Agrégateur de flux

By a decision of 21 December 2023, the Danish Supreme Court held that a Swedish default judgment concerning a loan agreement could not be enforced in Denmark on the ground that the service procedure that preceded the judgment was inadequate in an international situation.

In 2014, a Swedish bank filed a plaint in a Swedish court to sue a debtor for not fulfilling a loan agreement. As the defendant did not appear after the court had fulfilled the Swedish standards for service of documents, a default judgment was rendered. In 2022, the bank asked the Swedish court for a certificate under Article 53 of the Brussels I bis Regulation. With that certificate, the bank sought enforcement of the Swedish default judgment in a Danish court. Both the Danish court of first instance and the Danish court of appeal held that the Swedish judgment was enforceable in Denmark under the Brussels I bis Regulation. However, the Danish Supreme Court came to a different conclusion.

First, the Danish Supreme Court found that the lower instances’ application of the Brussels I bis Regulation was wrong as the Swedish proceedings had been initiated before 15 January 2015. Under Article 66 para. 1 of the Brussels I bis Regulation, it is the older Brussels I Regulation that applies for matters initiated before that date. Here, it can be noted that both regulations are applicable in Denmark despite Denmark’s special status in EU’s civil law cooperation due to a parallel agreement between the EU and Denmark.

The exceptions to the rule on presumption for enforcement of judgments from other member states in Article 45 follow from Articles 4 and 35 in the Brussels I Regulation. Article 34 para. states that it is a ground for refusal that a default judgment has been rendered without the defendant having been duly served. With reference to the CJEU’s judgments C-327/10, Hypoteční banka, EU:C:2011:745, and C-292/10, Cornelius de Visser, EU:C:2012:142, the Danish Supreme Court held that the Brussels I Regulation requires a court to investigate the domicile of the defendant to fulfil its service obligations. Though the domicile of the defendant was unknown to the Swedish court, it was clear to that court that the defendant was a Danish citizen. Nonetheless, the Swedish court made no investigations into whether the defendant was domiciled there. Consequently, the Danish Supreme Court held that the Swedish default judgment may not be enforced in Denmark.

The Danish Supreme Court decision is a good example of the practical application of the “principles of diligence and good faith” that the CJEU set as a standard for the investigations that a court must perform to trace a defendant. To investigate whether a defendant has regained domicile in a country where he or she is a citizen or to which he or she has a strong connection is probably an absolute minimum requirement.

Even if the presumption for recognition and enforcement has been changed between the old Brussels I Regulation and the Brussels I bis Regulation, it is noteworthy that the same ground for recognition exists also in Article 45 (1)(b) of the Brussels I bis Regulation.

A on online conference on the international recovery of maintenance by public bodies is set to take place on 15 May 2024, between 2 and 5 pm CEST, hosted by the German Institute for Youth Services and Family Law (DIJuF).

The event concept is as follows.

The Child Support forum is pleased to invite every interested stakeholder to an open conference deepening the topic of cross-border maintenance recovery by public bodies.

Due to the increase in international mobility of families, the need for immediate child support in case of default of maintenance payment is growing. This support often consists of advance maintenance payments granted by public authorities, which then must be reimbursed by the debtor. The enormous sums of money that states spend on these benefits make the cross-border enforcement of maintenance by public bodies an important political issue. 

The first three meetings of the Child Support Forum showed that there is a great need for exchange between the public bodies. On the one hand, they face different hurdles in enforcing their claims due to the diversity of the maintenance support systems. On the other hand, common problems were also identified. The results of this work will be presented.

In a future perspective, it is clear that the tension between the need for more support for children, for an effective recovery of maintenance against debtors, and debtor protection is growing. It will be interesting to discuss to what extent the States make the grant of benefits dependent on the legal possibilities for reimbursement. For example, in the light of the text of the 2007 Convention and of the EU-Maintenance Regulation, public bodies currently have less support from Central Authorities when they seek reimbursement of maintenance support than children do when they claim child maintenance. Thus, the question arises as to whether debtor protection still justifies this legal situation and how maintenance debtors can be protected from double claims when it is no longer the child alone but a public body that seeks the recovery of maintenance payments.

The conference will mark the end of a series of three seminars on the topic of maintenance recovery by public bodies and is intended to provide insight into its socio-political and legal aspects as well as a unique opportunity for exchange with experts from different fields (academics, Central Authorities, public bodies from different countries). 

The conference program can be found here. Attendance is free, but prior registration (here) is required.

The fourth issue of 2023 of the Rivista di diritto internazionale privato e processuale (RDIPP, published by CEDAM) was just released. It features:

Cristina Campiglio, Professor at the University of Pavia, Giurisdizione e legge applicabile in materia di responsabilità medica (ovvero a proposito di conflitti di qualificazioni) [Jurisdiction and Applicable Law in Matters of Medical Liability (Namely, on the Issue of Conflicts of Characterisation); in Italian]

An attempt has been made to give an account of the conflicts of qualification that characterise the healthcare sector, starting with the contractual or non-contractual nature of civil liability for malpractice. We then looked at the nature of the healthcare contract to assess whether patients can fall into the category of consumers and consequently enjoy the protection reserved to them. Finally, reference was made to the qualification of the patient’s self-determination as an expression of the right to privacy rather than the right to physical integrity. Research on the nature of civil liability in a field – the health sector, as said – where many activities are potentially harmful to the physical integrity of the patient so that the health-care operator might be held accountable of culpable personal injury or even of manslaughter, provided an opportunity to analyse the practice of the Court of Justice relating to the qualification of “contractual matters” and indirectly of the non-contractual matter of culpable “tort”; and to note how the Court, in recent years, on the one hand has openly espoused an extensive interpretation of “contractual matters”, and on the other hand has missed the chance to speak out on hypotheses of non-contractual liability in contractual contexts, or of concurrence of contractual and non-contractual liability. It is to be hoped that the European Union will become aware of the need to provide ad hoc rules on the liability of healthcare personnel who engage in activities that are intrinsically hazardous to patients’ health: if not substantive rules or guidelines, at least rules on jurisdictional competence and applicable law.

Olivia Lopes Pegna, Professor at the University of Florence, Continuità interpretativa e novità funzionali alla tutela dell’interesse del minore nel regolamento Bruxelles II-ter (Continuity in Interpretation and Novelties Functional to the Protection of the Interest of the Child in the Brussels IIb Regulation; in Italian)

This article aims at illustrating the main innovations introduced in the Brussels regime on parental responsibility and protection of children with the Recast: i.e., Regulation (EU) No 2019/1111 (“Brussels II-ter”). While, on the one side, interpretation and application of the Recast Regulation mandate continuity with the jurisprudence of the Court of Justice of the European Union, on the other side the novelties introduced with the Recast show an increased penchant towards flexibility in order to achieve the protection of the actual and concrete best interests of the child.

Edoardo Benvenuti, Research Fellow at the University of Milan, Climate change litigation e diritto internazionale privato dell’Unione europea: quale spazio per la tutela collettiva? (Climate Change Litigation and EU Private International Law: Is There Room for Collective Redress?; in Italian)

With the worsening of the climate crisis, the EU is adopting a number of measures – both in the public and private sector – in order to counter such phenomenon. The layering of substantive norms and standards goes hand in hand with the growing interest towards procedural tools suitable to make the application of such rules effective through private enforcement. Against this background, and given the collective and the ubiquitous dimension of the consequences of climate change, the present article explores the phenomenon of collective redress in the field of climate change litigation. After introducing the definitions and the characteristic features of climate change litigation and collective redress, the article examines the role of Regulations (EU) No 1215/2012 and (CE) No 864/2007, in order to evaluate their ability to address the private international law issues arising from collective and climate change litigation. In doing so, the article focuses on the relevant case-law (both national and of the CJEU), as well as on Directive (EU) 2020/1828 on consumers’ representative actions, which provides a number of propositions that can be applied also in the context of climate change litigation. Once the main critical aspects have been identified, the article puts forth some reform suggestions to strengthen EU private international law mechanisms in the context of environmental mass torts.

This issue also comprises the following comment:

Ginevra Greco, Researcher at the University of Milan, Il c.d. uso alternativo del rinvio pregiudiziale di interpretazione (The So-Called Alternative Use of the Referral for a Preliminary Ruling on Interpretation; in Italian)

This article endeavours to show that, contrary to popular opinion, the interpretative judgments of the Court of Justice of the European Union, which use the terms “precludes” or “does not preclude”, are genuine judgments on the conformity of a national act or measure with EU law. This article also aims to illustrate the compatibility of those judgments with the model of Article 267 TFEU. This conclusion is supported not by the fact that such judgments are devoid of application profiles, but because they remain within the scope of the interpretative function of the Court of Justice, understood not as abstract interpretation, but as an interpretation which contributes to the resolution of the concrete case pending before the referring court.

Furthermore, in the Chronicles section, this issue includes:

Anna Facchinetti, Researcher at the University of Milan, Immunità degli Stati ed exequatur di sentenze straniere in materia di terrorismo: una recente pronuncia della Corte di Cassazione francese (State Immunity and Exequatur of Foreign Judgments on Terrorism: A Recent Ruling by the French Court of Cassation; in Italian).

Finally, the following book review by Fausto Pocar, Emeritus Professor at the University of Milan, is featured: Albert Venn DICEY, John Humphrey Carlile MORRIS, Lawrence COLLINS, Dicey, Morris & Collins on The Conflict of Laws, 16th ed., Sweet & Maxwell, London, 2022, 2 voll., pp. cdxli-2476-LXXI; Companion vol., EU Withdrawal Transition Issues, pp. li-162.

The first issue of the Journal du droit international for 2024 has been released. It contains two articles and several case notes relating to private international law issues.

In the first article, Héloïse Meur (Paris VIII University) analyses new French provisions on PIL aspects of unfair commercial practices (Entre la lettre et l’esprit de la loi EGALIM 3, quel avenir pour le droit international privé du « petit » droit de la concurrence ?).

