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Within the context of the service of documents Regulation (1393/2007) but with no less relevance for the Jurisdiction Regulation, the Court held last week on the qualification of an action by (German) holders of Greek bonds, against the Greek State, for the involuntary shave they took on those bonds. I reviewed Bot AG’s Opinion here. He had suggested that in the case at issue, the Greek State, with its retroactive insertion of the collective action clause in the underlying contract, exercised acta uire imperii with direct intervention in the contract itself. Not an abstract, general regime (such as a change in overall tax) which only has an impact on said contract at arm’s length.

The ECJ disagreed. Its finding may be distinguishable, in that it emphasises (at 40 and 44 in particular) that for the service of documents Regulation, things need to move fast indeed and hence interpretation even of core concepts of the Regulation needs to proceed swiftly: ‘in order to determine whether Regulation No 1393/2007 is applicable, it suffices that the court hearing the case concludes that it is not manifest that the action brought before it falls outside the scope definition of civil and commercial matters.‘ (at 49) However in the remainder of the judgment it does refer to precedent in particular under the Brussels I Regulation, hence presumably making current interpretation de rigueur for European civil procedure generally.

As noted in my earlier review, Bot AG opined that the Greek State’s intervention in the contracts was direct and not at a distance from the contract. The Court on the other hand essentially emphasised (at 57) that even though the Greek State, with its retroactive insertion of the collective action clause in the underlying contract, enabled the subsequent vote by the majority of the bondholders (to the dismay of the outvoted applicants), it was the vote, which led directly and immediately to changes to the financial conditions of the securities in question and therefore caused the damage alleged by the applicants – not the Act which enabled it. Not acta iure imperii therefore and hence European civil procedure is applicable.

I need to ponder this a bit further however at first sight the ‘direct and immediate’ effect test brings back soar memories of the ‘primarily aimed at’ test in WTO law, which took some time for the Appellate body to shake off. A bit of a leap, I know, but the trade lawyers among you will know what I mean. Applicants in the case at issue may be left arguing that identifying the Greek State’s intervention as the cause of the change in law, is no application of the butterfly effect (an extremely remote event which is being blamed for downstream effects) but rather an elephant in the Greek bond market room.

‘Direct and immediate effect’ may become an important consideration in the ECJ’s application of ‘civil and commercial’ in EU civil procedure law.

Geert.

Il Centro di Studi Giuridici Europei dell’Università di Urbino “Carlo Bo” organizza, in collaborazione con l’Istituto svizzero di diritto comparato, il 57ème Séminaire de Droit Comparé et Européen.

L’iniziativa, che si svolgerà tra il 17 e 29 agosto 2015 ad Urbino, vedrà succedersi lezioni e conferenze, oltre agli interventi di notai italiani e lussemburghesi.

Questo il programma delle lezioni: Marie-Elodie Ancel (Univ. Paris-Est Créteil, Paris XII), Œuvres des arts appliqués: emprise et limites du principe européen de nondiscrimination; Eleonora Ballarino (Foro di Milano),  Law and practice in International Contract Law: Case studies in Oil & Gas Contracts; Francesca Bologna (Foro di Venezia), La protection des données personnelles en France et en Italie à l’aune du droit européen; Robert Bray (Parlamento europeo), L’immunità parlamentare a livello europeo; Georges Cavalier (Univ. Jean Moulin, Lyon 3), Comparative and European taxation. Comparative tax incentives for research & Development (R&D); Tuto Rossi (Univ. Friburgo), Contratti complessi in diritto internazionale privato; Martin Svatoš (FORARB Arbitration), Les questions contemporaines dans le domaine de l’arbitrage international: L’interaction avec la médiation et autres MARC; Chris Tomale (Univ. Heidelberg), A la recherche d’une coordination des compétences universelles civiles entre l’Union européenne et les Etats tiers.

Le conferenze vedranno gli interventi di:  Alessandro Bondi (Univ. Urbino), Le droit pénal européen 2.0; Andrea Giussani (Univ. Urbino) La direttiva sulle azioni di risarcimento del danno antitrust; Luigi Mari (Univ. Urbino), Il diritto internazionale privato sammarinese; Alexander R. Markus (Univ. Berna), Le Règlement Bruxelles I bis et la Convention de Lugano; Paolo Morozzo della Rocca (Univ. Urbino), La filiazione tra bilanciamento dei diritti e ordine pubblico; Cyril Nourissat  (Univ. Jean Moulin, Lyon 3), Le 17 août 2015: une révolution pour les successions internationales?; Ilaria Pretelli (Ist. Svizzero di diritto comparato), Le misure provvisorie nella rifusione del regolamento Bruxelles I.

