Droit international général

The following entry is the first of two parts that provide an introduction to the Elgar Companion to the Hague Conference on Private International Law (HCCH). Together, the parts will offer readers an overview of the structure of the Companion (Part I) as well as of the core themes as they emerged from the 35 Chapters (Part II). Both parts are based on, and draw from, the Editors’ Introduction to the Elgar Companion to the HCCH, which Elgar kindly permitted.

The Elgar Companion to the HCCH will be launched on 15 December 2020 as part of a 1 h long virtual seminar. The Companion, edited by Thomas John, Dr Rishi Gulati and Dr Ben Koehler, is a unique, unprecedented and comprehensive insight into the HCCH, compiling in one source accessible and thought-provoking contributions on the Organisation’s work. Written by some of the world’s leading private international lawyers, all of whom have directly or indirectly worked closely with the HCCH, the result is a collection of innovative and reflective contributions, which will inform shaping the future of this important global institution.

The Companion is timely: for more than 125 years, the HCCH has been the premier international organisation mandated to help achieve global consensus on the private international law rules regulating cross-border personal and commercial relationships. The organisation helps to develop dedicated multilateral legal instruments pertaining to personal, family and commercial legal situations that cross national borders and has been, and continues to be, a shining example of the tangible benefits effective and successful multilateralism can yield for people and businesses globally.

The Companion approaches private international law classically, that is, by understanding the subject matter with reference to its three dimensions: jurisdiction, applicable law, and the recognition and enforcement of foreign judgments. But, as the contributions in this work show, since its inception, and in particular since the 1980s, the HCCH has helped to reach international consensus concerning a further, a “fourth” dimension of private international law: cross-border legal cooperation.

In line with this development, and with the firm belief that such cooperation is crucial to the private international law of the 21st century, the Companion has adopted a strong focus on cross-border legal cooperation, including by an increased use of technology. This deliberate choice was fortuitous: the global pandemic is testing the domestic and international justice sector like never before, bringing into sharp focus the often non-existing or still arcane methods prevalent especially in the area of cross-border legal cooperation.

The Companion comprises 35 Chapters that are organised into three Parts.

Part I consists of three Sections. Section 1 considers the HCCH as an international organisation and the contributions trace the development of the Organisation from its inception in 1893 until the present day, including its trajectory towards a truly global organisation. The initial Chapters specifically concern the history of the HCCH; its institutional setting, especially in terms of the HCCH’s privileges and immunities; as well as a contribution on the relationship between the HCCH, and the other two international organisations dealing with international private law issues, i.e., UNCITRAL and UNIDROIT, often also referred to as the HCCH’s ‘Sister Organisations’.

The following Section is dedicated to the HCCH as an organisation with global reach. The Chapters demonstrate how the HCCH is evolving from an organisation whose membership was historically European-based into an increasingly global institution. The HCCH currently has 86 Members (as of December 2020), comprising 85 States and the EU. Perhaps other Regional Economic Integration Organisations (REIO) may also become members one day, and this should be encouraged. Remarkably, since the turn of the century, the HCCH has added 39 New Members (or 45% of its current membership), including six South American States, two States from North America, one in Oceania, fourteen in Asia, eleven in Europe and five in Africa.[1] Since 3 December, the HCCH has a further Candidate State: Mongolia, which has applied for membership and for which the six-month voting period is now running. Importantly, this Section considers the HCCH’s expanded reach, including thoughtful contributions on the organisation’s work in Latin America and the Caribbean; Africa; and in the Asia Pacific. The Chapters also reflect on the work of the HCCH’s Regional Offices, namely, the Regional Office for Asia and the Pacific (ROAP), which is based in Hong Kong and commenced its work in 2012; as well as the Regional Office for Latin America and the Caribbean (ROLAC), operating out of Buenos Aires since 2005.

Part I’s final Section looks at the HCCH as a driver of private international law. The Chapters contain stimulating contributions concerning some of the contemporary philosophical dimensions of private international law as shaped by globalisation, and the ways in which the HCCH can be understood in this context; the role the Organisation can play in shaping private international law into the future; considering whether the 2015 Choice of Law Principles establish a good framework for regulatory competition in contract law; what role the HCCH can play in further strengthening legal cooperation across borders; and the concept of public order, including its relationship with mandatory law.

Part II of the Companion concerns contributions on existing HCCH instruments. It traces the evolution, implementation, and effectiveness of each of those instruments, and looks forward in terms of how improvements may be achieved. The contributors not only provide a record of the organisation’s successes and achievements, but also provide a critical analysis of the HCCH’s current work. They canvassed the traditional tripartite of private international law, including forum selection, choice of law and the recognition and enforcement of judgments. In addition, they also provided their thoughts on the fourth dimension of private international law, i.e. cross-border legal cooperation, tracing the pioneering, as well as championing, role of the HCCH in this regard, resulting in cooperation being a quintessential feature, in particular of more modern conventions, developed and adopted by the HCCH.

Part II is organised following the three pillars of the HCCH: (1) family law; (2) international civil procedure, cross-border litigation and legal cooperation; and (3) commercial and financial law.

The first Section of Part II addresses HCCH instruments in the family law sphere. Contributions include an analysis of the HCCH and its instruments relating to marriage; the 1980 Child Abduction Convention; the 1993 Intercountry Adoption Convention; a Chapter on the challenges posed by the 1996 Child Protection Convention in South America; the 2000 Adult Protection Convention; a contribution on HCCH instruments in the area of maintenance Obligations; the work of the HCCH in the field of mediation in international children’s cases; and a contribution overviewing the interaction between various HCCH instruments concerning child protection.

The second Section concerns HCCH instruments that are some of its major successes. But as the Chapters show, more work needs to be done given the ever-increasing cross-border movement of goods, services and people, and the need to better incorporate the use of technology in cross border legal cooperation. Contributions concern the 1961 Apostille Convention; the 1965 Service and 1970 Evidence Conventions; the 2005 Choice of Court Convention; and finally, the 2019 Judgments Convention which was decades in the making.

The final Section in Part II consists of contributions on HCCH commercial and finance instruments. Contributions specifically focus on the 1985 Trusts Convention; the 2006 Securities Convention; and the 2015 Choice of Law Principles, which constitute a soft law instrument demonstrating versatility in the kind of instruments HCCH has helped negotiate.

Part III of the Companion consists of Chapters that discuss the substantive development of private international law focusing on current and possible future priorities for the HCCH. In that regard, this Companion seeks to bridge the HCCH’s past and its future.

The first Section focuses on current priorities. It consists of contributions on a highly difficult and sensitive area of international family law, i.e. parentage and international surrogacy and how the HCCH may assist with its consensual solutions; how the HCCH may play a global governance role in the area of the protection of international tourists; and how the exercise of civil jurisdiction can be regulated. Specifically, this Chapter shows how the doctrine of forum non conveniens is increasingly being influenced by access to justice considerations, a matter borne out by comparative analysis.

The second Section of Part III, and of the Companion, contemplates possible future priorities for the HCCH. Contributions concern how private international law rules ought to be developed in the context of FinTech; what role the HCCH may play in setting out the private international law rules in the sphere of international commercial arbitration; how the digitisation of legal cooperation ought to reshape the fourth dimension of private international law; the potential development of special private international law rules in the context of complex contractual relationships; how the HCCH can engage with and embrace modern information technology in terms of the development of private international law; and finally, what role there is for the HCCH in developing a regulatory regime for highly mobile international employees. It is hoped that in addition to providing ideas on how progress may be made on its current priorities, the contributions in Part III can also provide a basis for the HCCH’s future work.

The editors, who collaboratively prepared this entry, chose this structure for the Companion to provide the reader with an easy access to a complex organisation that does complex work. The structure also makes accessible the span of time the Companion bridges, chronicling the HCCH’s history, reaching back to 1893, while looking forward into its future.

The second entry on Conflict-of-Laws.net will outline the editor’s reflections on the 35 Chapters, drawing out some of the key themes that emerged from the Companion, including the HCCH’s contribution to access to justice and multilateralism.

[1] HCCH, ‘Members & Parties’ <https://www.hcch.net/en/states> accessed 6 December 2020. The latest Member State is Nicaragua for which the Statute of the HCCH entered into force on 21 October 2020.

