Conflictoflaws

The latest issue (21/1) of the Dutch journal Nederlands Internationaal Privaatrecht has been published. It includes the following articles.

Vriesendorp, W. van Kesteren, E. Vilarin-Seivane & S. Hinse, Automatic recognition of the Dutch undisclosed WHOA procedure in the European Union / p. 3-17

On 1 January 2021, the Act on Court Confirmation of Extrajudicial Restructuring Plans (‘WHOA’) was introduced into the Dutch legal framework. It allows for extrajudicial debt restructuring outside of insolvency proceedings, a novelty in the Netherlands. If certain requirements – mostly relating to due process and voting – are met, court confirmation of the restructuring plan can be requested. A court-confirmed restructuring plan is binding on all creditors and shareholders whose claims are part of that plan, regardless of their approval of the plan. WHOA is available in two distinct versions: one public and the other undisclosed. This article assesses on what basis a Dutch court may assume jurisdiction and if there is a basis for automatic recognition within the EU of a court order handed down in either a public or an undisclosed WHOA procedure.

Arons, Vaststelling van de internationale bevoegdheid en het toepasselijk recht in collectieve geschilbeslechting. In het bijzonder de ipr-aspecten van de Richtlijn representatieve vorderingen / p. 18-34

The application of international jurisdiction and applicable law rules in collective proceedings are topics of debate in legal literature and in case law. Collective proceedings distinguish in form between multiple individual claims brought in a single procedure and a collective claim instigated by a representative entity for the benefit of individual claimants. The ‘normal’ rules of private international law regarding jurisdiction (Brussel Ibis Regulation) and the applicable law (Rome I and Rome II Regulations) apply in collective proceedings. The recently adopted injunctions directive (2020/1828) does not affect this application.

 Nonetheless, the particularities of collective proceedings require an application that differs from its application in individual two-party adversarial proceedings. This article focuses on collective redress proceedings in which an entity seeks to enforce the rights to compensation of a group of individual claimants.

Collective proceedings have different models. In the assignment model the individual rights of the damaged parties are transferred to a single entity. Courts have to establish its jurisdiction and the applicable law in regard of each assigned right individually.

In the case of a collective claim brought by an entity (under Dutch law, claims based on Art. 3:305a BW) the courts cannot judge on the legal relationships of the individual parties whose rights are affected towards the defendant. The legal questions common to the group are central. This requires jurisdiction and the applicable law to be judged at an abstract level.

Bright, M.C. Marullo & F.J. Zamora Cabot, Private international law aspects of the Second Revised Draft of the legally binding instrument on business and human rights / p. 35-52

Claimants filing civil claims on the basis of alleged business-related human rights harms are often unable to access justice and remedy in a prompt, adequate and effective way, in accordance with the rule of law. In their current form, private international law rules on jurisdiction and applicable law often constitute significant barriers which prevent access to effective remedy in concrete cases. Against this backdrop, the Second Revised Draft of the legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises has adopted a number of provisions on private international law issues which seek to take into account the specificities of such claims and the need to redress the frequent imbalances of power between the parties. This article analyses the provisions on jurisdiction and applicable law and evaluate their potential to ensure effective access to remedy for the claimants.

Conference report

Touw, The Netherlands: a forum conveniens for collective redress? / p. 53-67

On the 5th of February 2021, the seminar ‘The Netherlands: a Forum Conveniens for Collective Redress?’ took place. The starting point of the seminar is a trend in which mass claims are finding their way into the Dutch judicial system. To what extent is the (changing) Dutch legal framework, i.e. the applicable European instruments on private international law and the adoption of the new Dutch law on collective redress, sufficiently equipped to handle these cases? And also, to what extent will the Dutch position change in light of international and European developments, i.e. the adoption of the European directive on collective redress for consumer matters, and Brexit? In the discussions that took place during the seminar, a consensus became apparent that the Netherlands will most likely remain a ‘soft power’ in collective redress, but that the developments do raise some thorny issues. Conclusive answers as to how the current situation will evolve are hard to provide, but a common ground to which the discussions seemed to return does shed light on the relevant considerations. When legal and policy decisions need to be made, only in the case of a fair balance, and a structural assessment thereof, between the prevention of abuse and sufficient access to justice, can the Netherlands indeed be a forum conveniens for collective redress.

 

Latest PhDs

Van Houtert, Jurisdiction in cross-border copyright infringement cases. Rethinking the approach of the Court of Justice of the European Union (dissertation, Maastricht University, 2020): A summary / p. 68-72

The dissertation demonstrates the need to rethink the CJEU’s approach to jurisdiction in cross-border copyright infringement cases. Considering the prevailing role of the EU courts as the ‘law finders’, chapter four argues that the CJEU’s interpretation must remain within the limits of the law. Based on common methods of interpretation, the dissertation therefore examines the leeway that the CJEU has regarding the interpretation of Article 7(2) Brussels Ibis in cross-border copyright infringement cases.

On 22 April 2021, Advocate General Campos Sánchez-Bordona presented his Opinion in the joined cases SC Gruber Logistics and Sindicatul Lucratorilor din Transporturi, C-152/20 and 218/20, in which he addresses in a pedagogical manner a number of issues of relevance to the choice of law to an individual employment contract under Article 8 of the Rome I Regulation as well as, indirectly, to the choice made in relation to a consumer contract under Article 6 of the Regulation.

Since numerous judgments and opinions were delivered at the Court of Justice at the end of April, we are only now reporting on the present cases, which are by no means less interesting than those previously covered.

 

Factual context

The factual contexts of the two requests for a preliminary ruling are somewhat similar. Both in the case C-152/20 and in the case C-218/20, the procedure pending before the national court (same for these two cases) concerns an action on payment of certain sums to the employees engaged as lorry drivers.

Notwithstanding the existence of some nuance discussed below, in both cases the employment contracts are said to contain a choice of law clause in favour of Romanian law.

In the former case, the employment contracts provided that the employees shall carry out their work in Romania and in “any location in the country and abroad as may be requested”. However, the employees argue that the place of performance lied within the territory of Italy and thus, according to Article 8 of the Rome I Regulation, it is the law of this Member State that governs at least their minimal wage.

In the latter case, the contract did not mention any specific place of performance. It is argued though that the employee carried out his work in Germany.

 

Preliminary questions and their assessment in the Opinion

It is in this context that the referring court decided to stay the main proceedings in these two cases and to refer to the Court nearly identical sets of three questions.

At the outset, AG notices that while the referring court is not asking for the interpretation of the Directive 96/71 (Posted Workers Directive 1996), it cannot be a priori excluded that the provisions thereof are of relevance in the context of the present cases. With respect to the terms and conditions of employment specified in its Article 3(1), the Directive would mandate the application of the law of the Member State where the work is carried out, rather than of the law applicable to the employment contract under the Rome I Regulation (points 29 to 33). However, in the absence of any clear information supporting the relevance of the Directive, AG deems it appropriate to follow the premise on which the national court relies: at present, it is the Rome I Regulation at stake (point 34).