A chiudere il seminario sono previsti gli interventi, sul tema dell’attività notarile in Europa, dei notai Paolo Pasqualis (Fondazione Italiana del Notariato), Elisabetta Bergamini (Univ. Udine) e Corrado Malberti (Univ. Lussemburgo).

Le iscrizioni, aperte sino al 1° agosto 2015 dovranno essere inoltrate all’indirizzo email seminaire@uniurb.it inviando la domanda compilata e sottoscritta reperibile qui.

Maggiori informazioni sono disponibili a questo indirizzo. Il flyer dell’iniziativa è qui consultabile.

The summer Séminaire de Droit Comparé et Européen is a common venture of Italian and French jurists taking place in Urbino (Italy) since 1959 – this edition makes therefore the number 57. The underlying idea is to provide for a place and time for the gathering of jurists, mainly, but not only, from European countries, and thus contribute to the development of knowledge of Comparative,  International (both public and private) and European law.

This year’s seminar will be held in August, 17th to 29th, counting with speakers from various countries and institutions, among which Prof. M.E. Ancel, C. Nourissat, A. Giussani, A.R. Markus, L. Mari or I. Pretelli. Practitioners -lawyers, mediators, arbitrators and notaries- are also involved. Presentations may be in French, English or Italian; a summarized translation may be asked for.

The whole program as well as email addresses for further information is downloadable here.

Si svolgerà a Monaco di Baviera, il 23 giugno 2015, un incontro di studio dal titolo The EU Regulation no. 650/2012: the European way in cross-border successions.

L’evento si colloca nella cornice del progetto Towards the Entry into Force of the Succession Regulation: Building Future Uniformity upon Past Divergencies, coordinato dall’Università di Milano e finanziato dall’Unione europea.

Interverranno, fra gli altri, Peter Kindler (Univ. Ludwig Maximilan, Monaco), Ilaria Viarengo (Univ. Milano), Dan Andrei Popescu (Univ. Babeş-Bolyai, Cluj) e Francesco Pesce (Univ. Genova).

Maggiori informazioni a questo indirizzo.

The British Columbia Court of Appeal has upheld an interlocutory injunction made against Google Inc., a non-party, in litigation between Equustek Solutions Inc. and Datalink Technologies Gateways Inc.  The decision is available here.

The plaintiffs alleged that the defendants had counterfeited their product.  In an effort to prevent the defendants from selling the counterfeit product, which was being done over the internet, the plaintiffs sought and obtained an interlocutory injunction against Google Inc., a Delaware corporation based in California, ordering it to exclude a list of certain web sites from search results.  The aim was to stop customers from finding the defendants.  Google Inc. appealed the injunction on several grounds.

The court concluded that it had in personam jurisdiction over Google Inc. because it conducted business in the province: it advertised to residents of British Columbia and it actively obtained data for use in its search engines in British Columbia.  It held that the fact that Google Inc. was a non-party did not prevent the making of the injunction as against it.  It also held that the fact that the injunction had extraterritorial effects, requiring Google Inc. to take steps outside British Columbia, was not a valid objection.  On these issues the court reviewed several leading United Kingdom cases, including The Siskina, Channel Tunnel Group and South Carolina Insurance.  It also commented favourably on the recent decision in Cartier International AG v British Sky Broadcasting Limited, [2014] EWHC 3354 (Ch.).  Key Canadian authorities relied on include MacMillan Bloedel, BMWE and Minera Aquiline Argentina.

The decision is likely to be important on the question of what it means to carry on business over the internet.

On 11 June 2015, the European Union deposited its instrument of approval of the Hague Convention of 30 June 2005 on Choice of Court Agreements.

Two declarations are appended to the instrument of approval: a declaration under Article 30 (i.e. a declaration regarding the competences exercised by a Regional Economic Integration Organisation, to be made when such an Organisation accedes to the Convention without its Member States), and a declaration regarding the succession of the European Union to the European Community.

The move of the European Union paves the way to the entry into force of the Convention. Pursuant to Article 31(1), the Convention shall in fact “enter into force on the first day of the month following the expiration of three months after the deposit of the second instrument of ratification, acceptance, approval or accession”. The first of these instruments was the instrument of ratification deposited by Mexico in 2007.

The Convention will thus enter into force for Mexico and the European Union on 1 October 2015.

On 11 June 2015, the European Union deposited its instrument of approval of the Hague Convention of 30 June 2005 on Choice of Court Agreements.

Two declarations are appended to the instrument of approval: a declaration under Article 30 (i.e. a declaration regarding the competences exercised by a Regional Economic Integration Organisation, to be made when such an Organisation accedes to the Convention without its Member States), and a declaration regarding the succession of the European Union to the European Community.

