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Written by Stephen Armstrong, lawyer practicing in Toronto, Ontario, Canada with an interest in international arbitration. [Linkedin]

On Friday, October 9, 2020, the United Kingdom Supreme Court released an interesting decision concerning the applicable law governing arbitration agreements in international contracts and the jurisdiction of the courts of the seat of the arbitration to grant anti-suit injunctions. The case is Enka Insaat Ve Sanayi A.S. v 000 Insurance Company Chubb, [2020] UKSC 38.

The full text of the Supreme Court’s decision is available here.

A digestible summary of the case, including the facts, the breakdown of votes, and the reasons, is available here.

Interestingly, the Supreme Court fundamentally disagreed with the Court of Appeal on the role of the seat of the arbitration for determining the law of the arbitration agreement. The Supreme Court held that an express choice of law in the main contract should be presumptively taken as an implied choice of law governing the arbitration agreement. By contrast, the Court of Appeal had held that the law of the seat was the parties’ presumptive implied choice of law for the arbitration agreement. The Supreme Court did, however, affirm the Court of Appeal’s holding that the courts of the seat are always an appropriate forum to grant an anti-suit injunction, regardless of the applicable law.

Unlike other choice of law issues in the UK, this issue is governed by the common law, rather than the EU’s Rome I regulation. This makes the Supreme Court’s decision a common law authority, rather than an EU law authority. I therefore expect that this decision will find purchase throughout the Commonwealth, including my home jurisdiction of Ontario, Canada.

The German Bundesgerichtshof (BGH) in August finally decided the case “Sahyouni” that made it twice to the ECJ (Sahyouni I  and Sahyouni II). The BGH decision (German text here) applied the new German rules on private divorces. The German legislator had enacted these rules after the ECJ declared the Rome III Regulation as only applicable on divorces by a court. Additionally, the court took the opportunity to comment on several other private international law issues. The probably most interesting issues of the case are (1) the new German rules, (2) the treatment of parties with more than one nationality if the connecting factor is nationality and (3) the question whether the unilateral private divorce finally was recognized.

1. German law regarding “private divorces”

Following the second “Sahyouni” decision, new private international law rules were enacted. German private international law follows the principle of “recognition via conflict of laws”, meaning that a divorce not issued by a court decision will only be recognized if it complies with the rules applicable according to German private international law. The new rules basically declared the Rome III Regulation applicable to private divorces mutatis mutandis except for those rules that could not be applied on a private divorce (e.g. the application of lex fori as there is not forum). Furthermore, Article 10 Rome III, the rule that initially triggered the request for the preliminary ruling, is not applicable. Thus, only the “usual” public policy exception can prevent the application of the lex causae.

1. Treatment of double-nationality

The court came to the conclusion that the spouses did not have a common habitual residence as required by Article 8 lit a, b Rome III (mutatis mutandis). So, the question occurred whether the spouses had a common nationality (Article 8 lit. c). In this special case, both spouses did not only have one common nationality but two: German and Syrian. As the Rome III regulation is silent to the treatment of double-nationals (and, furthermore, Rome III only applied mutatis mutandis), the court applied Article 5 para. 1 EGBGB (English non-official translation here). This rule provides in case of double-nationality (1) a prevalence of the German nationality and (2), if no German nationality is in play, a prevalence of the “effective” nationality, ie the nationality that is closer connected to the person, usually the one of habitual residence. In the context of EU private international law, there was a discussion whether these two rules can hold – given that in Garcia Avello and Haddadi similar rules had been regarded as violating EU primarily law, esp. the principle of non-discrimination.

In “Sahyouni” the BGH concluded that both cases were not relevant. The second (and probably non-effective) nationality of both spouses was the Syrian, a non-EU nationality. Thus, the principle of non-discrimination did not apply. Therefore, German law applied on the case. German law does not allow a “private divorce”. For that reason, the divorce was regarded as invalid in Germany.

1. Unilateral divorces and public policy

Finally, the court took the opportunity to mention that the poblic policy exception also would have made the divorce invalid: Article 10 Rome III was not applicable, thus, Article 6 EGBGB (English) would have applied. Contrary to Article 10, Article 6 requires an analysis of the concrete result of the application of the lex causae to determine whether this result violates fundamental principles/values of the German legal system. In Germany, divorces by unilateral declarations (such as talaq or ghet) can be regarded as not violating the German ordre public, especially if both spouses agree on the divorce. From the facts of the case the BGH concluded that in “Sahyouni” the wife did not wish for divorce. For that reason, the recognition of the unilateral declaration would violate the German public policy (“would” as this argument was not decisive for the case – as aforementioned, German law applied).

Written by Giesela Rühl, Humboldt-University of Berlin

 

The protection of human rights in global supply chains has been high on the agenda of national legislatures for a number of years. Most recently, also the European Union has joined the bandwagon. After Commissioner for Justice Didier Reynders announced plans to prepare a European human rights to due diligence instrument in April 2020, the JURI Committee of the European Parliament has now published a Draft Report on corporate due diligence and corporate accountability. The Report contains a motion for a European Parliament Resolution and a Proposal for a Directive which will, if adopted, require European companies – and companies operating in Europe – to undertake broad mandatory human rights due diligence along the entire supply chain. Violations will result, among others, in a right of victims to claim damages.

The proposed Directive is remarkable because it amounts to the first attempt of the European legislature to establish cross-sectoral mandatory human rights due diligence obligations coupled with a mandatory civil liability regime. However, from a private international law perspective the Draft Report attracts attention because it also contains proposals to change the Brussels Ia Regulation and the Rome II Regulation. In this post I will briefly discuss – and criticize – the proposed changes to the Rome II Regulation. For a discussion of the changes to the Brussels Ia Regulation I refer to Geert Van Calster’s thoughts on GAVC.

Victims’ unilateral right to choose the applicable law

The proposed change to the Rome II Regulation envisions the introduction of a new Article 6a entitled “Business-related human rights claims”. Clearly modelled on Article 7 Rome II Regulation relating to environmental damage the proposal allows victims of human rights violations to choose the applicable law. However, unlike Article 7 Rome II Regulation, which limits the choice to the law of the place of injury and the law of the place of action, the proposed Article 6a allows victims of human rights violations to choose between potentially four different laws, namely

1) the law of the country in which the damage occurred, i.e. the law of the place of injury,

2) the law of the country in which the event giving rise to damage occurred, i.e. the law of the place of action,

3) the law of the country in which the parent company has its domicile or, where the parent company does not have a domicile in a Member State,

4) the law of the country where the parent company operates.