The English abstract reads:

For the first time, the French Lawmaker enacted provisions related to private international law aspects of unfair commercial practices law. Article 1 of the law of 30 March 2023 to strengthen the balance in commercial relations between suppliers and distributors, known as the “EGALIM 3” or “Descrozaille” law, states that the rules related to restrictive practices and price transparency apply “to any agreement between a supplier and a buyer relating to products or services marketed on French territory. These provisions are a matter of public policy. Any dispute relating to their application falls within the exclusive jurisdiction of the French courts, subject to compliance with European Union law and international treaties ratified or approved by France, and without prejudice to recourse to arbitration”. This provision would make it possible to fight the circumvention strategies of large retailers, which consist in setting up purchasing entities abroad and concluding choice of law and choice of forum clauses to avoid the application of the provisions of the French Commercial Code. However, by refusing to refer to traditional concepts of private international law such as the overriding method of mandatory provisions (“lois de police”), the French lawmaker leaves open the question of the impact of the amendments on positive private international law and further adds to the important legal uncertainty in this field of law. This paper proposes to analyse the causes of these omissions to hope to guarantee more legal certainty for international contracts in general and distribution contracts in particular, contracts initially targeted by unfair trading practices law.

In the second article, Alejandra Blanquet (Paris-Est Créteil University) examines the difficult coordination between kafalaand adoption in cross-border context following a Franco-Spanish comparative perspective (L’articulation entre kafala et adoption : le cas espagnol et ses enseignements pour le droit international privé français).

The English abstract reads:

The adoption of children with ‘personal prohibitive status’ is forbidden by way of law in Spain and France. It results in any gateway between kafala, and adoption being closed. However, the firmness of this statement must be qualified. Indeed, by retaining a soften approach of it some Spanish Audiencias provinciales have recently allowed certain kafalas to become adoptions. This new approach is based on a selective gateway opened to judicial kafalasconstituted in respect of makfouls abandonned in their home country. This kind of kafalas may therefore, in some cases, become adoptions. This mechanism does not mean that the statutory prohibition is repealed but confirms the extent to which its force may be subject to modulations in order to avoid the excessiveness in which its strict implementation may result in some cases. The selective gateway requires the best interest of the child to be assessed in concreto and invites the judge to analyse, and if necessary to relativise the effects of an international “flawed” adoption. Thus, the Spanish example shows that the discussion on the link between kafala and adoption is far from being over and offers new perspectives for analysing the question in both Spanish and French Law.

The table of contents of the issue can be accessed here.

Authors: Abubakri Yekini (Lecturer in Conflict of Laws at the University of Manchester) and Chukwuma Okoli (Assistant Professor in Commercial Conflict of Laws at the University of Birmingham, Senior Research Associate at the University of Johannesburg).

A  Introduction

In an increasingly globalised economy, commercial transactions often involve business entities from different countries. These cross-border transactions present complex legal questions, such as the place where potential disputes will be adjudicated. To provide certainty, commercial parties often conclude ex ante agreements on the venue for dispute resolution by selecting the court(s) of a particular state. However, what happens if no such agreement over venue is reached for resolving a contractual dispute? Could consent to the venue be implicitly inferred from the parties’ conduct or other factors?

Explicit jurisdiction clauses offer cross-border litigants the benefit of predictability by allowing them to anticipate where disputes arising from their commercial transactions will be resolved. However, business entities sometimes neglect to include express provisions for the venue, whether inadvertently or due to their inexperience. In such cases, firms may have implicitly agreed on a venue through their actions or based on their tacit understanding. This type of ‘unwritten’ jurisdiction agreement remains largely unexplored in the legal scholarship.

Relatively recently, the validity or enforceability implied jurisdiction agreements arose in the Privy Council case of in the Privy Council Case of Vizcaya Partners Ltd v Picard & Anor [2016] UKPC 5. In this Case, following a comprehensive survey of the existing academic and judicial authorities, Lord Collins held that since it is commonplace for a contractual agreement or consent to be implied or inferred, ‘there is no reason in principle why the position should be any different in the case of a contractual agreement or consent to the jurisdiction of a foreign court’. However, in the wake of the above Case, the notion of an implied jurisdiction agreement drew limited scholarly research attention (for instance, see Kennedy, (2023);  Kupelyants, 2016). Moreover, there has been no systematic analysis of how it aligns with the needs of the international business community.

In our latest article, published in the 2023 edition of the Journal of Private International Law, vol. 19(3), we examine the enforceability of implied jurisdiction agreements from a global comparative perspective. Therefore, our paper provides the first comparative global perspective of the enforcement of implied jurisdiction in international contracts. Our analysis reveals uncertain and subjective standards for implied jurisdiction agreements, which undermine the needs of international commerce. While limited scenarios may justify enforcing implied jurisdiction agreements, our paper advocates restraint, given that the criteria for inferring consent are complex, unpredictable, and variable across legal systems.

B  Implied Jurisdiction Agreements Create Uncertainty for Business

The main thesis of our article is that implied jurisdiction undermines the core needs of business entities engaging in cross-border commercial transactions. These entities value legal certainty and predictability, in order to make informed choices and plan business activities. However, by their very nature, implied terms offer less clarity concerning the governing law and jurisdiction agreements.

Our article likewise surveys primary legal sources across common law, civil law and mixed legal systems (as well as insights from academics and practising lawyers), assessing whether implied jurisdiction agreements are widely recognised. We find limited consensus on the conduct that demonstrates implied consent or agreement to litigate in a particular forum. Factors such as previous interactions between contracting parties and trade usage in an industry are highly subjective. Even common law tests for inferring implied terms, like the ‘officious bystander’ and ‘business efficacy’ rule, fail to clarify how these terms apply specifically to international jurisdiction.

This uncertainty requires the courts to undertake a complex, case-by-case analysis of parties’ unspoken intent. However, companies benefit from consistency in interpreting cross-border transactions, whereas a lack of clarity risks complicating commercial disputes, rather than resolving them efficiently. Overall, the unclear standards surrounding implied jurisdiction agreements are incapable of delivering the stability required by global businesses when operating across legal systems.

C Treatment under International Conventions 

International treaties are aimed at harmonising divergent national laws and policies on jurisdiction, applicable law, and the recognition and enforcement of foreign judgments.  The 2005 Hague Convention on Choice of Court Agreements (HCCA) governs exclusive choice of court agreements from a global perspective. Articles 3(c) and 5(1) address formal and substantive validity. Our paper suggests that the requirement for the written form under Article 3(c) may present challenges in implying jurisdiction agreements. Consequently, it is difficult to envision situations where implicit jurisdiction agreements could arise under the Hague Choice of Court Convention, given that the initial hurdle is the requirement for the agreement to be in writing.

The spirit of the HCCA is further reflected in the 2019 Hague Judgments Convention, which seeks to promote express – as opposed to implicit – jurisdiction agreements between parties. For instance, Article 5 of the Convention exhaustively lists permitted grounds for establishing international jurisdiction. This provides clarity for commercial parties who are litigating abroad. Consequently, implied jurisdictions agreements are conspicuously absent and so the policy favours explicit consent. Accordingly, we argue that the emerging global consensus dictates caution around enforcing implied jurisdiction agreements that could disrupt settled jurisdictional principles in the international context.

Brussels Ia and the Lugano Convention share provisions for the validity of a jurisdiction agreement. Namely, consent must be in writing, or evidenced in writing. This aligns with the Hague frameworks: the HCCA and the Judgments Convention. While some scholars argue for the validity of implied jurisdiction agreements in specific contexts (especially trade usage and previous dealings between parties), the prevailing view requires clear and precise consent. By way of illustration, CJEU’s stance in Cases like Galeries Segoura  SPRL, ProfitInvestment SIM SpA and Colzani,  implies a stringent approach to consent.

D  Should Implied Jurisdiction Agreements be Enforced?

In section IV of our paper, we examine the justification and rationale for the recognition or otherwise of implied jurisdiction agreements, having, inter alia, considered the diverse approaches adopted by the many courts across the globe.

1. Business Efficacy and Commercial Expectations

Party autonomy, a cornerstone of private international law, emphasises the importance of upholding the presumed intentions of the contracting parties. The recognition of implied jurisdiction agreements potentially aligns with the principle of party autonomy, since it seeks to fill gaps in contracts and thereby reflect the parties’ unexpressed intentions, as noted by Lord Neuberger. In the context of English law, Lord Collins relied on the business efficacy and officious bystander analogy to imply jurisdiction agreements in Vizcaya.

Additionally, the application of business efficacy logic can mitigate challenges such as parallel proceedings or the fragmentation of disputes. Extending a jurisdiction agreement to closely related contracts, even in the absence of explicit terms, will reduce uncertainty and meet commercial expectations. Certainty, convenience, and the efficient administration of justice are paramount considerations for rational businessmen who would rather not litigate in separate courts. Nonetheless, Cases like Terre Neuve Sarl v Yewdale Ltd [2020] and Etihad Airways PJSC v Flother [2020] reveal complexities in ascertaining commercial expectations and business efficacy. Divergent approaches to interpreting and implying terms, coupled with the challenge of defining what constitutes a reasonable businessperson, further contribute to the uncertainty and unpredictable outcomes.

    2. The Choice of Law Analogy

Implied choice of law is well-established in private international law. Moreover, it is recognised in various international instruments and across common law, mixed, and civil law jurisdictions. While jurisdiction and choice of law are distinct, the underlying principle of implied choice of law may apply to implied jurisdiction agreements.

Globally, the interrelationship between jurisdiction and choice of law is acknowledged. For instance, the CJEU emphasises a consistent approach to determining both. The applicable law of a contract, while not determinative of jurisdiction, remains significant. However, challenges arise when parties fail to expressly state the applicable law, leading to a strict standard for implying the choice of law based on a number of factors.

Despite the recognition of implied choice of law, we argue against transposing this principle directly to the question of jurisdiction. Jurisdiction involves the exercise of state powers over litigants, and while implied choice of law may indicate a governing law, it does not necessarily imply submission to the jurisdiction of a specific court. Instead, the distinct nature of jurisdiction agreements calls for a nuanced approach.

     3. International Jurisdiction and the Recognition of Foreign Judgments

Implied jurisdiction agreements play a dual role, serving as a basis for establishing both direct and indirect jurisdiction. Courts often decide on the enforceability of judgments based on the existence of a jurisdiction agreement, whether express or implied.

