EAPIL blog

On 25 May 2020, the CJEU has resumed its activity. This means hearings will be held again. None is scheduled for June on PIL matters, though.

The decision of the third Chamber (Prechal, Rossi, Malenovský, Biltgen, Wahl) in C-41/19, FX, is expected for 4 June.

The case arises from a request for a preliminary ruling made by the Amtsgericht Köln. It is about a child resident in Poland, who had obtained a decision from the Polish courts establishing the maintenance obligations of her father, resident in Germany. After getting a declaration of the enforceability of the Polish maintenance decision in Germany, the maintenance creditor seeks to have that decision enforced there. The debtor opposes enforcement on the basis that his payment obligations have been largely fulfilled; to this aim, he has lodged an application opposing before the German courts. The key issue raised by the request for a preliminary ruling is whether the German courts have jurisdiction to rule on that application on the basis of Regulation (EC) No 4/2009 on jurisdiction, applicable law, recognition and enforcement of decisions and cooperation in matters relating to maintenance obligations. AG Bobek’s Opinion was published on 27 February 2020. He suggests the CJEU answer in the following terms:

Council Regulation (EC) No 4/2009 of 18 December 2008 on jurisdiction, applicable law, recognition and enforcement of decisions and cooperation in matters relating to maintenance obligations, and, in particular, Article 41(1) thereof, should be interpreted as meaning that the courts of the Member State where the enforcement of a maintenance decision given in another Member State is sought have jurisdiction to adjudicate on an application opposing enforcement, in so far as it is intrinsically connected with enforcement proceedings, it does not seek the modification or review of the maintenance decision, and it is based on grounds that could not have been raised before the court that issued the maintenance decision. Those conditions appear to be fulfilled by the application of opposition to enforcement based on the discharge of the debt at issue in the present case, which is nonetheless ultimately for the referring court to verify.

A separate post will appear on this blog concerning the Court’s judgment.

Additionally, two Opinions will be delivered on 18 June 2020, one by AG Szpunar (C-433/19, Ellmes Property Services) and the other by AG Campos Sánchez-Bordona (C-540/19, WV).

The former addresses a request from the Austrian Oberster Gerichtshof on the first subparagraph of Article 24(1) of the Brussels I bis Regulation. The OG asks whether the provision is to be interpreted as meaning that “actions brought by a co-owner seeking to prohibit another co-owner from carrying out changes to his property subject to co-ownership, in particular to its designated use, arbitrarily and without the consent of the other co-owners, concern the assertion of a right in rem”. Should the question be answered in the negative, the CJUE should determine Article 7(1)(a) whether concern contractual obligations to be performed at the location of the property.

In C-540/19, the German Bundesgerichthof requests the CJEU to decide whether a public body which has provided a maintenance creditor with social assistance benefits in accordance with provisions of public law can invoke the place of jurisdiction at the place of habitual residence of the maintenance creditor under Article 3(b) of the Maintenance Regulation, in the case where it asserts the maintenance creditor’s maintenance claim under civil law, transferred to it on the basis of the granting of social assistance by way of statutory subrogation, against the maintenance debtor by way of recourse. A good occasion to review C-433/01.

Finally, I would also like to mention AG Hogan’s Opinion on C-454/19, Staatsanwaltschaft Heilbronn, delivered the 4 June 2020. At first sight the questions referred to the Court had little to do with PIL:

(a) Is primary and/or secondary European law, in particular Directive 2004/38/EC of the European Parliament and of the Council, in the sense of a full right of EU citizens to move and reside freely within the territory of the Member States, to be interpreted as meaning that it also covers national criminal provisions?
(b) If the question is answered in the affirmative: does the interpretation of primary and/or secondary European law preclude the application of a national criminal provision which penalises the retention of a child from his guardian abroad where the provision does not differentiate between Member States of the European Union and third countries?

This notwithstanding, Regulation 2201/2003 on jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility (Brussels II bis) and the case law of the Court relating thereto are very much present in the Opinion.

The Diesel scandal has produced a wave of litigation word-wide. We are still waiting for the CJEU’s decision on whether claims can be brought in Austria by Austrian purchasers (Case C-343/19). The Advocate General’s opinion in this case has been the subject of an earlier post on this blog.

One of the important issues in the case pending before the CJEU is whether claimants can be expected to sue Volkswagen (VW) at its seat.  VW has its seat in Wolfsburg; thus, the competent court for such claims would be the Regional Court (Landgericht) of Braunschweig (Brunswick). The Braunschweig Regional Court has, however, now introduced a new hurdle for claimants who want to sue VW at its seat.

The Court at VW’s Seat Has Spoken

On 30 April 2020, the Regional Court of Braunschweig gave judgment (docket no 11 O 3092/19) on a case concerning a German debt collection company that had brought a “collective action” based on a number of claims against VW assigned to it by Swiss purchasers who bought cars fitted with the illicit software. The debt collection company was licensed under the German Act on Out-of-Court Legal Services (Rechtsdienstleistungsgesetz – RDG).

The Regional Court dismissed the action on the basis that the company could not dispose of the authorisation necessary under the RDG to pursue the claim, despite being licensed in Germany. It specifically found that neither the company nor its employees had any knowledge of Swiss law. Such expertise was however indispensable for the present case because the Regional Court of Braunschweig assumed that the claims assigned to the company would be governed by Swiss law.

An Overly Simplistic Conflict-of-Laws Analysis

The Regional Court derived the applicability of Swiss law from Article 4(1) of the Rome II Regulation. The court concluded that the place where the damage occurred, which is decisive under this rule, was Switzerland because the purchasers had paid for the cars from Swiss bank accounts.

The Regional Court seems to refer in this respect to the CJEU judgment in Kolassa, which – in the context of international jurisdiction – had considered the place where a bank account is managed as relevant for the localisation of financial loss. However, this judgment concerned the specific situation of prospectus liability, not the sale of cars. It cannot be considered as establishing a general rule, as the CJEU has clarified in its later judgment in Universal Music.

The localisation of loss in the ‘Dieselgate’ cases is much more difficult and intricate, as the Advocate General has pointed out in its conclusions in Case C-343/19. The fact that the cars have been paid from Swiss bank accounts alone will not suffice to establish the applicability of Swiss law. Other circumstances will have to be considered, such as the place of domicile of the purchasers, or the place where they use their cars (see the comment on the AG’s conclusions here).

An Undue Restriction of Access to Justice 

More problematic still is that the Regional Court Braunschweig denied the debt collection company standing to sue VW in Germany on the grounds that it lacks sufficient knowledge of Swiss law. This argument relies on a very restrictive interpretation of German law, which requires debt collection companies to have only general legal expertise; not specific expertise in foreign law. Moreover, the ruling ignores the fact that debt collection companies may instruct experts on Swiss law to advise on certain points of the legal case. Indeed, the court will probably have to do the same were it to try the case, because it also lacks the necessary knowledge of Swiss law (see sec. 293 of the German Code of Civil Procedure).

The judgment raises an unacceptable barrier for the enforcement of foreign claims against VW in Germany. Victims whose claims are based on foreign law cannot use German debt collection companies to advance their claims, as the latter have been found not have the required expertise in foreign law. But they also cannot go via foreign debt collection companies, as these do not have the necessary German license and can only provide “temporarily and occasionally” legal services in this country (sec. 15 German Act on Out-of-Court Legal Services). To instruct a German lawyer will be too burdensome as the purchaser would have to shoulder the litigation risk of losing the case.

It is Now Up to the CJEU

The Regional Court of Braunschweig has set up an additional obstacle for foreign claims in the Diesel scandal. This makes it much more difficult to sue VW at its seat. It is hard not to form the impression that the Regional Court was looking for an efficient way to rid itself of an unattractive case. The case illustrates the difficulties foreign claimants face when bringing an action at VW’s seat. Hopefully, the CJEU will take note of this when it decides whether car purchasers may bring actions against VW abroad.

Christopher Marsden (University of Sussex) has posted Transnational Internet Law on SSRN.

The greatest, and certainly to a Westphalian nation-state-centered universe most revolutionary, challenge for regulation is the increasing co-operation between national, regional and international networks of regulators, to regulate the Internet. Reidenberg coined the term ‘lex informatica’ to explain its transnational legal nature, based on Berman and Kaufman’s analysis of mediaeval lex mercatoria, rather than Jessup’s transnational law. In Part 2, I briefly consider the technical standards that permit Inter-networking and thus the Internet. Part 3 examines how standards – including commercial and legal standards – have created a transnational lex informatica. In Parts 4-5, I focus on two phenomena of the transnational Internet law evolution. The first is governance by contract for all commercial transactions, even those that are ostensibly free of monetary value, in which the contractors are trading private information for advertising revenue. The second is the ‘open Internet’, laws protecting some aspects of network neutrality.

The paper is forthcoming in Peer Zumbansen (ed.), Oxford Handbook of Transnational Law (OUP 2020). It can be downloaded here.

The author of this post is Nadia Rusinova, Lecturer in International/European Private Law at The Hague University of Applied Sciences. This is the sixth in a series of posts aimed to explore the impact of the coronavirus crisis on the phenomena of mobility and exchange that form the constituent elements of private international law, and to discuss the responses that private international law rules provide to the challenges posed by the crisis itself (see the previous contributions by Giovanni Chiapponi, Matthias Lehmann, Tomaso Ferando, Caterina Benini and Aygun Mammadzada). The EAPIL blog welcomes further contributions on such topics, either in the form of comments to the published posts or in the form of guest posts. Those interested in proposing a guest post for publication are encouraged to contact the blog’s editorial team at blog@eapil.org.

Despite the obvious need for extraordinary measures during the pandemic, the restrictions we face as a response to the threat posed by the COVID-19 engage a number of rights, protected under the ECHR (hereinafter, the Convention). Individuals are entitled to fundamental rights protection even – and especially – in case of an emergency. In this sense, we already ask ourselves: are the adopted measures proportionate and targeted, are they required by the exigencies of the situation, are they not inconsistent with other obligations under international law? Do we need new approaches to respond to this unprecedented situation?

The importance of private international law for family issues in an era of globalization is immense and the topic acquires particular significance due to the increasing mobility and internationalization of the child and of the family. The private international law aspects of international child and family law in the context of international child abduction, intercountry adoption, cross-border surrogacy, cross-border relocation, etc. are frequently dealt with in many cross-border cases and these rapid developments must result in the development of uniform guidelines.

Some of the most important are found in the recently published COVID-19 Toolkit of the Hague Conference on Private International Law, also announced in this blog.

With international borders closed and containment measures in place, cross-border movement of people and goods is subject to unprecedented restrictions. In many jurisdictions, children and families remain stranded. Access to government services remains limited. Legal procedures have been delayed or suspended. Without doubt the future judgments and decisions of European Court of Human Rights (hereinafter, the Court) in this context will have an impact on the main issues of private international law, including the recognition and enforcement of foreign judgments.

