Agrégateur de flux

I. Introduction

Contingency fee agreements are arrangements whereby lawyers agree with their clients to receive a percentage of the final awarded amount in terms of payment of legal services. Such payment typically depends upon the lawyer winning the case or reaching a settlement. The admissibility of contingency fee agreements varies from one jurisdiction to another, ranging from complete prohibition to acceptance. For example, in the MENA Arab region, jurisdictions such as Bahrain prohibit contingency fee arrangements (see below). However, in other jurisdictions such as Saudi Arabia, contingent fees are not only permitted but also have been described as established practice in the country (cf. Mekkah Court of Appeal, Ruling No. 980/1439 confirming the Ruling of Jeddah Commercial Court No. 676/1439 of 3 Rajab 1439 [20 March 2018] considering that receiving a percentage of the awarded amount that ranges between 15% to 30% as “an established judicial and customary practice among lawyers”).

With respect to the enforcement of foreign judgments, a crucial issue concerns whether a foreign award ordering the payment of contingent fees would be enforced abroad. In a country where contingent fees contracts are prohibited, the presence of such elements in foreign judgments is likely to affect their enforceability due to public policy considerations. The Bahraini Supreme Court (hereafter ‘BSC’) addressed this particular issue in what appears to be an unprecedented decision in the MENA region. The Court held that a foreign judgment ordering payment of contingent fees as agreed by the parties is contrary to public policy because contingency fee agreements are forbidden in Bahrain (Supreme Court, Ruling No. 386/2023 of 20 February 2024).

 

II. Facts

The case concerned an action for the enforcement of a Saudi judgment brought by X (a practicing lawyer in Saudi Arabia) against Y (the appellee, owner of a sole proprietorship, but no further indications as to Y’s nationality, habitual residence or place of business were mentioned in the judgment).

According to the underlying facts as summarized by the Supreme Court, both X and Y agreed that X would represent Y in a case on a fee of 10% of the awarded amount (105,000 USD). As Y failed to pay, X brought an action in Saudi Arabia to obtain a judgment against Y requiring the latter’s sole proprietorship to pay the amount. Later, X sought the enforcement of the Saudi judgment in Bahrain. The first instance court ordered the enforcement of the foreign judgment, but its decision was overturned by the Court of Appeal. There, X filed an appeal to the BSC.

Before the BSC, X argued that the Court of Appeal erred in its decision as it declared the (contingency fee) agreement between the parties null and void on public policy grounds because it violated article 31 of the Bahraini Attorneys Act (qanun al-muhamat), which prohibits such agreements. According to X, the validity of the agreement is irrelevant in casu, as the court’s function was to examine the formal requirements for the enforcement of the Saudi judgment without delving in the merits of the case. Therefore, since the foreign judgment satisfies all the requirements for its enforcement, the refusal by the Court of Appeal to order the enforcement was unjustified.

 

III. The Ruling  

The BSC rejected the appeal by ruling as follows:

“It stems from the text of the provisions of Articles 1, 2 and 7 of the [1995 GCC Convention on the Enforcement of Foreign Judgments] as ratified by Bahrain in [1996], and the established practice of this Court, that judgments of a GCC Member State rendered in civil, commercial, administrative matters as well as personal status matters that become final [in the State of origin] shall be enforced by the courts and competent judicial authorities of the other GCC Member States in accordance with the procedure set forth in [the] Convention if it was rendered by a court having jurisdiction according to the rules of international jurisdiction of the requested State or according to the provision of the present Convention. [In this respect,] the role of the judicial authority of the requested State shall be limited to examination of whether the [foreign] judgment meets the requirement set forth in the Convention without reviewing the merits of the case. [However,] if it appears that the [foreign] judgment is inconsistent with the rules of Islamic Sharia, the Constitution or the public policy of the requested State, the [requested court] shall refuse to enforce the foreign judgment as a whole or in part.

Public policy is a relative (nisbi) concept that [can be interpreted] restrictively or broadly [as it varies with] time, place and the prevailing customs, and it [is closely linked in terms of] existence or not with public interest. It [public policy] encompasses the fundamental principles that safeguard the political system, conventional social agreements, economic rules and the moral values that underpin the structure of the society as an entity and public interest. [In addition,] although public policy is often embodied in legislative texts, however, it transcends these texts to form an overarching and independent concept. [Thus,] when a legislative text contains a mandatory or prohibitive rule related to those fundamental principles and aims at protecting public interest rather than individual interests, [such a rule] should not be disregarded or violated. [This is because, such a rule is] crucial for preserving the [public] interests associated to it and takes precedence over the individual interests with which it conflicts as it falls naturally within the realm of public policy, whose scope, understanding, boundaries and reach are determined in light of those essential factors of society so that public interest is prioritized and given precedence over the interests of certain individuals.

[This being said,] it is established that the judgment whose enforcement is sought in Bahrain ordered Y to pay X 105,000 USD as [contingent fees], which represent 10% of the amount awarded to Y. [It is also established that] the parties’ [contingency fee] agreement, which was upheld and relied upon [by the foreign court] violates article 31 of the Attorneys Act, which prohibits lawyers from charging fees based on a percentage of the awarded amount. This provision is a mandatory one that cannot be derogated from by agreement, and judgments inconsistent with it cannot be enforced. Consequently, the [contingency fee] agreement upon which the [foreign] judgment to be enforced is based is absolutely void, [rendering] the [foreign] judgment deficient of one of the legally prescribed requirements for its enforcement. This shall not be considered a review of the merits of the case but rather a [fundamental] duty of the judge to examine whether the foreign judgment meets all the requirements for its enforcement.

 

IV. Comments

 

1. General remarks

To the best of the author’s knowledge, this is an unprecedented decision not only in Bahrain, but in the MENA region in general. In addition to the crucial issue of public policy (4), the reported case raises a number of interesting questions regarding both the applicable rules for the enforcement of foreign judgments (2) and révision au fond (3). (on the applicable rules in the MENA Arab jurisdictions including Bahrain, see Béligh Elbalti, “Perspectives from the Arab World”, in M. Weller et al. (eds.), The 2019 HCCH Judgments Convention – Cornerstones, Prospects, Outlook (Hart, 2023) 182, 196, 199. On révision au fond, see ibid, 185. On public policy, see ibid, 188-190).

 

2. The Applicable rules

As the reported case shows, the enforcement of the Saudi judgment was examined on the basis of the 1995 GCC Convention, since both Bahrain and Saudi Arabia are Contracting States to it. However, both countries are also parties to a more general convention, the 1983 Riyadh Convention, which was also applicable (on these conventions with a special focus on 1983 Riyadh Convention, see Elbalti, op. cit., 195-198). This raises a serious issue of conflict of conventions. However, this issue has unfortunately been overlooked by the BSC.

The BSC’s position on this issue is ambiguous because it is not clear why the Court preferred the application of the 1995 GCC Convention over the 1983 Riyadh Convention  knowing that the latter was ratified by both countries in 2000, i.e. after having ratified the former in 1996 (see Elbalti, op. cit. 196)! In any case, since the issue deserves a thorough analysis, it will not be addressed here (on the issue of conflict of conventions in the MENA region, see Elbalti, op. cit., 200-201. See also my previous post here in which the issue was briefly addressed with respect to Egypt).

 

3. Révision au fond

In the reported case, X argued that the decision to refuse the enforcement of the Saudi judgment on public policy grounds violated of the principle of prohibition of the review of the merits. The BSC rejected this argument.  The question of how to consider whether a foreign judgment is inconsistent with public policy without violating the principle of prohibition of révision au fond is very well known in literature. In this respect, it is generally admitted that borderline should be that the enforcing court should refrain from reviewing the determination of facts and application of law made by the foreign court “as if it were an appellate tribunal reviewing how the “lower court” decided the case” (Peter Hay, Advance Introduction to Private International Law and Procedure (Edward Elgar, 2018) 121). Therefore, it can be said the BSC rightfully rejected X’s argument since its assessment appears to be limited to the examination of whether the judgment, “as rendered [was] offensive” without “reviewing the way the foreign court arrived at its judgment” (cf. Hay, op. cit., 121).