Different thresholds apply to direct and indirect jurisdiction. This differentiation reflects the complexities involved in establishing jurisdiction in cross-border disputes. While policy considerations may influence the exercise of direct jurisdiction, recognising and enforcing foreign judgments necessitates adherence to some very specific, often stricter, criteria set by the court addressed.

The inherent connection between jurisdiction and judgments underscores the need for certainty in cross-border litigation. Implied jurisdiction agreements lack globally established criteria. This introduces ambiguity and can lead to prolonged legal proceedings, given that litigants will often draw attention to implicit jurisdiction agreements at the enforcement stage. In short, it undermines the efficiency sought in international business transactions.

On the strength of the inefficiency that can arise from an exercise of jurisdiction based on implicit agreements, we argue that the concept of implied jurisdiction agreements adds little (if any) value to the recognition and enforcement of foreign judgments. Conversely, the HCCH 2019 Judgments Convention provides clear jurisdictional grounds, consequently averting the need for implied agreements. The Convention’s carefully drafted criteria support the global pursuit of certainty and predictability in cross-border commercial legal frameworks.

E  Conclusion

In closing, we argue that implied jurisdiction agreements do not align with the needs of international commerce or the emerging global consensus on international jurisdiction. Aside from the very limited recognition of implied jurisdiction agreements under certain international instruments such as Brussels Ia, our study further reveals divergent national approaches to implied jurisdiction agreements. For several reasons, we advocate caution regarding the validity of implicit agreements:

1. Consent is not genuinely mutual if one party disputes the existence of an implied agreement: genuine consent must be clear.
2. Implied agreements provide minimal value: even without them, jurisdiction can be founded on close connections between the contract and forum.
3. The emerging global consensus on jurisdiction, as seen in the HCCH Conventions, emphasises predictability through the requirement for well-defined but restricted grounds. Implied agreements therefore fail to align with the policy behind these instruments and the emerging consensus.

Our overall conclusion is that express jurisdiction agreements should remain the priority for cross-border contracts.

The United Nations Agenda 2030 with its 17 Sustainable Development Goals (SDGs) seems to have a blind spot for the role of private and private international law. That blind spot is beginning to be closed. A collective volume with global outlook published in 2021 addressed “the private side of transforming our world”: each of the 17 SDGs was discussed in one chapter of the book devoted to the specific relevance of private law and private international law. In 2022, the IACL-ASADIP conference in Asunción, Paraguay discussed sustainable private international law with regard to Latin America; the contributions published in 2023 in a special issue of the University of Brasilia Law Journal – Direito.UnB., V.7., N.3 (2023).

In this occasion the focus is on Asia. The Chinese Journal of Transnational Law invites submissions for its Vol. 2 Issue 2, to be published in 2025, engaging critically with the functions, methodologies and techniques of private international law in relation to sustainability from an Asian perspective, as well as in relation to the actual and potential contributions of private international law to the SDGs in Asia.

Contributions should focus on Asian perspectives, either addressing a specific global challenge through the lens of the relevant normative framework of a particular country, sub-region, or community/ies in Asia; or ‘glocalising’ the challenge, analysing specific issues affecting concrete contexts in the region in relation to the global objectives included in the UN 2030 Agenda.

Topics could include, but are not limited to:

• Relationships between the international and the domestic, or/and the public and the private in the pursue of the UN Agenda 2030 in Asia
• Sustainability in global supply/value chains and private international law in Asia
• Intra-regional (South-South) migration in Asia and private international law (focus on specific kinds of migration, such as labour migration, climate change migration, forced displacement, refugees, etc)
• Clean energy in Asia and private international law
• Decent work (and economic growth) in Asia, and of Asian workers beyond Asia, and private international law
• Sustainable consumption and production in Asia and private international law (focus on a specific sector, such as apparel, food, agricultural products, etc)
• Gender equality in Asia and private international law
• Sustainable Asian cities and communities and private international law
• Establishment and proof of personal identity in Asia; portability across borders of identity documents in Asia and beyond
• (Non-) recognition of foreign child marriages and forced marriages in and from Asia
• Availability and sustainable management of water (and sanitation) in Asia and the role of private international law
• Private international law and cross-border environmental damage/ adverse effects of climate change/ loss of biodiversity from an Asian perspective.

Note: The issue of transnational access to justice in relation to sustainable development has been considered extensively, including from an Asian perspective, so we suggest interested contributors to refrain from submitting contributions based exclusively on SDG 16.

An abstract of 500-800 words should be submitted by 15  March 2024 to PIL.sustainability.CJTL@ed.ac.uk and CJTL.Editor@whu.edu.cn (please send the abstract to both email addresses). Please include the contributor’s last name in the email title. Selected contributors will be invited to submit a draft paper by 1 October 2024 in advance of a hybrid conference at Wuhan University in November 2024. The submission of the full article through the journal’s homepage: https://journals.sagepub.com/home/ctl is required by 1 March 2025. Accepted articles will be published online first as advanced articles. Contributors may choose between: Research articles (up to 11,000 words inclusive of footnotes) or short articles (up to 6,000 words inclusive of footnotes). The special issue will be published in September 2025.

Those interested may contact the guest editors Verónica Ruiz Abou-Nigm, Ralf Michaels and Hans van Loon at PIL.sustainability.CJTL@ed.ac.uk.

In its judgment of 8 February 2024, the CJEU had to decide whether “the application of the Brussels Ibis Regulation be based solely on the fact that two parties with their seat in the same Member State agree on the jurisdiction of courts of another EU Member State.”

The case concerned two loans granted to Dúha reality, a Slovak company, by a third party also domiciled in Slovakia, in 2016 and 2017 respectively. Both loan contracts contained an identical choice of forum clause stating that any ‘dispute shall be settled by a court of the Czech Republic having substantive and territorial jurisdiction’. In 2021, the receivables arising from those loan agreements were assigned to Inkreal, another purely Slovak business corporation, who upon non-payment by the debtor brought action in the Czech Republic. Seeking, inter alia, to determine the specific Czech court having territorial jurisdiction, the Czech Supreme Court (Nejvyšší soud) referred the question to the CJEU.

The CJEU engaged in an almost textbook-like analysis of not only the clear wording of Art. 25 Brussels Ibis, which does not contain any restrictictions whatsoever with regard to an additional connection to the chosen or another Member State (para. 17), but also of the purpose of the Regulation to provide legal certainty requiring that the designated court can easily assess its jurisdiction without recourse to the merits of the case (para. 27). Furthermore, the CJEU concluded by an argumentum e contrario to Art. 1(2) HCCH 2005 Choice of Court Convention that the EU legislator, who drew inspiration from the Hague instrument when drafting the recast, was well aware of the issue but deliberately decided against the adoption of a similar provision excluding choice of court agreements in otherwise purely domestic cases from the scope of application (para. 38). As a result, the CJEU answered the question in the affirmative, thereby strengthening party autonomy and predictability in the context of international civil procedure. This is to be welcomed.

The Opinion of 12 October 2023 provided by AG Richard de la Tour had gone to the contrary, namely that an international element must be established “according to objective criteria” whereas the mere subjective choice of a foreign Member State’s court may not suffice to trigger the application of the Brussels Ibis Regulation (para. 32). While elements of the underlying argumentation appear questionable, as discussed elsewhere, the Opinon, interestingly, also put forward that the Brussels systems should be harmonised with the Hague Convention (“the Hague system”?), which might be taken as a reminiscent of a light form of the principle of systemic integration, Art. 31 (3) (c) VCLT. In this respect, the Opinion could also be seen as evidence of a heightened awareness of the increasing role that the CJEU’s decisions could play in the greater picture of international judicial cooperation in civil and commercial matters.

The first issue for Lloyd’s Maritime and Commercial Law Quarterly in 2024 was published recently. It contains the following articles and case notes.

Articles:

Andrew Dickinson, “Electronic trade documents and the conflict of laws in the United Kingdom”

The Electronic Trade Documents Act 2023, which entered into force on 20 September 2023, seeks to facilitate the use of trade documents (including bills of exchange, promissory notes and bills of lading) in electronic form by assimilating these instruments, and their legal effects, to the equivalent paper trade documents, provided that the systems used to process the relevant information meet certain technological requirements. However, the Act contains no provision that expressly addresses the legislation’s cross-border dimension or its relationship to the United Kingdom’s conflict of laws rules. This article considers how these matters should best be addressed in order to secure the Act’s promised economic benefits.

Shane Herbst and Simon Allison, “Breaking the Hague-Visby Rule’s Silence on choice of law and forum clauses: Article 3 revisited”

It is generally assumed that the Hague-Visby Rules are silent on choice of law and forum clauses. However, Art.3(8) can potentially operate to invalidate such clauses; and the general assumption is challenged by reference to Australia’s cargo liability regime. This reality could incentivise jurisdictions wanting to uphold such clauses to construe the Hague-Visby Rules uniformly. Despite this, the limits of Art.3(8) should be clarified. In Australia, reform efforts should address this and other issues with arbitration agreements. As Art.3(8) currently stands, parties must consider its potential effects on dispute resolution provisions in sea-carriage documents.

Case Notes:

Adrian Briggs, “The empire strikes back”

Andreas Giannakopoulos and Adnan Khaliq, “Damages for breach of dispute resolution agreements and EU public policy”

Adrian Briggs, “When arbitration matters”

The Supreme Court of Greece (Areios Pagos) ruled on 22 March 2023 on the validity of a choice of forum agreement concluded between a bank and its clients (Areios Pagos, ruling No. 441/2023).

The key issue in the dispute was whether the bank’s clients ought to be characterised as ‘consumers’ for the purposes of the Brussels I bis Regulation.

Four natural persons, all domiciled in Thessaloniki, brought proceedings in Thessaloniki against a Cypriot bank, seeking compensation for damages suffered as a result of an investment made through the bank. According to the bank, it was a rather secure investment proposal.  The claimant’s expression of interest had been filed with the Thessaloniki branch of the Cypriot bank.

The bank challenged the jurisdiction of the seised court. It relied for this on a clause conferring jurisdiction on Cypriot courts, featured in documents which the bank and its clients had exchanged in preparation of the investment.