The rationale behind the proposed Article 6a Rome II Regulation is clear: The JURI Committee tries to make sure that the substantive provisions of the proposed Directive will actually apply – and not fall prey to Article 4(1) Rome II Regulation which, in typical supply chain cases, leads to application of the law of the host state in the Global South and, hence, non-EU law. By allowing victims to choose the applicable law, notably the law  of the (European) parent company, the JURI Committee takes up recommendations that have been made in the literature over the past years.

However, a right to choose the applicable law ex post – while certainly good for victims – is conceptually ill-conceived because it results in legal uncertainty for all companies that try to find out ex ante what their obligations are. Provisions like the proposed Article 6a Rome II Regulation, therefore, fundamentally impair the deterrence function of tort law and increase compliance costs for companies because they have to adjust their behaviour to four – potentially – different laws to avoid liability. It is for this reason that choice of law rules that allow one party to unilaterally choose the applicable law ex post have largely (even though not completely) fallen out of favour.

Alternative roads to European law

The proposed Article 6a Rome II Regulation, however, does not only fail to convince conceptually. It also fails to convince as regards to the purpose that it seeks to achieve. In fact, there are much better ways to ensure that European standards apply in supply chain cases. The most obvious way is to simply adopt the envisioned European instrument in the form of a Regulation. Its provisions would then have to be applied as international uniform law by all Member State courts – irrespective of the provisions of the Rome II Regulation. However, even if the European legislature prefers to adopt a European instrument in the form of a Directive – for political or competence reasons –, no change of the Rome II Regulation is necessary to ensure that it is applied throughout Europe. In fact, its provisions can simply be classified as overriding mandatory provisions in the meaning of Article 16 Rome II Regulation. The national provisions implementing the Directive will then apply irrespective of the otherwise applicable law.

In the light of the above, application of European human rights due diligence standards can be ensured without amending the Rome II Regulation. It is, therefore, recommended that the JURI Committee rethinks – and then abandons – the proposed Article 6a Rome II Regulation.

 

Note: This post is also available via the blog of the European Association of Private International Law.

This post was written by Giesela Rühl, LL.M. (Berkeley), Humboldt-University of Berlin.

The protection of human rights in global supply chains has been high on the agenda of national legislatures for a number of years. Most recently, also the European Union has joined the bandwagon. After Commissioner for Justice Didier Reynders announced plans to prepare a European human rights to due diligence instrument in April 2020, the JURI Committee of the European Parliament has now published a Draft Report on corporate due diligence and corporate accountability. The Report contains a motion for a European Parliament Resolution and a Proposal for a Directive which will, if adopted, require European companies – and companies operating in Europe – to undertake broad mandatory human rights due diligence along the entire supply chain. Violations will result, among others, in a right of victims to claim damages.

The proposed Directive is remarkable because it amounts to the first attempt of the European legislature to establish cross-sectoral mandatory human rights due diligence obligations coupled with a mandatory civil liability regime. However, from a private international law perspective the Draft Report attracts attention because it also contains proposals to change the Brussels I bis Regulation and the Rome II Regulation. In this post I will briefly discuss – and criticize – the proposed changes to the Rome II Regulation. For a discussion of the changes to the Brussels I bis Regulation I refer to Geert Van Calster’s thoughts on GAVC.

Victims’ Unilateral Right to Choose the Applicable Law

The proposed change to the Rome II Regulation envisions the introduction of a new Article 6a entitled “Business-related human rights claims”. Clearly modelled on Article 7 Rome II Regulation relating to environmental damage the proposal allows victims of human rights violations to choose the applicable law. However, unlike Article 7 Rome II Regulation, which limits the choice to the law of the place of injury and the law of the place of action, the proposed Article 6a allows victims of human rights violations to choose between potentially four different laws, namely

1) the law of the country in which the damage occurred, i.e. the law of the place of injury,

2) the law of the country in which the event giving rise to damage occurred, i.e. the law of the place of action,

3) the law of the country in which the parent company has its domicile or, where the parent company does not have a domicile in a Member State,

4) the law of the country where the parent company operates.

The rationale behind the proposed Article 6a Rome II Regulation is clear: The JURI Committee tries to make sure that the substantive provisions of the proposed Directive will actually apply – and not fall prey to Article 4(1) Rome II Regulation which, in typical supply chain cases, leads to application of the law of the host state in the Global South and, hence, non-EU law. By allowing victims to choose the applicable law, notably the law of the (European) parent company the JURI Committee takes up recommendations that have been made in the literature over the past years.

However, a right to choose the applicable law ex post – while certainly good for victims – is conceptually ill-conceived because it results in legal uncertainty for all companies that try to find out ex ante what their obligations are. Provisions like the proposed Article 6a Rome II Regulation, therefore, fundamentally impair the deterrence function of tort law and increase compliance costs for companies because they have to adjust their behaviour to four – potentially – different laws to avoid liability. It is for this reason that choice of law rules that allow one party to unilaterally choose the applicable law ex post have largely (even though not completely) fallen out of favour.

Alternative Roads to European law

The proposed Article 6a Rome II Regulation, however, does not only fail to convince conceptually. It also fails to convince as regards to the purpose that it seeks to achieve. In fact, there are much better ways to ensure that European standards apply in supply chain cases. The most obvious way is to simply adopt the envisioned European instrument in the form of a Regulation. Its provisions would then have to be applied as international uniform law by all Member State courts – irrespective of the provisions of the Rome II Regulation. However, even if the European legislature prefers to adopt a European instrument in the form of a Directive – for political or competence reasons –, no change of the Rome II Regulation is necessary to ensure that it is applied throughout Europe. In fact, its provisions can simply be classified as overriding mandatory provisions in the meaning of Article 16 Rome II Regulation. The national provisions implementing the Directive will then apply irrespective of the otherwise applicable law.