 

4. Public policy in Bahrain

 

i. Notion & definition. Under both the statutory regime and international conventions, foreign judgments cannot be enforced if they violate “public policy and good morals” in Bahrain. In the case reported here, the BSC provided a lengthy definition of public policy. To the author’s knowledge, this appears to be the first case in which the BSC has provided a definition of public policy in the context of the enforcement of foreign judgments. This does not mean, however, that the BSC has never invoked public policy to refuse the enforcement of foreign judgments (see, e.g., BSC, Appeal No. 611/2009 of 10 January 2011 in which a Syrian judgment terminating a mother’s custody of her two daughters upon their reaching the age of 15, in application of Syrian law, was held to be contrary to Bahraini public policy). Nor does this mean that the BSC has never defined public policy in general (see, e.g., in the context of choice of law, Béligh Elbalti & Hosam Osama Shabaan, “Bahrain – Bahraini Perspectives on the Hague Principles”, in D. Girsberger et al. (eds.), Choice of Law in International Commercial Contracts – Global Perspectives on the Hague Principles (OUP, 2021) 429 and the cases cited therein).

What is remarkable, however, is that the BSC has consistently used for the definition of public policy in the context of private international law the same elements it uses to define public policy in purely domestic cases. This is particularly clear in the definition adopted by the BSC in the case reported here since it described public policy in terms of “ordinary mandatory rules” that the parties are not allowed to derogate from by agreement. It is worth noting in this regard that the BSC’s holding on public policy appears, in fact, to have been strongly inspired by the definition given by the Qatari Supreme Court in a purely domestic case decided in 2015 (Qatari Supreme Court, Appeal No. 348 of November 17, 2015).

Defining public policy in the way the BSC did is problematic, as it is generally admitted that “domestic public policy” should be distinguished from public policy in the meaning of private international law (or as commonly referred to as “international public policy”). It is therefore regrettable that the BSC did not take into account the different contexts in which public policy operates.

 

ii. Public policy and mandatory rules. As mentioned above, the BSC associates public policy with “mandatory rules” in Bahrain, even though it recognizes that public policy could “transcend” these rules “to form an overarching and independent concept”. This understanding of public policy is not in line with the widely accepted doctrinal consensus regarding the correlation between public policy and mandatory rules. This doctrinal consensus is reflected in the Explanatory Report of the HCCH 2019 Judgments Convention, which makes it clear that “it is not sufficient for [a state] opposing recognition or enforcement to point to [its] mandatory rule of the law […] that the foreign judgment fails to uphold. Indeed, this mandatory rule may be considered imperative for domestic cases but not for international situations.” (Explanatory Report, p. 120, para. 263. Emphasis added). The Explanatory Report goes on to state that “[t]he public policy defence […] should be triggered only where such a mandatory rule reflects a fundamental value, the violation of which would be manifest if enforcement of the foreign judgment was permitted” (ibid. emphasis added).

The BSC’s holding suggests that it is sufficient that the foreign judgment does not uphold any Bahraini mandatory rule to justify its non-enforcement, without a sufficient showing of how that the mandatory rule in question “reflects a fundamental value, the violation of which would be manifest if enforcement of the foreign judgment was permitted”. By holding as it did, the BSC unduly broadens the scope of public policy in a way that potentially undermines the enforceability of foreign judgments in Bahrain.

 

iii. Contingency fee arrangements and Bahraini Public Policy.  As noted above (see Introduction), although contingency fee arrangements are prohibited in Bahrain, they are permitted in Saudi Arabia, where they appear to be widely used. From a private international law perspective, the presence of elements in a foreign judgment that are not permitted domestically does not in itself justify refusal of enforcement. In this sense, the non-admissibility of contingent fees in Bahrain should not in itself automatically lead to their being declared against public policy. This is because contingency fee arrangements should not be assessed on the basis of the strict rules applicable in Bahrain, but rather on whether they appear to be manifestly unfair or excessive in a way that violates “fundamental values” in Bahrain. Otherwise, the implications of the BSC’s decision could be overreaching. For example, would Bahraini courts refuse to enforce a foreign judgment if the contingent fees were included as part of the damages awarded by the foreign court? Would it matter if the case has tenuous connection with forum (for example, the case commented here, there are no indication on the connection between Y and Bahrain, see (II) above)? Would the Bahraini courts apply the same solution if they had to consider the validity of the contingent fee agreement under the applicable foreign law? Only subsequent developments would provide answers to these questions.

 

V. Concluding Remarks

The case reported here illustrates the challenges of public policy as a ground for enforcing foreign judgments not only in Bahrain, but also in the MENA Arab region in general. One of the main problems is that, with a few exceptions, courts in the region generally fail to distinguish between domestic public policy and public policy in the context of private international law (see Elbalti, “Perspectives from the Arab World”, op.cit., 189, 205, and the references cited therein). Moreover, courts often fail to establish the basic requirements for triggering public policy other than the inconsistency with the “fundamental values” of the forum, which are often referred to in abstracto. A correct approach, however, requires that courts make it clear that public policy has an exceptional character, that it has a narrower scope compared to domestic public policy, and that mere inconsistency with ordinary mandatory rules is not sufficient to trigger public policy. More importantly, public policy should also be assessed from the point of view of the impact the foreign judgment would have on the domestic legal order by looking at the concrete effects it would have if its recognition and enforcement were allowed. The impact of the foreign judgment, in this case, would largely depend on the intensity of the connection the case has with the forum.

(Posted on behalf of Professor Reid Mortensen) 

We are pleased to let you know about the establishment of the Australasian Association of Private International Law (‘AAPrIL’).

AAPrIL is being established to promote understanding of private international law in Australia, Aotearoa New Zealand, and the nations of the Pacific Islands.  By ‘private international law’ (or ‘conflict of laws’), we mean the body of law that deals with cross-border elements in civil litigation and practice, whether arising internationally or, in the case of Australia, intra-nationally.

To make AAPrIL a reality, we need your help.  If you have an interest in Australasian private international law, please join us by attending the first general meeting of members of AAPrIL, which will be held online on Thursday 11 July 2024.  The meeting is necessary to establish AAPrIL, approve a Constitution, and elect AAPrIL’s first officers.

The beginnings of our Association

The proposal to establish AAPrIL comes from an organising group* of Australian and New Zealand scholars and practitioners who have been working together in private international law for a long period.

We believe that there is a need for a permanent regional organisation to provide support for regular events and conferences on private international law, and to help coordinate, manage and publicise them.  Our vision for AAPrIL is that it will:

• Regularly distribute a newsletter on recent decisions, legislative developments and publications, and on hot topics and upcoming events on private international law in Australasia.
• Organise proposals and submissions for law reform in private international law.
• Promote the study of private international law in universities.
• Provide a forum for the exchange of information and opinions, debate and scholarship on private international law in Australasia.
• Connect with other private international law associations worldwide.

The proposed Association already has a website and a LinkedIn page.

To our delight, the Honourable Dr Andrew Bell, Chief Justice of New South Wales, has agreed to serve as patron of the Association.  His Honour is well-known as co-author of Nygh’s Conflict of Laws in Australia, and the author of many other publications on private international law.  Before being appointed to judicial office, he had a significant Australia-wide practice in cross-border litigation and international arbitration.

How do you join?

You can join the Australasian Association of Private International Law by signing up on the Membership page of AAPrIL’s website.

There is initially no membership fee to join.  At the meeting to establish AAPrIL, there will be a proposal to set membership fees for 2024-2025 at:

Individual members: AUD 100

Corporate members: AUD 300

Student members: AUD 20

However, membership fees for 2024-2025 will not be requested until after the first general meeting.

What will happen at the general meeting on Thursday 11 July?

