Conflictoflaws

Silvia Marino has just published her new book on cross-border family patrimonial relationships. Here’s an abstract prepared by the author in English:

This study tackles the PIL-related aspects of the cross-border family’s patrimonial relationships. The main focus is on the coordination and the coherence of the different International and European sources of law, taking as cornerstones the two recent EU Regulations on the matrimonial property regimes and the patrimonial effects of registered partnerships. The other fields dealt with are international successions and maintenance, as part of the global patrimonial organization of the family. Due to the high number of International and European measures within this fields, the volume offers an accurate evaluation of the final coherence of the legislation, with particular regard within the EU.

The book starts with an historical introduction and a first analysis of the definitions (with particular regard to the current notion of family). Then, it  tackles all the classical topics of PIL, under the light of the coherence of the patrimonial organization within the family. The first chapter analyses the coordination of International, European and National sources, as a necessary step to determine the applicable normative measure. Then, the study presents an examination of the convergences and divergences of the regulations in the different sources of law. The first parameter is the role of party autonomy, both within the determination of international jurisdiction and the conflict of laws. Indeed, all the measures examined leave a margin of freedom of choice in favour of the parties, which should stem into coherent outputs. The second parameter is the determination of the international jurisdiction, followed by the connecting factors, and the impact of their application to the coherence of the property regime’s regulation. The third parameter is the (scarce) legislation on the general issues of PIL, as rules on the correct functioning and application of the conflict of law rules. Finally, the last part is devoted to the different models of transnational circulation of judicial decisions, authentic instruments and Court settlements, which might have evidentiary and even enforceable effects within EU Member States. The number of acts that can freely circulate within the EU risks creating difficulties at the enforcement stage. The conclusions offer some few further ideas on the future developments of an EU Area of Freedom, Security and Justice.

Following the Second German Conference for Scholars in Private International Law, which will take place on 4 and 5 April 2019 at the University of Würzburg, Germany, the newly established research network Young Private International Law in Europe hosts a workshop on ‘Recognition/Acceptance of Legal Situations’. The organisers, Susanne Goessl (University of Bonn) and Martina Melcher (University of Graz), have kindly provided this invitation.

by Lukas Schmidt

Roughly two years ago the Commission presented the proposal for a Directive on preventive restructuring frameworks, second chance and measures to increase the efficiency of restructuring, insolvency and discharge procedure (see Blogpost ). After a lively debate the Council has now confirmed an agreement reached with the Parliament on the directive in December last year (see press release of 19 December 2018).

According to the press release several provisions were added or amended compared to the Council’s positions including the introduction of provisions on the duties of company directors in insolvency proceedings, an article on worker’s rights  to recall that member states should ensure that the existing rights of workers under national and Union law are not affected by the preventive restructuring procedure and provisions on the appointment of a restructuring practitioner.

The text still has to be formally adopted by the Council and Parliament. Member states will then have 2 years for implementation, although they can ask the Commission for an additional year for implementation.

As reported on Twitter by Pacta sunt servanda, the UK has just (on 2 January 2019) signed and ratified the 2005 Hague Convention on Choice of Court Agreements and the 2007 Hague Convention on the International Recovery of Child Support and other Forms of Family Maintenance. Both Conventions currently apply to the UK by virtue of its membership of the European Union but may cease to do so once the UK leaves the EU on 29 March 2019. (The relevant notifications by the Dutch Ministry of Foreign Affairs can be found here and here.)

Importantly, both conventions have been ratified only for the event of a Brexit scenario in which no withdrawal agreement with the EU has been reached and contain the following qualification:

In accordance with Article 29 of the 2005 Hague Convention/Article 59 of the 2007 Hague Convention, the United Kingdom is bound by the Convention by virtue of its membership of the European Union, which approved the Convention on behalf of its Member States. The United Kingdom intends to continue to participate in the 2005/2007 Hague Convention after it withdraws from the European Union.

The Government of the United Kingdom and the European Council have reached political agreement on the text of a treaty (the “Withdrawal Agreement”) on the withdrawal of the
United Kingdom from the European Union and the European Atomic Energy Community. Subject to signature, ratification and approval by the parties, the Withdrawal Agreement
will enter into force on 30 March 2019.

The Withdrawal Agreement includes provisions for a transition period to start on 30 March 2019 and end on 31 December 2020 or such later date as is agreed by the United
Kingdom and the European Union (the “transition period”). In accordance with the Withdrawal Agreement, during the transition period, European Union law, including the
2005/2007 Hague Convention, would continue to be applicable to and in the United Kingdom. The European Union and the United Kingdom have agreed that the European Union will
notify other parties to international agreements that during the transition period the United Kingdom is treated as a Member State for the purposes of international agreements concluded by the European Union, including the 2005/2007 Hague Convention.

