Droit international général

by Jingru Wang, Wuhan University Institute of International Law

1. Background

A blocking statute is adopted by a country to hinder the extraterritorial application of foreign legislation.[1] For example, the EU adopted Council Regulation No 2271/96 (hereinafter “EU Blocking Statute”) in 1996 to protest the US’s extraterritorial sanctions legislation concerning Cuba, Iran and Libya.[2] Since Donald Trump became the US president, the US government officially defined China as its competitor.[3] Consequently, China has been increasingly targeted by US sanctions. For example, in 2018, the US imposed broad sanctions on China’s Equipment Development Department (EDD), the branch of the military responsible for weapons procurement and its director for violating the US law on sanctions against Russia.[4] In 2020, the US announced new sanctions on Chinese firms for aiding North Korea’s nuclear weapons program.[5] A number of “Belt and Road” countries are targeted by US primary sanctions, which means that Chinese entities may face a high risk of secondary sanctions for trading with these countries. In these contexts, Chinese scholars and policy makers explore the feasibility to enact blocking law to counter foreign sanctions.[6] On 9 January 2021, China’s Ministry of Commerce (hereinafter “MOFCOM”) issued “Rules on Counteracting Unjustified Extraterritorial Application of Foreign Legislation and Other Measures” (hereinafter “Chinese Blocking Rules”), which entered into force on the date of the promulgation.[7]

 

2. Analysis of the Main Content

Competent Authority: Chinese government will establish a “Working Mechanism” led by the MOFCOM and composed of relevant central departments, such as the National Development and Reform Commission. The Working Mechanism will take charge of counteracting unjustified extraterritorial application of foreign legislation and other measures (Art. 4).

Targeted extraterritorial measures: The Chinese Blocking Rules target foreign legislation and other measures unjustifiably prohibit or restrict Chinese parties from engaging in normal economic, trade and related activities with third state’s parties (Art. 2), which is the so-called “secondary sanction”. Namely, if China considers sanctions unilaterally imposed by the US against a third country unjustified and violating international law, it may nullify such sanctions and allow Chinese companies to continue to transact with the third country. These Rules do not impact restrictions on business activities between China and the sanctioning country.

Unlike the EU Blocking Statute, the Chinese Blocking Rules do not provide an annex listing the legislation subject to the blocking but grant the Working Mechanism discretion. To determine whether foreign legislation or other measures fall within the application scope of the Chinese Blocking Rules, the Working Mechanism shall consider (1) the international law and fundamental principle of international relations; (2) potential impact on China’s national sovereignty, security and development interests; (3) potential impact on the legitimate interest of the Chinese party and (4) all other factors (Art. 6). On the one hand, the non-exhaustive list grants the Working Mechanism broad flexibility to analyse on a case-by-case basis. China has repeatedly become the target of US secondary sanctions. An exhaustive list of foreign legislation and other measures is insufficient to deal with the changing situations. On the other hand, China is prudent in confrontation with other countries. In a press conference, the MOFCOM spokesman stated that “the working mechanism will closely follow the inappropriate extraterritorial application of relevant national laws and measures.”[8] Therefore, the response of other countries will influence the enforcement of the Chinese Blocking Rules.

It is noteworthy the Chinese Blocking Rules will not affect China’s performance of its international obligations. These Rules shall not apply to such extraterritorial application of foreign legislation and measures as provided for in treaties or international agreements to which China is a party (Art. 15).

Information reporting system: A Chinese party prohibited or restricted by foreign legislation and other measures from engaging in normal economic, trade and related activities with a third state’s party shall report such matters to the MOFCOM within 30 days (Art. 5). Otherwise, the Chinese party may be warned, ordered to rectify or fined (Art. 13). To encourage the information report, Art. 5 of the Chinese Blocking Rules also provides that the competent authority shall keep such report confidential at the request of the Chinese party. The staff of the competent authority may undertake administrative penalties if they fail with such obligation (Art. 14).

Concerning the Information reporting system, when the report obligation is triggered is unclear. Should the Chinese party report within 30 days after the foreign legislation is published or other measures are taken or after its actual operation is restricted? Moreover, since the Chinese Blocking Rules do not list targeted foreign legislation and other measures, the Chinese party should rely on their judgment to report. Finally, who should report on behalf of the legal person remains to be answered.

Prohibition order: Once the unjustified extraterritorial application of foreign legislation and other measures is confirmed, the Working Mechanism may decide that the MOFCOM shall issue a prohibition order to ban the effect of relevant foreign legislation and other measures (Art. 7). A Chinese party that fails to observe the prohibition order will be punished (Art. 13). Therefore, Chinese parties are forced to comply with either Chinese or foreign laws. In other words, they will be punished by one or the other. To free the party from the dilemma, a Chinese party may apply for exemption from compliance with a prohibition order (Art. 8). China-based subsidiaries of foreign companies are formed under Chinese law. They are considered to be Chinese entities. Therefore, unless otherwise provided by law, they are subject to the prohibition order issued under the Chinese Blocking Rules and can apply for the exemption.

One major uncertainty is whether third state’s parties are subject to the prohibition order. These Rules do not stipulate that foreign entities will be punished by violating the prohibition order or can apply for the exemption. However, it is suggested that the prohibition order may bind the third state’s party for two reasons. Firstly, the US may issue secondary sanctions to prohibit Chinese parties from trading with third state’s parties (Iran as an example), or to prohibit third state’s parties (EU as an example) from trading with Chinese parties. According to Art. 2 of the Chinese Blocking Rules, both situations may obstruct the normal economic, trade and related activities between the Chinese party and the third state’s party. If the prohibition order merely applies to the Chinese party, it cannot protect Chinese businesses from being prejudiced by the US secondary sanctions in the latter situation. Secondly, a Chinese party can bring a lawsuit before the People’s Court against the party who infringes the legitimate interest of such Chinese party by complying with the foreign legislation and other measures covered by the prohibition order (Art. 9). This article does not limit the defendant to “a Chinese party.” Thus it shall include the third state’s party. If the prohibition order does not bind the third state’s party, it is doubtful that such third state’s party is liable for not complying with the prohibition order.

The prohibition order refrains relevant parties from complying with specific foreign legislation and other measures. A question is how should the prohibition order be observed. According to the European Commission’s Guidance Note, the purpose of the EU Blocking Statute is to ensure that business decisions on trading with third States remain free. It does not oblige EU operators to do business with Iran or Cuba. Also, the Chinese Blocking Rules cannot and should not oblige the Chinese party and the third state’s party to engage with each other. Therefore, it raises the worry that these Rules may apply better for breach of existing contract but be more difficult to “force” someone to enter into a contract or in terms of the pre-contractual obligation.

Judicial Remedy: A Chinese party can bring a lawsuit before the People’s Court of PRC against the party who infringes its legitimate interest by complying with the foreign legislation or measures covered by the prohibition order. A Chinese party may also suit the party who benefits from the judgment or ruling made under such foreign legislation or other measures before the People’s Court (Art. 9). Problems may arise if the losing party has no asset in China seized for enforcement by the Chinese court. Other countries may be reluctant to recognize and enforce such judgment.

Government support: Members of the Working Mechanism shall provide guidance and service to Chinese parties to deal with unjustified extraterritorial application of foreign legislation and other measures (Art. 10). Suppose a Chinese party that observes the prohibition suffers significant losses resulting from non-compliance with the relevant foreign legislation and measures. In that case, relevant government departments may provide necessary support based on specific circumstances (Art. 11). Which government department is responsible for these matters? Does “Necessary support” include financial compensation or support on litigation in the sanctioning country? These questions remain to be answered.

 

3. Impact of the Blocking Statute

Considering that China has long suffered from secondary sanctions issued by the US government, promulgating the Chinese Blocking Rules is not a surprise. Overall, the Chinese Blocking Rules attempt to establish three core institutions anticipated by Chinese scholars: (1) blocking the effect and enforcement of specific foreign legislation in China; (2) prohibiting relevant parties from complying with specific foreign legislation and other measures; (3) enabling relevant parties to recover the damage from the party who complies with the foreign legislation and measures covered by the prohibition order. Therefore, a blocking statute serves as both shield and sword to fight against foreign sanctions.

But the function of blocking statute shall not be overemphasized. The same as the EU Blocking Statute, the Chinese Blocking Rules create a quandary for relevant parties.

For Chinese parties, if they comply with the Chinese prohibition order, they have to deal with US penalties. Chinese parties may invoke “foreign sovereign compulsion”[9] as a defence to insulate themselves from certain US sanctions penalties. In determining whether to buy such argument, US courts often consider whether foreign states actively enforce them.[10] The Chinese Blocking Rules can provide a legal basis for Chinese parties to exempt from the US sanctions by strategic enforcement actions. If so, Chinese parties will be relieved to transact with third state’s parties. But the Chinese government may not be willing to provide the same exemption. Out of self-interest, Chinese parties may be more likely to comply with the Chinese Blocking Rules.

These Rules have not yet stipulated the legal result if third states’ parties violate the Chinese prohibition order. In principle, prescriptive jurisdiction can be extraterritorial, but enforcement jurisdiction must be territorial. Therefore, China cannot always extend the effect of Blocking Rules to a third state’s party even if it has the will. However, it is reasonable to assume that third state’s parties may be added to the “unreliable entities list”[11] for disregarding the Chinese prohibition order. It may prompt third state’s parties to observe the Chinese prohibition order voluntarily to preserve their assets and reputation in China. But even if third state’s parties value the Chinese market, it is uneasy for them to choose China over the US.

China has become more active in exploring countermeasures against the US. On 19 September 2020, MOFCOM released provisions on establishing “unreliable entity list.”[12] Promulgation of the Chinese Blocking Rules is another proactive attempt. However, both are departmental rules, which are at a relatively low-level in the Chinese legal system. Predictably, higher-level legislation concerning the extraterritorial effect of foreign legislation and other measures will be enacted in the future. It may prompt China and the US back to the negotiating table.