The University of Zurich, Switzerland, has asked CoL to publish the following:

The University of Zurich is seeking applications for a Professorship in private law (with a focus on the Code of Obligations) to take effect from the beginning of the Spring Semester 2022 (1 February 2022), or by arrangement. The level of employment is 50%. The professorship is to be occupied by an individual with a command of the Swiss Code of Obligations as a subject in its full breadth and in reference to comparative law. Proof of exceptional qualification in this subject is to be provided in the form of an outstanding dissertation and a completed or near-com-pleted habilitation thesis (or equivalent academic accomplishment). Also desirable is a willingness to use research and teaching to address current issues concerning the Code of Obligations that may arise in the course of digitalisation, for example, as well as other develop-ments. Depending on the applicant’s qualifications, the professorship will take the form of a full or associate professorship. A temporary tenure-track assistant professorship is possible if the applicant’s habilitation thesis is at an advanced stage but is not yet completed. The University of Zurich strives to increase the representation of women in research and teaching, and therefore specifically encourages qualified female academics to apply. Further information relating to this job profile can be found below. Please submit your application documents as specified in the job profile by 30 December 2020 via www.recruiting.ius.uzh.ch. You may be requested to submit hard-copy documents separately at a later point. The relevant member of the appointment committee, Professor Helmut Heiss (helmut.heiss@rwi.uzh.ch), is available to answer any questions and provide further information.

Further information is here.

The British Institute of International and Comparative Law (BIICL) (in consortium with Civic Consulting) has been selected by the European Commission to conduct a study supporting the preparation of a report on the application of the Rome II Regulation (EC) No. 864/2007 on the law applicable to non-contractual obligations (JUST/2019/JCOO/FW/CIVI/0167).

The study assesses the 10-year application of the Rome II Regulation in the Member States and will support the Commission in the future review of the Regulation. It analyses all areas covered and looks into specific, cutting-edge questions, such as cross-border corporate violations of businesses against human rights and the potential impact of the development of artificial intelligence.

To gather views of practitioners and academics from all Member States, BIICL conducts a survey which is available here: https://www.surveymonkey.com/r/JLWQ8XQ

Please contribute your experience to the study, if you have a particular expertise in the Rome II Regulation, or in one of the above-mentioned areas – namely cross-border torts related to artificial intelligence, corporate abuses against human rights, or defamation.
BIICL invites interested colleagues from all Member States to participate in the survey, but seeks in particular more contributions from: Bulgaria, Croatia, Cyprus, Finland, Luxembourg, Romania and Slovenia.

Deadline: December 31st, 2020

More information about the Study is available on BIICL’s website (https://www.biicl.org/projects/com-study-on-the-rome-ii-regulation).

The author of this post is Caterina Benini, a Phd student at the Catholic University of the Sacred Heart in Milan.

In the credits market, the price of a contract (or that of the claims arising from a contract) is determined by the nominal value of the claims concerned and by the risks surrounding their enforcement, including the risks relating to the uncertainty that may exist as to the courts with jurisdiction to hear and enforce the contract or the claims concerned.

Ironically, uncertainty may be greater when the assigned contract includes a choice of court clause, as it is not clear whether, and subject to which conditions, such a clause may be binding upon the assignees.

The European Court of Justice considered the issue of the third-party effects of choice of court clauses in Tilly Russ, Coreck and Profit Investment.

However, it was only in Ryanair, a case decided on 18 November 2020, that the Court specifically analysed whether an assignee of a claim is bound by the choice of court clause included in the contract from which the assigned claim arose. The recent Court’s ruling raises a number of questions, some of which have already been pointed out by Matthias Lehmann in this blog.

One takeaway of Ryanair is that, in the absence of clear rules, the fate of choice of court agreements following the assignment of the contract which included them is a fertile ground for disputes. Instead of elaborating on the Court’s findings in Ryanair, I will focus on a recent ruling of the Italian Supreme Court (Corte di Cassazione), which addressed the consequences of an assignment of claim for the enforceability of a choice of court clause (Judgment No 7736/2020).

The facts underlying the case decided by the Italian Supreme Court may be summarised as follows.

An Italian company (hereinafter, the manufacturer) and a Finnish company (the distributor) entered into various contracts. Each contract included a choice of court clause conferring exclusive jurisdiction upon the Tribunal of Torino. The Italian manufacturer assigned part of its claims under the contracts to a factoring company seated in Italy. Following the assignment, a dispute arose between the manufacturer (the assignor creditor) and the distributor (the assigned debtor). Upon an application by the former, the Tribunal of Torino ordered the Finnish distributor to pay a certain amount of money. The latter lodged an opposition, arguing that, as a result of the assignment of the claims, the Italian company was prevented from relying on the choice of court clause featured in the contracts.

Both the Tribunal of Torino and the Court of Appeal of Torino dismissed the move. The Finnish distributor brought the case before the Corte di Cassazione, which dismissed the appeal, ultimately upholding that Italian courts had jurisdiction to hear the case.

The Cassazione reached that conclusion on the ground that the effectiveness of a choice of court clause between the original parties to a contract giving rise to claims subsequently assigned should not be doubted. The Cassazione referred for this purpose to the case-law of the Court of Justice, noting that, according to Dansommer and Profit Investment, a choice of court agreement may be binding also upon the third party, thus impliedly submitting that this the assignment results in an extension of the subjective scope of the clause rather than a transferral of the same from one assignor to the assignee.

The Court added that the assignee, having taken over the position of the assignor vis-à-vis the assigned debtor, is bound by the choice of court agreement included in the contract giving rise the claim. This is because the position of the assigned debtor should remain unaltered also with regard to jurisdiction, if not otherwise provided by the assigned party himself and the assignee.

This Author’s Submission

If party autonomy is to be taken seriously, choice of court clauses, it is submitted, should be deemed to be subject to an independent regime, different from that governing the contract where the clause is featured.

This implies that, for the purposes of determining the fate of a choice of court clause following the assignment of the legal relationship to which the clause refers, or belongs, reference ought to be had to the substantive law applicable to the dispute resolution clause itself. It is on the basis of the latter law that one should assess whether the rights and obligations provided for under the choice of court clause passed on to the assignee.

No other approach, it is contended, would be consistent with Article 25(5) of the Brussels I bis Regulation. This provides that “[a]n agreement conferring jurisdiction which forms part of a contract shall be treated as an agreement independent of the other terms of the contract”, adding, in a separate subparagraph, that “[a]n agreement conferring jurisdiction which forms part of a contract shall be treated as an agreement independent of the other terms of the contract”.

The issue of the fate of a dispute resolution agreement following the circulation of the legal position to which the clause relates has been mainly discussed with respect to arbitration agreements. Although choice of court agreements cannot be equated to arbitration agreements, the terms of the problem roughly coincide.

Essentially, the discussion revolves around two opposite conceptions of the principle of severability.

The first interpretation posits that, while the dispute resolution clause is severable from the main contract for validity purposes, it should be considered as an integral part of the contract for transferability purposes. Hence, when the assignee becomes the holder of the rights and obligations that arise from the contract which includes the dispute resolution agreement, it becomes automatically bound by the latter as well.

The second approach views the severability principle as a mere façade of a broader principle, which requires to consider a dispute resolution agreement as a contract in its own right, independent in all aspects from the contract to which it refers. This means that, unless the parties agree otherwise, the dispute resolution agreement will not automatically circulate together with the contract as a result of the assignment.

Article 25(5) of the Brussels I bis Regulation fosters the second approach described above.

Indeed, if the principle of separability were to operate for validity purposes only, the EU legislator would have limited Article 25(5) to the first subparagraph, which enshrines the principle in its traditional meaning. The inclusion of a separate subparagraph specifying that a choice of court agreement shall be considered independently from the other terms of the contract suggests that, in the view of the legislator, the principle involves more than merely prescribing the survival of the dispute resolution clause in the event that the main contract is invalid. Rather, it is submitted, the whole of para 5 indicates that a choice of court clause should be considered, in all respects, to be independent from the agreement where it is featured.

The question then is: what does the independence of a choice of court clause precisely stand for?

Independence should not be taken as meaning that the choice of court agreement should be treated as something that is materially separate from the main contract.

Arguably, the independence of the clause means that the issues surrounding the clause rules are not (necessarily) to be decided in accordance with the rules that one would resort to for the purposes of deciding the same issues in respect of the main contract.

Such normative independence of choice of court clauses has already been recognized with respect to the formal validity, which has been consistently evaluated on the basis of the uniform material rules provided for by the Brussels Regime and not on the basis of the formal requirements governing the main contract.

The same approach should then be followed also for the fate of choice of court agreements. This means that the court seised of the matter should assess whether the assignee of the contract (or of the claims arising thereform) is bound by the choice of court agreement, based on the rules governing the transferability of the dispute resolution agreement itself.

