EAPIL blog

In a recent ruling (No 120 of 23 February 2021, unreported) the Court of Appeal of Piraeus was asked to determine whether, for the purposes of exequatur under Regulation No 44/2001 (Brussels I), a Maltese ship mortgage is considered an authentic instrument.

The issue had the following practical ramifications. A classification of the mortgage as an authentic instrument for the purposes of the Regulation would entail that immediate enforcement ought to be stayed by virtue of Article 37 as a result of the lodging of an appeal. Instead, if the ship mortgage were seen as falling outside the scope of the Regulation, domestic law would apply, which does not provide for an automatic stay of execution if the debtor challenges the enforceability of the foreign title.

The Facts

A Greek bank granted in 2011 a loan of nearly 12 million Euros to a company seated in La Valetta (Malta). In oder to secure the bank’s claim, a mortgage was registered on a ship belonging to the debtor, registered in Malta. Due to delays in payment, the bank seised the Court of First Instance of Piraeus seeking a declaration of enforceability of the ship mortgage. It relied for this on Article 905 Greek Code of Civil Procedure.

The court granted the application. The company filed a third-party opposition, i.e. the remedy available under Greek law, arguing that the court had failed to apply the Brussels I Regulation. The move was successful. The bank appealed.

Legal Framework

Article 57(1) of the Brussels I Regulation reads as follows:

A document which has been formally drawn up or registered as an authentic instrument and is enforceable in one Member State shall, in another Member State, be declared enforceable there, on application made in accordance with the procedures provided for in Articles 38, et seq. The court with which an appeal is lodged under Article 43 or Article 44 shall refuse or revoke a declaration of enforceability only if enforcement of the instrument is manifestly contrary to public policy in the Member State addressed.

The Report by Jenard and Möller on the 1988 Lugano Convention  1988 (para. 72) posed the following conditions for the application of Article 50 of the Lugano Convention, which addresses the same issue as Article 57 of the Brussels I Regulation (formerly, Article 50 of the 1968 Brussels Convention):

The authenticity of the instrument should  have  been  established  by a public  authority; this  authenticity  should  relate to  the  content  of  the  instrument  and  not  only,  for  example,  the  signature; the  instrument  has to be enforceable  in  itself  in  the  State in  which  it originates.

In Unibank, the CJEU ruled as follows:

An acknowledgment of indebtedness enforceable under the law of the State of origin whose authenticity has not been established by a public authority or other authority empowered for that purpose by that State does not constitute an authentic instrument within the meaning of Article 50 of the [1968 Brussels Convention].

Maltese law regulates the matter under Chapter 234 of the Merchant Shipping Act. Article 38(1) provides that:

A registered ship or a share therein may be made a security for any debt or other obligation by means of an instrument creating the security (in this Act called a “mortgage”) executed by the mortgagor in favour of the mortgagee in the presence of, and attested by, a witness or witnesses.

Article 41(2) states that

A registered mortgage shall be deemed to be an executive title for the purposes of Article 253 of the Code of Organization and Civil procedure.

The latter provision, in turn, regards the following as enforceable titles:

… (b) contracts received before a notary public in Malta, or before any other public officer authorised to receive the same where the contract is in respect of a debt certain, liquidated and due, and not consisting in the performance of an act.

The Ruling

The company submitted a legal opinion signed by a foreign lawyer, according to which a ship mortgage is considered as a ‘public deed’, given that it was received in accordance with the law by a public functionary, entrusted to give full faith and credit to the document in question. In addition, the authenticity of the signature of the ship registrar had been certified by an apostille pursuant to the Hague Apostille Convention, which referred to the ship mortgage as a public deed.

The company referred also to the Scottish public register of deeds as an example of authentic instrument, in order to convince the court to consider the ship mortgage as an authentic instrument for the purposes of the Brussels I Regulation.

The Court of Appeal of Piraeus granted the bank’s appeal. Relying on Article 57 of the Brussels I Regulation, the Jenard-Möller Report and the judgment of the Court of Justice in Unibank, it noted that an authentic instrument is a document which has been formally drawn up or registered as such.

In addition, Che court emphasized on the lack of any involvement of the Register of Ships in regards to the content of the mortgage. Contrary to the first instance judgement, the court considered that the mere registration in the Valetta ship registry does not suffice. The act of the Register of Ships does not attribute the nature of an authentic instrument to a document drawn and signed by two private parties.

The Court made extensive reference to the opinion of the Advocate General La Pergola in the Unibank case, stating that the authenticity of the document’s content had not been examined by the registrar. In other words, the sole registration without any examination of the content, does not attribute to the ship mortgage the nature of an authentic instrument. It is just a formal procedure for the purposes of solemnity and publicity.

In addition, the Court of Appeal clarified that the reference of the registrar to the document as a public deed does not hinder the court to examine the ship mortgage from the Regulation’s point of view.

Comments

The core issue is whether the procedure followed for the registration of a Maltese ship mortgage entails any participation of a public authority, i.e. the decisive factor according to the Court of Justice in Unibank.

The Court of First Instance answered in the affirmative, whereas the Court of Appeal took the opposite view.

The judgment demonstrates the variety of legal documents balancing between the private and public divide. It serves as an additional example for the interpretation of Article 57 Brussels I Regulation and Article 58 Brussels I bis Regulation.

On 8 April 2020, the UK formally applied to accede to the Lugano Convention. The one year period recommended for deciding on this application in Article 72(3) of the Convention has thus expired on 8 April 2021, causing harm for judicial cooperation.

However, things seem to start moving. According to a report in the Financial Times, the European Commission wants to give today (12 April 2021) a positive assessment of the British application, despite its earlier reluctance to grant the UK’s application. This change of mood seems to be the result of technical analysis carried out on the consequences of the British accession or non-accession. The article cites an unnamed EU diplomat who emphasises the Union’s awareness of the “practical benefits of having Britain in a co-operation pact that prevented legal disputes from being unnecessarily messy”.

This is a hopeful sign that judicial cooperation in civil and commercial matters may continue after Brexit. But let us not rush to quick conclusions. The final decision on the EU’s position lies with the European Parliament and Council under Articles 81(1), (2) and 218(5), (6)(a)(v) TFEU. It will be particularly interesting how Member States will vote in the Council.

This post was contributed by Bukhard Hess, who is a director of the Max Planck Institute Luxembourg.