In the event that the Withdrawal Agreement is not ratified and approved by the United Kingdom and the European Union, however, the United Kingdom wishes to ensure continuity of application of the 2005/2007 Hague Convention from the point at which it ceases to be a Member State of the European Union. The United Kingdom has therefore submitted the Instrument of Accession in accordance with Article 27(4) of the 2005 Hague Convention/Article 58(2) of the 2007 Hague Conventio only in preparation for this situation. The Instrument of Accession declares that the United Kingdom accedes to the 2005 Hague Convention in its own right with effect from 1 April 2019.

In the event that the Withdrawal Agreement is signed, ratified and approved by the United Kingdom and the European Union and enters into force on 30 March 2019, the United Kingdom will withdraw the Instrument of Accession which it has today deposited. In that case, for the duration of the transition period as provided for in the Withdrawal Agreement as stated above, the United Kingdom will be treated as a Member State of the European Union and the 2005 Hague Convention will continue to ha ve effect accordingly.

In the past, it had been questioned if the UK would be able to ratify these conventions before having left the EU (see, eg, Dickinson, ZEuP 2017, 539, 560), which, if the “No Deal” scenario became a reality, would leave a period of at least three months in which the conventions would not apply. By ratifying the Conventions now, the UK seems to have reduced this potential gap to a single day as both conventions will enter into force for the UK on 1 April 2019.

Symeon Symeonides‘ Annual Survey of American Choice-of-Law Cases for 2018, now in its 32nd year, has been posted on SSRN. A summary of the contents is reproduced below. If you are interested in the Survey, you can download it by clicking here.
If you are interested in the Private International Law Bibliography for 2018, you can download it from SSRN by clicking here.

Symeon sends his best wishes for the New Year, and I concur.

Table of Contents

Introduction

I. The Extraterritorial Reach of Federal Law

A. The Alien Tort Statute

B. The Fourth and Fifth Amendments and Cross-Border Shootings

C.-M. Other Federal Statutes

II. Choice of Law

A. Proof of Foreign Law

B. Anti-Foreign Law Amendments

C. Choice-of-Law Methodology

D. Contracts

1. Contracts with Choice-of-Law Clauses

a. Choice of Procedural or Conflicts Law

b. Choice-of-Law Clauses and Statutes of Limitation

c. Plain Choice-of-Law Clauses

d. Choice-of-Law and Forum-Selection Clauses

e. Choice-of-Law and Arbitration Clauses

2. Contracts without Choice-of-Law Clauses

E. Torts

1. Common Domicile Cases

2. Cross-Border Unfair Trade Practices

3. Other Torts

F. Products Liability

G. Statutes of Limitation

H. Insurance Conflicts

I. Nazi-Looted Art

J. Domestic Relations

1. Marriage and Divorce

2. Marital Property

3. Adoption and Succession

4. Child Custody and the Hague Convention

III. Recognition of Foreign Judgments and Awards

A. Foreign-Country Judgments

B. Sister-State Judgments

C. Foreign Arbitral Awards

The American Association of Law Schools will hold its annual conference in New Orleans this year, from January 2-6. In this conference, the meeting of the Conflict of Laws Interest Group will be on Friday January 4, 8:30-10:15. (Yes, early.) The topic is the new Hague Judgments Convention (the draft Convention is here.) Speakers will include Louise Ellen Teitz (Rhode Island University) with a view from the Hague, Trey Childress (Pepperdine/State Dept) with a view from the State Department, and John Coyle (UNC) with a view from academia. I will chair. The remarks will be published later in the Duke Journal of Comparative and International Law, but if you are at the AALS Conference, please do come and discuss there!

On 22 January 2019, the Arendt House (Luxembourg) will host a conference organised by The Luxembourg Association of Law Graudates of the University of Louvain (UCL) and the Law Review Le droit des affaires – Het ondernemingsrecht (DAOR) on the Proposal for a Regulation of the European Parliament and of the Council on the law applicable to the third-party effects of assignments of claims.

The conference will be chaired by Prof. Marie-Elodie Angel (University Paris Est Créteil, UPEC). Speakers, who will discuss assignment of claims, security rights and securitisation, include Prof. Denis Philippe (Philippe & Partners; University of Louvai), Grégory Minne (Arendt & Medernach; University of Luxembourg) and Jean-Paul Spang (Kleyr Grasso; University of Luxembourg).

The conference will be in French without translation into English.

Details are available here.

The Draft Guide to Good Practice on the Use of Video-Link under the Evidence Convention has been submitted for the approval of the HCCH governance body (i.e. the Council on General Affairs and Policy of the Hague Conference on Private International Law), which will meet in March 2019.