In the light of the above, application of European human rights due diligence standards can be ensured without amending the Rome II Regulation. It is, therefore, recommended that the JURI Committee rethinks – and then abandons – the proposed Article 6a Rome II Regulation.

The members of the European Association of Private International Law have recently received, by e-mail, the first issue of the Association’s Newsletter.

The issue can now be accessed by all readers of this blog here.

It comes with updates on the EAPIL conference in Aarhus, which is scheduled to take place on 27, 28 and 29 May 2020, and with news on the activities of the Association, notably the creation of a Working Group on the Feasibility of a European Private International Law Act, chaired by Thomas Kadner Graziano, and the establishment of the Young EU Private International Law Research Network, co-chaired by Martina Melcher and Tamás Szabados.

The Newsletter also provides a presentation of four more Working Groups whose creation has recently been proposed: a Working Group on Interests in European private international law, led by Caroline Kleiner; one on The law applicable to the validity of choice of court agreements, coordinated by Laurence Usunier and Eva Lein; one on Liberalizing the cross-border taking of evidence within the EU, proposed by Gilles Cuniberti; and one on A future European Regulation on international property law, headed by Eva-Maria Kieninger.

The members of the Association are warmly encouraged to contribute to the above activities, or launch new ones!

One of the articles in the Newsletter is about this blog. The blog is seeking new permanent editors and a social media manager. Interested EAPIL members are invited to get in touch with Pietro Franzina at pietro.franzina@unicatt.it.

Finally, the Newsletter provides an account of the current status of the EAPIL membership, less than one year after its creation. The Association has now 216 members, coming from 40 countries around the world.

This issue’s guest editorial is by Patrick Kinsch, Secretary General of GEDIP (Groupe européen de droit international privé), and is titled Fraternal greetings from a fellow association of European private international law.

The ‘transparency’ or ‘notification’ Directive 2015/1535 (the successor to Directive 98/34) featured twice at the CJEU yesterday. In Case C‑711/19 Admiral Sportwetten, the Court held that a national tax rule that provides for taxation of the operation of betting terminals does not constitute a ‘technical regulation’ that needs to be notified under the Directive. In Case C-514/19 Union des industries de la protection des plantes it held more directly than Kokott AG had opined, that France had validly informed the Commission of the need to take measures intended, in particular, to protect bees by banning the use of 3 active substances of the neonicotinoid family which had been authorised for use under the relevant EU procedure. That procedure is regulated by Directive 1107/2009 on plant protection products.

The complication in the case in essence is a result of the dual procedure for national safeguard measures as a result of the existence of both the PPP and the notification Directive. May a communication of a Member State under the Notification Directive, double as notification of emergency measures under the PPP Directive? The CJEU held it can, provided the notification contains a clear presentation of the evidence showing, first, that those active substances are likely to constitute a serious risk to human or animal health or to the environment and, second, that that risk cannot be controlled without the adoption, as a matter of urgency, of the measures taken by the Member State concerned, and where the Commission failed to ask that Member State whether that communication must be treated as the official provision of information under the regulation.

The Court referred to its findings in C-116/16 Fidenato, that a Member State’s power, provided by an EU act, to adopt emergency measures requires compliance with both the substantive conditions and procedural conditions laid down by that act (a requirement, I would add, which conversely also applies to the European Commission), but adds that a notification to the Commission under Article 71(1) of Regulation 1107/2009 requires only that the Member State concerned ‘officially informs’ that institution, without having to do so in a particular manner.

More generally, the Court emphasises the principle of sound administration imposed upon the EC, which explains its insistence on the EC having proactively to ensure the Member State concerned be aware of its obligations under the EU law concerned or indeed adjacent law. A certain parallel here may be made with the rules of civil procedure which require from those soliciting the courts that they approach the court with clean hands.

The Court in essence, I submit, finds that, the consequences for the Member State concerned in failing to meet the requirements for it to be able to make use of a safeguard provision in secondary law being so great, the conditions imposed on them must be met by a strict due diligence on behalf of the European Commission.

Of note is that the judgment does not entail any finding on the substantive legality of the French ban.

Geert.

 

 

A foreign judgment is generally not to be reviewed on the merits at the recognition and enforcement stage. Yet, an exception has always been carved out for fraud under the common law rules on the basis that ‘fraud unravels everything’ (Lazarus Estates Ltd v Beasley [1956] 1 QB 702, 712 per Lord Denning). Thus, English courts allow a judgment debtor to raise fraud at the recognition and enforcement stage even if no new evidence is adduced and fraud had been considered and dismissed by the court of origin (Abouloff v Oppenheimer & Co (1882) 10 QBD 295). This seeming anomaly with the prohibition against a review of the merits of a foreign judgment has been justified on the basis that where fraud is concerned, the court of origin is misled, not mistaken (Abouloff). The Abouloff rule has been much criticized, but successive courts have refused to depart from it (see also Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd [2011] UKPC 7, [2012] 1 WLR 1804, [116] (Privy Council)). Further, in Takhar v Gracefield Developments Ltd ([2019] UKSC 13, [2020] AC 450) which is a case on fraud and domestic judgments, the Supreme Court held that, generally, no requirement that the fraud could not have been uncovered with reasonable diligence in advance of obtaining the judgment would be imposed on the party seeking to set aside the judgment on the basis of fraud. As one of the oft-cited criticisms for the Abouloff rule is that it is out of step with how English courts deal with domestic judgments, Takhar may have the effect of further embedding the Abouloff rule.

In Hong Pian Tee v Les Placements Germain Gauthier ([2002] SGCA 17, [2002] 1 SLR(R) 515), the Singapore Court of Appeal criticized the Abouloff rule on the basis that it would encourage ‘endless litigation’ and ‘judicial chauvinism’ (at [27]-[28]). Drawing on Canadian and Australian authorities on fraud and foreign judgments, the Court held that insofar as intrinsic fraud (ie, fraud which goes to the merits of the case) is concerned, the foreign judgment may only be impeached where ‘fresh evidence has come to light which reasonable diligence on the part of the defendant would not have uncovered and the fresh evidence would have been likely to make a difference in the eventual result of the case’ (at [30]).