[1] Menno T. Kamminga, “Extraterritoriality”, Max Planck Encyclopedia of Public International Law, November 2012, para. 26.

[2] COUNCIL REGULATION (EC) No 2271/96, available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:01996R2271-20140220.

[3] White House, National Security Strategy of the United States of America, December 2017.

[4] CAATSA – Russia-related Designations, available at: https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20180920_33. aspx.

[5] North Korea Designations, available at: https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20201208.

[6] Ye Yan, “On the EU Blocking Statute”, Pacific Journal, Vol. 28, No. 3, Mar. 2020, pp. 50-66; Huo Zhengxin, “Extraterritoriality of Domestic Law: American Model, Jurisprudential Deconstruction and Chinese Approach”, Tribune of Political Science and Law, Vol. 38, No. 2, Mar. 2020, pp. 173-191.

[7] Rules on Counteracting Unjustified Extraterritorial Application of Foreign Legislation and Other Measures, available at: http://www.mofcom.gov.cn/article/i/jyjl/e/202101/20210103032421.shtml.

[8] The Head of the Department of Treaty of Law of Ministry of Commerce answers press on “Rules on Counteracting Unjustified Extraterritorial Application of Foreign Legislation and Other Measures”, available at:  http://www.mofcom.gov.cn/article/news/202101/20210103029779.shtml.

 

[9] “Foreign Sovereign Compulsion” means that if a party is obliged to do or not to do an act by a state, it may constitute a defence for not complying with the obligation specified by the US law before the US court. See American Law Institute, Restatement of the Law, Third, The Foreign Relations Law of the United States, American Law Institute Publishers, 1990, p. 341.

[10] M. J. Hoda, “The Aerospatiale Dilemma: Why U.S. Courts Ignore Blocking Statutes and What Foreign States Can Do About It”, California Law Review, Vol. 106, No. 1, 2018.

[11] The entity added to the list will be restricted on China-related trade, investment in China and travel or work permits. See “MOFCOM Order No. 4 of 2020 on Provisions on the Unreliable Entity List”, available at:

http://www.mofcom.gov.cn/article/b/fwzl/202009/20200903002593.shtml.

[12] Ibid.

 

Membership 

On 19 January 2021, Namibia deposited its instrument of acceptance of the Statute, becoming the 87th Member of the HCCH. More information is available here. 

Conventions & Instruments  

On 1 January 2021, the HCCH 2000 Protection of Adults Convention entered into force for Belgium. The Convention currently has 13 Contracting Parties. More information is available here. 

On 1 January 2021, the United Kingdom’s new instrument of accession to the HCCH 2005 Choice of Court Convention and new instrument of ratification to the HCCH 2007 Child Support Convention entered into force. The United Kingdom has already been bound by the Choice of Court Convention since 2015 and by the Child Support Convention since 2014, by virtue of the European Union’s approval. To ensure continuity in their application following its withdrawal from the EU, the United Kingdom deposited these new instruments of accession and ratification on 28 September 2020. More information is available here. 

On 18 January 2020, Singapore deposited its instrument of accession to the HCCH 1961 Apostille Convention. With the accession of Singapore, the Apostille Convention now has 120 Contracting Parties. Singapore is the third ASEAN Member State to join the Apostille Convention. It will enter into force for Singapore on 16 September 2021. More information is available here. 

Meetings & Events 

From 22 to 27 January, the Applicable Law Working Group on the HCCH 2007 Maintenance Obligations Protocol met via videoconference. The Group provided guidance in relation to issues of applicable law arising from certain family relationships, the law applicable to preliminary / incidental questions, as well as the interpretation and scope of certain articles of the Protocol. More information is available here. 

Publications & Documentation 

On 29 January, the Permanent Bureau announced the publication of translations, in all European Union languages, of the Practical Handbook for Competent Authorities on the 2007 Child Support Convention, the 2007 Maintenance Obligations Protocol, and the 2009 EU Maintenance Regulation. The translations were made possible with the support of the Directorate-General for Justice and Consumers of the European Commission. The Handbook, originally published in English, French, and Romanian, was jointly developed by the HCCH, the Ministry of Justice of Romania, and the French National School for the Judiciary (ENM). 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. 

The Private International Law Interest Group of the Italian Society of International Law and EU Law has organised a series of webinar, most of which will be conducted in English, under the title Private International Law in Europe: Current Developments in Jurisprudence.

The programme is as follows:

29 January 2021, 4 to 6 PM (CET): Limiting European Integration through Constitutional Law? Recent Decisions of the German Bundesvarfassungsgericht and their Impact on Private International Law – Speaker: Christian Kohler (Univ. Saarbrücken); Discussant: Giulia Rossolillo (Univ. Pavia).

19 February 2021, 4 to 6 PM (CET): State Immunity and Jurisdiction in Civil and Commercial Matters in Recent Court of Justice Rulings – Speaker: Alexander Layton (King’s College London); Discussant: Lorenzo Schiano di Pepe (Univ. Genova).

12 March 2021, 4 to 6 PM (CET): La trascrizione dell’atto di nascita nella recente giurisprudenza della Corte costituzionale italiana – Speaker: Sara Tonolo (Univ. Trieste); Discussant: Elena Rodriguez Pineau (Univ. Autonóma Madrid).

9 April 2021, 4 to 6 PM (CET): Law Governing Arbitration Agreements in a Recent Judgment of the UK Supreme Court – Speaker: Adrian Briggs (Univ. Oxford); Discussant: Pietro Franzina (Catholic Univ. of the Sacred Heart, Milan).

23 April 2021, 4 to 6 PM (CET) (TBC): Jurisdiction in Matters Relating to Cross-Border Torts according to the Recent Volkswagen Judgment of the Court of Justice – Speaker: Giesela Rühl (Humboldt Univ. Berlin); Discussant: Fabrizio Marongiu Buonaiuti (Univ. Macerata).

More information available here.

Trower J confirmed mid-December (judgment was not published until earlier this week) jurisdiction for England and Wales courts over continental corporations using ‘Restructuring Plans’, in an echo of his earlier findings in Virgin Atlantic.  The plan has in the meantime also been sanctioned. Mother holding is a Dutch BV. Plan companies are all UK incorporated. Creditors in part UK based, largely non-UK based. However the presence of a sizeable number of them in E&W is held (36-38) to be sufficient to serve as anchor using A8(1) BIa.

As I flagged in my review of Virgin Atlantic, pre-Brexit and of course even more so post Brexit, jurisdiction for these Plans let alone their recognition and enforcement in the EU, involves additional challenges to Schemes of Arrangements. I have a paper on the issues forthcoming.

Geert.

EU private international law, 3rd ed. 2021, paras 5.35 ff

 

Convening order is now here https://t.co/ADUj1QubUO
(and sanctioning order https://t.co/8BtUzj8KMM)
Brussels Ia jurisdiction re Deep Ocean #restructuring 'Plan' addressed in two paras simply confirming indeed arguendo approach as under Schemes of Arrangement, anchor defendants. https://t.co/Qb4nH1cPQO

— Geert Van Calster (@GAVClaw) January 28, 2021

On 4 November 2020, the Austrian Supreme Court (OGH) ruled on the applicability of the consumer jurisdiction under Article 18 Brussels I bis Regulation to transactions related to Bitcoin.

Facts

The facts of this case were quite peculiar. An Austrian resident offered investment opportunities on a cross-border basis, which could only be paid for in Bitcoin. After being contacted by a German resident who expressed interest in the investment opportunities, the Austrian offeror sent three agents to the German customer.

The three agents brought with them a so-called Bitcoin ATM to carry out the transaction. Since the Bitcoin ATM did not function, they used the smartphone of the Austrian offeror, which they had also brought “just in case”, to transfer six Bitcoin belonging to the Austrian offeror to an investment account in the name of the German customer. It was agreed that the German customer would reimburse six Bitcoin within a month to the Austrian offeror.

When he failed to do so, he was sued by the Austrian offeror at the latter’s domicile in Austria.

In the proceedings, the German investor contested the jurisdiction of the Austrian courts.

Legal procedure

The Austrian courts at first and second instance dismissed the claim for lack of jurisdiction. They characterised the contract as a contract for the exchange of Bitcoin for the participation in the investment. This led them to apply Article 7(1)(a) Brussels I bis Regulation, with the consequence that (i) the place of performance for each obligation must be determined according to the governing national law and (ii) the governing national law must be identified through the use of the rules of private international law of the forum (see the now classic CJEU judgments in Tessili and De Bloos). The courts took the view that under both Austrian and German law, the place of performance of contracts of exchange is the place of domicile of the debtor of the respective obligation. Since the result was the same under both laws, it did not matter which of the two was applicable to the obligation to return the Bitcoin.

According to the same courts, it was of no relevance in this case if the contract were to be characterized not as a contract for exchange, but as a loan. In the latter case, the place of performance would still be the place of domicile of the debtor under Austrian and German law. This view, however, ignores that loan contracts are governed by the uniform jurisdiction rule of Article 7(1)(b) Brussels I bis Regulation (see CJEU C-249/16, Kareda). The place of performance for a Bitcoin loan would therefore be determined uniformly and in an autonomous way. The CJEU has also previously ruled that the place of performance for long-term contracts is uniformly located at the domicile of the lender (see again Kareda).

The decision by the Austrian Supreme Court

The Supreme Court of Austria cut short the legal debate. It ruled that the German investor acted for a purpose that could not be attributed to her professional or commercial activity, and that she was therefore a consumer in the sense of Article 17 Brussels Ibis Regulation. In the absence of evidence to the contrary, the Austrian offeror was to be assumed to have acted in a professional capacity and therefore as an entrepreneur. The Austrian offeror had also directed his activities to the consumer’s country of residence, as evidenced by the fact that he had marketed the investments in Germany and had recruited numerous investors there. Therefore, the consumer jurisdiction rules of Article 18 Brussels Ibis Regulation applied. As a result, the German investor could only be sued at her place of domicile in Germany (Article 18(2) Brussels Ibis Regulation). The Austrian courts therefore lacked jurisdiction. The action was dismissed.