Gilles Cuniberti has kindly invited me to comment on the decision of the Paris Tribunal Judiciaire from a German perspective – here are my reflections on this interesting case:

1. Under German law, a contract retaining an arbitrator is a private law contract for services related to arbitration. German law clearly separates the underlying contract with the arbitrator from the procedural functions (including obligations) of the arbitrator within the arbitration proceedings (most recently: Ruckdeschler & Stooß, Die vorzeitige Beendigung der Schiedsrichtertätigkeit, Festschrift Kronke (2020), p. 1517 – 1519). Therefore, the contract retaining an arbitrator falls in the scope of the arbitration exception set out at Article 1(2) of the Brussels Ibis Regulation only provided there is an express arbitration clause in the service contract with the arbitrator. Actions for damages against the arbitrator for the breach of the service contract (based on § 280 and 281 of the German Civil Code) are not ancillary proceedings within the meaning of Recital 12 para 4 of the Brussels Ibis Regulation. The arbitral tribunal does not have jurisdictional powers to decide contractual damage claims brought against an arbitrator. Such claims are, in fact, not related to the arbitration proceedings, the breach of the arbitrator’s duties merely amounting to an incidental issue. In this regard, I agree with the decision of the Tribunal Judiciaire de Paris.

2. Under German law, the service contract with the arbitrator usually establishes contractual relationships with both parties, cf. Schack, Internationales Zivilprozessrecht (8th ed. 2021), para 1461; Schlosser, Recht der Internationalen, privaten Schiedsgerichtsbarkeit (2nd ed. 1989), para 491. Specifically, § 675, 611 and 427 of the BGB apply to this contract (there is a debate whether the contract qualifies as a contract sui generis). The situation is not different when an arbitration organization is involved as the organization concludes the contract with the arbitrators on behalf of the parties (Stein/Jonas/Schlosser, Vor § 1025 ZPO (Commentary, 23rd ed. (2014), para. 17). As I have previously stated, German doctrine clearly distinguishes the contractual relationship between the parties and the arbitrator from the procedural functions (“Amt”) of the arbitrator. The latter is regulated by the lex arbitri and concerns the procedural role of the arbitrator. If the parties do not agree on specific (institutional) rules, § 1034 -1039 of the Code of Civil Procedure apply.

3. If one agrees that the Brussels I bis Regulation applies, the place of performance is to be determined according to its Article 7 no 1b, 2nd indent. When it comes to a contract for the services of an arbitrator, one might consider an agreed place of performance at the seat of the arbitral tribunal (when the parties agreed on the place where the arbitration proceedings take place). Otherwise, the seat of arbitration might be the place where the arbitrators render their services. As Article 7 no 1 places much emphasis on the factual place of performance, much depends on the factual situation – especially in an instance where the arbitral tribunal holds virtual hearings and deliberates online. In this case, one might consider localizing the place of performance at the law office of each individual arbitrator.

In the case at hand, the claim was based on an alleged violation of the duty to disclose a conflict of interests. The assessment of such a violation entailed investigations also regarding the activities of the arbitrator’s law firm, localized at the place of the law firm’s office. However, according to the case law of the ECJ, under Article 7 no 1 the place of the main provision of service – and not the place where the concrete contractual obligation was breached – is decisive for the purposes of establishing jurisdiction (C-19/09 Wood Floor Solutions, cf. Hess, Europäisches Zivilprozessrecht, 2nd ed. 2021, § 6, para 6.56). Consequently, I would agree with the Paris court that the place of performance was Germany.

4. Finally, I would like to address one additional aspect: Does the decision of the French court that located the place of performance in Germany bind the German courts? The ECJ addressed this issue in case C-456/11 (Gothaer Versicherungen, paras 36 et seq.). It held that a German court was bound by a decision of a Belgian court on the validity and the derogative effects of a jurisdiction clause designating the Dutch courts as the competent courts (see Hess, Europäisches Zivilprozessrecht, 2nd ed. 2021, § 6, paras 6.206 – 6.207). In the case at hand, the situation is different as the French court stated that the place of performance of the contract was located in Germany, not in France. However, one might consider that this statement of the Paris court is binding on the parties and might be recognized as binding under Article 36 of the Brussels I bis Regulation in the German proceedings. I am well aware that this effect transcends the current case law under the Brussels I bis Regulation. However, it would be a consequence of Gothaer Versicherungen to assume a binding force of the French judgment rejecting the lawsuit as inadmissible. This binding force would prevent a déni de justice by a German court. Yet, it remains to be seen whether such binding force is compatible with the case law of the ECJ according to which each court of the EU Member States has to assess ex officio whether it has jurisdiction under the Brussels I bis Regulation (C-185/07, Allianz).

Among the goals pursued by the Max Planck Institute Luxembourg for International, European and Regulatory Procedural Law is to promote research and academic exchange with foreign scholars.

In this framework, to assist particularly young scholars further advance their research activity, the Max Planck Institute Luxembourg offers a limited number of scholarships for foreign doctoral candidates to support their research stay at the Institute for up to six months in the calendar year 2022.

Eligibility

To be eligible for the scholarship, applicants must be doctoral candidates carrying out research activity within the Institute’s various areas of research, and intend to be affiliated either to the Department of European and Comparative Procedural Law or the Department of International Law and Dispute Resolution. While proficiency in English is compulsory, the call is also open to doctoral candidates writing their thesis in a language other than English.

Application

To apply, the interested candidates meeting the requirements of the call must submit the following documents, in English: a cover letter (max. 1 page), stating the motivation for their application, the correlation between the topic of their research and the Institute’s areas of research, and the desired time frame for the scholarship stay; an up-to-date curriculum vitae, with an indication of the class of degree awarded (undergraduate and postgraduate, if relevant); a summary of the PhD project (max. 2 pages), including subject, description and work plan; two letters of recommendation (including one from the PhD supervisor, with his/her contact details).

Grant and Benefits

The scholarship is paid in monthly instalments of 1.500 €. The selected applicants will be offered a workstation in the reading room. They will also have the opportunity to participate in the regular scientific events hosted at the Institute, other activities and access to the Institute’s library. During the funding period, the presence of the Scholarship Holder at the Institute is required.

Deadline for Applications

15 May 2021

Application Details

Please follow this link, apply online and upload all required documents.

Contact

Christiane Göbel and Eva Dobay at scholarship@mpi.lu.

On 31 March 2021, the Paris main first instance court (tribunal judiciaire, formerly tribunal de grande instance) ruled on the international jurisdiction of French courts to determine arbitrators’s liability. It held that it was a contractual claim in the meaning of Article 7(1)(b) of the Brussels I bis Regulation and declined jurisdiction on the ground that the arbitrator had provided his service in Germany. This post is based on a press release of the court.

Background

The case was concerned with distribution contracts in the automobile industry.  The contracts contained clauses providing for ICC arbitration in Paris under German law. The origin of the parties is unknown, but none of them was French.

After two contracts were terminated, an arbitration was initiated. The parties agreed that the hearings would be held in Germany.

