be overcome and fairness between employer and employee could be re-established. In this way, a nucleus of essential workers protections could be preserved, e.g. the maximum working hours, the minimum wage, and health and safety rules.

There are, however, two problems with this suggestion: First, the employee would have to make the effort of bringing a suit in the country of the employer, which will often be fraught with difficulties such as distance, language, and costs. Second, the suggestion presupposes that mandatory labour law rules could be applied via Article 9 Rome I, even though Article 8 Rome I seems to conclusively determine their application. While many authors indeed are of this view, it is in no way the subject of consensus.

Going Further

Marco Biasi assumes that, in any event, the protection of the employee will be incomplete and differ from country to country. Therefore, he suggests introducing international rules (such as a convention) on the rights of metaverse employees. Some problems will be hard to solve, though; trade negotiations on behalf of a class of workers scattered around the planet will be particularly challenging. There remain, therefore, enough problems to think about even after this first in-depth study of labour law in the metaverse.

Conventions & Instruments

On 1 February 2023, the 1980 Child Abduction Convention entered into force for Botswana. The Convention currently has 103 Contracting Parties. More information is available here.

On 17 February 2023, Azerbaijan deposited its instrument of accession to the 1965 Service and 2007 Child Support Conventions. The 1965 Service Convention, which now has 80 Contracting Parties, will enter into force for Azerbaijan on 1 September 2023, subject to the Article 28 procedure. As for the 2007 Child Support Convention, with the accession of Azerbaijan 46 States and the European Union are now bound by it. It will enter into force for Azerbaijan on 28 February 2024. More information is available here.

Meetings & Events

On 7 and 8 February 2023, the Permanent Bureau of the HCCH co-organised the Regional Conference “The HCCH and the relevance of its work for Southern Africa”, together with Finland and South Africa, with the participation of Namibia and Tanzania, as well as other Southern African Development Community States, and hosted by the University of Pretoria (South Africa). More information is available here.

From 13 to 15 February 2023, the International Transfer of Maintenance Funds Experts’ Group met for the fourth time. Pursuant to its mandate, the Experts’ Group continued its work discussing good practices in relation to the cross-border transfer of maintenance payments, with a view to identifying solutions that are cost-effective, transparent, prompt, efficient and accessible. More information is available here.

From 13 to 17 February 2023, the Working Group on Matters Related to Jurisdiction in Transnational Civil or Commercial Litigation met for the fourth time. Pursuant to its mandate, the Working Group made further progress on the development of draft provisions for a possible future instrument on parallel litigation in civil or commercial matters. More information is available here.

Upcoming Events

Registrations are open for the conference “The HCCH 2019 Judgments Convention: Cornerstones – Prospects – Outlook”, which will be held in person on 9-10 June 2023 at the University of Bonn in Germany. More information is available here.

Vacancies

Applications are now open for three- to six-month legal internships for the period from July to December 2023. The deadline for the submission of applications is 31 March 2023 (18:00 CEST). More information is available here.

 

These monthly updates are published by the Permanent Bureau of the Hague Conference on Private International Law (HCCH), providing an overview of the latest developments. More information and materials are available on the HCCH website.

 

Thank you Gilles Cuniberti for flagging and discussing the French Supreme Court’s judgment in JE and B v Barclay Pharmaceuticals [cross-referral to the English judgment makes this Barclay Pharmaceuticals v Mekni]. Much of this post is already included in prof Cuniberti’s posts.

The core of the case concerns the enforcement of an English judgment [Barclay Pharmaceuticals Ltd v Antoine Mekni and others, [2018] 6 WLUK 461] which, in assisting Barclay Pharmaceuticals with enforcement of an earlier established £8.7 million debt (since accrued with costs etc to about £12 million), had declaratorily held that a large number of bank accounts and other entities which for the most part purport to belong to parties other than Mr Mekni, are in truth owned by him. Mr Mekni did not appear in the English declaratory relief proceedings hence did not there object to jurisdiction.

The relevant issue in the French proceedings for the purposes of the blog, is first of all Article 24(3) Brussels Ia’s exclusive jurisdiction for ‘proceedings which have as their object the validity of entries in public registers’. As Gilles had earlier discussed, here the Supreme Court [5-6] held that an English judgment determining ownership in shares held in public registers, does not engage ‘the validity of entries in public registers’, for said exclusive jurisdiction, it holds, only extends to the formal validity of such entry, not to the ownership of the assets related to the entry.