Assessment

The case raises a number of interesting questions about Bitcoin transactions and jurisdiction. In particular, it illustrates the importance of the question of whether or not Bitcoin can be characterised as money for the purposes of EU Private International Law. If Bitcoin were money, the applicability of the rules on sales or service contracts for performances paid with Bitcoin could be envisaged. If, on the contrary, Bitcoin lacks the legal characteristics of money, any transaction in Bitcoin can only be qualified as a contract falling under Article 7(1)(a) Brussels I bis Regulation, with the result that jurisdiction will depend on the national rules governing the transaction and their characterisation of Bitcoin.

Unfortunately, the Austrian Supreme Court was able to avoid answering the questions on the legal nature of Bitcoin by resorting to the consumer jurisdiction rules. Given the considerable and growing economic importance of Bitcoin, it would be desirable to obtain legal certainty on these questions. But at the least, the ruling underlines the need for protecting Bitcoin investors, including at the level of jurisdiction. It can hardly be doubted that the result reached by the Austrian Supreme Court was appropriate. Investors should not have to sue at a place of domicile of the counterparty simply because an investment can only be paid for in cryptocurrency and not in legal tender.

From 22 to 27 January 2021, the Applicable Law Working Group on the Hague Conference Protocol of 23 November 2007 on the Law Applicable to Maintenance Obligations met via videoconference. The Conclusions & Recommendations summarising the outcomes of the meeting are attached to this post.

Source: https://www.hcch.net/en/news-archive/details/?varevent=783

law-applicable-to-maintenance-obligations-hague-working-groupDownload

Introduction

Cross border relations is bound to generate non-contractual disputes such as personal injury cases. In such situations, the law that applies is very important in determining the rights and obligations of the parties. The difference between two or more potentially applicable laws is of considerable significance for the parties involved in the case. For example a particular law may easily hold one party liable and/or provide a higher quantum of damages compared to another law. Thus, a preliminary decision on the applicable law could easily facilitate the settlement of the dispute between the parties without even going to trial.

Rome II Regulation[1] governs matters of non-contractual obligations. Article 4 of Rome II applies to general torts/delicts such as personal injury cases. It provides that:

1. Unless otherwise provided for in this Regulation, the law applicable to a non-contractual obligation arising out of a tort/delict shall be the law of the country in which the damage occurs irrespective of the country in which the event giving rise to the damage occurred and irrespective of the country or countries in which the indirect consequences of that event occur.
2. However, where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, the law of that country shall apply.
3. Where it is clear from all the circumstances of the case that the tort/delict is manifestly more closely connected with a country other than that indicated in paragraphs 1 or 2, the law of that other country shall apply. A manifestly closer connection with another country might be based in particular on a pre-existing relationship between the parties, such as a contract, that is closely connected with the tort/delict in question.

 

In the recent case of Owen v Galgey & Ors.,[2] the English High Court was faced with the issue of applying Article 4 of Rome II to a personal injury case. This comment disagrees with the conclusion reached by the High Court Judge in displacing English law under Article 4(2) of Rome II, and applying French law under Article 4(3) of Rome II.

 

Facts

The Claimant is a British citizen domiciled and habitually resident in England who brought a claim for damages for personal injury sustained by him as result of an accident in France on the night of April 3rd 2018, when he fell into an empty swimming pool which was undergoing works at a villa in France – a holiday home owned by the First Defendant, whose wife is the Second Defendant. The First and Second Defendants are also British citizens who are domiciled and habitually resident in England. The Third Defendant is a company domiciled in France, and the insurer of the First and Second Defendants in respect of any claims brought against them in connection with the Villa. The Fourth Defendant is a contractor which was carrying out renovation works on the swimming pool at the time of the accident, and the Fifth Defendant is the insurer of the Fourth Defendant. The Fourth and Fifth Defendants are both companies which are domiciled in France.

It was common ground between the parties that French law applied to the Claimant’s claims against the Fourth and Fifth Defendants. But there was a dispute at to the applicable law in relation to his claims against the First to Third Defendants. These Defendants contended that, by operation of Article 4(2) of Rome II, English law applies because the Claimant and the First and Second Defendants are habitually resident in England. However, the Claimant contended that French law applied by operation of Article 4(3) the Rome II because, he says, it is clear that the tort in this case is manifestly more closely connected with France than it is with England.

It was common ground that French law applied under Article 4(1) of Rome II because the direct damage occurred in France in this case; and English law applied under Article 4(2) of Rome II because the Claimant and First and Second Defendants were all habitually resident in England. The legal issue to be resolved was therefore whether under Article 4(3) the tort/delict was manifestly more closely connected to France than it is with England.

 

Decision

In a nutshell, Linden J held that French law applied under Article 4(3) of Rome II. The Court considered Article 4 of Rome II as a whole and read it in conjunction with both the Explanatory Memorandum[3] and Recitals to Rome II.[4]

Linden J held that Article 4(2) created a special rule which automatically displaced Article 4(1), and Article 4(2) was intended to satisfy the legitimate expectation of the parties.[5] On this basis, he observed that Article 4(2) could only apply in two party cases (only one victim and one tortfeasor), and not multi-party situations.[6] Linden J explicitly disagreed with an earlier decision of Dingemans J in Marshall v Motor Insurers’ Bureau & Ors[7] that held that Article 4(2) applied in multi-party situations.[8]

Linden J considered the relevant circumstances that could give rise to applying Article 4(3) in this case in the following chronological order:

1. the desire for a single law to govern the whole case involving the Claimant and the First to Fifth Defendants;[9]
2. the circumstances relating to all the parties in the case;[10]
3. the place of direct damage under Article 4(1);[11]
4. the habitual residences of the parties, including where any insurer defendants are registered at the time of the tortious incident and when the damage occurs;[12]
5. the habitual residence of the Claimant at the time of the consequences of the tort, including any consequential losses;[13]
6. the nationalities of the parties; [14] and
7. the fact that the parties have a pre-existing relationship in or with a particular country.[15]

Linden J held, following previous English decisions,[16] that the burden of proof was on the party that seeks to apply Article 4(3).[17] He held that Article 4(3) could only be applied as an exceptional remedy where a clear preponderance of factors supports its application.[18] However he observed that the facts of the case do not have to be unusual for Article 4(3) to apply, though Article 4(3) was intended to operate in a clear and obvious case.[19]

After considering the submission of the parties in the case, Linden J preferred the Claimant’s submission that Article 4(3) applied in this case. In his words: “France is where the centre of gravity of the situation is located and the preponderance of factors clearly points to this conclusion. This conclusion also accords with the legitimate expectations of the parties.”[20]

Linden J gave great weight to the place of direct damage. In his words:

“The tort/delict occurred in France, as I have noted. This is also where the injury or direct damage occurred. The dispute centres on a property in France and it concerns structural features of that property and how the First, Second and Fourth Defendants dealt with works on a swimming pool there. Although these defendants deny that there was fault on the part of any of them, the First and Second Defendants say that the Fourth Defendant was responsible if the pool presented a danger and the Fourth Defendant says that they were. The allegations of contributory negligence/fault also centre on the Claimant’s conduct whilst at the Villa in France.

The First and Second Defendants also had a significant and long-standing connection to France, the accident occurred on their property…

…the situation in relation to the swimming pool which is said to have been the cause of the accident was firmly rooted in France and it resulted from works which were being carried out by the Fourth Defendant as a result of it being contracted to do so by the First and Second Defendants. The liability of the First and Second Defendants, if any, will be affected by how they dealt with that situation, including by evidence about their dealings with the Fourth Defendant. That situation had no significant connections with England other than the nationality and habitual place of residence of the First and Second Defendants.”[21]

Linden J also gave great weight to the desire to apply a single law to govern the whole case against the First to Fifth Defendants.[22] In his words:

“…the works were carried out by a French company pursuant to a contract with them which is governed by French law. Their insurer, the Third Defendant, is a French company and they are insured under a contract which is governed by French law… It is also common ground that the claim against the Fourth Defendant, and therefore against the Fifth Defendant, also a French company, is entirely governed by French law and will require the court to decide whether the Fourth Defendant or, at least by implication, the First and Second Defendants were “custodians” of the property for the purposes of French law.”[23]

On the other hand Linden J did not give great weight to the common habitual residence, common nationalities and common domiciles of the Claimant and First and Second Defendants, and the place of consequential loss which pointed to England. Linden J did not consider the pre-existing relationship between the Claimant and First and Second Defendants to be a strong connecting factor in favour of English law applying in this case. He did not regard their relationship as contractual but one that appears to be “the agreement resulted from a casual conversation between social acquaintances in the context of mutual favours having been done in the past.”[24] He considered that if there was a contract between the parties, he would have held that French law applied under Article 4(3) of Rome I Regulation[25] because the parties mutually performed their obligations in France.

In the final analysis, Linden J held as follows:

“To my mind the tort/delict in this case is much more closely connected to the state of the swimming pool which, as I have said, was part of a property in France and resulted from the French law contract between the First and Second Defendants and the Fourth Defendant. If any of the Defendants is liable, that liability will be closely connected with this contract. This point, taken in combination with the other points to which I have referred, in my view clearly outweighs the existence of any contract with the Claimant relating to the Villa, even if I had found there to be a contractual relationship and even if it was governed by English law.

Similarly, although I have taken into account the nationality and habitual place of residence of the Claimant and the First and Second Defendants, these do not seem to me to alter the conclusion to which I have come. I have also taken into account the fact that the consequences of the accident have to a significant extent been suffered by the Claimant whilst he was in England, but in my view the other factors to which I have referred clearly outweigh this consideration.

I therefore propose to declare that the law applicable to the claims brought by the Claimant against the First, Second and Third Defendants is French law.”[26]

 

Comment

Owen is the second English case to utilise Article 4(3) as a displacement tool.[27] Interestingly, Owen and Marshall are both cases where Article 4(3) was used to trump Article 4(2) in order to restore the application of Article 4(1). These judicial decisions put to rest any contrary view that Article 4(3) cannot be used to restore the application of Article 4(1), when Article 4(2) automatically displaces Article 4(1). In this connection, I agree with the judges’ conclusion on the basis that Article 4(3) operates as an escape clause to both Article 4(1)&(2). Such an approach also honours the requirement of reconciling certainty and flexibility in Recital 14 to Rome II. A contrary approach will unduly circumscribe the application of Article 4(3) of Rome II.