In essence, the requests for a preliminary ruling raise three intertwined issues, namely: first, the interplay between the law chosen by the parties and the law that would be applicable in the lack of that choice, next, the qualification of the provisions on minimum wage as the “provisions that cannot be derogated from by agreement” within the meaning of Article 8(1) of the Regulation and finally, the admissibility of a compulsory (ex lege and de facto) choice of law clause in an individual employment contract.

 

1)    Interplay between the law chosen by the parties and the law that would be applicable in the lack of that choice

The first question as phrased by the referring court reads: “does the choice of law applicable to an individual employment contract exclude the application of the law of the country in which the employee has habitually carried out his or her work or does the fact that a choice of law has been made exclude the application of the second sentence of Article 8(1) of [the Rome I Regulation]?”

At first glance, the intention of the referring court may not seem perfectly clear. At least since the Rome Convention, the choice of law for the employment contract may not have the result of depriving the employee of the protection afforded to him (her) by provisions that cannot be derogated from by agreement under the law that would have been applicable in the absence of choice.

Indeed, as the referring court puts it in the requests for a preliminary ruling where it adopts a different perspective, by its first question it asks, in essence, whether Article 8(1) of the Rome I Regulation implies that a national court may override the parties’ choice of law where it appears from all the circumstances that the contract is more closely connected with a different country. It is not clear whether the reference to a ‘more closely connected’ country implies that the referring court is envisaging the application of Article 8(4) of the Regulation instead of Article 8(2) of the Regulation. This seems however to be irrelevant in the context of the issue at stake.

In his Opinion, mirroring the first question as phrased by the referring court, AG considers that the law chosen by the parties applies also with respect to “the protection afforded to [employee] by provisions that cannot be derogated from by agreement”, as long as the chosen law offers equal or higher standard of protection (point 107, first indent).

In actuality, AG seems to identify in a precise manner the point of hesitation that inspired the specific wording of the first question. For the referring court, the law applicable in the absence of choice seems to be starting point and the law chosen by the parties is seen as a subsequent intervening factor.

Regardless where such starting point is set, the law that would have been applicable in the absence of choice applies insofar as the law chosen by the parties is less protective towards the employee. This is arguably also the case under Article 6 of the Rome I Regulation.

 

2)    Qualification of the provisions on minimum wage as the “provisions that cannot be derogated from by agreement”

By its second question, the referring courts seeks to establish whether the provisions on minimum wage may be qualified as the “provisions that cannot be derogated from by agreement” within the meaning of Article 8(1) of the Rome I Regulation.

In this context, AG clarifies that the notion of “provisions that cannot be derogated from by agreement” is not equivalent to the notion of “overriding mandatory provisions” in the sense of Article 9 of the Regulation (points 64 to 68).

Answering the second question, he considers that the provisions on minimum wage of the country where the employee has habitually carried out his (her) work may in principle be qualified as “provisions that cannot be derogated from by agreement under the law that, in the absence of choice, would have been applicable”. This consideration is accompanied by a caveat. The prevalence of these provisions depends on their “configuration” in the national legal system in question, which it is for the referring court to verify (point 107, second indent).

 

3)    Admissibility of a compulsory (ex lege and de facto) choice of law clause in an individual employment contract

The third question contains some nuance. In essence, the referring courts is attempting to determine whether a compulsory (ex lege in the case C-152/20 and de facto in the case C-218/20) choice of law clause in an individual employment contract is admissible under Article 3 of the Rome I Regulation.

On the one hand, in the case C-152/20, the third questions reads: “[does] the specification, in an individual employment contract, of the provisions of the Romanian Labour Code does not equate to a choice of Romanian law, in so far as, in Romania, it is well-known that there is a legal obligation to include such a choice-of-law clause in individual employment contracts? In other words, is Article 3 of [of the Rome I Regulation] to be interpreted as precluding national rules and practices pursuant to which a clause specifying the choice of Romanian law must necessarily be included in individual employment contracts?”

On the other hand, in the case C-218/20, the third question is phrased as follows: “does the specification, in an individual employment contract, of the provisions of the Romanian Labour Code equate to a choice of Romanian law, in so far as, in Romania, it is well-known that the employer predetermines the content of the individual employment contract?”.

In his assessment of the third questions, AG distinguishes these two scenarios but evaluates them in the light of single core question: if a choice of law clause is compulsory, may one still consider that the parties have exercised their freedom of choice of the law applicable to their contract? (see, in that vein, points 98 and 104).

Ultimately, the proposed answer to the third question in the two cases is that Articles 3 and Article 8 of the Rome I Regulation are to be interpreted to the effect that a choice of the law applicable to an individual employment contract, explicit or implicit, “must be free for both parties” (“ha de ser libre para ambas partes”), which is not the case where a national provision requires a choice of law clause to be inserted in that contract. However, Articles 3 and 8 of the Regulation do not prevent such a clause from being drafted in the contract in advance by decision of the employer, to which the employee gives his consent (point 107, third indent).

The Opinion can be consulted here (the English version is not available).

Symeon C Symeonides recently published his regular piece with American Journal of Comparative Law  titled “Private International Law Bibliography 2020: U.S. and Foreign Sources in English.”

Arthur Poon recently published an article with International and Comparative Law Quarterly titled: “Determining the Place of Performance under Article 7(1) of the Brussels I Recast.”

The abstract reads as follows:

“This article calls for a reassessment of the methodology in determining the place of contractual performance under Article 7(1) of the Brussels I Regulation Recast. The first part of the article deals with Article 7(1)(a). It argues that in light of the adoption of autonomous linking factors under Article 7(1)(b), more types of contracts presently not covered within the ambits of Article 7(1)(b) should centralise jurisdiction at the places of performance of their characteristic obligations. The second part of the article considers the way Article 7(1) operates when there are multiple places of performance under the contract. The test devised by the Court of Justice of the European Union in this regard is not only difficult to apply, but the application of the test also often does not guarantee a close connection between the claim and the court taking jurisdiction. This article argues that when a claim is made in respect of a contractual obligation to be performed in more than one Member State, Article 4 should be applied instead of Article 7(1).”

EFFORTS (Towards more EFfective enFORcemenT of claimS in civil and commercial matters within the EU) is an EU-funded Project conducted by the University of Milan (coord.), the Max Planck Institute Luxembourg for Procedural Law, the University of Heidelberg, the Free University of Brussels, the University of Zagreb, and the University of Vilnius.

The EFFORTS Project tackles, notably, the Brussels Ibis Regulation and the Regulations on the European Enforcement Order, the European Small Claims Procedure, the European Payment Order, and the European Account Preservation Order. By investigating the implementation of these Regulations in the national procedural law of, respectively, Belgium, Croatia, France, Germany, Italy, Lithuania, and Luxembourg, the Project aims at enhancing the enforcement of claims through more efficient procedures, case management, and cooperation in cross-border disputes.

