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The European Association of Private International Law
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Update on PIL Aspects of Environmental Damage and Human Rights Violations in Supply Chains

Tue, 12/21/2021 - 08:00

This post was contributed by Olivera Boskovic, who is a Professor at the Université de Paris.

The situation of victims of environmental damages or human rights violations caused in non-EU countries by subsidiaries or subcontractors of companies established in the EU (but the issue can be extended to companies merely operating in the EU) trying to bring actions before the courts of EU Member States is well known. The Shell case, in which victims of serious environmental damage in Nigeria sued the Dutch parent company and its Nigerian subsidiary before the Dutch court, is quite emblematic in this respect. (The last decision in this case has been issued on 29th of January 2021 by the Hague Court of Appeal. See Shell Nigeria liable for oil spills in Nigeria). The need to modify certain rules of private international law in order to address these actions in a satisfactory manner has been debated for some time now. The purpose of this post is to provide an update and examine the current state of the debate. Difficult questions may arise both concerning jurisdiction and concerning the determination of applicable law.

Jurisdiction

Jurisdiction, first of all, remains problematic although the situation has somewhat improved in recent years. From a European perspective, as the law stands today, a first fundamental distinction is between cases in which the defendant is domiciled in an EU Member State and those in which the defendant is domiciled in a third country.

Where the action is brought against a defendant domiciled in an EU Member State (i.e, in our context, actions brought directly against the parent company or the ordering company), jurisdiction is based on the Brussels Ia Regulation. This regulation always allows a defendant to be sued in the court of his domicile, so that jurisdiction should not be a problem in this case. (For example, in the Shell case the jurisdiction of the Dutch court to hear the action against the Dutch company did not pose any problem). Instead, the obstacles are of a substantive nature and relate to the difficulty of holding companies liable for the actions of their subsidiaries or subcontractors.

The situation is more problematic when the defendant is domiciled outside the EU, (i.e. in our context when the action is brought against subsidiaries or subcontractors who are direct perpetrators of the damage or simply against companies domiciled outside the EU). These actions are excluded from the scope of the Brussels Ia Regulation. They are subject to the national laws of the Member States, and the rules may therefore differ considerably from one country to another. Generally speaking, it is quite difficult to establish the jurisdiction of a Member State court in this type of case. One can therefore consider that there is a problem of access to justice, in so far as the rules of jurisdiction do not take account of economic links, or even the economic unity of groups of companies. Nevertheless, there are avenues available and in particular two worth mentioning: the co-defendants’ rule and the forum necessitatis (or jurisdiction based on the risk of denial of justice) Indeed, several Member States have rules based on one or other of these mechanisms, or even both. As a reminder, the co-defendants’ rule makes it possible, when an action is brought against several defendants, one of whom is domiciled in the forum State and the other outside the EU, to sue all the defendants before the court of the domicile of the one domiciled in the forum State, provided of course that the claims are related. The forum necessitatis, on the other hand, allows the court of the forum to be seized when no foreign court can be seized by the claimant, who therefore risks a denial of justice. More than the issues raised by the application of each of these rules what is noteworthy is the lack of unification at the European level. As regards the forum necessitatis, its introduction into the Brussels I Regulation was proposed in 2010 and again recently in 2020, but without success. As for the co-defendants rule (involving a defendant domiciled outside the EU), its introduction in the Regulation has never been proposed.

New Grounds of Jurisdiction in the Brussels Ibis Regulation

Nevertheless, it appears that the introduction of these two rules into the Regulation would be a real improvement. Of course, this opinion is not shared by all writers. There are divergent views among scholars. Some are hostile to the introduction of the forum necessitatis. (see Ch. Tomale, On the EP draft report on corporate due diligence) They consider there is no need for such a rule, especially at a time when the Supreme court of the United States is moving in the opposite direction and has adopted a very strict position. However, contrary to what can sometimes be read, the idea is not to allow member state courts to hear cases with no connection whatsoever to the EU. A minimum link with the legal order of the court seized is required by all proposals (see the GEDIP proposal concerning the private international law aspects of the future European instrument on corporate due diligence and corporate accountability, October 2021; draft treaty on business and human rights, August 2020; Sofia guidelines for international civil litigation for human rights violation, 2012 adopted by the ILA). Of course, the question is then whether this minimum link should be defined by the rule or left for the court to decide. Taking into account the diversity of situations that may occur, it is preferable to leave the definition of the minimum link to the courts. This seems to be the approach adopted by recent initiatives. On the contrary, other scholars consider that situations where a real risk of denial of justice can be characterised are the only situations in which European courts should rule on this type of dispute. The concern that home state courts should not consider that it is always better for them to decide this type of case and that they should assert jurisdiction only when it is really necessary because the host state courts cannot handle the litigation in a satisfactory way has been voiced by many commentators during debates. Even the Court of Appeal in the famous Vedanta case decided in the UK commented that ‘there must come a time when access to justice in this type of case will not be achieved by exporting cases, but by the availability of local lawyers, experts, and sufficient funding to enable the cases to be tried locally”. Scholars who hold this position are implicitly hostile to the co-defendants rule. These differences raise the question of relations between these two grounds of jurisdiction and whether one should be preferred. In the opinion of the present writer the answer is no. These rules are complementary. (The opinion according to which the forum necessitates rule is a second-best solution and an activity-based rule could be imagined is also worth mentioning. This question was discussed during the interesting webinar on “The recommendation of GEDIP concerning the private international aspects of the future EU instrument on corporate due diligence and corporate accountability” organised by the Italian Interest group on Private international law on December 10 2021 featuring as speakers H. Van Loon and Giulia Vallar.)

Therefore, the minimum solution would be to introduce into the Brussels Ia Regulation the forum necessitatis which allows victims to bring an action in front of the court of a EU Member State, irrespective of the existence of a co-defendant domiciled in an EU Member State, but on condition that they can show that it is impossible to bring the case before another court. The rule is devised as an exceptional rule. If the European legislator wanted to go further, (it is the present writer’s opinion that this is desirable), they should introduce, in addition, the co-defendants rule, which makes it easier to bring an action, without the need to show the impossibility of seizing another court, but provided that a European defendant is also involved in the proceedings and that the claims are related. This approach has been adopted by several recent initiatives. The latest version (August 2020) of the draft binding treaty on business and human rights negotiated within the UN framework contains both rules. The same is true of the GEDIP recommendation to the European Commission. Considering the fact that England has often been described as a magnet forum for this type of litigation, it is interesting to note that in all these proposals, contrary to the English system, the two grounds of jurisdiction (presence of a forum-based co-defendant and the risk of denial of justice) are two separate grounds of jurisdiction. This indeed seems to be a better solution. Another difference lies in the fact that the English system takes into account the risk of substantial denial of justice whereas the forum necessitatis focuses on the impossibility to seize another court. However, the two systems might be closer than they seem at first sight. The impossibility to seize another court can be characterized if the claimant can not “reasonably” seize another court. This is an open door for consideration of a risk of substantial denial of justice. In a nutshell, it appears that the attractivity of the English forum does not lie in rules on jurisdiction.

Parallel Litigation

Another important question relating to jurisdiction is the question of parallel proceedings. The Mariana Dam case recently brought in front of the English courts shed light upon this question. In the aftermath of the worst environmental disaster in the history of Brazil, an action was brought in the UK against the Anglo-Australian mining multinational BHP. It was initially rejected, but has been reopened in July 2021 under exceptional appeals legislations (CPR 52.30) in order to “avoid real injustice”. The way lis pendens and the related actions exceptions are treated is very important. In addition to the problem of parallel litigation brought by victims both in the host and in the home country, It is vital to make sure that they are not transformed into weapons by potential defendants seeking declarations of non-liability in non-member States and then invoking the lis pendens or related actions exception. However, one may consider that the tools that already exist in the Bia regulation are satisfactory and that no legislative reform is needed on this point. Although relying on the conditions of recognition and the concept of “good administration of justice” can seem a bit vague, it is submitted that a certain degree of judicial discretion is inevitable.

Applicable Law

After jurisdiction, the second question concerns the determination of the law applicable to these actions. As the law stands today, a difficulty arises from the fact that choice of law rules often designate the law of the place of the damage, which in these cases is frequently the law of a country outside the EU with a less developed legal system. In reality, to understand the current situation, a twofold distinction must be made, firstly according to whether or not the defendant is domiciled in the EU, and secondly according to whether it is a question of environmental damage or a human rights violation. With regard to actions against defendants domiciled outside the EU, (i.e. in current litigation, actions against subsidiaries and subcontractors), they will always be governed by the law of the place where the damage occurred, which corresponds to the law of their activity. (It is important to note that this does not necessarily mean impunity for these defendants. For example, in the Shell case the Dutch court held the Nigerian subsidiary liable by virtue of Nigerian law). On the other hand, with regard to actions against parent companies or ordering companies established in the EU, as the law stands today, a distinction must be made between cases involving environmental damage and cases involving a violation of human rights. The former are covered by Article 7 of the Rome II Regulation, which allows the claimant to choose between the law of the place of the event giving rise to the damage and the law of the place where the damage occurred. The latter are covered by Article 4, which designates exclusively the law of the place of the damage. This last rule, in our context, is problematic. This problem is at the origin of the proposal by the European Parliament’s Committee on Legal Affairs to insert an Article 6a on “Actions for breach of human rights in commercial matters” which would have allowed the victim to choose between several laws.