If such solution were to be followed, it would entail a significant alignment with Castelletti, where the Court ruled that “the national court seised should be able readily to decide whether it has jurisdiction on the basis of the rules of the Convention, without having to consider the substance of the case” (para. 48). Indeed, the seised court may rule on its own jurisdiction without dwelling into the merits of the case only if the enforceability of the choice of court clause is subject to a different and autonomous from the one applicable to the substantive issues.

The above analysis on the principle of separability of choice of court clauses can turn useful when the interpreter (as the Corte di Cassazione did) investigates whether the CJEU’s case-law developed in relation to the third-party effects of choice of court agreements can provide an answer to the issue of the fate of choice of court clauses.

In Tilly Russ, the Court of Justice ruled that the third party is bound by the jurisdiction clause incorporated in the main contract (a bill of lading in that case), which is valid as between the original parties, “in so far as a third party, by acquiring the bill of lading, has succeeded to the shipper’s rights and obligations under the relevant national law” (para. 24).

The meaning of this crucial passage of the Court’s reasoning is unclear. One may wonder whether the shipper’s rights and obligations in which the third party succeeds are those provided for under the main contract or the dispute resolution clause. The aspect has since never been clarified by the Court, although the Court did rely on the said passage in Coreck and Profit Investment.

According to the majority of scholars, the rights and obligations to which the Court referred are those arising from the main contract. This entails that, if the third party succeeds to the assignor’s rights and obligations under the main contract in accordance with the law applicable to the assignment, the third party is automatically bound by the choice of court agreement included in the main contract.

This conclusion contradicts the independence of choice of court agreements.

Independence requires that issues relating to a choice of court clause be solved on the basis of the rules governing the dispute resolution agreement itself, regardless of the rules governing the main contract. The vicissitudes of the main contract, including the assignment of the claims arising thereform, are not relevant per se to the dispute resolution clause.

In light of this, the passage in Tilly Russ recalled above should be interpreted as requiring the seised court to determine whether the third party, simultaneously or after entering into the main contract, “has succeeded to the shipper [assignor]’s rights and obligations [provided for under the jurisdiction clause] under the relevant national law [applicable to the jurisdiction clause]”.

Which law applies to a dispute resolution clause?

Courts sitting in a Member State cannot rely on the Rome I Regulation, given that choice of court agreements are excluded from the scope of application of the Regulation under Article 1(2)(e). Accordingly, regard should be had to domestic conflict of laws rules.

In a case such as the one discussed by the Corte di Cassazione in the ruling mentioned above, the relevant provision would arguably be Article 57 of the Italian Statute of Private International Law. The rule, drawn up in 1995 (and never amended since) extends the operation of the 1980 Rome Convention on the law applicable to contractual obligations (the predecessor of the Rome I Regulation) to any contract, including those excluded from the scope of the Convention itself.

Assuming that the reference to the Convention should be read today as a reference to the Rome I Regulation, an Italian court would – in the absence of a choice of law – rely on Article 4(4) of the Rome I Regulation, and apply the law of the country with which the choice of court agreement is most closely connected.

The PAX Moot is a specialised moot court competition dedicated to students interested in Private International Law.

The 2021 Round of the competition is named after Arthur von Mehren, a renowned scholar of international procedure law across the Atlantic, for the 15th anniversary of his passing away.

This Round of the competition will focus on Transnational Law and Private International Law issues and will require participants to apply and handle the complexities and nuances of how international conventions and regulations interact with each other in the context of globalisation.

The case is grounded in the present challenging global events (COVID-19 virus) and involve the application of the new 2019 Hague Judgments Convention.

The competition comprises a written round and an oral round for the students. The teams will be required to address matters of jurisdiction, applicable law and parallel actions.

More information about the competition and its timetable are available here and here.

JK Fabrications Ltd v Fastfix Ltd & Anor [2020] NIQB 63 is a good illustration of how not to draft choice of court (and governing law, in fact) provisions generally, let alone in general terms and conditions – GTCs. Albeit with a shaky obiter suggestion on identifying a court.

Tobsteel GmbH domiciled in Őhringen, Germany seeks to set aside a third party notice served on it on the ground that the Northern Irish courts have no jurisdiction to determine the third party proceedings brought by Fastfix, domiciled in Ireland.  Fastfix is the defendant in proceedings brought by JK Fabrications, domiciled in Northern Ireland.  In separate proceedings JK Fabrications Limited is sued by SMBJV, an unincorporated joint venture in respect of a major sewerage project in London.  Bolts are the common element in dispute in both cases; the bolts supplied by Tobsteel to Fastfix who in turn supplied these bolts to JK Fabrications.

As justifiably held by Larkin J, the choice of court upon which Tobsteel bases its argument, itself was not properly bolted. The clause at issue is included in a  “General Terms of Supply and Payment for TOBSTEEL GmbH” document which  General Terms of Delivery and Payment document in which clause VIII reads

“VIII. Place of performance, choice of forum, applicable legislation. 

 1.        The place of performance and choice of forum for deliveries and payments (including complaints regarding cheques or bills) and for all disputes arising between us and the purchaser from the purchase contracts concluded between us and him or her shall be Öhringen.  However, we shall be entitled to file a complaint against the purchaser at his or her residence or registered business address.

2.         The legal relationship between us and our customers or between us and third parties shall be governed exclusively by the legislation of the Federal Republic of Germany”

The judgment shows that Tobsteel itself in fact did not initially see clear as to which GTCs applied. In earlier affidavits, two more, and different, versions of GTCs were said to apply.

The first level of discussion was whether there had at all been consent to the GTCs. The judge held there had not been. At 16:

The instrument on which Tobsteel relies as the vehicle of agreement is a combination of the words “Subject to our general terms of business if requested a print can be provided” and Mr Connolly’s [of Fastifx, GAVC] email containing the words “Alex, this is O.K.”. This combination is too fragile to bear that weight.

This was not so much (at 17) because it could not be established that the clause had actually been consulted by Mr Connolly. Larkin J, in line with the Report Jenard:

While it is often a commercially necessary fiction that a party has ‘agreed’ terms that he may not have seen in advance, far less read, based on his signature indicating his consent to be bound by such terms or some other manifestation of acceptance, …

Rather, it has to be clear which version of what is actually referred to: at 17:

..it is observable that in those cases in which this commercially necessary fiction operates, it will be clear what the applicable terms are.

At 19-20:

If Tobsteel wished, as I find it did, to secure agreement on Clause VIII.1 with Fastfix it needed an adequate mechanism or instrument for obtaining that agreement.  In the event, and taking the evidence for Tobsteel at its reasonable height, Tobsteel sought to bind Fastfix in the documents referred to above to Tobsteel’s “general terms of business”.  Clause VIII.1 of June 2014 is not contained in a document entitled “general terms of business” but in a document entitled “General Terms of Supply and Payment for TOBSTEEL GmbH”.  One might properly say, further, that in 2017  Herr Gebert, insofar as he thought specifically about the matter, meant to refer to the June 2004 text, but whether he meant to or not, he did not refer to it so as to permit the creation of an agreement between Tobsteel and Fastfix that Clause VIII.1 should apply.

In none of the cases on Article 25 or its antecedents is there an example of a term incorporating X by reference being held to incorporate Y by reference and thus satisfy the requirements of [A25].

In conclusion, consent had not been clearly and precisely demonstrated. Again, this is a clear emphasis on the need for proper GTC filekeeping.

At 21 ff the judge obiter but in this case in my view wrongly, holds that even if he had found there to have been consent to the clause, it did not meet with the requirements of A25 BIa. As a reminder, the clause reads

 1.        The place of performance and choice of forum for deliveries and payments (including complaints regarding cheques or bills) and for all disputes arising between us and the purchaser from the purchase contracts concluded between us and him or her shall be Öhringen.  However, we shall be entitled to file a complaint against the purchaser at his or her residence or registered business address.

2.         The legal relationship between us and our customers or between us and third parties shall be governed exclusively by the legislation of the Federal Republic of Germany”

The judge argues that the proviso at 1 does not identify a court at all and that the choice of law proviso in 2 cannot come to the rescue (it could conversely, under Rome I) for choice of court and law as recently emphasised in Enka Insaat are to be looked at differently.