The move of the European Union paves the way to the entry into force of the Convention. Pursuant to Article 31(1), the Convention shall in fact “enter into force on the first day of the month following the expiration of three months after the deposit of the second instrument of ratification, acceptance, approval or accession”. The first of these instruments was the instrument of ratification deposited by Mexico in 2007.

The Convention will thus enter into force for Mexico and the European Union on 1 October 2015.

La Camera dei Deputati ha approvato in via definitiva, l’11 giugno 2015, il disegno di legge di legge che prevede l’autorizzazione alla ratifica della Convenzione sulla competenza, la legge applicabile, l’efficacia delle decisioni e la cooperazione in materia di responsabilità genitoriale e di misure di protezione dei minori, fatta all’Aja il 19 ottobre 1996, nonché l’esecuzione della Convenzione nell’ordinamento italiano (sull’iter del provvedimento, si veda da ultimo questo post).

Il voto dell’aula interviene a pochi giorni di distanza dalla seduta delle commissioni riunite Giustizia e Affari esteri, svoltasi il 4 giugno 2015, nel corso della quale è emerso l’orientamento di procedere senza ulteriori indugi all’approvazione del testo sortito dal Senato, risultante dallo stralcio delle norme di adattamento ordinario e di integrazione del diritto interno ivi previste (atto Camera 1589-B), salva “la necessità che da parte del Governo venga assunto un impegno concreto affinché l’eventuale approvazione del testo trasmesso dal Senato sia accompagnata da una futura ma non lontana approvazione del disegno di legge che contiene le norme di attuazione interna”.

I have delayed reporting on this initiative for exam reasons. The Belgian Parliament is currently debating a private members’ proposal for statute to address so-called ‘vulture funds’. These funds are described by the financial dictionary as ‘A fund that buys distressed debt of commercial companies or sovereign nations at a cheap price and then often sues them for the entire value of the debt. The resemblance to vultures is because these funds profit from the debt of failing companies or poor nations.‘

The text of the proposal (in Dutch and French) is available here. Vulture funds litigation is generally called immoral in the proposal. Reference is made to a number of high-profile recent judgments where vulture funds have been given approval by various courts worldwide, to seek redress against assets held by the sovereign nations concerned, or indeed their creditors. Particularly sore is the enforcement sought against funds destined for development aid.

The proposal essentially defines ‘vulture funds’ and then suggests that recognition and enforcement of relevant judgments or arbitral awards, regardless of the law applicable to the underlying relationship with the government concerned, is considered to be contrary to Belgian ordre public international, hence unenforceable. The proposal as it stands now adds (probably superfluously) that relevant EU (read: the Brussels I recast Regulation) and international (read especially: the 1958 New York Convention) law takes priority.

The part of the proposal that is bound to attract attention is the attempt at defining the ‘vulture’ in vulture funds. Frits Bolkestein for instance (former EU Commissioner) has remarked that buying up ‘bad debt’ need not always be morally reprehensible (I would suggest it is not that part of the fund’ activities which has attracted the Belgian Parliament’s attention). The enforcement /recognition part of the proposal is interesting because it applies ordre public in a categorical manner, rather than in the ad hoc application which both EU law and residual Belgian conflicts law (the Belgian Private International Law Act) ordinarily call for. For residual Belgian law, this is probably Parliament’s prerogative. However for EU law (and the New York convention), a general apprehension against vulture funds may not qualify as a proper exercise of the ordre public exception. Courts at the least may wish formally to disregard the act when the judgment /award concerned is covered by Brussels I cq. New York; however they can point to the sentiment expressed in the Act, to support incompatibility with Belgian ordre public when tested against an individual case.

The drafters are aware that this initiative may be a drop in the ocean. Reference is made to other, national initiatives (France, UK, US) which may point to an emerging pattern of anti-vulture funds sentiment. Indeed the realities of forum shopping mean that vulture funds action will migrate away from the Belgian legal order. On the other hand, Belgium’s safe harbour may also mean that relevant assets will seek refuge there. All of course, presuming the initiative will actually be adopted by Parliament.

Geert. Disclosure: I advised the MPs concerned on the technical aspects of the recognition and enforcement leg of the proposal. [My advice may or may not have been followed ].

Michel José Reymond, La compétence internationale en cas d’atteinte à la personnalité par Internet, Schulthess, 2015, ISBN 9783725585328, pp. 387, Euro 82,10.

[Dal sito dell’editore] Quel tribunal est compétent pour juger d’un cas d’atteinte à la personnalité commise sur le réseau Internet? Le cas échéant, quel droit sera applicable? Avec en toile de fond la rencontre entre la territorialité des principes du droit international privé et l’ubiquité du réseau Internet, ce travail présente, compare et analyse les différentes approches qu’ont adoptées les juges confrontés à cette problématique; il aboutit sur une proposition permettant, pour ce qui concerne la compétence, de mieux prendre en compte les caractéristiques de la publication par Internet. Il met également le doigt sur les difficultés ressenties par le législateur communautaire à résoudre la question du droit applicable à ces atteintes, et examine à cet effet plusieurs des règles de conflit proposées lors de ses travaux.