This Guide analyses developments in relation to the use of video-link in the taking of evidence under the Evidence Convention, including references to internal law and other international agreements. It also outlines good practices to be followed and reflects additional information provided by Contracting Parties in their respective Country Profiles.

In my personal opinion, the most striking conclusion was that responding States to the Country Profiles are almost evenly divided as to whether evidence may be taken directly by video-link by Letters of Request (under Chapter I of the Evidence Convention). In other words, there is no clear consensus on whether the requesting court can take evidence directly in the Requested State by video-link under Chapter I of the Evidence Convention (e.g. take testimony from a witness by videoconference). Some see legal obstacles whereas others do not. The Convention was after all negotiated in the late sixties. A question may arise as to whether an international treaty is needed to address particularly this issue and include the necessary safeguards for video-link taking of evidence.

The Court of Appeal for Ontario has upheld a decision of the Superior Court of Justice dismissing a $2 billion claim against Loblaws relating to the 2013 collapse of the Rana Plaza building in Savar, Bangladesh.  In Das v George Weston Limited, 2018 ONCA 1053 (available here) the court concluded that the claims were governed by the law of Bangladesh (not Ontario).  It went on to conclude that most of the claims were statute barred under the Bangladeshi limitation period and that it was “plain and obvious” that the remaining claims would fail under Bangladeshi tort law.

Unlike some of the recent cases in this area, this was not a case about a Canadian parent corporation and the operations of its own foreign subsidiary.  It was a case about a contractual supply relationship.  Loblaws bought clothes (to sell in its Canadian retail stores) from corporations whose workers manufactured the clothes in Rana Plaza.

The key conflict of laws point was the choice of law issue.  The rule in Ontario is that tort claims are governed by the law of the place of the tort: Tolofson v Jensen, [1994] 3 SCR 1022.  The plaintiffs had argued that they were suing Loblaws for negligent conduct that exposed those working in Rana Plaza to harm.  They argued that Loblaws had, by adopting corporate social responsibility policies and hiring Bureau Veritas to conduct periodic “social audits” of the workplace, assumed a degree of responsibility for the safety of the workplace in Bangladesh (para 20).  They argued that the key steps and decisions by Loblaws took place in Ontario rather than in Bangladesh and therefore Ontario was the place of the tort (para 80).  The court rejected these arguments.  It held that the place where the alleged wrongful activity occurred was Bangladesh (para 85), that the alleged duty was owed to people in Bangladesh (para 87) and that the injury suffered in Bangladesh “crystallized the alleged wrong” (para 90).

The court also refused to apply Tolofson‘s narrow exception to the place of the tort rule.  One reason the plaintiffs raised for triggering the exception was the lack of punitive damages under the law of Bangladesh.  The court noted that the lower court’s decision had suggested such damages might actually be available under that law, but in any case “the absence of the availability of punitive damages is not the type of issue that offends Canadian fundamental values” (para 95).  The court raised no basis on which to disagree with this analysis.

Because the applicable law was that of Bangladesh, and because some of the claims were not statute-barred, the court was required to do a detailed analysis of Bangladeshi tort law on the duty of care issue in order to determine whether those claims were to be dismissed as not viable.  This aspect of the decision may be the most disquieting, since there was little if any on-point authority in the Bangladeshi jurisprudence (para 130).  The court had to rely on experts who were relying on a considerable volume of Indian and English cases and then debating the extent to which these would impact the issue if determined by a Bangladeshi court.  Ultimately the court concluded that under Bangladeshi law the claims could not succeed.

In a much anticipated outcome, the Grand Chamber of the European Court of Human Rights held unanimously that there had been a violation of Article 14 (prohibition of discrimination) of the European Convention on Human Rights, read in conjunction with Article 1 of Protocol No. 1 (protection of property) to the Convention.

The case concerned the application by the domestic courts of Islamic religious law (Sharia) to an inheritance dispute between Greek nationals belonging to the Muslim minority, contrary to the will of the testator (a Greek belonging to the Muslim minority, Ms Molla Sali’s deceased husband), who had bequeathed his whole estate to his wife under a will drawn up in accordance with Greek civil law.

The full text of the decision may be found here. 

The press release of the Court is available here.

For the recent amendments in pertinent Greek legislation, see here.

Written by Michael McParland, QC, 39 Essex Chambers, London

On 10 December 2018 the Ministry of Justice published a draft statutory instrument with the pithy title of “The Law Applicable to Contractual Obligations and Non-Contractual Obligations (Amendment etc) (EU Exit) Regulations 2018”. This indicates the current intended changes to retained EU private international law of obligations post Brexit.

These draft 2018 regulations are made in the exercise of the powers conferred by section 8(1) of, and paragraph 21(b) of Schedule 7 to, the European Union (Withdrawal) Act 2018 in order to “address failures of retained EU law to operate effectively and other deficiencies… arising from the withdrawal of the UK from the European Union”. It is intended they will come into force on exit day.