This post focuses on the potential impact of the COVID-19 measures on the assessment of Article 8 violations in its family life aspect. As this is a complex question, this post explores an issue of how the State responses can be seen as an interference in the family life and whether the States ensured adequate regard for Article 8 rights in the context of the pandemic. In particular, concrete example of how domestic courts apply the imposed measures in handling remote family law proceedings is discussed, and the compliance of these approaches with the requirements of the Convention is analyzed.

In the present abnormal circumstances, the fundamental principles of substantive law remain unchanged. Therefore, the procedural aspect of Article 8 is in the center of this post as closely linked to the rights and interests protected by Article 6 of the Convention.

Background

The legal aspects of a pandemic of this magnitude is still terra incognita for the domestic courts and understandably, for the Court as well. The only judgment so far, which concerns the impact of influenza quarantine seen as an interference in the family life related to a parent-child contact is Kuimov v Russia (2009).

In this case foster homes’ management refused the father to exercise his rights of access to his child on the ground that an influenza quarantine had been introduced, however the applicant could speak to the child on the telephone during this time. After the quarantine in the foster home was lifted, the father could resume his face-to-face meetings with his child.

In its assessment the Court found that the restrictions on the father’s access to the child were imposed with the “legitimate aim of protecting child’s health and rights”. Moreover, the Court accepted the Governments’ explanation that the access to the foster home was restricted due to a quarantine, which did not last an unreasonably long time – around 7 weeks. In addition, the father was allowed to come and see the child through the glass window on a weekly basis. In the circumstances of the case and regard being had to the States’ margin of appreciation, the Court was of the view that there was no violation of Article 8 on account of the restrictions imposed by the authorities on the applicant’s access to the child, in respect of the period of the quarantine.

Current Context

In response to the COVID-19 pandemic, already mid-March it became clear that measures should be taken, and taken fast, by the States in order to protect individual human rights. Further steps need to be taken in the next days, weeks and months, may be even years; we will experience the consequences for long time ahead. The impact of these measures will be widely felt, and some groups will be affected more than others. All in all, these measures entail the broadest mass restriction of liberties our generation have ever seen.

The rights protected by Article 8 of the Convention make no exception. On the contrary – family life and particularly parent-child relationships suffer to a high extent from the rollercoaster we found ourselves in. As a consequence, the domestic courts are called upon to assess, elaborate and reflect on this situation for years ahead. Naturally, this is the rationale behind the multiple derogations to Article 8. Therefore, even adequately taken in order to respond to the threat posed by COVID-19, these measures will have certain implications on the future assessment of Article 8 violations by the Court as well.

This would be completely new perspective when determining what would constitute a breach of Article 8 in the aforementioned context. The Corona crisis places also the question how is the vulnerability of the children needs to be regarded in the current pandemic. The Court will be asked to adjust to this new setting its child-specific human rights approach, developed with the years, taking into consideration three interrelated concepts: the inherent vulnerability of children, the best interests of the child and the circumscribed children’s autonomy which gradually increases with their evolving maturity (see, among others, M. and M. v Croatia, § 171).

The Court has found that the notion of “family life” under Article 8 of the Convention encompasses de facto “family” ties. The existence or non-existence of “family life” for the purposes of Article 8 is essentially a question of fact depending on the existence of close personal ties. The interferences in parent-child relationships could impact not only the “classical” parental responsibility disputes and child abductions, but foster care and adoption cases as well.

As to the derogations from obligations under the Convention, the Council of Europe acknowledges in the document titled Respecting democracy, rule of law and human rights in the framework of the COVID-19 sanitary crisis: A Toolkit for Member States that the measures taken by the States vary depending upon the specific situation in the States concerned.

The large margin of appreciation of States as regards the existence of emergency and of the required measures is unavoidable. As suggested by Kanstantsin Dzehtsiarou, the magnitude of this crisis will clearly translate into significant margin of appreciation allowed to the authorities. This in turn means that the Court will apply looser test of proportionality and if the measures go beyond what is necessary under this loose test of proportionality, then violations are possible.

Potential violations of Article 8 have already been voiced in domestic court proceedings over the last few weeks. The Court will likely be asked to deal with similar allegations in the future. It is of course uncertain how the Court will look at these allegations and whether the current crisis will affect the interpretation of the Convention. The Kuimov case, a quarantine with a duration of 7 weeks and a limited local impact can hardly compare to the current global pandemic. Thus, the roles and perspectives of different stakeholders in child law in the private international law sphere at international level (parents – mothers and fathers, judges, the children themselves, other relatives, etc.) need to be reconsidered to respond adequately to this new situation.

States’ responses and domestic courts procedural actions – interference in the family life

If we try to foresee how the future case-law will look, the first question is what can be considered as “interference” in the current situation. The primary purpose of Article 8 is to protect against arbitrary interferences with private and family life, home, and correspondence by a public authority (Libert v France, §§ 40-42). This obligation is of a negative kind, described by the Court as the essential object of Article 8 (Kroon and Others v the Netherlands, § 31). However, Contracting States also have positive obligations to ensure that Article 8 rights are respected including as between private parties (Evans v the United Kingdom [GC], § 75).

In this sense, interference in times of Corona, related to the right of family life under Article 8 are clearly present. Firstly, the application of the general, mainly procedural rules, adopted by the state’s authorities in emergency response to the COVID-19, and secondly, to give example of particular application of these responses – the various approaches taken by courts in determining how to deal remotely with the specific case in the context of the pandemic.

States Emergency Responses

Shortly after the seriousness of the situation became clear, many States responded to the threat posed by the COVID-19 by setting the rule that decisions regarding parental responsibility still apply, with the caution that the exercise of parental rights and right of access has to be respected in the health context. Due to the pandemic, courts are mostly closed and, generally, the only applications that can be reviewed in family matters are international child abduction cases, urgent claims to obtain a restraining order in cases of domestic violence and, in some cases, provisional and protective measures. As to pending and future cases – for instance parental disputes that are not yet introduced to the court but still might be urgent, the hearings that were originally set during the “lockdown period” have generally been cancelled or postponed. Lodging new applications is possible, but they are not immediately entertained.

As an example of the emergency measures adopted in some States, a state of health emergency was declared in France for two months from 24 March 2020 until 24 May 2020. During the lockdown, the courts have been dealing only with international child abduction cases and urgent applications for restraining order in cases of domestic violence. In Spain, precautionary measures under Article 158 of the Spanish Civil Code are available at this time only in urgent cases. Deadlines remain suspended until further notice, but since 15 April 2020, it has been permissible to file new applications with the court. In Italy the suspension has some exceptions, namely in the field of family law matters and protection of vulnerable people:
some Juvenile Tribunal procedures take place, like adoption procedures, foreign children without parents procedures, children brought away from their families, and situations of heavy risk for the child; surprisingly the same procedures in front of the Court of Appeal are not explicitly exempted from suspension.

The Approaches of Domestic Courts

In sum, Europe-wide, the message from the governments is that existing judgments on custody and access must be maintained, except where there is a concrete risk to the child’s health because of one of the parents’ behavior or living environment, which may give an opening to a modification. The difficulty arises from the fact that assessment of all particular claims is far not realistic having in mind the dimensions of the pandemic and the limited resources of the courts to react at this moment.

However, the courts soon recognized that regardless the danger of potential contamination, blanket policy that children should follow their usual visitation regimes is inconsistent with a comprehensive analysis of the best interests of the child. Therefore, the presumption is that existing parenting arrangements and schedules should continue, but subject to whatever modifications may be necessary to ensure that all COVID-19 precautions are adhered to, including strict social distancing.

This approach reflected into recent court decisions, concerning the rights protected by Article 8. The health, safety and well-being of children and families remains the courts’ foremost consideration during COVID-19. In many cases, a parent’s personal risk factors (through employment or associations, for example) required controls with respect to their direct contact with a child. A parent’s lifestyle or behavior in the face of COVID-19 (for example, failing to comply with social distancing; or failing to take reasonable health-precautions) raised sufficient concerns about parental judgment that direct parent-child contact would have to be reconsidered.

Compliance of the interference with the requirements of Article 8

Turning to the question how these interferences are to be assessed in the light of the Convention, we should note that like most Convention rights, Article 8 is not absolute. Article 8(2) enumerates the legitimate aims which may justify proportionate interference by a public authority and potential infringement upon the rights protected in Article 8.

At least three of these justifications in the aforementioned context can well be related with the Corona crisis: public safety, protection of the health, and protection of the rights and freedoms of others. In the present situation the purpose of the measures is clearly to limit the spread of the Coronavirus by imposing certain limitations, and it logically seems to constitute “legitimate aim”.

The Court is however quite succinct when it comes to assessing the existence of a legitimate aim within the meaning of Article 8(2) (S.A.S. v France [GC], § 114). Following the rule established in its case-law, in future cases it will be for the respondent Governments to demonstrate that the interference pursued a legitimate aim (Mozer v the Republic of Moldova and Russia [GC], § 194). They will need to show that the particular measure in question aimed at protection of public safety, health, and rights and freedoms of others, depending upon the specific situation in the particular country.

Moreover, the States concerned will need to argue the proportionality of these measures, which might be the greater challenge in this situation. As a principle, the restriction impacting upon fundamental rights is unlikely to be proportionate if a less restrictive method could have been used to achieve this legitimate aim. The concept of proportionality in times of pandemic puts great burden on the authorities, requiring them to strike a fair balance between the interests of the individual whose rights are being impinged upon, and the interests of others or of the community. When life is at stake, like now, that is a particularly difficult balance to strike. In the context of the current pandemic the question is: could these measures be less restrictive?

At this point it is almost impossible to determine the proportionality of the emergency responses, because we must primarily assess the legislative choices underlying it. In addition, the national authorities were forced to make initial assessment in days (if not hours), with all the wide margin of appreciation left to them. In this regard, the Court should give leeway to the Contracting States and their policy makers (see this post by Vassilis P. Tzevelekos at Strasbourg Observers for a discussion on this point).

To summarize whether the potential infringement upon Article 8 is necessary in a democratic society in these pandemic times, we should follow the approach of the Court and balance the interests of the State concerned against the rights of the individual.

In leading Article 8 case, the Court clarified that “necessary” does not have the flexibility of expressions as “useful”, “reasonable”, or “desirable” (which would be nowadays very convenient), but implies the existence of a “pressing social need” for the interference in question (Dudgeon v. the United Kingdom, § 51). In this context, we should note that if such measures are in principle regarded and announced as a temporary, amended frequently according to the developments and are discontinued as soon as circumstances permit, in pandemic situation with this magnitude the pressing social need such measures to be imposed may be considered as present.