The second EFFORTS Newsletter has just been released, giving access to up-to-date information about the Project, save-the-dates on forthcoming events, conferences and webinars, and news from the area of international and comparative civil procedural law.

Regular updates are also available via the Project’s LinkedIn and Facebook pages.

Project JUST-JCOO-AG-2019-881802
With financial support from the Civil Justice Programme of the European Union

Coming up tomorrow – Book Launch: Choice of Law in International Commercial Contracts – 4 May 2021

 

The global PIL community is invited to celebrate the launch of the book “Choice of Law in International Commercial Contracts” (Oxford University Press, 2021). This study provides a definitive reference guide to the key choice of law principles on international contracts, including 60 national and regional reports written by experts from all parts of the world, and a dedicated commentary on the Hague Principles as applied to international commercial arbitration.

When: May 4, 2021 02:00 PM CEST

Where: Online (Zoom-Webinar)

Register here:

https://unilu.zoom.us/webinar/register/WN_ivzYmgFQQkSdUKZCEDRriQ

After registering, you will receive a confirmation email containing information about joining the webinar. The event will also be live streamed via YouTube; the link will be posted five minutes before the start time here.

 

The programme reads as follows:

 

14:00-14:10 – Welcome and acknowledgments | Daniel Girsberger

14:10-14:35 – Overview of the process | Daniel Girsberger and Marta Pertegás

14:35-15:00 – General Comparative Report, with a focus on Art. 3 | Thomas Kadner Graziano

15:00-15:10 – Further general matters | Jan L Neels

15:10-15:15 – Publisher’s address | Andrew Dickinson

15:15-15:20 – Regional perspective: Africa | Jan L Neels and Eesa A Fredericks

15:20-15:30 – Regional perspective: Asia | Yuko Nishitani and Béligh Elbalti

15:30-15:35 – Regional perspective: Australasia | Brooke Marshall

15:35-15:40 – Regional perspective: Europe | Thomas Kadner Graziano

15:40-15:50 – Regional perspective: Latin America | José A Moreno Rodríguez and Lauro Gama

15:50-15:55 – Regional perspective: North America | Geneviève Saumier

15:55-16:05 – HCCH, UNCITRAL and UNIDROIT perspectives | João Ribeiro-Bidaoui, Luca Castellani, and Anna Veneziano

16:05-16:15 – Future plans and concluding remarks | Agatha Brandão and Daniel Girsberger

16:15-16:45 – Q&A

 

More information about the book:

https://global.oup.com/academic/product/choice-of-law-in-international-commercial-contracts-9780198840107?cc=ch&lang=en&#

A 30% discount code will be available for all attendees.

 

On 14 April, the Working Group on the Practical Handbook on the Operation of the 2000 Protection of Adults Convention met for the first time. Comprised of experts with experience in the operation or implementation of the 2000 Protection of Adults Convention, the Working Group will meet via videoconference every two weeks, between 14 April and 23 June, in order to continue the development of a draft Practical Handbook on the operation of the Convention. More information on the 2000 Protection of Adults Convention is available here.

On 20 April, the Permanent Bureau announced the launch of the Legal Guide to Uniform Instruments in the Area of International Commercial Contracts, with a Focus on Sales, a joint publication of the Secretariats of UNCITRAL, UNIDROIT and the HCCH. The Legal Guide offers an overview of the principal legislative texts prepared by each organisation and illustrates how these texts interact to achieve the shared goals of predictability and flexibility. It is intended as a user-friendly resource for those interested in the adoption, application, and interpretation of uniform contract law. More information is available here.

On 22 April, the HCCH participated in the online international seminar “The Practical Operation of the Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction“, organised by the German Foundation for International Legal Cooperation (IRZ) and the Ministry of Education and Science of the Republic of Kazakhstan. The seminar was attended by more than 100 participants from Germany, Kazakhstan and Turkey. This event was a follow-up to the seminar on the HCCH 1980 Child Abduction Convention held on 9 December 2020. The recording of the seminar is available here.

On 29 April, Professor William Duncan, former Deputy Secretary General of the HCCH, received an honorary doctorate from Trinity College Dublin, the highest form of recognition from the College. This honour follows his Presidential Distinguished Service Award for the Irish Abroad in November 2020 and is a further tribute to Professor Duncan’s life-long contribution to academic research, law reform, and children’s rights both in Ireland and abroad. On behalf of the HCCH, the Permanent Bureau congratulates Professor Duncan on being awarded this prestigious honour.

 

Vacancy: The HCCH is currently seeking a(n) (Assistant) Legal Officer. The deadline for the submission of applications is this Sunday, 2 May 2021 (00:00 CEST). More information is available here.

 

These monthly updates are published by the Permanent Bureau of the Hague Conference on Private International Law (HCCH), providing an overview of the latest developments. More information and materials are available on the HCCH website.

Professor Yeo Tiong Min, SC (honoris causa) will be delivering the Yong Pung How Professorship of Law Lecture 2021 on Thursday, 6 May 2021, 5:00 to 6:00 pm (Singapore time). The title of the talk is ‘The Changing Global Landscape for Foreign Judgments.’ The synopsis is as follows:

There have been significant advances in the global landscape for the recognition and enforcement of foreign judgments in recent years. The two most significant international developments have been the coming into force in 2015 of the 2005 Hague Convention on Choice of Court Agreements, and the completion in 2019 of the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters. Singapore has responded to the global environment, in bringing the former Convention into force under Singapore law in 2016, and in making extensive amendments to the Reciprocal Enforcement of Foreign Judgments Act in 2019. 2020 also saw the publication of the second edition of the Multilateral Memorandum on Enforcement of Commercial Judgments for Money by the Standing International Forum of Commercial Courts and the Asian Principles for the Recognition and Enforcement of Foreign Judgments by the Asian Business Law Institute. The lecture will review these and other developments and their implications for Singapore law.

The webinar is free of charge. Further details and the link for registration may be found here.

Posted at the request of Sahil Verma, Managing Editor, Trade, Law and Development

Special Issue on Trade and Technology: Rebooting Global Trade for the Digital
Millennium
Issue 13.1 | Summer’21

Founded in 2009, the philosophy of Trade, Law and Development has been to generate and
sustain a constructive and democratic debate on emergent issues in international economic law
and to serve as a forum for the discussion and distribution of ideas. In keeping with these ideals,
the Board of Editors is pleased to announce “Trade and Technology: Rebooting Global Trade for the
Digital Millennium” as the theme for its next Special Issue (Vol. XIII, No. 1).

The WTO framework emerged out of the requirement to promote comparative advantages of
countries in the post-Industrial Revolution era. However, the developments that followed via
Ministerial Conferences, Council discussions and Appellate Body Reports have not moved away
from the traditional methods of trading involving brick-and-mortar factories, recognised fiat
currency, etc. With the unstoppable growth in digital innovation and dense proliferation of the
Internet and ICTs, International Economic Law and its framers must go back to the negotiating
table to chalk out a novel framework relevant for the new digital millennium.