Those who join as members by 18 June 2024 will be sent a notice of meeting for the general meeting on 11 July 2024. The agenda will include proposed resolutions:

• To establish the Australasian Association of Private International Law.
• To adopt the Constitution of the Association. If members have any questions about the proposed Constitution before the meeting, could you please direct them to me: mortensen@unisq.edu.au.†
• To appoint the President, Treasurer and Secretary of the Association, and potentially an Australian Vice-President, a New Zealand Vice-President and Pacific Islands Vice-President. If any member wishes to propose another member for one of these offices, please email your nomination to me:  mortensen@unisq.edu.au.†
• To set membership fees for the financial year 2024-2025.

The organising group will also present plans for the activities of the Association.

We are looking forward to this exciting development for those of us who are rightly fascinated by private international law.  We hope you will join us!

Best wishes

Professor Reid Mortensen

On behalf of the AAPrIL interim executive

*******

* The organising group comprises Dr Michael Douglas (Bennett, Perth), Professor Richard Garnett (University of Melbourne), Associate Professor Maria Hook (University of Otago), Professor Mary Keyes (Griffith University), Professor Reid Mortensen (University of Southern Queensland), Ms Cara North (Corrs Chambers Westgarth, Melbourne) and Mr Jack Wass (Stout Street Chambers, Wellington).

† I will be on leave from 3-14 June 2024, but will answer any enquiries that are made in that period as soon as possible afterwards.

The latest issue (1/2024) of The European Legal Forum features a series of comments on the Proposal for a Council Regulation on Parenthood by Ilaria Queirolo on The Proposed EU Regulation on Parenthood: A critical Overview of the Rules on Jurisdiction; Francesco Pesce on, The Law Applicable to Parenthood in the European Commission’s Regulation Proposal; Stefano Dominelli on Recognition of Decisions and Acceptance of Authentic Instruments in Matters of Parenthood under the Commission’s 2022 Proposal; Francesca Maoli on The European Certificate of Parenthood in the European Commission’s Regulation Proposal: on the ‘Legacy’ of the European Certificate of Succession and Open Issues, and Laura Carpaneto on The Hague Conference of Private International Law’s “parentage/surrogacy” project.

The commentary is a deliverable of the Project Fluidity in family structures. International and EU law challenges on parentage matters, financed by the Ministry of University and Research of the Italian Republic and by the European Union – Next Generation EU (prot. n. 2022FR5NNJ – PRIN 2022). The Consortium includes: the University of Pavia as coordinator and the universities of Milano, Genova, and Cagliari.

All publications of the project are available in Open Access here.

Paul Herrup and Ronald A. Brand (University of Pittsburgh – School of Law) have made available on SSRN a paper on the developments in the Hague Conference project on concurrent proceedings, titled A Further Look at a Hague Convention on Concurrent Proceedings. The abstract reads as follows: The current project of the Hague Conference on […]

Comment articuler le droit à bénéficier d’un procès équitable et la liberté d’expression ? Cette interrogation n’est pas simplement théorique et se pose au contraire de manière prégnante compte tenu de la multiplication des procédures initiées contre les usagers de la liberté d’expression et menées par des individus ou groupes puissants, disposant de moyens financiers illimités et/ou d’une force d’influence, quand elles ne s’inscrivent pas dans une politique de « soft power » menée par des États répressifs. Cette pratique dite « des poursuites-bâillons », qui n’est pas nouvelle mais connaît une véritable explosion, au point d’être dénoncée unanimement, a conduit l’Union européenne à adopter une directive pour lutter contre ce phénomène. Mais le texte adopté répond-il à cet enjeu démocratique ?

Sur la boutique Dalloz Code de la communication 2023, commenté Voir la boutique Dalloz

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Three Opinions of Vlas AG at the Dutch Supreme Court dated 5 April 2024 but published today discuss issues of applicable law in competition follow-on cases. See also my earlier posts on Air Cargo and Palink. CJEU authority cited includes Concurrence, Nintendo, Tibor Trans, CDC, flyLAL.

ECLI:NL:PHR:2024:561 is the Palink case in the Truck Cartel: Uzdaroji Akcine Bendrove “Palink” et al v CNH Industrial NV et al

ECLI:NL:PHR:2024:370 concerns the Air Cargo cartel: KLM et al v Stichting Cartel Compensation – SCC; and

ECLI:NL:PHR:2024:369 is also an Air Cargo case, ‘Equilib’: KLM et al v Equilib Netherlands B.V.

In the Truck Cartel opinion which is a preliminary reference, the essence of the case is the impact of a single and continuous infringement on the application of A6 Rome II. A first issue is the date of application of Rome II: it applies (A31 juncto A32) to events giving rise to damage which occur (the events, NOT the damage) after 11 January 2009. The cartel at issue ran between 1997 and 2011. (4.6) the application of Dutch residual lex causae rules for the pre 2009 period and of the Rome II rules for the post 2009 period does not serve Rome II’s quest for predictability. The fissure between pre and post Rome II’s application ratione temporis in the case of a continuous tort is not solved by CJEU Homawoo as referenced ia in CJEU Nikiforidis. 

Vlas AG 4.8 cites Mankowski

The second remaining issue is whether the Rome II Regulation applies where a continuous tort was at stake, i.e. where a multiplicity of events giving rise to the damage have occurred, some before and some after 11 January 2009. There is a plethora of conceivable solutions: First, the last causal event matters. One would run into severe trouble in identifying which event is the last. Second, the first causal event matters. Third, the most relevant causal event matters. Fourth, all causal events are treated as equivalent, and it disqualifies for the purposes of applying the Rome II Regulation that one of them occurred before 11 January 2009. Fifth, all causal events are treated as equivalent, and it suffices for the application of the Rome II Regulation that one of them occurred on or after 11 January 2009.

If one is prepared to adopt as a general policy that the Rome II Regulation and its uniform rules should be applied to the widest possible extent, the fifth approach ought to be preferred.

and Fitchen (4.10)

(…) accordingly, for many years to come it may be that the applicable law in cross-border competition law claims brought after 11 January 2009 will still be wholly or partially governed by pre-Rome II methods of determining the applicable law. As such an outcome does not appear to accord with the general policy of increasing legal certainty in the context of cross-border claims, it is worth considering whether, in the circumstance that an infringement of competition law is alleged to be ongoing both before and after the temporal datum point of Rome II, it is wrong to split the ascertainment of the applicable law. Possibly the fact that the damage causing events of the competition law tort continue past the Rome II datum point should cause the alleged tort to be regarded as occurring continuously and to therefore legitimate the application of the Rome II Regulation to determine the applicable law for the entire claim? Though increasing legal certainty and simplifying the choice of law process for cross-border competition law claims, this suggestion has to contend with the principled objection that it would be an unfair departure from the general stance of Rome II of neutrality between claimant and defendant. This objection is possibly less convincing in the specific context of follow-on competition law claims as here the existence of an anti-competitive act is already established: in these cases such neutrality may be argued to perversely favour the wrongdoer. Considerations of principle aside, the most formidable obstacle to any suggestion that competition claims which straddle the temporal datum point should benefit from a single method of applicable law selection is Rome II itself: the text currently lacks any provision supporting retrospective temporal applicability whether immediate or deferred in time.

It is suggested that a case based upon increasing legal certainty can be made for a legislative amendment to address the problem of an absence of transitional provisions concerning the temporal applicability in Rome II for follow-on competition claims either by allowing a deferred form of retrospective temporal applicability after the effluxion of a certain period of time from 11 January 2009, or, by providing follow-on competition claims with a new specific regime which includes private international law measures more appropriate to this specific type of competition claim.