Speaking specifically of the discussed domestic courts’ approaches, of course, the substantial compliance with the Convention cannot be assessed altogether as it would always depend on the unique circumstances of the case. From procedural point of view, of particular interest is the question if the remote or hybrid hearing is sufficiently fair to meet the requirements of Articles 6 and 8 of the Convention. For instance, where lies the balance with the potential delay of the proceedings, in case the remote hearing is considered not suitable in the particular case?

Traditionally, in cases concerning a persons’ relationship with his or her child, there is a duty to exercise exceptional diligence, in view of the risk that the passage of time may result in a de facto determination of the matter (Ignaccolo-Zenide v Romania, § 102; Süß v Germany, § 100, Strömblad v Sweden, § 80) By its nature, a remote hearing, if appropriate at all, can replicate some but not all of the characteristics of a fully attended hearing. The parties should always stay alert to ensure that the dynamics and demands of the remote process do not impinge upon the fundamental principles. Remote hearings also place additional, and in some cases, considerable burdens on the participants – for instance, despite the right of translation is not absolute in the view if the Court, the language barrier appears as greater issue than in the traditional hearings, which in a cross-border context could be decisive.

How in this context to assess if the safeguards of Article 8 and Article 6 have been regarded? There is no straightforward answer, but in the present crisis the assumption must be that such a process is capable of being fair and meets the requirements of both provisions.

First of all, when assessing the suitability of the remote process, the courts must seek to ensure that it does not become overloaded by making distinction between those decisions that must be prioritized and those that must unfortunately wait until proper time is available. In some cases, even when it is much more difficult for the judge to watch the reactions of the parties to the evidence and although this is a general disadvantage of the remote hearing, it cannot be considered as major issue. Overall, the technology could be capable of providing a satisfactory hearing and the judge would understandably continue with remote proceeding, when the urgency is prioritized, even at the expense that at the end the usual basic procedural safeguards may have been in some way overlooked. Despite all this, it seems that this could not be assessed as a violation of Article 8 and 6 in cases when a child has been held in limbo for a long time.

Naturally, the suitability of the remote hearing will be raised (among the other issues) as a complaint before the Court. In its case per case analysis the Court should assess it not only as a separate procedural issue, but also in its interplay with the whole emergency situation.

Different factors should be taken into account, such as whether each of the parties could engage sufficiently with the professional evidence to an adequate degree for the process to be regarded as fair, and whether each of the parties have been able to follow and to understand the court hearing and to instruct their lawyers adequately in a timely manner. Checking that the demands and dynamics of the remote hearing did not encroach upon the central principles of a fair proceedings is crucial.

In these cases it would be good practice already now the domestic courts to discuss it in their arguments, relating to the requirements posed by the Convention (see for a good example the ruling of the Family Court of England and Wales in Re S (a child), § 13). Some pandemic-specific caveats should also be considered, for instance the fact that the highly pressured circumstances in which all the participants are working could lead to a chain reaction in the course of which fundamental legal and procedural principles come to be compromised despite the best intentions of a range of dedicated professionals.

As a conclusion, last months and weeks turned upside down the world as we know it. Governments tried to keep human rights and fundamental freedoms at the heart of measures to combat the pandemic, yet forced to take various emergency actions. At this point we can only guess whether these measures comply with the requirements of the Convention. Now, as the outbreak of COVID-19 slows down, it is probably a good moment to see if human rights are not forgotten in such uncertain times – there is still time to exercise more attentive monitoring of the level of protection and to make better choices.

At its fifty-second session, in 2019, UNCITRAL considered a proposal from the European Union on applicable law in insolvency proceedings (A_CN.9_995_E).

UNCITRAL agreed on the importance of the topic, which complemented the significant work already done by UNCITRAL in the area of insolvency law, in particular cross-border insolvency.

However, UNCITRAL also observed that the subject matter was potentially complex and required a high level of expertise in various subjects of private international law, as well as on choice of law in areas such as contract law, property law, corporate law, securities and banking and other areas on which it had not worked recently. Therefore, UNCITRAL agreed that it was essential to delineate carefully the scope and nature of the work that it could undertake.

UNCITRAL requested the Secretariat to organize a colloquium, in cooperation with other relevant international organizations, with a view to submitting concrete proposals for UNCITRAL’s possible future work on such topic, for consideration by the Commission at its fifty-third session, in 2020. The Colloquium is to be conducted on an informal basis, that is, not as an intergovernmental group.

The Colloquium was to be held in New York on 15 May 2020 (see the draft programme here), in cooperation with the Hague Conference on Private International Law.

Due to the postponement of the Working Group V session originally scheduled for 11-14 May 2020, the Colloquium on Applicable Law in Insolvency Proceedings is also postponed. Information on the new date will be communicated by the UNCITRAL Secretariat when possible.

The author of this post is Aygun Mammadzada, PhD Researcher at the Institute of Maritime Law of the University of Southampton.

Status quo

Withdrawal of the United Kingdom from the European Union leaves many uncertainties and puzzling effects on civil justice and cross-border judicial cooperation. Upon its departure on 31 January 2020 the United Kingdom ceased to be a member of the Union while remaining subject to the EU law and rulings of the European Court of Justice throughout the transition period under Article 67 of the Withdrawal Agreement. In less than five weeks – by 1 July 2020, the United Kingdom and European Union should decide whether to extend the transition period up to two years, as permitted by the Agreement. However, that has been ruled out by the United Kingdom, which could be altered by another legislation and it seems hardly a case.

Once the transition period ends, the Brussels I bis Regulation will no longer be applicable to jurisdiction, as well as choice of court agreements and the recognition of judgments between the United Kingdom and the Union.

Absent such an instrument, successful operation of the sphere will mostly depend on either Article 33-34 of the Recast Regulation which are not comprehensive enough or domestic rules which prevent uniformity and certainty due to inevitable varieties. This will significantly affect businesses and individuals. Data suggested that in 2018 the UK was the largest legal services market in Europe (valued at approximately £35 bn in 2018).

On the same line, 75% of over 800 claims which were issued at the Admiralty and Commercial Court involved at least one foreign party and in 53% of the case all parties were international. In 2019, 77% of over 600 such claims were international in nature whilst in half of the cases all parties were international. On the same note, despite the fact that the Member States are taking different measures, such as establishing special commercial courts to attract international commercial parties, there is still not any alternative to the London Commercial Court as a leading global centre for international dispute resolution, as discussed by Giesela Rühl. Nonetheless, without any harmonized legal framework applicable to jurisdiction and the recognition of judgments in cross-border civil and commercial cases, parties to international trade might refrain from linking their transactions to English jurisdiction or avoid English choice of court agreements.

Among other measures, the UK has expressed that enhanced judicial cooperation with the EU is part of its global outlook and it will continue adherence to the existing international treaties, conventions and standards in the field. In this ambit, on 8 April 2020, the UK deposited its request for acceding the Lugano Convention of 2007 (see here a comment by Matthias Lehman).

The Convention is still applicable in regard to the UK during the transition period as part of the EU law. Unlike the Hague Convention on Choice of Court Agreements of 2005 which is also among the UK’s Brexit-related channels, the Lugano Convention is not an open treaty. According to Article 72 of the Convention, the UK can become a member only upon the unanimous consent of all of the contracting parties (EU and EFTA states). This brings many uncertainties about the foreseeable status of the UK’s accession request.

The Lugano Convention is mainly mirroring the Brussels regime and therefore, it might enshrine perspectives of cross-border judicial cooperation in civil and commercial matters between the UK and Union. The government perceives the importance of the Convention for the provision of judicial certainty and prevention of multiple court proceedings. Nevertheless, the Convention does not contain new lis pendens provisions that were brought by the Brussels I bis Regulation, hence lacks the same degree of respect to party autonomy and choice of court agreements as ensured by the revised Regulation.

Mastermelt Ltd v Siegfried Evionnaz SA: The relevance of the case

In the recent case of Mastermelt Ltd v Siegfried Evionnaz SA, the High Court decided that the Brussels I bis Regulation does not affect the interpretation of the Lugano Convention. Mr Justice Walksman concluded that unlike the new lis pendens provisions as contained in Article 31(2) of the Brussels I bis Regulation, the Lugano Convention preserves the “court first seized” rule and therefore, regardless of an exclusive jurisdiction agreement the court first seized shall continue the proceedings and rule on its jurisdiction.

This decision is very timely since it triggers nonequilibrium views on the foreseeable membership of the United Kingdom to the Convention. It confirms continuation of the Gasser scenarios and torpedo actions under the Lugano Convention, furthermore, gives rise to the risk of parallel proceedings and irreconcilable judgments.

Factual background

The dispute arose between Mastermelt Limited (Claimant), an English company, and Siegfried Evionnaz SA (Defendant), a Swiss company, over the quality of Mastermelt’s performance of the reclamation services in 2018.

After Siegfried informed Mastermelt about their intention to commence proceedings in Switzerland on the basis of the exclusive jurisdiction clause in favour the Swiss courts contained in Siegfried’s standard terms and conditions of contract (“STC”), the claimant initiated the English proceedings on 5 February 2019 seeking negative declaratory relief against the defendant. Later, on 23 July 2019, Siegfried instituted the Swiss proceedings in the Zurich Commercial Court against Mastermelt and subsequently, on 24 May 2019, applied the English High Court, for a declaration that it had no jurisdiction.

Mastermelt brought another set of Swiss proceedings for a stay in early 2020, which was rejected by the Zurich Commercial Court on 13 February 2020 and advanced to the Federal Supreme Court. As of the date of the hearing in the English High Court, the Supreme Court had not given any ruling on that.

Issues

The English court considered whether the harmonised version of Article 27 of the Lugano Convention applies and if so, it would have had stayed the proceedings until the Swiss court had decided the question of jurisdiction. Subsequently, the court also decided the question of its own jurisdiction and validity of the exclusive jurisdiction agreement.

Analysis

While considering the proper interpretation of Article 27 of the Lugano Convention the court as a primary point conferred that it was not bound by the Swiss court’s decision on the same issue which was relied upon by Siegfried.

Referring to Protocol No 2 to the Lugano Convention, Mr Justice Walksman paid ‘due account’ to the Swiss judgment, however, refused its binding effect. Drawing on the ‘too remote’ nature of the former to be characterized as res judicata, the judge opposed to the defendant’s contention to apply the CJEU’s decision in Gothaer v Samskip. On this line, the High Court resisted the harmonised interpretation of Article 27 of the Lugano Convention as Article 31(2) of the Brussels I bis Regulation and as the first seized court denied staying the proceedings.