As Gilles notes, it was possible for the SC succinctly to deal with the A24(3) argument for under the applicable French law relating to the type of corporation involved, whose shares were the object of the proceedings, the only impact of the (non-obligatory) registration was to create limited third party effect; registration has no bearing on the existence, validity and ownership of the shares. Professor Cuniberti justifiably signals that a distinction between substantive and formal validity may not always be easily made.

The second issue of note to the blog, is the issue of service. A43(1) BIa prescribes that

Where enforcement is sought of a judgment given in another Member State, the certificate issued pursuant to Article 53 shall be served on the person against whom the enforcement is sought prior to the first enforcement measure. The certificate shall be accompanied by the judgment, if not already served on that person.

Recital 32 adds

In order to inform the person against whom enforcement is sought of the enforcement of a judgment given in another Member State, the certificate established under this Regulation, if necessary accompanied by the judgment, should be served on that person in reasonable time before the first enforcement measure. In this context, the first enforcement measure should mean the first enforcement measure after such service

In the case at issue, service happened at 2:55 PM and enforcement at 3 PM. Does that leave a ‘reasonable time’? I share Gilles’ frustration that the SC [3] merely replied that French CPR does not require the SC to engage with grounds of appeal that are manifestly unarguable

En application de l’article 1014, alinéa 2, du code de procédure civile, il n’y a pas lieu de statuer par une décision spécialement motivée sur ces griefs qui ne sont manifestement pas de nature à entraîner la cassation.

The take-away from this is that the SC in the circumstances did not see a clear infringement of A43 juncto A53 BIa. That does of course leave a lot of speculation as to when the timing of service might lead to enforcement issues – crucial too, I would suggest, in case of provisional measures.

Geert.

 

On 9 March 2023, the Court will deliver the judgment in C-177/22, Wurth Automotive. The Landesgericht Salzburg (Austria) referred the following (extremely case-specific) questions on the interpretation of the Brussels I bis Regulation and the consumers’ heads of jurisdiction:

1. Does the assessment of whether the applicant is a consumer within the meaning of Articles 17 and 18 of Regulation (EU) No 1215/2012 depend on

a) whether the applicant pursued the activity of a graphic and web designer declared by her in the proceedings only as an employed person or, at least in part, also in the context of a freelance activity at the time of concluding the contract of sale and immediately thereafter and

b) the purpose for which the applicant acquired the vehicle, that is to say solely for the purpose of satisfying her own needs in terms of private consumption or also in connection with a current or future trade or professional activity or purpose?

2. Would the applicant no longer be able to rely on her status as a consumer if she had resold the passenger car in August 2019, and would any profit made in the process be relevant?

3. Must the applicant be considered not to be a consumer merely because she signed a standard contract of sale prepared by the defendant, the printed form of which designated the buyer as a ‘company’ and contained the text ‘business-to-business/no return, no warranty/delivery only after receipt of money’ under the heading ‘special agreements’ in a smaller font, without objecting to this and referring to the fact that she was a consumer?

4. Must the applicant accept responsibility for the conduct of her partner, who acted as a car dealer in arranging the purchase, from which the defendant could have concluded that the applicant was a trader?

5. Is it to the detriment of the applicant in the assessment of whether she is a consumer if the court of first instance was unable to determine why the written contract of sale differed from the preceding offer by the applicant’s partner in terms of the designation of the buyer or what was discussed in that regard during the telephone calls between the applicant’s partner and one of the defendant’s salespeople?

6. Is it relevant to the applicant’s status as a consumer if the applicant’s partner telephoned the defendant several weeks after taking delivery of the vehicle to enquire whether it was possible to state the VAT on the invoice?

The case has been allocated to a chamber of three judges (L.S. Rossi, J.C. Bonichot, O. Spineanu-Matei as reporting judge). No opinion was requested.