Vlas AG then himself opposes the fissure or ‘split’ (4.11), citing predictability and legal certainty. However unlike Mankowski he does not propose that author’s ‘5th solution’ per above, rather, (4.13) he suggests the residual rules should apply seeing as the continuous event started pre Rome II’s ratione temporis scope. This he argues will serve predictability and unity of lex causae, albeit he concedes that unity will be achieved at the national as opposed to the EU level. The general absence of retroactive effect of EU PRivIL rules is cited, justifiably IMO, in support. (4.14) he argues against referral to the CJEU, not because the issue is acte clair, rather because in his view under the Dutch residual rules, too, claimants may make choice of law for the lex fori, just as they can under A6(3) RII. In other words he does not think there is an interest in requesting the view from the CJEU. The AG then further discusses the exercise by claimants under A6(3) Rome II (and the residual Dutch rules), opining that it need not be the claimant whose interests have been affected in various countries, just as long as markets have been affected in various countries. He also sees no reason (and I agree; the AG uses ia linguistic comparison) that this should be any different where the claims have been acquired by litigation vehicles. In the air cargo cartel SCC and Equilib cases, which are an application for annulment, Rome II does not feature ratione temporis however in accordance with Dutch authority, A6 Rome II is used pro inspiratio. Here the determination of ‘markets affected’ is an issue. With reference to the travaux and a wide variety of scholarship, the AG suggests ‘the law of the state on whose market the victim was affected by the anti-competitive practice’ ought to be the lex causae, leading to Mozaik of course, with then the subsequent discussion of A6(3)b. In both cases, the AG proposes that the judgment appealed be annulled on the issue of validity of assignment.

Others no doubt will have more analysis. These are highly relevant opinions.

Geert.

EU Private International Law, 4th ed. 2024, 4.53 ff.

https://x.com/GAVClaw/status/1793671819590766990

 

 

Issue 2/2024 of ZEuP – Zeitschrift für Europäisches Privatrecht has just been published. It includes contributions on EU private law, comparative law, legal history, uniform law, and private international law. The full table of content can be accessed here.

The following contributions might be of particular interest for the readers of this blog:

• Auf dem Weg zu einer europäischen Abstammungsverordnung? – Licht und Schatten im Vorschlag der Europäischen Kommission
  Editorial by Christine Budzikiewicz on the Commission Proposal for a EU Regulation on Parenthood and the Creation of a European Certificate of Parenthood
• Europäischer Emissionsrechtehandel – Eine Momentaufnahme nach der Reform durch das „Fit for 55“-Paket
  Sebastian Steuer on European emissions trading: Carbon pricing according to the “cap and trade” principle plays a key role in European climate policy. As part of the “Fit for 55” package, the Emissions Trading Directive has, once again, undergone comprehensive revisions and has been substantially toughened in certain respects. This article gives a basic overview of the current state of European emissions trading after the recent changes. It explores the chief components of the Emissions Trading Directive, highlights the economic differences between quantity- and price-based regulation, and discusses the interplay of the EU emissions trading system with international and German climate policy.
• Microplastics Litigation: eine rechtsvergleichende Orientierung
  Stephanie Nitsch on Microplastics Litigation: The present paper provides a comparative law analysis of liability for microplastics pollution with a special focus on product liability as well as liability due to deliberate or negligent breaches of statutory duties or duties of care.
• Bundesgerichtshof, 18 April 2023, II ZR 184/21
  Susanne Zwirlein-Forschner discusses a decision of the German Federal Court of Justice on the law applicable to liability due to economically destructive actions and to the assignment of claims.

Anna Nylund and Antonio Cabral are the editors of Shaping Civil Litigation Using Procedural Agreements, recently published by Eleven. Procedural agreements hold the potential to effectively customise and expedite civil proceedings. However, their impact on access to justice, particularly for weaker litigants, and the potential erosion of the court’s role raise significant concerns. Despite the […]

A Summer School on Cross-border litigation and international arbitration will take place between 15 and 20 July 2024 both on-site at the Ravenna Campus of the University of Bologna and on-line, under the direction of Michele Angelo Lupoi (University of Bologna) and Marco Farina (LUISS, Rome). The course will address cross-border litigation from a wider […]

La période mars-avril 2024 a été marquée par les deux décisions et l’arrêt de grande chambre Carême, Duarte Agostinho et Verein KlimmaSerionnen Schweiz du 9 avril 2024 attendus avec impatience sur le changement climatique. Ils feront l’objet d’une étude groupée même si la décision Carême qui ne concerne que la France et la décision Duarte Agostinho qui la regarde comme trente-deux autres États membres du Conseil de l’Europe mettent à mal la distinction récemment introduite dans cette chronique entre les affaires françaises et les affaires venues d’ailleurs. Il est si rare que la même question touchant plusieurs pays à la fois soit examinée en même temps par la même formation mêmement constituée de la Cour européenne des droits de l’homme que l’on s’entêtera à isoler les affaires françaises des autres.

Sur la boutique Dalloz Droit de l’exécution des peines 2023/2024 Voir la boutique Dalloz

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The author of this post is Martin Gebauer (Eberhard Karl University of Tübingen). Erik Jayme passed away on 1 May 2024, just five weeks before his expected celebration of his ninetieth birthday. He was born on 8 June 1934, in Montréal, in the francophone Canadian province of Québec. His parents were married on Christmas 1930 […]

Written by Eduardo Silva de Freitas (Erasmus University Rotterdam) and Xandra Kramer (Erasmus University Rotterdam/Utrecht University), members of the Vici project Affordable Access to Justice, financed by the Dutch Research Council (NWO), www.euciviljustice.eu.

Introduction

After extensive negotiations, on 24 April 2024, the European Parliament approved the Corporate Sustainability Due Diligence Directive (CSDDD or CS3D) as part of the EU Green Deal. Considering the intensive discussions, multiple changes, and the upcoming elections in view, the fate of the Commission’s proposal has been uncertain. The Directive marks an important step in human rights and environmental protection, aiming to foster sustainable and responsible corporate behaviour throughout global value chains. Some Member States have incorporated similar acts already, and the Directive will expand this to the other Member States, which will also ensure a level playing field for companies operating in the EU. It mandates that companies, along with their associated partners in the supply chain, manufacturing, and distribution, must take steps to avoid, halt, or reduce any negative effects they may have on human rights and the environment.  The Directive will apply to big EU companies (generally those with more than 1,000 employees and a worldwide turnover of more than EUR 450 000 000) but also to companies established under the law of a third country that meet the Directive’s criteria (Article 2 CSDDD).

Among the CSDDD’s key provisions is the rule on civil liability enshrined in Article 29. This rule states that companies shall be held liable for damages caused in breach of the Directive’s provisions. Accompanying such a rule are also some provisions that deal with matters of civil procedure and conflict of laws, though as has been pointed out earlier on this blog by Kilimcioglu, Kruger, and Van Hof, the CSDDD is mostly silent on PIL. When the Commission proposal was adopted in 2022, Michaels and Sommerfeld elaborated earlier on this blog on the consequences of the absence of rules on jurisdiction in the CSDDD and referred to the Recommendation of GEDIP in this regard. The limited attention for PIL aspects in the CSDDD is does not mean that the importance of corporate sustainability and human rights is not on the radar of the European policy maker and legislator. In the context of both the ongoing evaluation of the Rome II Regulation and Brussels I-bis Regulation this has been flagged as a topic of interest.

This blog post briefly discusses the CSDDD rules on conflict of laws and (international) civil procedure, which underscore the growing importance of both in corporate sustainability and human rights agendas.

Conflict of laws and overriding mandatory provisions

The role of PIL in the agenda of business and human rights has increasingly received scholarly attention. Noteworthy works addressing this intersection include recent contributions by Lehmann (2020), as well as volumes 380 (Van Loon, 2016) and 385 (Marrella, 2017) of the Collected Courses of The Hague Academy of International Law. Additionally, pertinent insights can be found in the collaborative effort of Van Loon, Michaels, and Ruiz Abou-Nigm (eds) in their comprehensive publication, The Private Side of Transforming our World (2021). From an older date is a 2014 special issue of Erasmus Law Review, co-edited by Kramer and Carballo Piñeiro on the role of PIL in contemporary society.

While the CSDDD contains only a singular rule on PIL, specifically concerning overriding mandatory provisions, it should be viewed in the broader EU discourse. The relevance of PIL for the interaction between business and human rights extends beyond this single provision, as evidenced by the Commission’s active role in shaping this development. As indicated earlier, this is further indicated by studies on both the Rome II and Brussels I-bis Regulations, both of which delve into the complexities of PIL within the business and human rights debate. Thus, the CSDDD’s rule should not be viewed in isolation, but as part of a larger, dynamic conversation on PIL in the EU.