Contrary to the defendant’s reasoning, the court determined that although the CJEU’s decision in Gasser was reversed by the new Article 31(2), it was not obsolete and still had limited application outside the Regulation. The court reiterated its conclusion by emphasizing the significance of academic discussion. As stated by Professor Briggs, “the innovation created by 31.2 … does not apply to proceedings within the scope of Lugano II which remains regulated by the original rule of strict temporal priority …”. Professor Joseph also took a similar approach by expressing that “… there is no equivalent provision in the … Convention to Article 31.2 … Therefore, as regards the enforcement of jurisdiction agreements, the court first seized will examine the enforcement of such an agreement, irrespective of whether it is the chosen court…”

These brought continuation of the proceedings and examination of the second issue – jurisdiction of the court first seized. Pursuant to the Convention, if there was an exclusive jurisdiction agreement in the ambit of Article 23 of the Lugano Convention the English court had to dismiss the proceedings in favour of the designated court, otherwise Siegfried’s claim had to be litigated in England as the place of performance according to Article 5.1(a).

Referring to a significant body of the European and English case law (including the CJEU’s rulings in Salotti v Ruwa, Berghoefer v ASA SA, Iveco v Van Hool, Benincasa v Dentalkit and the judgment o the Court Appeal in Deutsche Bank v Asia Pacific), Mr Justice Walksman regarded the existence of an agreement as an independent concept. The court highlighted the reasoning in Powell Duffryn and Aeroflot and stated that a valid agreement should be “clearly and precisely” demonstrated either in a form of “writing” or ‘evidenced in writing’. Moreover, it was asserted that the written form could be evidenced not only in a single document but it could consist of multiple documents such as the seller’s quotation and buyer’s purchase order.

While considering what constituted “writing”, Mr Justice Walksman articulated the tendency of the courts to adopt a flexible approach as in the CJEU’s judgment in Berghoefer and his own earlier decision in R + V Versicherung v Robertson which in turn referred to the decision of the Court of Appeal in 7E Communications v Vertex.

At the same time, he emphasized the importance of the valid agreement in the sense of consent in line with the opinion of the Advocate General Bot in Profit Investment. On this basis it was submitted that an oral agreement of the party to the other party’s STC which included an exclusive jurisdiction agreement would not be sufficient to meet the durability requirement without later written evidence of such putative consent. This view was also supported by academic commentaries and English authorities such as ME Tankers v Abu Dhabi Container Lines [2002] 2 Lloyds 643, Claxton Engineering v TXM [2007] 1WR 2175, Chester Hall v Service Centres [2014] EWHC 2529.

The court admitted that there was a written agreement and manifested consent between the parties on the basis of the purchase orders and STC, which were strongly compelled by prior dealings, later statements and invoices expressly found in the email exchange. It was also maintained that there was “much the better of the argument” satisfying the good arguable case standard for the applicability of Article 23.1(a) and any opposing presumption would be “commercially absurd”.

Upon these observations, Mr Justice Walksman held that the English proceedings had to be dismissed in favour of the exclusively designated Swiss court.

Comments

This decision is of importance for several reasons. It reaffirms the emphasis that has been traditionally placed on party autonomy and authentic consent in English law and practice.  Likewise, it reasserts the exhaustive interpretation of the form requirement of the exclusive jurisdiction agreements within the meaning of the Lugano Convention which might be a useful reference point for the courts post-Brexit provided the UK would have become a member to the framework.

On the other hand, the judgment is particularly sensible at the time of the United Kingdom’s Brexit planning and strategy to continue the Lugano membership. It reveals serious differences between the Brussels I bis Regulation and Convention notwithstanding the equivalent rules existing in both.

Contrary to the remarks favoring the Convention as an “oven ready” option for the United Kingdom, the lack of a mechanism preventing parallel proceedings and irreconcilable judgments frustrates legal certainty, provokes waste of time and expenses, thus, threatens the vital principle of private international law – party autonomy.

Articles 5 and 6 of the Hague Convention on Choice of Court Agreements which enforce parties’ choice and oblige any non-chosen court to stay or dismiss the proceedings, might be helpful in this regard, however only to some limited extent due to its limited scope and application only to the Contracting States, whereas the EFTA states have not ratified the treaty.

In this regard, return of anti-suit injunctions as the measures frequently issued by the English courts in support of exclusive jurisdiction agreements provokes special attention. Indeed, the lack of mutual trust within the Lugano framework might result in the reversal of the West Tankers ruling, however the matter is still uncertain since there has not been any relevant authority for such an implication. All the mentioned points raise considerable doubts over the satisfactory replacement of the Brussels I bis Regulation by the Convention for the post-Brexit UK.

Moreover, unusual obligation to “pay due account” to the case law of other contracting states, as well as the CJEU provided by Protocol No 2 to the Convention broadens skepticism. As indicated by Professor Hess, such language “… does not mean more than looking at the pertinent case-law and giving reasons as to why a deviation is considered to be necessary”. Furthermore, the absence of any sanction upon deviations brings “inherent weakness” of the Protocol and rests its application perspectives solely on “… goodwill and of courtesy of the courts …”.

All these lead to non-uniformity and harbours suspicion against the Convention as a successful post-Brexit means of the UK. These concerns leave further room for discussion about seeking robust solutions and especially reaching a bilateral agreement in this context as advised by Professor Hess. However crucial these items are, they are the subject matter of another study.

All in all, provided the United Kingdom becomes a Contracting State to the Lugano Convention, the Mastermelt ruling alerts the parties to be more careful and get appropriate legal advice while contracting and designating a competent forum for the resolution of their disputes.

The second issue of the Journal du droit international for 2020 is out. It contains one article concerned with private international law and several casenotes.

The article is authored by Djoleen Moya and discusses whether EU choice of law rules allocate normative powers or serve private interests (Conflits intra-européens de lois et conflits de souverainetés). The English abstract reads:

For the past 70 years or so, choice-of-law rules have been considered as rules of private law, dealing primarily with the interests of private persons involved in international situations. This conception, however, is now disputed. According to a growing number of scholars, the solutions deriving from EU law on matters of conflicts of laws would tend to allocate normative powers between Member States and circumscribe their respective legislative sovereignties. In this respect, the Europeanisation of private international law would have reinvented the problem of choice-of-law in terms of conflicts between States, rather than between private persons. On reflection, though, the necessary conditions to consider choice-of-law rules as allocating legislative powers are not met. In particular, the legal regime of choice-of-law rules in EU law looks pretty incompatible with any representation of conflicts of laws as conflicts of sovereignties.

A full table of content of the issue can be accessed here.

In a recently reported ruling (No 423/2018, in Chronicles of Private Law, 2019, p. 204), the Greek Supreme Court (Άρειος Πάγος) addressed the thorny issues of choice of forum and choice of law agreements relating to agency and distribution. The judgment basically follows the path paved by the CJEU. However, its analysis is noteworthy, allowing hopes for a shift in the established course of action.

The Facts

A Dutch company entered into a distribution agreement with a Greek company in 2004, followed by an agency agreement in 2007. The agreements included a choice of forum clause granting exclusive jurisdiction to the courts of Amsterdam and a clause stating that the contracts were governed by Dutch law. The Dutch principal terminated the agreements in 2009.

The Greek company started litigation in Athens. The defendant challenged the jurisdiction of the Greek courts on the basis of the choice of court clause. Both first and second instance Greek courts found they lacked jurisdiction.

The Grounds of Appeal

The claimant filed a (final) appeal before the Supreme Court, arguing that the choice of forum clause was abusive, and contrary as such to public policy. The Greek company submitted, among other things, that it had no real negotiating power with the principal, and that the choice of law clause resulted in the circumvention of Greek mandatory provisions.

The Ruling

The Supreme Court confirmed the lower courts’ finding and dismissed the case for want of jurisdiction. The forum selection clause, the Court noted, was agreed upon as a result of sound negotiations, with no abuse on the part of the Dutch company. A draft of the agreement had been previously submitted to the claimant, who had sufficient time to reflect and did not raise any objections or reservations.

The Supreme Court emphasized that the Greek company had a high turnover and significant profits. Its representatives, the Court noted, were familiar with travelling abroad for discussions and negotiations; hence, any difficulty and increased costs associated with the exclusive jurisdiction of Dutch courts did not make litigation before the latter courts impossible or unreasonably burdensome.

The combined choice of Dutch courts and Dutch law, the Court added, did not affect the validity of the choice of forum clause. A circumvention of Greek mandatory law provisions was not established. No abuse of the principal’s position was evidenced. In any case, Dutch law could not be regarded as completely alien to the case, given that the principal is in fact based in the Netherlands.

The Supreme Court finally approved the Athens Court of Appeal decision not to turn to the choice of law clause for the purposes of assessing the validity of the choice of forum agreement. It relied for this on the ruling of the CJEU in Trasporti Castelletti, where the Court of Justice stated that “the national court seised should be able readily to decide whether it has jurisdiction on the basis of the rules of the [Brussels] Convention [of 1968, the predecessor of the Brussels I bis Regulation], without having to consider the substance of the case”, adding that the “substantive rules of liability applicable in the chosen court must not affect the validity of the jurisdiction clause”.

Comment

In a nutshell, the show must go on. In spite of the scepticism voiced in legal scholarship, the foundations of the CJEU ruling in Trasporti Castelletti are too hard to shake, let alone demolish.

Still, the Supreme Court did not refuse to examine the public policy defence raised by the agency, and in fact accepted to discuss the issue of the abusive character of the clause. One may not agree with the result; however the sheer fact that the court dared the step, raises ambitions for a further scrutiny in future cases.

I finish with a suggestion for further reading: Many esteemed colleagues have published notes on the above and subsequent rulings of the Court which followed suit. One of the most recent articles dealing extensively with the issue was authored by Matthias Weller, whose analysis gave me ample food for thought [Matthias Weller, Choice of court agreements under Brussels Ia and under the Hague convention: coherences and clashes, Journal of Private International Law, 2007, 13:1, 91-129, in particular pp. 107-109].

Maud Minois (University Paris Descartes) has published earlier this year a monograph presenting her Research on Characterization in the Private International Law of Obligations (Recherche sur la qualification en droit international privé des obligations).

The author has provided the following English abstract:

Characterization is traditionally presented as a tool used to ensure legal certainty and rationality of law. We observe, however, that this is not necessarily the case in the context of private international law. For a long time, the lex fori characterization has dominated the international scene, so that it may appear as the most suitable model of qualification. But it does reveal certain shortcomings when applied to contract and tort law. The diversification of sources of the law as well as the rise of autonomous characterizations established by the Court of Justice of the European Union add further complexity to the picture. An efficient model for characterization is needed to restore coherence in private international law. In order to elaborate such a model, two axes of study must be explored successively. First, the model must suit the specificities of private international relations. Second, once proof has been offered for the thesis that autonomous characterization best answers this demand, the question of its generalization should be addressed. It appears that an efficient use of the autonomous qualifications can be made not only at the level of European private international law, but on the contrary, can be extended to private international law of conventional as well as of national sources. On the other hand, this model, as it specifically applies to private international relations has no place in substantive law.

More details are available here, including free access to the table of contents and the introduction of the book.