The resulting award, however, was challenged before French courts, and ultimately set aside on the ground that one arbitrator had failed to disclose certain relationships between his law firm and one of the parties to the arbitration.

The arbitrator was sued in Paris for damages.

Arbitration Exception?

The first issue was whether the European law of jurisdiction applied. The Brussels Ibis Regulation includes an “arbitration exception”. Did a claim seeking to establish the liability of the arbitrator fall within it?

The Paris court held that it did not. It ruled that the claim was based on the “arbitration contract” existing between the parties and the arbitrators, and that this contract was distinct from the arbitration. Thus, the Brussels Ibis Regulation applied.

This is the most unconvincing part of the judgment. The proposition that the arbitration contract is unrelated to arbitration is really surprising. Aren’t the obligation of impartiality and independance, and the related disclosure obligation, found in arbitration legislations?

More generally, the distinction established by the European Court of Justice has been between the substantive rights that the arbitration proceedings are meant to settle, and proceedings ancillary to arbitration. So, in Van Uden for instance, the Luxembourg Court explained that proceedings relating to “the appointment or dismissal of arbitrators” fell within the exclusion. Could it really be that proceedings seeking damages for wrongful appointment of arbitrators do not?

Contractual Claim?

Let’s admit, for the sake of the argument, that the Brussels I bis Regulation applied. Was it, then, a contractual claim? The Paris court held so on the basis of the existence of an “arbitration contract” between the arbitrator and the plaintiff.

The existence of such a contract, however, is disputed. It is more or less convincing depending on the particulars of the case, that I do not know. If the parties and the arbitrators had entered into Terms of reference, which should be the case in ICC arbitration, the characterisation made sense.

In other cases, however, the existence of a contractual relationship is less clear, in particular as between a party appointed arbitrator and the party who did not appoint him.

Place of Provision of the Service

If the claim was contractual, the relevant contract was quite clearly a provision of service in the meaning of Article 7(1)(b) of the Brussels I bis Regulation. It was therefore necessary to determine the place of the provision of the service.

The court first considered the provisions of the “contract” (it is unclear which contract: the arbitration agreement? the terms of reference?), which stated that “the place of the arbitration is Paris” and “The arbitral award and procedural orders are deemed to be rendered at the place of arbitration, that is Paris”. The court held, however, that these provisions did not reveal the choice of the parties to locate the provision of the services in Paris.

The court then assessed where the arbitrator had actually provided his intellectual service. The court found that it had been provided in Germany. The hearings had been held there, and the deliberations are taken place there. The court declined jurisdiction.

What is Next?

So it seems that the aggrieved party should now sue the arbitrator in Germany.

But will German courts also consider that the claims fall within the scope of the Brussels I bis Regulation and, if not, would they retain jurisdiction?

As announced earlier on this blog, the EAPIL Founding Conference will eventually take place on 2, 3 and 4 June 2022 in Aarhus, hosted by the Aarhus University.

Registration for the conference is now open. See here for further details.

A general presentation of the conference can be found here. See here for the full program as well as for details on venue, travel and accommodation.

For more information, please write an e-mail to Morten Midtgaard Fogt at mmf@law.au.dk.

On 15 and 16 April 2021, the GLaw Research Network (Maastricht University) will host an online workshop on Article 47 of the EU Charter and effective judicial protection: The Court of Justice’s perspective.

Senior and junior academics specialising in EU law will discuss various aspects of the impact of Article 47 Charter on the EU constitutional order. On the first day of the workshop, the presentations will cover constitutional aspects of Article 47 of the EU Charter. On the second day, the speakers will discuss the application of this provision in selected EU policy areas.

The principle of effective judicial protection is one of the cornerstones of the EU legal order. Mentioned by the Court of Justice for the first time in the 1980s, and originally emanating from Articles 6 and 13 ECHR, this principle had a pivotal role in ensuring access to adequate remedies to protect the rights deriving from Union law. Since its inception, this principle was linked also to the protection of the rule of law, one of the founding values of the EU. Effective judicial protection is therefore one of the facets of the EU constitutional identity.

Following the entry into force of Lisbon Treaty, this principle has been constitutionalised in Article 19 TEU and Article 47 of the EU Charter of Fundamental Rights, the latter laying down the right to an effective remedy and to a fair trial. Currently, Article 47 of the EU Charter is the most invoked EU Charter provision before national and EU courts. Article 47 Charter has also been at the centre of recent EU jurisprudence on the protection of the rule of law in the EU. This case law has confirmed the pivotal role of effective judicial protection in the EU architecture. It is not an overstatement that Article 47 is almost ‘omnipresent’ in the EU judgments as a result of a growing number of preliminary rulings and direct actions regarding the application of that provision. Novel questions thus arise regarding the impact of Article 47 Charter on the EU constitutional order, which require scientific observation and reflection. 

The full program and details on registration are available here.

The new issue of the Revue Critique de Droit International Privé (1/2021) is out.

It contains four articles and numerous case notes. The editorial by Horatia Muir Watt (Sciences Po), Dominique Bureau (University of Paris II) and Sabine Corneloup (University of Paris II) will soon be available in English on the Dalloz website (Dans le désordre planétaire…).

In the first article, Didier Boden (University of Paris 1 Panthéon-Sorbonne) proposes to rethink the private international law lexicon in order to achieve a uniform analysis of the coordination between legal orders (« Erga- » : Contribution sémantique et lexicale à une étude unifiée des relations entre ordres juridiques).

Private international law and the other sets of rules of a legal order which touch upon its relations with other legal orders are poorly named and poorly defined. This article proposes to remedy that lexical impropriety and that semantic deficiency by presenting a new collection of names and a new collection of definitions.

In the second article, Frederick T. Davis (Columbia Law School) and Charlotte Gunka (Lawyer at the New York bar) discusse the possibilities offered by the American CLOUD Act in terms of criminal and digital sovereignty, under a European and global perspective (Perquisitionner les nuages – CLOUD Act, souveraineté européenne et accès à la preuve dans l’espace pénal numérique).

At a time when the Covid-19 crisis has raised awareness over the urgent need for European Member States to enhance their national sovereignty through the European Union, it is essential to go back to the possibilities offered by the U.S. CLOUD Act with regard to criminal and digital sovereignty. The CLOUD Act proposes a reform of current mutual legal assistance mechanisms by establishing access to digital evidence as the benchmark authorizing computer searches outside state borders, regardless of the location of the relevant data. Although this benchmark allows for more extensive extraterritorial application of U.S. criminal proceedings, an analysis of European regulations and legislation currently in force in France and the United Kingdom confirms that the European approach is not so different from the one introduced by the U.S. government. The emergence of the computer world and the acceleration of new technologies have created a “criminal digital space”, ephemeral and borderless, which requires a fundamental transformation of criminal procedures allowing for faster and more efficient international cooperation against transnational crime. This should give an opportunity to Europe, in particular through its new European Public Prosecutor’s Office, to assert its digital sovereignty through the individual fundamental rights that it continues to promote without undermining the security and strategic interests of its Member States.