The first question that arose upon publication of the proposal was: do we need a new choice of law rule? Some scholars consider that we do not and that it is sufficient to classify the rules of the future European instrument as overriding mandatory provisions (see. the post of G. Rühl here). However, a different view is possible. It is the opinion of the present writer that a choice of law rule would indeed be useful. Indeed, by definition, only a limited number of provisions can be characterised as overriding mandatory provisions. The rules on limitation, for example, will not be considered as such. However, they can be quite decisive in litigation. The action may be dismissed because, for example, the law of the place of the damage, which is a law of a non-EU country, contains a very short limitation period. Therefore, a choice of law rule would protect the victims more than the overriding mandatory rules method and consequently contribute to the public interest objective of making companies more responsible. In any event, the two methods can be combined. The adoption of a new choice of law rule for human right abuses, would not make the overriding mandatory rules approach irrelevant. This is also the position of the GEDIP. In its recommendation it combines the two approaches.

Extending the Scope of Article 7 Rome II

Going back to the European Parliament’s Committee on Legal Affairs’ proposal, although it is the opinion of the present writer that a special choice of law rule is indeed desirable, the provision as proposed was not immune from criticism (See. O. Boskovic, « La loi applicable aux « actions pour violations des droits de l’homme en matière commerciale », Recueil Dalloz 11 fév. 2021, p. 252). Firstly, having two provisions, one applicable to environmental damage and the other applicable to human rights violations would cause very difficult boundary problems (bearing in mind, for example, that according to some estimates one third of human rights violations involve environmental offences). Secondly, the connecting factors used in the proposed article 6a raised many questions. For this reason, it appears more appropriate to have a single choice of law rule for human rights violations and for environmental damage. Article 7 should therefore be rewritten to include human rights violations. The victim would then be able to choose between the law of the place of the damage and the law of the place where the event giving rise to the damage occurred, which would increase their chances of success. (This is also the position of the GEDIP proposal. However, one should note that the scope of the GEDIP proposal is wider and applies, just like the future European instrument, not only to human rights and environmental damages but also to good governance. The precise definition of this last concept is difficult and the desirability of having the same rule is debatable. This very interesting question was discussed during the above-mentioned webinar organised by the Italian interest group on private international law.) However, this idea then gives rise to another question: How should the “event giving rise to the damage” be interpreted in this context? Obviously, for the text to achieve its objective, it must be accepted that the event giving rise to the damage can, at least if the factual circumstances are appropriate, be located at the place where the decisions were or were not taken, i.e. at the domicile of the parent company (a recital could be inserted to encourage such an interpretation) (I have developed these ideas in O. Boskovic, « La loi applicable aux « actions pour violations des droits de l’homme en matière commerciale », Recueil Dalloz 11 fév. 2021, p. 252.). The Hague Tribunal in the Shell case ruled along these lines in its decision issued on May 26th 2021, which has already been characterised as historical. It is interesting to note that a similar question arose in the Arica v. Boliden case decided by the Swedish courts in 2019. In this case under Swedish choice of law rules, applicable rationae temporis, the lex loci delicti commissi applied. In determining the locus delicti commissi, the court held that the center of gravity should be found and that ‘This center may be established with regard to where the qualitatively important elements have their focus rather than according to quantitative criteria’. Therefore, in this case concerning the export of toxic waste from Sweden to Chile, contrary to the first instance decision, the court of appeal held that the event giving rise to the damage was localized in Sweden. It is certain that agreeing on an adequate choice of law rule is not enough. The localization of the connecting factors is of paramount importance. (A similar question arose in the Nestlé v. Doe case. The Supreme Court explained that, because the ATS does not apply extraterritorially, in order for the court to have jurisdiction “plaintiffs must establish that conduct relevant to the statute’s focus occurred in the United States”. This was not the case because the only relevant alleged domestic conduct by the defendants consisted of general corporate activity-like decisionmaking- which  is insufficient to establish domestic application of the ATS. Contrary to the emerging trend in the EU, the Supreme Court of the US has shown continuous caution on this matter, apparently considering that it is not a matter for judicial lawmaking)

Revising Article 17 Rome II

Another important question concerns situations where poor performance of contractual obligations causes damage to third parties. The Kik case in Germany or Begun v. Maran case in the UK come to mind. A very important step in the fight for corporate accountability would be to facilitate actions brought by these third parties The aim is to ensure that the ethical and environmental clauses contained in international contracts do not remain a dead letter. Indeed, as the Court of Appeal observed in Begun v. Maran, often all protagonists know that theses clauses will be totally ignored. A revision of Article 17 of the Rome II Regulation could thus be envisaged in the form of the addition of a sentence: “Account shall also be taken of the ethical clauses contained in the contracts whose breach has caused the damage.” (on this problem see our forthcoming article « Contrats internationaux et protection de l’environnement », in actes du colloque du 15 juin 2021, Le droit économique, levier de la transition écologique ?)

Finally, it appears that the possibility of applying more widely foreign overriding mandatory provisions would contribute to the pursuit of these global governance goals. A modification of Rome I and Rome II along these lines would be welcome.

As these few remarks show, the debate on private international law aspects of corporate social accountability is far from over.

Update – December at the Court of Justice of the European Union

Mon, 12/20/2021 - 08:00

The jugdment on C-251/20, Gtflix, will be published on Tuesday 21. The request for a preliminary reference of the French Cour de Cassation, focused on Article 7(2) of the Brussels I bis Regulation, had triggered a long opinion by M. Hogan (the Irish Advocate General at that point in time). Although he favoured the characterization of the act at stake as a form of malicious falsehood – thus falling under the scope of unfair competition rules-  and indicated expressly that “the present case is not the right one for the Court to take a position on whether or not the mosaic approach should be maintained” (point 95), the actual relevance of the case lies precisely there. He himself devoted his opinion to it, providing the Grand Chamber (K. Lenaerts, L. Bay Larsen, A. Arabadjiev, A. Prechal, I. Jarukaitis, N. Jääskinen, T. von Danwitz, L.S. Rossi, A. Kumin, N. Wahl, and M. Safjan as reporting judge) with arguments and counterarguments. It would be disappointing if the Court does not take a stance.

Eagerly waiting.

Quick reminder:

The question was:

‘Must Article 7(2) of Regulation (EU) No 1215/2012 be interpreted as meaning that a person who, considering  that his or her rights have been infringed by the dissemination of derogatory comments on the internet, brings proceedings not only for the rectification of information and the removal of content but also for compensation for the resulting non-material and material damage, may claim, before the courts of each Member State in the territory of which content published online is or was accessible, compensation for the damage caused in the territory of that Member State, in accordance with the judgment in eDate Advertising (paragraphs 51 and 52), or whether, pursuant to the judgment in Svensk Handel (paragraph 48), that person must make the application for compensation before the court with jurisdiction to order rectification of the information and removal of the derogatory comments?’

Advocate General Hogan proposed the following answer:

Article 7(2) of Regulation No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as meaning that a claimant who relies on an act of unfair competition consisting in the dissemination of disparaging statements on the internet and who seeks both the rectification of the data and the deletion of certain content and compensation for the non-material and economic damage resulting therefrom, may bring an action or claim before the courts of each Member State in the territory of which content published online is or was accessible, for compensation only for the damage caused in the territory of that Member State. In order, however, for those courts to have the requisite jurisdiction it is necessary that the claimant can demonstrate that it has an appreciable number of consumers in that jurisdiction who are likely to have access to and have understood the publication in question.”

Children’s Right to Information in EU Civil Actions

Fri, 12/17/2021 - 08:00

Ilaria Queirolo (University of Genova), Salvatore Patti (University of Rome La Sapienza), Carlos Esplugues Mota (University of Valencia), Boriana Musseva (Sofia University), Dana Rone (Turiba University, Riga), Laura Carpaneto (University of Genova) and Francesca Maoli (University of Genova) have edited Children’s Right to Information in EU Civil Actions, published by the Italian publisher Pacini.

The volume collects the results of the EU co-funded Project Minor’s Right to Information in EU civil actions – Improving children’s right to information in cross-border civil cases – MiRI, European Union Justice Programme 2014-2020, JUST-JCOO-AG-2018-831608. It critically addresses the fundamental right of the child to receive information during the course of civil proceedings affecting him or her, with particular reference to the peculiarities characterizing cross-border proceedings in family matters. In this context, the right to information is coinceived not only as a corollary of the right of the child to be heard during the course of the proceedings, but also in the light of the possible developments as an autonomous procedural right. The volume rationalizes the main criticalities emerging from the current practice in several EU Member States and offers a set of Guidelines, aimed at improving the situation of children involved in cross-border family proceedings, in order to enhance and protect their fundamental rights.