Strangely enough, the claimants did not submit a reply to the challenge, and simply failed to produce any supplementary pleadings. As a result, the court of first instance of Thessaloniki upheld the challenge and declined jurisdiction.

The four clients lodged an appeal against the judgement with the Court of Appeal of Thessaloniki. They claimed that they concluded the contracts as consumers, and that the terms and conditions relied upon by the bank, including the choice-of-court clause, were abusive.

The appeal was dismissed on the ground that, at first instance, the clients had failed to take a stance on the bank’s plea of lack of jurisdiction, and had failed to challenge the validity of the bank’s terms and conditions based either on the Greek legislation on consumer protection, or on Article 15 of the Brussels I bis Regulation. The Court of Appeal stressed that, according to Greek procedural law, a failure to raise the above issues at first instance entails that a later challenge is foreclosed.

The Supreme Court reversed the judgement. It began by observing that the clients ought in fact to be characterized as consumers. It then held that the failure to examine ex officio the abusive nature of the choice of forum clause was not a sufficient ground to quash the judgment. In fact, the Supreme Court agreed with the Court of Appeal that the alleged unfairness of a bank’s terms and conditions is not an issue that a first instance court is required, or permitted, to raise by its own motion. The clients only raised the point in the proceedings before the Court of Appeal, which they are barred to do pursuant to Article 527 of the Code of Civil Procedure.

That said, the Areios Pagos held that the Court of Appeal had erred in relying on the (uncontested) plea made by the bank that Greek courts lacked jurisdiction, instead of assessing whether an agreement conferring jurisdiction on Cypriot courts had in fact been entered int between the parties. The Supreme Court observed that the lower courts contented themselves to infer the existence of such an agreement from the fact that the clients failed to reply to the bank’s assertion (an implicit confession within the meaning of Article 261(2) of the Greek Code of Civil Procedure, even though no express reference to that provision had been made by the bank).

Incidentally, the Supreme Court denied the four clients’ request to submit a reference to the Court of Justice of the European Union for a preliminary ruling. It did so on the grounds that the unfairness of a contractual term cab only be assessed against the circumstances existing at the time of the conclusion of the contract and in light of the other clauses of the contract. It  is for the consumer to provide evidence of such circumstances, and he must do so in the manner prescribed by the applicable procedural rules.

The Supreme Court’s assertion whereby the unfairness of a term is not something a court may assess of its own motion, where the consumer failed to raise the issue of unfairness and to provide evidence of the circumstance in which the contract was concluded, demonstrates the need for enhanced dissemination of the case law of the Court of Justice among domestic judicial authorities.

In fact, the Areios Pagos did not mention, let alone discuss, a single ruling of the Court of Justice relating to the seised court’s power to intervene by its own motion for the sake of protecting the rights of consumers. The Court of Justice has already addressed issues in this connection and is witnessing a number of new preliminary references concerning the topic. Especially in regards to ex officio control on second instance, one could refer to the the cases Eva Martín Martín v EDP Editores SL , Erika Jőrös v Aegon Magyarország Hitel Zrt., and Dirk Frederik Asbeek Brusse and Katarina de Man Garabito v Jahani BV.

Finally, some thoughts on the claimants’ alleged tacit approval of the choice of forum clause relied upon by the bank. How could someone assert that a claimant who chose to file an action before a certain court, and has already pleaded on the merits of the case, is later tacitly accepting the lack of that same court’s jurisdiction? One might speculate that the lawyers for the claimants simply forgot to file their brief to contest the plea of the bank: a failure that eventually decided the fate of the claim. This is one reason why courts should be permitted some activism, overcoming the inflexible procedural autonomy that Member States enjoy.

Still, it takes two to tango. By dismissing the request of the claimants for a preliminary reference to the Court of Justice, the Greek Supreme Court shows its reluctance to cooperate and contribute to the consolidation of European Procedural Law.

This book brings together the contributions made at the 6th AEPDIRI Seminar on current issues in Private International Law, held at the Faculty of Law of the University of Seville, which was entitled “De los retos a las oportunidades en el derecho de familia y sucesiones internacional” (From challenges to opportunities in international family and succession law), Campuzano Díaz, B., Diago Diago, P., Rodríguez Vázquez, Mª.A. (dirs.). An English translation of the blurb is provided by the directors:

The book is structured in four thematic sections. The first one is dedicated to Regulation 2019/1111 and its application in Spain, analysing important issues related to international child abduction and divorce before non-judicial authorities and its recognition. The second thematic section is dedicated to the economic regime of marriage and the couple, inheritance and the organisation of family assets, with reflections on the impact of the principle of equality between spouses and the protection of assets through international estate planning institutions, among other issues. The third section deals with questions of civil status and the solutions provided by the Spanish Civil Registry Law, with special attention to filiation in Private International Law from the perspective of the protection of fundamental rights and the respect for family life. The fourth section includes studies about current realities, such as situations of domestic violence in cases of international child abduction, negotiable institutions and their place in the succession Regulations and the interpretation of private international family law in different High Courts (CJEU and ECtHR).

It is a book of great interest, not only because of the importance and diversity of the subjects dealt with, but also because of the important group of specialists in international family and succession law who have participated in its drafting.

The book is published in digital and open access format:

https://open.tirant.com/cloudLibrary/ebook/info/9788411978248

https://www.aepdiri.org/index.php/las-publicaciones/otras-publicaciones/2170-campuzano-diaz-b-diago-diago-p-rodriguez-vazquez-m-a-dirs-de-los-retos-a-las-oportunidades-en-el-derecho-de-familia-y-sucesiones-internacional

The seventh edition of the French leading treatise on the European law of jurisdiction and foreign judgments in civil and commercial matters (Compétence et exécution des jugements en Europe – Règlements 44/2001 et 1215/2012 – Conventions de Bruxelles (1968) et de Lugano (1988 et 2007)) has just been published.

It is authored by Emeritus Prof. Hélène Gaudemet-Tallon and Prof. Marie-Elodie Ancel (both Paris II University).

The blurb reads:

Les textes étudiés dans cet ouvrage – Convention de Bruxelles du 27 septembre 1968, règlements 44/2001 et 1215/2012 – portent sur la compétence directe ainsi que sur la reconnaissance et l’exécution des décisions ; ils doivent assurer la réalisation d’un véritable « espace judiciaire européen » en matière civile et commerciale. Le règlement 1215/2012 (dit Bruxelles I bis) a apporté des modifications substantielles au règlement 44/2001. L’application de ces textes est guidée par une riche jurisprudence de la Cour de justice de l’Union européenne.

Dans le cadre de l’AELE, les Conventions de Lugano de 1988, puis de 2007, ont adopté des systèmes « parallèles », d’abord à la Convention de Bruxelles de 1968 puis au règlement 44/2001. La Convention de 2007 est en vigueur entre tous les États de l’Union européenne, la Norvège, l’Islande et la Suisse.

Cette septième édition, tenant compte de l’évolution des textes et de la jurisprudence ainsi que de la sortie du Royaume-Uni de l’Union européenne, a pour ambition d’être utile non seulement aux universitaires (étudiants et enseignants) s’intéressant au droit international privé européen, mais aussi aux praticiens (magistrats, avocats, notaires) qui appliquent ces textes.

More details are available here.

By Poomintr Sooksripaisarnkit

Lecturer in Maritime Law, Australian Maritime College, University of Tasmania

Introduction

On 14th February 2024, the High Court of Australia handed down its judgment in Carmichael Rail Network Pty Ltd v BBC Chartering Carriers GmbH & Co KG [2024] HCA 4. The case has ramifications on whether a foreign arbitration clause (in this case, the London arbitration clause) would be null and void under the scheme of the Carriage of Goods by Sea Act 1991 (Cth) which makes effective an amended version of the International Convention on the Unification of Certain Rules of Law relating to Bills of Lading, Brussels, 25 August 1924 (the “Hague Rules”). The argument focused on the potential effect of Article 3(8) of the Amended Hague Rules, which, like the original version, provides:

“Any clause, covenant, or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to, or in connection with, goods arising from negligent, fault, or failure in the duties and obligations provided in this article or lessening such liability otherwise than as provided in these Rules, shall be null and void and of no effect. A benefit of insurance in favour of the carrier or similar clause shall be deemed to be a clause relieving the carrier from liability”.

BRIEF FACTS OF THE CASE

The case involved a carriage of head-hardened steel rails from Port of Whyalla in South Australia to the Port of Mackay in Queensland. When the goods arrived at the Port of Mackay, it was discovered that goods were in damaged conditions to the extent that they could not be used, and they had to be sold for scrap. A bill of lading issued by the carrier, BBC, containing the following clauses:

“3. Liability under the Contract

• Unless otherwise provided herein, the Hague Rules contained in the International Convention for the Unification of Certain Rules Relating to Bills of Lading, dated Brussels the 25th August 1924 as enacted in the country of shipment shall apply to this Contract. When no such enactment is in force in the country of shipment, the corresponding legislation of the country of destination shall apply. In respect of shipments to which there are no such enactments compulsorily applicable, the terms of Articles I-VIII inclusive of said Convention shall apply….”

4. Law and Jurisdiction

Except as provided elsewhere herein, any dispute arising under or in connection with this Bill of Lading shall be referred to arbitration in London. The arbitration shall be conducted in accordance with the London Maritime Arbitrators Association (LMAA) terms. The arbitration Tribunal is to consist of three arbitrators, one arbitrator to be appointed by each party and the two so appointed to appoint a third arbitrator. English law is to apply”.

The carrier, BBC, commenced arbitration in London according to Clause 4 of the bill of lading. Carmichael, on the other hand, commenced proceeding before the Federal Court of Australia to claim damages. Carmichael sought an anti-suit injunction to restrain the arbitration proceeding. BBC, on the other hand, sought a stay of the Australian proceeding.