E-Commerce emerged as the virtual marketplace connecting consumers to sellers across borders.
Artificial Intelligence (AI) holds enormous potential to solve efficiency deficits in manufacturing,
public health and education. 3D Printing is expected to meet demand shortages of essentials like
hearing aids. Blockchain and Digital Currencies could change payments and banking services as
we know it along with possible implications for trade finance opportunities. This Issue aims to
foster stimulating discussions on what these developments mean for trade as we know it.

In addition to these developments, the COVID-19 outbreak provides strong impetus for
countries to relook their digital trade and investment policies as reliance on digital resources
increase. While some steps have been taken to include digital technologies in regional trade
agreements, a more comprehensive and cohesive framework is yet to emerge in this regard.

Moreover, given the significance of these issues, governments across the world have begun
implementing rules and regulations for data privacy, cyber security, etc. The differences across
regulatory regimes could cause problems as to their interoperability across countries. The impact
of these regulations on the international trade level is yet to be seen.

An illustrative list of areas under the theme that authors could write upon are:

E-commerce
Artificial Intelligence Summer, 2021
Vol. XIII, No. 1
Implications for Trade Facilitation
Blockchain
Data Protection and Security
Competitiveness and Digital Taxation
Digital Divide between Advanced Economies and Developing World
Impact on Investment
Trade Policy
Implications for Gender Equality

These sub-issues are not exhaustive, and the Journal is open to receiving submissions on all
aspects related to Trade and Technology and its impact on the global trading system. This special
issue, currently scheduled for publication in Summer 2021, will provide an ideal platform to
deliberate on such issues related to trade and technology. Accordingly, the Board of Editors
of Trade, Law and Development is pleased to invite original, unpublished manuscripts for the
Special Issue on Trade and Technology: Rebooting Global Trade for the Digital Millennium for publication
as ‘Articles’, ‘Notes’, ‘Comments’ and ‘Book Reviews’.

Manuscripts may be submitted via e-mail or ExpressO.

In case of any queries, please feel free to contact us at: editors[at]tradelawdevelopment[dot]com.

This Thursday AG Campos Sánchez-Bordona delivered his Opinion in an Austrian case pertaining to the interpretation of the Succession Regulation and in particular to its Articles 69 (Effects of the European Certificate of Succession)  and 70 (Certified copies of the Certificate), namely in the case Vorarlberger Landes- und Hypotheken-Bank, C-301/20.

As the Opinion itself clarifies it at its point 2, the Court asked its AG to elaborate only on the third preliminary question, which reads as follows:

Must Article 69 read in conjunction with Article 70(3) of the EU Succession Regulation be interpreted as meaning that the legitimising effect of the certified copy of [an ECS] must be recognised if it was still valid when it was first submitted but expired before the requested decision of the authority, or does that provision not preclude national law if the latter requires the certificate to be valid even at the time of the decision?

According to Article 70(3) of the Regulation, the certified copies issued shall be valid for a limited period of six months, to be indicated in the certified copy by way of an expiry date.

As AG clarifies, the preliminary question seeks to determine the precise moment in relation to which the authority to which the certified copy is presented must verify the validity of this copy (point 25). In principle, two solutions already hinted in the preliminary question seem to be possible for AG: the certified copy has to be valid at the time of its submission to the authority or it has to be valid at the time of the decision (point 26).

However, as AG acknowledges, it has to be first decided whether the Succession Regulation determines itself the moment relevant for the validity of a certified copy or this issue is left for the Member States to decide (point 44).

Ultimately, he concludes that it is the Regulation itself that determines such relevant moment (point 46) and that the legitimising effect of the certified copy of an ECS must be recognized if it was still valid when it was first submitted to an authority, even where subsequently the validity of this certificate has expired (point 63).

This interpretation is accompanied by a caveat to the effect that, by way of exception, if there are reasonable grounds for considering that the ECS has been rectified, modified, withdrawn or suspended as to its effectiveness prior to the adoption of the requested decision, the authority may call for the production of a new certified copy or a certified copy with an extended period of its validity (point 76).

The Opinion can be consulted here (no English version yet).

Benedikt Windau, the editor of a fabulous German blog on civil procedural law, www.zpoblog.de, recently interviewed Federal Judge Dr Harmut Rensen, Member of the Tenth Panel of the division for civil and commercial matters at the German Federal Court of Justice (Bundesgerichtshof) on the experiences with video hearings in national an international patent matters in the pandemic. I allow myself to pick up a few elements from this fascinating interview in the following for our international audience:

The Tenth Panel functions as a court of first appeal (Berufungsgericht) in patent nullity proceedings and as a court of second appeal for legal review only (Revisionsgericht) in patent infringement proceedings. In both functions, particularly in its function as court of first appeal, actors from all over the world may be involved, and indeed, Judge Rensen reported about parties and their respective representatives and teams from the USA, Japan, South Korea, the UK, France, Italy and Spain during the last year.

Obviously, the start of the pandemic raised the question how to proceed, once physical hearings on site could no longer take place as before, since particularly in the appeal proceedings parties had usually appeared with several lawyers, patent lawyers, technical experts, interpreters etc., i.e. a large number of people had gathered in rather small court rooms, to say nothing of the general public and media. Staying all proceedings until an expected end of the pandemic (for which we are still waiting) would indeed have infringed the parties‘ fundamental procedural right to effective justice, abstaining from oral hearings and resorting to submission and exchange of written documents instead, as theoretically provided as an option under section 128 (2) German Code of Civil Procedure, would evidently not have been satisfying in matters as complex as patent matters (as well as probably in most other matters).

German civil procedural law allows for video hearings under section 128a (1) German Code of Civil Procedure. It reads (in the Governments official, yet may be not entirely perfect translation): „The court may permit the parties, their attorneys-in-fact, and advisers, upon their filing a corresponding application or ex officio, to stay at another location in the course of a hearing for oral argument, and to take actions in the proceedings from there. In this event, the images and sound of the hearing shall be broadcast in real time to this location and to the courtroom.“ The key word is „permit“. If the court „permits“ the parties etc. to proceed as described, it does not mean that the parties are required to do so. And indeed, parties applied for postponing scheduled hearings instead of going into video hearings. The presiding judge of the court has to decide on such a motion according to section 227 on „changes of date for scheduled hearings“. Section 227 (1) Sentence 1 reads: „Should substantial grounds so require, a hearing may be cancelled or deferred, or a hearing for oral argument may be postponed“. Sentence 2 reads: „The following are not substantial grounds: No. 1: The failure of a party to appear, or its announcement that it will not appear, unless the court is of the opinion that the party was prevented from appearing through no fault of its own“. Is this enough ground to reject the motion in light of the offer to go into video hearings? The Tenth Panel was brave enough to answer this question positively. Further, it was brave enough to overcome the friction between section 128a – permission for video hearings to be decided by the entire bench of the court at the opening of the first hearing – and section 227 (1) – decision about the motion to postpone a scheduled hearing by the presiding judge prior to that hearing. In the interest of progress in e-justice and effective access to justice in times of the pandemic, this is to be applauded firmly, all the more because the Panel worked hard, partly on its own initiative (as the general administration of the court would have been far too slow), to equip the court room with the necessary video technology: several cameras showing each judge and the entire bench, at the same time making sure that no camera reveals internal notes, the same for each party and team. The video conference tool that is currently used is MS Teams (despite all obvious concerns) as being the most reliable one in terms of broadcasting image and sound. The Panel invited to technical rehearsals the day before the hearing and for feed-backs afterwards, in order to improve itself and in order to build up trust, which seemed to have been quite successful. The specific nature of patent proceedings resulted in the insight that the function „screen sharing“ is one of the most helpful tools which will probably continue to be used in post-pandemic times. Sounds to me like examples of best practice. In sometimes rather „traditional“ environments of the German administration of justice, this is not a matter of course.