I agree 1 is an odd mix of anchoring locus solutionis typically done under A7(1) BIa, with what seems to be a unilateral choice of court pro Tobsteel; and that on that basis it might be vulnerable as choice of court under A25 (but it could be rescued under A7(1). I disagree that the name of a town that has a court (let alone a court; which the judge agrees with) needs to be included for it to be proper choice of court: name any town and local civil procedure rules will tell you the relevant court.

‘(A)n agreement on ‘Derry Recorder’s Court’ would satisfy the requirement of Article 25 that a court be agreed but that an agreement on ‘Derry’ would not.’: I do not think that is correct.

Geert.

EU Private International Law, 3rd ed. Feb 2021, 2.296, 2.315 ff

Rather like I note in my report on Highbury Poultry Farm,  Secretary of State for Health & Ors v Servier Laboratories Ltd & Ors [2020] UKSC is another example of why the UK Supreme Court and counsel to it will be missed post Brexit.

The case in essence queries whether a CJEU annulment (in General Court: Case T-691/14, currently subject to appeal with the CJEU) of a finding by the European Commission that companies breached Article 101 and 102 TFEU’s ban on anti-competitive practices, is binding in national proceedings that determine issues of causation, remoteness and mitigation of loss. The answer, in short: no, it does not.

The case essentially revolves around the difficulty of applying common law concepts of authority and precedent to the CJEU’s more civil law approach to court decisions. For those with an interest in comparative litigation therefore, it is a case of note.

The essence in the national proceedings is whether Claimants [who argue that Servier’s breaches of EU and UK competition law led to a delay in generic Perindopril entering the UK market, resulting in higher prices of Perindopril and financial loss to the NHS) failed to mitigate the loss they claim to have suffered as a result of Servier’s (the manufacturer of the drug) infringement of the competition rules. The Court of Appeal’s judgment is best read for the facts.

In T-691/14 Servier SAS v European Commission, the General Court of the EU had annulled only part of the European Commission’s decision by which it was found that the Appellants had infringed Article 102 TFEU. In the present proceedings, Servier seek to rely on a number of factual findings made by the
GCEU in the course of its judgment and argue that the English courts are bound by those findings. The High Court and the Court of Appeal have held that the propositions on which the Appellants seek to rely are not res judicata.

Core CJEU authority discussed is Joined Cases C-442/03P and C-471/03P P&O European Ferries (Vizcaya) SA and Diputación Foral de Vizcaya v Commission.

Lord Lloyd-Jones reaches the crux of his reasoning, on the basis of CJEU authority, at 39:

The principle of absolute res judicata gives dispositive effect to the judgment itself. It is the usual practice of EU courts to express the outcome of the action in a brief final paragraph of the judgment referred to as the operative part. While this will have binding effect, it will be necessary to look within the judgment beyond the operative part in order to ascertain its basis, referred to as the ratio decidendi. (EU law has no system of stare decisis or binding precedent comparable to that in common law jurisdictions and this EU concept of ratio decidendi is, once again, distinct from the concept bearing the same name in the common law.) It will be essential to look beyond the operative part in this way in order to identify the reason for the decision and in order that the institution whose act has been annulled should know what steps it must take to remedy the situation. In a case where the principle of absolute res judicata applies, it will extend to findings that are the necessary support for the operative part of the annulling judgment.

The GC’s findings were based on a limited ground only, relating to too narrow a market definition under A102 TFEU. As presently constituted, the claim in the national proceedings is a claim for breach of statutory duty founded on alleged infringements of article 101 TFEU. No question arises in the proceedings before the national court as to the relevant product market for the purposes of A102 or the applicability of A102.

The national proceedings therefore concern causation, remoteness and mitigation of loss in the arena of article 101 TFEU. The narrow res judicata window, it was held, clearly does not apply to them and that is acte clair which needs no referral to Luxembourg.

Geert.

Binding scope of #CJEU annulment of EU measure
Viz Res judicata, issue estoppel and abuse of process as understood in common law jurisdictions
Whether annulment of EC 101 TFEU finding is binding in national proceedings re issues of causation, remoteness and mitigation of loss https://t.co/yrgyoosoVr

— Geert Van Calster (@GAVClaw) November 6, 2020

The post below was written by Adrian Briggs QC, who is Professor of Private International Law at the University of Oxford. It is the second contribution to the EAPIL online symposium on the ruling of the Court of Justice in the case of Wikingerhof v. Booking (the first one, by Matthias Lehmann, appeared earlier today and can be found here).

Other contributions will follow in the coming days. Readers are encouraged to share their views by making comments to the posts. Those wishing to submit longer contributions for publication are invited to get in touch with the managing editor of the blog, Pietro Franzina, at pietro.franzina@unicatt.it.

The late, great, F A Mann was sometime heard to refer, in a wry way which one could never quite interpret, to ‘common law pragmatism’. It has served us well; and it provides a vantage point for an assessment of the decision in C-59/19 Wikingerhof GmbH & Co KG v Booking.com BV EU:C:2020:950. Those looking for theory will, no doubt, find it elsewhere. The observations sketched out below simply seek to explain why the decision of the Grand Chamber is, as a matter of practical law, a disaster.

Where a claim is raised between parties who have chosen to place themselves within the ties of a voluntary relationship, and something goes wrong, the claim which results may be seen as an incident of that relationship which should be subject to jurisdictional rules designed for disputes arising within that relationship. Though in the Brussels/Lugano context this is seen and understood most clearly in the context of insurance, and consumer and employment contracts, it was also understood, with brilliant clarity by Darmon A-G in 189/87 Kalfelis. Spurning his advice, the Court in that case preferred to describe a virtual line between claims treated as contractual and those allocated to the special jurisdiction for tort and delict. This might have meant that a non-contractual claim could, in principle at least, be raised between contracting parties; and the seeds of trouble were thereby sown. A narrow question mesmerised the English, argued endlessly about what to do about claims based on unjust enrichment; but the deeper question was when a claim based on an obligation owed by one contracting party to another might be held, for the purpose of special jurisdiction, not to be a matter relating to a contract. A serviceable answer, and perhaps the only sensible answer, was eventually given by the decision in C-548/12 Brogsitter, which in material part observed that

It is apparent from the order for reference that the parties to the main proceedings are bound by a contract. However, the mere fact that one contracting party brings a civil liability claim against the other is not sufficient to consider that the claim concerns ‘matters relating to a contract’ within the meaning of Article 5(1)(a) of Regulation No 44/2001. That is the case only where the conduct complained of may be considered a breach of contract, which may be established by taking into account the purpose of the contract. That will a priori be the case where the interpretation of the contract which links the defendant to the applicant is indispensable to establish the lawful or, on the contrary, unlawful nature of the conduct complained of against the former by the latter. It is therefore for the referring court to determine whether the purpose of the claims brought by the applicant in the case in the main proceedings is to seek damages, the legal basis for which can reasonably be regarded as a breach of the rights and obligations set out in the contract which binds the parties in the main proceedings, which would make its taking into account indispensable in deciding the action. (italics added)

In other words, if the substance of the complaint could be said to have broken the contract to which the parties had bound themselves, special jurisdiction in the matter was contractual. It was a clear rule even though, as it now seems, the casual, justificatory, reference to the contract as indispensable gave dissenters something to make mischief with. In the meantime, the Court in C-47/14 Holterman simply copied this part of Brogsitter into a judgment principally concerned to maintain the integrity of Section 5 of Title/Chapter II. As well it might: the opportunity for an unscrupulous employer to strip the employee of the protection provided to him by accusing him of being a tortfeasor/thief rather than a contract-breaker, all the while denying that the employment contract needed to be referred to for anything other than data, was plain and obvious and quite, quite wrong. At this point we might have hoped for a period of stability; it was not to be. An unduly judgmental Opinion in C-603/17 Bosworth seemed unhappy with the idea that powerful office holders accused of fraud could derive any benefit from Section 5, but the idea that an employee might be deprived of his shield by a bare accusation of fraud was not underwritten by the Court which otherwise left the issue well alone.