I do not agree with Linden J that Article 4(2) of Rome II only applies in two party cases (one victim and one tortfeasor) and does not apply in multi-party cases. I prefer the contrary decision of Dingemans J in Marshall. Interpreting Article 4(2) as being only applicable to two party cases is a very narrow interpretation. Moreover, the fact that Article 4(2) is a strong exception to Article 4(1) does not mean that Article 4(2) should be unduly circumscribed. Article 4(2) should not be applied mechanically or without thought. It must be given some common sense interpretation that suits the realities of cross-border relations in torts.

Moving to the crux of the case, I disagree with the conclusion reached by Linden J that French law applied in this case. Applying the test of Article 4(3), the tort was not manifestly more closely connected with France. In other words, it was not obvious that Article 4(3) outweighed the application of Article 4(2). To my mind, the arguments between the opposing parties were evenly balanced as to whether the tort was manifestly more closely connected with France. Article 4(2) in this case, which pointed to English law, was also corroborated by the common domiciles and common nationalities of the Claimant and First and Second Defendants which should have been regarded as a strong connecting factor in this case. In addition, the non-contractual pre-existing relationship between the Claimant and First and Second Defendants, and consequential loss pointed to England, though I concede that these factors are not very strong in this case.

It is important to stress that Article 4(2) of Rome II is a fixed rule and not a presumption of closest connection as it was under Article 4(2) of the Rome Convention.[28] Once Article 4(2) of Rome II applies, it automatically displaces Article 4(1), except Article 4(3) regards the place of damage as manifestly more closely connected with another country. Linden J appeared to give decisive weight to the place of damage and the desire to apply a single law to all the parties in the case, but did not pay due regard to the fixed rule in Article 4(2) and the fact that it was corroborated by other factors such as the common nationalities and domiciles of the Claimant and First and Second Defendants involved in the case.

 

Conclusion

Owen presents another interesting case on the application of Article 4 of Rome II to personal injury cases. It is the second case an English judge would be satisfied that Article 4(3) should be utilised as a displacement tool. The use of the escape clause is by no means an easy exercise. It involves a degree of evaluation and discretion on the part of the judge. Indeed, Article 4(3) is very fact dependent. In this case, Linden J preferred the argument of the Claimant that French law applied in this case under Article 4(3). From my reading of the case, I am not convinced that this was a case where Article 4(3) manifestly outweighed Article 4(2). It remains to be seen whether the First, Second and Third Defendants will appeal the case, proceed to trial or settle out of court.

[1]Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations [2007] OJ L199/40 (“Rome II”). It takes effect in courts of Member States only for events giving rise to damage occurring after 11 January 2009, as decided by the Court of Justice of the European Union (CJEU) in Case C-412/10 Homawoo EU:C:2011:747 [37].

[2] [2020] EWHC 3546 (QB)

[3]Explanatory memorandum from the Commission, accompanying the Proposal for Rome II, COM(2003) 427final (Explanatory Memorandum).

[4] Ibid [15] – [24].

[5] Ibid [26] – [27].

[6] Ibid [27] – [29], [35]. However, the argument as to whether Article 4(2) applied only in two party situations was not put forward before Linden J.

[7] [2015] EWHC 3421 (QB) [17].

[8] Owen (n 2) [35].

[9] Ibid [36] – [38]. In this connection, Linden J considered and followed the decision in of Dingemans J in Marshall (n 7) [18].

[10]Owen (n 2) [39] – [45]. In this connection, Linden J considered and followed the decision of Cranston J in Pickard v Marshall & Ors [2017] EWCA Civ 17 [14] – [15].

[11]Owen (n 2) [46]. Linden J followed Winrow v Hemphhill & Anor. [2014] EWHC 3164 [43], and Dingemans J in Marshall (n 7) [19].

[12] Owen (n 2) [48]

[13] Ibid [49]. Linden J followed Winrow (n 11) [39]&[43] and  Stylianou v Toyoshima [2013] EWHC 2188 (QB). At paragraph 50 Linden J stated that less weight was to be given to this factor.

[14] Ibid [51]. Linden J followed Winrow (n 11) [54]&[55] and Marshall (n 7) [22].

[15] Ibid [52] – [[56]

[16] Winrow (n 11) [16] and Marshall (n 7) [20].

[17] Owen (n 2) [57].

[18]Ibid [58]

[19] Ibid [61].

[20] Ibid [74].

[21]Ibid [75]-[77]

[22] Indeed, it was common ground in this case that the contract of insurance between the First, Second and Third Defendants was governed by French law; the contract between the First Defendant and the Fourth Defendant was governed by French law; the contract of insurance between the Fourth and Fifth Defendants was governed by French law; and the Claimant’s claims against the Fourth and Fifth Defendants are governed by French law. Ibid [12]

[23]Ibid [76].

[24] Ibid [78].

[25]Regulation (Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations [2008] OJ L177/6 (“Rome I”).

[26] Ibid [81] – [83].

[27] Marshall (n 7) was the first case to successfully utilise escape clause as a displacement tool.

[28][1980] OJ L266.

The General Report on the second project led by the EAPIL Young EU Private International Law Research Network on Overriding Mandatory Rules in the Law of the EU Member States, under the supervision of Tamás Szabados (University of Budapest), has just been published in the ELTE Law Journal, along with the written versions of some of the contributions of the online conference on the topic, organised in November 2020.

The editorial by Tamás Szabados reads as follows:

The Young European Union Private International Law Research Network was established in 2019 in order to promote academic cooperation within the young generation of private international lawyers in the European Union. The activity of the Network centres around projects and the project theme for 2020 was the application of overriding mandatory norms.

Overriding mandatory norms are beloved subjects for private international lawyers. Most often, however, they are analysed in the context of EU private international law, and principally in contract law, without due regard to other situations where overriding mandatory provisions may equally claim application. Therefore, the primary goal of the project was to reveal whether and to what extent overring mandatory provisions are applied in the autonomous private international law of the Member States, i.e. outside the scope of application of the EU private international law regulations. Some findings have been made in the general report prepared in the framework of the project, based on the contributions of national reporters from seventeen Member States. The report, however, clearly demonstrates that the application or consideration of overriding mandatory rules is also admitted in the autonomous private international law of the Member States, and most notably they involve rules on personal status and family law, property law and company law.

This enquiry on the application of overriding mandatory provisions in autonomous private international law is supplemented by the discussion of topics related to the application of overriding mandatory rules in private international law and arbitration. Martina Melcher examines which substantive law rules of EU law may qualify as overriding mandatory provisions under the Rome I and Rome II Regulations. Katažyna Bogdzevič puts the application of overriding mandatory provisions in family law and regarding names under scrutiny. Markus Petsche addresses the application of mandatory rules in international commercial arbitration. Uglješa Grušić discusses the implications of some recent English conflict-of-laws cases concerning the application of overriding mandatory provisions, such as Lilly Icos LLC v 8PM Chemists Ltd and Les Laboratoires Servier v Apotex Inc. Finally, the approach of the new Hungarian Private International Law Act towards overriding mandatory norms is presented by Csenge Merkel and Tamás Szabados.

The recent COVID-19 pandemic sadly enlightens a further category of overriding mandatory norms: public health measures. Measures related to the prevention of the spread of the coronavirus, introduced by many states around the world, can be considered as overriding mandatory norms. They include closing borders, cities and workplaces, ordering the cancellation of large-scale events, such as theatre and cinema shows or concerts, a mandatory ban on flights or road transport and the expropriation of local face masks production and stocks.

It was planned to hold a conference at ELTE Eötvös Loránd University with the participation of the project participants in March 2020 to discuss the research outcomes. The coronavirus epidemic interfered with this plan. However, academic cooperation continued without interruption. The conference has been scheduled for a later date and moved to the online space. Moreover, the written versions of the planned conference lectures can now be published in the ELTE Law Journal. The disease could reimpose borders across Europe, but this cannot prevent scholarly exchange. This is proved in this issue of the ELTE Law Journal.

Contributors include Tamás Szabados, Melcher, Katažyna Bogdzevič, Markus Petsche, Uglješa Grušić, and Csenge Merkel.

The full issue is available here.

 

In July 2020, Luxembourg eventually adopted a statute on Civil Liability for Harm related to a Nuclear Accident. The statute imposes strict liability on operators of nuclear installations for any damage that a nuclear accident might cause.

There is, however, no nuclear installation in Luxembourg, and there will not be anytime soon. A constant source of disagreement and discussion between the Grand Duchy and France is the French nuclear power plant of Cattenom, which sits a few kilometers away from the border (France has the curious habit of sitting its nuclear plants on the border with neighbouring states). In other words, the new Luxembourg law is solely concerned with foreign nuclear facilities, and indeed essentially with the one in Cattenom (there are also nuclear plants in Belgium, but farther from the border with Luxembourg).

Cattenom: A view from Luxembourg (Picture: Paperjams News) 1960 Paris Convention

The first question arising from the adoption of this statute is why luxembourg did not join instead the 1960 Paris Convention on Nuclear Third Party Liability (Luxembourg signed the Convention, but did not ratify it). The Luxembourg lawmaker explained that it felt that the goal of the Convention was only to limit the liability of nuclear operators, and that it was therefore not in the interest of a country which did not have any nuclear facilities to join the Convention.

In particular, the Luxembourg lawmaker wanted to avoid the numerous limitation of the liability of nuclear operators laid down by the Convention (maximum amount for compensation, time limits, limitation to certain types of losses), but also the exclusive jurisdiction of the court of the place of the operation of the nuclear facility, which would obviously exclude the jurisdiction of Luxembourg courts.