Part 2 contains amendments to existing primary legislation in the UK. These include amendments to the Contracts (Applicable Law) Act 1990, the UK statute that implemented the 1980 Rome Convention on the law applicable to contractual obligations. The Explanatory Memorandum now declares that “the United Kingdom will no longer be a contracting party [to the Rome Convention]after exit day”. This is modestly surprising, given that the Rome Convention was not actually part of the Community acquisin the first place (see Michael McParland, “The Rome I Regulation on the Law Applicable to Contractual Obligations”, para. 1.99). But the current desire to disentangle the UK entirely from any vestiges of things European appears to be overwhelming. Consequently, the draft 2018 regulations convert the most of the rules found into the Rome Convention into UK domestic law, and declare that they will continue to apply them to contracts entered into between 1stApril 1991 and 16thDecember 2009 in the same way as they have done since the arrival of the Rome I Regulation. Further amendments are also made to the Prescription and Limitation (Scotland) Act 1973 and the Private International (Miscellaneous Provisions) Act 1995, the pre-Rome II statute which contains the UK’s rules on choice of law in tort and delict.

Part 3 deals with amendments to secondary legislation which had been originally created to deal with the coming into force of the Rome I and Rome II Regulations.

Part 4 is entitled “Amendment of retained EU Law”, this new legal category that will see EU law as at the date of the UK’s departure from the EU transposed into domestic law. Part 4 deals with the proposed substantive amendments to the enacted text of both the Rome I and Rome II Regulation which are considered necessary or appropriate to take account of the UK ceasing to be an EU Member State. The full impact of the changes will have to be considered in detail against the original texts, but some brief comments can be made.

Some changes are mere housekeeping. For example, in the “universal application” provisions found in Article 2 (Rome I) and Article 3 (Rome II) which declares that “any law specified by this Regulation shall be applied whether or not it is the law of a Member State”, are to be amended with reference to “a Member State” being replaced with “the United Kingdom or a part of the United Kingdom”.

Others involve updating references to rules found in Directives to their current equivalent sin UK domestic law. So, for example, Article 4(1)(h) of the Rome I Regulation currently provides for the applicable law in the absence of choice for:

(h) a contract concluded within a multilateral system which brings together or facilitates the bringing together of multiple third-party buying and selling interests in financial instruments, as defined by Article 4(1), point (17) of Directive 2004/39/EC, in accordance with non-discretionary rules and governed by a single law, shall be governed by that law.

The draft regulations will now replace the reference to “by Article 4(1), point (17) of Directive 2004/39/EC” with “… in Part 1 of Schedule 2 to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001” which as a footnote notes is S.I.2001/544, though the relevant Schedule 2 was substituted by S.I. 2006/3384 and this itself was subsequently amended by the Financial Services and Market Act 2000 (Regulated Activities) (Amendment) S.I. 2017/488 (which took effect from 1 April 2017 and which includes a whole raft of definitional changes).

Other changes deal with the fact that exit day will formally cut the UK’s version of these Regulations off from any future changes made by the EU legislator to either of those Regulations.

Part 4 of the Regulation also revokes Regulation EC No. 662/2009 which established the procedure for the negotiation and conclusion of agreements between EU Member States and third countries on the law applicable to contractual and non-contractual obligations (see McParland, para. 2.100).

Potentially more interesting changes are made to the Rome II Regulation, especially in relation to Article 6(3)(b) (unfair competition and acts restricting free competition), and Article 8 (infringement of intellectual property rights).

The changes to the Rome I Regulation and their implications will feature in the second edition to my book on the subject which I am currently working on.

The Ministry of Justice’s web-site can be accessed here.

The conclusions of the EC-HCCH Joint Conference on the Cross-border Protection of Vulnerable Adults are now available here.

See also related post by Pietro Franzina here.

The Permanent Bureau of the Hague Conference on Private International Law (HCCH) is seeking to fill a Diplomat Lawyer (Secretary) position. The deadline for applications is 31 December 2018 (12.00 a.m. CET). For more information, click here.

Given diversity of geographic representation and of legal expertise requirements as set out in the HCCH Statute, candidates should preferably not have (exclusively) Swiss, Canadian, Italian, Portuguese, or Singaporean nationality. Currently, there are Diplomat Lawyers of those nationalities at the HCCH.

As announced, “[t]he main priorities for this position currently include the ongoing parentage/surrogacy project and the work relating to the HCCH Convention of 29 May 1993 on Protection of Children and Co-operation in Respect of Intercountry Adoption. This said, the successful candidate will be expected to work on any other project or file that the work programme of the HCCH and related resource allocation may require (be it in relation to post-Convention services or the development of legislative projects).”