ARGUMENTS IN THE HIGH COURT OF AUSTRALIA

Carmichael contended that Clause 4 should be null and void because of Article 3(8) of the Amended Hague Rules. First, there is a risk that London arbitrators will follow the position of the English law in Jindal Iron and Steel Co Ltd and Others v Islamic Solidarity Shipping Co. Jordan Inc (The “Jordan II”) [2004] UKHL 49 and found the carrier’s duty to properly stow and care for the cargo under Article 3(2) of the Hague Rules to be a delegable duty, as opposed to an inclination of the court in Australia, as shown in the New South Wales Court of Appeal decision in Nikolay Malakhov Shipping Co Ltd v SEAS Sapfor Ltd (1998) 44 NSWLR 371. Secondly, there is a risk that the London arbitrators would construe Clause 3 as incorporating Article I-III of the Hague Rules, instead of the Amended Hague Rules of Australia. This would result in reducing the package limitation defence. Thirdly, there would be more expenses and burdens on the part of Carmichael to have to pursue its claim against BBC in London.

REASONING OF THE HIGH COURT OF AUSTRALIA

Whether Article 3(8) is applicable, the High Court of Australia found as a matter of principle that the court must consider all circumstances (being past, present, or future) whether a contractual clause relieves or lessen the carrier’s liability. The standard of proof to be applied in considering such circumstances is the civil standard of the balance of probability. The court drew support from section 7(2) and section 7(5) of the International Arbitration Act 1974 (Cth), as the parties relied on this piece of legislation in seeking an anti-suit injunction or a stay of the proceeding. In section 7(2), the language is that the court “shall” stay the proceedings if a matter is capable of settlement by arbitration. In section 7(5), again, there is a word “shall” in that the court shall not stay the proceedings under subsection (2) if the court finds the arbitration agreement to be null and void. As the High Court of Australia emphasised in paragraph 25 of its judgment: “For an Australian court to ‘find’ an arbitration agreement null and void … it must be able to do so as a matter of law based on agreed, admitted, or proved fact”. Such proof is on the balance of probabilities pursuant to the Evidence Act 1995 (Cth). Moreover, the Amended Hague Rules in Australia ultimately has the nature of an international convention. The interpretation of which must be done within the framework of the Vienna Convention on the Law of Treaties 1969 which requires that relevant rules of international law must be considered. The burden of proof which international tribunals usually adopt is that of “preponderance of evidence”, which is no less stringent than that of the balance of probabilities. This supports what the High Court of Australia found in paragraph 32 of its judgment that “references to a clause ‘relieving’ a carrier from liability or ‘lessening such liability’ are to be understood as referring to facts able to be found in accordance with the requisite degree of confidence…” Also, the High Court of Australia found the overall purpose of the Hague Rules is to provide a set of rules which are certain and predictable. Any attempt to apply Article 3(8) to the circumstances or facts which are not agreed or admitted or proved would run against the overall objective of the Hague Rules.

A reference was also made to an undertaking made by BBC before the Full Court of the Federal Court of Australia that it would admit in the arbitration in London that the Amended Hague Rules would be applicable to the dispute and BBC did consent to the Full Court of the Federal Court of Australia to make declaration to the same effect. It was argued by Carmichael that the undertaking and the subsequent declaration should not be considered because they came after BBC had commenced the arbitration pursuant to Clause 4. However, the High Court of Australia, emphasised in paragraph 59 that the agreed or admitted or proved facts at the time the court is deciding whether to engage Article 3(8) are what the courts consider. The effect of the undertaking and the declaration are that it should be amounted to the choice of law chosen by the parties within the meaning of section 46(1)(a) of the Arbitration Act 1996 and should effectively supersede the choice of the English law in Clause 4 of the bills of lading.

All the risks pointed out by Carmichael are unreal. First, the indication of the New South Wales Court of Appeal in the Nikolay Malakhov case in respect of Article 3(2) of the Hague Rules was not conclusive as it was obiter only. There is no clear legal position on this in Australia. Secondly, the language of Clause 3 is that Article I-VIII are to be applied if there are “no such enactments”. But the country of shipment in this case (namely Australia) enacts the Hague-Rules. Moreover, there is no ground for any concern in light of the undertaking and the declaration. Lastly, Article 3(8) of the Amended Hague Rules concerns with the carrier’s liability. It is not about the costs or burdens in the enforcement process. Hence, the Australian proceeding is to be stayed.

COMMENT

As the High Court of Australia emphasised, whether Article 3(8) of the Amended Hague Rules is to be engaged depending upon facts or circumstances at the time the court is deciding the question. This case was pretty much confined to its facts, as could be seen from the earlier undertaking and the declaration which the High Court of Australia heavily relied upon. Nevertheless, the door is not fully closed. There is a possibility that the foreign arbitration and the choice of law clause can be found to be null and void pursuant to Article 3(8) if the facts or circumstances are established on the balance of probabilities that the tribunals will apply the foreign law which has the effect of relieving or lessening the carrier’s liabilities.

La rédaction de Dalloz actualité fait une petite pause hivernale.

Nous serons de retour dès le mardi 27 février 2024.

Merci de votre fidélité.

en lire plus

Alors que le projet de règlement sur l’intelligence artificielle connaissait une avancée importante, avec un accord du Parlement et du Conseil de l’Union sur cette « législation sur l’IA », telle que proposée par la Commission en avril 2021 (COM [2021] 206 final), amendée par le Parlement, le 9 décembre 2023, une nouvelle plainte contre les acteurs essentiels de l’IA générative que sont OpenAI et Microsoft saisissait les juges américains pour contrefaçon massive des droits d’auteur du New York Times. C’est à l’aune des dispositions du règlement, tel que « validé » par les vingt-sept États membres (version de la présidence belge du 26 janv. 2024), après des mois d’opposition française et allemande, il y a quelques jours, le 2 février dernier, que nous revenons sur cette plainte américaine.

Soutenant notamment que « l’apprentissage » des modèles GPT implique des reproductions non autorisées de plusieurs milliers d’œuvres protégées, et que les « productions » de l’IA générative constituent parfois des reproductions à l’identique des articles du New York Times ou des œuvres dérivées, alors que des licences pouvaient être obtenues, le New York Times sollicite des dommages et intérêts et une injonction interdisant la poursuite de la contrefaçon à grande échelle par OpenAI et Microsoft.

en lire plus

Eu égard aussi à la marge d’appréciation élargie dont disposait la France, s’agissant de propos ne se rattachant pas à un débat d’intérêt général, la condamnation du requérant pour avoir diffusé l’identité d’une victime d’agression sexuelle constituait une ingérence proportionnée au but légitime poursuivi.

en lire plus

L’on connaît désormais le premier grand sujet concernant la France, traité par la Cour européenne de droits de l’homme en 2024 : la protection de la liberté d’expression dans le cadre de la dénonciation de faits de harcèlement et d’agression sexuelle de la part de l’employeur. 

en lire plus

In Various parties obo minors v Anglo-American South Africa Limited and Others (2020/32777) [2023] ZAGPJHC 1474, the High Court of South Africa has refused to certify two class actions against Anglo American South Africa Limited (‘Anglo’). The proposed class action seeks monetary compensation for two classes from the Kabwe district in Zambia, who have been injured by lead exposure: children and women of childbearing age.

Kabwe is the capital of the Zambian Central Province and home to 225 000 people. Members of the proposed classes are estimated to make up approximately 140 000 members of this population. Kabwe is one of the most lead-polluted locations on the planet.

If forum non conveniens is now a classic hurdle for these kinds of cases in England and Wales (watch this space however for Lugano developments), then class certification presents itself in this judgment as a hurdle to an issue that in my view certainly should go to trial.

Windell J sets the scene [12]: (all footnotes in the quotes from the judgment have been omitted)

The application is unique. The applicants, who are citizens of Zambia and peregrini of this court (i.e, people neither domiciled nor resident in South Africa), are seeking redress in a South African Court, for a wrong committed in Zambia. They seek to hold Anglo liable for lead pollution that occurred during its involvement in the Mine from 1925 to 1974, beginning and ending 97 and 47 years ago respectively (the relevant period). The applicants’ cause of action is based on the tort of negligence. The parties agree that Zambian law will govern the substantive issues (the lex causae) and procedural matters will be governed by South African Law — the lex fori (the domestic law of the country in which proceedings are instituted).

[13] the main points of enquiry under Zambian law are laid out (and agreed)

The Zambian law mirrors the relevant English common law principles, which is part of Zambian law by virtue of section 2(a) of the English Law (Extent of Application) (Amendment Act 2011, Chapter 11). This means that English common law principles form part of Zambian law and are binding on Zambian courts, whereas the decisions of English courts are highly persuasive, even though not absolutely binding. Mr Musa Mwenye SC, the former Attorney General of Zambia, and the applicants’ Zambian law expert, opines that in deserving cases, Zambian courts may depart from English decisions if there are good and compelling reasons to do so but will not depart from established principles. The elements of the tort of negligence are therefore well-established. The Zambian Supreme Court has held that it requires proof of a duty of care; a breach of that duty through negligent conduct; actionable harm; a causal connection between the negligent conduct and the harm, involving both factual and legal causation; and damages.

[15] the criteria for the class action enquiry under South African law are listed:

In determining whether a class action is the appropriate procedural vehicle for the claims, the overarching requirement is the interest of justice (See Mukkadam v Pioneer Foods (Pty) Ltd. In Trustees for the time being of Children’s Resource Centre Trust and Others v Pioneer Foods (Pty) Ltd and Others (CRC Trust) the Supreme Court of Appeal (SCA) identified certain factors to be considered. First, there is a class or classes which are identifiable by objective criteria; Second, a cause of action raising a triable issue; Third, the right to relief depends upon the determination of issues of fact, or law, or both, common to all members of the class; Fourth, the relief sought, or damages claimed, must flow from the cause of action and be determinable and ascertainable; Fifth, if the claim is for damages, there is a suitable procedure for allocating the damages to members of the class; Sixth, the proposed representatives of the classes are suitable to be permitted to conduct the action and represent the class; Seventh, a class action is the most appropriate means of determining the claims of class members, given the composition of the class and the nature of the proposed action.

[19] the conclusion is summarised:

Anglo opposes the application on various grounds. Some of the grounds are valid, while others are not. Hence, I will commence with the three issues that do not pose an insurmountable obstacle to the certification of the class action. They are:  Suitability of the class representatives; Commonality and the Funding Agreements. Following that, I will then determine whether there is a cause of action raising a triable issue, which aspect, in my view, is fatal to the application. Finally, I shall discuss ‘Anglo’s alternative case’ which includes the damages claims, the suitability of an opt-out procedure and the class definitions.