The Luxembourg lawmaker noted that Austria had also adopted its own legislation, and that the goal was to follow this path. It also noted that major nuclear powers such as the U.S., Russia or Japan never joined the 1960 Convention anyway.

Jurisdiction

Article 5 of the statute provides that Luxembourg courts have jurisdiction to entertain

actions related to nuclear losses resulting from nuclear accidents insofar as the Luxembourg territory, Luxembourg residents or person on Luxembourg territory at the time of the torts are concerned.

Parliamentary procedure in Luxembourg includes a review of bills by an independent body, the Council of State (Conseil d’Etat). In its opinion, the Council of State remarked that the Brussels I bis Regulation applied, and therefore requested (but did not demand) that the provision clarifies that it would only apply subject to the Regulation. The opinion of the Council was not followed.

It is likely that the Regulation would grant jurisdiction to Luxembourg courts anyway on the ground of the place of the damage, but only if direct damage was suffered in Luxembourg. The first draft of the bill expressly provided that it would apply to “losses caused directly or indirectly” by nuclear accidents, but, after the Council of State pointed out that this would be hard to reconcile with the concept of causation under the Luxembourg law of torts (which would apply: see below), the referrence was eventually omitted.

This being said, it is a bit problematic that the Brussels Ibis Regulation could limit the power of a Member State to develop its nuclear policy. This was the goal of the exclusion of public matters from the scope of the Regulation, but in this context it seems quite narrow. The Rome II Regulation allows Member States to adopt overriding mandatory provisions, but who will apply them if the Member States may not grant jurisdiction to their courts to apply them?

Of course, the Regulation would not apply if the defendant was domiciled in a third state (say, Ukraine…).

Picture : Les Echos Applicable Law

Article 6 of the statute provides that “In case of nuclear accidents, actions for civil liability are governed by Luxembourg law“.

Unlike jurisdiction, the Rome II Regulation expressly excludes from its scope nuclear liability. Even if it had not, the statute could certainly have qualified as an overriding mandatory provision.

Enforcement of Luxembourg Judgments Abroad

The statute is silent on the enforcement of Luxembourg judgements abroad. Quite obvious, isn’t it? How could Luxembourg possibly think about regulating enforcement of judgments abroad?

Not as obvious in Luxembourg, it seems. The bill initially included an additional provision stating that “Any judgment from a Luxembourg court which is res judicata cannot be reviewed on the merits“. Fortunately, the Council of State explained in its opinion that it understood that the purpose of the provision was to bind foreign courts, and formally opposed its adoption on the ground that it would violate the sovereignty of foreign states and public international law.

Sovereign Immunity

The statute is silent on sovereign immunity. The initial bill was silent as well, but defined “operators” as including “international organisations” and “states or any other public authority”. The Council of State wondered what was the goal of the drafters of the bill, and whether they genuinely intended that foreign states could be sued in Luxembourg courts and their nuclear policy challenged, and if so on which basis. These express references were eventually omitted from the statute, which defines operators as any person who has a power of decision with respect to, or benefits economically from, a nuclear facility.

Irrespective of whether the final definition of operators excludes states and international organisations (the Nuclear Energy Agency?), it is easy to imagine that private operators could be closely linked to states, and thus appear as emanations of states and benefit from sovereign immunities.

Conclusion: Preparing Future Negotiations? Source: antiatomnetz-trier.de

France and Luxembourg established a Franco-Luxembourg Commission on Nuclear Safety in 1994 which has met 18 times since then. In the last meeting in February 2020, France made clear that Cattenom would not be closed before 2035. The Luxembourg government has long expressed its disagreement with the facility being further maintained in operation.

The Luxembourg press has reported that some Luxembourg politicians hope that the law will increase the costs of neighbouring states, including insurance premiums, to operate nuclear facilities near Luxembourg. Will this change the dynamics of future negotiations between France and Luxembourg?

The latest issue of the „Praxis des Internationalen Privat- und Verfahrensrechts (IPRax)“ features the following articles:

 

R. Wagner: Judicial cooperation in civil and commercial matters after Brexit

Brexit has become a reality. When the UK left the EU on 31 January 2020 at midnight, it entered the transition period stipulated in the UK-EU Withdrawal Agreement. During this period, EU law in the field of judicial cooperation in civil and commercial matters applied to and in the United Kingdom. The transition period ended on 31 December 2020. The following article primarily describes the legal situation in the judicial cooperation in civil and commercial matters from 1 January 2021.

Addendum: At the time when this contribution was written, the conclusion of a Trade and Cooperation Agreement between the EU and United Kingdom still was uncertain. Meanwhile, the Agreement of 24 December 2020 has come into existence. It is applicable provisionally since 1 January 2021 for a limited period and will be permanently applicable when after ratification it has formally come into force. The Agreement does not envisage any additional provisions on judicial cooperation in civil and commercial matters between the United Kingdom and the EU. Therefore, it has to be concluded that the present article reflects the current state of law as established by the Trade and Cooperation Agreement (Rolf Wagner).

 

K. Thorn/K. Varón Romero: Conflict of laws in the “Twilight Zone” – On the reform of German private international law on welfare relationships

With the government draft of 25 September 2020, a comprehensive reform of guardianship and care law is approaching which will fundamentally modernize these areas. This reform also includes an amendment to the autonomous conflict-of-law rules in that area. The most important changes within this amendment concern the provisions of the Introductory Act to the German Civil Code (EGBGB). On the one hand, it includes a methodological change to the relevant Article 24 EGBGB which takes greater account of its role as a merely supplementary provision to prior international treaties and Union law. The authors welcome the changes that this will entail but point out that some clarifications are still needed before the reform is completed, particularly in cases of a change in the applicable law. On the other hand, a new Article 15 EGBGB is intended to create a special conflict-of-law rule for the mutual representation of spouses which is based on the also new substantive rule of Section 1358 of the German Civil Code (BGB) and is designed as a unilateral conflict-of-law rule in favour of domestic substantive law. The authors basically agree with the reasoning for this approach and in addition address questions which remain unresolved even after reading the reasoning, in particular the relationship between Article 15 of the Introductory Act to the Civil Code and the conflict-of-law rules of Union law.

 

 D. Coester-Waltjen: Conflict rules on formation of marriage – Some reflections on a necessary reform

The conflict rule on formation of marriages (Article 13 Introductory Law to the Civil Code) underwent several changes during the last years. In addition, societal conditions and circumstances changed considerably. It seems at least questionable whether the cumulative application of the national law of both prospective spouses in case of a heterosexual marriage and the law of the place of registration in case of a homosexual marriage provides a reasonable solution. The article deals with a possible reform of the conflict rule on formation of marriage and envisages whether a comparable solution might be found for other (registered or factual) relationships.

 

U.P. Gruber: Reflections on the reform of the conflict of laws of the registered life partnerships and other partnerships

Under the current law, the formation of a registered life partnership, its general effects and its dissolution are governed by the substantive provisions of the country in which the life partnership is registered. The article deals with a possible reform of this rule. In particular, it addresses the question whether there can be a convergence of the private international law for marriage and registered partnership. Moreover, the article discusses a conflict-of-law rule for de facto relationships.

 

F. Temming: Payment of wage supplements in respect of annual leave constitute a civil and commercial matter within the scope of Art. 1 Brussels Regulation

In its judgement the CJEU holds that an action for payment of wage supplements in respect of annual leave pay brought by a body competent to organize the annual leave of workers in the construction sector against an employer, in connection – among others – with the posting of workers to a Member State where they do not have their habitual place of work, can be qualified as a “civil and commercial matter” for the purpose of the Brussels Ibis Regulation and, thus, falls within the scope of its Article 1. This can even be the case if the competent body is governed by public law, such as the Construction Workers’ Leave and Severance Pay Fund of Austria (hereinafter “BUAK”), provided that it does not act under a public law prerogative of its own conferred by law. This case note argues that the contested section 33h (2b) of the BUAG does not constitute such a prerogative but rather can be construed according to EU law in such a manner that an Austrian court can fully review the accuracy of a claim relied on by BUAK. The importance of the Korana judgement of the CJEU lies in the fact that it ensures the recognition and enforcement of judgments according to Art. 36 ff. of the Brussels I Regulation in favour of these above mentioned bodies. In so doing the CJEU strengthens the regulatory framework set up by the revised Posting of Workers Directive 96/71/EC. It marks the procedural keystone of a long-standing CJEU jurisprudence enabling a special, however adequate and institutionalised system of granting annual leave in the building sector. At the same time, it sends a clear signal towards the Swiss Federal Court that took a contrary view with respect to Art. 1 of the Lugano Convention 2007.

 

 F. Maultzsch: International Jurisdiction for Liability and Recourse Claims in the Wake of Cum-Ex Transactions

The Higher Regional Court of Frankfurt (OLG Frankfurt a.M.) had to deal with issues of international jurisdiction for liability and recourse actions resulting from so-called cum-ex transactions that failed on a tax-based level. In doing so, the court took position on diverse jurisdictional issues under the Brussels Ibis Regulation. These issues covered the requirements of a sufficient contest of jurisdiction by the defendant in appellate proceedings, a possible jurisdiction under Art. 7 No. 5 Brussels Ibis Regulation for disputes arising out of the operations of a branch, aspects of characterization regarding the forum of the contract (Art. 7 No. 1 Brussels Ibis Regulation), as well as the standards of international jurisdiction for a recourse claim from joint and several liability for tax payments. The following article analyses the findings of the court and discusses, inter alia, the application of Art. 26 Brussels Ibis Regulation in cases of a modification of the matter in dispute.

 

J. Schulte: A reinforced EU trademark through a strengthened alternative forum

The EU trademark has been strengthened when it comes to infringements via internet by the recent ECJ decision in AMS Neve, reviving the alternative forum of the place where an act of infringement has been committed or threatened. The Court ruled out an interpretation not congruent with that in Art. 8 (2) Rome II (applicable law) or Art. 7 no. 2 Brussels Ia (international jurisdiction for national trademarks). Instead, it transferred the EU Trademark Regulation’s substantive law understanding, thus guaranteeing a uniform interpretation of the regulation. Competent are the courts of the Member State where the consumers or traders are located to whom an allegedly infringing advertising or offers for sale are directed. This reverses the unfortunate “Parfummarken”-doctrine of the German Bundesgerichtshof and gives plaintiffs more leeway for choosing a forum and the possibility of bringing actions for infringements of EU and national trademarks simultaneously at the same court.