In relation to sovereignty issues when foreign parties are involved, the Panel takes the view that the territorial sovereignty of a foreign jurisdiction is not affected by a mere permission in the sence of section 128a because the place of the hearings can be considered still as being the locus of the court, i.e. Karlsruhe, Germany. Judge Rensen reported about talks between the Federal Ministry of Justice and its counterparts on the level of the states to the opposite, but as Judge Rensen pointed out, these are ongoing talks amongst ministerial officers, no court decisions or specific legislations that would bind the Panel. Things are cetainly more difficult when it comes to the taking of evidence. The Panel has done this only once so far, apparently within the scope of application of the EU Taking of Evidence Regulation. This case was specific, insofar as the testimony appeared to be entirely in line with and supported by undisputed facts and other testimonies, and these circumstances established a particularly solid overall picture about the point. This is why the Panel held the video testimony to be sufficient, which might mean that in mixed pictures the Panel might tend towards insisting on testimony in physical presence. In general, Judge Rensen supported judge-made progress, as opposed to specific legislation on legal assistance, as such legislation (like the EU legislation, including its latest recast on the matter) might lead to the misconception that such legislation would be required as a matter of principle in all cases to allow video hearings with foreign participants. For this reason, he pleaded for taking this factor into account before reforming section 128a (if at all), as such legislation would not be in sight in relation to a number of third states. At the same time the work of e.g. the HCCH on improving and modernising legal assistance under the HCCH 1970 Convention on the Taking of Evidence may be helpful nevertheless to promote and support video hearings in legal certainty, see e.g. the HCCH 2020 Guide to good practice on the use of video-link under the Hague Evidence Convention, but indeed the approach towards states staying outside these legal frameworks must be considered likewise.

On Tuesday, May 4, 2021, the Hamburg Max Planck Institute will host its tenth monthly virtual workshop in private international law at 11:00-12:30. Since January of this year, we are alternating between English and German language. Marta Pertegás Sender (Maastricht University) will speak, in English, about the topic Between Global and Regional Private International Law – Seamless Transitions From Regulations to Conventions? The presentation will be followed by open discussion. All are welcome. More information and sign-up here This is the ninth such lecture in the series, after those by Mathias Lehmann in June, Eva-Maria Kieninger in July, Giesela Rühl in September, Anatol Dutta in October, Susanne Gössl in November, Marc-Philippe Weller in December, Macjiej Szpunar in January,  Dagmar Coester-Waltjen in February, Horatia Muir Watt in March, and Burkhard Hess in April.  On June 1 we will host Tania Domej (Zurich University), on July 6 Hannah Buxbaum (Indiana University). Stay tuned! If you want to be invited to these events in the future, please write to veranstaltungen@mpipriv.de

Funded by Elite Network of Bavaria the International Doctorate Programme „Business and Human Rights: Governance Challenges in a Complex World“ (IDP B&HR_Governance) establishes an inter- and transdisciplinary research forum for excellent doctoral projects addressing practically relevant problems and theoretically grounded questions in the field of business and human rights. Research in the IDP B&HR_Governance will focus on four distinct areas:

• Global value chains and transnational economic governance
• Migration and changing labour relations
• Digital transformation
• Environmental sustainability

The IDP’s research profile builds on law and management as the core disciplines of B&HR complemented by sociology, political, and information sciences. Close cooperation with partners from businesses, civil society, and political actors will enable the doctoral researchers to develop their projects in a broader context to ensure practical relevance. The IDP’s curriculum, lasting for eight semesters, aims at contributing to the professional development of independent and critical researchers through a variety of courses, research retreats, colloquia, and conferences as well as the possibility of practical projects.

The IDP B&HR_Governance will include up to twenty doctoral researchers selected through a competitive process and sixteen principal investigators from Friedrich-Alexander-University Erlangen-Nürnberg (FAU), the University of Bayreuth and Julius-Maximilians-University Würzburg (JMU). The IDP involves law, management, sociology, political sciences and information systems.

The IDP B&HR_Governance will offer a comprehensive and innovative curriculum for the doctoral researchers. Its activities will commence on 1 November 2021.

The Acting Spokesperson of the IDP B&HR_Governance is Professor Markus Krajewski.

The IDP includes the following professors:

• University of Erlangen-Nürnberg: Anuscheh Farahat, Klaus Ulrich Schmolke, Patricia Wiater, Martin Abraham, Markus Beckmann, Evi Hartmann, Dirk Holtbrügge, Sven Laumer, Matthias Fifka, Petra Bendel, Sabine Pfeiffer
• University of Bayreuth: Eva Lohse, Thoko Kaime
• University of Würzburg: Isabel Feichtner, Eva Maria Kieninger

 

Call for Applications (12 doctoral research positions) – Deadline 15 June 2021

 

The IDP B&HR invites applications for 12 doctoral research positions (4-year contract) starting 1 November 2021.

Applicants need an excellent university degree at master’s level in a relevant discipline (law, management, sociology, political, or information science) and very good knowledge of English. International, intercultural, and practical experiences will be an asset.

An application comprises the following documents:

• Research proposal (in English, max. 5000 words)
• Curriculum Vitae (CV)
• Letter of motivation (in English, max. 1000 words)
• Writing sample, e.g. published article, thesis or seminar paper.
• Certificates of all university degrees with corresponding transcript of records

Applications must be sent in a single PDF document by 15 June 2021 to humanrights-idp@fau.de

The full Call for Applications can found here.

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

 

A. Dickinson: Realignment of the Planets – Brexit and European Private International Law

At 11pm (GMT) on 31 December 2020, the United Kingdom moved out of its orbit of the European Union’s legal system, with the end of the transition period in its Withdrawal Agreement and the conclusion of the new Trade and Cooperation Agreement. This article examines the impact of this realignment on private international law, for civil and commercial matters, within the legal systems of the UK, the EU and third countries with whom the UK and the EU had established relationships before their separation. It approaches that subject from three perspectives. First, in describing the rules that will now be applied by UK courts to situations connected to the remaining EU Member States. Secondly, by examining more briefly the significance for the EU and its Member States of the change in the UK’s status from Member State to third country. Thirdly, by considering the impact on the UK’s and the EU’s relationships with third countries, with particular reference to the 2007 Lugano Convention and Hague Choice of Court Convention.  The principal focus will be on questions of jurisdiction, the recognition and enforcement of judgments and choice of law for contract and tort.