The mentioned Rome II Evaluation Study (2021) commissioned by the Commission, summarised on this blog here, assessed Rome II’s applicability to matters pertaining to business and human rights in detail. With regards to overriding mandatory provisions, the study outlines several initiatives at national level in the Member States that were discussed or approved to enact a mandatory corporate duty of care regarding human rights and the environment. Likewise, the Brussels I-bis Evaluation Study (2023) also examined how the Brussels I-bis applies to business and human rights disputes. Within the EU, establishing jurisdiction over EU-domiciled companies is straightforward under the Regulation, but it becomes complex for third-country domiciled defendants. Claims against such defendants are not covered by the Regulation, leaving jurisdiction to national laws, resulting in varied rules among Member States. Forum necessitatis and co-defendants rules may help assert jurisdiction, but lack harmonization across Europe. In this context, as explained by Michaels and Sommerfeld, while the CSDDD applies to certain non-EU firms based on their turnover in the EU (Article 2(2)), jurisdictional issues persist for actions against non-EU defendants in EU courts, with jurisdiction typically governed by national provisions. This could result in limited access to justice within the EU if relevant national rules do not establish jurisdiction.

As was mentioned above, the CSDDD is mostly silent on PIL. However, it does include a rule on overriding mandatory provisions enshrined in Article 29(7) and accompanying Recital 90. This rule aims to ensure the application of the (implemented) rules of the CSSDD regardless of the lex causae. Under EU private international law rules, the application of overriding mandatory provisions is also enabled by Article 9 Rome I Regulation and Article 16 Rome II Regulation.

Article 29(7) CSDDD states that ‘Member States shall ensure that the provisions of national law transposing’ Article 29 CSDDD ‘are of overriding mandatory application in cases where the law applicable to claims to that effect is not the national law of a Member State’. A similar provision to that effect can be found in the draft UN Legally Binding Instrument on business and human rights.

This means that the national laws transposing Article 29 CSDDD in their liability systems are applicable irrespective of any other conflict of law provisions in force. This rule also extends to the matters of civil procedure addressed below, as explicitly stated by Recital 90 CSDDD. On this matter, the potential for the CSDDD to become a dominant global regulatory force and overshadow existing and future national regulations, which is only beneficial if effectively prevents and remedies corporate abuses, has been highlighted. However, there is concern that it might mitigate the development of stronger regulatory frameworks in other countries (see FIDH, 2022).

Matters of civil procedure

The rules contained in the CSDDD that pertain to civil procedure are essentially laid down in Article 29(3). These rules on civil procedure naturally apply to both domestic cases and cross-border situations.

Firstly, Article 29(3)(b) CSDDD states that the costs of judicial proceedings seeking to establish the civil liability of companies under the Directive shall not be prohibitively expensive. A report published in 2020 by the EU Agency for Fundamental Rights (FRA) on ‘Business and human rights – access to remedy’ stressed that private individuals face significant financial risks when resorting to courts due to high costs such as lawyer fees, expert opinions, and potential liability for the opposing party’s costs, particularly daunting in cases involving large companies. Suggestions for improvement include making litigation costs proportionate to damages, providing free legal representation through state bodies, and setting thresholds for the losing party’s financial obligations, along with supporting civil society organizations offering financial and legal aid to victims of business-related human rights abuses. Secondly, Article 29(3)(c) CSDDD provides the possibility for claimants to seek definitive and provisional injunctive measures, including summarily, of both a restorative or enforcing nature, to ensure compliance with the Directive. Lastly, Article 29(3)(d) and (e) CSDDD, respectively, outline rules on collective actions and disclosure of evidence, the latter two explained below.

Collective actions

The FRA report mentioned above emphasized that many legal systems in the EU lack effective collective redress mechanisms, leading to limited opportunities for claimants to seek financial compensation for business-related human rights abuses. Existing options often apply only to specific types of cases, such as consumer and environmental protection, with procedural complexities further restricting their scope. Article 29(3)(d) CSDDD ensures that collective action mechanisms are put in place to enforce the rights of claimants injured by infringements of the Directive’s rules. This provision states that ‘Member States shall ensure that […] reasonable conditions are provided for under which any alleged injured party may authorise’ the initiation of such proceedings. In our view, if this provision is interpreted in a similar way as the alike-rule on private enforcement contained in Article 80(1) GDPR (which uses the synonym ‘mandate’), then this collective action mechanism shall operate on an opt-in basis (see Pato & Rodriguez-Pineau, 2021). The wording of both provisions points to a necessity of explicit consent from those wishing to be bound by such actions. Recital 84 CSDDD further underscores this interpretation by stating that this authorisation should be ‘based on the explicit consent of the alleged injured party’. Importantly, this is unrelated to the collective enforcement of other obligations, outside the scope of the CSDDD, that may impinge upon the types of companies listed in Article 3(1)(a) CSDDD, like those stemming from financial law and insurance law (e.g. UCITS Directive, EMD, Solvency II, AIFMD, MiFID II, and PSD2). All the latter are included in Annex I Representative Actions Directive (RAD) and therefore may be collectively enforced on an opt-out basis pursuant to Article 9(2) RAD (see Recital 84 CSDDD).

Furthermore, Article 29(3)(d) CSDDD grants the Member States the power to set conditions under which ‘a trade union, non-governmental human rights or environmental organisation or other non-governmental organisation, and, in accordance with national law, national human rights’ institutions’ may be authorized to bring such collective actions. The Directive exemplifies these conditions by mentioning a minimum period of actual public activity and a non-profit status akin to, respectively, Article 4(3)(a) and (c) RAD, as well as Article 80(1) GDPR.

In our view, the most relevant aspect of the collective action mechanism set by the CSDDD is that it provides for the ability to claim damages. Indeed, Article 29(3)(d) CSDDD allows the entities referred therein to ‘enforce the rights of the alleged injured party’, without making any exceptions as to which rights. This is an important recognition of the potentially pervasive procedural imbalance that can affect claimants’ abilities to pursue damages against multinational corporations in cases of widespread harm (see Kramer & Carballo Piñeiro, 2014; Biard & Kramer, 2018; Buxbaum, Collected Courses of The Hague Academy of International Law 399, 2019).

Disclosure of evidence

Finally, Article 29(3)(e) CSDDD enacts a regime of disclosure of evidence in claims seeking to establish the civil liability of companies under the Directive. This provision, similar to Article 6 IP Enforcement Directive, Article 5 Antitrust Damages Directive, and Article 18 RAD, seeks to remedy the procedural imbalance of evidentiary deficiency, existent when there is economic disparity between the parties and unequal access to factual materials (see Vandenbussche, 2019).

When a claim is filed and the claimant provides a reasoned justification along with reasonably available facts and evidence supporting their claim for damages, courts can order the disclosure of evidence held by the company. This disclosure must adhere to national procedural laws. If such a disclosure is requested in a cross-border setting within the EU, the Taking of Evidence Regulation also applies.

Courts must limit the disclosure of evidence to what is necessary and proportionate to support the potential claim for damages and the preservation of evidence. Factors considered in determining proportionality include the extent to which the claim or defense is supported by available evidence, the scope and cost of disclosure, the legitimate interests of all parties (including third parties), and the need to prevent irrelevant searches for information.

If the evidence contains confidential information, especially regarding third parties, Member States must ensure that national courts have the authority to order its disclosure if relevant to the claim for damages. Effective measures must be in place to protect this confidential information when disclosed.

Outlook

The CSDDD regime on civil procedure described above largely follows the EU’s ‘silo mentality’ (Voet, 2018) of enacting sectoral-based and uncoordinated collective action mechanisms tied to a specific area of substantive law, such as consumer law, non-discrimination law, and environmental law (e.g. UCTD, RED, UCPD, IED, EIAD, etc.). An important difference being, however, that this time the RAD is already in force and being implemented. On this matter, Recital 84 CSDDD states that Article 29(3)(d) CSDDD ‘should not be interpreted as requiring the Member States to extend the provisions of their national law’ implementing the RAD.