 

H. Schack: Does Art. 27 Lugano Convention permit requiring a special legitimate interest in actions for negative declaratory relief?

In an antitrust dispute between a Swiss watch manufacturer and a British wholesaler the Swiss Federal Court gives up its former holding (BGE 136 III 523) that a Swiss action for negative declaratory relief required a special legitimate interest. Today, at least in international cases, the plaintiff’s mere interest in fixing the forum is sufficient. That strengthens the attractiveness of Swiss courts in transborder cases.

Eduardo Álvarez-Armas is Lecturer in Law at Brunel University London and Affiliated Researcher at the Université Catholique de Louvain. He has kindly provided us with his thoughts on recent proposals for amending the Rome II Regulation. This is the second part of his contribution; a first one on the law applicable to strategic lawsuits against public participation can be found here.

Over the last few months, the European Parliament´s draft report on corporate due diligence and corporate accountability (2020/2129(INL)) and the proposal for an EU Directive contained therein have gathered a substantial amount of attention (see, amongst others, blog entries by Geert Van Calster, Giesela Rühl, Jan von Hein, Bastian Brunk and Chris Thomale). As the debate is far from being exhausted, I would like to contribute my two cents thereto with some further (non-exhaustive and brief) considerations which will be limited to three selected aspects of the proposal´s choice-of-law dimension.

1. A welcome but not unique initiative (Comparison with the UN draft Treaty)

Neither Article 6a of Rome II nor the proposal for an EU Directive are isolated initiatives. A so-called draft Treaty on Business and Human Rights (“Legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises”) is currently being prepared by an Open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights, established in 2014 by the United Nation´s Human Rights Council. Just like it is the case with the EP´s proposal, the 2nd revised UN draft Treaty (dated 6th August 2020) (for comments on the applicable law aspects of the 1st revised draft, see Claire Bright´s note for the BIICL here) contains provisions on international jurisdiction (Article 9, “Adjudicative Jurisdiction”) and choice of law (Article 11, “Applicable law”).

Paragraph 1 of the latter establishes the lex fori as applicable for “all matters of substance […] not specifically regulated” by the instrument (as well as, quite naturally, for procedural issues). Then paragraph 2 establishes that “all matters of substance regarding human rights law relevant to claims before the competent court may, upon the request of the victim of a business-related human rights abuse or its representatives, be governed by the law of another State where: a) the acts or omissions that result in violations of human rights covered under this (Legally Binding Instrument) have occurred; or b) the natural or legal person alleged to have committed the acts or omissions that result in violations of human rights covered under this (Legally Binding Instrument) is domiciled”.

In turn, the proposed Article 6a of Rome II establishes that: “[…] the law applicable to a non-contractual obligation arising out of the damage sustained shall be the law determined pursuant to Article 4(1), unless the person seeking compensation for damage chooses to base his or her claim on the law of the country in which the event giving rise to the damage occurred or on the law of the country in which the parent company has its domicile or, where it does not have a domicile in a Member State, the law of the country where it operates.” (The proposed text follows the suggestions made in pp. 112 ff of the 2019 Study requested by the DROI committee (European Parliament) on Access to Legal Remedies for Victims of Corporate Human Rights Abuses in Third Countries.)

Putting aside the fact that the material scopes of the EP’s and the UN’s draft instruments bear differences, the EP´s proposal features a more ambitious choice-of-law approach, which likely reflects the EU´s condition as a “Regional integration organization”, and the (likely) bigger degree of private-international-law convergence possible within such framework. Whichever the reasons, the EP´s approach is to be welcomed in at least two senses.

The first sense regards the clarity of victim choice-of-law empowerment. While in the UN proposal the victim is allowed to “request” that a given law governs “all matters of substance regarding human rights law relevant to claims before the competent court”, in the EP´s proposal the choice of the applicable law unequivocally and explicitly belongs to the victim (the “person seeking compensation for damage”). A cynical reading of the UN proposal could lead to considering that the prerogative of establishing the applicable law remains with the relevant court, as the fact that the victim may request something does not necessarily mean that the request ought to be granted (Note that paragraph 1 uses “shall” while paragraph 2 uses “may”). Furthermore, the UN proposal contains a dangerous opening to renvoi, which would undermine the victim´s empowerment (and, to a certain degree, foreseeability). Therefore, if the goal of the UN´s provision is to provide for favor laesi, a much more explicit language in the sense of conferring the choice-of-law prerogative to the victim would be welcomed.

2. A more ambitious initiative (The “domicile of the parent” connection, and larger victim choice)

A second sense in which the EP´s choice-of-law approach is to be welcomed is its bold stance in trying to overcome some classic “business & human rights” conundrums by including an ambitious connecting factor, the domicile of the parent company, amongst the possibilities the victim can choose from. Indeed, I personally find this insertion in suggested Art. 6a Rome II very satisfying from a substantive justice (favor laesi) point of view: inserting that very connecting factor in Art. 7 Rome II (environmental torts) is one of the main de lege ferenda suggestions I considered in my PhD dissertation (Private International Environmental Litigation before EU Courts: Choice of Law as a Tool of Environmental Global Governance, Université Catholique de Louvain & Universidad de Granada, 2017. An edited and updated version will be published in 2021 in Hart´s “Studies in Private International Law”), in order to correct some of the shortcomings of the latter. While not being the ultimate solution for all the various hurdles victims may face in transnational human-rights or environmental litigation, in terms of content-orientedness this connecting factor is a great addition that addresses the core of the policy debate on “business & human rights”. Consequently, I politely dissent with Chris Thomale´s assertion that this connecting factor “has no convincing rationale”. Moreover, I equally dissent from the contention that a choice between the lex loci damni and the lex loci delicti commissi is already possible via “a purposive reading of Art. 4 para 1 and 3 Rome II”. For reasons I have explained elsewhere, I do not share this optimistic reading of Art. 4 as being capable of filling the transnational human-rights gap in Rome II. And even supposing that such interpretation was correct, as draft Art. 6a would make explicit what is contended that can be read into Art. 4, it would significantly increase legal certainty for victims and tortfeasors alike (as otherwise some courts could potentially interpret the latter Article as suggested, while others would not).

Precisely, avoiding a decrease in applicable-law foreseeability seems to be (amongst other concerns) one of the reasons behind Jan von Hein´s suggestion in this very blog that Art. 6a´s opening of victim´s choice to four different legal systems is excessive, and that not only it should be reduced to two, but that the domicile of the parent should be replaced by its “habitual residence”. Possibly the latter is contended not only to respond to systemic coherence with the remainder of Rome II, but also to narrow down options: in Rome II the “habitual residence” of a legal person corresponds only with its “place of central administration”; in Brussels I bis its “domicile” corresponds with either “statutory seat”, “central administration” or “principal place of business” at the claimant´s choice. Notwithstanding the merits in system-alignment terms of this proposal, arguably, substantive policy rationales (favor laesi) ought to take precedence over pure systemic private-international-law considerations. This makes all the more sense if one transposes, mutatis mutandis, a classic opinion by P.A. Nielsen on the three domiciles of a corporation under the “Brussels” regime to the choice-of-law realm: “shopping possibilities are only available because the defendant has decided to organise its business in this way. It therefore seems reasonable to let that organisational structure have […] consequences” (P. A. NIELSEN, “Behind and beyond Brussels I – An Insider´s View”, in P. DEMARET, I. GOVAERE & D. HANF [eds.], 30 years of European Legal Studies at the College of Europe [Liber Professorum 1973-74 – 2003-04], Cahiers du Collège d´Europe Nº2, Brussels, P.I.E.-Peter Lang, 2005, pp. 241-243).

And even beyond this, at the risk of being overly simplistic, in many instances, complying with four different potentially applicable laws is, actually, in alleged overregulation terms, a “false conflict”: it simply entails complying only with the most stringent/restrictive one amongst the four of them (compliance with X+30 entails compliance with X+20, X+10 and X). Without entering into further details, suffice it to say that, while ascertaining these questions ex post facto may be difficult for victim´s counsel, it should be less difficult ex ante for corporate counsel, leading to prevention.

3. A perfectible initiative (tension with Article 7 Rome II)

Personally, the first point that immediately got my attention as soon as I heard about the content of the EP report´s (even before reading it) was the Article 6a versus Article 7 Rome II scope-delimitation problem already sketched by Geert Van Calster: when is an environmental tort a human-rights violation too, and when is it not? Should the insertion of Art. 6a crystallize, and Art. 7 remain unchanged, this question is likely to become very contentious, if anything due to the wider range of choices given by the draft Art. 6a, and could potentially end before the CJEU.

What distinguishes say Mines de Potasse (which would generally be thought of as “common” environmental-tort situation) from say Milieudefensie v. Shell 2008 (which would typically fall within the “Business & Human Rights” realm and not to be confused with the 2019 Milieudefensie v. Shell climate-change litigation) or Lluiya v. RWE (as climate-change litigation finds itself increasingly connected to human-rights considerations)? Is it the geographical location of tortious result either inside or outside the EU? (When environmental torts arise outside the EU from the actions of EU corporations there tends to be little hesitation to assert that we are facing a human-rights tort). Or should we split apart situations involving environmental damage stricto sensu (pure ecological damage) from those involving environmental damage lato sensu (damage to human life, health and property), considering only the former as coming within Art. 7 and only the latter as coming within Art. 6a? Should we, alternatively, introduce a ratione personae distinction, considering that environmental torts caused by corporations of a certain size or operating over a certain geographical scope come within Art. 6a, while environmental torts caused by legal persons falling below the said threshold (or, rarely, by individuals) come within Art. 7?