In the third article, Vincent Richard (MPI Luxembourg) also deals with (digital) evidence in international dispute resolution, but within the European cooperation in civil matters. The author analyses the recast of the “Taking of Evidence” Regulation (La refonte du règlement sur l’obtention des preuves en matière civile).

Regulation (EU) n°2020/1783 adopted on 25 november 2020 recasts Regulation (EC) n° 1206/2001 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters. Requests for the taking of evidence between Member States shall be transmitted through a decentralised IT system such as e-CODEX. The recast also aims at enhancing the attractiveness of the Regulation by broadening the concept of court and by encouraging direct taking of evidence by the requesting court.

In the fourth article, Thibaut Fleury Graff (University of Rennes) addresses the topical issue of international migration under a legal perspective (Droit des étrangers et des migrations : entre protection de l’ordre public et définitions de la liberté).

 The full table of contents is available here.

Laura Carpaneto, Stefano Dominelli and Chiara Enrica Tuo (all University of Genova) have edited Brussels I bis Regulation and Special Rules – Opportunities to Enhance Judicial Cooperation. The book, which has just been published by Aracne, may be accessed for free here in its entirety.

Contributors include, in addition to the editors themselves, Jean-Sylvestre Bergé, Pierangelo Celle, Silvana Çinari, Chirouette Elmasry, Rosario Espinosa Calabuig, Paula-Carmel Ettori, Giulio Cesare Giorgini, Aida Gugi Bushati, Flutura Kola Tafaj, Rosa Lapiedra Alcami, Guillermo Palao Moreno, Francesco Pesce, Ilaria Queirolo, Isabel Reig Fabado and Jessica Sanchez.

The blurb reads as follows.

The volume collects the results of the EU co-funded Project Enhancing Enforcement under Brussels Ia – EN2BRIa, European Union Justice Programme 2014-2020, JUST-JCOO-AG-2018 JUST 831598. It critically and thoroughly addresses art. 67 Brussels I bis Regulation, which determines the relationships between the Regulation and other EU law instruments governing jurisdiction or the free movement of decisions. Also tackling “indirect” relevant relationships between international civil procedure and material law, the Volume rationalizes the main criticalities examined, and offers Principles, Recommendations and Guidelines to increase capacity of practitioners to address such issues, to improve awareness of stakeholders, and to support uniform application of EU law.

For further information see here.

Andrea Bonomi and Patrick Wautelet have authored an article-by-article commentary, in French, of Regulations 2016/1103 and 2016/1104 on the property regimes of international couples, with the assistance of Ilaria Pretelli, Eva Lein, Guillaume Kessler, Sara Migliorini and Konstantinos Rokas.

The book has just been published by Larcier under the title Le droit européen des relations patrimoniales de couple – Commentaire des Règlements (UE) 2016/1103 et 2016/1104.

The authors have kindly provided the following presentation in English.

Professionals in the area of family law and estate planning are increasingly confronted with cross-border couples and families whose assets may be scattered in different countries. The determination of the law governing the family assets has often become an indispensable step in order to advise spouses or partners about the financial implications of their union, the consequences of a change of residence, or to share out their property in the case of divorce or death. In all these scenarios, it is often necessary to assess the validity and effects of a property agreement entered into in a foreign jurisdiction. And in the case of disputes, the determination of the competent court and of the cross-border effects of a court decision will be crucial. All these questions are made more complex by the fact that most relationships extend over several years, if not decades, by the possible involvement of third parties, and by the connection with other areas of the law.

The European regulations on matrimonial property and on the property consequences of registered partnerships intend to provide answers to some of these problems and to ensure more legal certainty. However, the interpretation of these complex instruments also raises a great number of new and intriguing questions.

This new commentary provides for a very detailed and fine-tuned analysis of the two regulations. The textual and systematic interpretation rests on a solid comparative law background and is enriched by numerous practical examples. Drafted by an international team of experts, it offers a genuinely European reading of the new instruments, taking into account their multiple connections with the other EU regulations in the area of civil justice, notably the Succession Regulation and the Brussels II-terRegulation, as well as the guidance provided by the Court of Justice of the European Union.

This book intends to serve as reference for researchers dealing with two major regulations adopted by the EU. It also aims to stir up the conversation among researchers and policy makers interested in private international law and the economic aspects of family law by pointing to the advantages of the European instruments, while not ignoring the shortcomings and imperfections of two regulations which will guide cross-border activity in family law in the years to come.

For more information, see here.

Which conflict-of-laws rule is the most appropriate for the blockchain? This fundamental question is part of two parallel targeted consultation papers issued as recently by the European Commission.

One of the consultations covers the Settlement Finality Directive (SFD), while the other concerns the Financial Collateral Directive (FCD). Both regulate the “plumbing” of financial markets (the so-called market infrastructures) and contain conflict-of-laws provisions (see Article 9(2) SFD and Article 9 FCD). Yet, the infrastructures and transactions they target are conventional ones. The Settlement Finality Directive deals with payment and securities settlement systems, in which traditional cash (e.g. euros) and conventional financial instruments (e.g. shares and bonds) are traded. The Financial Collateral Directive concerns collateral provided in either cash or financial instruments.

The question posed by the European Commission is whether these texts also can (and must) be applied to modern digital assets, like cryptocurrencies (e.g. Bitcoin) and tokens, and whether they need to be adapted to them through reform.  Since both directives also contain conflict-of-laws provisions, the relationship of crypto-assets to these regulations raises typical conflict-of-laws questions as well.

Take for example Article 9(2) SFD. Its text speaks about securities “legally recorded on a register, account or centralised deposit system” and submits them to the law of the Member State where this register, account or system is “located”. This raises the following issues: 1. whether a blockchain network is a “register” in this sense; 2. whether crypto assets can be said to be “legally” recorded, despite the lacking legal protections of such assets under most private laws; and 3. where blockchains, which may be distributed potentially on a planetary scale, are located.

Even more doubts are caused by Article 9 FCD. It submits financial collateral arrangements to the law of the country “in which the relevant account is maintained”. Blockchain networks basically operate without any intermediaries and do not feature “accounts” in the proper sense of the word. Even if they would, it would be hard to say where the account is “maintained” given the distributed nature of a blockchain network.

These issues have a certain sense of urgency due to the fact that some EU and EEA Member States have already pressed ahead and created specific rules for crypto assets.