All remaining PIL-related events will take place on Thursday 23 March. A hearing is scheduled on case C-90/22, Gjensidige, also regarding the Brussels I bis Regulation, this time in relation to the CMR (Convention on the contract for the international carriage of goods by road, Geneva, 19 May 1956). The main proceedings concern a claim for compensation of loss on the basis of subrogation. In cassation, the Lietuvos Aukščiausiasis Teismas (Lithuania) is asking the Court of Justice:

1. Can Article 71 of Regulation No 1215/2012, having regard to Articles 25, 29 and 31 and recitals 21 and 22 thereof, be interpreted as permitting the application of Article 31 of the CMR Convention also in cases where a dispute falling within the scope of both those legal instruments is the subject of an agreement conferring jurisdiction?
2. Having regard to the legislature’s intention to strengthen the protection of agreements conferring jurisdiction in the European Union, can Article 45(1)(e)(ii) of Regulation No 1215/2012 be interpreted more broadly, as covering not only Section 6 of Chapter II of that regulation but also Section 7 thereof?
3. After assessment of the specific features of the situation and the resulting legal consequences, can the term ‘public policy’ used in Regulation No 1215/2012 be interpreted as covering the ground for deciding not to recognise a judgment of another Member State where the application of a specialised convention, such as the CMR Convention, creates a legal situation in which both the agreement conferring jurisdiction and the agreement on the applicable law are not observed in the same case?

The deciding chamber is composed of judges A. Arabadjiev, P.G. Xuereb, T. von Danwitz, A. Kumin (as reporting judge), and I. Ziemele. On the occasion of the hearing, AG N. Emiliou will indicate the date he will publish his opinion.

The same day the Court will publish the opinions on cases C-590/21, Charles Taylor Adjusting, and C-832/21, Beverage City Polska, both by AG J. Richard de la Tour; C-21/22 OP, by AG M. Campos Sánchez-Bordona; and C-87/22, TT (Déplacement illicite de l’enfant), by AG P. Pikamäe.

In C-590/21, Charles Taylor Adjusting (on which I already reported here) the Court has been asked whether injunctions of a court capable of hindering  the continuation of proceedings pending before the jurisdiction of another State, in particular by awarding compensation to cover the costs of the defendants before that jurisdiction, are contrary to the public policy of the European Union in the sense of Article 34(1) of Regulation  44/2001. The referring court – the Greek Areios Pagos- is asking :

(I)      Is the expression ‘manifestly contrary to public policy’ in the EU and, by extension, to domestic public policy, which constitutes a ground for non-recognition and non-enforcement pursuant to point 1 of Article 34 and Article 45(1) of Regulation No 44/2001, to be understood as meaning that it extends beyond explicit anti-suit injunctions prohibiting the commencement and continuation of proceedings before a court of another Member State to judgments or orders delivered by courts of Member States where: (i) they impede or prevent the claimant in obtaining judicial protection by the court of another Member State or from continuing proceedings already commenced before it; and (ii) is that form of interference in the jurisdiction of a court of another Member State to adjudicate a dispute of which it has already been seised, and which it has admitted, compatible with public policy in the EU? In particular, is it contrary to public policy in the EU within the meaning of point 1 of Article 34 and Article 45(1) of Regulation No 44/2001, to recognise and/or declare enforceable a judgment or order of a court of a Member State awarding provisional damages to claimants seeking recognition and a declaration of enforceability in respect of the costs and expenses incurred by them in bringing an action or continuing proceedings before the court of another Member State, where the reasons given are that: (a) it follows from an examination of that action that the case is covered by a settlement duly established and ratified by the court of the Member State delivering the judgment (or order); and (b) the court of the other Member State seised in a fresh action by the party against which the judgment or order was delivered lacks jurisdiction by virtue of a clause conferring exclusive jurisdiction?

(II)    If the first question is answered in the negative, is point 1 of Article 34 of Regulation No 44/2001, as interpreted by the Court of Justice of the European Union, to be understood as constituting a ground for non-recognition and non-enforcement in Greece of the judgment and orders delivered by a court of another Member State (the United Kingdom), as described under (I) above, where they are directly and manifestly contrary to national public policy in accordance with fundamental social and legal perceptions which prevail in Greece and the fundamental provisions of Greek law that lie at the very heart of the right to judicial protection (Articles 8 and 20 of the Greek Constitution, Article 33 of the Greek Civil Code and the principle of protection of that right that underpins the entire system of Greek procedural law, as laid down in Articles 176, 173(1) to (3), 185, 205 and 191 of the Greek Code of Civil Procedure cited in paragraph 6 of the statement of reasons) and Article 6(1) of the [European Convention on Human Rights], such that, in that case, it is permissible to disapply the principle of EU law on the free movement of judgments, and is the non-recognition resulting  therefrom compatible with the views that assimilate and promote the European perspective?

The case has been assigned to a chamber of five judges (K. Jürimäe, M. Safjan, N. Piçarra, M. Gavalec, N. Jääskinen reporting).