The contributors include Roberta Bendinelli, Leontine Bruijnen, Laura Carpaneto, Carlos Esplugues Mota, Samuel Fulli-Lemaire, Maria González Marimón, Sara Lembrechts, Francesca Maoli, Boriana Musseva, Vasil Pandov, Francesco Pesce, Ilaria Queirolo, Pablo Quinzá Redondo, Geraldo Rocha Ribeiro, Dana Rone, Tine Van Hof, Daja Wenke.

The book is fully accessible here.

CJEU on Single Habitual Residence of Spouses

Thu, 12/16/2021 - 09:37

On 25 November 2021, the Court of Justice handed out its judgement in IB (C-289/20), in which it followed the earlier Opinion of AG Sánchez-Bordona. The preliminary question referred to the Court in this case concerned the jurisdictional rules of Article 3(1)(a) of the Brussels II bis Regulation and was aimed at clarifying whether a spouse might have his or her ‘habitual residence’ in more than one country, which could result in courts of both Member States having jurisdiction in proceedings relating to matrimonial matters. This post was published previously on EU Law Live.

Background

The background to the case concerns the applicant IB, who wanted to institute divorce proceedings at forum actoris pursuant to the sixth indent of Article 3(1)(a) of the Brussels II bis Regulation, having strong ties to two countries, Ireland due to family and social interests and France due to professional and patrimonial interests.

CJEU’s Analysis

Referring to Mikołajczyk (C-294/15), the Court of Justice recalled that Article 3 of the Brussels II bis Regulation provides for very generous grounds of jurisdiction, which are alternative, but exclusive. The rules of the fifth and sixth indents of Article 3(1)(a) were designed considering interests of the spouse who, after the breakdown of the marriage, decides to move back to his or her home country nad wants to institute proceeding there (paragraph 35). The concept of ‘habitual residence’ is not defined in the Brussels II bis Regulation; however, it is consistently used in a singular form. The use of the adjective ‘habitual’ suggests that on the one hand the residence should have a stable and regular character and on the other the transfer of habitual residence to another country should reflect the willingness of remaining there with the intention of establishing there the stable center of one’s life interests. The assimilation of the habitual residence of a person, in this case a spouse, to the permanent or habitual centre of his or her interests does not militate in favour of accepting that a number of residences may simultaneously have such a character (paragraphs 40-44).

The objective of Article (3)(1)(a) of the Brussels II bis Regulation is to reconcile legal certainty with the reality of the mobility of persons within the EU. Assuming that one might have multiple habitual residences would definitely undermine this legal certainty and predictability as to which court might hear the case. It would also create a risk that the concept of ‘habitual residence’ would be equated with simple residence. Additionally, such interpretation of the concept of habitual residence under the Brussels II bis Regulation would have repercussions for other EU instruments, namely the Maintenance Regulation and the Matrimonial Property Regulation, which provide for jurisdictional basis dependent on the jurisdiction in matrimonial matters (paragraph 48).

CJEU’s Conclusion

As a result, a person might have only one habitual residence within the meaning of Article 3(1)(a) of the Brussels II bis Regulation (paragraph 51). Having concluded the above, the Court of Justice clarified the meaning of the concept of ‘habitual residence’. Its judgements concerning habitual residence of a child, in HR (C-512/17) for example, were used as a starting point. Then the Court underlined the specificities of the situation of an adult, namely the will of returning to the home country after the marriage breakdown, as well as the more diverse nature of the environment, which is composed of different activities and diversified interests – professional, sociocultural, patrimonial, and familial (paragraph 56). Habitual residence is characterized by two elements, namely the willingness of fixing one’s center of interests in a given place and the presence of sufficiently stable character (paragraph 57). The Court of Justice thus seemed to suggest that IB might have indeed changed his place of habitual residence (paragraphs 59-61) but noted that it is for the referring court to ascertain.

Overall, the judgement is not a surprising one, as it stands in line with previous jurisprudence of Court of Justice, for example in EE (C-80/19), when it states that the habitual residence of the deceased must be established in a single Member State (paragraph 40).

EC’s Initiative on Recognition of Parenthood – An Update

Wed, 12/15/2021 - 09:00

The European Commission (EC) set out an initiative Recognition of parenthood between Member StatesAs underlined by the EC, the initiative aims to ensure that parenthood, as established in one EU country, is recognised across the EU, so that children maintain their rights in cross-border situations, in particular when their families travel or move within the EU. Currently, in certain circumstances they might see the parenthood not recognised, which in turn might result in adverse consequences for the child (for example, obstacles in obtaining a passport or an identity card).

These problems might be easily illustrated by the background of the case, which resulted in a very recent judgement of the Court of Justice in Stolichna obshtina, rayon “Pancharevo” (C-490/20). See posts on this blog on the attitude of administrative authorities of some Member States, on the example of Bulgaria and AG Kokott’s opinion as to its implications in EU law, especially the Charter of Fundamental Rights of the EU – respectively – here and here.

Inception Impact Assessment

As reminded in the inception impact assessment published in Spring 2021, there is currently no instrument on the recognition of parenthood at the international level. The Hague Conference on Private International Law (HCCH) is engaged in exploring the possibilities of tackling this issue (information about these works might be found at HCCH website here). In the EU, each Member State applies its own law on the recognition of civil status records/judgements on parenthood handed down in another Member State. On the one hand, under EU treaties, substantive family law falls within the competence of Member States. Their substantive rules on the establishment and recognition of parenthood differ. On the other hand, the EU has competence to adopt measures concerning family law with cross-border implications pursuant to Article 81(3) TFEU. These measures can include the adoption of common conflict rules and the adoption of common procedures for the recognition of judgments issued in other Member States. The EC plans to present a proposal of the regulation by the third quarter of 2022.

Public Consultation

The EC has also lunched a public consultation. The outcome of the consultation was recently published (and is available here). Although collected answers are not necessary representative for the whole EU (interestingly, out of 389 answers 112 come from Slovakia), they indicate that indeed there are instances where parenthood was not recognised as between Member State.

(…) the cases mainly involved a child born out of surrogacy (37% or 116 responses), followed by a child born out of assisted reproductive technology (ART) (23% or 73 responses) and second parent adoption by the partner of the biological parent (21% or 65 responses). Other cases in which parenthood was not recognised included parenthood established by operation of law (14% or 45 responses) and adoption by two parents (10% or 30 responses). Adoption by one single parent and establishment of parenthood over an adult were not recognised according to 6% (or 18 responses) and 3% (or 8 responses) respectively.

As specified by respondents, the primary reason for not recognising parenthoods established in another Member State is that the recognition of parenthood is contrary to the national law of the Member State [or rather a public policy of that Member State? – AWB] where recognition is sought (72% or 184 responses) (…)

Expert Group

The Expert Group was set up to advise EC on the preparation of this new legislative initiative. The Group has met already on several occasions. As  minutes of these meeting reveal (see here for details), the Group was discussing, inter alia, the very notion of “recognition” with respect to parenthood, which often is confirmed by an administrative document, for example the birth certificate.

(…) existing Union instruments address the circulation of authentic instruments under three possible forms: acceptance, only enforcement and recognition and enforcement, and that by definition enforcement is not applicable to the status of persons. The group considered that acceptance may refer only to the evidentiary effects of the facts recorded in the document but not to the existence of a legal relationship, such that only recognition would be relevant for the purposes of the planned regulation on parenthood. 

It was thus agreed that the term ‘recognition’ should be used in the proposal as it refers not only to the factual elements but also to the legal effects of the authentic instrument. 

Enhanced Cooperation?

It might be added that adoption of a regulation under Article 81(3) TFEU requires unanimity. As a result, so far regulations aimed at unifying international family law were adopted within enhanced cooperation, due to lack of such unanimity (for example, the Divorce Regulation). The side effect is that these regulations are applied only in participating Member States, which undermines the unification efforts of the EU. Hence, there is a risk that non-participating Member States could be the ones, in which the problem of non-recognition of parenthood established in another Member State is more pressing than in other ones.

CJEU Rules on the Interplay between Brussels IIA and Dublin III

Tue, 12/14/2021 - 08:00

This post was contributed by Dr. Vito Bumbaca, who is Assistant Lecturer at the University of Geneva.

In a ruling of 2 August 2021 (A v. B, C-262/21 PPU), the CJEU clarified that a child who is allegedly wrongfully removed, meaning without consent of the other parent, should not return to his/ her habitual residence if such a removal took place as a consequence of the ordered transfer determining international responsibility based on the Dublin III Regulation. The judgment is not available in English and is the first ever emanating from this Court concerning the Brussels IIA-Dublin III interplay.

The Brussels IIA Regulation complements the Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction, and is applicable to 26 EU Member States, including Finland and Sweden. The Regulation (EU) No 604/2013 of 26 June 2013 establishing the criteria and mechanisms for determining the Member State responsible for examining an application for international protection lodged in one of the Member States by a third-country national or a stateless person (recast) (Dublin III), is pertinent for asylum seekers’ applications commenced at least in one of the 31 Member States (EU/EFTA), comprising Finland and Sweden, bound by this Regulation.

Questions for a CJEU Urgent Preliminary Ruling

The CJEU was referred five questions, but only addressed the first two.