The German Federal Court (Bundesgerichtshof) rendered an important ruling on jurisdiction and applicable law in claims against internet portals publishing crowd-sourced reviews about businesses on 14 January 2020 (BGH VI ZR 497/18).

Facts

Yelp Ireland Ltd., a company incorporated under Irish law, offers a well-known website and application (“app”) providing businesses recommendations. Yelp uses an algorithm to determine how reviews are arranged, distinguishing between “Recommended reviews” and “Currently not recommended reviews.”  When calculating the rating (“stars”) of a business, only “recommended reviews” are taken into account.

Yelp was sued by the owner of a German fitness studio, who complained that this mode of calculation had created a distorted picture of its business because a number of older, more favourable reviews had been ignored. The claim was brought before a German court at the place of business of the claimant.

The Easy Part: Jurisdiction

The issue of jurisdiction was rather straight-forward. The Federal Court had to decide whether the claimant had suffered damage in Germany and could therefore bring the claim under Article 7(2) of the Brussels I bis Regulation.

Tthe Federal Court started by clarifying that Art. 7(2) Brussel Ibis Regulation also covers violations of personal rights and actions for injunctive relief. Insofar, it referred to the CJEU decision in Bolagsupplysningen, which had held that “a legal person claiming that its personality rights have been infringed by the publication of incorrect information concerning it on the internet and by a failure to remove comments relating to that person can bring an action for rectification of that information, removal of those comments and compensation in respect of all the damage sustained before the courts of the Member State in which its centre of interests is located” (CJEU, Bolagsupplysningen, margin no 44).

The Federal Court applied this standard and ruled that the claimant had its centre of interests in Germany where it carries out the main part of its economic activities. It thus found that it had international jurisdiction over the claim.

The Hard Nut: Applicable Law

Much more arduous was determining the applicable law under Article 4(1) of the Rome II Regulation. This is also the most interesting part of the decision.

The source of the problem is Article 1(2)(g) of the Regulation, which excludes “non-contractual obligations arising out of violations of privacy and rights relating to personality, including defamation” from the scope of the Regulation. It was doubtful whether the business in the present case had claimed such a violation. If it had, the Rome II Regulation would be inapplicable and German Private International Law would govern. The latter uses a different general conflict rule to the Regulation, giving tort victims in all cases a choice between the law of the place of tortious conduct and the place of damage (Art 40(1) Introductory Code to the German Civil Code – Einführungsgesetz zum Bürgerlichen Gesetzbuch (EGBGB)).

The Non-Decision

Whether companies can be victims of “violations of privacy and rights relating to personality, including defamation” in the sense of the Rome II exclusion is subject to debate in the literature (see e.g. Andrew Dickinson, The Rome II Regulation, OUP 2008, margin no 3.227; Anatol Dutta, IPRax 2014, p. 33, 37). The German Federal Court avoids this point by a “trick”: It deems the submissions made by the claimant as conclusive evidence of an implicit choice of German law. Thus, it would not matter whether the Rome II Regulation applies or not. In both cases, German law would be applicable, either as a result of Article 4(1) of the Rome II or of Article 40(1) of the EGBGB.

Assessment

Although the decision of the Federal Court provided clarity in the individual case, it did not answer the fundamental question of the scope of the exclusion under Article 1(2)(g) of the Rome II Regulation. In this respect, it is agreed that Article 1(2)(g) of the Regulation must be interpreted autonomously. It therefore does not matter whether national law grants companies personality rights or not.

The wording of Article 1(2)(g) does not differentiate between violations against natural or legal persons. The very term “legal person” and the concept of “legal personality” suggests that corporations may have “personality rights” in the sense of the provision. The decision in Bolagsupplysningen also points in this direction, though it concerned international jurisdiction and not the applicable law.

From a systematic viewpoint, however, the existence of Article 6(1) of the Rome II Regulation means that negative statements made in a commercial context must fall into the Regulation’s scope, as they make out a large part of unfair competition claims. Thus, they cannot be excluded under Article 1(2)(g) of the Regulation, regardless of whether they are brought against a legal or a natural person.

Historically, the exclusion under Article 1(2)(g) can be explained by conflicting views on the implications of the freedom of the press and other media and the freedom of expression for private international law. The Member States could not agree whether to use a connecting factor favouring the publisher’s freedom or the victim’s protection. For this reason, they decided to exclude the violation of personality and privacy rights from the provision’s scope altogether.

This background points to the need of careful construction of Article 1(2)(g) of the Rome II Regulation; the exclusion it contains must not be understood too widely.  An overly broad interpretation would also run against the effectiveness of the harmonised rules.

The proper decision would have been to apply the Rome II Regulation to negative online reviews of legal or other persons’ commercial activities. They should be seen as falling squarely in its scope. This also includes the question of how business ratings are calculated. It is unfortunate that the German Federal Court missed this opportunity for clarification.

Fernando Gascón Inchausti (Complutense University of Madrid) and Burkhard Hess (MPI Luxembourg) have edited The Future of the European Law of Civil Procedure, a book published by Intersentia.

The publisher’s blurb reads:

The European lawmaker is currently overseeing what appears to be a paradigm shift in the way that cross-border litigation is conducted within the European Union. This matter was initially conceptualised from the perspective of international judicial cooperation, based on the notion of mutual trust and mutual recognition. Recent developments, however, have introduced the option of harmonisation as a new regulatory approach.

The first part of the book is focused on the possible methodological approaches at hand. Special emphasis is placed on the role of the Court of Justice of the European Union as a “promoter” of a European Procedural Law (principle of effectiveness and principle of equivalence). The second part assesses to what extend harmonisation is already used: “vertically”, through the regulations on international judicial cooperation, for example the European Account Preservation Order; and “horizontally”, through the promotion of harmonised standards promoted by the directives on intellectual property rights and competition damages (access to information and evidence), or in the directive on trade secrets and in the field of data protection (protection of confidential information). With a view to the future, the final part examines two more recent initiatives: ELI-UNIDROIT and the proposal for a directive on common minimum standards of civil procedure in the EU.

The Future of the European Law of Civil Procedure: Coordination or Harmonisation? clearly outlines the motivations of the various national and institutional players in the regulation of civil procedural law and identifies potential obstacles likely to be encountered along the way that will be useful for every lawyer in the field.

The authors include Dominik Düsterhaus (Court of Justice of the European Union), Stefan Huber (University of Tübingen), Christoph A. Kern (University of Heidelberg), Stephanie Law (MPI Luxembourg), Patricia Llopis Nadal (University of Valencia), Janek T. Nowak (MPI Luxembourg), Marta Requejo Isidro (MPI Luxembourg), Vincent Richard (MPI Luxembourg), Elisabetta Silvestri (University of Pavia), Michael Stürner (University of Konstanz), María Luisa Villamarín López (Complutense University of Madrid), Enrique Vallines García (MPI Luxembourg).

See here for more information, including the table of contents.

William S. Dodge has posted Jurisdiction, State Immunity, and Judgments in the Restatement (Fourth) of US Foreign Relation Law on SSRN. The paper features in the latest issue (vol. 19, issue 1) of the Chinese Journal of International Law.

The abstract reads:

In 2018, the American Law Institute published the Restatement (Fourth) of Foreign Relations Law, which restates the law of the United States governing jurisdiction, state immunity, and judgments. These issues arise with great frequency in international cases brought in US courts, including cases involving Chinese parties. This article provides an overview of many of the key provisions of the Restatement (Fourth). The article describes the Restatement (Fourth)’s treatment of the customary international law of jurisdiction, as well the rules of US domestic law based on international comity that US courts apply when deciding international cases.

In response to the COVID-19 pandemic and following a video message of the Secretary General, the Permanent Bureau (PB) of the Hague Conference on Private International Law has developed a COVID-19 Toolkit.

The COVID-19 Toolkit spots situations covered by Hague instruments on which the pandemia may have a particular impact, and compiles references to specific HCCH resources and publications thereto relevant in light of the current global situation. It is designed to assist users of the HCCH Conventions and other instruments in these challenging times and beyond.

The HCCH COVID-19 Toolkit is divided into two main categories: International Child Protection and Family Matters, covering, inter alia, child abduction, family maintenance and intercountry adoption, and International Legal Cooperation, Litigation and Dispute Resolution, concerning, among other things, service of documents and the taking of evidence abroad.

Within each category, a short description is made on the presumable effect of the pandemia, followed by a quick access to the most pertinent instruments or guides connected, such as the Guide to good practice on the “grave risk exception” to prompt return under Article 13(1)(b) of the 1980 Child Abduction Convention.

The PB has expressed its hope that “the Toolkit will continue to encourage the effective operation of the HCCH instruments, ultimately ensuring better access to justice for individuals, families and companies across the globe, as well as facilitating cross-border trade, investment and dispute resolution, even in these uncertain times”.

It is indeed a worthy initiative with a helpful, user-friendly outcome (which, when it comes to putting legal rules into practice, is more than welcome).

The most recent issue of the Revue Critique de Droit International Privé is out. It contains three articles and numerous case notes.

In the first article, Roxana Banu (Western Law, Canada) discusses the scholarship of J. Jitta  (L’idéalisme pragmatique de Josephus Jitta (1854-1925)).

 Jitta occupied a very specific intellectual space between universalism and particularism and between state-centric and individualistic theoretical perspectives. His scholarship formed a different, quite radical alternative to the dominant private international law theory and methodology of his time. He rejected the conventional understanding of Savigny’s method of localizing transnational legal matters, fundamentally contested the premise that one could choose a law in disregard of its content, and refused to center private international law’s theory on the concept of state sovereignty. Yet his initially radical ideas evolved in a more pragmatic direction on contact with the great socio-political transformations following the First World War. This progression of his thought provides us with much to learn, while calling at the same time for a critical approach.

In the second article, Vincent Heuzé (University of Paris I) challenges the soundness of the doctrine of overriding mandatory provisions and argues that it is illogical and useless (Un avatar du pragmatisme juridique : la théorie des lois de police).

Pragmatism, as a legal theory, revolves around the refusal “to let itself be enclosed” in any given “system”. Such theory refutes giving in to a model of logical thinking. The triumph of legal pragmatism is best illustrated in private international law by the theory of the overriding mandatory provisions. The latter concept –to the extent its outcome was held as a genuine method– in fact only served as to legitimate a pragmatic legal vision. Indeed, such legal pragmatism theory is necessarily false, not to say useless, to that extent that it is incapable of upholding the solutions she inspired.

Finally, in the third article, Ilaria Pretelli (Swiss Institute of Comparative Law) explores some of the consequences of the Feniks case of the CJEU (case C-337/17).