Overall, how should we draw the boundaries between an environmental occurrence that qualifies as a human-rights violation and one that does not in order to distinguish Art. 6a situations from Art. 7 situations? The answer is simple: we should not. We should consider every single instance of environmental tort a human-rights-relevant scenario and amend Rome II accordingly.

While the discussion is too broad and complex to be treated in depth here, and certainly overflows the realm of private international law, suffice it to say that (putting aside the limited environmental relevance of the Charter of Fundamental Rights of the EU) outside the system of the European Convention of Human Rights (ECHR) there are clear developments towards the recognition of a human right to a healthy or “satisfactory” environment. This is already the case within the systems of the American Convention on Human Rights (Art. 11 of the Additional Protocol to the Convention in the area of Economic, Social and Cultural Rights) and the African Charter on Human and People´s Rights (Art. 24). It is equally the case as well in certain countries, where the recognition of a fundamental/constitutional right at a domestic level along the same lines is also present. And, moreover, even within the ECHR system, while no human right to a healthy environment exists as such, the case-law of the European Court of Human Rights has recognized environmental dimensions to other rights (Arts. 2 and 8 ECHR, notably). It may therefore be argued that, even under the current legal context, all environmental torts are, to a bigger or lesser extent, human-rights relevant and (save those rare instances where they may be caused by an individual) “business-related”.

Ultimately, if any objection could exist nowadays, if/when the ECHR system does evolve towards a broader recognition of a right to a healthy environment, there would be absolutely no reason to maintain an Art. 6a versus Art. 7 distinction. Thus, in order to avoid opening a characterization can of worms, it would be appropriate to get “ahead of the curve” in legislative terms and, accordingly, use the proposed Art. 6a text as an all-encompassing new Art. 7.

There may be ways to try to (artificially) delineate the scopes of Articles 7 and 6a in order to preserve a certain effet utile to the current Art. 7, such as those suggested above (geographical location of the tortious result, size or nature of the tortfeasor, type of environmental damage involved), or even on the basis of whether situations at stake “trigger” any of the environmental dimensions of ECHR-enshrined rights. But, all in all, I would argue towards using the proposed text as a new Art. 7 which would comprise both non-environmentally-related human-rights torts and, comprehensively, all environmental torts.

Art. 7 is dead, long live Article 7.

 

 

In February 2019, Michael G. Faure (Maastricht University and Erasmus Law School Rotterdam) and Kévine Kindji (Maastricht University) presented to the European Parliament a Study on Cross-border nuclear safety, liability and cooperation in the European Union.

The abstract reads:

This study, commissioned by the European Parliament’s Policy Department for Citizens’ Rights and Constitutional Affairs at the request of the PETI Committee, aims at gaining deeper insights into the legal aspects of cross border nuclear safety and cooperation in the European Union. It analyses the legal framework of nuclear safety as well as the liability and insurance schemes for nuclear accidents. The study examines the current liability and insurance framework and formulates possibilities for a further involvement of the EU in the liability regime. Specific attention is paid to citizen and NGO involvement in decision-making concerning nuclear power plants. The study analyses the case law in that respect and formulates various recommendations to improve the regime concerning cross-border nuclear safety, liability and corporation in the EU.

The study can be freely downloaded here.

written by Cristina González Beilfuss and Marta Pertegás Sender

It is with deep sadness that we write these lines to honour the memory of our dear mentor Alegría Borrás. Alegría unexpectedly passed away at the end of last year and, although she had been battling cancer for a while, she continued working as always. For Alegría was a hardworking fighter who sought and found her notorious place in life with determination, courage and borderless efforts. We believe we speak here for so many of Alegría’s alumni who miss her deeply and are determined to pay tribute to her memory with our work and memories.

We both had the great privilege of Alegría’s support for years and decades, from the moment she taught us at the “barracones” of the Law Faculty of the University of Barcelona until the very last day of Alegría’s life. Her death surprised us all on one of those typical “Alegría’s days” of frantic activity and unconditional support to the projects and institutions she believed in.

With this homage, we by no means pretend to recap all her merits and achievements. We are thankful that, while still alive, Alegría received many distinctions and exceptional prizes for all she meant to the (international legal) community.

All those who once met Alegría may inevitably think of her characteristic high voice and strong presence while remembering her. To us, it is her unique insight, tireless professionalism and devoted expertise that made Alegría the exceptional mentor she was.

In every assignment Alegría carried out – regardless the size of the task or its specific context -, Alegría showed profound dedication and daily perseverance. Behind a  joie de vivre  – how can one by the name of Alegría otherwise come across? – there was an exemplary academic rigor and uncountable hours of day and night work.

Alegría will always be remembered as someone who transformed our discipline in recent years. She did so, from her Chair in Barcelona, where many of us first discovered private international law thanks to her teaching. Her classes were enriched by the many anecdotes of places (Brussels, The Hague…) and instances (the GEDIP, l’Institut, the Academy, …) that, back then, sounded like remote laboratories of private international law. Little did we know that we would marvel around the privilege of sharing missions and tasks with Alegría in such venues in the years to follow.

We have indeed witnessed how Alegría contributed, to the approximation of Spain to such poles of uniform private international law. For decades, Alegría wisely brought Spain to any negotiation table on private international law, and she proudly brought the results of such international work back home. We think it is fair to say that, without Alegría, international and European private international law might not have the right channels to permeate into the Spanish legal system. This is not a sporadic success; it requires titanic efforts and perseverance for decades. Actually, for Alegría, her international work was much more than the daily sessions at the Peace Palace or at the Council, the overnight work in committees and working groups or the taxi rides from and to the airport in rainy and grey weather. There was so much more… She made time for beautifully written and detailed reports to the relevant Ministries, for influential contacts with diplomatic posts and, not to forget, for raising awareness among the academic community. Her regular contributions to the Revista Jurídica de Catalunya , to the Revista Española de derecho internacional or to the Anuario español de Derecho internacional privado guided  Spanish lawyers eager to keep track on “what was going on in Brussels or The Hague”. Alegría knew how the machinery of international relations works and used these insights brilliantly to connect Spain to the international legal community, and vice versa.

The readers of Conflictsoflaws.net may associate the name of Alegría Borrás with significant milestones in the development of private international law over the past decades: Alegría was a key delegate of the Hague’s Children Conventions, the Co-Rapporteur of the Child Support Convention, the Rapporteur of the Brussels II Convention, the author of influential work on conflicts of instruments (perhaps we should refer to the “Borrás clause” as shortcut for the “clauses de déconnection”). We are also aware that there is so much more, because, no matter how important her international projects were, Alegría remained truly anchored at home, in her city and her University as a member of the Acadèmia de Legislació i Jurisprudència de Catalunya for example, where she joined efforts with her very good friend Encarna Roca Trias.

Home, for Alegría, was Barcelona,  no matter how often her international work took her away from them. Her family was her greatest pride and her unconditional top priority. A loving wife, mother and grandmother and an example to so many of us who juggle balls in all these roles…

And the University of Barcelona was not only her academic home but also our meeting point. The private international community has lost a great scholar and a formidable person. Alegría, we thoroughly miss you and thank you so much for all you did for us and so many other alumni of yours. Together, we will persevere in our efforts the way you taught us. Rest in peace.

 

 

 

 

 

An e-mail has been sent to those who registered for the second EAPIL Virtual Seminar, on Digital Teaching and Private International Law, scheduled to take place on 27 January 2021 from 5 to 7 p.m. (MET), with the details to join the seminar, via Zoom.

If you have registered, and don’t see our e-mail in your inbox, please check the spam folder.

For further queries, please refer to Susanne Gössl at sgoessl@law.uni-kiel.de.

On Tuesday, February 2, 2021, the Hamburg Max Planck Institute will host its eight monthly virtual workshop in private international law at 11:00-12:30. Since January of this year, we are alternating between English and German language. Dagmar Coester-Waltjen will speak, in German, about the topic “Von der Staatsangehörigkeits-Anknüpfung zur Berufung der lex loci celebrationis im internationalen Eheschließungs- und Partnerschaftsrecht?” (“From Nationality to Lex Loci in Private International Law of Marriage and Civil Union?” The presentation will be followed by open discussion. All are welcome. More information and sign-up here. This is the eight such lecture in the series, after those by Mathias Lehmann in June, Eva-Maria Kieninger in July, Giesela Rühl in September, Anatol Dutta in October, Susanne Gössl in November, Marc-Philippe Weller in December, and Macjiej Szpunar in January. In February, we will again have an English language event – stay tuned! If you want to be invited to these events in the future, please write to veranstaltungen@mpipriv.de

For the first time since the entry into force of the 1968 Brussels Convention and the EU Regulations in the field of judicial cooperation in civil matters, the Greek Supreme Court was called recently to examine an application for recognition and enforcement of an English order awarding alimony to a wife, while at the same time regulating property issues between the spouses.

On 12 June 2020, the Supreme Court [Nr. 662/2020] ordered the reversal of the appellate judgment [Athens Court of Appeal 4789/2018, unreported], which in turn had rejected the husband’s appeal against the first instance decision granting the recognition and declaration of enforceability of the English order [Athens court of 1st Instance 420/2015, unreported].

The Ruling of the Supreme Court

The case at hand concerned an order of the Family Division of the High Court, which was issued upon the request of the wife in the course of divorce proceedings. In particular, the wife requested that she retain the ownership of the family house in London, and that she be granted the amount of ₤ 600.000 as a capitalised maintenance payment, plus 100% of the interests from a Merchant Investors assurance program, whereas the husband would retain the ownership of eight parcels of land in Greece.

The English court granted the request. The judge ruled as follows:

I consider that the wife’s need could be met by an even distribution of the assets listed in the KT list [i.e. the list prepared by the wife’s lawyer] and I therefore intend to issue a financial provision order in the form of a lump sum of 600,000 ₤ payable to the wife…  I am satisfied that the order I issue achieves the purpose of a fair distribution of assets between the parties.