But after another regrettable Opinion, and the calamitous judgment which this time swallowed it whole, the clear rule in Brogsitter, and the foundation of Kalfelis, has been stood on its head. It now appears to be the law that if the complaint may be framed or pleaded as a tort, it may by this means be excluded from the special jurisdiction rule for matters relating to a contract. According to the Court in C-59/19 Wickingerhof (and lightly editing the judgment for ease of reading):

Where the applicant relies on rules of liability in tort, delict or quasi-delict, namely breach of an obligation imposed by law, and where it does not appear indispensable to examine the content of the contract concluded with the defendant in order to assess whether the conduct of which the latter is accused is lawful or unlawful, since that obligation applies to the defendant independently of that contract, the cause of the action is a matter relating to tort, delict or quasi-delict. Wikingerhof relies on an infringement of German competition law, which lays down a general prohibition of abuse of a dominant position, independently of any contract or other voluntary commitment. Specifically, Wikingerhof takes the view that it had no choice but to conclude the contract at issue and to suffer the effect of subsequent amendments to Booking.com’s general terms and conditions by reason of the latter’s strong position on the relevant market, even though certain of Booking.com’s practices are unfair. Thus, the legal issue at the heart of the case in the main proceedings is whether Booking.com committed an abuse of a dominant position within the meaning of German competition law. As the Advocate General stated in points 122 and 123 of his Opinion, in order to determine whether the practices complained of against Booking.com are lawful or unlawful in the light of that law, it is not indispensable to interpret the contract between the parties to the main proceedings, such interpretation being necessary, at most, in order to establish that those practices actually occur.

Those who look to the jurisprudence of the Court for answers rather than distracted theorising will rightly despair at this bouleversement. Even if one leaves aside the damage which this new approach would do were it allowed to infect Sections 3, 4 and 5 of Title/Chapter II, how is it supposed to work in common or garden cases of civil liability in which – as in Brogsitter – the claim may plausibly be pleaded by reference to contractual as well as by other-than-contractual duties ? From an English perspective, a number of cases come quickly to mind. Consider (1) the electrician who rewires a piece of equipment consigned to him for repair so negligently that it electrocutes me when I plug it in; (2) the banker, who provides a credit reference on a party with whom I am proposing to deal, who has not checked his records and so gives me bad advice; (3) the consultant who works with me to develop a new commercial opportunity but who purloins my confidential information to exploit it on his own account and at my expense; (4) the solicitor who abstracts funds which he held on my account; (5) the Uber driver who injures his passenger when he jumps a red light; (6) the doctor in private practice who molests his patient when she is on the examination table; (7) the fraudster who by deceit induces another to enter into a contract and that other, rather than rescind, sues for damages which have the same economic effect as rescission would have; (8) the person who by negligent misrepresentation induces another to enter a contract, with the same consequences as in (7); (9) the individual who by duress, or the unconscionable exercise of undue influence, causes the victim to conclude a contract with him or with another; and (10) any defendant who pleads in defence to a claim framed in tort that the parties made a contractual promise that the claim would not be brought. How many of these complaints are matters not relating to a contract ?

It might be said that in each case the wrong done was committed by a person who, in doing what he did or failed to do, broke the contract to which he had bound himself. It may also be said that (1) if my son had been the first to use the equipment he would be entitled to complain of the electrician’s negligence; (2) that if the applicant had not paid for the credit reference he would still be entitled to sue the banker for breach of the duty of care; (3) the misuse of confidential information is an equitable wrong, no matter how one comes by it; (4) fraud is fraud and theft is theft and though employment is the context it is not the cause of action; cases (5) and (6) speak for themselves; as to (7) and (8), the synergy of contract, tort, and equity as a means of dealing with pre-contractual misrepresentation means that they cannot now be pulled apart; in (9) the contract will be voidable, with an alternative claim for compensation being only doubtful; and (10) would appear to be the tip of an iceberg, for it happens all over the place. Are we now supposed to say that none of these falls within the special jurisdiction for matters relating to a contract because the duties owed and broken by the defendant arise from the general law and the contractual setting is no more than that ? That the contract is the stage but not the play ? Or is the answer – surely worse – that some do, or – surely worst – that it all depends on how the self-serving claimant chooses to plead out his claim ? This last possibility would be surprising. The Court’s jurisprudence on the place where financial loss occurs (C-375/13 Kolassa, C-12/15 Universal Music, C-304/17 Löber, C-343/19 Volkswagen, among others) has been haunted by the fear, slightly unreal, that if it is routinely held to occur at the place of the bank account out of which payment is made, a claimant, possessed of several bank accounts and uncannily impressive foresight, might pave the way to a favourable special jurisdiction. It now seems that the Court has allowed itself to be lured into the very trap it had seemed to be so concerned to avoid, or – perhaps – into an even bigger one.

One turns to examine the proposition that it is different if it is ‘indispensable’ to look to the contract. It is hard to see that this has any sensible meaning. Contracts contain all sorts of things in addition to the express promises each side makes to the other. They may make provision for the implication of terms. They may try to prevent the implication of terms: entire agreement clauses, no oral modification clauses, and so on. They may define performance obligations directly, or by the subtle chiaroscuro of express promise and exclusion clause: if liability for X is wholly excluded, there can hardly be said to be a duty to do X in the first place. They may limit the liability which would otherwise arise, or restrict the circumstances in which, or grounds upon which, a complaint may be made. They may incorporate terms from another instrument, or exclude certain statutory effects which might otherwise apply. They may provide for acts to be permitted if payment is made, such as the early termination of an agency. They may provide that a claim will not be brought in tort but that, for example, a claimant will accept a payment by way of compensation or compromise: in short, they may do all manner of things. The answer to the question whether it is indispensable to look into the contract is, surely, that it is always necessary: the contract may not add to the facts and matters in dispute, but save in the cases in which it is admitted before the writ is served, this cannot be known until one has looked. Contracts, and their interpretation, can be very complex and it is absurd to say that there is no need to look into the contract before one has looked into it. Stand, if only for an unhappy moment, in the shoes of the lawyer who advised the client that she had a case in tort and who, when asked whether he had looked into the contract to see what it might have said, says that he didn’t think there was any need to.

Granted, in Wikingerhof, it would have been a surprise to find an express term excluding any liability for abuse by Booking.com of its dominant position in the market. It may have felt odd to suggest that it was advisable, still less indispensable, to read through the contract to check; but one never knows, and this provides no basis for sound conclusion; and in any event, abuse of a dominant position is only a particular version of economic duress or undue influence, both of which lie right in the middle of the contractual mainstream. If Wikingerhof GmbH had been asked whether it considered Booking.com to have or not to have broken the contract, or unlawfully coerced the surrender or contractual rights, it could only have answered in the affirmative, albeit that it may have preferred not to say so. The defendant had, by the very conduct complained of, broken or wrongfully interfered with its contract with the claimant, yet the matter was not one relating to a contract. No matter how hard one rubs one’s eyes, this still looks wrong.

It may be asked whether the unspoken aim of the judgment in Wikingerhof was to assist the German claimant by finding a way for it to sue in the place in which it felt most comfortable; to ‘protect’ the weaker party, the vulnerable victim of a dominant abuser, as it were. One hopes that no such thought was present in the curial mind, for accusations of abuse, of fraud, are only ever accusations, and findings of abuse were many months away. And there is no little irony in the fact that the decision actually improves the jurisdictional position of the company which is in a position to abuse its dominant position. When it gets wind of the fact that a victim is about to launch proceedings, the dominant abuser will be able to rely on Wikingerhof and on C-133/11 Folien Fischer to bring proceedings, in the place of the event giving rise to the alleged loss, for a declaration that it committed no wrong. Worse, unscrupulous employers (we have no need to name names), already immune to the discipline of anti-suit injunctions, will have a new spring in their step. It is not easy to understand why this should be the way the law works.

The question framed by the judgment in Brogsitter was easy to understand and to answer: has anyone teaching the subject ever found that his or her students struggled with it ? Has anyone advising a client needed to spend anxious hours in wrestling with it ? One hopes not. What is proposed to replace it – has replaced it, if we have to accept that the damage has been done – will require us to go back over the vast range of overlapping claims and unclaims, of complaints which are, as a matter of analysis, ‘not only a simple breach of contract, but also of another obligation’ cases, and develop the science which will tell is when reference to a contract is ‘indispensable’ in order to settle the question of special jurisdiction. Brexit, Covid, and now Wikingerhof. What a wretched year. We are only one horse short of an Apocalypse.

First Part https://fb.watch/2a8DGPRMtc/ (HCCH); https://fb.watch/2a8XU-EuX6/  (ASADIP)

Second Part https://fb.watch/2a8Bmy347e/ (HCCH); https://fb.watch/2a8VDZCcPL/ (ASADIP)

The EAPIL blog hosts an online symposium on the ruling of the Court of Justice in the case of Wikingerhof v. Booking.com. The first contribution to the symposium, which is found below, is by Matthias Lehmann, who is Professor of Private International Law at the University of Vienna (as well as an editor of this blog).