Approximately eight years ago, the European Chapter of the International Academy of Family Lawyers (“IAFL”) established a writing award for young family lawyers to be awarded on an annual basis. The award aims to promote research and excellence among young family lawyers and to increase awareness among other legal professionals of the work and objectives of the IAFL. The Young Lawyers Award carries a prize of €1,000, awarded to the author of the winning contribution, and two €500 prizes for the best runners up. For more information, please click here.

Written by Markus Lieberknecht, Institute for Comparative Law, Conflict of Laws and International Business Law (Heidelberg)

Quite a literal “conflict of laws” has recently arisen when the EU reactivated its Blocking Statute in an attempt to deflect the effects of U.S. embargo provisions against Iran. As a result, European parties doing business with Iran are now confronted with a dilemma where compliance with either regime necessitates a breach of the other. This post explores some implications of the Blocking Statute from a private international law perspective.

The European Blocking Statute (Regulation (EC) 2271/96)was originally enacted in 1996 as a counter-measure to the American “Helms-Burton Act” which, at the time, compromised European trade relations with Cuba. Along with WTO and NAFTA proceedings, the Blocking Statute provided sufficient leverage to strike a compromise with the Clinton administration. The controversial parts of the “Helms-Burton Act” were shelved and the few remaining pieces of legislation otherwise covered by the Blocking Statute ceased to be relevant over time. The Blocking Statute formally stayed in force but, for want of any legislation to block, remained in a legislative limbo until 8 May 2015.

On this day, President Trump announced his decision to withdraw the U.S. from the Iran nuclear deal (Joint Comprehensive Plan of Action – JCPOA) and to fully restore the U.S. trade sanctions against Iran. In particular, this entailed reinstating the so-called secondary sanctions which apply to European entities without ties to the U.S. This decision, albeit hardly unexpected, was met with sharp dissent in Europe. Not only was the JCPOA viewed by many as a remarkable diplomatic achievement, but secondary sanctions were seen as an illicit attempt to regulate European-Iranian trade relations without a genuine link to the U.S. The EU, claiming that this practice violated international law, immediately declared its intention to protect European businesses from the extraterritorial reach of the U.S. sanctions. In order to make good on this promise, an all but forgotten instrument of European private international law was swiftly dusted off and updated: The Blocking Statute.

 The centerpiece of the Blocking Statute is its Art. 5 which prohibits affected Parties from complying with the relevant U.S. legislation. Depending on the Member State, a breach of this provision can be sanctioned with potentially unlimited criminal or administrative fines.

The disapproval enshrined in Art. 5 Blocking Statute – or, arguably, in the Blocking Statute as a whole – amounts to a specification of the European ordre public. Regarding the ever-present issue of overriding mandatory provisions, it rules out the possibility to give legal effect to the U.S. sanctions in question. This is either because the Blocking Statute, as lex specialis,supersedes Art. 9 Rome I Regulation altogether or because it has binding effect on the courts’ discretion under Art. 9 (3) Rome I Regulation. However, given the narrow scope of Art. 9 (3) Rome I Regulation, this means ruling out a possibility which was hardly measurable in the first place. After all, Iran-related contracts with a place of performance located in the U.S. as required by Art. 9 (3) Rome I Regulation are, if at all realistically conceivable, extremely rare. What is more, German courts have refrained from applying U.S. sanctions under Art. 9 (3) Rome I Regulation based on the notion that they are superseded by the EU’s own framework of restrictions on trade with Iran. Thus, there were plenty of reasons to deny legal effect before the recent update of the Blocking Statute.

Under the ECJ’s Nikiforidisdoctrine, the relevant sanctions are precluded from being applied as legal rules, but not from being considered as facts under substantive law. In this context, Art. 5 of the Blocking Statute will provide clear, albeit very one-sided, guidance for a number of issues. For instance, parties will not be able to contractually limit the scope of performance to what is permissible under relevant U.S. provisions, nor can they successfully claim a right to withhold performance or terminate contracts based on the justified fear of penalties imposed by U.S. authorities.

It does not require much number-crunching to see that to many globally operating companies, succumbing to U.S. pressure will seem like the the most, or even only, reasonable choice. The portfolio of U.S. penalties includes a denial of further access to the U.S. market and criminal liability of the natural persons involved. U.S. authorities are not shy on using these measures either, as recently evidenced by the spectacular arrest of Huawei’s CFO in Canada on charges of breaching sanctions against Iran. Thus, opting for a breach of the Blocking Statute and accepting the resulting fine under the Member State’s domestic law may strike many companies as a pragmatic choice.

Nonetheless, this decision would entail an intentional breach of European law. Executives, who may also face personal liability for unlawful decisions, are thus faced with a tough compliance dilemma; whichever choice they make can be sanctioned by either U.S. or European authorities. Given this delicate situation, they may happily accept any economic pretext to quietly wind down operations in Iran without express reference to the U.S. sanctions.