(1) Must Article 2(11) of [Regulation No 2201/2003], relating to the wrongful removal of a child, be interpreted as meaning that a situation in which one of the parents, without the other parent’s consent, removes the child from his or her place of residence to another Member State, which is the Member State responsible under a transfer decision taken by an authority in application of Regulation [No 604/2013], must be classified as wrongful removal?

(2) If the answer to the first question is in the negative, must Article 2(11) [of Regulation No 2201/2003], relating to wrongful retention, be interpreted as meaning that a situation in which a court of the child’s State of residence has annulled the decision taken by an authority to transfer examination of the file, and to take no further action since the mother and child have left the State of residence, but in which the child whose return is ordered, no longer has a currently valid residence document in his or her State of residence, or the right to enter or to remain in the State in question, must be classified as wrongful retention?

Background

In 2019, a married couple, third-State nationals (Iran), both with regard to Brussels IIA and Dublin III respective Member States, moved from Finland to settle in Sweden. Since 2016, the couple had lived in Finland for around three years. In 2019, a child was born in Sweden. The couple was exercising joint custody over the child in conformity with Swedish law. The mother was holding a family residency permit, in both Finland and Sweden, through the father’s employment rights. The approved duration of the mother’s residency right in Finland was around one year longer than in Sweden.

Two months after the child’s birth, the latter and the mother were placed under Swedish residential care (hostel). Essentially, the Swedish administrative decision to uphold this care protective measure was the result of the father’s violence against the mother, so to protect the child from the risks against his development and health, as well as to prevent his wrongful removal to Iran possibly envisaged by his father. Limited contact rights were granted to the father. A residency permit was requested, individually, by the father and the mother based on the family lien – request respectively filed on 21 November and 4 December 2019.

In August 2020, the mother submitted an asylum request, for the child and herself, before the Swedish authorities. The same month, the Finnish authorities declared themselves internationally responsible over the mother’s and child’s asylum request by virtue of article 12(3) of Dublin III – based on the longer duration of the residency permit previously delivered according to Finnish law. In October 2020, the Swedish authorities dismissed the father’s and rejected the mother’s respective residency and asylum requests, and ordered the transfer of the child and his mother to Finland. Taking into account the father’s presence as a threat against the child, the limited contacts established between them, and the father’s residency right in Finland, the Swedish authorities concluded that the child’s separation from his father was not against his best interests and that the transfer was not an obstacle to the exercise of the father’s visitation right in Finland. In November 2020, the mother and the child moved to Finland pursuant to article 29(1) of Dublin III. In December 2020, the father filed an appeal against the Swedish court’s decisions, which was upheld by the Swedish Immigration Tribunal (‘Migrationsdomstolen i Stockholm’), although it resulted later to be dismissed by the Swedish Immigration Authorities, and then rejected by the Immigration Tribunal, due to the child’s relocation to Finland (CJEU ruling, § 23-24).

In January 2021, the father filed a new request before the Swedish authorities for family residency permit on behalf of the child, which was still ongoing at the time of this judgment (CJEU ruling, § 25). During the same month, the mother deposited an asylum application before the Finnish authorities, which was still ongoing at the time of this judgmentthe mother’s and child’s residency permits were withdrawn by the Finnish authorities (CJEU ruling, § 26). In April 2021, the Swedish Court (‘Västmanlands tingsrätt’), notwithstanding the mother’s objection to their jurisdiction, granted divorce, sole custody to the mother and refused visitation right to the father – upheld in appeal (‘Svea hovrätt’). Prior to it, the father filed an application for child return before the Helsinki Court of Appeal (‘Helsingin hovioikeus’), arguing that the mother had wrongfully removed the child to Finland, on the grounds of the 1980 Hague Convention. The return application was rejected. On the father’s appeal, the Finnish authorities stayed proceedings and requested an urgent preliminary ruling from the CJEU, in line with article 107 of the Luxembourg Court’s rules of procedure.

Judgment

The Court reiterated that a removal or retention shall be wrongful when a child holds his habitual residence in the requesting State and that a custody right is attributed to, and effectively exercised by, the left-behind parent consistently with the law of that State (§ 45). The primary objectives of the Brussels IIA Regulation, particularly within its common judicial space aimed to ensure mutual recognition of judgments, and the 1980 Hague Convention are strictly related for abduction prevention and immediate obtainment of effective child return orders (§ 46).

The Court stated that, pursuant to articles 2 § 11 and 11 of the Brussels IIA Regulation, the child removal to a Member State other than the child’s habitual residence, essentially performed by virtue of the mother’s right of custody and effective care while executing a transfer decision based on article 29 § 1 of the Dublin III Regulation, should not be contemplated as wrongful (§ 48). In addition, the absence of ‘take charge’ request following the annulment of a transfer decision, namely for the purposes of article 29 § 3 of Dublin III, which was not implemented by the Swedish authorities, would lead the retention not to being regarded as unlawful (§ 50). Consequently, as maintained by the Court, the child’s relocation was just a consequence of his administrative situation in Sweden (§ 51). A conclusion opposing the Court reasoning would be to the detriment of the Dublin III Regulation objectives.

Some Insights from National Precedents

In the case ATF 5A_121/2018, involving a similar scenario (cf. FamPra.ch 1/2019), the Swiss Federal Court maintained that a child born in Greece, who had lived for more than a year with his mother in Switzerland, had to be returned to Greece (place of the left-behind parent’s residence) based on the established child’s habitual residence prior to the wrongful removal to Switzerland, notwithstanding his pending asylum application in the latter State. Indeed, the Greek authorities had been internationally responsible over the child’s asylum request on the basis of his father’s residence document. However also in that case it was alleged that the father had been violent against the mother and that a judgment ordering the child’s return to Greece, alone or without his mother (§ 5.3), would not have caused harm to the child under the 1980 Hague Convention, art. 13.

In the case G v. G [2021] UKSC 9, involving a slightly different scenario in that no multiple asylum requests were submitted, the UKSC judged that a child, of eight years old born in South Africa, should not be returned – stay of proceedings – until an asylum decision, based on an asylum application filed in England, had been taken by the UK authorities. The UKSC considered that, although an asylum claim might be tactically submitted to frustrate child return to his/ her country of habitual residence prior to wrongful removal or retention, it is vital that an asylum claim over an applicant child, accompanied or not by his/ her primary carer, is brought forward while awaiting a final decision – in conformity with the ‘non-refoulement’ principle pursuant to article 33 of the 1951 Geneva Convention relating to the Status of Refugees.

Comment

The CJEU ruling is momentous dictum in that it holds the not any longer uncommon intersection of private international law and vulnerable migration, especially with regard to children in need of international protection in accordance with both Brussels IIA and Dublin III Regulations (cf. Brussels IIA, § 9, and Dublin III, article 2 lit. b). The Luxembourg Court clarifies that a child who is allegedly wrongfully removed, meaning without consent of the other parent, should not return to his/ her habitual residence if such a removal took place as a consequence of the ordered transfer determining international responsibility based on the Dublin III Regulation. It is emphasised that, contrary to the Swiss judgment, the child in the instant case did not have any personal attachments with Finland at the time of the relocation – neither by birth nor by entourage – country of destination for the purposes of the Dublin III transfer. Moreover, the ‘transfer of responsibility’ for the purposes of Dublin III should be contemplated as an administrative decision only, regardless of the child’s habitual residence.

It is observed as a preamble that, according to a well known CJEU practice, a child should not be regarded as to establish a habitual residence in a Member State in which he or she has never been physically present (CJEU, OL v. PQ, 8 June 2017, C-111/17 PPU; CJEU, UD v. XB, 17 October 2018, C-393/18 PPU). Hence, it appears procedurally just that the Swedish courts retained international jurisdiction over custody, perhaps with the aim of Brussels IIA, article 8 – the child’s habitual residence at the time of the seisin, which occurred prior to the transfer to Finland. On that procedural departure, the Swedish courts custody judgment is substantially fair in that the father’s abuse against the mother is indeed an element that should be retained for parental responsibility, including abduction, merits (CJEU ruling, § 48; UKSC judgment, § 62).

However, it is argued here that, particularly given that at the relevant time Sweden was the child’s place of birth where he lived for around 14 months with his primary carer, the Swedish and the Finnish authorities might have ‘concentrated’ jurisdiction and responsibility in one Member State, namely Sweden, ultimately to avoid further length and costs related to the asylum procedures in line with the same Dublin III objectives evoked by the CJEU – namely “guarantee effective access to the procedures for granting international protection and not to compromise the objective of the rapid processing of applications for international protection” (§ 5, Dublin III). Conversely, provided that the child’s relocation was not wrongful as indicated by the Finnish authorities, and confirmed by the CJEU ruling, the Swedish authorities may have opted for the ‘transfer of jurisdiction’ towards the Finnish authorities on the basis of Brussels IIA, article 15(1) lit. b, indicating the child’s new habitual residence (cf. Advocate General’s opinion, § 41) following the lawful relocation (cf. article 15.3., lit. a).