Il sommario è disponibile qui. Ulteriori informazioni a questo indirizzo.

Si terrà a Roma l’11 settembre 2015 un incontro dal titolo Towards a transnational approach for choice-of-law clauses.

L’evento è organizzato organizzato dal Comitato Nazionale italiano della Camera di Commercio Internazionale e dall’Associazione Italiana per l’Arbitrato.

Tra i relatori, Massimo Benedettelli (Univ. Bari), Piero Bernardini (Associazione Italiana per l’Arbitrato), Fabio Bortolotti (Buffa, Bortolotti e Mathis), Andrea Carlevaris (Corte Internazionale di Arbitrato), Filip De Ly (Erasmus Univ.), Maria Beatrice Deli (Univ. Molise e Comitato Nazionale italiano della Camera di Commercio Internazionale), Yves Derains (Derains & Gharavi), José Angelo Estrella Faria (Unidroit), Franco Ferrari (Univ. Verona e New York Univ.), Marcel Fontaine (Univ. Catholique de Louvain), Luca Radicati di Brozolo (Univ. Cattolica di Milano), Anna Veneziano (Unidroit).

Il programma completo può leggersi qui, assieme alle informazioni relative all’iscrizione.

Il sequestro europeo di conti bancari – Regolamento (UE) n. 655/2014 del 15 maggio 2014, a cura di Pietro Franzina e Antonio Leandro, con scritti di Pietro Franzina, Lidia Sandrini, Elena D’Alessandro e Antonio Leandro e prefazione di Fausto Pocar, Giuffrè, 2015, pp. XIV+186, ISBN 9788814207235, Euro 22.

[Dal sito dell’editore] L’Unione europea si è posta l’obiettivo di assicurare un’efficace tutela del credito nelle situazioni a carattere internazionale. Il regolamento (UE) n. 655/2014, applicabile dal 18 gennaio 2017, viene ad integrare gli strumenti rivolti a questo scopo dando vita ad un’ordinanza europea di sequestro conservativo dei conti bancari (OESC). L’innovativo provvedimento, reso dal giudice nazionale competente per il merito all’esito di una procedura uniforme semplificata e non contraddittoria, potrà essere fatto valere, senza bisogno di exequatur, in tutti gli Stati membri dell’Unione vincolati dal regolamento. In pratica, il creditore di una somma di denaro – sia esso un’impresa, un consumatore oppure una persona fisica a cui sia dovuta una prestazione alimentare – disporrà di uno strumento particolarmente agevole per aggredire in via cautelare, ovunque in Europa, gli averi bancari del debitore. Questo volume si propone di fornire una prima lettura del regolamento, analizzando in particolare, nella prospettiva della attuazione delle nuove norme in Italia, le questioni suscettibili di insorgere nell’ambito del procedimento per il rilascio dell’OESC, quelle riguardanti la tutela assicurata tanto al debitore quanto ai terzi e quelle relative alla circolazione dell’OESC in seno allo spazio giudiziario europeo. 

Il sommario del volume si può scaricare a questo indirizzo.

Maggiori informazioni sono disponibili qui.

Si svolgerà a Firenze il 5 giugno 2015, organizzato dal locale Consiglio notarile, un convegno dal titolo Profili di diritto internazionale dell’attività notarile. Si parlerà di successioni, regimi patrimoniali e maggiorenni vulnerabili.

Tra i relatori, Jacopo Re (Univ. Milano), Franco Salerno Cardillo (notaio in Palermo) e Daniele Muritano (notaio in Empoli).

Maggiori informazioni a questo indirizzo.

Isidoro Antonio Calvo Vidal, El certificado sucesorio europeo, La Ley, 2015, ISBN 9788490204108, pp. 364, Euro 42,93.