Other contributions will follow (the next one will be out later today). Readers are encouraged to share their views by making comments to the posts. Those wishing to submit longer contributions for publication are invited to get in touch with the managing editor of the blog, Pietro Franzina, at pietro.franzina@unicatt.it.

In its judgment dated 24 November 2020 in Wikingerhof, the CJEU has recalibrated the relation between the heads of jurisdiction for contracts (Article 7(1) Brussels I bis Regulation) and for torts / delicts (Article 7(2)).

A hotel sued booking.com in Germany for abuse of a dominant position. The hotel alleged having been strong-armed by the booking platform into an unfavourable contract.

Booking.com denied the German court’s jurisdiction over the claim, citing a choice-of-forum clause in the contract in favour of a Dutch court. This clause was however held to be invalid by the referring German Federal Court.

If the case fell under the head of jurisdiction for torts/delicts in Art. 7(2) Brussels Ibis, German courts could have jurisdiction given that the harmful event could be said to have occurred in Germany. In contrast, if the case concerned a contractual claim in the sense of Art. 7(1) Brussels Ibis, the jurisdiction of the German courts would have been more doubtful, as it was not sure that the contract between Wikingerhof and booking.com was to be performed in Germany.

The legal issue was therefore whether an alleged abuse of a dominant position that consists in forcing another person into an unfavorable contract is tortious/delictual or contractual in nature.

The CJEU held the claim concerned a tort/delict matter. It cites its previous case law on the relation between the jurisdiction for contractual and tort claims, in particular the Kalfelis and the Brogistter case. In Kalfelis, the court had ruled that both heads of jurisdiction were mutually exclusive. In Brogsitter, the CJEU had held that a case is contractual in nature “where the interpretation of the contract … is indispensable to establish the lawful or, on the contrary, unlawful nature of the conduct complained of” (Brogsitter, para 25).

According to the CJEU in Wikingerhof, the interpretation of the contract was not indispensable to establish the unlawful nature of booking.com’s behaviour. True, the abuse of a dominant position resulted from the unfavourable clauses of the contract. Yet the CJEU highlights that the interpretation of the clauses was necessary only to establish the existence of an abuse. In other words, the contract is needed as factual evidence, not as a legal standard. The Advocate General basically states the same when he calls the interpretation of the contract a “preliminary question” (Wikingerhof, para 124).

After the CJEU judgment in Brogsitter, one could have feared that the head of jurisdiction for contracts would be dominated by that for torts. The new decision in Wikingerhof reestablishes the equilibrium between the two. It clarifies that Article 7(2) Brussels I bis applies in cases of abuse of a dominant position, even those made by the conclusion of an unfavourable contract.

Indeed, violations of competition law are typical torts. It would be ill-advised to force the victim of such uncompetitive behaviour to sue at the place of performance foreseen in the contract because it is precisely this contract about which the victim complaints. The fact that the victim only pleads an abuse does not mean that one could disregard its complaint: For the purpose of establishing jurisdiction, the standard of proof has never been the same as that which applies for the merits of the case. It is for the court at the alleged place of abuse to find out whether the complaint is justified or not.

The new judgment in Wikingerhof does not break with the Brogsitter ruling, but is actually compatible with the latter. According to Brogsitter, a case is contractual in nature where the contractual provisions determine the outcome of the claim. Wikingerhof adds that this is only true where the contractual provisions are used as a normative standard, and not as factual proof of competitive misbehaviour. The delineation may be difficult to understand, but it is nonetheless necessary and reasonable.

The Italian publisher ESI has recently published a book titled EU Regulations 650/2012, 1103 and 1104/2016: Cross-Border Families, International Successions, Mediation Issues and New Financial Assets, edited by Sara Landini (University of Florence).

The papers, written in English, Italian, Portuguese and Spanish, address various issues relating to the Succession Regulation, the Matrimonial Property Regimes Regulation and the Regulation on the Property Consequences of Registered Partnership, notably as regards agreements between spouses and partners, agreements as to succession, forced heirship, succession to cryptocurrencies and mediation in cross-border succession and marital property cases.

The purpose of the book is to disseminate the results of the Goineu Plus project (Integration, migration, transnational relationships. Governing inheritance statutes after the entry into force of EU succession regulation), funded by the European Union.

The table of contents of the book can be found here. For more information, see here.

December 2020 will be quiet at the Court (regarding private international law cases).

The judgment in C-774/19 Personal Exchange International will be delivered (6th Chamber: Bay Larsen, Safjan, Jääskinen; no opinion, no hearing) on Thursday 10. The question was referred on September 5, 2019, by the Vrhovno sodišče Republike Slovenije (Slovenia):

Must Article 15(1) of Regulation No 44/2001 be interpreted as meaning that an online poker playing contract, concluded remotely over the internet by an individual with a foreign operator of online games and subject to that operator’s general terms and conditions, can also be classified as a contract concluded by a consumer for a purpose which can be regarded as being outside his trade or profession, where that individual has, for several years, lived on the income thus obtained or the winnings from playing poker, even though he has no formal registration for that type of activity and in any event does not offer that activity to third parties on the market as a paid service?

On Thursday 17, AG Campos Sánchez-Bordona’s opinion on C-709/19 Vereniging van Effectenbezitters, will be published. The Hoge Raad (the Netherlands) asked the Court to interpret once more Article 7(2) Brussels I bis in a case of patrimonial damage. The preliminary reference was lodged September 25, 2019; a hearing had been scheduled for last September, rescheduled, and eventually replaced by questions for written answer.

1.(a)  Should Article 7(2) of [the Brussels Ia Regulation] be interpreted as meaning that the direct occurrence of purely financial damage to an investment account in the Netherlands or to an investment account of a bank and/or investment firm established in the Netherlands, damage which is the result of investment decisions influenced by globally distributed but incorrect, incomplete and misleading information from an international listed company, constitutes a sufficient connecting factor for the international jurisdiction of the Netherlands courts by virtue of the location of the occurrence of the damage (‘Erfolgsort’)?

(b)    If not, are additional circumstances required to justify the jurisdiction of the Netherlands courts and what are those circumstances? Are the additional circumstances referred to [in paragraph 7 below] sufficient to found the jurisdiction of the Netherlands courts?

2. Would the answer to Question 1 be different in the case of a claim brought under Article 3:305a of the BW (Burgerlijk Wetboek: Netherlands Civil Code) by an association the purpose of which is to defend, in its own right, the collective interests of investors who have suffered damage as referred to in Question 1, which means, among other things, that neither the places of domicile of the aforementioned investors, nor the special circumstances of individual purchase transactions or of individual decisions not to sell shares which were already held, have been established?

3. If courts in the Netherlands have jurisdiction on the basis of Article 7(2) of the Brussels Ia Regulation to hear the claim brought under Article 3:305a of the BW, do those courts then, on the basis of Article 7(2) of the Brussels Ia Regulation, also have international and internal territorial jurisdiction to hear all subsequent individual claims for compensation brought by investors who have suffered damage as referred to in Question 1?

4. If courts in the Netherlands as referred to in Question 3 above have international, but not internal, territorial jurisdiction to hear all individual claims for compensation brought by investors who have suffered damage as referred to in Question 1, will the internal territorial jurisdiction be determined on the basis of the place of domicile of the misled investor, the place of establishment of the bank in which that investor holds his or her personal bank account or the place of establishment of the bank in which the investment account is held, or on the basis of some other connecting factor?

The hearing in C-30/20 Volvo e.a., also on Article 7(2) of the Brussels I bis Regulation, will be held on the same day. The preliminary reference, from a commercial court in Madrid (Spain), was lodged on January 22, 2020. It will be decided by the 1st Chamber (Bonichot, Bay Larsen, Toader, Safjan, Jääskinen, with M. Safjian as reporting judge), with the opinion of the French AG, M. Richard de la Tour. At first sight, the question looks like a simple one:

Should Article 7(2) of [the Brussels I bis Regulation] be interpreted as establishing only the international jurisdiction of the courts of the Member State for the aforesaid place, meaning that the national court with territorial jurisdiction within that State is to be determined by reference to domestic rules of procedure, or should it be interpreted as a combined rule which, therefore, directly determines both international jurisdiction and national territorial jurisdiction, without any need to refer to domestic regulation?

That the reference has been allocated to a chamber of five judges, together with the fact that the AG’s view has been requested, certainly means that the decision will go beyond choosing one or the other alternative interpretations.

Directive (EU) 2020/1828 of the European Parliament and of the Council of 25 November 2020 on representative actions for the protection of the collective interests of consumers and repealing Directive 2009/22/EC has been published today at the OJEU.