C-832/21, Beverage City Polska (hearing last January was announced here) concerns the interpretation of Article 8(1) of the Brussels I bis Regulation, in particular the condition of a close relationship (‘so closely connected’) required for the purposes of applying the head of international judicial jurisdiction in a situation which, potentially, could amount to “forum shopping”. The request has been referred by the Oberlandesgericht Düsseldorf (Germany), in proceedings brought by the proprietor of a number of EU trade marks including: an application for injunction throughout the territory of the Union, and an application (limited to acts in Germany) for information, the disclosure of accounts and a declaration of liability for damages. They are both directed against a German company and a Polish company as well as against two natural persons, in a personal capacity and as managers of these companies. The question referred reads:

Are claims ‘so closely connected’ that it is expedient to hear and determine them together to prevent irreconcilable judgments, within the meaning of Article 8(1) of the Brussels Ia Regulation, where, in infringement proceedings for infringement of an EU trade mark, the connection consists in the fact that the defendant domiciled in a Member State (here, Poland) supplied the goods which infringe an EU trade mark to a defendant domiciled in another Member State (here, Germany) whose legal representative, against whom infringement proceedings have also been brought, is the anchor defendant, if the parties are connected to each other only through the mere supply relationship beyond which there is no legal or factual connection?

Judges E. Regan, D. Gratsias, I. Jarukaitis, Z. Csehi and M. Ilešič (reporting) will decide on the requested interpretation.

C-21/22, OP (Choix du droit d’un État tiers pour la succession), is a request from the Sąd Okręgowy w Opolu (Poland), on appeal lodged against the refusal by a notary practising in Poland to draw up a notarial will on behalf on an Ukrainian national; the will would contain a clause stipulating that the law applicable to all matters relating to the succession and modification of the legal order of succession would be Ukrainian law. The questions referred require the interpretation of the Succession Regulation and the ascertainment of its relationship to bilateral conventions between Member States and third States:

1. Must Article 22 [of Regulation No 650/2012] be interpreted as meaning that a person who is not a citizen of the European Union is entitled to choose the law of his or her native country as the law governing all matters relating to succession?
2. Must Article 75, in conjunction with Article 22, of Regulation No 650/2012 be interpreted as meaning that, in the case where a bilateral agreement between a Member State and a third country does not govern the choice of law applicable to a case involving succession but indicates the law applicable to that case involving succession, a national of that third country residing in a Member State bound by that bilateral agreement may make a choice of law?

Judges K. Jürimäe, M. Safjan, N.J. Piçarra,  M. Gavalec and N. Jääskinen (reporting) will decide on the matter.

Finally, in C-87/22, TT (Déplacement illicite de l’enfant), the Landesgericht Korneuburg (Austria) is asking about the scope of Article 15 of Regulation 2201/2003 (Brussels II bis), the conditions of application of that article and its relationship with Article 10 of that regulation.

1. Must Article 15 of [the Brussels II bis Regulation], be interpreted as meaning that the courts of a Member State having jurisdiction as to the substance of the matter, if they consider that a court of another Member State, with which the child has a particular connection, would be better placed to hear the case, or a specific part thereof, may request such a court to assume jurisdiction even in the case where that other Member State has become the place of habitual residence of the child following wrongful removal?
2. If Question 1 is answered in the affirmative: Must Article 15 of [the Brussels II bis Regulation], be interpreted as meaning that the criteria for the transfer of jurisdiction that are set out in that article are regulated exhaustively, without the need to consider further criteria in the light of proceedings initiated under Article 8(f) of the Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction?

The request has been attributed to judges C. Lycourgos, K. Lenaerts, J.C. Bonichot, O. Spineanu-Matei, and L.S. Rossi (reporting).

Reviewing Sanctions in Arbitration: The Good, the Bad, and the Ugly of Private International Law Analysis

by Naimeh Masumy, [nmasumy@gmail.com]

The growing role of arbitration as a peaceful means for resolving investment, commercial and inter-state disputes is now impacted by an increasing number of sanction regimes borne out of the recent geopolitical conflicts.  Following Russia’s invasion of Ukraine, many regulators across various jurisdictions sought to move towards greater coordination of sanction implementation and enforcement efforts. The recent tranche of sanctions has sparked a debate on the appropriate standards of review that arbitral tribunals ought to apply when dealing with disputes involving sanctions.