[Dal sito dell’editore] A partir de la fecha de su aplicación plena, el 17 de agosto de 2015, el Reglamento (UE) nº 650/2012 del Parlamento Europeo y del Consejo de 4 de julio de 2012 relativo a la competencia, la ley aplicable, el reconocimiento y la ejecución de las resoluciones, a la aceptación y la ejecución de los documentos públicos en materia de sucesiones mortis causa y a la creación de un certificado sucesorio europeo, determina el nuevo marco de las sucesiones internacionales en la Unión Europea, constituyendo un hito de especial relieve en la construcción de la Europa de los ciudadanos. El Reglamento incide directamente en la aplicación del derecho de sucesiones en los Estados miembros, tanto a la hora de abordar una planificación sucesoria, a través del otorgamiento del testamento o de otra disposición mortis causa, como al tiempo de llevar a cabo el desenvolvimiento de una sucesión ya causada. En España supone además la incorporación de novedades tan importantes como la posibilidad de la elección de la ley aplicable a la sucesión o la fijación de la residencia habitual como punto de conexión subsidiario en orden a la determinación de la misma. Pero es el certificado sucesorio europeo, el nuevo «pasaporte» de los herederos en Europa, el que puede considerarse como uno de los logros más importantes del nuevo instrumento comunitario, al permitir a herederos, legatarios, ejecutores testamentarios o administradores de la herencia probar fácilmente su cualidad, así como ejercer los derechos o las facultades respectivas, en los Estados miembros. A partir de estas consideraciones, esta monografía ofrece al lector, desde la reflexión teórica y la visión práctica de su autor, un acercamiento a los principales elementos que van a regir el inmediato tratamiento de las sucesiones transfronterizas en la Unión Europea.

Maggiori informazioni a questo indirizzo.

On 8 and 9 October 2015, the Academy of European Law (ERA) will host a conference entitled How to Handle International Commercial Cases.

The conference aims to cast light on the latest developments regarding commercial dispute resolution. It will focus on the recent case law in the area of European civil procedure and on the forthcoming changes in the field of EU private international law. This last topic will be devoted, in particular, to the imminent entry into force of the Hague Convention of 30 June 2005 on Choice of Court Agreements, the recast of the EU Insolvency Regulation, the revision of the European Small Claims Procedure, and Regulation No 655/2014 establishing a European Account Preservation Order procedure.

Further information on the conference available here.

I have reported elsewhere (In Dutch – I am hoping for some time at some point to write something similar in English; see in particular para 23) on the fact that the conjunctive ‘or’ has been dropped in all language versions of Article 19 of the Brussels I recast:

The provisions of this Section may be departed from only by an agreement:

• which is entered into after the dispute has arisen;
• which allows the consumer to bring proceedings in courts other than those indicated in this Section; or
• which is entered into by the consumer and the other party to the contract, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the same Member State, and which confers jurisdiction on the courts of that Member State, provided that such an agreement is not contrary to the law of that Member State.

This contrast with the similar proviso on choice of court in employment contracts, Article 23:

The provisions of this Section may be departed from only by an agreement:

• which is entered into after the dispute has arisen; or
• which allows the employee to bring proceedings in courts other than those indicated in this Section.

I have suggested, with others, that much as I do not understand why the conjunctive has been dropped, its deletion, combined with its being kept in Article 23, means that for consumer contracts, choice of court pre the dispute are now simply impossible under the Regulation, while being maintained for employment contracts. I was also puzzled as to why such an important change was not discussed at all in the run-up to the recast.

A little bird at the European Commission (one high up the conflicts tree) now tells me that what has happened in reality, is quite different. Reportedly the ‘juristes-linguistes’ took it upon them to correct an apparent linguistic mistake in the previous version of the Regulation (indeed one going back to the Brussels Convention): there ought not to be a conjunctive when listing more than one, non-cumulative alternative. That would also explain the difference with Article 23, where there are only 2 alternatives.

This clears up the legislative intent. It does not to me, at least, clear up the linguistic confusion. We may have been grammatically wrong under the previous format (I cannot judge the correctness of that in all these language versions). However at least we were legally certain. Being fully respectful of grammatical correctness myself (punctuation jokes never fail to amuse me), I am not sure which one to prefer in this instance.

Geert.

The programme of the 10th Annual Conference of the Journal of Private International Law, which will take in place in Cambridge from 3 to 5 September 2015, is available here.

As in the previous editions, there will be a plenary session (on 4 September) and a number of panels devoted to specific issues (Family, Tort, Internet, Succession, Arbitration, Theory, Enforcement of judgments, Contracts, Practice, Insolvency, Jurisdiction).

For more information, click here.

Benjamin Mathieu, Directives européennes et conflits de lois, LGDJ, 2015, ISBN 9782275046389, pp. 382, Euro 45.

[Dal sito dell’editore] La construction du marché intérieur – et les libertés de circulation qu’il garantit – conduit l’Union européenne à réglementer les relations transfrontières de droit privé. Le droit européen investit, de ce fait, le terrain du droit international privé. Le droit dérivé en général, vecteur de l’intégration juridique des États membres, est ainsi la source d’un nombre croissant de dispositions de droit international privé. Les instruments conflictuels y sont placés au service de la construction européenne et voient ainsi leur finalité séculaire redéfinie. Les directives européennes en particulier, normes « à deux étages », ajoute à cette réorientation une difficulté particulière tenant à son mode d’élaboration. La présente étude se propose d’expliquer l’influence des directives sur le conflit de lois à travers le prisme des méthodes du droit international privé. Elle tend à montrer qu’un double mouvement d’influence réciproque caractérise les relations entre ces textes et ces méthodes. La réception des méthodes traditionnelles par les directives provoque une série de perturbations susceptibles de renouveler leur analyse classique. Inversement, des procédés nouveaux, issus de la construction du marché intérieur et présents au sein des directives, enrichissent la théorie du droit international privé. Cette analyse permet de mettre en lumière la diversité des méthodes de droit international privé contenues dans les directives européennes.