However, being the first EU-wide collective action mechanism and prompting historically collective action-sceptic Member States to adapt accordingly, it is conceptually challenging to posit that the RAD would not potentially influence regimes on collective actions beyond consumer law, including the CSDDD. In this context, it would not deviate significantly from current developments if some Member States opted for a straightforward extension of their existing and RAD-adapted collective action regimes to the CSDDD, though that demands caution to the latter’s specificities and is not legally required.

Another aspect worthy of attention is how these collective actions would be funded. Since such actions may seek damages compensation for widespread harm under Article 29 CSDDD, they can become notably complex and, consequently, expensive. At the same time, a large number of injured persons can mean that these collective actions will ask for high sums in damages. These two factors combined make these collective actions an enticing investment opportunity for the commercial third-party litigation funding (TPF) industry. The CSDDD does not make any reservations in this regard, leaving ample room for Member States to regulate, or not, the involvement of commercial TPF. A report published in mid last year by Kramer, Tzankova, Hoevenaars, and Van Doorn by request of the Dutch Ministry of Justice and Security found that nearly all collective actions seeking damages in the Netherlands make use of commercial TPF. This underscores the crucial role commercial TPF plays in financing such actions, significantly impacting access to justice.

Moreover, the complexities surrounding the integration of PIL into specialized legislation such as the CSDDD, the GDPR, and the anti-SLAPPs Directive reflect a tension between the European Parliament and the Commission. This tension revolves around the extent to which PIL should be addressed within specialized frameworks versus traditional EU legislation on PIL. So far, a clear direction in this regard is lacking, which will trigger further discussions and potential shifts in approach within the EU legislative landscape.

The sixth Journéee de droit patrimonial international, organised by the Centre of Comparative, European and International Law of the University of Lausanne, will take place on 12 September 2024. This year’s edition will revolve around two topics: the application of the European Succession Regulation in the case law of the Court of Justice and the […]

The second edition of Pedro De Miguel Asensio‘s Conflict of Laws and the Internet has just been published by Edward Elgar. The blurb reads: In this thoroughly revised second edition, Pedro De Miguel Asensio presents a practical analysis of jurisdiction, choice of law, and recognition and enforcement of judgments in the context of online activities, […]

On 12 September 2024, the Centre de droit comparé, européen et international (CDCEI) and the Centre du droit de l’entreprise (CEDIDAC) at the Université de Lausanne are hosting the 6e Journée de droit patrimonial international. The conference will focus on the EU Succession Regulation (no. 650/2012) and the section on international successions of the Swiss Private International Law Act.

The flyer can be found here.

 

A bit of a late reblog but for archival etc purposes see my post with Elijah Granet on ECtHR Executief van de Moslims van België v Belgium , re unstunned slaughter, freedom of religious expression and animal welfare over at the Oxford Human Rights Blog here in four languages.

The CJEU held succinctly yesterday and without AG Opinion in Case C-222/23 Toplofikatsia Sofi. The Bulgarian rule according to which all Bulgarian nationals have a permanent domicile in Bulgaria even if they move to a different Member State, undermines the effet utile of Brussels Ia despite that Regulation leaving the determination of domicile of natural persons to the Member States: [60]:

in so far as national legislation automatically links [the concept of domicile] to a permanent, mandatory and sometimes fictitious address registered for any national of the Member State concerned, such legislation undermines the effectiveness of Regulation No 1215/2012, since it amounts to replacing the domicile criterion, on which the rules of jurisdiction laid down by that regulation are based, with the criterion of nationality.

Article 21 TFEU (non-discrimination and citisenship) need not be separately addressed in light of the BIa finding.

Orders for payment against a debtor suspected of being domiciled elsewhere in EU yet also domiciled in Bulgaria according to the formal presumption, may of course (and only) be issued by a Bulgarian court on the basis of A7(1) or indeed any other jurisdictional gateway other than A4,  5 and 6 BIa.

Geert.

 

by Achim Czubaiko, Research Fellow („Wissenschaftlicher Mitarbeiter“) and PhD Candidate, supported by the German Scholarship Foundation, Institute for German and International Civil Procedural Law, University of Bonn.

 

Union Jack and European Union flag 2012 © Dave Kellam (CC BY-SA 2.0 Deed)

Today marks a significant step towards the reconstruction of EU-UK Judicial Cooperation. As neither House of Parliament has raised an objection by 17 May 2024,[1] the way seems to be paved for the Government’s ambitious plans to have the HCCH 2019 Judgments Convention[2] implemented and ratified by the end of June 2024.[3] For the first time since the withdrawal of the United Kingdom from the European Union (so-called Brexit) on 31 January 2020, a general multilateral instrument would thus once again be put in place to govern the mutual recognition and enforcement of judgments in civil and commercial matters across the English Channel.

We wish to take this opportunity to look back on the eventful journey that the European Union and the United Kingdom have embarked on in judicial cooperation since Brexit (I.) as well as to venture a look ahead on what may be expected from the prospective collaboration within and perhaps even alongside the HCCH system (II.).

I. From Brexit to The Hague (2016-2024)

When the former Prime Minister and current Foreign Secretary David Cameron set the date for the EU referendum on 23 June 2016, this was widely regarded as just a political move to ensure support for the outcome of his renegotiations of the terms of continued membership in the European Union.[4] However, as the referendum results showed 51.9% of voters were actually in favour of leaving,[5] it became apparent that Downing Street had significantly underestimated the level of voter mobilisation achieved by the Vote Leave campaign. Through the effective adoption of their alluring “take back control” slogan, the Eurosceptics succeeded in framing European integration as undermining Britain’s sovereignty – criticising inter alia a purportedly dominant role of the Court of Justice (CJEU) – while simultaneously conveying a positive sentiment for the United Kingdom’s future as an autonomous country[6] – albeit on the basis of sometimes more than questionable arguments.[7]

http://www.voteleavetakecontrol.org/why_vote_leave.html

Whatever the economic or political advantages of such a repositioning might be (if any at all), it proved to be a severe setback in terms of judicial cooperation. Since most – if not all – of the important developments with respect to civil and commercial matters[8]in this area were achieved within the framework of EU Private International Law (PIL) (e.g. Brussels Ibis, Rome I-II etc.), hopes were high that some of these advantages would be preserved in the subsequent negotiations on the future relationship after Brexit.[9] A period of uncertainty in forum planning for cross-border transactions followed, as it required several rounds of negotiations between EU Chief Negotiator Michel Barnier and his changing UK counterparts (David Frost served for the final stage from 2019-2020) to discuss both the Withdrawal Agreement[10] as well as the consecutive Trade and Cooperation Agreement (TCA).[11] While the first extended the applicability of the relevant EU PIL Regulations for proceedings instituted, contracts concluded or events occurred during the transition period until 31 December 2020,[12] the latter contained from that point onwards effectively no provision for these matters, with the exception of the enforcement of intellectual property rights.[13] Thus, with regard to civil judicial cooperation, the process of leaving the EU led to – what is eloquently referred to elsewhere as – a “sectoral hard Brexit”.[14]

With no tailor-made agreement in place, the state of EU-UK judicial cooperation technically fell back to the level of 1973 before the UK’s accession to the European Communities. In fact, – in addition to the cases from the transition period – the choice of law rules of the Rome I and Rome II-Regulations previously incorporated into the domestic law, remained applicable as so-called retained EU law (REUL) due to their universal character (loi uniforme).[15] However, this approach was not appropriate for legal acts revolving around the principle of reciprocity, particularly in International Civil Procedure.[16] Hence, a legal stocktaking was required in order to assess how Brexit affected the status of those pre-existing multilateral conventions and bilateral agreements with EU Member States that had previously been superseded by EU law.