 

S. Zwirlein-Forschner: Road Tolls in Conflict of Laws and International Jurisdiction – a Cross-Border Journey between the European Regulations

Charging tolls for road use has recently undergone a renaissance in Europe – mainly for reasons of equivalence and climate protection. The payment of such road tolls can be organized either under public or under private law. If a person resident in Germany refuses to pay a toll which is subject to foreign private law, the toll creditor can sue the debtor for payment at its general place of jurisdiction in Germany. From the perspective of international private law, such claim for payment of a foreign toll raises a number of complex problems to be examined in this article.

 

T. Pfeiffer: Effects of adoption and succession laws in US-German cases – the example of Texas

The article discusses how adoption and succession laws are intertwined in cases of adoptions of German children by US-parents in post WW2-cases, when Germany still had a contract based system of adoptions. Addressing the laws of Texas as an example, the author demonstrates that, so far, the legal effects of these adoptions have not been analysed completely in the available case law and legal writing. In particular, the article sets forth that, in relation to adoption contracts, Texan conflicts law (like the law of other US States) refers to the law of the adoption state so that the doctrine of a so-called hidden renvoi is irrelevant. Furthermore, in this respect, the renvoi is a partial one only in these cases: Under Texan conflicts law, the reference to the laws of the adoption state is relevant only for the status of being adopted, not for the effects of adoption, e.g. the question to whom the adopted is related; the latter issue is governed by the law of the domicile of the child, which is identical to the adoptive parents’ domicile, at least if this is also the adoptive family’s domicile after the adoption.

Furthermore, the author discusses matters of succession and argues: According to the ECJ’s Mahnkopf decision, a right of inheritance of the adopted child in relation to the biological parents under the laws applicable to the effects of the adoption, as provided for in Texas, has to be characterised as a succession rule, at least if that law provides for a mere right of inheritance, whereas all legal family relations to the biological family are cut off. As a consequence, such a “nude” inheritance right cannot suffice as a basis of succession under German succession laws. Even if one saw that differently, Texan succession conflicts law, for the purpose of succession, would refer to the law of the domicile of the deceased for movables and to the law of the situs for real property. Additionally, even if the Texas right of inheritance in relation to the biological parents constituted a family relationship, this cannot serve as a basis for a compulsory share right.

 

W. Voß: Qualifying Direct Legal Claims and culpa in contrahendo under European Civil Procedure Law

Legal institutions at the interface between contract and tort, such as the culpa in contrahendo or direct claims arising out of contractual chains, typically elude a clear, uniform classification even within the liability system of substantive national law. Even more so, qualifying them adequately and predictably under European civil procedure law poses a challenge that the European Court of Justice (ECJ) has not yet resolved across the board. In two preliminary rulings, the ECJ now had the opportunity to sharpen the borderline between contractual and noncontractual disputes in the system of jurisdiction under the Brussels I bis Regulation, thus defining the scope of jurisdiction of the place of performance of a contractual obligation and, at the same time, of jurisdiction over consumer contracts. However, instead of ensuring legal clarity in this respect, the two decisions rendered by the ECJ further fragment the autonomous concept of contract under international civil procedural law.

 

C. Thomale: International jurisdiction for rights in rem in immovable property: co-ownership agreements

The CJEU decision reviewed in this case note, in its essence, concerns the scope of the international jurisdictional venue for immovable property under Art. 24 No. 1 Brussels Ia-Regulation with regard to co-ownership agreements. The note lays out the reasons given by the court. It then moves on to apply these reasons to the Austrian facts, from which the preliminary ruling originated. Finally, some rational weaknesses of the Court’s reasoning are pointed out while sketching out a new approach to determining the fundamental purpose of Art. 24 No. 1 Brussels Ia-Regulation.

 

F. Rieländer: Solving the riddle of “limping” legal parentage: “Pater est” presumption vs. Acknowledgment of paternity before birth

In its judgment of 5/5/2020, the Kammergericht Berlin (Higher Regional Court of Berlin) addressed one of the main outstanding issues of German private international law of filiation. When children are born out of wedlock, but within close temporal relation to a divorce, the competing connecting factors provided for in Art. 19 (1) EGBGB (Introductory Act to the German Civil Code) are apt to create mutually inconsistent results in respect of the allocation of legal parentage. While it is firmly established that parenthood of the (former) husband, assigned at the time of birth by force of law, takes priority over any subsequently established filiation by a voluntary act of recognition, the Kammergericht held that where legal parentage is simultaneously allocated to the husband by one of the alternatively applicable laws and to a third person by way of recognition of paternity before birth according to a competing law, the (domestic) law of the state of the child’s habitual residence takes precedence. Though the judgment is well argued, it remains to be seen whether the controversial line of reasoning submitted by the Kammergericht will stand up to a review by the Bundesgerichtshof (German Federal Court of Justice). Nonetheless, the decision arguably ought to be upheld in any event. In circumstances such as those in the instant case, where divorce proceedings had commenced, recognition of legal parentage by a third person with the consent of the child’s mother and her husband is to be treated as a contestation of paternity for the purposes of Art. 20 EGBGB. Thus, according to domestic law, which was applicable to the contestation of paternity since the child’s habitual residence was situated in Germany, any possible legal ties between the child and the foreign husband of its mother were eliminated by a recognition of parentage by a German citizen despite suspicions of misuse. All in all, the judgment demonstrates once again the need for a comprehensive reform of German private international law of filiation.

 

Mark Makowsky: The attribution of a specific asset to the heir in the European Succession Certificate

According to Art. 63 (2) lit. b and Art. 68 lit. l of the European Succession Regulation, the European Certificate of Succession (ECS) may be used to demonstrate the attribution of a specific asset to the heir and shall contain, if applicable, the list of assets for any given heir. In the case at hand the ECS, which was issued by the Austrian probate court and submitted to the German land registry, assigned land plot situated in Germany solely to one of the co-heirs. The Higher Regional Court of Munich found, that the ECS lacked the presumption of accuracy, because the applicable Austrian inheritance law provides for universal succession and does not stipulate an immediate separation and allocation of the estate. Contrary to the court’s reasoning, however, Austrian inheritance law does allow singular succession of a co-heir, if (1) the co-heirs agree on the distribution of the estate before the probate court orders the devolution of property and (2) the court’s devolution order refers to this agreement. The presumption of accuracy of the ECS with respect to the attribution of specific assets is therefore not excluded by legal reasons. In the specific case, however, the entry in the land register was not based on the ECS, but on the devolution order of the Austrian probate court, which does not include a reference to a previous agreement of the co-heirs on the distribution of the estate. As a consequence, the devolution order proves that the land plot has become joint property of the community of heirs and that the ECS is therefore inaccurate.