Importantly, concentration of jurisdiction-responsibility over a child seeking international protection in one Member State, in light of the Brussels IIA-Dublin III interplay, would essentially determine a coordinated interpretation of the child’s best interests (cf. Brussels II, § 12, and Dublin III, § 13), avoiding two parallel administrative-judicial proceedings in two Member States whose authorities may not always come to similar views, as opposed to the present case, over such interests (AG’s opinion, § 48). This is particularly true, if the child (non-)return to his/ her habitual residence might likely be influenced, as stated in the CJEU ruling, by his/ her administrative situation, which would potentially have an impact on the international custody jurisdiction determination. An example of controversial outcome, dealing with child abduction-asylum proceedings, is the profoundly divergent opinion arising from the UK and Swiss respective rulings, to the extent of child return in a situation where the mother, primary carer, is or could be subject to domestic violence in the requesting State.

Similarly, the UKSC guidance, in ‘G v. G’, affirmed: “Due to the time taken by the in-country appeal process this bar is likely to have a devastating impact on 1980 Hague Convention proceedings. I would suggest that this impact should urgently be addressed by consideration being given as to a legislative solution […] However, whilst the court does not determine the request for international protection it does determine the 1980 Hague Convention proceedings so that where issues overlap the court can come to factual conclusions on the overlapping issues so long as the prohibition on determining the claim for international protection is not infringed […] First, as soon as it is appreciated that there are related 1980 Hague Convention proceedings and asylum proceedings it will generally be desirable that the Secretary of State be requested to intervene in the 1980 Hague Convention proceedings” (UKSC judgment, § 152-157). Clearly, the legislative solution on a more efficient coordination of child abduction-asylum proceedings, invoked by the UK courts, may also be raised with the EU [and Swiss] legislator, considering their effects on related custody orders.

 

— Cross posted at Conflictoflaws.net.

The Private Side of Transforming our World

Mon, 12/13/2021 - 08:00

Ralf Michaels, Veronica Ruiz Abou-Nigm and Hans van Loon have edited The Private Side of Transforming our World – UN Sustainable Development Goals 2030 and the Role of Private International Law, recently published by Intersentia.

In 2015, the United Nations formulated 17 ambitious goals towards transforming our world – the Sustainable Development Goals (SDG 2030). Their relation to public international law has been studied, but private law has received less attention in this context and private international law none at all. Yet development happens – not only through public action but also through private action, and such action is governed predominantly by private law and private international law. This book demonstrates an important, constructive role for private international law as an indispensable part of the global legal architecture needed to turn the SDGs into reality. Renowned and upcoming scholars from around the world analyse, for each of the 17 SDGs, what role private international law actually plays towards these goals and how private international law could, or should, be reformed to advance them. Together, the chapters in the book bring to the fore the hitherto lacking private side of transforming our world.

An open access online version of this book is also available, thanks to financing by the Max Planck Institute for Comparative and International Private Law. It is available here through Intersentia Online.

The book comes with a chapter for each Sustainable Development Goals, i.e.: No Poverty; Zero Hunger; Good Health and Well-Being; Quality Education; Gender Equality; Clean Water and Sanitation; Affordable and Clean Energy; Decent Work and Economic Growth; Industry, Innovation and Infrastructure; Reduced Inequalities; Sustainable Cities and Communities; Sustainable Consumption and Production; Climate Action; Life below Water; Life on Land; Peace, Justice and Strong Institutions; Partnership for the Goals.

Contributors include Eduardo Álvarez-Armas (Brunel University London), Vivienne Bath (University of Sydney), Gülüm Bayraktaroğlu-Özçelik (Bilkent University), Klaus D. Beiter (North-West University), Sabine Corneloup (University Paris II Panthéon-Assas), Klaas Hendrik Eller (University of Amsterdam), Nikitas E. Hatzimihail (University of Cyprus), Thalia Kruger (University of Antwerp), Ulla Liukkunen (University of Helsinki), Benyam Dawit Mezmur (University of the Western Cape), Ralf Michaels (Max Planck Institute for Comparative and International Private Law / Queen Mary University, London), Richard Frimpong Oppong (California Western School of Law), Fabricio B. Pasquot Polido (Universidade Federal de Minas Gerais), Verónica Ruiz Abou-Nigm (University of Edinburgh), Jay Sanderson (University of the Sunshine Coast), Tajudeen Sanni (Nelson Mandela University / One Ocean Hub), Geneviève Saumier (McGill University), Anabela Susana de Sousa Gonçalves (University of Minho School of Law), Drossos Stamboulakis (Monash University), Jeannette M.E. Tramhel (Organization of American States), Hans van Loon (Institut de droit international; former Secretary General Hague Conference) and Jinske Verhellen (Ghent University).

Nishioka and Nishitani on Japanese Private International Law

Fri, 12/10/2021 - 08:00

Kazuaki Nishioka (visiting Research Fellow at the Law Faculty of the University of Zurich) and Yuko Nishitani (Professor of International Private and Business Law at Kyoto University Graduate School of Law) published a new book on Japanese Private International Law with Hart Publishing series – Studies in Private International Law – Asia.

The volume seeks to be a leading reference on Japanese private international law in English. The chapters systematically cover all the areas of Japanese private international law: commercial matters, family law, succession, cross-border insolvency, intellectual property, competition (antitrust), and environmental disputes.

The analysis does not look only into the traditional conflict of law areas of jurisdiction, applicable law (choice of law), and enforcement, but addresses also the conflict of law questions arising in arbitration and assesses Japanese involvement in the global harmonisation of private international law.

In addition to summarising relevant principles and scholarly views, the authors discuss case law whenever possible, identify deficiencies and anticipate difficulties in the existing law.

The book presents the Japanese conflict of laws through a combination of common and civil law analytical techniques and perspectives, providing readers worldwide with a more profound and comprehensive understanding of the subject.

A table of contents is available here and an extract here.

CJEU Rules Claims for Unjust Enrichment need not be Contractual or Delictual for Jurisdictional Purposes

Thu, 12/09/2021 - 16:00

On 9 December 2021, the CJEU delivered its judgment in HRVATSKE ŠUME d.o.o., Zagreb v. BP EUROPA SE (Case C-242/20).

The main issue before the Court was whether a claim for unjust enrichment fell necessarily within the scope of the jurisdictional rule for contracts (Article 5(1) Brussels I Regulation, today Article 7(1) Brussels I bis Regulation) or the jurisdictional rule for delicts and quasi-delicts (Article 5(3) Brussels I Regulation, today Article 7(2) Brussels I bis Regulation), or whether it could fall in neither and thus fall within the scope of the general rule granting jurisdiction to the courts of the defendants of the domicile.

The Court followed the Advocate-General Conclusions and ruled that a claim for unjust enrichment which was not contractual in nature would not fall necessarily within the scope of the jurisdictional rule for delicts.

Background

The request was referred by the Visoki trgovački sud Republike Hrvatske (Cour d’appel de commerce, Croatie). The questions, still on the Brussels I Regulation, were asked in the context of a dispute between a company incorporated under Croatian law, and a company established in Hamburg (Germany), over a sum of money seized on the bank account of the first company and transferred to the assets of the second as part of an enforcement procedure. As this procedure was subsequently invalidated, the applicant in the main proceedings sought restitution of the sum in question on the basis of unjust enrichment.

The first question referred by the Croatian court was:

  1. Do actions for recovery of sums unduly paid by way of unjust enrichment fall within the basic jurisdiction established in Council Regulation (EC) No 44/2001 … in respect of ‘quasi-delicts’, since Article 5(3) thereof provides inter alia:: ‘A person domiciled in a Member State may, in another Member State, be sued … in matters relating to … quasi-delict, in the courts for the place where the harmful event occurred or may occur’?
Judgment

The CJEU ruled that the claim was neither contractual, nor delictual, and thus fell within the scope of the general jurisdictional rule of the domicile of the defendant.

The reasons given by the Court are essentially based on the language of the relevant provisions and, perhaps also on its structure.

First, the Court recognises that claims for unjust enrichment could be related to a contract, and thus be characterised as contractual in character.

The most interesting part of the judgment relates to those claims which are not related to a pre-existing contractual relationship. The Court rules that such claims do not fall within the scope of Article 5(3) / 7(2) either. The main reason given by the Court is that Article 5(3) / 7(2) refers to ‘harmful events’ and thus should be interpreted as applying only where such events are concerned. Yet,

55. A claim for restitution based on unjust enrichment is based on an obligation which does not originate in a harmful event. That obligation arises irrespective of the defendant’s conduct, with the result that there is no causal link that can be established between the damage and any unlawful act or omission committed by the defendant.

A widely shared view, which was defended by the Commission in this case, was that Article 5(3) / 7(2) was a residual rule, and that all claims based on obligations which would not fall within the scope of Article 5(1) / 7(1) should be considered as delictual for jurisdictional purposes. The view is clearly rejected.

The result is indeed the opposite. While it seemed before this case that most claims based on unjust enrichment would fall within the scope of Article 7(2), the Court suggests that it will amost never be the case. It explains that a claim for unjust enrichment could be related to a contract and characterised as contractual,

Another potential argument supporting the conclusion of the Court is mentioned at the outset, but it is unclear whether it genuinely considers it as important. The Court reiterates that special rules of jurisdiction should be interpreted restrictively. Thus, if a particular claim does not clearly fall within the scope of any of the special rules (e.g. Article 7(1) and (2) Brussels I bis), they should not apply.