In this blog post, in line with the blog’s general interests (here: the business and human rights angle), I will focus on the ‘triable issue’ analysis seeing as it engages with quite a few cases previously reported on the blog.

I do however also want to draw readers’ attention to the discussion [44] ff of the funding arrangements in light of my research grant (and also here) (research now conducted by Charlotte de Meeûs), with as conclusion

[81] As remarked in the interlocutory application, this court, ‘as the guardian of the child’s best interests, has a heightened duty to scrutinise the funding arrangements. Because the purported claims of thousands of Zambian children may be rendered res judicata by an action in a foreign jurisdiction, it is the duty of the court to ensure that these claims are adequately pursued by way of funding arrangements that are not only sufficient, but that do not deliver extortionate profits for third party funders at the cost of the children and that insulates the classes and their lawyers from undue influence from Kabwe Finance.

[82] Anglo’s concerns are without merit because the necessary safeguards developed by our class action jurisprudence have been built into the proposed funding arrangements. First, the applicants have provided detailed disclosure of the funding arrangements, which is without a doubt among the most detailed and transparent disclosures of any class certification proceeding to date. Second, the terms of the relevant funding agreements are explicit that neither the funder nor LD will exercise control over the case, which is to be conducted by MM on the instructions of the class representatives. Third, the applicants are represented by experienced attorneys and independent advocates who are bound by ethical rules to represent the interests of their clients.

[83] Fourth, the funder is part of the Augusta Group, a leading third-party litigation funder with a well-established track record and reputation. That reputation creates its own safeguard. Abuses and underhanded dealings, of the kind that Anglo alleges, would be disastrous to its professional standing and credibility with the courts. Fifth, the funder is bound by the Association of Litigation Funders’ Code (ALF), which explicitly prohibits funder control of litigation and other abuses. AVL is a member of the ALF and the Code’s requirements have been explicitly incorporated in the Claim Funding Agreement, thereby making them contractually binding on the funder.

[84]       Anglo’s attempt to characterise the Code as inadequate protection ignores the history and significance of the Code, as well as the weight it has been given by courts in England and Wales. The significance of the Code was recently explained in Akhmedova:….

[85]       Sixth, the applicants are protected by the provisions of the CFA, particularly s 5 which gives them the right to seek the review of any terms of the contingency fee agreement and the fees. Seventh, in response to Anglo’s repeated claims that the settlement will be hijacked by funders and lawyers to the detriment of the class, applicants and prospective class members are afforded two critical layers of protection: If the class representatives object to any settlement proposal, they may refer a dispute to an independent senior counsel, in terms of the dispute resolution mechanisms in the Claim Funding Agreement. And the applicants and class members are further protected by the court, as the parties would have to seek judicial approval of any settlement, in terms of the procedures approved in the Nkala settlement judgment

On the applicants’ case for there being a ‘triable issue’, [86] ff

applicants seek redress in a South African court on the basis that Anglo was the parent company and head office of the Anglo group that oversaw, managed and/or advised the Mine from its headquarters in Johannesburg, within the jurisdiction of this court, during the relevant period. It is asserted that Anglo exercised control over the Mine through an ever-changing set of subsidiaries, and although its organisational structure is quite complex, the Mine was firmly a part of Anglo’s ‘group system’….

applicants contend that the question of whether and when a multinational parent company owes a duty of care in respect of the actions of a foreign subsidiary is well-settled in English law, and they are confident that there is sufficient evidence to prove that Anglo owed a duty of care to the members of the classes.

Applicants refer ia to Vedanta and Okpabi.

[89] even Anglo’s expert on English law is of the opinion that ‘an English court would likely determine that the duty of care alleged in the draft POC together with its supporting affidavit raises a real issue to be tried’. He further stated that ‘[I]t will be a question of fact and degree whether or not the evidence adduced demonstrates a sufficient level of knowledge, control, supervision and intervention for the purposes of attaching legal responsibility.’

[90] ff the case for the applicants is further explained: that over the course of its almost 50-year involvement in the Mine’s affairs, Anglo negligently breached its duty of care by, inter alia, failing to conduct the necessary investigations on the impact of lead pollution on the surrounding communities by taking common sense measures, such as long-term sampling of air, water, soil and vegetation and monitoring the health impacts on the local communities in Kabwe [91]; Anglo’s negligence therefore caused or materially contributed to the existing levels of lead pollution in Kabwe and the resulting actionable harm. It is alleged that Anglo acted negligently in at least five material respects: it failed to investigate; it failed to protect; it failed to cease and relocate; it failed to remediate; and it failed to warn [92].

The judge however sides with Anglo’s arguments, outlined [98] ff. In effect Anglo lays all blame with ZCCM, ‘the obvious culprit’ [100], a Zambian state-owned entity and its predecessors in title who it is said at all times from 1905 to 1994 owned and operated the Mine.

Anglo also refer to the Zambia state-controlled Nchanga Consolidated Copper Mines Ltd (NCCM), established January 1970. It argues [105] that following the closure of the Mine in 1994, and in accordance with Zambian legislation enacted in 2000, ZCCM retained all historical liabilities associated with the Mine. It held the legal responsibility to address the environmental and health impacts on Kabwe residents and became responsible for the remediation and rehabilitation of the Mine. In the 2000s, the World Bank and the Zambian government attempted on multiple occasions to assist ZCCM in remediating the Mine’s surroundings. These efforts it is said are ongoing, but they have been largely unsuccessful to date.

[106] Anglo argue that ZCCM’s negligence and omissions is an unforeseeable intervening event (novus actus interveniens), that absolves Anglo of all liability.

The test at certification stage is “not a difficult hurdle to cross” ([113], with reference to authority) yet Windell J concludes the case is both factually and legally hopeless.

“Factually hopeless” 

[117] ff the judge takes issue with applicants’ so-called ‘Broken Hill attitude’ in support of their argument against Anglo. In doing she, she focuses it seems on the much troubled history of Broken Hill, NSW. Australian readers and students of mine sadly will be very familiar with that name and with the 1893 report.

In essence, the judge dismisses relevance of the 1893 Report [120] referring to the unlikelihood, in her view, of Anglo’s knowledge of the report:

Anglo was only established in 1917. There is not any evidence that the Report came to the attention of Anglo at any point (including between 1925 and 1974). The applicants do not explain how an entity, established 24 years after the Report was published, located in a different country and on a different continent, and in an age of basic forms of communication technology, came to know of this Report. In these circumstances, it cannot be suggested that Anglo had knowledge of the harms set out in the Report.

And [121] the judge refers to alleged levels of nuance in the report.

Applicants’ suggestion [119] that Anglo knowing of the issues will be further established following discovery and further research is not further entertained. That would seem an extraordinary lack of engagement with the evidence. All the more so as it would seem that applicants’ reference to a ‘Broken Hill attitude’, which the judge dismisses, is not their shorthand for a particular safety attitude linked to the NSW mine and the 1890s reporting. Rather a reference to an internal Anglo document commissioned in the 1970s with the very title ‘Broken Hill attitude’, that is: Broken Hill, Kabwe. The ‘attitude’ of lack of regard, and of neglect, is one that is signalled in an internal Anglo document, not catch phrased by applicants.

Anglo’s novus actus interveniens argument referred to above, prima facie sits uneasy with the material contribution element of the law of causation and simply cannot be dealt with at this interlocutory stage.

The judge moreover arguably overlooks applicants ‘modicum of common sense’ [119]. It is, with respect, absurd to suggest there is no prima facie proof of Anglo’s historic knowledge of the harm of lead and more specifically knowledge of harm to the historical Kabwe community. Knowledge of the “adit to alloy” so to speak harm associated with all aspects of lead is historically exceedingly well established. Anglo’s approach to it at a mine in which it was clearly involved for a long period, cannot be readily dealt with at certification stage.

The judge concludes [128] that before the early 1970s, there is no evidence to imply that Anglo was specifically aware of the risks that lead pollution posed to the historical Kabwe community.

The contentions and counterarguments about what ought to have taken place from an engineering point of view to mitigate the risk, in my view are to be discussed at trial, not at certification stage, and the judge’s suggestions [134] ff that at trial applicants would not fair better would seem to exceed the prima facie level required at certification stage (as well as sitting uneasily with the Supreme Court finding in Okpabi).

“Legally hopeless”

[145] ff the applicants’ legal arguments, too, are held not to be sufficient in most succinct manner. In essence, the judge dismisses the relevance of ‘current’ authorities such as Vedanta etc. She distinguishes it as follows [148]

to establish that Anglo owed a duty of care 50 years and more ago to the proposed class members currently living in the Kabwe district, this court must be satisfied that there is prima facie evidence to find that between almost 100 and nearly 50 years ago, Anglo must have foreseen that the current community, not the historical community, would suffer harm from lead released into the environment by the Mine during the relevant period.

Relevant authority in the judge’s view is rather Cambridge Water [1994] 2 A.C. 264.

One imagines English tort lawyers will have a lot to say on the most concise (8 paras) discussion of the common law duty of care authority, that leads the judge to her finding that the case is legally untenable.

I understand permission to appeal is being sought, as it should.

Geert.

The judgment denying class certification in claim against Anglo American on behalf of Zambian claimants re lead pollution in Kabwe, Zambia is now here https://t.co/N9m9HEZZih

Appeal likely

Held [117] ff case is factually and legally flawed
More on the blog soon (eg re funding) pic.twitter.com/tF9kojek7A

— Geert Van Calster (@GAVClaw) January 31, 2024

Pursuant to Article 9 of the Rome II Regulation on the law applicable to non-contractual obligations, the law applicable to an industrial action is the law of the country where the action has been taken.

In a judgment of 5 February 2024, the Norwegian Labour Court relied on the  conflict-of-law rule enshrined in the above provision in a case concerning an industrial action taken by employees conducting work for the Norwegian oil drilling industry on the Norwegian continental shelf on international waters in the North Sea. Relying on Norwegian law instead of UK law, the Norwegian Labour Court held that the industrial action had been lawful.