France for instance allows for securities (such as bonds and shares) traded over the counter (OTC) to be issued on blockchain networks (described as “distributed electronic registers” (dispositif d’enregistrement électronique partagé – DEEP)). The condition is that the securities are issued in the French territory and governed by French law, see Art. L211-3 French Code monétaire et financier. The transfer and pledge of such crypto financial instruments is equally governed by French law.

Germany has drafted a bill to allow the issuance of bonds (including covered bonds) and investment participations on the blockchain. Section 32 of the bill provides for the applicability of the law of the country in which the administrator of the register is supervised.

Liechtenstein, an EEA member and as such also bound by the SFD and the FCD, has adopted an Act on Token and TT (Trustworthy Technology) Services Providers, which, by any standard, is one of the most comprehensive and innovative blockchain regulations in the world. The Act is appliable where: 1. the TT provider is headquartered or residing in the Principality; or 2. where the parties expressly chose its provisions, see its Art. 3(2).

These are three different approaches to the conflict-of-laws issues raised with regard to different types of crypto assets. But are those national laws compatible with the SFD and the FCD? Do the SFD and FCD apply at all to crypto assets? If so, are their provisions, including those on the conflict of laws, compatible with the nature of the blockchain? And if they do not apply, should they be extended to them? Some legal consistency and harmony would surely be welcome. The question is if and when the EU legislator will provide it.

On 24 March 2021 the Court of Justice issued a judgement in the case of SS v MCP, C-603/20 PPU, which concerns interpretation of the jurisdictional rules of Brussels II bis Regulation. The request for a preliminary ruling originated from the High Court of Justice (England & Wales), Family Division.

The Court decided that a court of a Member State seized of an action relating to parental responsibility cannot base its jurisdiction on Article 10 of the Brussels II bis Regulation in a case of abduction of a child to a third State.

Interestingly, the opinion (commented here by Geert Van Calster from the perspective of the principle of mutual trust) suggested the opposite conclusion, in spite of the fact that both the CJEU and the advocate general relied on the wording of the relevant provisions, their context and objectives, legislative history and relation with international instruments.

Factual Background

SS and MCP are two Indian citizens residing in the UK, where their child P was born in 2017. The couple is not legally married. SS is indicated as the father on the birth certificate, and consequently he has parental responsibility. In October 2018, the mother went to India with the child, where the child stayed with her grandmother. In August 2020 P submitted an application to the referring court, seeking an order for the return of the child to the UK and a ruling on rights of access.

The mother has challenged the jurisdiction of the court, since the child is not habitually resident in the UK. In the opinion of the referring court, the conduct of the mother probably amounts to the child’s wrongful removal (retention) in India. India is not a contracting party to the 1980 Hague Child Abduction Convention.

Preliminary Question

The referring court considers that it is necessary to determine whether it has jurisdiction on the basis of Brussels II bis (for its application in the UK for proceedings initiated before the end of transition period see: Note to Stakeholers on Brexit and PIL). Because the child does not have habitual residence in the UK and there is no consent of both parents as to jurisdiction of UK courts, the court has doubts whether it might base its jurisdiction on Article 10 Brussels II bis.

In accordance with this provision in case of a wrongful removal (retention), the courts of the Member State where the child was habitually resident immediately before the wrongful removal (retention) retain their jurisdiction until the child has acquired habitual residence in another Member State and one of alternative additional requirements is met. As the child was wrongfully retained in a third State, the referring court wonders whether Article 10 provides that UK courts retain their jurisdiction … indefinitely.

The Judgement

The CJEU answered strongly in the negative and underlined that:

(…) there is no justification for an interpretation of Article 10 [Brussels II bis] that would result in indefinite retention of jurisdiction in the Member State of origin in a case of child abduction to a third State, neither in the wording of that article, nor in its context, nor in the travaux préparatoires, nor in the objectives of that regulation. Such an interpretation would also deprive of effect the provisions of the 1996 Hague Convention in a case of child abduction to a third State which is a contracting party to that convention and would be contrary to the logic of the 1980 Hague Convention (paragraph 62).

As a result, the jurisdiction of the referring court might be determined in accordance with the applicable international conventions or, in the absence of any such international convention, in accordance with Article 14 Brussels II bis (which requires the presence of the child within the forum).

The Reasoning of the Court

First, the wording of Article 10 Brussels II bis clearly indicates that it applies to intra-EU abductions only (points 38-41), as it talks about “a Member State” and “another Member State”.

Second, as regards the context of Article 10 Brussels II bis, CJEU pointed that it constitutes a special ground of jurisdiction with respect to the general one in matters of parental responsibility laid down in Article 8(1), which provides for the jurisdiction of the Member State, where the child is habitually resident (paragraph 43). This ground of jurisdiction “defeats what would otherwise be the effect of the application of the general ground of jurisdiction (…), in a case of child abduction, namely the transfer of jurisdiction to the Member State where the child may have acquired a new habitual residence, following his or her abduction. Since that transfer of jurisdiction might secure a procedural advantage for the perpetrator of the wrongful act, Article 10 of that regulation provides (…) that the courts of the Member State where the child was habitually resident before the wrongful removal or retention are, nonetheless, to retain their jurisdiction unless certain conditions are met” (paragraph 45).

As a result, if the child has acquired new habitual residence outside the EU, after being wrongfully removed (retained) in a third State, there is no room for the application of the general rule. Hence,  in such case also the rule laid down in Article 10 “loses its raison d’être, and there is not, therefore, any reason to apply it” (paragraph 46). Additionally, as it is a special ground of jurisdiction, it must be interpreted restrictively (paragraph 47).

By the way, it is striking to see absolutely different conclusions drawn from this juxtaposition of Articles 8 and 10 Brussels II bis in the opinion:

Where a child was habitually resident in a Member State, as is the case with the child here, the courts of that Member State are to retain their jurisdiction until that child acquires his or her habitual residence in ‘another Member State’. Since reference is made only to another Member State, it can be inferred from this, in my view, that, where a child is wrongfully removed to, or retained in, a non-Member State, the courts of the Member State in which that child was habitually resident continue to have jurisdiction (paragraph 53 of the opinion)

Third, the CJEU refers to the legislative history of Brussels II bis and reminds that the EU legislature wanted to establish strict rules with respect to child abductions within the EU, whereas abductions to third states are supposed to be covered by international conventions, such as the 1980 Hague Child Abduction Convention and 1996 Hague Parental Responsibility Convention. It might be noted that 1980 Hague Convention is not referred to in the opinion.