In this short note, we look at the case of Sofregaz v. NGSC, which provides a sobering exposition of the challenges faced by the adjudicative bodies when assessing the legality of unilateral Extra-territorial sanctions under international law.  This case concerns the annulment of an arbitral award rendered in Paris 2018 in favor of NGSC, pursuant to the Rules of Arbitration of the International Court of Arbitration of the International Chamber of Commerce (ICC Rules). In 2018, the ICC tribunal found against Sofregaz and awarded NGCS an amount of over USD 2.4 million for an unpaid invoice and down payment drawn by Sofregaz under certain guarantees. Sofregaz applied to set aside the award before the Paris Court of Appeal.  It sought an annulment application based on NGSC’s exposure to US secondary sanction. Sofregaz argued, inter alia, that the tribunal had failed to carry out its mandate and had not considered the impact of sanctions against Iran on the performance of the contract. In Sofregaz’s view, this resulted in an award contrary to French international public policy in that it gave effect to a contract that could not be performed without breaching the designated sanctions. The Court of Appeal dismissed the annulment application brought by the Sofregaz, using private international law analysis to dismiss the legality of U.S. sanctions.

This note will highlight why invoking such a private international law analysis when determining the validity and the scope of applicable sanctions will undermine international arbitration. Then, it will show that such an analysis is inconsistent with the overriding objectives of international arbitration – arguably, the creation of an autonomous dispute resolution system for the effective and expeditious resolution of disputes in a delocalized fashion.

The Relevance of Private International Law Analysis to Arbitration

Private international law provides a judicial tool for courts to address the distinction between forum law and foreign law and promotes a smooth functioning of the international legal regime by mitigating jurisdictional conflicts, especially in a legal relationship involving several applicable laws.  Courts weigh private and public policy concerns of the forum law and foreign law when determining whether to apply the laws of a foreign jurisdiction over the forum law.

Many scholars have strongly advocated the use of private international law analysis in international arbitration. The benefits of such analysis are particularly clear when arbitrators are faced with potentially conflicting laws, similar to the case of Sofregaz v. NGCS. where the tribunal was confronted with three different sets of laws: Iranian law governing the contract, French law as the law applicable at the seat of arbitration, and the U.S. law governing the sanctions regime, albeit extraterritorially imposed, which materially impacted on the performance of a contract. The tribunal did not consider the impact of US sanctions, and rendered an award in favor of NGSC due to the wrongful termination of a contract for the conversion of a gas field.

 In such instances, private international law can operate as a mechanism of localization that permits tribunals to adjudicate in cases involving several legal orders by taking into account important considerations such as overriding mandatory rules at the seat of the arbitral tribunal.

Arbitrators are generally empowered to apply the law deemed “appropriate” or “applicable” in the absence of a governing law clause. Notably, Article 22(3) of the 2020 LCIA Rules also authorizes arbitrators, when determining the lex contractus, to apply the rules of law they deem appropriate. Such approaches can provide objective yardsticks for tribunals exercising their discretion to select the appropriate law. Having objective criteria aids predictability and efficiency and ensures tribunals do not act outside their designated mandates.

This is of particular significance as the uncertainty over the governing law may negatively affect the parties’ due process rights and may lead to the award being issued arbitrarily. Such concern was echoed in the Sofregaz application to set aside the award in 2019, in which it was claimed that the tribunal failed to take into account the impact of U.S. economic sanctions. Thus, that award recognition would be contrary to international public policy (“l’ordre public international”).

The court dismissed the claim observing that the Tribunal did not violate international public policy in failing to consider the impact of U.S. economic sanctions. To this end, the French court defined international public policy as “the body of rules and value whose violation the French legal order cannot tolerate, even in the international context.” In its reasoning, the court heavily endorsed French conflict-of-laws rules to determine the contour of mandatory rules. This approach means that if a tribunal relies on objective criteria to take into account essential regulations of the forum such as domestic and international mandatory law, the final award may remain immune from potential challenges.  In other words, private international law analysis may be a desirable straight jacket to ensure that tribunals comply with regulatory provisions of the forum. As such, it may enable courts to establish trust in arbitration and refrain from inquiring into the merits of final awards.