The case was also concerned with the scope of the exclusive rule in Article 22(5) Brussels I. The Court found that:

36. In the absence of any application for enforcement, an action for restitution based on unjust enrichment does not come within the scope of Article 22(5) of Regulation No 44/2001.  

Takahashi on Blockchain-Based Negotiable Instruments

Thu, 12/09/2021 - 08:00

Koji Takahashi from Doshisha University Law School published on SSRN an article titled Blockchain-based Negotiable Instruments (with Particular Reference to Bills of Lading and Investment Securities). The article will be included as a chapter in the book: A. Bonomi, M. Lehmann (eds), Blockchain & Private International Law to be published by Brill.

The abstract reads as follows:

This paper will consider what should be the choice-of-law rules for the issues pertaining to blockchain-based negotiable instruments.

The concept of “negotiable instruments” refers to instruments representing relative rights (namely, entitlements that may be asserted against a certain person) such as rights to claim the performance of obligations and corporate membership rights. It depends on the applicable law which instrument qualify for this description. It covers, for example, “Wertpapier” defined by the Swiss Code of Obligations (Obligationenrecht) as any document with which a right is linked in such a way that it can neither be asserted nor transferred to others without the document (Article 965). The concept of “negotiable instruments” as used in this paper is broader than the same expression as ordinarily understood in English law. Under the latter, “negotiable instruments” ordinarily mean the instruments which allows a bona fide transferee to acquire a better title than what the transferor had. In this narrow sense, bills of lading are not negotiable instruments under English law though they are under German and Japanese law. As this paper will examine negotiable instruments in the wider sense, it will cover bills of lading and investment securities within its scope of analysis.

The concept of “blockchain-based negotiable instruments” refers to tokens issued on a blockchain which are meant to serve as negotiable instruments. This paper’s main focus is on blockchain-based bills of lading and blockchain-based investment securities (called crypto-securities). This paper will not make any particular mention of promissory notes, bills of exchange or cheques since no notable trend for issuing them on blockchains is observed as of the time of writing (August 2021) but they are not excluded from its scope. Intrinsic tokens (namely, tokens of self-anchored value) such as crypto-currencies are outside the scope of this paper since they do not represent any relative rights.

Montreal Convention Claims in the English Courts… where EU Law Applies

Wed, 12/08/2021 - 14:00

This post was written by Amy Held, LL.B., LL.M., LL.M., University of Vienna.

Judgment in Silverman v Ryanair DAC [2021] EWHC 2955 (QB) (10 November 2021) was recently handed down in the Queen’s Bench Division of the English High Court of Justice.  The issue for determination was a relatively simple one: whether English or Irish law applied to a claim made under the Montreal Convention.  This, however, raised the broader issue of how the Montreal Convention interacts with the choice of law rules of the lex fori; in particular, on matters on which the Montreal Convention is silent. The case is also of significance for aviation practitioners because, in practical terms, it was a determination of whether an airline can disapply the choice of law provisions contained in its own Terms and Conditions.

 The Facts

This case concerned a personal injury allegedly sustained whilst embarking a flight from East Midlands Airport in England to the Berlin Schönefeld Airport, in Germany.  It was common ground between the Claimant passenger and Defendant airline that the Montreal Convention for the Unification of Certain Rules for International Carriage by Air (‘the Montreal Convention’) applied to the claim.

Nor was it in issue before the court that Article 33 of the Montreal Convention effectively overrode the jurisdiction element of the dispute resolution clause contained in the Defendant’s Terms and Conditions of Carriage (‘the T&Cs’).  Notwithstanding that Clause 2.4 of the T&Cs conferred exclusive jurisdiction on the courts of Ireland (as well as specifying Irish law for matters of interpretation and governing law), Article 33 of the Montreal Convention is a mandatory, self-contained scheme for jurisdiction conferring upon claimants a wide range of choice as to the forum in which to issue their claim.  The English courts thereby had jurisdiction pursuant to the Claimant’s choice to issue in the place of his “principal and permanent residence.”

The issue on trial before the judge, Master McCloud (‘the Master’) was, however, the law applicable to quantum.  Although Article 17 of the Montreal Convention provides for the question of whether liability is established, the type of damage in respect of which compensation may consequently be recovered is a matter on which the Montreal Convention is silent.

Accordingly, the overarching issue of principle was whether, on matters on which the Montreal Convention is silent, those matters are governed by: (i) the law chosen by the parties; (ii) the lex fori or (iii) the law identified by the forum’s own choice of law rules.

A further key issue was whether: (i) the existence of a contract of carriage between the parties meant the claim fell within the Rome I Regulation on the law applicable to contractual obligations (Rome I); or (ii) notwithstanding such contract, the claim fell within the Rome II Regulation on the law applicable to non-contractual obligations (Rome II).

Governing Law for Matters on which the Montreal Convention is Silent

The Master considered domestic, international, and CJEU decisions to conclude that silence in an international Convention on a particular matter cannot “sensibly be treated” as overriding the forum’s own choice of law rules. Rather, silence in the Convention must be treated as operating as a ‘pass through’, authorising the forum to apply the law that would govern in the absence of the Convention in question.

Furthermore, it does not make any difference if those choice of law rules apply by virtue of another international Convention: in the present case, the Montreal Convention did not override Rome I and Rome II, which were to be treated as the domestic choice of law rules of the English forum.  Under the under the case law of the CJEU itself, the rules of jurisdiction contained in the Brussels regime are only disapplied in favour of the rules of jurisdiction contained in an international Convention where two conflict.

Accordingly, the question of quantum fell to be determined by the law identified by the choice of law rules of the English forum.

Rome I or Rome II?  Does the Governing Law Clause Survive?

The Master held at [65] that, as a matter of the English choice of law rules, Rome II, not Rome I, applied to the claim. Notwithstanding that a contract of carriage had been entered into by the parties with clear choice of Irish law, the claim did not plead a case of breach of contract, not even one in which the Montreal Convention was incorporated. Rather, the Claimant pleaded a case of breach of the Montreal Convention itself.  Given that the Montreal Convention does not require carriage by air to be pursuant to a contract, but encompasses gratuitous carriage, the Montreal Convention should be regarded as implementing its own system of law that encompasses both contractual matters and ‘classically tortious concepts’ such as strict liability for injury.  The fact that Rome I provides for claims in arising from contracts of carriage did not mean that a claim under the Convention, framed non-contractually, should invariably be treated as though it were a contractual claim.

As such, the present Montreal Convention claim was most appropriately categorised as a “claim in respect of a non-contractual obligation arising out of a tort or delict in the form of causing injury to the claimant through negligence” within the scope of Rome II.

So, the Law Governing Quantum is…

Notwithstanding that, under Article 4(1) of Rome II, claims in tort/delict are generally governed the law of the country in which the damage occurs, the Master considered that the present claim had a ‘manifestly closer connection’ with the law of Ireland within the meaning of Article 4(3) of Rome II.  Matters to which the Master gave particular emphasis was (i) a pre-existing relationship between the Claimant and Defendant in the form of the contract of carriage; the facts that such contract of carriage not only (ii) contained a clear choice of law clause; but (iii) selected as governing law the law of the place where the airline itself was domiciled.

Drawing upon academic literature, the Master accordingly concluded at [73] that, for issues of cognisable damage and quantum, English law, as the lex fori, identified Irish law as the governing law.

Comment

This was an unusual case in that the accident occurred in England, the loss was sustained in England, the claim was issued in England…and yet the Claimant sought to apply Irish law to govern the claim.  Accordingly, it might be said that, perhaps even more unusually, the Claimant’s case succeeded.

However, it is submitted that the Master correctly applied the relevant legal provisions to reach the correct conclusion: although the accident and damage was sustained in England, the English courts were seised by chance as a matter of the Claimant’s choice under Article 33(2) of the Montreal Convention as the place of his residence.  Had the Claimant been resident in another jurisdiction and issued there, the strength of the English nexus would have been greatly reduced.  In these circumstances, the application of Irish law would appear rather less incongruous.

The case also raises the question of whether ‘contracts conquer all.’  Prima facie, the conclusion drawn by the Master that Irish law applied appears to lend support to the proposition that, in the EU, a governing law clause in a contract of carriage will ultimately prevail when assessing recoverable damages and quantum for bodily injury within the meaning of Article 17 and other matters on which the Montreal Convention is silent; it does not matter whether Rome I or Rome II applies, as the outcome is the same.

This, however, overlooks one key part of the Master’s reasoning: whether the ‘escape clause’ in Article 4(3) of Rome II applies falls to be determined on a case-by-case basis upon consideration of the issue of ‘manifest connection.’   It cannot be said, therefore, that a contract of carriage containing a choice of law clause will always, without more, displace the general rule under Article 4(1) of Rome II that torts/delicts are governed by the law of the place in which the damage is sustained.

On a practical level, the case is also a useful reminder that although claims brought under the Montreal Convention are not necessarily claims in contract, the Master did not rule out the possibility that a comparable claim could be brought as one of breach of contract.  It appears that the matter ultimately turns on the way in which the claimant elects to plead his claim.