The CJEU points out also that the interpretation of Article 10 Brussels II bis as proposed by the referring court “would have the consequence that, where the child has acquired a habitual residence in a third State which is a contracting party to the 1996 Hague Convention, following an abduction, Article 7(1) and Article 52(3) of that convention would be deprived of any effect” (paragraph 53). It should be noted that Article 7(1) 1996 Hague Convention makes provision (like Article 10 Brussel II bis) “for a transfer of jurisdiction to the courts of the State where the child has acquired a new habitual residence, if certain conditions are satisfied. Those conditions are connected, in particular, to the passage of time together with acquiescence or inaction on the part of the person concerned who holds a right of custody, the child having become settled in his or her new environment” (paragraph 54). This possibility would be precluded if Brussels II bis would allow the courts of a Member State to retain indefinitely their jurisdiction (paragraph 55).

Such retention of jurisdiction, in view of the CJEU, would also be “contrary to Article 52(3) of the 1996 Hague Convention, which prohibits rules agreed between one or more contracting States (…) from affecting, in the relationships of those States with the other contracting States, the application of the provisions of that convention. To the extent that jurisdiction in matters of parental responsibility could not be transferred to those courts of contracting States, those relations would necessarily be affected” (paragraph 55).

Additionally, indefinite retention of jurisdiction would be incompatible with one of the fundamental objectives pursued by the regulation, namely the best interests of the child, which gives priority to the criterion of proximity (paragraph 58). This objective requires setting balance between “the need to prevent the perpetrator of the abduction from reaping the benefit of his or her wrongful act” and “the value of allowing the court that is closest to the child to hear actions relating to parental responsibility” (paragraph 59). Interestingly, in the opinion, while referring to the best interest of the child, the objective of “deterring child abductions” seems to be given priority (paragraph 70 of the opinion).

Finally, indefinite retention of jurisdiction, according to the CJEU, would also disregard the logic of the mechanisms established by the 1980 Hague Convention.

If, in accordance with Article 16 of that convention, it is established that the conditions laid down by that convention for return of the child are not satisfied, or if an application under that convention has not been made within a reasonable time, the authorities of the State to which the child has been removed (…) become the authorities of the State of habitual residence of the child, and should, as the courts that are geographically closest to that place of habitual residence, have the power to exercise their jurisdiction in matters of parental responsibility. That convention remains applicable, in particular, in relations between the Member States and the other contracting parties (paragraph 61).

I am not especially keen on celebrating anniversaries. However, as things stand now in the European Union I thought it worth a short post on the seminal decision of the Court of Justice in case 22/70, AETR (EU:C:1971:32), of 31 March 1971. My attention has been drawn to its fiftieth anniversary.

Let’s celebrate what it meant legally (no political stance here), in terms of strengthening the competences of the (nowadays) Union and, as a consequence, for the uniformity of the legal systems of the Member States.

Background

The case is named after the European Agreement concerning the work of crews of vehicles engaged in international road transport (AETR), done at Geneva on 19 January 1962. The agreement had been signed by five of the six Member States of the EEC and other European States, but could not enter into force, absent the necessary ratifications. Negotiations for the revision of the agreement were resumed in 1967. Similar work undertaken at Community level with regard to standardizing driving and rest periods of drivers of road transport vehicles resulted in Regulation No 543/69 of the Council of 25 March 1969 on the harmonization of certain social legislation relating to road transport. In the course of its meeting on 20 March 1970 the Council, in view of the meeting of the sub-committee on Road Transport of the Economic Commission for Europe of  April 1970 at Geneva, discussed the attitude to be taken by the six Member States of the EEC in the negotiations for the conclusion of a new AETR.

The Member States conducted and concluded the negotiations in accordance with the proceedings of 20 March 1970. The AETR was made available by the secretariat of the Economic Commission for Europe from 1 July 1970 for signature by the Member States. On 19 May 1970 the Commission of the European Communities lodged an application for the annulment of the proceedings of the Council of 20 March 1970 regarding the negotiation and conclusion of the AETR by the Member States of the EEC.

In essence, the Commission disputed the validity of said proceedings on the ground that they involved infringements of the Treaty, more particularly of Articles 75, 228 and 235 concerning the distribution of powers between the Council and the Commission, and consequently the rights which it was the Commission’s duty to exercise in the negotiations on the AETR.

Ruling

The Court ruled actually against the application. This notwithstanding, it also made substantial assertions on the extent of the external competence of the Community:

The Community enjoys the capacity to establish contractual links with third countries over the whole field of objectives defined by the Treaty. This authority arises not only from an express conferment by the Treaty, but may equally flow from other provisions of the Treaty and from measures adopted, within the framework of those provisions, by the Community institutions. In particular, each time the Community, with a view to implementing a common policy envisaged by the Treaty, adopts provisions laying down common rules, whatever form they may take, the Member States no longer have the right, acting individually or even collectively, to undertake obligations with third countries which affect those rules or alter their scope. With regard to the implementation of the provisions of the Treaty, the system of internal Community measures may not be separated from that of external relations.

Consequences in the Domain of PIL

The consequences of the AERT decision on PIL conventions have been profusely analyzed by scholars (see, for instance, The External Dimension of EU Private International Law after Opinion 1/13, edited by P. Franzina). Two Opinions have been rendered directly focusing on the field. In the first one, Opinion 1/03 (EU:C:2006:81), delivered on February 7, 2006, the Court was requested by the Council to answer whether the conclusion of the new Lugano Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters falls entirely within the sphere of exclusive competence of the Community, or within the sphere of shared competence of the Community and the Member States. The second Opinion is Opinion 1/13 (EU:C:2014:2303), of 14 October 2014; the European Commission asked the Court whether the exclusive competence of the European Union encompasses the acceptance of the accession of a non-Union country to the Convention on the civil aspects of international child abduction concluded in the Hague on 25 October 1980.

In both cases the Court’s ruling supports the exclusive competence of the Union. This should be enough to proceed without a further Opinion in regard to the HCCH 2019 Judgments Convention, or, for that matter, to the accession of the UK to the 2007 Lugano Convention. A trickier question may be, though, whether the Member States are free to update bilateral conventions preexisting the Brussels regime, just as Norway has done (see, implicitly in favor of negative answer, Alex Layton here. I concur).

In September 2020, the First President of the French supreme court for private and criminal matters (Cour de Cassation), Ms Chantal Arens, presented the main aspects of the Court’s international strategy for 2020-2022.

The report of this presentation (available here, in French) may be of interest to practitioners and academics dealing with private international law (PIL) issues connected to France.

Here are the key elements of the report and some personal comments.

This “international action plan” of the Cour de Cassation is the result of discussion within the Court and exchanges with institutional partners worldwide. It is based on three main objectives: international reputation, promotion of fundamental values and judicial cooperation.

International Reputation

The first objective is for the Cour de Cassation to gain an international recognition of its qualities as a judicial institution, in particular regarding its working methods (see here) and caselaw. This ambition is also part of a broader goal of promoting the civil law tradition and the French-speaking community worldwide.