Four CJEU judgements have up to now clarified the applicability of the Uniform European jurisdiction rules – the Brussels I system – to the modern versions of actio pauliana: the two Reichert cases (cases C-115/88 and C-261/90) had said what the pauliana is not; the recent obiter dictum in Reitbauer (case C-722/17) and, more substantially, Feniks (case C-337/17) have said what it is. In essence, the CJEU confirms that actio pauliana is a claim related to a contract with the consequence that the defendant may be sued both at his domicile – under art. 4-1 Brussels I a – and, alternatively, at the forum of the “obligation in question” – – under art. 7-1 Brussels I a. These two decisions have been discussed and mainly criticized by legal scholars (see for instance these posts here and here). who have voiced the inherent dangers of accepting the risk for the defendant of being attracted in an unpredictable forum. The 2018 decision on Feniks has seemed to open the path to an even greater uncertainty since, of the two contractual relations giving the cause of action to the claimant, the CJEU seem to have given relevance to the one between the creditor and the debtor, thus a relation to which the defendant is formally excluded.

The need to scrutinise the substantial – instead of the purely formal – relation between the defendant and the claimant is at the core of an analysis of Feniks appeared in the first issue of this year’s Revue critique de droit international privé. The circumstances of the case show in an unequivocal manner how involved the defendant appeared to be in the tactical sale operated by the debtor. In this respect, the Spanish forum of the domicile of the defendant might have well created complications suitable for the fraud against the creditor to succeed. The particular structure of the pauliana, constructed to unmask apparently legitimate operations, justifies a departure from a strict and formal interpretation of “predictability”.

The first consequence drawn by the author of the comment concerns the potential comprehensiveness of the alternative fora described in art. 7 Brussels Ia.

The author sees no reasons to discriminate claimants because of the subject of their claim. If an alternative is given in most of civil and commercial matters, why shouldn’t it be given to one or two of these. What is essential, and what the CJEU constantly underlines, is the existence of a narrow connection between the claim and the forum. In Feniks, many elements testified of the narrowness of the connection (the identity of the parties, the language of their pacts etc.).

The second topic of the comment addresses the core problem of trilateral situations that arise from two distinct legal (bilateral) relations: the difficulty of choosing ex ante the “obligation in question” for the effects of art. 7-1 Brussels I a.

As the majority of scholars has rightly pointed out, whenever the defendant is in good faith, it is absolutely unfair to give to the claimant the possibility of suing him or her in front of an unpredictable judge, such as the judge of the unperformed contract to which the defendant has never been part.

Since the pauliana consists in the reaction to a fraudulent, albeit apparently legitimate, contract, its transposition in private international law commands to avoid an aprioristical choice and suggests to give to the judge in question the power to decide which “obligation in question” needs to be taken into account in order to avoid, on the one hand, to manipulate the system in order to uphold the fraud and, on the other hand, that the defendant is sued in a forum for him truly unpredictable.

This solution promotes “good faith” to a connecting factor in line with the existing series of content-oriented and result-selective conflicts rules.

In sum, despite the laconicism of the decisions and the understandable reticence of scholars to accept them, Feniks and Reitbauer have eventually opened the right path for a uniform European jurisdictional rule for the national versions of actio pauliana.

The full table of contents is available here.

Jayne Holliday has written Clawback Law in the Context of Succession. The book is part of the Studies in Private International Law series published by Hart Publishing.

The blurb reads:

This book offers a global solution for determining the law applicable to a claim to clawback an inter vivos gift from a third party within the context of a succession. The book aims to identify an appropriate and applicable legal framework which supports legal certainty for cross-border estate planning and protects the legitimate expectations of the relevant parties. This is an area of private international law that has yet to be handled satisfactorily – as can be seen by the inadequate treatment of clawback from third parties in the 1989 Hague Convention on the Law Applicable to Succession to the Estates of Deceased Persons, and the 2012 EU Succession Regulation.

More information here.

In accordance with its goal to be a pan-European forum for reflection on issues of private international law, the European Association of Private International Law is seeking to establish working groups which will reflect on selected topics of private international law and submit their conclusions for endorsement by the Association.

EAPIL Working Groups might be constituted to reflect on any topic of private international law, whether broad or specific, theoretical or practical. The goal of Working Groups is to publish their conclusions in a document which could take various forms (reports, draft legislation, principles, recommendations, position papers, etc.).

All EAPIL members are entitled either to join any established Working Group, or to follow the work of the Working Group by joining its Members Consultative Committee.

Finally, the Association invites all members to propose the constitution of Working Groups on any topic of interest. More information on the procedure for establishing Working Groups can be found here.

Project on the Feasibility of a European Private International Law Act

The first Working Group established by EAPIL will refect on the feasibility of a European PIL Act and is chaired by Professor T. Kadner Gaziano. A full description of the project is available on the Group’s page.

Other Contemplated Working Groups

The establishment of several other working groups is currently contemplated. Proposals will be submitted for approval to the Scientific Committee once an appropriate number of members has expressed interest to join them. Any interested member is invited to contact the responsible person for the relevant group.

Project on a future European Regulation on International Property Law

So far, International Property Law has not been a subject matter in the ongoing process of Europeanisation of Private International Law through Regulations. This does not mean that the European legislator has not yet touched property law. The Regulations on matrimonial property and on succession have certain overlaps with international property law which the CJEU is in the process of clarifying (see e.g. the famous Kubicka case). Rights in rem also play a role for the rules on exclusive jurisdiction (Article 24 nr. 1 Brussels I bis Regulation). Furthermore, numerous directives, especially in the realm of finance law, use the lex rei sitae as a connecting factor.

This fragmented picture and the fact that Member States’ autonomous rules on international property law are by far not uniform although most, if not all, still use the lex rei sitae principle as a starting point, call for a European Regulation on the law applicable to proprietary rights. The project is meant to be limited to tangible movable and immovable property, leaving out rights in intangibles (claims, intellectual property rights) and securities whether incorporated or unincorporated.

The group is still under formation. EAPIL Members who like to join it are invited to signal their interest to Prof. Dr. Eva-Maria Kieninger (Kieninger@jura.uni-wuerzburg.de).

Project on Interests in European Private International Law

The issue of interests is a topic of the highest practical importance, which is raised by the award of any sums of money. In cross-border relations, it is necessary to assess which law applies to them, whether at the adjudicatory stage when a court rules on a financial claim, or at the enforcement stage, when an enforcement authority is requested to enforce a foreign judgment. Yet, European Regulations of PIL are largely silent on the topic. The working group will aim at proposing either amendments to existing legislation or interpretations addressing these issues.

Members interested to join the working group or follow its work in the Members Consultative Committee are invited to contact Prof. Dr. Caroline Kleiner (caroline.kleiner@parisdescartres.fr).

Project on the Evidence Regulation

The Evidence Regulation is currently being recast. Unfortunately, the contemplated reform neglects the most important of its flaws, the need for liberalization of the cross-border taking of evidence in the European Union. The CJEU has underscored the backwardness of the Evidence Regulation by allowing courts of the Member States to ignore it and use directly their national procedures. The working group will aim at proposing a new ambitious framework liberalizing cross-border taking of evidence in the European Union.

Members interested to join the working group or follow its work in the Members Consultative Committee are invited to contact Prof. Dr. Gilles Cuniberti (gilles.cuniberti@uni.lu).

Gisela Rühl (Friedrich-Schiller-University Jena and Humboldt-University of Berlin) has posted Settlement of International Commercial Disputes Post-Brexit, or: United We Stand Taller on SSRN.

The abstract reads:

The European market for the settlement of international commercial disputes is currently dominated by London. According to official statistics, about 80% of the cases brought before the London Commercial Court involve at least one foreign party. And in about 50% of the cases both parties are foreign. Obviously, the London Commercial Court is a popular forum for the settlement of international commercial disputes. And, obviously, it has an international appeal that is – at least in Europe and at least thus far – second to none.The remaining EU Member States, however, are not sleeping. In fact, over the course of the last years the prospect of Brexit has induced some of them to take measures designed to make their civil justice systems more attractive for international commercial parties: Germany, for example, established two first instance, international commercial chambers at the Regional Courts in Frankfurt and Hamburg in 2018 which offer to conduct proceedings in English. France created an English language chambre internationale at the Paris Court of Appeal in March 2018 which complements and adds a second instance to the English language chamber at the Paris Commercial Court that has been operating since November 2010. The Netherlands inaugurated the English language Netherlands Commercial Court and the Netherlands Commercial Court of Appeal in January 2019. And other countries, notably Belgium and Switzerland are contemplating the establishment of one or more specialized courts to deal with international disputes. Quite clearly: the European market for international commercial litigation is on the move. And while some of the above mentioned chambers and courts were in the making before the UK decided to leave the EU in 2016, there can be little doubt that the prospect of Brexit has fuelled the development. The interesting question, however, is whether the recent trend to establish international commercial chambers and courts will actually yield any success? Will companies decide to come to the continent – rather than to London – to settle their disputes after Brexit? As a matter of principle, the odds are not too bad: After all the UK will lose its access to the European Judicial Area once Brexit becomes fully effective, namely when the transition period provided for in the Withdrawal Agreement expires. English court proceedings will then no longer benefit from the many European Regulations that ease the settlement of international disputes and judicial cooperation in cross-border civil matters. At least for companies which seek access to the European Judicial Area, Brexit will, therefore, make it less attractive to settle a dispute in London.The following chapter takes this observation as an occasion to explore the consequences of Brexit for the settlement of international commercial disputes in more detail. It argues that no court in the remaining Member State seems in a position to present itself as a serious alternative to the London Commercial Court. It is, therefore, suggested that the EU should step in and create a European Commercial Court. This Court would provide European companies with an international forum in the European Judicial Area after Brexit and would also attract disputes that would otherwise be settled before other international commercial courts or international arbitration tribunals.

The paper is forthcoming in Jörn Axel Kämmerer, Hans-Bernd Schäfer (eds), Brexit and the Law. An Interdisciplinary Study, Edward Elgar.

The European Parliament’s Legal Affairs Committee issued on 22 April 2020 a draft report with recommendations to the Commission on a Digital Services Act which, we believe, is of particular interest for private international law (PIL) specialists.

While the document mainly focuses on the approximation of Member States’ substantive laws in the field of digital services, it also includes interesting considerations on PIL.

Background 

In the context of its follow-up to the Digital Single Market (DSM) Strategy, the European Union’s main objective is to ensure the best possible access to the online world for Union citizens and businesses. It requires to adopt rules promoting free provision of digital services while, at the same time, safeguarding fair competition between economic operators and the highest standard of consumer protection as well as personal data protection. Numerous rules covering different aspects of digitalisation, including private-law issues (see for instance, Directive 2019/770 on B2C contracts for the supply of digital content and services and Regulation 2019/1150 on promoting fairness and transparency for business users of online intermediation services), have already been adopted.

A quick look at the DSM Strategy acquis shows that the EU legislator has so far followed a sectorial approach. The e-commerce directive, pioneer in its time to enhance the emerging digitalisation in the field of services, has not been updated since its adoption in 2000. The text creates a common legal framework to ensure the free movement of “information society services”, i.e. economic activities which take place on-line, between Member States. It lays down an “internal market clause” in favour of service providers (also known as country of origin principle), as well as rules on electronic contracts, commercial communications and limited liability of intermediaries.