Maggiori informazioni a questo indirizzo.

Antonio Leandro, the author of this post, teaches International Law at the University of Bari.

On 20 May 2015 the European Parliament approved the new European Insolvency Regulation (EIR) in the text adopted by the Council at first reading on 12 March (publication on the Official Journal is expected to follow soon) [Update: the Regulation has been published on the Official Journal of the European Union of 5 June 2015, as Regulation (EU) 2015/848 of 20 May 2015 on insolvency proceedings]. This marks the end of a revision process which started with the Commission proposal of 12 December 2012 (COM/2012/744 final).

The primary aim of the revision was to improve the operation of the EIR with a view to ensuring a smooth functioning of the internal market and its resilience in economic crises, having regard to national insolvency laws and to the case law of the ECJ on the “old” Insolvency Regulation, i.e. Regulation No 1346/2000 (the relevant ECJ judgments include: Susanne Staubitz-Schreiber [2006]; Eurofood IFSC [2006]; Deko Marty Belgium [2009]; SCT Industri [2009]; German Graphics [2009]; MG Probud [2010]; Interedil [2011]; Zaza Retail [2011]; Rastelli Davide [2011]; F-Tex SIA [2012]; ERSTE Bank Hungary [2012]; Ulf Kazimierz Radziejewski [2012]; Bank Handlowy [2012]; Grontimmo [2013]; Meliha Veli Mustafa [2013]; Ralph Schmid [2014]; Burgo Group [2014]; Nickel & Goeldner Spedition [2014]; H [2014]).

In short, the revised text: (a) extends the EIR’s scope to proceedings aimed at giving the debtor a “second chance”; (b) strengthens the current jurisdictional framework in terms of certainty and clarity; (c) improves the coordination among insolvency proceedings opened in respect of the same debtor and strikes a better balance between efficient insolvency administration and protection of local creditors; (d) reinforces the publicity of the proceedings by compelling Member States to provide for insolvency registers and by providing for the interconnection of national registers; (e) deals with the management of multiple insolvency proceedings relating to groups of companies.

The new EIR will enter into force following its publication in the Official Journal, but the bulk of its provisions will only apply in 2017.

A broader scope

Opening the EIR to collective rescue and restructuring proceedings, to proceedings which leave the debtor fully or partially in control of its assets and affairs and to proceedings providing for a debt discharge or a debt adjustment in relation to consumers and self-employed persons as well as to interim proceedings, means that the appointment of a “liquidator” and the debtor’s divestment are no more grounds of the EIR’s applicability.

The difference between “all-creditors-including” and “not-all-creditors-including” proceedings has been implicitly upheld. However, Recital 14 clarifies that proceedings not including all the creditors should be proceedings aimed at rescuing the debtor, while those leading to a definitive cessation of the debtor’s activities or to the liquidation of the debtor’s assets should include all the creditors.

Annex A lists the proceedings at stake: national insolvency procedures not listed fall out of the scope of the Regulation. In doing so, Annex A provides – as the ECJ held in Ulf Kazimierz Radziejewski (§§ 23-24) and Meliha Veli Mustafa (§ 36) – a clear-cut confine of the EIR’s scope.

Moreover, the extension to proceedings whose purpose is not liquidation has led to replacing the term “liquidator” with “insolvency practitioner”, so as to include a broader range of tasks in connection with the administration of the debtor’s affairs. Annex B lists the relevant insolvency practitioners based on national laws.

Hereinafter, we will refer to the insolvency practitioner appointed in the main proceedings as the “main insolvency practitioner” and to the one appointed in secondary proceedings as the “secondary insolvency practitioner”.

The innovations regarding jurisdiction

Some Recitals inspired by Eurofood and Interedil have been inserted in the new EIR to clarify the concept of “centre of main interests” (COMI).

It is now stated that the COMI of individuals is to be found – presumptively – in their “principal place of business”, if they are independent businessmen or professional providers, or in their habitual residence, in all other cases (Article 3(1)).

In order to avoid fraudulent or abusive forum shopping practices, these presumptions will only apply if the registered office/principal place of business/habitual residence have not been transferred to another Member State within a given period prior to the request for the opening of the insolvency proceedings.

The court requested to open the proceedings will rule on jurisdiction of its own motion, and specify in the judgment on which ground it retained jurisdiction (Article 4).