The text is attached to this post.

Vanessa Barbé (University of Valenciennes) and Christina Koumpli (University of Avignon) are inviting abstracts on The Impact of Brexit on Fundamental Rights and Freedoms for a Virtual Symposium on 27 and 28 May 2021, followed by a publication funded by the Centre for Interdisciplinary Research in Social Sciences and Humanities (CRISS, University of Valenciennes).

Some aspects of the call for papers dealing with rights resulting from the European Civil Justice and the rights of British litigants may be of particular interest for the readers of our blog.

Brexit is a political and legal earthquake with multiple consequences: on the European institutions, on the Member States and their budgets, on international trade, on British administrations and companies, but also on individuals, British or European nationals. The exit of the United Kingdom from the European Union has got a major impact on the fundamental rights and freedoms of individuals. The aim of this symposium is to identify the rights and freedoms which are called into question and to understand the potential and proven upheavals affecting their protection.

The impact of Brexit on rights and freedoms of European originis obvious: theoretically, the United Kingdom isn’t supposed to respect European citizens’ rights, workers’ rights, social rights, European environmental rights…. any longer. Admittedly, the country was already benefiting from an adaptation of its European obligations thanks to the policy selection mechanism (opt-out). But still the United Kingdom was a full member of the Union, applying the free movement of goods, persons, services and capital, and taking part in the Union’s founding policies on the environment or education, for instance. To some extent, the UK has pledged not to wipe out all the rights and freedoms formerly created, but their upholding cannot be total, as this would mean denying Brexit itself. Therefore, it would seem that several categories of rights and freedoms may be identified: those that risk to disappear completely (in relation to citizenship, for example), those that could be maintained because they are protected by other sources (international sources, regional sources such as the European Convention on Human Rights, or British legal sources such as common law), and those the future of which is uncertain, but which might be preserved by virtue of a ‘ratchet effect’ or of the principle of non-regression of rights.

The impact of Brexit on each of the four freedoms of movement might be considered, as well as on the categories of rights resulting from the implementation of the Union’s major policies in the fields of labour law, environmental law, health, education, justice and security in particular. Proposals are expected on the right to security related to the European arrest warrant, the right to privacy with regard to the protection of personal data, the right to non-discrimination in labour law, the right to a healthy environment, the right to asylum, etc… Cross-cutting categories of rights may be identified too, such as the rights of litigants, which can be considered by studying the remedies available to British litigants before domestic courts and European institutions after Brexit. The application of the Charter of Fundamental Rights in the United Kingdom’s legal order after Brexit is also a potential source of litigation, as the Court of Justice of the Union has recognised its applicability to a certain extent despite the opt-out declaration issued by the country.

In addition to rights and freedoms of European origin, British rights and freedoms are going to be affected too. Brexit, as a victory for the opponents of Europe in the broadest sense, might be, to some extent, a new opportunity to challenge the Human Rights Act 1998, the Act transposing the European Convention on Human Rights into British law. The future of that Act is uncertain after Brexit, since its repeal is being thought about, and the United Kingdom’s participation in the Council of Europe is being deeply questioned as well.

The political rights of the British citizens are also at the heart of the exit process. It took more than three and a half years after the referendum of June 23rd, 2016 for Brexit to be legally implemented by the British Parliament. Several ad hoc laws have been passed to delimit the powers of the Government and Parliament. The Supreme Court has been asked twice to rule on constitutional disputes arising from clashes between public authorities, and has been able consequently to assert itself as the third constitutional actor in Brexit. The powers and role of the British citizen/litigant may be usefully studied.

Finally, the territorial structure of the Kingdom is under threat. The border between Northern Ireland and the Republic of Ireland is at the heart of tensions between Europe and the United Kingdom, and with it, the question of the protection of the rights and freedoms of nationals of both States. In the same way, due to Scotland’s opposition to the exit procedure, the issue of the region’s independence is once again on the agenda. The Scottish First Minister Nicola Sturgeon is strongly advocating a new referendum on the independence of the region, which Boris Johnson formally ruled out in a letter of January 14th, 2020, since any (national or local) referendum must be authorised by Westminster. Furthermore, the political rights of the Scots, and their other constitutional rights could be disrupted as well, if the relationship between the region and the rest of the Kingdom was changed.

In conclusion, the symposium aims at exploring the multiple legal consequences, for the British and for European nationals, arising from the exit of the United Kingdom from the European Union.

Proposals for contribution (qualities of the author and short CV, summary of the communication of about one page) may relate to European law, British law, but also Private/ Public International law or the national laws of the Member States of the Union, as far as their relationships with the United Kingdom are considered.

The deadline for submissions is 15 January 2021.

Proposals are expected at the following address: Vanessa.Barbe@uphf.fr.

The new Evidence and Services Regulations were published at the OJEU of 2 December 2020:

__ Regulation (EU) 2020/1783 of the European Parliament and of the Council of 25 November 2020 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters (taking of evidence) (recast)

__ Regulation (EU) 2020/1784 of the European Parliament and of the Council of 25 November 2020 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters (service of documents) (recast)

They are attached to this post.

The European Commission adopted yesterday (2 December) “a package of initiatives to modernise the EU justice systems. The two main pillars of the new package are the Communication on the digitalisation of justice in the EU, and the new Strategy on European judicial training. This digital justice toolbox aims at further supporting Member States to move ahead their national justice systems towards the digital era and at improving EU cross-border judicial cooperation between competent authorities. As regards European judicial training, the Commission equips judges, prosecutors and justice professionals for the challenges of the 21st century, such as digitalisation. It further aims at promoting a common European judicial culture, based on the rule of law, fundamental rights and mutual trust”.

Extracts of the press release:

__ “Communication on the Digitalisation of Justice in the EU provides a toolbox to promote the use of digital tools by Member States […]:

Making digital the default option in cross-border judicial cooperation: To date, many judicial proceedings, including those that transcend borders, still take place with paper and by post. The European Commission will work on a legislative proposal to digitalise cross-border judicial cooperation procedures in civil, commercial and criminal matters. Adoption is planned for the end of 2021.

[…]

Better access to information: Electronic databases are easy to consult, they minimise costs for users and are resilient to crises. Therefore, Member States should strive to digitalise their registers and work towards their interconnections.

IT tools for cross-border cooperation: e-CODEX (e-Justice Communication via Online Data Exchange) is the main tool for secure cooperation in civil, commercial and criminal law proceedings across borders. To date, only some Member States use e-CODEX. With the adoption of today’s legislative proposal, the Commission aims to make e-CODEX the gold standard for secure digital communication in cross-border judicial proceedings in all Member States. As of 1 July 2023, the Commission entrusts this system to the Agency eu-LISA. Another digital tool is eEDES (e-evidence digital exchange system), which some Member States use to swiftly and securely exchange European Investigation Orders, mutual legal assistance requests and associated evidence in digital format instead of by post. With the legislative proposal adopted today, the Commission encourages all Member States to connect to eEDES. These IT tools will modernise EU justice systems and generate real European added-value”.

__ “EU Strategy on Judicial Training […]: by 2024, 65% of judges and prosecutors and 15% of lawyers shall be trained yearly on EU law. The strategy also supports justice professionals in the Western Balkans and in other EU partner countries, in Africa and Latin America. In addition, justice professionals will be able to look for training courses on EU law via the European Training Platform, launched today for a first test phase and planned to be fully operational in the course of 2021”.

Source: https://ec.europa.eu/commission/presscorner/detail/en/IP_20_2246

(with further documents)

On 2 December 2020, following a lengthy procedure, the Recast Service Regulation (Regulation (EU) 2020/1784 of 25 November 2020 on the service in the Member States of judicial and extrajudicial documents in civil or commercial matters) was finally published in the Official Journal of the European Union (the Position of the Council at first reading in view of the adoption of the Recast had appeared a few days earlier: see it here).

The contents of the Regulation were known, in substance, since an agreement was reached, in June 2020, between the Council and the European Parliament as a result of the trilogue consultations.

Previous posts in this blog illustrated the envisaged innovations and the challenges posed by the recast, and discussed some of the issues raised by the current rules.

The Recast will apply from 1 July 2022.

A book titled International Commercial Arbitration in the European Union, by Chukwudi Ojiegbe, has recently been published by Edward Elgar.