First, the UK Government has been exemplary in ensuring the “seamless continuity” of the HCCH 2005 Choice of Court Convention throughout the uncertainties of the whole withdrawal process, as evidenced by the UK’s declarations and Note Verbale to the depositary Kingdom of the Netherlands.[17] The same applies mutatis mutandis to the HCCH 1965 Service Convention, to which all EU Member States are parties, and the HCCH 1970 Evidence Convention, which has only been ratified so far by 23 EU Member States. Second, some doubts arose regarding an ipso iure revival of the original Brussels Convention of 1968,[18] the international treaty concluded on the occasion of EU membership and later replaced by the Brussels I Regulation when the EU acquired the respective competence under the Treaty of Amsterdam.[19] Notwithstanding the interesting jurisprudential debate, these speculations were effectively put to a halt in legal practice by a clarifying letter of the UK Mission to the European Union.[20] Third, there are a number of bilateral agreements with EU Member States that could be reapplied, although these can hardly substitute for the Brussels regime, which covers most of the continental jurisdictions.[21] This is, for example, the position of the German government and courts regarding the German-British Convention of 1928.[22]

It is evident that this legal patchwork is not desirable for a major economy that wants to provide for legal certainty in cross-border trade, which is why the UK Government at an early stage sought to enter into a more specific framework with the European Union. First and foremost, the Johnson Ministry was dedicated to re-access the Lugano Convention[23] which extended the Brussels regime to certain Member States of the European Free Trade Association (EFTA)/European Economic Area (EEA) in its own right.[24] Given the strong resentments Brexiteers showed against the CJEU during their campaign this move is not without a certain irony, as its case law is also crucial to the uniform interpretation of the Lugano Convention.[25] Whereas Switzerland, Iceland and Norway gave their approval, the European Commission answered the UK’s application in the negative and referred to the HCCH Conventions as the “framework for cooperation with third countries”.[26] What some may view as a power play by EU bureaucrats could also fairly be described as a necessary rebalancing of trust and control due to the comparatively weaker economic and in particular judicial integration with the United Kingdom post-Brexit.[27] At the very least, the reference to the HCCH reflects the consistent European practice in other agreements with third countries.[28]

Be that as it may, if His Majesty’s Government implements its ratification plan as diligently as promised, the HCCH 2019 Judgments Convention may well be the first new building block in the reconstruction what has been significantly shattered on both sides by the twists and turns of Brexit.

II. (Prospective) Terms of Judicial Cooperation

Even if the path of EU-UK Judicial Cooperation has eventually led to The Hague, there is still a considerable leeway in the implementation of international common rules.

Fortunately, the UK Government has already put forward a roadmap for the HCCH 2019 Judgments Convention in its responses to the formal consultation carried out from 15 December 2022 to 9 February 2023[29] as well as the explanatory memorandum to the Draft Recognition and Enforcement of Judgments Regulations 2024.[30] Generally speaking, the UK Government wants to implement the HCCH Convention for all jurisdictions of the United Kingdom without raising any reservation limiting the scope of application. Being a devolved matter, this step requires the Central Government to obtain the approval of a Northern Ireland Department (Roinn i dTuaisceart Éireann) and the Scottish Ministers (Mhinistearan na h-Alba).[31] Furthermore, this approach also implies that there will be no comparable exclusion of insurance matters as under the HCCH 2005 Convention.[32] However, the Responses contemplated making use of the bilateralisation mechanism in relation to the Russian Federation upon its accession to the Convention.[33]

Technically, the Draft Statutory Instrument employs a registrations model that has already proven successful for most recognition and enforcement schemes applicable in the UK.[34] However, registration within one jurisdiction (e.g. England & Wales) will on this basis alone not allow for recognition and enforcement in another (e.g. Scotland, Northern Ireland), but is rather subject to re-examination by the competent court (e.g. Court of Session).[35] This already constitutes a significant difference compared to the system of automatic recognition under the Brussels regime. Moreover, the draft instrument properly circumvents the peculiar lack of an exemption from legalisation in the HCCH 2019 Convention by recognizing the seal of the court as sufficient authentication for the purposes of recognition and enforcement.[36] It remains to be seen if decisions of third states “domesticated” in the UK under the common law doctrine of obligation will be recognized as judgments within the European Union. If the CJEU extends the position taken in J. v. H Limited to the HCCH 2019 Judgments Convention, the UK may become an even more attractive gateway to the EU Single Market than expected.[37] Either way, the case law of the CJEU will be mandatory for 26 Contracting States and thus once again play – albeit not binding – a dominant role in the application of the HCCH legal instrument.

As far as the other legal means of judicial cooperation are concerned, the House of Lords does not yet appear to have given up on accession to the Lugano Convention.[38] Nevertheless, it seems more promising to place one’s hopes on continued collaboration within the framework of the HCCH. This involves working towards the reconstruction of the remaining foundational elements previously present in EU-UK Judicial Cooperation by strengthening the HCCH Jurisdiction Project and further promoting the HCCH 1970 Evidence Convention in the EU.

III. Conclusion and Outlook

After all, the United Kingdom’s withdrawal from the European Union has dealt a serious blow to judicial cooperation across the English Channel. A look back at the history of Brexit and the subsequent negotiations has revealed that the separation process is associated with an enormous loss of trust. Neither could the parties agree on a specific set of rules under the TCA, nor was the European Union willing to welcome the United Kingdom back to the Lugano Convention.

Against this background, it is encouraging to see that both parties have finally agreed on the HCCH as a suitable and mutually acceptable forum to discuss the future direction of EU-UK Judicial Cooperation. If Brexit ultimately brought about a reinvigorated commitment of the United Kingdom to the HCCH Project, this might even serve as an inspiration for other States to further advance the Hague Conference’s ambitious goal of global judicial cooperation. Then the prophecies of the old songs would have turned out to be true, after a fashion. Thank goodness!

 

[1]    HL Int. Agreements Committee, 11th Report of 8 May 2024 “Scrutiny of international agreements: 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters” (HL Paper 113), para. 1. According to sec. 20 (1) (a) and (2) of the Constitutional Reform and Governance Act 2010 (c. 25) is a treaty not ratified unless a Minister of the Crown has laid a copy before parliament for a period of 21 sitting days.

[2]    Convention on the recognition and enforcement of foreign judgments in civil or commercial matters (HCCH 2019 Judgments Convention) of 2 July 2019, UNTS I-58036 and Tractatenblad 2024, 42 (Verdragsnr. 013672).

[3]    Civil Procedure Rule Committee, Minutes of 1 December 2023, para. 28

[4] See inter alia, Mason, “How did UK end up voting to leave the European Union?”, The Guardian of 24 June 2016; Boffey, “Cameron did not think EU referendum would happen, says Tusk”, The Guardian of 21 January 2019; Duff, “David Cameron’s EU reform claims: If not ‘ever closer union’, what?”, Blogpost of 26 January 2016 on Verfassungsblog | On Matters Constitutional; von Lucke, “Brexit oder: Die verzockte Demokratie”, Blätter 8/2016, 5 et seq.

[5] UK Electoral Commission, “23 June 2016 referendum on the UK’s membership of the European Union”, Report of September 2016, p 6.

[6] Compare Haughton, “Ruling Divisions: The Politics of Brexit”, Perspectives on Politics 19 (2021), 1258, 1260; Özlem Atikcan/Nadeau/Bélanger, “Framing Risky Choices: Brexit and the Dynamics of High-stakes Referendums”, p. 44.

[7] E.g. Rankin, “Is the leave campaign really telling six lies?”, The Guardian of 7 June 2016.

[8] This finding might look different for International Family Law, according to Beaumont, “Private International Law concerning Children in the UK after Brexit: Comparing Hague Treaty Law with EU Regulations”, Child & Fam. L. Q. 29 (2017), 213, 232: “In all these matters students, practitioners and judges will be grateful to have fewer operative legal regimes post-Brexit”.

[9] For example, on this blog Fitchen, “Brexit: No need to stop all the clocks”, Blogpost of 31 January 2020 or Lutzi, “Brexit: The Spectre of Reciprocity Evoked Before German Courts”, Blogpost of 13 December 2020.