 

R. Hüßtege: Internet research versus expert opinion

German courts have to determine the applicable foreign law by virtue of their authority. The sources of knowledge they rely on are based on their discretionary powers. In most cases, however, their own internet research will not be sufficient to meet the high demands that discretion demands. As a general rule, courts will therefore continue to have to seek expert opinions from a national or foreign scientific institute in order to take sufficient account of legal practice abroad.

 

A.R. Markus: Cross-Border Attachment of Bank Accounts in Switzerland and the European Account Preservation Order

On 18 January 2017 the Regulation on European Account Preservation Order (EAPO Regulation) came into force. It allows the creditor to place a security in a bank account so that enforcement can be carried out from an existing title or a title yet to be created. The provisions of the abovementioned Regulation stand beside existing national provisions with a similar purpose. As a non-EU member state, Switzerland does not fall within the scope of application of the EAPO Regulation and the provisional distraint of bank accounts is thus exclusively governed by national law. The present article illustrates in detail the attachment procedure under the Swiss Debt Enforcement and Bankruptcy Law. Comparative reference is made to the provisions of the EAPO Regulation. Finally, the recognition and enforcement of foreign interim measures, which is often crucial in cross-border cases, will be addressed. The article shows that there are considerable differences between the instruments provided by the Swiss law and those provided by the EU law.

 

J. Ungerer: English public policy against foreign limitation periods

Significantly different from the EU conflict-of-laws regime of the Rome I and II Regulations, the British autonomous regime provides for a special public policy exception in the Foreign Limitation Periods Act 1984, whose design and application are critically examined in this paper. When English courts employ this Act, which could become particularly relevant after the Brexit transition period, the public policy exception not only has a lower threshold and lets undue hardship suffice, it also leads to the applicability of English limitation law and thereby splits the governing law. The paper analyses the relevant case law and reviews the recent example of Roberts v Soldiers [2020] EWHC 994, in which the three-years limitation period of the applicable German law was found to cause undue hardship.

 

E. Jayme: Forced sales of art works belonging to the Jewish art dealer René Gimpel in France during the Nazi–period of German occupation – The Court of Appeal of Paris (Sept. 30, 2020) orders the restitution of three paintings by André Derain from French public museums to the heirs of René Gimpel

The heirs of the famous French art dealer René Gimpel brought an action in France asking for the restitution of three paintings by André Derain from French public museums. René Gimpel was of Jewish origin and lost his art works – by forced sales or by expropriation – during the German occupation of France; he died in a concentration camp. The court based its decision in favor of the plaintiffs on the “Ordonnance n. 45-770 du 21 avril 1945” which followed the London Inter-Allied Declaration of Dispossession Committed in Territories Under Enemy Occupation Control (January 5th 1943).

 

M. Wietzorek: First Experience with the Monegasque Law on Private International Law of 2017

This essay presents the Monegasque Law concerning Private International Law of 2017, including a selection of related court decisions already handed down by the Monegasque courts. Followed by a note on the application of Monegasque law in a decision of the Regional Court of Munich I of December 2019, it ends with a short summary.

We all know that the 3rd Nuremberg law banned marriages between Jews and Non-Jews. But did you know that it was first applied not by a German but by a Dutch court, as the law applicable under private international law? Didier Boden presents fifteen years of research – not just of court decisions, but also of administrative practice, with a focus on the personal fates of the couples involved. He combines this with a plea for a private international law that goes beyond doctrine and focuses on individual humans.

Talk (in German) on April 27, 5 pm CET.
More information and sign-up here.

 

Comparative Procedural Law and Justice (CPLJ) is a global project of the Max Planck Institute Luxembourg for Procedural Law, with the support of the Luxembourg National Research Fund (O19/13946847), involving more than one hundred scholars from all over the world.

CPLJ is envisioned as a comprehensive study of comparative civil procedural law and civil dispute resolution schemes in the contemporary world. It aims at understanding procedural rules in their cultural context, as well as at highlighting workable approaches to the resolution of civil disputes.

In this framework, the Max Planck Institute Luxembourg for Procedural Law will host its 4th CPLJ Webinar on 7 May 2021, 3:00 – 5:15 pm (CET).

The programme reads as follows:

Chair   Margaret Woo (Northeastern University and CPLJ Editor)

3:00 PM          Judith Resnik (Yale University)

            Puzzling about Trans-procedural Substantive Norms across Time and Domains

3:30 PM          Discussion

4:00 PM          Intermission

4:15 PM          Marie-Claire Foblets (Max Planck Institute for Social Anthropology)

            Extrajudicial Dispute Resolution in Europe: Anthropological Insights on the Impact of Religion and Tradition

4:45 PM          Discussion

5:15 PM          End of conference

The full programme is available here.

Participation is free of charge, but registration is required by 4 May 2021 via a short e-mail to events@mpi.lu.

(Image credits:  Rijksmuseum, Amsterdam)

 

Singapore-based Asian Business Law Institute (ABLI) is jointly holding a webinar with the Permanent Bureau of the Hague Conference on Private International Law (HCCH) on the HCCH 1970 Evidence Convention and Remote Taking of Evidence by Video-link on Tuesday, 1 June 2021 from 4pm to 5:15pm (SGT) or 10am to 11:15 am (CEST).

This event, organised in the context of the ongoing celebrations of the golden anniversary of the 1970 Evidence Convention, will discuss the practical challenges of the cross-border taking of evidence, as well as possible solutions to further facilitate cross-border proceedings in the coming years, including the use of video-link technology for the taking of evidence abroad under the 1970 Evidence Convention. A short introduction of the HCCH 1965 Service Convention will be provided at the end of the session.

Invited speakers include, in alphabetical order, Alexander Blumrosen, Partner at Polaris Law, Edmund J. Kronenburg, Managing Partner at Braddell Brothers LLP and Justice Anselmo Reyes, International Judge of the Singapore International Commercial Court. Dr João Ribeiro-Bidaoui, First Secretary at the HCCH, and the Representative for the Regional Office for Asia and the Pacific (ROAP) of the HCCH, Professor Yun Zhao, will also speak at the session.

More details about the programme can be found here.

Readers of this blog can enter promo code ABLISG and select ticket category ABLI Founding Partners when registering online to enjoy 10% discount.

Inquiries about the programme or how to register can be directed to Catherine at catherine_shen@abli.asia.

By its preliminary question referred to the Court of Justice in the case Volvo, C-30/20, the referring court was indenting to clarify whether Article 7(2) of the Brussels I bis Regulation has to be interpreted as establishing only the international jurisdiction of the courts of the Member State for the ‘place where the harmful event occurred or may occur’ or establishing also national territorial jurisdiction. This question arose in the context of the proceedings on a follow-on action, based on the Commission’s decision, by which the applicant claims damages for loss and damage caused by certain anticompetitive practices.

In his Opinion delivered this Thursday, Advocate General Richard de la Tour not only answers the preliminary question in the affirmative (points 35 to 48) but also addresses other issues pertaining to the jurisdictional side of the private enforcement of EU competition law.