The current position on fraud and domestic judgments under Singapore law is that the fresh evidence rule applies, albeit flexibly (see, eg, Su Sh-Hsyu v Wee Yue Chew [2007] SGCA 31, [2007] 3 SLR(R) 673). However, the Court of Appeal recently considered Takhar in a decision concerning a domestic adjudication determination (AD). Adjudication is available under the Building and Construction Industry Security of Payment Act (Cap 30B, Rev Ed 2006) and is a quick and inexpensive process to resolve payment disputes arising from building and construction contracts. In Facade Solution Pte Ltd v Mero Asia Pacific Pte Ltd ([2020] SGCA 88), the Court of Appeal held that an AD could be set aside on the ground of fraud. The party raising fraud would have to establish that the facts which were relied on by the adjudicator were false; that the other party either knew or ought reasonably to have known them to be false; and that the innocent party did not in fact, subjectively know or have actual knowledge of the true position throughout the adjudication proceedings (at [30]). The Court emphasised that ‘there is no requirement on the innocent party to show that the evidence of fraud could not have been obtained or discovered with reasonable diligence during the adjudication proceeding’ (at [31]). It cited Takhar and the High Court of Australia decision of Clone Pty Ltd v Players Pty Ltd (in Liquidation) [2018] HCA 12 with approval, the High Court of Australia having also rejected the reasonable diligence requirement in the context of a fraudulently obtained domestic judgment in the latter case.

The Court held (at [33]; emphasis added):

‘Where it is established that an AD is infected by fraud, it is neither material nor relevant to inquire as to whether the innocent party could have discovered the truth by the exercise of reasonable diligence. A fraudulent party cannot be allowed to claim that he could have been caught had reasonable diligence been exercised, but because he was not caught, he should be allowed to get away with it. Such a view would bring the administration of justice into disrepute and it would be unprincipled to hold in effect that there is no sanction on the fraudulent party because he could have been found out earlier. Parties dealing with the court, and in the same vein, with the adjudicator in the adjudication of their disputes under the Act are expected to act with utmost probity.’

This passage suggests that the position on fraud and domestic judgments would change in the near future. It also raises the question whether the requirement of reasonable diligence in respect of intrinsic fraud and foreign judgments would survive for long. On the one hand, the Court in Hong Pian Tee had said that: ‘There is no logical reason why a different rule should apply in relation to a foreign judgment’ (at [27]) (ie, vis-à-vis a domestic judgment). The requirement of reasonable diligence has also been criticized on the basis that the court would be ‘taking the side of the fraudster against his negligent opponent’ (Briggs, ‘Crossing the River by Feeling the Stones; Rethinking the Law on Foreign Judgments’ (2005) 8 SYBIL 1, 21). On the other hand, there was a heavy emphasis on judicial comity in Hong Pian Tee. The Court observed that: ‘It is … vitally important that no court of one jurisdiction should pass judgment on an issue already decided upon by a competent court of another jurisdiction …. It must be borne in mind that the enforcement forum is not an appellate tribunal vis-à-vis the foreign judgment’ (at [28]).

It remains to be seen whether the Singapore Court of Appeal would in future resile from Hong Pian Tee. At least, the recent developments in the domestic context intimate that the point is arguable.

On few occasions Polish tax authorities made references to the EU Succession Regulation and applied foreign law designated by its provisions, even though revenue and other administrative matters are explicitly excluded from its scope. This post presents shortly the inheritance taxation rules in Poland, explains why tax authorities felt the need to look into foreign succession laws for tax purposes and how the content of foreign law was ascertained.

Exclusion of Taxes from the scope of the EU Succession Regulation

The EU Succession Regulations states in its Article 1(1) that it does not apply to revenue, customs or administrative matters. Recital 10 makes reference to taxes in particular. It explains that it is for national law to determine how taxes are calculated and paid. The question is how to proceed if national tax law makes a direct reference to succession law concepts.

It might be reminded that inheritance taxes in Member States were once subject to an EU-sponsored study (which might be consulted here).

Inheritance Taxation in Poland

Inheritance taxation in Poland is regulated by a separate statute (available here – in Polish only). It provides that the acquisition of goods located in Poland and rights exercised in Poland by an individual as a result of inter alia succession is subject to taxation. Acquisition of goods located abroad or rights exercised abroad is subject to taxation, provided that at the moment of opening of the succession the beneficiary was a Polish national or had habitual residence in Poland. The acquisition of ownership of movable property located in Poland or rights exercised in Poland is not subject to taxation, provided that neither the beneficiary, nor deceased were Polish nationals and had habitual residence in Poland.

There are numerous exemptions from inheritance tax, including the one for the closest family members. The beneficiary is the taxpayer. The tax point arises at the moment of the acceptance of the succession. If the acquisition was not reported to tax authorities the tax point (re)arises at the moment when a document in writing is produced. If it is a court decision the tax point arises at the moment the decision becomes final. The tax base is the net worth of the estate calculated in the prescribed manner. The tax due depends on the degree of affinity or kinship between the deceased and beneficiary and varies between 3% to 20% of the tax base exceeding certain thresholds. Taxpayers are obliged to file a tax return, based on which tax authorities issue a decision indicating tax to be paid.

Tax Point Linked to the Acceptance of the Succession

As mentioned above, the tax point with respect to succession arises at the moment of its acceptance. This clearly refers to the acceptance of the succession, an institution known in the substantive succession law regulated by the Polish Civil Code (here). It states that an heir acquires the estate at the moment of the opening of the succession. Nevertheless, the heir may accept the estate without limitation of liability for debts, with limitation of that liability or may renounce the succession. The time limit for such statement is six months counting from the moment when an hair have learned about his/her title of acquisition.

It is simple to indicate a tax point for inheritance taxation in a purely domestic case. However, inheritance taxation comes into play also in cases which are less intensively connected to Poland. For example, acquisition of an immovable property located in Poland is taxed, even if both the deceased and the beneficiary are foreign nationals with habitual residence abroad. In those cases, in accordance with the EU Succession Regulation, succession is governed by foreign law. The doubt as to the tax point might occur in instances when lex successionis does not know the concept of an acceptance of succession.

Acceptance of Succession when Foreign Law is Applicable

While assessing the tax point tax authorities stated that the concept of an acceptance of succession used for tax purposes must take into account the law applicable to civil law aspects of the particular case. This law should be designated in accordance with the EU Succession Regulation.