Today, a majority of experts agree that the liberal regime established by the directive appears outdated in the context of new digital services providers, such as social networks, collaborative economy platforms or online marketplaces (see the Google France case and the Glawischnig-Piesczek case decided by the Court of Justice). The scope of application of the directive, which rests inter alia on the notion of “provider of information society services”, is also widely questioned (see Elite Taxi Case and Airbnb).

Against this backdrop, the European Commission announced the future adoption of a Digital Services Act (DSA) to update the current horizontal regulatory framework. The proposal aims at strengthening the responsibility of online platforms and clarifying rules for the provision of online services.

Private International Law Issues

The treatment of PIL issues within the DSM Strategy is, until now, at best marginal. The European legislator has not said much on cross-border regulation of private-law relationships within the DSM acquis. In most cases, the secondary law limits itself to laying down that it “should be without prejudice to Union law concerning judicial cooperation in civil matters” (see Regulation 2018/302 on addressing unjustified geo-blocking, Article 1(6); Regulation 2019/1150, Article 1(5); Directive 2019/770, Recital 80).

We see this as a major oversight as the digital world is international by nature. First, the implementation of EU PIL instruments in the digital area is far from obvious. PIL is traditionally based on geographical location and connecting factors but online relationships are intrinsically “aterritorial”. Reconsidering EU PIL acquis – without necessarily reviewing it extensively – is essential (see recently Pedro de Miguel Asensio, Conflict of Laws and the Internet, Edward Elgar, 2020, announced here). Second, a coordinated implementation of EU substantive rules and PIL instruments is, in most cases, a prerequisite for the efficiency of the former.

Against this backdrop, the European Parliament draft recommendations provide for a meaningful set of considerations.

European Parliament Draft Recommendations

While the European Commission’s proposal is only expected in the last semester of 2020, the European Parliament (EP) has already started working on the future Digital Services Act (DSA). The EP’s Legal Affairs Committee released  draft recommendations aiming at “adapting commercial and civil law rules for commercial entities operating online” (2020/2019 (INL)). By doing so, the EP wishes to influence the content of the future DSA proposal but also ancillary regulation.

The draft report addresses different issues related to PIL including: (i) the role of EU PIL in ensuring an effective access for Union citizens and businesses to justice, (ii) the status of access rights to data under PIL, and (iii) the coordination between the scope of the future European digital services set of rules and PIL.

Assessment (i) Access to justice and PIL

The EP proceeds from the fact that contracts concluded by individuals or businesses with online service providers are generally pre-formulated standard contracts, which include exclusive choice of law and forum provisions. This contractual imbalance is likely to affect access to European justice for the co-contracting party, in particular when the service provider is established in a third country. The EP’s position on this issue is welcomed and coherent with the EU fundamental right to an effective judicial remedy (EU Charter of fundamental rights, Article 47; see also for a recent application under the GDPR, Article 78(1) and (2), and Article 79(1)).

It remains to be seen what concrete measures can be promoted in this field. Would it require to create a European forum necessitatis in digital services litigation? Would local courts be allowed, under certain conditions, to remove a jurisdiction clause in favour of a third country “imposed” by a digital services provider. These questions have to be read in connection with the mandatory nature of the forthcoming regulation (see infra (iii)) and perhaps also with the debate on the (non-)validity of a choice-of-court agreement, which aims at circumventing overriding mandatory provisions (from a French perspective, see Cass. Civ. 1re, 22 october 2008, Monster Cable, n°07-15.823).

(ii) Access rights to data and PIL

The second issue deals with PIL implications in the context of cross-border flows of data, closely linked to the provision of digital services. The draft report focuses on access rights to data, probably by reference to Article 15 of the GDPR. The main objective of this provision is to help individuals to understand why and how an operator is using their data. As, most of the time, the processing of data, as well as their transfer, are cross-border, PIL must be implemented. However, it is not always clear which PIL rules, among EU and national set of rules, are applicable, depending on the characterisation of the legal relationship concerned (see on this blog, Martina Mantovani, “Contractual Obligations as a Tool for International Transfers of Personal Data”). Moreover, due to the room for manoeuvre given to Member States by the GDPR for specific processing situations, the European data protection regime may lead to divergent solutions pursuant national laws. This may be detrimental to European individuals and can lead to regulatory competition and law shopping.

Against this backdrop, the EP asks for “clarification” but what does it mean?  The next step should be to increase legal certainty in the designation of the competent jurisdiction as well as of the applicable law in data protection litigation. This requires to review the weaknesses of the GDPR in this respect and start thinking about clear uniform PIL rules in the field. It will be a full-part legislative work, next to the future DSA.

(iii) Geographical scope of EU digital services law and PIL

Regarding the scope of the forthcoming DSA, the EP underlines the “importance of ensuring that the use of digital services in the Union is fully governed by Union law under the jurisdiction of Union courts”. Reference is made here to the mandatory nature of EU secondary provisions vis-à-visthird countries’ law.

This position, supporting the efficiency of EU law, is consistent with the approach taken by the European Court of Justice in the well-known Ingmar case. A similar statement is laid down in secondary law, for instance in the field consumer protection, in order to ensure a mandatory application of EU substantive rules (see Directive 2011/83 on consumer rights, Article 25). The same approach is now followed in some DSM instruments. They “should apply irrespective of the law otherwise applicable to a contract” – by definition, the law of a third country – (see Regulation 2019/1150, Recital 9 in fine; Regulation 2017/1128 on cross-border portability of online content services, Article 7(2) and Recital 25).

By contrast, the e-commerce directive is limited to the European market and does not apply to service providers established in third countries. This is the direct consequence of the internal market clause (Article 3), which can only benefit to European economic operators. However, this geographical limitation is outdated; many digital services providers are now established outside of the EU.

The efficiency of EU DSM substantive law depends on its ability to encompass the global dimension of trade, in particular when it comes to protect European values such as fair competition or the protection of the weaker party. To this end, EU PIL is a key ally.

Catherine Kessedjian (Emeritus Paris II University) and Valérie Pironon (University of Nantes) have published the second edition of Catherine Kessedjian’s manual on international commercial law.

The authors have provided the following abstract in English:

The book aims at speaking not only to students, but also to practitioners and specialists in the field. Therefore, the authors have been careful at keeping a balance between basic information and some cutting edge developments in areas where the law is evolving fast.

First, the book addresses sources of the law and how applicable law is determined. It makes clear that international commercial activities are regulated at all levels (multilateral, regional and national) but also by a-national norms that have taken an ever increasing role in the field, thereby recognizing that Non-State actors do have a role in establishing norms for their own activities (and perhaps even further). As far as conflict-of-laws is concerned, the book starts with the study of mandatory norms because they are the ones that really matter in a field where party autonomy is the centerpiece. Any practitioner negotiating a deal needs to ascertain the extend of the freedom her client enjoys so that to craft the contract in the most efficient way.

The second part of the book is devoted to the actors of international commercial activities. Companies are the first and foremost actors in a world where the States have withdrawn from many fields. Now this was true before the covid-19 disease suddenly broke into our lives. States are now back and it will be for the third edition to appraise how much they will stay as the main player in the future. Two topics are covered when dealing with State activities: investment (when States are on the receiving hand) and immunity (when States as an actor ask for some sort of special treatment).

The third part deals with activities themselves and cover not only the access to markets but also some of the most classic international business activities (sales, distribution, transport). It also deals with the most common contract provisions (confidentiality, bona fide and cooperation, force majeure, CSR etc.) and takes into consideration trade practices. A section is also devoted to the guarantees put in place for the proper accomplishment of the activities.

The fourth part is devoted to dispute resolution. The first chapter is the most original. It gives a roadmap to negotiators as to how to choose the best dispute resolution mechanism for the contract. The rest is more classic and deals with mediation, arbitration and dispute before national courts (essentially French and European Law).

Finally it must be noted that emphasis is placed on contemporary debates such as globalization, electronic commerce, ecological challenges, CSR, transnational group actions, etc.) without avoiding the most controversial ones.

More details, including a full table of contents, can be found here.

The author of this post is Aygun Mammadzada, PhD Researcher at the Institute of Maritime Law of the University of Southampton. This is the fifth in a series of posts aimed to explore the impact of the coronavirus crisis on the phenomena of mobility and exchange that form the constituent elements of private international law, and to discuss the responses that private international law rules provide to the challenges posed by the crisis itself (see the previous contributions by Giovanni Chiapponi, Matthias Lehmann, Tomaso Ferando and Caterina Benini). The EAPIL blog welcomes further contributions on these topics, either in the form of comments to the published posts or in the form of guest posts. Those interested in proposing a guest post for publication are encouraged to contact the blog’s editorial team at blog@eapil.org.

Beyond triggering global health crisis, the extremely rapid growth of COVID-19 pandemic has exacerbated significant disruptions for global order, as well as brought drastic effects on international commerce and trade. Interruptions in business transactions have become inevitable due to challenges in meeting contractual obligations, terminations and reliance on frustration or force majeure clauses. All these have given rise to considerable cross-border disputes and necessitated reasonable case management strategies.

Like other states the UK government has also taken several steps for fighting the spread of coronavirus and among other legislative measures recently adopted the Coronavirus Act 2020. The Act justifies giving extraordinary powers to the government in a broad spectrum of areas including the work of the courts and tribunals for navigating uncertainties and minimising potential risks for the judiciary. In the light of substantial significance of access to fair trial and administration of justice amid increasing coronavirus-related claims this post focusses on the implications of the outbreak for civil proceedings. While English courts would maintain ongoing or potential cases parties should expect the recent changes in procedural law and adapt new practices regarding filing the documents and attending the hearings.

Emergency Legislative Measures

On 19 March 2020, Lord Chief Justice delivered a message to the Civil and Family Courts about continuation of their work as a vital public service with a particular note that this would not be ‘business as usual’.  Following the nationwide lockdown that was officially declared across the UK on 23 March 2020 the Coronavirus Bill received Royal Assent on 25 March 2020 and became a Parliamentary Act. The key provisions affecting judicial proceedings are laid down in Sections 53-57 on expansion of video and audio technology by criminal and magistrates’ courts and public participation in live civil as well as criminal proceedings. As the Department of Health and Social Care has addressed these measures aim at keeping the courts open to the public, continuation of the proceedings without the need for the participants to attend in person and refraining delays in the administration of justice.

On the same day the HMCTS published an operational summary on avoiding physical hearings and arranging remote trials wherever possible, introduction of social distancing measures in courts and tribunals upon continuation of the ongoing proceedings. Since then there has been a daily summary of HMCTS operational position provided during the pandemic. With the purpose of consolidating the work of courts and tribunals into fewer buildings since 30 March 2020 there have been priority courts and tribunal buildings open to the public for essential face-to-face hearings, some staffed courts without being open to the public and temporarily suspended courts. The work of the courts and tribunals has been prioritised and divided into categories.