On the one hand, Advocate General explains how one should precisely determine the place where the damage occurred in order to identify the court having jurisdiction under Article 7(2) of the Brussels I bis Regulation (points 49 to 111). As he acknowledges at point 70 of the Opinion, the finding that the damage occurred within the market affected by the anticompetitive practices, is not, on its own, sufficient to identify the court having territorial jurisdiction to hear an action pertaining to these practices. For this very reason, the Opinion provides a detailed guidance on how to identify a competent court.

On the other hand, AG Richard de la Tour examines whether and to what extent the Member States are authorized to concentrate jurisdiction for the actions on anticompetitive practices (points 112 to 130).

The Opinion can be consulted here (so far the English version is not available).

This Thursday, the Court of Justice delivered its judgment in the case Oeltrans Befrachtungsgesellschaft, C-73/20, on the interpretation of the Insolvency Regulation and the law applicable to detrimental acts. This judgment, pertaining to Articles 4(2)(m) and 13 of the Regulation No 1346/2000, completes therefore the case law constituted most notably by the judgment in the case Vinyls Italia, C-54/16.

Despite the fact that the recent judgment concerns the Regulation No 1346/200, which has been repealed by Regulation 2015/848, it is and will remain of relevance: the latter Regulation contains provisions that are equivalent to the aforementioned Articles 4(2)(m) and 13.

 

Legal and factual context

Oeltrans Befrachtungsgesellschaft and Tankfracht GmbH are both established in Germany and belong to the same group of companies.

An inland waterway contract exists between Tankfracht and E.A. Frerichs, established in the Netherlands. Under this contract, Tankfracht owes a payment of a fixed amount to E.A. Frerichs.

By the end of 2010, Oeltrans Befrachtungsgesellschaft pays to E.A. Frerichs, ‘on the order of Tankfracht’, the sum owed by this company under the inland waterway contract.

Following the opening in Germany of the insolvency proceedings in relation to Oeltrans Befrachtungsgesellschaft, its liquidator brings an application for repayment on that amount with interests, on the ground that the transaction should be set aside by virtue of insolvency.

After a lapse of a certain amount of time, the regional court finds against E.A. Frerichs under German law, in accordance with the form of order sought by the liquidator. Next, deciding on appeal brought by E.A. Frerichs, the second instance court, also on the basis of German law, varies the decision of the regional court and dismisses the application on the basis of the plea that it was timebarred. Finally, by its appeal on a point of law (Revision), Oeltrans Befrachtungsgesellschaft seeks to have the decision of the regional court reinstated by the referring court.

 

Questions/issues raised by the request for a preliminary ruling

At the outset, the referring court explains that, under German insolvency law, the payment made by Oeltrans Befrachtungsgesellschaft is voidable.

However, under Article 13 of the Regulation No 1346/2000, its Article 4(2)(m) does not apply where the person who benefited from an act detrimental to all the creditors provides proof that the said act is subject to the law of a Member State other than that of the State of the opening of proceedings and that law does not allow any means of challenging that act in the relevant case.

Invoking that provision, E.A. Frerichs contends that the contested payment is to be assessed under Netherlands law. Under this law, the payment is said not to be voidable.

Faced with this contention, the referring court indicates that, under the Rome I Regulation, the inland waterway contract is governed by Netherlands law. For the referring court, the issue to be determined is thus whether the law applicable to a contract under this Regulation also governs, in the context of Article 13 of the Regulation No 1346/2000, the payment made by a third party in performance of a contracting party’s contractual payment obligation.

The referring court considers that it is facing a question on the scope of the lex contractus in the context of insolvency proceedings: under Article 12(1)(b) of the Rome I, the law applicable to the contract also governs the performance of the obligations laid down in that contract. The question remains whether this is still the case in the context of insolvency proceedings. If the creditor’s claim is satisfied not by the other party to the contract but, as in the present case, by a third party, the question arises all the more as to whether the lex contractus applies.

Additionally, the referring recognizes the existence of a doctrinal debate as to whether the law applicable to the performance of a contractual obligation is determined by reference to the contract or separately to the act of performance.

Ultimately, the referring court addresses a following question to the Court of Justice: are Article 13 the Regulation No 1346/2000 and Article 12(1)(b) of the Rome I Regulation to be interpreted as meaning that the law applicable to a contract under the latter Regulation also governs the payment made by a third party in performance of a contracting party’s contractual payment obligation?

 

The judgment and the reasoning of the Court

In this case, decided without an Opinion from the Advocate General, the Court answered in affirmative the question of the referring court.

To reach that answer, the Court referenced its case law according to which Articles 4 and 13 of the Regulation No 1346/2000 constitute a lex specialis in relation to the Rome I Regulation and must be interpreted in the light of the objectives pursued by the former Regulation (paragraphs 25, 26 and 30).

Having set such starting point for its reasoning, the Court proceeded to interpret the Regulation No 1346/2000 in order to address the question whether a payment made in performance of a contractual obligation is governed by the law applicable to that contract. At paragraphs 31 to 34, it based its finding according to which a payment made (also by a third party) in performance of a contracting party’s contractual obligations is governed by the lex contractus by the considerations on the (legitimate) expectations of the party to the contract having received the payment.

At paragraphs 35 to 38, the Court explained that this finding is corroborated by Article 12(1)(b) of the Rome I Regulation.

Ultimately, the Court ruled that the answer to the preliminary question is that Article 13 of the Regulation No 1346/2000 and Article 12(1)(b) of the Rome I Regulation must be interpreted to the effect that the law applicable to the contract on the basis of the latter Regulation governs also the payment made by a third party in performance of a contracting party’s contractual obligations where, in the context of insolvency proceedings, this payment is contested as an act detrimental to all the creditors.

A cursory first reading of the judgment might lead some to conclude that the Court drew a finding of a general nature from Article 12(1)(b) of the Rome I Regulation, according to which the performance of a contractual obligation is generally (and in EU private international law in particular) governed by the law applicable to the contract that constitutes the base of this obligation. Thus, the reference to Article 12(1)(b) of the Rome I Regulation in the Court’s answer would simply mirror the preliminary question, as formulated by the referring court (both Article 13 of the Regulation No 1346/2000 and Article 12(1)(b) of the Rome I Regulation being invoked in this question). Others may see this reference as implying that the conflict of laws rules of the latter Regulation are still of relevance in the context of insolvency proceedings. It is yet to be seen which alternative will be supported by a more refined lecture of the judgment.

The judgment can be consulted here.

23 teams from al over the globe are participating in the Pax Moot that is currently ongoing (from 21 to 23 April). The case concerns private international law aspects of the race to a Covid vaccine. It involves the application of various EU and international instruments.

Spectators are welcome at the semifinals and finals on Friday 23 April. You can join by first logging into your own Zoom account and then clicking the link on the schedule to the relevant session. After the final round Ms Pia Lindholm of the European Commission will address the students. Then the winners of the written rounds, the oral rounds and the best pleader will be announced.