In the recent tax ruling of 27 August 2020 (signature: 0111-KDIB2-3.4015.112.2020.1.AD) the tax authority analysed English law (as the deceased was habitually resident in the UK). It was explained that in the UK succession case is dealt with differently than in Poland. It is an appointed executor, who is responsible for assessing the value of the estate, payment of debts and payment of inheritance taxes in the UK. The executor is responsible also for sending documents to the probate court. Once the decision of the probate court is delivered, the estate might be transferred to heirs. As a result a final decision of the probate court may be perceived as an equivalent to the acceptance of succession. In an earlier tax ruling of 31 December 2019 (signature: 0111-KDIB4.4015.114.2019.2.MD) the tax authority analysed US succession procedure and also stated that the decision of the court is conclusive for tax purposes in Poland.

Please note that the above are not decisions in particular tax proceedings, but tax rulings, which only interpret the law on the taxpayer’s application and are issued based on information and explanations provided by the taxpayer. Hence, while issuing a tax rulings tax authorities are not establishing the content of foreign law. Tax rulings may be found by their signatures in the public database (accessible here – in Polish only).

Ascertainment of the Content of Foreign Law

In the tax proceeding concerning succession governed by Australian law tax authorities went even further and lined the tax point to the actual transfer of funds from Australia to Poland. The taxpayer was arguing that the tax point have arisen earlier, at the moment of the opening of succession (as the foreign exchange rate used for calculating tax due was more favourable at that time). The decision resulted in a dispute and the tax decision was appealed to the administrative court. The court in its judgement of 26 June 2018 (signature: I SA/Wr 164/18; it may be found by its signature in the public database here – in Polish) set aside the tax decision due to procedural faults, in particular when it comes to ascertainment of the content of foreign law.

The court stated that it is not enough that the tax authorities have asked Polish Consulate in Sidney for information on Australian law and that the decision has indicated provisions of the South Australia Administration and Probate Act 1919 as the basis for conclusions. The court suggested that indeed the tax point arose earlier than at the moment of the bank transfer, but in order to indicate this moment a careful analysis of Australian succession law must be made. For this purpose tax authorities should ask Ministry of Finance for guidance, which might in turn, within the framework of legal aid procedure, contact Australian tax authorities. Australian succession law should be applied as it would be applied by Australian tax authorities in similar cases. Also an expert witness may be appointed.

The above shows the relevance of private international law for the work of administrative authorities, influence of lex successions designated by the EU Succession Regulation on tax matters, but also reveals that tax authorities are not necessarily competent to proceed with the ascertainment of the content of foreign law.

5 pm Argentinian time.
Registration here.

The US Supreme Court will hear oral arguments today (7-Oct-2020) concerning two consolidated cases: Ford Motor Co. v. Montana Eighth Judicial District Court and Ford Motor Co. v. Bandemer. The consolidated cases deal with the difficult issue of personal jurisdiction over a non-resident defendant, where there is a split in federal courts of appeals and state courts of last resort. These cases are significant because they will have a direct impact on the ease with which plaintiffs can lodge a complaint in product liability cases against big automobile companies (and others) before the courts of their own state. In a nutshell, it can be argued that besides jurisdictional matters relating to the defendant, these cases deal with fundamental notions of access to justice for consumers.

The oral argument was originally scheduled for April 2020 but given the Covid-19 pandemic was rescheduled for the October 2020 term. Please note that the Supreme Court can hear oral arguments even though they are currently only 8 justices. According to Rule 4 of the Supreme Court of the United States, six Members of the Court constitute a quorum. Nevertheless, complications may arise if there is a 4-4 split during the deliberations. Given the great experience and expertise of Justice Ginsburg in this area (see our previous post here), it is a pity that she could not partake in this oral argument and decision, and she will be greatly missed.

Below I include the question presented. More information will follow soon, stay tuned!

Petition for a writ of certiorari on behalf of Ford Motor Company

“The Due Process Clause permits a state court to exercise specific personal jurisdiction over a non-resident defendant only when the plaintiff’s claims “arise out of or relate to” the defendant’s forum activities. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985) (internal quotation marks omitted).”

The question presented is:

“Whether the “arise out of or relate to” requirement is met when none of the defendant’s forum contacts caused the plaintiff’s claims, such that the plaintiff’s claims would be the same even if the defendant had no forum contacts.”

Hélène Péroz (University of Nantes) has edited a commentary of Regulation (EU) 2016/1191 of 6 July 2016 on promoting the free movement of citizens by simplifying the requirements for presenting certain public documents in the European Union, published by Bruylant (La circulation européenne des actes publics – Premier commentaire du Règlement 2016/1191 du 6 juillet 2016).

More generally, the book addresses the different issues arising from the international circulation of public documents in Europe, both from a practical and an academic perspective.

The book’s table of contents can be found here. See here for further information.

PJSC Tatneft v Bogolyubov & Ors [2020] EWHC 2437 (Comm) is another example of a case where privilege is firmly considered to be subject to lex fori, like in the New York courts but unlike the approach of the Dutch courts. Moulder J did discuss the extent to which the rule applies to foreign unregistered, in-house lawyers. However she does this purely from the English point of view and without any consideration of either Rome I or Rome II. That is not very satisfactory in my view. As I have signalled before, one can discuss whether privilege is covered by the evidence and procedure exception in the Rome Regulations, however it must be discussed and cannot be just brushed under the carpet.

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 3, Chapter 4.

(3rd ed forthcoming February 2021).

 

The German Working Group of Young Scholars in Public International Law (Arbeitskreis junger Völkerrechtswissenschaftler*innen – AjV) asked me to forward the following call for papers. This conference intends to bridge the gap between international public and private international law, thus, contributions from private international law are more than welcome. The official call is on this website or here as pdf: 2020_30_09 – CfP [ENG] .

 

The Working Group of Young Scholars in Public International Law (Arbeitskreis junger Völkerrechtswissenschaftler*innen – AjV) and the German Society of International Law (Deutsche Gesellschaft für Internationales Recht – DGIR) invite contributions to their joint conference titled

Jurisdiction

Who speaks international law?