Both the Blocking Statute and the U.S. regulation allow for hardship exemptions. U.S. courts may also consider foreign government pressure as grounds for exculpation under the so-called foreign sovereign compulsion doctrine. While it may, therefore, be possible to navigate between both regimes, it appears unlikely that either side will be particularly generous in granting exemptions in order not to undermine the effectiveness of their regulation. After all, the Blocking Statute is in essence designed around the idea to create counter-pressure at the expense of European companies and the U.S. will hardly be inclined to play their part in making this mechanism work.

Art. 6 of the Blocking Statute contains a so-called “clawback claim”. This provision enables parties to recover all damages resulting from the application of the U.S. sanctions in question from the person who caused them. What looks like a promising way to subvert the effect of the U.S. sanctions at first glance, quickly loses much of its appeal when looking more closely. In particular, the “claw back” provides no grounds to recover the most prevalent item of damages in this context, namely penalties imposed by U.S. authorities for breach of sanctions. Although the substantive requirements of Art. 6 Blocking Statute would evidently be met, any claim brought against the U.S. or its entities to remedy what is clearly an act of state would not be actionable in courts due to the doctrine of state immunity.

Thus, the claim is limited to disputes between private parties. The most realistic scenario here is that parties may hold each other liable for complying with U.S. sanctions and, in turn, violating the Blocking Statute. This means that, for instance, companies backing out of delivery chains or financing arrangements may be held liable for the resulting damages of every other party involved in the transaction. Due to the tort-like nature of the claim, this liability would even extend beyond the direct contractual relationships. Functionally, the “clawback” constitutes a private enforcement mechanism of the prohibition enshrined in Art. 5 Blocking Statute. It is, however, much less convincing as an instrument to protect all aggrieved parties from the repercussions of U.S. sanctions.

The renaissance of the Blocking Statute proves the difficulty of blocking the effects of foreign laws in a globalized world. The affected parties were promised protection but received an additional prohibition, arguably multiplying their compliance concerns rather than resolving them. Denying legal effects within the European legal framework is a relatively easy task and, given the narrow scope of Art. 9 Rome I Regulation, not far from the default situation. In contrast, legal instruments which can undermine the factual influence of foreign laws without unintended side effects are yet to be invented.  The true purpose of the Blocking Statutes is a political one, namely serving as a bargaining chip vis-à-vis the U.S. and an attempt to assure Iran that the European Union is not jumping ship on the JCPOA. However, this largely symbolic value will hardly console the affected parties whose legal and economic difficulties remain very much real.

This blog post is a condensed version of the author’s article in IPRax 2018, 573 et seqq. which explores the Blocking Statute’s private law implications in more detail and contains comprehensive references to the relevant literature.

By Georgia Antonopoulou, Erlis Themeli, and Xandra Kramer, Erasmus University Rotterdam (PhD candidate, postdoc researcher, and PI ERC consolidator project Building EU Civil Justice)

Today, the Dutch Senate (Eerste Kamer) finally voted in favour of the legislative proposal for the establishment of the Netherlands Commercial Court (NCC) (see here). As of 11 December 2018, the Netherlands is added to the countries  that have created an English language court or chamber specialized in international commercial disputes, including Singapore and France.

The proposal was already approved by the House of Representatives (Tweede Kamer) on 8 March 2018 (see our previous blogpost). Shortly after, we optimistically reported that the bill was scheduled for rubber-stamping by the Senate on 27 March 2018, making it realistic that the NCC would open its doors on 1 July 2018. However, not all senators were convinced by the need for and the modalities of the NCC proposal and it led to heated debates.

The discussions geared primarily around the cost-effective court fees and the fear for a two-tiered justice system (see Report of the meeting of 4 December 2018). The court fees are much higher than in other cases: 15.000 Euros in first instance and 20.000 Euros for appeal proceedings at the NCCA. It was argued that the cost-covering nature of the NCC fees is at odds with the current Dutch court fee system and that it may create and obstacle for small and medium-sized businesses to access the NCC. In response to these objections, the Dutch Minister of Justice and Security emphasized the importance of the NCC for the Netherlands as a trade country, the high quality of the Dutch civil justice system that was nevertheless unattractive due to the Dutch language, and pointed to the  establishment of similar courts in other countries. He underlined that the NCC is only available in cross-border cases, that it offers an additional forum that parties can choose while the ordinary courts are still available, and that the court fees are relatively low compared to arbitration or to the fees for commercial courts in several other countries, including the London Commercial Court.

Information on the NCC, a presentation of the court – a chamber of the Amsterdam District Court – and the Rules of Procedure are available on the website of the Dutch judiciary.