Conflict of Rules Analysis: Undermining the Delocalization Theory

The delocalization theory of arbitration is a part of the much broader, which posits that international arbitration ought to be completely detached from the procedural and substantive law of the place of arbitration or the seat, or lex loci arbitri, and from national law in general. According to this theory, arbitration is a private activity, which can be considered favorably or unfavorably, but certainly does not need to be empowered by any state ex ante. While this theory found a firm grounding under the French law of international arbitration, in reality, this theory usually carries little weight, especially in enforcing an award that has been challenged. The theory of delocalization begins to wane, as the legal system of the forum country will be the primary source relevant to ascertaining the legal relationship of the final award and the mandatory provisions of the lex fori.

In addition, the New York Convention muddies the waters by making reference to domestic public policy in article V (2) (b) as a ground for non-recognition or enforcement of an award., Based on the literal reading of the Convention, the law of the seat of arbitration usually delineates. Thus, to contextualize international arbitration through the prism of absolute delocalization, a system wholly emancipated from the forum law will pose practical challenges.

The above is of relevance to the role of sanctions for arbitral awards. Private international law is predicated on the notion that the world is divided into nation states and national legal orders. This approach dramatically contrasts with what international arbitration delocalisation theory arguably has long sought: to free arbitration from national orders. According to this view, examining the validity and scope of sanctions through the prism of private international law analysis forces the arbitrator to draw upon domestic law. This, in turn, contravenes the main tenet of delocalization theory, which confirms that arbitration has no forum. Further, the arc of modern arbitration laws arguably negates the relevance of private international law analysis. Modern arbitration laws are mostly substantive laws, and the notions embedded in arbitration are substantially transnational rather than international, which undermines the viability of the private international law analysis.

Private International Law Analysis: A False Aura of Objectivity

Despite the widespread view that private international law provides a roadmap towards a more predictable and objective outcome for disputes involving sanctions, such framework is prone to inconsistent and divergent results. Private international law provides a basis of jurisdiction to apply foreign law when several laws may concurrently apply to the dispute. In doing so, private international law approaches balance competing interests according to notions such as reciprocity, expectation of courtesy and comity. The exact contours of these notions have remained imprecise, as the U.S. Supreme Court noted in the case of Hilton v. Guyot. Courts often draw upon their ideology and values explicitly and implicitly to ascertain comity. Such assessment will inadvertently lead to adjudicators interposing ad hoc political judgments about foreign relations, opening a door for arbitrators to endorse parochial domestic policies to ascertain the legal orders involving international components. This is evident in the French Court’s reasoning, in which the court heldthat “[t]he unilateral sanctions taken by U.S. authorities against Iran cannot be regarded as the expression of an international consensus, since the French authorities dispute the extraterritorial reach of these sanctions”. This assessment was drawn by balancing the interests of French national policies, which denotes that relying on political considerations rather than legitimate international considerations concerning the legality of sanctions will open the door for domestic idiosyncratic views and interpretations, which in turn, will bar this concept to be applied hegemonically across different jurisdictions.

If the governing law of sanctions is determined by private international law, it may pose conceptual difficulties. Sanctions are international instruments hinging on the notion of sovereign equality. The underpinning principle of sovereign equality of states is deeply embedded in one of the main tenants of international law. Any actions impinging on that principle would therefore need to involve considerations of public policy. Public international law must impose limits to the scope and validity of sanctions and to governing law. To this end, using private international law approaches to ascertain the validity of sanctions will negate the character (or nature) of sanctions as a public international law instrument transcending national boundaries

Conclusion

This post has called into question the viability of a private international law analysis in reviewing the scope of the application of sanctions. It has contended that a private international law analysis borrows its genesis from the domestic law of the forum (state). Private international law analysis needs to have sufficient normative weight to scrutinize or inquire into the substance of sanction regimes. Further, invoking private international law principles does not preclude arbitrators from engaging in subjective assessments to examine the applicability of a sanctions regime. By abandoning a private international law analysis, the interpretation and enforceability of sanctions will become more anachronistic and predictable.

 

The Centre for Private International Law is organising an online research seminar on Beyond the Civil – Common Law Divide: Islamic Shari’a Principles in Shari’a Based International Arbitration Disputes on 14 March 2023, 14:00 – 15:30 UK time.

With the global growth in the Islamic finance industry, the conclusion of Islamic finance transactions, and the offering of Islamic finance products in non-Islamic states across the globe, intricate legal questions and applicable law issues have become exceedingly pertinent. It is in this context that the speaker, Prof Dr Mohamed Abdel Wahab, proposes to tackle the interplay between Islamic Shari’a principles and the applicable norms governing Shari’a-based contracts and disputes.

See event details and registration information.