3-4 September 2021

University of Bonn

 

The topic: Jurisdiction endows an actor with the authority to provide binding answers to legal questions. Etymological observations reveal that an analysis of legal validity necessarily requires grasping the notion of jurisdiction. After all, the Latin roots of the term ‘jurisdiction’ – juris dicere – can be translated as ‘speaking the law’. In international law, the notion of jurisdiction serves to delimit international and domestic spheres of competence. Traditionally tied to territorial sovereignty, jurisdiction refers to the legislative, judicial, and executive power of the state bindingly to determine who speaks in the name of the law – and about whom is (merely) spoken. Against this backdrop, the link between jurisdiction and territorial sovereignty needs to be re-examined.

Several questions arise regarding the theoretical and historical underpinnings of the notion of jurisdiction: Who is given the power to speak in international law and who is not? How can rules that are generally considered to be ‘non-binding’ exert their influence on jurisdiction? How do actors located in the Global South approach the notion of jurisdiction? What is the role of jurisdiction in shaping the idea and self-description of International Law as a discipline? Do we have to rethink or abandon the conceptual link between sovereignty and jurisdiction? Is there an essential and unifying element that links the different conceptions of jurisdiction?

Interdisciplinary engagements can provide a more nuanced understanding of jurisdiction: How can accounts not linked to the state help us understand contemporary conflicts of jurisdiction? Which historical circumstances have shaped the notion of jurisdiction? Which (dis)continuities does the history of the idea of jurisdiction reveal? Are questions of jurisdiction always questions of power? How do socio-cultural circumstances inform diverging notions of jurisdiction? How can critical approaches sharpen our understanding of the notion of jurisdiction?

The aim is to shed light on these and other aspects of jurisdiction from different perspectives, taking into account specialized areas of international law: How has private international law dealt with conflicts of jurisdiction and ‘forum-shopping’? What is the relationship between sovereignty and state or diplomatic immunity? How do digital spaces challenge existing notions of jurisdiction? Do we need a new concept of jurisdiction for cyber warfare and for space law? What is the role of the notion of jurisdiction in shaping the relationship between humans and their natural environment? How do rival notions of jurisdiction affect the access to justice regarding human rights violations at the borders of Europe? How can the conflict between the German Federal Constitutional Court and the European Court of Justice be analysed through the lens of jurisdiction? What are the causes of the criticism levelled against the International Criminal Court’s interpretation and exercise of its jurisdiction?

We invite submissions contemplating these and other questions and hope to cover a broad range of international law topics, including public international law, private international law, and European law. We welcome all theoretical approaches and methods and explicitly invite doctrinal work as well as interdisciplinary, discourse theoretical, historical, philosophical, and critical approaches.

Formal requirements: The main purpose of the conference is to create an opportunity for PhD students and early career researchers to present their work. Established scholars will comment on the young scholars’ contributions. Anonymised abstracts in German or English (max. 500 words) must be submitted by 8 January 2021 only via the application form on the conference website. Selected candidates will be notified by 31 January 2021. Paper drafts (max. 7000 words, including footnotes) must be submitted by 1 June 2021. We envisage to publish the contributions.

On Monday, October 26, 2020 at 15.00 CET, the European Center for Arbitration and Mediation and The International School of Arbitration and Mediation for Europe, the Mediterranean and the Middle East organise their Annual International Conference Med-Mid XIV on “The Burden of Proof in International Arbitration/La charge de la preuve dans l’arbitrage international”.

The conference addresses four key issues of any international arbitration, which require a focussed and renewed reflection: 1) Oral Evidence: Fact Witnesses, Expert Witnesses, Parties and Witness Statement (Civil Law and Common Law approaches); 2) The applicable Law on matters such as the effects of the procedural law (Civil Law and Common Law approaches) on the taking of evidence; 3) Disclosure of documents: effects of only voluntary production of documents v. forced discovery; 4) The Arbitrator’s authority as to evidence (Role as Umpire; wider ex officio authority as to evidence) as well as limits and support from State Courts.

Some worldwide renowned speakers will give their views. On panel one: Sir Michael Burton (London, U.K.) and Prof. Fabrizio Marrella (Venice, Italy); on panel two: Elie Kleiman (Jones Day, Paris, France) and Prof. George Bermann (Columbia Law, New York, USA); on panel three: Melanie Willems (Haynes Boone, London, U.K.) and Prof. Ercument Erdem (Istanbul, Turkey); on panel four: Prof. José Carlos Fernandez Rozas (Complutense Madrid, Spain) and John Fellas (Hughes Hubbard & Reed, New York, USA).

Here is the complete program: https://cour-europe-arbitrage.org/med-mid-xiv/

Participation is free, but registration is necessary.

No decisions on PIL matters will be taken this month. However, a couple of opinions will be published, and a hearing will be held.

AG’s Spuznar opinion on C–469/19, All in One Star, will be delivered on 14 October 2020. The request from the German Bundesgerichtshof was lodged on 19 June 2019.

The questions submitted are as follows:

1. Does Article 30 of Directive (EU) 2017/1132 [relating to certain aspects of company law] preclude a national provision under which the indication of the amount of share capital or a comparable capital value is required for a branch of a limited liability company with registered office in another Member State to be entered in the commercial register?

2.a Does Article 30 of Directive (EU) 2017/1132 preclude a national provision under which, when applying for a branch of a limited liability company with registered office in another Member State to be entered in the commercial register, the managing director of the company has to provide an assurance that there is no barrier to his personal appointment under national law in the form of a prohibition, ordered by a court or public authority, on practising his profession or trade, corresponding in whole or in part with the object of the company, or in the form of a final conviction for certain criminal offences and that, in this respect, he has been instructed of his unrestricted duty to provide information to the court by a notary, a representative of a comparable legal advisory profession or a consular officer?

2.b If Question 2.a is answered in the negative: Do Articles 49 and 54 TFEU preclude a national provision under which the managing director of the company has to provide such an assurance when applying for a branch of a limited liability company with registered office in another Member State to be entered in the commercial register?

On the same day, the hearing in C-729/19 Department of Justice for Northern Ireland will take place. The issue relates the registration and enforcement in Northern Ireland of a maintenance order made by a Polish court before Poland’s accession to the EU pursuant to Council Regulation (EC) No 4/2009 of 18 December 2008. The case has been allocated to the 3rd Chamber (the one who determined as well C-41/19 and C-540/19, with Ms. Rossi as reporting judge), and to AG Hogan.