At the very centre of the North Sea, close to where the continental shelves of the UK, Norway, Denmark, Germany and the Netherlands almost intersect, a collective labour dispute arose regarding the employment conditions for oil workers. The concerned oil workers, all UK citizens living in the UK, were employed by a UK company to conduct well stimulation for an oil drilling platform located at the Ekofisk field on the Norwegian continental shelf from a Norwegian-registered ship operating out of Esbjerg, Denmark. When collective agreement negotiations between the UK company and the Norwegian trade union – in which the employees are members – broke down in 2023, the trade union called a strike.

To support the Norwegian trade union’s claim for a collective agreement, the Norwegian Confederation of Trade Unions (Landsorganisasjonen i Norge) called a sympathy action. In collective labour law, sympathy actions are taken to support fellow organizations, but may also be directed at a collective agreement party. It must here be noted that taking industrial actions toward a collective agreement party is an exception to the normally very strong peace obligation that follows a collective agreement. In the case at hand, the dispute was regarding whether sympathy actions were allowed under the collective agreement. Under the collective agreement, a sympathy action is allowed if it ‘supports a legal industrial action in Norway’. Hence, the task for the Norwegian Labour Court was to interpret whether the industrial action taken in the North Sea was to be considered a legal industrial action in Norway under the collective agreement.

To interpret if the industrial action took place in Norway, the Norwegian Labour Court first held that the localization in the sense of the collective agreement was dependent on the industrial action’s connections to Norway. Here, the Labour Court found that the connecting factors relating to the employment conditions should be given priority. Decisive connecting factors were noted to be both that work was conducted only on the Norwegian continental shelf and that the employees claimed a Norwegian collective agreement.

The next issue for the Labour Court was whether the industrial action was ‘lawful’ in Norway. Here, the private international choice of law rules played a crucial role for the court’s argumentation. In Norway, which is not an EU member state, the EU choice of law regulations are not applicable. However, Norway’s close cooperation with the EU justifies the strong presumption set out by the Norwegian Supreme Court stating that Norwegian choice of law rules shall be consistent with EU choice of law rules unless Norwegian rules clearly deviate from the EU choice of law rules. First, the Norwegian Labour Court noted that collective agreement parties enjoy party autonomy, both under uncodified Norwegian private international law and under the Rome I Regulation on the law applicable to contractual obligations. Consequently, it would have been possible for the collective agreement parties to choose the law that would govern the legality of industrial actions for which sympathy actions are allowed. However, the collective agreement clause’s expression ‘in Norway’, was – in the view of the parties – not a choice of law clause but a referral to Norwegian choice of law rules.

The implicit contractual reference to Norwegian choice of law rules caused the Labour Court to take a preliminary stance on the law applicable to the primary industrial action. This choice of law issue is uncodified in Norwegian private international law, which has historically relied on an individualizing method to point out the applicable law. However, as was mentioned above, modern Norwegian private international law is strongly influenced by EU private international law. Therefore, the Norwegian Labour Court also in this matter consulted the EU conflict-of-law rule for industrial actions in Article 9 of the Rome II Regulation to establish the law applicable to the industrial action.

Article 9 of the Rome II Regulation prescribes that the law applicable to an industrial action shall be the law of the country where the industrial action is taken (lex loci delicti). This is an exception to the general rule in Article 4 that points out the law in the country where the damages occurs as applicable (lex loci damni). According to Recital 27, the reason for the industrial action exception is to protect employees’ and employers’ rights. Noting this, the Labour Court dealt with the delicate issue of localizing the industrial action that was taken at international sea. Here, the Labour Court noted that the industrial action in question was a strike. Holding that a strike under Article 9 of the Rome II Regulation must be located to the place where the work would have been conducted, the Norwegian Labour Court concluded that Norwegian law was applicable.

As an obiter dictum, the court further stated that also if article 9 had not been applicable due to the fact that the industrial actions were taken at international sea, the alternative solutions would give the same conclusion. Under Article 4(3) of the Rome II Regulation, the law of a country to which the tort ‘is manifestly more closely connected’ shall be applied. Applying the escape rule to the facts of the case, the Labour Court held that the industrial action was manifestly more closely connected to Norway than to the UK. Lastly, the Labour Court held that it would make no difference for the conclusion if the connecting factors were weighed under Article 4(3) of the Rome I Regulation or under the Norwegian individualizing method. Norwegian law would apply in either case.

As the primary industrial action was lawful under Norwegian law, the sympathy action was allowed.

Article 9 of the Rome II Regulation has never been applied by the Court of Justice. National case law is also scarce. In legal literature, different interpretations of Article 9 have been suggested. The above factors have resulted in a situation of uncertainty regarding the this provision. For a party that intends to take industrial action in an international context, this unclarity is detrimental. If the applicable law is not foreseeable, it is hard to predict whether an industrial action would be lawful. Therefore, the Norwegian judgment is important, as it stresses the role of the law applicable to an industrial action for the regulation of collective agreements in a certain labour market.

In the Lafarge case (Cass. Crim., 16 janvier 2024, n°22-83.681, available here), the French Cour de cassation (chambre criminelle) recently rendered a ruling on some criminal charges against the French major cement manufacturer for its activities in Syria during the civil war. The decision addresses several key aspects of private international law in transnational criminal lawsuits and labour law.

From 2012 to September 2014, through a local subsidiary it indirectly controlled, the French company kept a cement plant operating in a Syrian territory exposed to the civil war. During the operation, the local employees were at risk of extortion and kidnapping by armed groups, notably the Islamic State. On these facts, in 2016, two French NGOs and 11 former Syrian employees of Lafarge’s Syrian subsidiary pressed criminal charges in French courts against the French mother company. Charges contend financing a terrorist group, complicity in war crimes and crimes against humanity, abusive exploitation of the labour of others as well as endangering the lives of others.

After lengthy procedural contortions, the chambre d’instruction of the Cour d’appel de Paris (the investigating judge) confirmed the indictments in a ruling dated May 18th, 2022.  Here, the part of the decision of most direct relevance to private international law concerns the last incrimination of endangering the lives of others. The charge, set out in Article 223-1 of the French Criminal Code, implicates the act of directly exposing another person to an immediate risk of death or injury likely to result in permanent mutilation or infirmity through the manifestly deliberate violation of a particular obligation of prudence or safety imposed by law or regulation. The chambre d’instruction found that the relationship between Lafarge and the Syrian workers was subject to French law, which integrates the obligations of establishing a single risk assessment report for workers’ health and safety (Articles R4121-1 and R4121-2 of the French Labour Code) and a mandatory safety training related to working conditions (Article R4141-13 of the French Labour Code). On this basis, it upheld the mother company’s indictment for violating the aforementioned prudence and safety obligations of the French Labour Code. Following this ruling, the Defendants petitioned to the French Supreme Court to have the charges annulled, arguing that French law did not apply to the litigious employment relationship.

By its decision of January 16, 2024, the French Cour de cassation (chambre criminelle) ruled partly in favour of the petitioner. By applying Article 8 of the Rome I regulation, it decided that the employment relationship between Lafarge and the Syrian workers was governed by Syrian law, so that, French law not being applicable, the conditions for application of Article 223-1 of the French Criminal Code were not met. Thus, the Cour de cassation quashed Lafarge’s indictment for endangering the lives of others, while upholding the remaining charges of complicity in war crimes and crimes against humanity.

The Lafarge case highlights the stakes of transnational criminal law and its interplay with private international law.

Because of the solidarity between criminal jurisdiction and legislative competence, the field is in principle exclusive of conflict of laws. However, this clear-cut frontier is often blurred.

In Lafarge, a conflict appeared incidentally via the specific incrimination of endangering the lives of others. In a transnational context, the key legal issue concerns the scope of the legal and regulatory obligations covered by the incrimination. A flexible interpretation including foreign law would lead to a (too) broad extension of French courts’ criminal jurisdiction. In the present decision, the Cour de cassation logically ruled, notably on the basis of the principle of strict interpretation of criminal law, that an obligation of prudence or safety within the meaning of Article 223-1 “necessarily refers to provisions of French law”.

Far from exhausting issues of private international law, this conclusion opens the door wide to conflict of laws. Indeed, the court then had to determine whether such French prudence or safety provisions applied to the case.

Under Article 8§2 of the Rome I regulation, absent an employment contract, the law applicable to the employment relationship between Lafarge and the Syrian workers should be the law of the country in which the employees habitually carry out their work –i.e. Syrian law. However, French law could be applicable in two situations: either if it appears that the employment relationships have a closer connection with France (article 8§4 Rome I), or because French law imposes overriding mandatory provisions (article 9 Rome I).

On the one hand, the Cour de cassation dismissed the argument that the employment relationship had a closer connection with France. Previously, the chambre d’instruction considered that the parent company’s permanent interference (“immixtion”) in the management of its Syrian subsidiary (based on a body of corroborating evidence, in particular, the subsidiary’s financial and operational dependence on the parent company, from which it was deduced that the latter was responsible for the plant’s safety) resulted in a closer connection between France and the employment contracts of the Syrian employees. Referring to the ECJ case law, which requires such connection to be assessed on the basis of the circumstances “as a whole”, the Supreme Court conversely held that considerations relating solely to the relationship between the parent company and its subsidiary were not sufficient to rule out the application of Syrian law. Ultimately, the Cour de cassation found that none of the alleged facts was such as to characterize closer links with France than with Syria.

On the other hand, the Cour de cassation rejected the characterization of Articles R4121-1, R4121-2 and R4141-13 of the French Labour Code as overriding mandatory provisions (“lois de police”). Here, the Criminal division of the Cour is adopting the solution set out by the Labour disputes division (chambre sociale) in an opinion issued on the present Lafarge case. In its opinion, the Social division noted that, while the above-mentioned provisions do indeed pursue a public interest objective of protecting the health and safety of workers, the conflict of laws rules set out in Article 8 Rome I are sufficient to ensure that the protection guaranteed by these provisions applies to workers whose contracts have enough connection with France -a questionable utterance in the light of the reasoning of the Cour de cassation in the decision under comment and its strict interpretation of the escape clause.