To further promote the use of technology by judiciary several pandemic-related updates were made to the Civil Procedure Rules. Practice Direction 51Y promotes audio and video hearings and open justice. It differentiates private hearings which can be recorded and accessed only in a manner directed by the court and public trials which are accessible by public and media representatives. It further states that the Direction ceases to have effect on the date on which the Coronavirus Act 2020 ceases to have effect according to Section 75 of that Act. Indeed, Section 89 determines the expiry date as the end of the 2 years’ period beginning with the day on which it is passed provided no alteration is made in this regard. Expecting audio and video hearings will still remain part of the procedure post-pandemic similar rules should be provided.

Practice Directions 51Z and 51ZA related to stay of possession proceedings and extension of time limits have been inserted into the CPR. Aiming at delaying possession proceedings, PD 51Z provides that they are stayed for a period of 90 days from 27 March 2020. The rules will cease to apply on 30 October 2020 which might not be reasonable taking into account the start date of the stay and its duration. If the rules apply only to those possession proceedings that have already been brought under CPR Part 55 and seeking to enforce an order for possession, would it be reasonable to set the expiry date of the PD as 30 October 2020? Put differently would the rules cover those claims that are brought between 27 March 2020 and 30 October 2020? Presumably yes, in spite of the current text of the direction lacks a clear indication.

PD 51ZA on the other hand enables the parties to agree an extension up to 56 days without formally notifying the court (rather than the current 28 days). Given that it has been agreed by the court any extension of more than 56 days is also possible. Similar to PD 51Z this Direction also ceases to have effect on 30 October 2020. Even if the Coronavirus Act is still in force for the initially determined two years’ period any extension between 30 October 2020 and 25 March 2022 would not be permitted which might bring controversies.

It should be emphasized that remote hearings and use of technology at trial is not entirely novel. Long before the pandemic and emergency act, English judges have already had wide discretion to hold the hearings and receive evidence by phone or other means of direct oral communication in civil proceedings. Video conferencing and telephone hearings in civil proceedings were introduced by the Access to Justice Act 1999 on the basis of Lord Woolf’s report reviewing civil justice system and discretionary powers of the judges to provide flexible, effective, less costly and less time-consuming litigation. Section 3.1(2) of the CPR determines case management powers of the judges and relevant procedure for telephone hearings and video conferencing is presented in Sections 6 and 7 of Practice Direction 23. The CPR also contains judicial guidance on the use of video conferencing in the civil courts (Annex 3 to the Practice Direction 29.1, which was referred by Barling J in Haider v Syed [2013] EWHC 4079 (Ch)).

It is also worth to recall Practice Direction 51V here which has established “the Video Hearings Pilot Scheme” running between 2 March 2020 and 30 November 2020. Regardless of its limited application only to the procedure setting aside default judgments by the court via an internet-enabled video link (“a video hearing”), together with the outcomes of the recent changes and gained experience they can contribute building a solid basis and practice for future proceedings.

Thus, notwithstanding familiarity with the use of technology in civil proceedings prior to the pandemic and Coronavirus Act, it was applied only to partial extent in relation to the receipt of the evidence from witnesses abroad and in person hearings have been encouraged as a traditional mode of conduct. Upon a sudden reversal of the circumstances face-to-face hearings are neither safe nor practically possible which endorses fully remote hearings. In his message on 19 March, Lord Chief Justice delivered that the procedural rules have already enabled flexible use of the telephone and video hearings by the civil and family courts, however, there might still be legal impediments. Therefore, the HMCTS is expanding availability of diverse technological means including phones, video facilities and Skype. As of the latest updates, besides Skype, Cloud Video Platform (CVP) and BT MeetMe have started to be used in some civil and family hearings.

In response to the COVID-19, the English Commercial Court had its very first fully remote hearing in the case National Bank of Kazakhstan the Republic of Kazakhstan v The Bank of New York Mellon SA/NV London & Ors [2020] EWHC 916 (Comm) on 19 March 2020. The virtual trial involving participants and witnesses from different jurisdictions lasted for four days, publicly accessible livestreaming and daily transcripts were provided in line with the legislation. Mr Justice Teare confirmed that the default position is to avoid adjournments where it is possible and in this regard parties’ cooperation and flexibility are extremely valuable.

As stated, “The courts exist to resolve disputes and, as I noted this morning, the guidance given by the Lord Chief Justice is very clear. The default position now, in all jurisdictions, must be that hearings should be conducted with one, more than one, or all participants attending remotely…” Such a policy aims at prevention of uncertainties arising out of the cases adjourned together with the filed ones which would have been waiting for the trials and getting hardly manageable.

The same approach was followed by the High Court in the case Re One Blackfriars Ltd, Hyde v. Nygate [2020] EWHC 845(Ch) where Mr John Kimbell QC refused the application of the claimants to adjourn, instead ordered the parties to prepare for trial. As commented, “The message is that as many hearings as possible should continue and they should do so remotely as long as that can be done safely”.

Impacts on the Procedural Landscape

Advantages of technological development are evident owing to cost-effectiveness and time friendliness of the remote hearings.  It not only enables participation of the parties or witnesses who are not able to travel within or outside places of their residence but also avoids delays and unnecessary costs except those resulting from the use of technology.

Nevertheless, there are still many issues that might arise and become hurdles for the operation of the proceedings. One issue is related to the fact that not everybody would be able to apply software and cope with the technological means. Although different guidance notes on how to join telephone and video hearings have been provided this does not prevent issues arising from impossibility of using technology by some users due to their unawareness, incapacities or physical conditions. That necessitates sensitivity and presumably creativity for seeking further options. Mr Justice MacDonald highlighted the “Press Here Stupid” guidance as known in the IT circles and asserted that, besides the parties the judiciary also contains a cohort of judges who may not use the software or lack necessary equipment for the operation of a remote hearing.

The HMCTS has provided a local helpline for technical support to join an audio or video hearing. In this regard probably the SIAC or LMAA experience could also be applied and trainings of the remote technology specialists and staff could be designated.

Unpresented parties such as homeless, chaotic due to alcohol or drug use or having mental health issues may also have similar difficulties to attend proceedings remotely by video or telephone. Likewise, not all the participants might have suitable facilities, hard or software utilities.

Another issue arising out of the remote hearings is related to the potential risks for privacy of the parties, as well as judges. The Protocol dated to 20 March 2020 (slightly revised on 26 March 2020) regarding remote hearings considered the communication platforms as non-exhaustive which would enable parties and the court to negotiate in this regard. Yet, confidentiality and privacy of the hearings remain under the risk of detriment. Likewise, backlogs, loss of network and cut-offs in connection are irresistible obstacles for the process. These necessitate extra expenses on technology platform licencing, data protection and more effective equipments for remote hearings.

Different jurisdictions might have varying approaches towards the matter. Section 53 the Coronavirus Act 2020 determines that recording a broadcast from the court or transmission of the proceeding materials by the participants of the live hearings shall count for an offence. By Schedule 25, the Act further inserted special provisions on the use of live video or audio links, public participation and offences of recording to the Courts Act 2003 (Section 85A-85D) and Tribunals, Courts and Enforcement Act 2007 (Section 29ZA-29ZD).

As it had already been presented in section 32 of the Crime and Courts Act 2013, private hearings shall be recorded in a manner directed by the court and the court may decide the hearing to be broadcasted and recorded in a wholly audio or video manner. The recordings might be accessed by the application of any person with the consent of the court, otherwise making or attempting to make any unauthorised recording or transmission of an image or sound during in relation to the broadcast might bring an offence of a person. Except making or use of sound recordings for purposes of official transcripts of proceedings, such unauthorised recordings might bring a contempt of a court in accordance with Section 9 of the Contempt of Court Act 1981.

Regardless of these provisions nothing can guarantee that there will not be any unauthorized recording of the parties or judges or social media posts. Relevant to this, copyright status of the live stream is not entirely clear. This was also raised in National Bank of Kazakhstan case and can be found in the transcript of the second day of the remote hearings. Presumably the court owns copyright since any operation regarding the recordings or streaming needs to get authorization by that court. It would be necessary to get parties’ consent prior to the actual hearings potentially by a particular protocol while filing documents electronically.

Some Thoughts on the Future Perspective

The new way of the hearings will hardly remove the traditional charisma of the courts and in person trials. On the other hand, remote hearings might hardly be possible in complex cases containing mass documentations, third parties and cross-examination of many witnesses. Still, digitisation will presumably continue even after the crisis ends.

In this regard, encompassing actions and a solid strategy are crucial for fixing the discussed problems and achieving constant benefits of technology. Even though implementation of a new initiative would most probably take longer amid timely urgency of the matter lessons could be learned from the status quo as a testing stage, a reasonable action plan could be established and applied post-crisis to achieve long-term effectiveness.

The intense use of technology at trials will advance the already existing fundamental principle of open justice in judiciary even after the crisis. While taking new initiatives judiciary might consider benefits that have already been offered by the ODR procedures for facilitating settlement and resolution of the disputes. Besides creative use of technology, cooperation of the parties with the court and compromise to narrow the disputes would be encouraged.

Along with the legislative measures taken within the borders, a global mechanism providing guidelines on remote hearings and accessible by the states would be useful for certainty and uniform standards at an international level. In this regard, the arbitration community (e.g. ICC, SIAC, ICSID) has been quite rapid in drafting case management updates and guidance documents for minimizing the impact of the COVID-19.

Apart from coronavirus guidelines prepared by various arbitration organizations (e.g. ICC, SIAC), another step in this regard has been the recent Seoul Protocol on Video Conferencing in International Arbitration achieved by Korean Commercial Arbitration Board (KCAB). While looking for innovations particular attention should be placed on the European practice. Videoconferencing has been a widely used tool in Europe both at national and regional levels on the basis of different legal frameworks including the EU regulations and protocols. “Videoconferencing” project has become an integral part of the European e-Justice action plan and the Council and Commission regularly collect and publish good practice and examples of the Member States. These might be helpful while preparing a long-term action plan notwithstanding withdrawal of the United Kingdom from the Union.

Last but not least, the quote of the ancient Greek poet, Euripides is worth to recall here: “Nothing has more strength than dire necessity”. Although the pandemic has brought enormous impacts on the justice systems and resulted in significant uncertainties in the proceedings every cloud has a silver lining. As many others the UK government has also taken serious measures to combat the crisis and reduce its negative effects on judiciary. However, numerous challenges at the testing stage have been eye-openers for the government to gain more insight of the national, regional or international systems, generate more innovative and creative solutions and develop a strategic action plan for the advanced use of technology at trials. These will most likely lead to inevitable revisions of the CPR rules and related statutes in the near future.