Against this backdrop, the website of the Court will be accessible in foreign languages and its landmark judgements will be translated into various languages and accessible online (see, for now, the very few documents available in English). It will be a great advantage for non-French-speaking PIL experts to be able to access the French “living law” in civil and commercial matters. In this respect, the international commercial chamber at the Paris Court of Appeal (ICCP-CA) established in 2018 may surely be seen as a pioneer within the French legal landscape, since its judgements are translated into English (see here).

Fundamental Values

The second objective is the promotion of the fundamental values and principles of the French judicial system (i.e. independence of justice, legal certainty, “dialogue” between judges, fundamental freedoms). However, these are not specific to France since they are inherent to the European legal order, within the Council of Europe and the European Union.

Regarding transnational judicial dialogue, it can be noticed that the Cour de Cassation is more and more likely to refer to European case law in its own decisions (for a recent example reported on this blog, see here). It may also be noted that the Court submitted to the ECtHR, in October 2018, the first request under Protocol No. 16 in the field of international family law. A PIL issue was at stake, namely the compliance with article 8 of the ECHR of the non-recognition of a foreign birth certificate of a child born abroad as the result of a surrogacy – prohibited in France – (for the request see here and for the advisory opinion see here).

Within the EU legal order, however, one could expect the Cour de Cassation to reinforce its involvement by referring to the CJEU requests of interpretation of EU law (and EU PIL in particular). With respect to judicial Cooperation in civil matters, only two cases submitted by the French Court are currently pending before the Court of justice (and three altogether for France in this field; two were reported here and here), whereas, at the same time, around fifteen preliminary questions from German Courts are pending (following a quick research via the curia case-law search form). A recent judgment of the Cour de Cassation on the scopes of Brussels II bis Regulation and 1996 Hague Convention (reported here) may be seen as an illustration of the reluctance of the French Supreme Court to submit preliminary questions to the CJEU, despite the existence of serious doubts on the interpretation of EU (PIL) law (and its duty to do so pursuant to article 267, §3, TFEU).

International Judicial Cooperation

The third objective is to learn from other legal systems in order to enrich French law. It implies, in particular, the development of transnational exchanges on common legal issues. In this context, international judicial cooperation is crucial.

The Cour de Cassation is a member of various European and international networks such as the Association of the French-speaking Supreme Courts (AHJUCAF) and the network of The Presidents of the Supreme Judicial Courts of the Member States of the European Union.

The latter network serves as a forum for exchanges between the European institutions and the national Supreme Courts.

A common portal of case law is also accessible to facilitate the search (and the translation) of national case law within the legal orders of the EU Member States. It should not be confused with the Judicial Network of the European Union (Réseau judiciaire de l’Union européenne, “RJUE”) created more recently on the initiative of the President of the CJUE and the Presidents of the Constitutional and Supreme Courts of the Member States in 2017.

It also provides for a collection of decisions delivered by national courts and tribunals, which are of particular interest for EU law. The creation of such online compendiums of transnational case law is surely of great interest for PIL experts and more efforts (and funds) should be put in their developments (see, by comparison, the unalex and the Lynxlex databases).

 

*Thanks to my colleague Lukas Rass-Masson (University of Toulouse), a recorded conference on the international strategy of the French Court of Cassation, with Ms First President Chantal Arens, is available here.

Ilaria Pretelli (Swiss Institute of Comparative Law, University of Urbino) has posted Protecting Digital Platform Users by Means of Private International Law on SSRN.

The present article offers perspectives on the possible adaptation of traditional connecting factors to the digital space. It analyses cases that pit platform users against each other and cases that pit platform users against the digital platform itself. For the first set of cases, reliable guidance is offered by the principle of effectiveness. The enforcement of court decisions in cyberspace is often necessary and also plainly sufficient to render justice. Enhanced protection of weaker parties is advocated, both in tortious (favor laesi) and contractual liability (protection of the weaker party), in line with the most recent achievements in human rights due diligence. Protection clauses leading to destination-based labour standards would be a welcome step forward. Protection of users also offers guidance for the shaping of private international law rules governing disputes between users and the platform.

The paper is forthcoming in Cuadernos de Derecho Transnacional.

It is well-known that the Succession Regulation contains specific rules relating to succession agreements in its Article 25. Inter alia, it allows the parties to select the law applicable to such agreements, offering the choice between the law of the parties’ last habitual residence or nationality (Article 25(3)). But when can such a choice be assumed, and under which rules? This is the subject of a recent decision by the German Federal Supreme Court.

Facts

An Austrian and a German national were married and lived together in Germany. In 1996, they appointed each other in a “Gemeinschaftliches Testament”, literally a “common will”, as sole heirs and determined who should succeed the surviving spouse. The will was made in two separate deeds and was therefore technically an “agreement as to succession” in the sense of Article 3(1)(b) of the Succession Regulation, and not a “joint will”, which the Regulation defines as a will drawn up in one document by two or more persons, see its Article 3(1)(c). The parties excluded any unilateral modification of the agreement during their lifetimes and after the death of one spouse.

This agreement was binding on the surviving spouse under German law, but not under Austrian law due to the lack of the notarial form.

After the death of her husband, the wife wrote a new will. When she died, its validity was challenged in a German court by the heirs designated in the agreement from 1996.

Legal Issue

To solve this case, the German Federal Court had to characterise the agreement under the provisions of the Succession Regulation and to determine whether it was governed by German or Austrian law.

The Succession Regulation was applicable as the second spouse had deceased after its entry into force on 17 August 2015 (Article 83(1)). The Regulation’s rules on dispositions after death, which include agreements as to succession, apply in addition to the law of habitual residence and nationality of the deceased, in line with the principle of favor validatis (Article 83(3) Succession Regulation).

The Federal Court considered whether the parties had chosen German law for their agreement in line with Article 25(3) Succession Regulation. But under which rules should the court determine whether such a choice is made? Is this issue governed by EU law or by the chosen national law?

Holding

The German Federal Court opted for the application of EU rules to determine whether a choice of law exists. The autonomous determination was important because the conditions for a choice under German law were not fulfilled in the case.

The court based the need for an EU autonomous interpretation on several arguments. It cited Article 22(2) of the Succession Regulation and Recitals 39 and 40, which show that the Regulation lays downs requirements for the choice of law. The German Federal Court did not see Article 22(3) Succession Regulation as contrary to this view since this provision would concern the validity of a choice, not the existence of a choice itself.

In the opinion of the German judges, Article 22 Succession Regulation permits an implicit choice of law. The Court in this regard distinguished Article 3(1) Rome I Regulation, which does not allow such implicit choice. The Federal Court explained this divergence by reference to the fact that, in case of contractual obligations, the parties typically have opposing interests, which calls for an unambiguous determination of the applicable law. The situation in succession would be different as there are no conflicting interests to be taken into account, only the will of the de cujus.