This is closely linked to the question of whether an airline can disapply the choice of law clause contained in its own T&Cs.  Strictly speaking, the choice of law rule in the present case was not so much ‘disapplied’ as simply not having been engaged by the facts of the case.  Characterisation of the claim as a tort/delict meant that the contractual provisions did not apply.  On the other hand, had the claim been pleaded and characterised as one for breach of contract, it is highly likely that the governing law clause would have survived to apply.

Rijeka Doctoral Conference – PIL and PIL-Related Topics

Wed, 12/08/2021 - 08:00

The Rijeka Doctoral Conference of 2021, organised by the Faculty of Law of the University of Rijeka features a several presentations dealing with topics within, or related to, private international law.

Session 1C, scheduled to take place on 10 December 2021 at 8.30 CET will be devoted to Private International Law & Intellectual Property Law. Chaired by Oliver Remien (Julius Maximilian University of Würzburg), Elena Alina Onţanu (Tilburg University) and Giulia Priora (NOVA School of Law, Lisbon), the session will host presentations by: Caterina Benini (Catholic University of Sacred Heart, Milan): The Law Applicable to the Choice-of-Court Agreements under the Brussels I bis Regulation; Denisa Docaj (University of Milan): Private International Law Issues Arising from Brexit: The Rule on Lis Pendens and Related Actions in Civil and Commercial Matters; Zuzana Vlachová (Masaryk University): Infringement of Copyright with a Cross-border Element – Applicable Law; Hongqian Zhou (Waseda University): Digital Exhaustion from the Perspective of Consumers and Competition.

Issues of private international law will arguably arise in other sessions, notably Session 2B, on Family & Succession Law, with a presentation by Nazeemudeen Ziyana (University of Aberdeen) on The Use of Adoption in the Context of International Surrogacy Arrangements: A Comparative Analysis, and Session 2C, on Maritime & Aviation Law, with a presentation by María Gorrochategui Polo (University of the Basque Country) on Collective Bargaining and Cross-Border Collective Actions: The Maritime Industry as a Paradigm for Other Land-Based Industries.

Session 4A, scheduled at 15.30, will be devoted to Arbitration Law & Competition Law. Franco Ferrari (NYU School of Law), Stefan Enchelmaier (University of Oxford) and Miguel Verdeguer Segarra (EDEM Escuela de Empresarios & University of Nebrija) will chair the session. Featured presentations include: Gautam Mohanty (Kozminski University, Warsaw): Joinder of Third-Party Funders in International Investment Arbitration; Yihua Chen (Erasmus University Rotterdam): Third-Party Funding in International Arbitration: A Transnational Study of Ethical Implications and Responses; and Denis Baghrizabehi (University of Maribor): Private Enforcement of State Aid Law in Civil Litigation.

Additional information, including the link to join the various sessions, may be found here.

Which Law Applies to Torts Committed under the Channel?

Tue, 12/07/2021 - 14:00

Which law applies to a tort committed in the Channel Tunnel, at 16 km from the exit on French territory?

This is the question that the Court of Appeal of Douai could have asked, but did not, in a recent judgment of 24 June 2021.

Background

The accident occurred in the middle of the night in January 2015. A truck belonging to a Romanian company took fire while being transported on a train under the Tunnel. The fire damaged four other trucks that an English company also wanted carried under the Tunnel before being brought to Sweden.

The insurers of the English company compensated part of the damage suffered (£ 599,000). The liability of the company managing the Tunnel (France Manche) was limited contractually at 280 000 DTS, i.e. € 356,000.  After receiving this payment, the insurers demanded payment from, and then sued the Romanian company in French courts for € 208,000.

French Tort Law

The French court applied French tort law. Article 1242 (formerly 1384), second paragraph, of the French civil code provides for fault based liability of the custodian of any thing causing a fire.  The court found, however, that the employee of the Romanian company was not the custodian of the truck when the accident occurred, as he has no control over the truck anymore: he had left it after it was put on the train, to go to a car during the journey under the Tunnel. The custodian had become France Manche, which had control over the truck. The action against the Romanian company was dismissed.

Choice of Law

It does not seem that any of the parties raised the issue of choice of law. Under French choice of law principles, the French court might have raised it ex officio, but was not obliged to.

Pursuant to Article 4 of the Rome II Regulation, the law of the place of the damage should have applied, unless the law of another state was manifestly more closely connected to the tort. The tort was certainly connected to a contract (of carriage), but it was not a contract as between the parties.

So where did the damage occur? It all depends where the border between England and France is.

Treaties

The issue is governed by the 1986 Canterbury Treaty which provides:

Article 3. FRONTIER AND JURISDICTION
(1) As regards any matter relating to the Fixed Link, the frontier between the United Kingdom and France shall be the vertical projection of the line denned in the Agreement signed at London on 24 June 1982 relating to the delimitation of the Continental Shelf in the area east of 30 minutes West of the Greenwich meridian, ‘ and the respective States shall exercise jurisdiction accordingly, subject to the provisions of paragraph 3 of this Article and any Protocol or particular arrangements made pursuant to Articles 4, 5, 7 and 8 below.
(2) The frontier in the Fixed Link shall be marked by a Joint Commission, composed of representatives of the two States, as soon as possible after the completion of the relevant section of the Fixed Link and in any event before the Fixed Link comes into operation.
(3) If in the construction of the Fixed Link any works carried out from one of the two States extend beyond the line of the frontier, the law that applies in that part which so extends shall, in relation to matters occurring before that part is effectively connected with works which project from the other State, be the law of the first mentioned State.
(4) Rights to any natural resources discovered in the course of construction of the Fixed Link shall be governed by the law of the State in the territory, or in the continental shelf, of which the resources lie.

The Agreement signed at London on 24 June 1982 relating to the delimitation of the Continental Shelf defines precisely the agreed border, with a chart annexed to the Agreement. I was able to find the Agreement, but it misses the chart !

The information available on the internet suggests that the resulting French undersea crossover is much longer than the English one (34 kms v. 17 kms). If that is correct, this means that the accident occurred on French territory.

One cannot help wonder, however, whether the place of the damage could not have equally been England in this case, and how meaningful the place of the damage is in such a case.

Should the law of the place of the damage be displaced in “transit” torts?

Although it was not concluded between the parties, should the contracts concluded by them with the same third party play a role? Should it be a decisive factor which would trigger the operation of the exception clause and lead to the application of the lex contractus?

The Recommendation of GEDIP Concerning the PIL Aspects of the Future EU Instrument on Corporate Due Diligence and Corporate Accountability

Tue, 12/07/2021 - 08:00

On 10 December 2021, from 16.30 to 19.00 CET, a webinar in English on The Recommendation of GEDIP Concerning the Private International Law Aspects of the Future EU Instrument on Corporate Due Diligence and Corporate Accountability, will take place, organised by the Interest Group on Private International Law of the Italian Society of International Law (SIDI).

Hans Van Loon, former Secretary General of the Hague Conference on Private International Law, and Giulia Vallar, of the University of Milan, will intervene.

This is the final event of a series of webinars entitled Private International Law in Europe: New Developments on Corporate Social Responsibility and Private International Law.

Attendance is free. Those wishing to join the webinar are invited to send an e-mail to sidigdipp@gmail.com.

ELI at 10: Protection of Adults in International Situations

Mon, 12/06/2021 - 08:00

A series of webinars have taken place since June this year to celebrate European Law Institute’s 10th anniversary. The latest in the series is about the ELI project on the Protection of Adults in International Situations and is scheduled for 7 December 2021, from 18:15 to 19:45 (CET),

The ELI project on adults seeks to encourage the European Union to consider both external action and the enactment of legislation in the field. The final report provides analysis and proposals regarding further issues surrounding the application of the Hague Convention of 13 January 2000 on the International Protection of Adults or otherwise relevant to the protection of adults in international situations. It also includes a checklist intended for practitioners, to encourage the development of private mandates within the ambit of the substantive laws of the Member States.

Confirmed speakers are: Aneta Wiewiórowska-Domagalska (Chair; ELI Executive Committee member; Senior Research Fellow, University of Osnabrück), Pietro Franzina (ELI Project Co-Reporter; Professor at the Catholic University of the Sacred Heart, Milano), Richard Frimston (ELI Project Co-Reporter; Consultant, Russell Cooke), Philippe Lortie (First Secretary, Hague Conference on Private International Law (HCCH)), Pascal Pichonnaz (ELI President; Professor, Faculty of Law of the University of Fribourg), Geraldo Ribeiro (Chair of the HCCH Working Group charged with drafting a practical handbook on the Hague Convention of 13 January 2000 on the International Protection of Adults), Salla Saastamoinen (Director for civil and commercial justice, DG JUST, European Commission) and Adrián Vázquez Lázara (Member of the European Parliament; JURI Committee Chair).

The webinar will also feature a 20–25 minute Q&A session with attendees.

Attendance is free. The registration form is available here.

French Textbooks on Private International Law

Fri, 12/03/2021 - 08:01

Two texbooks on French private international law were recently published in a new edition.