[10] Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (Withdrawal Agreement) of 24 January 2020, OJ EU CI 384/1.

[11] Trade and Cooperation Agreement between the European Union and the European Atomic Energy Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part (TCA) of 30 December 2020, OJ EU L 149/10.

[12] Art. 126 of the Withdrawal Agreement.

[13] Compare Chapter 3: Art. 256-273 of the TCA.

[14] Bert, “Judicial Cooperation in Civil Matters: Hard Brexit After All?”, Blogpost of 26 December 2020 on Dispute Re§olution Germany.

[15] Sec. 3 (1) European Union (Withdrawal) Act 2018, Chapter 16/2018, sec. 10, 11 The Law Applicable to Contractual Obligations and Non-Contractual Obligations (Amendment etc.) (EU Exit) Regulations 2019, SI 2019/834; For the current status of the Retained EU Law, see House of Commons Library “The end of REUL? – Progress in reforming retained EU law”, Research Briefing No.°09957 of 2 February 2024 (author: Leigh Gibson).

[16] Implicitly Dickinson, “Realignment of the Planets – Brexit and European Private International Law”, IPRax 2021, 213, 217 et seq.

[17] See Notes Verbales of the United Kingdom to the Kingdom of the Netherlands in its capacity as depositary of the HCCH 2005 Judments Convention from 28 December 2018 to 28 September 2020 in the Treaty Database.

[18] Convention on jurisdiction and the enforcement of judgments in civil and commercial matter (Brussels Convention) of 27 September 1968, OJ EU L 229/31; See e.g. Rühl, “Judicial Cooperation in Civil and Commercial Matters after Brexit: Which Way Forward?”, ICLQ 67 (2018), 99, 104 et seq.

[19] Art. 73m of the Treaty of Amsterdam amending the Treaty on European Union, the Treaties establishing the European Communities and certain related acts of 2 October 1997, OJ EU C 340/1.

[20] UK Mission to the European Union, Letter to the Council of the European Union of 29 January 2021, NO 17/2021.

[21] See, for example, the Agreement on the continued Application and Amendment of the Convention between the Government of the United Kingdom and the Government of Norway providing for the Reciprocal Recognition and Enforcement of Judgments in Civil Matters singed at London on 12 June 1961, SI 2020 No. 1338.

[22] Convention on the Facilitation of Legal Proceedings in Civil and Commercial Matters between His Majesty and the President of the German Reich of 20 March 1928; RGBl. 1928 II Nr. 47; for the position of the German Government, please refer to German Federal Government “Response to the parliamentary enquiry on judicial cooperation in civil matters with the United Kingdom post-Brexit”, BT-Drucks. 19/27550 of 12 March 2021, p. 3, for a recent decision of the German Judiciary, see Higher Regional Court of Cologne, Decision of 2 March 2023, I-18 U 188/21, paras. 60 et seq.

[23] Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Lugano Convention) of 30 October 2007, OJ EU L 339/3.

[24] With the notable exception of Liechtenstein.

[25] Art. 64 Lugano Convention as well as the Protocol concerning the interpretation by the Court of Justice of 3 June 1971, OJ EU L No°204/28.

[26] For the consent of the other Contracting State (except Denmark), see Swiss FDFA, “Communications by the depositary with respect to the application of accession by the United Kingdom”, Notification of 28 April 2021, 612-04-04-01 – LUG3/21; for the rejection of the EU Commission, Note Verbale to the Swiss Federal Council of 22 June 2021 and, “Assessment on the application of the United Kingdom of Great Britain and Northern Ireland to accede to the 2007 Lugano Convention”, COM(2021) 222 final of 4 May 2021, pp. 3 et seq. However, this decision was not without criticism, for example by the Chair-Rapporteur of the OHCHR Working Group on the issue of human rights and transnational corporations and other business enterprises in a letter to the EU Commission of 14 March 2024.

[27] For these arguments see EU Commission, “Assessment on the application of the United Kingdom of Great Britain and Northern Ireland to accede to the 2007 Lugano Convention”, COM(2021) 222 final of 4 May 2021, p. 3 and European Parliamentary Research Service (EPRS), “The United Kingdom’s possible re-joining of the 2007 Lugano Convention” Briefing PE 698.797 of November 2021 (author: Rafa? Ma?ko), pp. 3 et seq. For a theoretical foundation, see M. Weller, “ ‘Mutual Trust’: A Suitable Foundation for Private      International Law in Regional Integration Communities and Beyond”, RdC 423 (2022), 37, 295 et seq.

[28] See e.g. Art. 24 of the Association Agreement between the European Union and its Member States, of the one part, and Ukraine, of the other par, OJ EU No°L 161/3: “The Parties agree to facilitate further EU-Ukraine judicial cooperation in civil matters on the basis of the applicable multilateral legal instruments, especially the Conventions of the Hague Conference on Private International Law in the field of international Legal            Cooperation and Litigation as well as the Protection of Children”. Until recently, the regulation of judicial cooperation specifically in and for extra-EU trade relations appeared to be aout of sight, see M. Weller, “Judicial cooperation of the EU in civil matters in its relations to non-EU States – a blind spot?”, in Alan Uzelac/Rhemco van Rhee (eds.), Public and Private Justice (PPJ) 2017: The Transformation of Civil Justice, Intersentia 2018, pp. 63 et seq.

[29] UK Ministry of Justice, The Hague 2019 – Response to Consultation of 23 November 2023 (“Responses”).

[30] Draft Statutory Instruments 2024 No. XXX Private International Law: The Recognition and Enforcement of Judgments (2019 Hague Convention etc.) Regulations 2024 (“Draft Guidelines”). The competence to make regulations in that respect is based on sec. 2 (1) of the Private International Law (Implementation of Agreements) Act 2020 (c. 24). According to sec. 2 (11) read in conjunction with sched. 6 paras. 4 (2) (a) and (d) draft regulations need to be laid before parliament for approval of each House by a resolution.

[31] Sec. 2 (12) Private International Law (Implementation of Agreements) Act 2020 (c. 24); see also Letter from the Scottish Minister for Victims and Community Safety of 19 March 202 regarding the “UK SI Notification – The Recognition and Enforcement of Judgments (2019 Hague Convention etc) Regulations 2024”.

[32] See Response, para. 51; a similar discussion took place regarding “mixed litigation issues”, where only certain elements are within the scope of the HCCH 2019 Judgments Convention.

[33] Responses, para. 53.

[34] See inter alia the Administration of Justice Act 1920, Chapter 81/1920 (Regnal. 10 & 11 Geo 5) or the Foreign Judgments (Reciprocal Enforcement) Act 1933, Chapter 13/1933 (Regnal. 23 & 24 Geo 5.

[35] Sec. 15 Draft Guidelines and Draft Explanatory Memorandum, para. 5.5.5.

[36] Sec. 12 Draft Guidelines; Garcimartin/Saumier, HCCH 2019 Judgments Convention: Explanatory Report, para. 307.

[37] See CJEU, Judgment of 7 April 2022, J. v. H. Limited, C-568/20, para. 47. However, there is a certain chance that this case law will be corrected in the upcoming revision process of the Brussels Ibis-Regulation, see e.g. Hess/Althoff/Bens/Elsner/Järvekülg, “The Reform of the Brussels Ibis Regulation”, MPI Luxembourg Research Paper Series N.°2022 (6), proposal 15.

[38] HL Int. Agreements Committee, 11th Report of 8 May 2024 “Scrutiny of international agreements: 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters” (HL Paper 113), para. 17: “Many stakeholders have called for the Government to continue its efforts to join the Lugano Convention in addition to ratifying Hague 2019. We agree that the Government should do so.”

Xandra Kramer (Erasmus University Rotterdam and Utrecht University) and Laura Carballo Piñeiro (University of Vigo) edited Research Methods in Private International Law – A Handbook on Regulation, Research and Teaching. The book, which has just been published by Edward Elgar in its Handbooks of Research Methods in Law series, offers perspectives on the diverse methodological approaches […]

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