Vis attractiva over “ancillary” proceedings is now codified in Article 6. Moreover, should the “ancillary” action be related with another action based on civil and commercial law, then the insolvency practitioner is entitled to bring both claims in the court of the defendant’s domicile or, in the case of several defendants, in the court of the Member State where any of them is domiciled, provided that such court has jurisdiction under the Brussels I Regulation (recast).

Coordination of proceedings

The new EIR improves the coordination among insolvency proceedings opened against the same debtor, and attempts to strike a better balance between efficient insolvency administration and protection of local creditors.

In particular, it makes the opening of secondary proceedings conditional upon both the interests of local creditors and the objectives of the main proceedings, and accordingly, strengthens the main insolvency practitioner’s role in this regard.

The court of the establishment will be enabled, on request of the main insolvency practitioner, to refuse or to postpone the opening of secondary proceedings whenever this is not necessary to protect the interest of local creditors.

When ruling on a request for opening brought by local creditors, the court of the establishment should give the main insolvency practitioner the opportunity to be heard before deciding (Article 38). The main insolvency practitioner will have the opportunity to apply for refusal or postponement of the opening of secondary proceedings, while the court of the establishment will be in a position to be aware of any rescue or reorganization options explored by the main insolvency practitioner, so as to properly assess the consequences of the opening.

Based on these and other elements, the court may refuse the opening or opt for proceedings not involving the winding-up of the debtor. This differs from the current regime, which allows for the alternative proceedings option only for territorial proceedings, i.e. prior to the opening of main proceedings.

In line with this new broadened role in evaluating the impact of secondary proceedings upon the centralized rescue or the estate administration, the main insolvency practitioner will be entitled to challenge the decision whereby secondary proceedings are opened.

As regards the protection of local creditors, in order to avoid the opening of secondary proceedings, the main insolvency practitioner may undertake within the main proceedings, in respect of assets located in the Member State of the establishment, ‘that he will comply with the distribution and priority rights under national law that [they] would have if secondary proceedings were opened’ (Article 36(1)). This undertaking should remove the local creditors’ concern over seeing themselves deprived of interests and preferential rights based on the local lex concursus by the opening of the sole main proceedings and by the applicability of the COMI’s lex concursus. At the same time, it will avoid the opening of secondary proceedings that may adversely affect the outcome of the main insolvency proceedings, in particular where the latter are aimed at rescue and restructuring.

In this respect, the new EIR draws inspiration from the “synthetic secondary proceedings”.

If secondary proceedings are opened or the request of opening is still pending, the new EIR extends the duty to cooperate both to the courts involved and between courts and insolvency practitioners (Articles 41-43).

Courts and insolvency practitioners are also required to take account of principles and guidelines adopted by European and international organizations active in the area of insolvency law, including the UNCITRAL guidelines (Recital 48). For instance, the courts may coordinate with each other to appoint the insolvency practitioners, while courts and insolvency practitioners may enter into protocols and agreements to facilitate cross-border cooperation and to coordinate the administration and supervision of the debtor’s assets and affairs.

Publishing insolvency information

Member States are required to establish publicly accessible electronic registers that contain information on cross-border cases (Article 24). All national registers will be interconnected with each other through the European e-Justice portal (Article 25).

This mandatory regime is meant to safeguard the foreign creditors’ right to lodge claims and prevent the opening of parallel proceedings. As for the foreign creditors – i.e. those having their habitual residence, domicile or registered office in a Member State other than the State of the proceedings, including the tax authorities and social security authorities of Member States: Article 2(12) –, their right to lodge claims will be facilitated by using a standard form to be established in an implementing act of the Commission.

Certain protective rules concerning the personal data have been inserted on account of the fact that, as noted above, the new Regulation will also apply to proceedings opened against persons who do not carry out an independent business or professional activity: see Articles 78-83. Having these cases in mind, Recital 80 strikes a balance with the creditors’ right to lodge the claims by calling Member States to ensure both that the relevant information is given to creditors by individual notice and that claims of creditors who have not received the information are not affected by the proceedings.

Groups of companies

The revision also addresses the management of multiple insolvency proceedings relating to groups of companies, introducing a specific Chapter (V). This strives to ensure the efficiency of the insolvency administration, whilst respecting each group member’s separate legal personality.

In this regard, the new EIR draws inspiration from the UNCITRAL Model Law and related Legislative and Practice Guides.

Firstly, should more proceedings be opened in different Member States, the new EIR requires all the actors involved (insolvency practitioners and courts) to comply with the duties of cooperation and communication applicable when main and secondary insolvency proceedings are opened against the same debtor (Chapter V, Section 1).