On 29 October, AG Saugmandsgaard Øe will deliver his opinion in C-804/19 , Markt24. Here, the questions come from the Landesgericht Salzburg (Austria), and are not short:

1. Is Article 21 of Regulation (EU) No 1215/2012 applicable to an employment relationship in which, although an employment contract was entered into in Austria for the performance of work in Germany, the female employee, who remained in Austria and was prepared for several months to work, did not perform any work?

In the event that the first question is answered in the affirmative:

2. Is Article 21 of Regulation (EU) No 1215/2012 to be interpreted as meaning that it is possible to apply a national provision which enables an employee to bring an action in the place where she was resident during the employment relationship or at the time when the employment relationship ended (thus facilitating the process of bringing an action), as is the case with Paragraph 4(1)(a) of the Arbeits- und Sozialgerichtsgesetz (Law on the labour and social courts; ‘the ASGG’)?
3. Is Article 21 of Regulation (EU) No 1215/2012 to be interpreted as meaning that it is possible to apply a national provision which enables an employee to bring an action in the place where the remuneration is to be paid or was to be paid upon termination of his employment relationship (thus facilitating the process of bringing an action), as is the case with Paragraph 4(1)(d) of the ASGG?

In the event that Questions 2 and 3 are answered in the negative:

4.1. Is Article 21 of Regulation (EU) No 1215/2012 to be interpreted as meaning that, in the case of an employment relationship in which the female employee has not performed any work, the action must be brought in the Member State in which the employee remained prepared to work?

4.2. Is Article 21 of Regulation (EU) No 1215/2012 to be interpreted as meaning that, in the case of an employment relationship in which the female employee has not performed any work, the action must be brought in the Member State in which the employment contract was initiated and entered into, even if the performance of work in another Member State had been agreed or envisaged in that employment contract?

In the event that the first question is answered in the negative:

5. Is Article 7(1) of Regulation (EU) No 1215/2012 applicable to an employment relationship in which, although an employment contract was entered into in Austria for the performance of work in Germany, the female employee, who remained in Austria and was prepared for several months to work, did not perform any work, if it is possible to apply a national provision which enables an employee to bring an action in the place where she was resident during the employment relationship or at the time when the employment relationship ended (thus facilitating the process of bringing an action), as is the case with Paragraph 4(1)(a) of the ASGG, or if it is possible to apply a national provision which enables an employee to bring an action in the place where the remuneration is to be paid or was to be paid upon termination of the employment relationship (thus facilitating the process of bringing an action), as is the case with Paragraph 4(1)(d) of the ASGG?
6. The proceedings are stayed pending the ruling the Court of Justice (Paragraph 90a of the Gerichtsorganisationsgesetz (Law on the organisation of the courts; ‘the GOG’).

The chamber in charge is the 5th, (Bonichot, Bay Larsen, Toader, Safjan, Jääskinen), with Mr. Safjan as reporting judge.

Registration for the 2021 Online Winter Courses will open on October 8th, 2020 at 0:00 hrs. The Hague Time (GMT +1).

Due to the COVID-19 pandemic, and for the first time in the Academy’s almost century-old history, a session of courses will be held exclusively online, that of winter 2021. The programme of the Winter Courses will take place as originally scheduled, from 11 to 29 January 2021. The Academy will offer registered attendees the opportunity to follow the courses in webinar format through the Zoom software application.

Programme:

Inaugural Lecture: A House of Many Rooms: The Rise, Fall and Rise Again of Territorial Sovereignty? Malcolm N. SHAW QC, Emeritus Sir Robert Jennings Professor at the University of Leicester

General Course (delivered French, simultaneously interpreted into English): International Law and Normative Polycentrism, Maurice KAMTO, Honorary Professor at the University of Yaoundé II

International Law-Making for the Environment, Alan BOYLE Emeritus Professor at the University of Edinburgh

Evidence in International Adjudication, Chester BROWN, Professor at the University of Sydney Law School

The Emergence of Food Sovereignty in International Law (delivered French, simultaneously interpreted into English), Olivier DE SCHUTTER, Professor at the Université catholique de Louvain and Former UN Special Rapporteur on the Right to Food

The Protection of Religious Cultural Property in Public and Private International Law (delivered French, simultaneously interpreted into English), José Angelo ESTRELLA FARIA, Principal Legal Officer and Head of the Legislative Branch, in the International Trade Law Division, UN Office of Legal Affairs

Civil War and the Transformation of International Law, Anne ORFORD, Professor at the University of Melbourne

The Regulation of the Internet, Inger ÖSTERDAHL, Professor at the University of Uppsala

Relationships Between International Criminal Law and Other Branches of International Law, William SCHABAS, Professor at Middlesex University London and at Leiden University

The programme can be downloaded here.

Further information on registration is here.

Highly recommended!

Professor Sophia Tang, Wuhan University (China) and Newcastle University (UK) will give a virtual seminar in the Durham University China Law Centre. The topic is “extraterritorial effects of the Hong Kong National Security Law”.

Webinar: Extraterritorial Effects of the Hong Kong National Security Law  Speaker:Prof Zheng TANG (Newcastle Law School)  Time:13:00 p.m. Tuesday, October 13    Zoom: https://durhamuniversity.zoom.us/j/96430562639?pwd=NS9lTGlxN3U2T2dzWWIwckJodGFRQT09 Meeting ID?964 3056 2639 Passcode:131767

Abstract:

The very controversial Law of the People’s Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region (“HK National Security Law” hereafter) was promulgated in the 20thsession of the 13th National People’s Congress (NPC) of China on 30 June 2020 and entered into effect in the Hong Kong Special Administrative Region (HKSAR) at 23:00 on the same day. This law defines four categories of offences and penalties, namely secession, subversion, terrorist activities and collusion with foreign or external elements to endanger national security. Article 38 provides: “This Law shall apply to offences under this Law committed against the Hong Kong Special Administrative Region from outside the Region by a person who is not a permanent resident of the Region.” This article extends jurisdiction of the HK National Security Law to the action of any individuals or organisations in any country, irrespective of their nationality, residence and the law of the countries where the action has taken place. The extraterritorial effect can be summarised as: no nexus or proximity, no double criminality, and no identity requirements. The legal basis for this jurisdiction is the protective principle, which allows a state to regulate extraterritorial conduct by foreigners or non-residents that may jeopardise its vital interests.  