The Minister of Justice and Security will issue a decree soon announcing the date of entry into force of the NCC legislation, but in any case the NCC will open its doors early 2019.

We would like to invite young scholars to submit a paper for the upcoming conference entitled ‘Judges in Utopia: Civil Courts as European Courts’, which will take place in Amsterdam on 7 and 8 November 2019.

The conference’s aim is to reflect with legal scholars and practitioners on the reconceptualization of the role of civil courts in today’s European private legal order. Specifically, the conference’s focus lies on the courts’ potential to open up space in the deliberative process on concepts of justice in European private law. Proposals addressing the following issues and themes are particularly welcome, as are inter-disciplinary, theoretical and case-study based approaches:

• the impact of fundamental rights on European private law and civil procedure;
• the way(s) in which judges may deal with different conceptions of justice at EU and national level;
• the legitimacy of judicial law-making in European private law;
• the contribution of private law adjudication to polity-building in Europe.

The call for papers is open for young scholars, who are currently PhD researchers or who are post-doctoral researchers and have defended their PhD after 1 January 2016.

Proposals in form of an extended abstract (max. 500 words) should be submitted for review by 15 February 2019 to Betül Kas: b.kas@uva.nl. Submissions will be selected based on quality, originality, and their capacity to incite fruitful debates. Decisions on accepted submissions will be made by 1 April 2019. Authors whose contributions are accepted will be invited to present their paper at the conference and will be expected to submit their paper beforehand. Final papers will be circulated among the participants in advance of the conference. The organisers aim to publish some or all conference proceedings in an edited volume with a reputable publisher or a special issue of a European law journal.

Travelling and accommodation costs for presenters will be covered.

More information on the conference and the ‘Judges in Utopia’ project can be found at https://judgesinutopia.eu

The project team:

Prof. Dr. Chantal Mak

Dr. Betül Kas, LL.M.

Anna van Duin, LL.M., MJur (Oxon)

Laura Burgers, LL.M., BA

Fien de Ruiter, BA

Guest post by Dr. Stefano Dominelli of the University of Milan

In recent times, the European Commission has investigated the possibility of amending Regulation 1393/2007 on the service of judicial and extra-judicial documents between Member States. Such instrument has already settled some issues practitioners encountered under the application of the previous legal framework, in particular related to the administrative cooperation regime, the linguistic exception to service, and direct service by registered mail – or equivalent measure.

The need for a proper functioning of the cross-border service of documents mechanisms is properly highlighted in the Commission’s proposal, and new rules are suggested to further implement the system.

A recent volume, Current and future perspectives on cross-border service of documents, by Stefano Dominelli (Univ. of Milan, Dep. of International, Legal, Historical and Political Studies), explores and addresses the Commission’s proposals.

The functioning of Regulation 1393/2007 is in the first place reconstructed by the author in particular by taking into consideration the case law of a number of Member States. It is against this background that the proposed amendments are commented.

Amongst the numerous points, the book dwells upon proposed new art. 3a, and its possible impact. Acknowledging technical evolutions, communication and exchange of documents between transmitting and receiving agencies in the diverse Member States should in the future strongly rely on e-transmission. According to proposed new art. 3a, only if electronic transmission is not possible due to an unforeseen and exceptional disruption of the decentralised IT system, transmission shall be carried out by the swiftest possible alternative means. The author advises caution in the matter, as the Commission itself argues in the explanatory memorandum of the proposal that modern channels of communication are in practice not used due to old habits, legal obstacles, and lack of interoperability of the national IT systems. In this sense, the work proposes that, at least for time being, a transition to e-transmission between agencies should be encouraged as an alternative method of transmission, rather as being the only available option.

A number of proposals are made as regards the right of the addressee to refuse service on linguistic grounds. In the first place, with a solution supported in the volume, a new Annex to the Regulation should clearly set out the means and methods of the addressee to refuse service, a matter that is currently not expressly dealt with by the regulation.

The time frame for the addressee to refuse service based on linguistic grounds should become two weeks, rather than one, a solution that is strongly endorsed by the author of the volume as it is deemed to be a more satisfying point of balance between the opposing interests of the prospective plaintiff and the defendant.

Nonetheless, the work highlights that some issues that have emerged in the case law still are not addressed in the Commission’s proposal. In the first place, conflict of laws and international civil procedure issues are not referenced in the text, even though questions as the competent court before which violations of the rules on service can be invoked or which court has to investigate on the legitimate refusal to service based on linguistic grounds, have consistently been addressed by judges.

Additionally, the Commission’s proposal gives to this day no clear indication on the refusal to service based on linguistic grounds when the addressee is a corporation, a matter that, according to the author, should deserve at least some guidance in the recitals of the instrument.