The Federal Court furthermore considered it unnecessary to submit these questions to the CJEU, as the answers would result with sufficient clarity from the text of the Succession Regulation and the previous case law of the European court (“acte claire” doctrine).

Result

The German Federal Court concluded that from an autonomous European point of view the spouses had implicitly chosen German law to govern their succession agreement. It deduced this from the use of legal terms typical for German law, such as “Schlusserbe” (final heir), which cannot be found in Austrian legislation. Moreover, the Court emphasised the parties’ intention for the agreement to be binding, which was possible only under German but not under Austrian law.

Assessment

The result reached by the German Federal Court has to be applauded. The spouses had drawn up two wills which they wanted to be mutually binding. This intention was best served by assuming the applicability of German law. Yet this result could also have been achieved by an application of Article 25(2) subpara. 2 of the Succession Regulation, as the agreement was most closely connected to Germany, given that both decedents had their habitual residence there and one of them was a German national at the time the deeds were drawn up.

Be that as it may, the clarifications of the Federal Court with regard Article 25(3) of the Regulation are to be welcomed. The judgment draws a distinction between the existence of a choice, which shall be governed by EU law, and its substantive validity, which would be determined by the chosen national law. Admittedly, this is a fine line, yet it is a necessary one. In the case at hand, it was not easy to say which law the parties had chosen in the first place. This question cannot be answered by the hypothetically chosen law.

However, the Federal Court’s distinction between the Succession Regulation and the Rome I Regulation fits unilateral wills only. It is not equally persuasive for agreements as to succession and joint wills, which are much more akin to a contract and where the parties do not necessarily pursue the same interests.

The answers to the questions raised by the case are far from obvious. It is therefore regrettable that the German Federal Court did not submit a reference for a preliminary ruling to the CJEU. This omission demonstrates once again the importance of providing English summaries of national decisions, as is done in this blog.

— Many thanks to Verena Wodniansky-Wildenfeld and Felix Krysa for their contribution to this post.

Due to the uncertainties regarding the corona situation, the Scientific Council of EAPIL has decided to postpone the Aarhus EAPIL Conference to 2-4 June 2022.

Again, Aarhus University has offered to host the conference.

Participants who have previously chosen to transfer their registration/fee to the 2021 conference will be contacted directly by e-mail and offered to transfer their registration to 2022 or be reimbursed.

The program for the conference remains unchanged and many of the speakers have already confirmed their attendance once again.

EAPIL is confident that all the speakers will join the Aarhus Conference in 2022.

Registration for the 2022 EAPIL Aarhus Conference will be announced on both the Aarhus Conference and EAPIL website and is expected to open mid-April 2021.

On 26 and 29 March 2021, the European Commission will host a webinar on the use of artificial intelligence technologies in the field of justice.

This will be the first in a series of events, which are a follow-up to the Communication of the Commission itself on the Digitalisation of Justice in the European Union of 2 December 2020 (reported here on this blog).

The topic of the first webinar is the Anonymisation and pseudonymisation of judicial decisions.

The webinar will bring together representatives of the academia, the private sector and the Member States with the aim to further discussions, in particular on publication of judicial decisions practices, including online publication, provision of judicial decisions as open data, approaches towards the protection of personal data, techniques for anonymisation and pseudonymisation of judicial decisions, existing projects and solutions at the national level and solutions available on the market…

Speakers include Eero Hyvönen (Aalto University and University of Helsinki), Monica Palmirani (University of Bologna), Edita Gruodytė (Vytautas Magnus University) and Louis Béziaud (University of Rennes).

The full program is available here. For the web streaming service see here (26 March) and here (29 March).

COVID – or rather, its consequences on legal relationships – has arrived to the CJEU in the form of a request for a preliminary ruling of the Austrian Oberster Gerichtshof. The question submitted in case C-18/21, Uniqa Versicherungen, relates to Regulation No 1896/2006 creating a European order for payment procedure. It reads as follows:  

Are Articles 20 and 26 [of the Regulation] to be interpreted as meaning that those provisions preclude an interruption of the 30-day period for lodging a statement of opposition to a European order for payment, as provided for in Article 16(2) of that Regulation, by Paragraph 1(1) of the Austrian [Federal Law on accompanying measures for COVID-19 in the administration of justice], pursuant to which all procedural periods in proceedings in civil cases for which the event triggering the period occurs after 21 March 2020 or which have not yet expired by that date are to be interrupted until the end of 30 April 2020 and are to begin to run anew from 1 May 2020?

The request was made in the following context.

The District Court for Commercial Matters of Vienna issued a European order for payment on 6 March 2020, which was served on the defendant, who is resident in Germany, on 4 April 2020. The latter lodged a statement of opposition which was posted on 18 May 2020. The court of first instance rejected the opposition as being out of time, on the ground that the objection had not been filed within the 30-day period provided for by Article 16(2) of Regulation No 1896/2006.

The Commercial Court of Vienna, ruling on the appeal on the merits, set that order aside. It held that the period for lodging a statement of opposition under Article 16(2) of the Regulation had been interrupted pursuant to Paragraph 1(1) of the Austrian Federal Law on accompanying measures for COVID-19 in the administration of justice. The applicant’s appeal on a point of law was directed against that decision, and sought to have the order of the court of first instance restored.

Article 20 of the Regulation provides for the review of the European order for payment before the competent court in the Member State of origin in exceptional cases – in the case at hand the relevant para would be 1 (b). According to Article 26, all procedural issues not specifically dealt with in the Regulation are governed by national law.

(And: among the argument of the Austrian OGH to refer its doubts to the Court, the divergent views of scholars on the impact on the Regulation of national procedural measures due to COVID-19 is placed first. Legal literature matters).

Kurt Siehr (formerly MPI Hamburg) has posted Mandatory Rules of Third States: from Ole Lando to Contemporary European Private International Law on SSRN.

The abstract reads:

On 18 October 2016 the European Court of Justice, in the case Greece v. Nikiforidis, decided: ‘Article 9 (3) of the Regulation No. 503/2008 on the law applicable to contractual obligations must be interpreted as precluding overriding mandatory provisions other than those of the State of the forum or of the State where the obligations arising out of the contract have to be or have been performed from being applied, as legal rules, by the court of the forum, but as not precluding it from taking such other overriding mandatory provisions into account as matters of fact in so far as this is provided for by the national law that is applicable to the contract pursuant to the regulation’. Ole Lando already anticipated this development when he dealt with this problem arising under the Rome Convention of 1980 on the law applicable to contractual obligations still in force in Denmark.

The paper was published in the European Review of Private Law 2020.