In this seminar, we are going to discuss what is protective jurisdiction, whether the extraterritorial effect of the HK National Security Law is justifiable in international law, what the overseas impact of the HK National Security Law would be, especially on the freedom of speech, and how this law could be enforced in practice.  

 

The members of the proposed EAPIL Working Group on International Property Law will host a webinar 20 October 2020, from 12:30 to 2 pm.

The webinar will illustrate the goals and agenda of the Working Group and provide EAPIL members with the possibility to join the discussion on a future European Regulation on International Property Law.

The webinar’s programme is as follows:

• Prof. Dr. Teun Struycken (Amsterdam/Utrecht): The Significance of International Property Law (case study)
• Ass. Prof. Dr. Teemu Juutilainen (Turku): The Impact of Free Movement of Goods and Services on International Property Law
• Prof. Dr. Gilles Cuniberti (Luxemburg): The Impact of the Acquis Communautaire on International Property Law
• Prof. Dr. Janeen M Carruthers (Glasgow): Global Measures for the Unification of Private International Rules pertaining to Property
• Prof. Dr. Eva-Maria Kieninger (Würzburg): The Way Ahead: Topics and Goals of the Working Group

The practical details for attending the webinar will be communicated soon on this blog.

Situations exist where a judicial document addressed to a person based abroad may be communicated to a lawyer representing that person in the forum State, instead of being served abroad on the addressee himself or herself. This usually applies to service occurring after the act instituting the proceedings has been served on the defendant in conformity with either the Service Regulation or the Hague Service Convention.

In fact, the described situation may also arise in the framework of proceedings brought by a foreign claimant against a defendant based in the forum. In this case, the defendant may reasonably presume that the lawyer signing the claim on behalf of the foreign litigant is eligible for receiving documents related to the case.

While the latter assumption would generally seem to be accurate, the admissibility of service on the lawyer  depends on the kind of documents that the latter is in fact allowed to receive on behalf of the client.

In 2019, the Greek Supreme Court issued an interesting ruling on the matter.

The Facts

After longstanding business collaboration between a Greek company and a Finnish telecommunications giant, a decade of confrontation began in 2010. In a series of proceedings, the parties fought through all court instances.

The first stage was a successful application for a freezing order filed by the Finnish company. An actio pauliana was filed in parallel by the same company, which was dismissed by the Athens Court of First Instance. The appeal lodged by the Finnish company, instead was successful. The losing party filed cassation against the Athens Court of Appeal ruling.

Almost at the same time, the Greek company lodged an application to reverse the freezing order, which was filed to the Supreme Court, in accordance with domestic Civil Procedure Rules (Article 698 of the Code of Civil Procedure).

As in previous stages of the litigation, the document was served on the lawyer representing the Finnish company. The latter did not appear in the hearing.

The Ruling

The Supreme Court ruled that the application was inadmissible because it was not served on a lawyer instructed by the foreign company to accept service on its behalf at a business address within the jurisdiction [Supreme Court Nr. 470/2019, unreported]. The reasoning of the court may be summarised as follows:

• Proper indirect service (in the case at hand, service to a lawyer representing a party), must be demonstrated by the party instructing the process server to deliver the document in this fashion.
• Pursuant to Greek law, a foreign party may appoint a representative ad litem in the following ways: by a declaration addressed to the clerks of the Athens Court of First Instance; by a specific clause in a contract; by appointing a lawyer as a representative ad litem pursuant to Article 96 of the Greek Code of Civil Procedure [i.e. orally before the court and prior to the hearing, or in written by means of a private power of attorney, upon the condition that the signature has been certified by a public authority or another attorney at law].
• Pursuant to Article 143(4) of the Code of Civil Procedure, all documents addressed to a foreign party must be served on the representative ad litem, if properly appointed, provided they fall within the set of cases covered by the power of attorney for the purpose of service.
• The Supreme Court found, however, that the application by the appellant to reverse the freezing order before the Court itself was not related to the set of cases for which the lawyer of the Finnish company was appointed. In particular, the lawyer’s appointment concerned the main dispute (which reached the Supreme Court), not the provisional measures (freezing order).
• Therefore, service of the application to reverse the freezing order to the lawyer who received the writ on behalf of the Finnish company was inadmissible.
• The above result is free of doubt, notwithstanding the same lawyer acted and received documents on behalf of the Finnish company in a number of occasions, such as: representation before the Athens Court of First Instance and Court of Appeal; representation before the court which issued the freezing order; filing on behalf of the Finnish company of an application for declaring the Greek company insolvent, and representing the same party before court in the bankruptcy proceedings.

Comments

Almost ten years after the start of litigation, and following a number of hearings where the Finnish company was represented by the same lawyer, the Supreme Court considered that the latter had no powers of representation in a case initiated by his own application, followed by his appearance before the court, and his instruction to serve the freezing order to the losing party.

The ruling of the Supreme Court rests upon a formalistic construction of the law; contradicts to the factual situation of the dispute; causes additional costs to the applicant with no apparent reason; endangers the right to judicial protection, given that service from Greece to Finland is not business as usual.

Last but not least, the Supreme Court did not utter a word about the actual applicable rules, i.e those in the Service Regulation. It failed to take into account Recital 8 of the Preamble and the pertinent case law of the CJEU. Finally, it missed the chance to address the matter to the European Court of Justice, by filing a preliminary request for an issue which continues to puzzle academia and practice alike.

The 2021 winter course of the Hague Academy of International Law will be held online from 11 to 29 January 2021.

One remarkable feature of the Academy’s winter courses is that they jointly cover topics belonging (or traditionally labelled as belonging) to both public and private international law.

The General Course will be delivered by Maurice Kamto under the title International Law and Normative Polycentrism.

Special courses include: Evidence in International Adjudication by Chester Brown, The Protection of Religious Cultural Property in Public and Private International Law by José Angelo Estrella Faria, and The Regulation of the Internet by Inger Österdahl.

The winter course’s full programme is available here.

Registration will open on 8 October 2020. Further information is available on the Academy website.