The volume can be freely downloaded at https://ssrn.com/abstract=3259980

Thanks to Emmanuel Guinchard for the tip through his blog on European Civil Justice

On 7 December the Council of the European Union approved the General Approach on the Brussels IIa Recast proposed by the Presidency on 30 November 2018.

The text has been heavily discussed and has undergone several changes since the original Commission Proposal of 30 June 2016.

Importantly, the Council has agreed on:

• the complete abolition of exequatur;
• a limitation of jurisdiction for provisional measures to States where the child or property belonging to the child is present;
• allowing the cross-border recognition and enforcement of provisional measures granted by the court to where the child has been abducted when ordering the return;
• the harmonisation of certain rules on actual enforcement;
• making the time frame for return proceedings and their enforcement more stringent;
• providing for the hearing of children;
• clearer rules on the placement of children;
• clearer rules on the circulation of extra-judicial agreements.

See the press release here.

See the General Approach document here.

This probably means that the refinement of the final Regulation will be done within the next few months.

The European Law Institute (ELI) has launched in 2017 a project on The Protection of Adults in International Situations.

The adults to which the project refers are persons aged 18 or more who are not in a position to protect their interests due to an impairment or insufficiency of their personal faculties.

The project purports to elaborate on the resolution of 1 June 2017 whereby the European Parliament, among other things, called on the European Commission to submit ‘a proposal for a regulation designed to improve cooperation among the Member States and the automatic recognition and enforcement of decisions on the protection of vulnerable adults and mandates in anticipation of incapacity’.

The Commission has made known that it does not plan to submit such a proposal in the near future. At this stage, the Commission’s primary objective is rather the ratification of the Hague Convention of 13 January 2000 on the International Protection of Adults by the Member States that have not yet done so.

The ELI project builds on the idea that the Convention, which is currently in force for twelve States (ten of which are also Member States of the Union), generally provides appropriate answers to the issues raised by the protection of adults in situations with a foreign element. That said, the team of experts charged with the project has taken the view that it would be desirable for the Union to legislate on the matter, in a manner consistent with the Convention, with the aim of improving the operation of the latter among the Member States.

The ultimate goal of the project is to lay down the text of the measure(s) that the Union might take for that purpose.

While the project is still in progress, a position paper has been issued on 3 December 2018, signed by some of the members of the project team, to illustrate the main views emerged so far from the discussion.

The paper suggests that the Union should consider the adoption of measures aimed, inter alia, to:

(i) enable the adult concerned, subject to appropriate safeguards, to choose in advance, at a time when he or she is capable, the Member State whose courts should have jurisdiction over his or her protection: this should include the power to supervise guardians, persons appointed by court or by the adult (by way of a power of attorney), or having power ex lege to take care of the adult’s affairs;

(ii) enlarge the scope of the adult’s choice of law, so that he or she can also choose at least the law of the present or a future habitual residence, in addition to the choices currently permitted under Article 15 of the Hague Convention of 2000;

(iii) outline the relationship between the rules in the Hague Convention of 2000 and the rules of private international law that apply in neighbouring areas of law (such as the law of contract, maintenance, capacity, succession, protection against violence, property law, agency);

(iv) specify the requirements of formal and material validity of the choice of the law applicable to a private mandate, including the creation and exercise (and supervision by the courts) of such mandates;

(v) address the practical implications of a private mandate being submitted (by virtue of a choice of law, as the case may be) to the law of a State whose legislation fails to include provisions on the creation or supervision on such mandates, e.g. by creating a “fall-back” rule in cases of choice of the “wrong” law, which does not cover the matters addressed (or at least applying Article 15(1) of the Hague Convention of 2000);

(vi) extend the protection of third parties beyond the scope of Article 17 of the Hague Convention of 2000 to the content of the applicable law, and possibly also to lack of capacity (or clarifying that the latter question is covered by Article 13(1) or the Rome I Regulation);

(vii) make it easier for those representing and/or assisting an adult, including under a private mandate, to provide evidence of the existence and scope of their authority in a Member State other than the Member State where such authority has been granted or confirmed, by creating a European Certificate of Powers of Representation of an Adult (taking into account the experience developed with the European Certificate of Succession);

(viii) clarify and make more complete the obligations and procedures under Articles 22, 23 and 25 of the Convention in order to ensure ‘simple and rapid procedures’ for the recognition and enforcement of foreign measures; further reflection is needed to determine whether, and subject to which safeguards, the suppression of exequatur would be useful and appropriate for measures of protection issued in a Member State;

(ix) facilitate and encourage the use of mediation or conciliation.

The ELI project will form the object of a short presentation in the framework of a conference on The Cross-border Protection of Vulnerable Adults that will take place in Brussels on 5, 6 and 7 December 2018, jointly organised by the European Commission and the Permanent Bureau of the Hague Conference on Private International Law.