An important innovation is that an insolvency practitioner is now allowed to request the opening of a “group coordination proceeding”, which should further facilitate, in particular, the restructuring of groups (Chapter V, Section 2). The participation of the other insolvency practitioners (hence, the other proceedings) rests on a voluntary basis.

A “coordinator” will be appointed to propose and implement the coordination plan (Articles 71-72).

All the advantages of the “coordination proceedings” should be worth the costs. In other words, the costs of the coordination should be sustainable and adequate having regard to the purpose of each proceedings involved.

The introduction of groups-of-companies oriented rules will not prevent a court from opening insolvency proceedings for several companies in a single State if the court finds a common COMI therein (Recital 53).

What about the applicable law?

The revision only marginally addresses the issue of applicable law.

However, Article 11(2) and Article 13(2) of the new texts are noteworthy in this respect, in that they manage, as regards contracts relating to immovable property and contracts of employment, the effects of the insolvency stemming from the (local) lex contractus when the insolvency being handled abroad in the main proceedings.

Article 18 extends to pending arbitration proceedings the existing rule whereby the effects of insolvency proceedings on a pending lawsuit concerning assets or rights included in the debtor’s insolvency estate must be governed by the law of the Member State where the lawsuit is pending (the law of the seat of the arbitration will apply).

Finally, all the rules whose functioning depends on the concept of “Member State in which assets are situated” will benefit from the broader and more detailed definition provided by Article 2(9), which refers, among other “assets”, to registered shares in companies, financial instruments, cash held in credit institutions accounts and copyrights.

In Case C-352/13 CDC, in which the ECJ held last week, at issue is among others the use of Article 6(1) of the Brussels I-Regulation (8(1) in the recast) when the claim against the anchor defendant has been settled before the trial is well and truly underway.

I reviewed JÄÄSKINEN AG’s opinion here.  The ECJ’s overall approach to Article 6 is not to take into account the subjective intentions of plaintiff, who often identify a suitable anchor defendant even if is not the intended target of their action. Like its AG, the Court does make exception for one particular occasion, namely if it is found that, at the time the proceedings were instituted, the applicant and that defendant had colluded to artificially fulfil, or prolong the fulfilment of, Article 6’s applicability. I had expressed reservation vis-a-vis this suggestion, obviously in vain. In cases such as these, where tort is already clearly established (via the European Commission’s cartel finding), the intention of ECJ and AG seem noble. Collusion to defraud is disciplined by the non-applicability of Article 6. However this arguably serves the interests of the parties guilty of the other type of collusion involved: that of defrauding not procedural predictability, but rather consumers’ interest. 

Next, the referring court enquired about the application of Article 5(3)’s special jurisdictional rule in the event of infringement of competition law, where that infringement concerns a complex horizontal agreement, spread over a long period of time, and with varying impact in various markets. The AG had suggested dropping application of Article 5(3) (now 7(1)) altogether, both with respect to locus delicti commissi and locus damni. Here the Court disagreed. Difficult as it may be, it is not to be excluded that locus delicti commissi can be established. At 50: one cannot rule out ‘the identification, in the jurisdiction of the court seised of the matter, of a specific event during which either that cartel was definitively concluded or one agreement in particular was made which was the sole causal event giving rise to the loss allegedly inflicted on a buyer.’

For locus damni, the Court again has no sympathy for either mozaik effect of Article 5(3), or indeed the often great difficulties in establishing locus damni, flagged by the AG. At 52: ‘As for loss consisting in additional costs incurred because of artificially high prices, such as the price of the hydrogen peroxide supplied by the cartel at issue in the main proceedings, that place is identifiable only for each alleged victim taken individually and is located, in general, at that victim’s registered office.‘

Registered office as the locus damni for purely economic loss, lest my memory fails me, has not been as such confirmed by the ECJ before. It is also currently pending in Universal. The Court is in my view a bit radical when it comes to justifying registered office as the Erfolgfort: at 53: ‘That place fully guarantees the efficacious conduct of potential proceedings, given that the assessment of a claim for damages for loss allegedly inflicted upon a specific undertaking as a result of an unlawful cartel, as already found by the Commission in a binding decision, essentially depends on factors specifically relating to the situation of that undertaking. In those circumstances, the courts in whose jurisdiction that undertaking has its registered office are manifestly best suited to adjudicate such a claim.‘

Finally, on the issue of choice of court in the agreements between the victims of the cartel, and those guilty of the cartel, the Court follows the AG’s lead. Such clauses are not generally applicable to liability in tort (the clause would have to refer verbatim to tortious liability). Neither do they in principle bind third parties, lest of course there be subrogration (Refcomp). (The referring national court has given very little detail on the clauses at issue and hence the ECJ notes that it could not reply to all questions referred).

In the end, it is the finding with respect to economic loss for which the judgment may be most remembered.

Geert.