As a result, the employment relationship between Lafarge and the Syrian workers was governed by Syrian law, with French law not imposing any obligation of prudence or safety to the case. The Supreme court thereby concluded that the conditions for application of Article 223-1 of the French Criminal Code were not met.

The Lafarge decision will have broad implications for transnational litigations.

Firstly, the Cour de cassation confirms the strict interpretation of the escape clause in Article 8§4 of the Rome I regulation. Making extensive reference to the ECJ case law, the Court recalled that when applying Article 8§4, courts must take account of all the elements which define the employment relationship and single out one or more as being, in its view, the most significant (among them: the country in which the employee pays taxes on the income from his activity; the country in which he is covered by a social security scheme and pension, sickness insurance and invalidity schemes; as well as the parameters relating to salary determination and other working conditions).

More importantly, the French Supreme Court limits the consequences of parent companies’ interference (immixtion) in international labour relations and value chain governance. The criterion of interference is commonly used to try to lift the corporate veil for imputing obligations and liability directly to a parent company. By establishing that the parent company’s interference was insufficient to characterize the existence of a closer connection with France, the Cour de cassation circumscribes the spatial scope of French labour law and maintains the territorial compartmentalization of global value chains. It is regrettable, in that respect, that the Supreme court did not precisely discuss the nature of the relationship between Lafarge and the Syrian workers. This solution is nevertheless consistent with the similarly restrictive approach to co-employment adopted by the French courts, which requires a “permanent interference” by the parent company leading to a “total loss of autonomy of action” on the part of the subsidiary. Coincidentally, in the absence of overriding mandatory provisions, the ruling empties of all effectiveness similar transnational criminal actions based on Article 223-1 of the French Criminal Code.

While the Cour de cassation closed the door of criminal courts, French law on corporate duty of care (Loi n° 2017-399 du 27 mars 2017 relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre) offers an effective alternative in the field of civil liability. The aim of this text is precisely to impose on lead companies a series of obligations purported to identify risks and prevent serious violations of human rights and fundamental freedoms, human health and safety, and the environment, throughout the value chain. The facts of the Lafarge case are prior to the enactment of this law. Nevertheless, future litigations will likely prosper on this ground, all the more so with the forthcoming adoption of a European directive on mandatory corporate sustainability due diligence.

By Professor András Osztovits*

I. Introduction

The heart of European economic integration is the Single Market, which can only function properly and provide economic growth and thus social welfare if effective competition rules ensure a level playing field for market players. The real breakthrough in the development of EU competition policy in this area came with Regulation 1/2003/EC, and then with Directive 2014/104/EU which complemented the public law rules with private law instruments and made the possibility to bring actions for damages for infringement of competition law easier.

It is not an exaggeration to say that the CJEU has consistently sought in its case-law to make this private enforcement as effective as possible, overcoming the procedural and substantive problems that hinder it. It was the CJEU which, in the course of its case law, developed the concept of the economic unit, allowing victims to bring an action against the whole of the undertaking affected by the cartel infringement or against certain of its subsidiaries or to seek their joint liability.

The concept of an economic unit is generally understood to mean that a parent company and its subsidiary form an economic unit where the latter is essentially under the dominant influence of the former. The CJEU has reached the conclusion in its case law that an infringement of competition law entails the joint and several liability of the economic unit as a whole, which means that one member can be held liable for the acts of another member.

II. The question referred by the Hungarian Supreme Court

However, there is still no clear guidance from the CJEU as to whether the principle of economic unit can be interpreted and applied in the reverse case, i.e. whether a parent company can rely on this concept in order to establish the jurisdiction of the courts where it has its registered seat to hear and determine its claim for damages for the harm suffered by its subsidiaries. This was the question raised by the Hungarian Supreme Court (Kúria) in a preliminary ruling procedure, in which this issue was raised as a question of jurisdiction. More precisely Article 7 (2) of the Brussels Ia Regulation had to be interpreted, according to which a person domiciled in a Member State may be sued in another Member State, ‘in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur’.

The facts of the case were well suitable for framing and answering this question. The applicant is a company established in Hungary. It is either the majority shareholder or holds another form of exclusive controlling power over a number of companies established in other EU Member States. During the infringement period identified by the Commission in its decision of 19 July 2016, those subsidiaries purchased indirectly, either as owners or under a financial leasing arrangement, 71 trucks from the defendant in several Member States.

The applicant requested, before the Hungarian first-instance court, that the defendant be ordered to pay EUR 530 851 with interest and costs, arguing that this was the amount that its subsidiaries had overpaid as a consequence of the anticompetitive conduct established in the Commission Decision. Relying on the concept of an economic unit, it asserted the subsidiaries’ claims for damages against the defendant. For that purpose, it sought to establish the jurisdiction of the Hungarian courts based on Article 7(2) of Regulation No 1215/2012, claiming that its registered office, as the centre of the group’s economic and financial interests, was the place where the harmful event, within the meaning of that provision, had ultimately occurred. The defendant objected on the ground that the Hungarian courts lacked jurisdiction. The courts of first and second instance found that they lacked jurisdiction, but the Curia, which had been asked to review the case, had doubts about the interpretation of Article 7(2) of the Regulation and referred the case to the CJEU.

III. The Opinion of Advocate General

In his Opinion delivered on 8 February 2024, Advocate General Nicholas Emiliou concluded that the term ‘the place where the harmful event occurred’, within the meaning of Article 7(2) of Regulation No 1215/2012, does not cover the registered office of the parent company that brings an action for damages for the harm caused solely to that parent company’s subsidiaries by the anticompetitive conduct of a third party.

In his analysis, the Advocate General first examined the jurisdictional regime of the Brussels Ia Regulation, then the connecting factors in the context of actions for damages for infringements of Article 101 TFEU, and finally the question of whether the place of the parent company’s seat can be the place where the damage occurred in the case of damage suffered by a subsidiary. He recalled that, according to the relevant case-law of the CJEU, rules of jurisdiction other than the general rule must be interpreted restrictively, including Article 7. He pointed out that ‘the place where the harmful event occurred’ within the meaning of that provision does not cover the place where the assets of an indirect victim are affected. In the Dumez case, two French companies, having their registered offices in Paris (France), set up subsidiaries in Germany in order to pursue a property development project. However, German banks withdrew their financing, which lead to those subsidiaries becoming insolvent. The French parent companies sought to sue the German banks in Paris, arguing that this was the place where they experienced the resulting financial loss. According to the Advocate General, the applicant in the present action is also acting as an indirect victim, since it is seeking compensation for damage which first affected another legal person.

Recalling the connecting factors in actions for damages for infringement of Article 101 TFEU, the Advocate General pointed out that there were inconsistencies in the case law of the CJEU, which needed to be clarified in a forthcoming judgment. Both types of specific connecting factors (place of purchase and the victim’s registered seat) could justify the application of the rule of jurisdiction under Article 7(2) of the Regulation. The Advocate General referred to the Volvo judgment, where the CJEU qualified ‘the place where the damage occurred’ is the place, within the affected market, where the goods subject to the cartel were purchased. The Court has simultaneously reaffirmed, in the same judgment, the ongoing relevance of the alleged victim’s registered office, in cases where multiple purchases were made in different places. According to the Advocate General, the applicant seeks to extend the application of that connecting factor to establish jurisdiction in relation to its claim in which it seeks compensation for harm suffered solely by other members of its economic unit.

The Advocate General referred to the need for predictability in the determination of the forum in cartel proceedings, although he acknowledged that when it comes to determining the specific place ‘where the harm occurred’, the pursuit of the predictability of the forum becomes to some extent illusory in the context of a pan-European cartel.

In examining the Brussels Ia Regulation, the Advocate General recalled that it only provides additional protection for the interests of the weaker party in consumer, insurance and individual contracts of employment, but that cartel victims are not specifically mentioned in the Regulation, and therefore, in its interpretation, the interests of the claimants and defendants must be considered equivalent. Even so, the parent company has a wide range of options for claiming, the victim can initiate the action not only against the parent company that is the addressee of the respective Commission decision establishing an infringement but also against a subsidiary within that parent company’s economic unit. That creates the possibility of an additional forum and may therefore further facilitate enforcement. The victim also has the option of bringing proceedings before the court of the defendant’s domicile under the general rule of jurisdiction, which, while suffering the disadvantages of travel, allows him to claim the full damages in one proceeding. In these circumstences, the Advocate General failed to see in what way the current jurisdictional rules fundamentally prevent the alleged victims of anticompetitive conduct from asserting their rights.

IV. In the concept of economic unit we (don’t) trust?

Contrary to the Advocate General’s opinion, several difficulties can be seen which may prevent the victim parent companies from enforcing their rights if they cannot rely on Article 7(2) of the Brussels Ia Regulation. The additional costs arising from geographical distances and different national procedural systems may in themselves constitute a non-negligible handicap to the enforcement of rights, although this is true for both parties to the litigation. However, the aim must be to minimise the procedural and substantive obstacles to these types of litigation, whose economic and regulatory background makes them inherently more difficult and thus longer in time. It is also true that the real issue at stake in this case is the substantive law underlying the jurisdictional element: whether the parent company can claim in its own name for the damage caused to its subsidiaries on the basis of the principle of economic unit. If so, then Article 7(2) of the Brussels Ia Regulation applies and it can bring these claims in the court of its own registered office. Needless to say, having a single action for damages in several Member States is much better and more efficient from a procedural point of view, and is therefore an appropriate outcome from the point of view of EU competition policy and a more desirable outcome for the functioning of the Single Market. The opportunity is there for the CJEU to move forward and further improve the effectiveness of competition law, even if this means softening somewhat the relevant jurisprudence of the Brussels Ia Regulation, which has interpreted the special jurisdictional grounds more restrictive than the general jurisdiction rules. The EU legislator should also consider introducing a special rule of jurisdiction for cartel damages in the next revision of the Brussels Ia Regulation at the latest.

The fullt text of the opinion is available here (original language: English)

*Dr. András Osztovits, Professor at Károli Gáspár University, Budapest, Hungary, osztovits.andras@kre.hu.  He was member of the chamber of the Hungarian Supreme Court (Kúria) that initiated this preliminary procedure. Here, the author is presenting his own personal views only.