The blurb reads as follows:

This illuminating book contributes to knowledge on the impact of Brexit on international commercial arbitration in the EU. Entering the fray at a critical watershed in the EU’s history, Chukwudi Ojiegbe turns to the interaction of court litigation and international commercial arbitration, offering crucial insights into the future of EU law in these fields. Ojiegbe reviews a plethora of key aspects of the law that will encounter the aftermath Brexit, focusing on the implications of the mutual trust principle and the consequences for the EU exclusive competence in aspects of international commercial arbitration. He explores the principles of anti-suit injunction and other mechanisms that may be deployed by national courts and arbitral tribunals to prevent parallel court and arbitration proceedings. Advancing academic debate on the EU arbitration/litigation interface, this book suggests innovative solutions to alleviate this longstanding and seemingly intractable issue. Arriving at a time of legal uncertainty, this book offers crucial guidance for policymakers and lawyers dealing with the interaction of court litigation and international commercial arbitration in the EU, as well as academics and researchers studying contemporary EU and commercial law.

More information available here.

By Dr Sarah McKibbin

In the recent decision of RCD Holdings Ltd v LT Game International (Australia) Ltd,[1] Davis J of the Supreme Court of Queensland dismissed proceedings brought in breach of an exclusive jurisdiction clause that had been expressed in ‘an arm’s length agreement reached between commercial entities’.[2] In deciding whether to exercise his discretion not to stay or dismiss proceedings, Davis J examined whether procedural disadvantages and ‘inconvenience’ in the jurisdiction nominated in the clause were relevant considerations.

In 2013, the parties entered a contract setting up a scheme to promote a computer betting game at casinos in Melbourne, Nevada and Melbourne.[3] The contract, which was signed and to be partially performed in Australia, included a clause entitled ‘Governing Law’ by which the parties agreed that:[4]

any dispute or issue arising hereunder, including an alleged breach by any party, shall be heard, determined and resolved by an action commenced in Macau. The English language will be used in all documents.

A dispute arose and, notwithstanding the clause, the plaintiffs commenced proceedings in Queensland alleging breaches of the contract in connection with the scheme’s implementation at Crown Casino in Melbourne. The defendant, LT, entered a conditional appearance seeking to strike out the claim or, alternatively, have it stayed based on the exclusive jurisdiction clause. The plaintiffs’ submissions focused on the inconvenience of having to litigate in Macau and the perceived procedural advantages secured by LT in doing so.[5] The plaintiffs further submitted that the COVID-19 pandemic prevented them from commencing proceedings in Macau.[6]

The decision reinforces that ‘strong reasons’[7] are required to enliven the court’s discretion not to grant a stay of proceedings brought in breach of an exclusive jurisdiction clause. This reflects a fundamental policy consideration that ‘“parties who have made a contract should be kept to it”’.[8] Here, the parties differed on the circumstances relevant to the exercise of this discretion.[9] The plaintiffs relied upon the list of circumstances identified by Brandon J in The Eleftheria, which included ‘the relative convenience and expense of the trial’ and ‘[w]hether the plaintiffs would be prejudiced by having to sue in the foreign court’.[10]  As Davis J marked, subsequent English and Australian decisions have questioned the role of procedural disadvantages and inconvenience in the nominated jurisdiction, ‘at least when they are factors which should have been known at the time the exclusive jurisdiction clause was agreed.’[11]

In that respect, Davis J followed the judgment of Bell P in the recent New South Wales Court of Appeal decision of Australian Health & Nutrition Association Ltd v Hive Marketing Group,[12] which endorsed the critical observations of Allsop J in Incitec Ltd v Alkimos Shipping Corp[13] and Waller J in British Aerospace plc v Dee Howard Co.[14] In Incitec, Allsop J perceived ‘financial and forensic inconvenience’ to the party bound by the clause to be the direct consequence of the bargain entered.[15] In a similar vein, Waller J in British Aerospace considered that these factors ‘would have been eminently foreseeable at the time that [the parties] entered into the contract’.[16]

Setting issues of ‘inconvenience’ to one side, however, Davis J attached greater significance to the fact that the parties upon contracting presumably ‘considered the commercial wisdom of agreeing’ to the inclusion of the clause.[17] The factors relied upon by the plaintiffs were in existence and could have been taken into account by the parties at the time of contracting.[18] Indeed, evidence demonstrated that the courts of Macau: (1) could deal with the claim; (2) could provide the remedy sought by the plaintiffs; and (3) would accept court documents in the English language.[19] Issues of inconvenience ‘can hardly be weighty in the exercise of discretion where one party seeks to deny the other the benefit of the covenant.’[20] Finally, Davis J observed that ‘there is little, if any, evidence at all as to the impact of the pandemic upon any litigation in Macau’.[21] Yet, ‘if the pandemic developed so as to effectively prevent, or unduly frustrate’ litigation in Macau, this discretionary consideration would be taken into account together with ‘any other relevant considerations’ in a subsequent application.[22]

[1] [2020] QSC 318.

[2] Ibid, [56].

[3] Davis J observes that ‘[t]he scheme is clearly to be targeted at casinos throughout the world’: at para [7].

[4] RCD Holdings (n 1) [8].

[5] Ibid, [54].

[6] Ibid, [33].

[7] Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197, 259 (Gaudron J). Akai Pty Ltd v People’s Insurance Co Ltd (1996) 188 CLR 418, 429 (Dawson and McHugh JJ), 445 (Toohey, Gaudron and Gummow JJ).

[8] Ibid, quoted in RCD Holdings (n 1) [57].

[9] Ibid, [58].

[10] Ibid.

[11] See, eg, British Aerospace plc v Dee Howard Co [1993] 1 Lloyd’s Rep 368; Incitec Ltd v Alkimos Shipping Corp (2004) 138 FCR 496, 506; Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd (2019) 99 NSWLR 419.

[12] Australian Health & Nutrition (n 7).

[13] (2004) 138 FCR 496, 506 [49].

[14] [1993] 1 Lloyd’s Rep 368, 376.

[15] Incitec Ltd v Alkimos Shipping Corp (n 11) 506 [49].

[16] British Aerospace plc v Dee Howard Co (n 12) 376.

[17] RCD Holdings (n 1), [65].

[18] Ibid.

[19] Ibid, [32].

[20] Ibid, [65].

[21] Ibid, [70].

[22] Ibid.

Guest post by Ulla Liukkunen, Professor of Labour Law and Private International Law at the University of Helsinki and Director of the Finnish Center of Chinese Law and Chinese Legal Culture

The International Academy of Comparative Law launched a new open access publication in November 2020. Volume no 1 on the use of comparative law methodology in international arbitration contains articles by Emmanuel Gaillard, Sebastián Partida, Charles-Maurice Mazuy, S.I. Strong, Johannes Landbrecht, Morad El Kadmiri, Marco Torsello, Ulla Liukkunen, Alyssa King, Alexander Ferguson, Dorothée Goertz and Luis Bergolla as well as introductory remarks on the topic by the Secretary-General of the Academy, Diego P. Fernández Arroyo.

The volume no 1 is available on aidc-iacl.org/journal.

The article “Chinese context and complexities — comparative law and private international law facing new normativities in international commercial arbitration” was written by Ulla Liukkunen, Professor of Labour Law and Private International Law at the University of Helsinki and Director of the Finnish Center of Chinese Law and Chinese Legal Culture.

Professor Liukkunen examines international commercial arbitration from the perspective of Chinese developments, noting that, in global terms, the organization of cross-border dispute resolution is changing as a part of the Belt and Road Initiative (BRI) development. With the BRI, Chinese interest in international commercial arbitration has gained a new dimension as BRI promotes the expansion of Chinese dispute resolution institutions and their international competitiveness.

According to Liukkunen, these developments challenge the current narrative of international arbitration. She explores private international law as a framework for unfolding noteworthy characteristics of the Chinese legal system and legal culture that are present in international commercial arbitration and can be linked to an assessment of the role of the BRI in shaping the arbitration regime. A rethink of comparative methodology is proposed in order to promote an understanding of Chinese law in the arbitration process.

Moreover, Liukkunen argues that considerations of the Chinese private international law and arbitration regime speak for a broader comparative research perspective towards international commercial arbitration. In the international commercial arbitration frame under scrutiny, we can see the conception of party autonomy placed in a Chinese context where the state is shaping the still relatively young private international law frame for exercise of that freedom and certain institutional structures are advocated where party autonomy is placed. Chinese development underlines the connection between the legal regime of arbitration and endeavours by the state, thereby requiring assessment of party autonomy from the perspective of the regulatory framework of private international law that expresses the complex dichotomy between private and public interests.