The order to pay the lump sum raised an interesting issue of characterisation with far reaching consequences. It could either be regarded as a maintenance payment, or as distribution of the assets of the spouses, and thus related to their matrimonial property regime.

One of the consequences of the distinction is that separate legal regimes govern the enforcement of maintenance and matrimonial property judgments. Two different regulations apply: either the Maintenance Regulation, which provides for immediate enforcement (abolition of exequatur: Articles 17 et seq.), or the Matrimonial Property Regulation which has retained the ‘traditional’ requirement of a declaration of enforceability (Articles 36 et seq.). In this case, the application was filed prior to the entry into force of both regulations, but separate regimes already applied to each category. The Brussels I Regulation applied to maintenance, resulting in the simplified procedure of articles 38 et seq. Matrimonial property fell outside of the EU framework, and was thus governed by the common law of foreign judgments of the Member States (in Greece, Articles 323 & 905 of the Code of Civil Procedure), i.e. a more conservative regime, which, in addition to the international jurisdiction barrier (Article 323 No. 2), has a different starting point, as it is not bound by the famous principle of mutual trust and free movement of judicial decisions between EU Member States.

The Greek Supreme Court made the following characterisation:

The award of this lump sum does not have a supportive purpose; it does not seek to meet the basic needs of the applicant, so as to be considered a maintenance claim, but has a rather redistributive-compensatory purpose, leading to the distribution of assets between the spouses, as expressly stated in the reasoning of the foreign order.

In view of the above, the Supreme Court ruled that the dispute fell outside the scope of the Brussels I Regulation, pursuant to the exception under article 1 (2) (a) [rights in property arising out of a matrimonial relationship]. It allowed the appeal, and referred the case for retrial to the appellate court.

The Supreme court cited in support of its decision three judgments of the European Court of Justice, C-143/78, De Cavel, C-25/81, C.H.W. and C- 220/95, van den Boogaard. In van den Boogaard, the ECJ ruled:

a decision rendered in divorce proceedings ordering payment of a lump sum and transfer of ownership in certain property by one party to his or her former spouse must be regarded as relating to maintenance and therefore as falling within the scope of the Brussels Convention if its purpose is to ensure the former spouse’s maintenance.

Courts and scholars in other Member States have already  pointed out that the van den Boogaard ruling did not resolve the issue entirely, granting a margin of discretion to national judges.

Comparative Overview

A search of similar situations and their treatment by national courts of other Member States leads us to a ruling of the German Supreme Court from 2009 [BGH 12.08.2009, NJW-RR 2010, pp. 1 f = IPRax 2011, pp. 187 f]. Confronted with similar facts, the Bundesgerichtshof opted for a solution akin to the Judgment of Solomon: departing from the characterization of the case, it accentuated the dual function of the provision [Doppelfunktionalität der Vorschrift], and granted the request for recognition and declaration of enforceability of the part demonstrating qualitative features of a maintenance claim. Respectively, for the remaining part of the order, it proceeded in the fashion chosen by the Greek Supreme Court.

On the other hand, English scholarship tends to include similar cases under the category of maintenance claims, drawing an additional argument from Annexes I-IV of Reg. 4/2009, while at the same time taking into account the case law of the CJEU, and the possibility of separation, as opted by the German Supreme Court.

In a recent decision, the Swiss Court of Cassation overturned a decision which ruled that the Lugano Convention did not apply to an English Financial Remedy Order, and referred the case to the Zurich Supreme Court for resolving the crucial issue of distinction between maintenance and matrimonial property disputes. A comment on the ruling is available here

The Impact of the Ruling

The withdrawal of the United Kingdom from the EU does not undermine the importance of the Greek Supreme Court ruling for the future. The intentions of the English legislator are not yet revealed. As  is already widely known, a primary indication does not exist, given that the field of judicial cooperation in civil and commercial matters has been left outside the Agreement. The expected accession of the UK to the Lugano Convention has been recorded ad calendas Graecas. However, a specific instrument will continue to govern the enforcement of maintenance judgments. The Convention of 23 November 2007 on the International Recovery of Child Support and Other Forms of Family Maintenance will substitute EU law in the relations between the UK and Greece. A change of course by the Greek Supreme Court is highly unlikely, however, and financial provision orders will be subject to domestic rules of recognition and enforcement.

It should also be underscored that the issue is not unique to the United Kingdom. Similar systems are to be found in the legislation of other Member States [e.g. the Republic of Ireland, and partly France]. Therefore, fresh applications are not to be ruled out. Prospective applicants are however advised to prepare the file more diligently: English orders are issued on the basis of a judgment. It is therefore considered necessary to produce a translated true copy of the foreign judgment, so that the judge is able to understand the peculiarities of the foreign system, and to decide upon having seen the whole picture in advance.

The Universidad de Valencia is organizing a seminar entitled “nuevos desafíos y oportunidades de los derechos del menor en asuntos transfronterizos”, to be held on 28 January 2021 online (in Spanish / and Portuguese in one panel). The Conflictus Legum blog published information about this seminar here.

This seminar is held in the context of “Minor’s Right to Information in civil actions (MiRI) – Improving children’s right to information in cross-border civil cases”, a Project co-funded by the European Union Justice Programme 2014-2020, JUST-JCOO-AG-2018, under Grant Agreement No 831608.

Among the speakers are: Cristina González Beilfuss, Andrés Rodríguez Benot, Mónica Herranz Ballesteros, Isabel Reig Fabado, Elena Rodríguez Pineau, Mercedes Soto Moya, María Carmen Chéliz Inglés, Idoia Otaegi Aizpurua, David Carrizo Aguado, etc.

The Council Regulation (EU) 2019/1111 of 25 June 2019 on jurisdiction, the recognition and enforcement of decisions in matrimonial matters and the matters of parental responsibility, and on international child abduction (Regulation Brussels II ter) will be discussed throughout the day (but particularly in panel #1).

Participation is free of charge (and there is no need to register). The link to the seminar is here.

In Top Optimized Technologies SL (A Company Incorporated Under the Laws of Spain) & Anor v Vodafone Group Services Ltd & Ors [2021] EWHC 46 (Pat) Smith J is asked to stay proceedings on the basis of Article 30 Brussels Ia’s related actions rule.

Three sets of proceedings are pending: one in Madrid; two in the UK. Parties, even some of them are of similar corporate blood, are not the same. Hence an Article 29 lis alibi pendens application is not possible. Arguments advanced at 39 ff in favour of a stay, are in the main, the same facts and matters being traversed (with an immediate indication of Smith J that the applicable law being different counts against, there being a ‘danger in overstating the overlap’); the danger of relitigating earlier proceedings elsewhere, and of consequential double recovery.

Smith J at 40 ff is in favour of what he calls the ‘wide approach’ to A30 (unlike a more narrow approach under A29 and incidentally under A45), to which I can subscribe. At 45 he sums up his reasons for declining the stay which of course are largely discretionary. However, among them is one oddity: at 45(4):

Moreover, this is a case where Vodafone has avoided – entirely properly – the jurisdiction of the Spanish courts by invoking the exclusive jurisdiction clauses in favour of England and Wales. Vodafone could have submitted to the jurisdiction of the Spanish courts under Article 26, but instead elected to invoke Article 25. As a result, proceedings involving all relevant parties (Vodafone and Huawei) and so eliminating any risk of irreconcilable judgments have not been possible. No criticism can be made of Vodafone in this: but, conversely, it seems to me perverse now to prevent the progression of the Second UK Proceedings in circumstances where the fragmentation of the originally constituted Madrid Proceedings against Huawei and Vodafone has occurred at Vodafone’s insistence. (emphasis in the original)

This echoes the findings of Lord Briggs in Vedanta, that the potential for submission carries a lot of weight in ultimate jurisdictional decisions. I am not convinced Brussels Ia supports this.

Geert.

European Private International Law, 3rd ed. 2021, Heading 2.2.15.2 (para 2.521 ff)

 

Application for a stay under A30 BIa dismissed, with oddly reference ia to the fact that Vodafone could have avoided the risk of irreconcilable judgments had it foregone its choice of court privilege and seized the Spanish courts for its own proceedings. https://t.co/T4XSzTk14J

— Geert Van Calster (@GAVClaw) January 14, 2021

Private International Law in Poland has been recently released by Wolters Kluwer. The monograph is written by Ewa Kamarad and Anna Wysocka-Bar (one of this blog’s editors), both affiliated with Jagiellonian University (Poland).

The e-version of the monograph forms part of the International Encyclopaedia of Laws, the volume on Private International Law edited by Bea Verschraegen, available online (for subscribers, for example via Peace Palace Library e-resources).

Private international law rules in Poland are unified at the EU level to a great extent. However, this unification leaves certain areas to domestic PIL or international agreements, including numerous bilateral ones in force in Poland (for example, law applicable to rights in rem or recognition and enforcement of judgements coming from outside the EU). Additionally, certain areas are unified in the EU within the enhanced cooperation mechanism which means that not all EU Member States apply them (for example, law applicable to divorce, jurisdiction, applicable law, as well as recognition and enforcement of EU judgements in matrimonial property matters). Poland is an example of a Member State, which is not participating in this cooperation and continues to apply its own rules. Due to the above the book might be of interest to international public, academics and practitioners, as it constitutes a general sketch of the whole system of PIL in Poland.

A succinct post on yesterday’s reports that the French courts are now properly engaging with the action brought in France by more than a dozen US-based corporations (and one local, French defendant) on the continuing impact of the use of Agent Orange by the US Army in Vietnam. Thank you Taco van der Valk for pointing me to an earlier interlocutory judgment which identifies defendants.

Claimant is a dual French-Vietnamese citisen. Jurisdiction is based on Article 4 BIa against the one French defendant. Anchor jurisdiction with that defendant in play, reinforces the jurisdiction based on claimant’s French nationality (the infamous, often labelled ‘exorbitant’ jurisdictional rule of Article 14 of the Code Civil; on which see here). Claimant’s domicile in France presumably is an additional reinforcing factor.

Geert.

European Private International Law, 3rd ed. 2021, para 2.139.