Prof. Bernard Haftel (University Sorbonne Paris Nord) is the author of a short text (375 p.) presenting concisely French private international law in the series Cours Dalloz. The book (and the series) are meant to offer a accessible yet complete treatment of the field. The book covers jurisdiction, foreign judgments and choice of law. It is divided in two parts: a general part and a special part presenting personal status, property, obligations and property aspects of family law (matimonial property regimes and succession).

For more details, see here.

Prof. Sandrine Clavel (University Paris Saclay) is a the author of a longer text (700 p.) also presenting French private international law in another series of the same publisher, Hypercours Cours & TD. It is designed to support students not only in the context of the lectures (Cours), but also in the context of the small classes associated with the lecture that they may choose to follow (Travaux dirigés, ‘TD‘). The book contains a comprehensive treatment of the field distinguishing between general theory of choice of law (Part I) and of international civil procedure (Part II) and rules applying more specifically to natural persons, family, legal persons, property, contracts and torts (Part III). But the book also contains numerous exercises and teaching tools meant to assist students, in particular in the context of travaux dirigés. These tools range from definitions, summaries of French and European leading cases and multiple choice questionnaires, to exams, including 26 with a full correction. The exams include case commentaries (an exercise very peculiar to French legal education), essays and practical exercises.

For more details, see here.

First Meeting of EAPIL Working Group on International Property Law

Thu, 12/02/2021 - 08:00

From November 15 to 17, the members of the Working Group on International Property Law held a first meeting in Würzburg. Everyone was warmly welcomed by the chair of the working group, Eva-Maria Kieninger. The group assembled in a hybrid way, so that members who could not join in person, had the opportunity to participate online. This very first meeting already led to fruitful discussions and successful results.

The three-day meeting was kicked off by all members presenting the rules on international property law of their own country, as well as other countries. Statutory provisions and case law were discussed. The national reports covered the jurisdictions of Belgium, France, England, Germany, Hungary, Luxembourg, the Netherlands, the Nordic countries (Denmark, Finland, Iceland, Norway, and Sweden), Poland, Portugal, and Scotland.

The members spent the rest of their time in Würzburg discussing several specific topics, relevant for the project. They debated inter alia on the specific nature of cultural goods, the ambit of party autonomy in the context of immovable security rights, the influence of the free movement rules on international property law, several possibilities to solve the conflit mobile problem for movables, and whether Article 345 TFEU can form an obstacle for a future Regulation on international property law.

More details on the Working Group can be found here.

December 2021 at the Court of Justice of the European Union

Wed, 12/01/2021 - 08:00

As far as PIL is concerned, December 2021  at the CJEU starts with AG M. Campos Sánchez-Bordona’s opinion on C-645/20, VA and ZA, scheduled Thursday the 2nd. The request for a preliminary reference, from the French Cour de Cassation, focuses on the ex officio application of Article 10 of Regulation 650/2012:

“Must Article 10(1)(a) of Regulation (EU) No 650/2012 of the European Parliament and of the Council of 4 July 2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession be interpreted as meaning that, where the habitual residence of the deceased at the time of death is not located in a Member State, the court of a Member State in which the deceased had not established his habitual residence but which finds that the deceased had the nationality of that State and held assets in it must, of its own motion, examine whether it has subsidiary jurisdiction under that article?”

The appointed judges are  E. Regan, I. Jarukaitis, M. Ilešič, D. Gratsias, and Z. Csehi, with M. Ilešič acting as reporting judge.

An opinion on Regulation (CE) n° 261/2004 is expected one week later, this time by AG A. Rantos. The question in C-561/20, United Airlines, was referred by the Nederlandstalige Ondernemingsrechtbank Brussel (Belgium). In the case at hand, the applicant (on the merits) disputes the applicability of Regulation No 261/2004 in the event of a long delay to a flight departing from, and arriving in the territory of the United States of America, even where that flight is the last flight of two directly connecting flights, the first of which departs from an airport in the territory of a Member State. The questions read as follows:

“Should Article 3(1)(a) and Article 7 of Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91, as interpreted by the Court of Justice, be interpreted as meaning that passengers are entitled to financial compensation from a non-Community air carrier when they arrive at their final destination with a delay of more than three hours as a result of a delay of the last flight, the place of departure and the place of arrival of which are both situated in the territory of a third country, without a stopover in the territory of a Member State, in a series of connecting flights commencing at an airport situated in the territory of a Member State, all of which have been physically operated by that non-Community air carrier and all of which have been reserved in a single booking by the passengers with a Community air carrier which has not physically operated any of those flights?

If the first question is answered in the affirmative, does Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91, as interpreted in the first question, infringe international law and, in particular, the principle of the exclusive and complete sovereignty of a State over its territory and airspace, in making EU law applicable to a situation taking place within the territory of a third country?”

The deciding chamber is integrated by judges C. Lycourgos, S. Rodin, J.C. Bonichot, L.S. Rossi, and O. Spineanu-Matei. S. Rodin will act as reporting judge.

On the same day, a chamber of three judges, namely Jääskinen, Safjan (reporting), and Gavalec, will deliver its judgement on C-708/20, BT, a set of questions from the County Court at Birkenhead on Article 13 (3), of the Brussels Ibis Regulation. The referral was made on December 30, 2020.

  1. Is it a requirement of Article 13(3) of the Regulation (EC) No. 1215/2012 that the cause of action on which the injured party relies in asserting a claim against the policy holder/insured involves a matter relating to insurance?
  2. If the answer to (a) is “yes”, is the fact that the claim which the injured party seeks to bring against the policy holder/insured arises out of the same facts as, and is being brought in the same action as the direct claim brought against the insurer sufficient to justify a conclusion that the injured party’s claim  is a matter relating to insurance even though  the cause of action between the injured party and the policy holder/insured is unrelated to insurance?
  3. Further and alternatively, if the answer to (a) is “yes”, is the fact that there is a dispute between the insurer and injured party concerning the validity or effect  of the insurance policy sufficient to justify a conclusion that the injured party’s claim is a matter relating to insurance?
  4. If the answer to (a) is “no”, is it sufficient that the joining of the policy holder/insured to the direct action against the insurer is permitted by the law governing the direct action against the insurer?

No opinion precedes this judgement in spite of the novelty of the questions.

The decision on C-242/20, HRVATSKE ŠUME will be delivered as well on December 9, 2021. The request was referred by the Visoki trgovački sud Republike Hrvatske (cour d’appel de commerce, Croatie). The questions, still on the Brussels I Regulation, were asked in the context of a dispute between a company incorporated under Croatian law, and a company established in Hamburg (Germany), over a sum of money seized on the bank account of the first company and transferred to the assets of the second as part of an enforcement procedure. As this procedure was subsequently invalidated, the applicant in the main proceedings seeks restitution of the sum in question on the basis of unjust enrichment:

  1. Do actions for recovery of sums unduly paid by way of unjust enrichment fall within the basic jurisdiction established in Council Regulation (EC) No 44/2001 … in respect of ‘quasi-delicts’, since Article 5(3) thereof provides inter alia:: ‘A person domiciled in a Member State may, in another Member State, be sued … in matters relating to … quasi-delict, in the courts for the place where the harmful event occurred or may occur’?
  2. Since there is a time limit on seeking recovery of sums unduly paid in the same judicial enforcement proceedings, do civil proceedings which have been initiated fall within exclusive jurisdiction under Article 22(5) of Council Regulation (EC) No 44/2001 … which provides that in proceedings concerned with the enforcement of judgments, the courts of the Member State in which the judgment has been or is to be enforced is to have exclusive jurisdiction, regardless of domicile?

On September 8, 2021 Advocate general Saugmandsgaard Øe proposed to answer that Article 5 (1) and Article 5 (3) of the Regulation No 44/2001 must be interpreted as meaning that a claim for restitution based on unjust enrichment:

– does not fall within the “contractual matter”, within the meaning of the first provision, except when it is closely linked to a previous contractual relationship existing, or supposed to exist, between the parties to the dispute, and

– does not fall within the “tort or quasi-tort”, within the meaning of the second provision.

(NoA: the English translation of the opinion is not yet available).

The judges in charge are K. Jürimäe (reporting), S. Rodin and N. Piçarra

Next relevant date for the purposes of this blog will be Thursday 16th, with the publication of AG P. Pikamäe’s opinion on C-568/20, H Limited. The question was sent to the Court by the Oberster Gerichtshof (Austria), on a dispute related to the enforcement of an order based on a decision of the High Court of Justice, Business and Property Courts of England & Wales, Commercial Court (QBD):

  1. Are the provisions of Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (‘Regulation No 1215/2012’), in particular Article 2(a) and Article 39, to be interpreted as meaning that a judgment that is to be enforced exists even if, in a Member State, the judgment debtor is obliged, after summary examination in adversarial proceedings, albeit relating only to the binding nature of the force of res judicata of a judgment given against him in a third State, to pay to the party who was successful in the third State proceedings the debt that was judicially recognised in the third State, when the subject matter of the proceedings in the Member State was limited to examination of the existence of a claim derived from the judicially recognised debt against the judgment debtor?
  2. If question 1 is answered in the negative: Are the provisions of Regulation No 1215/2012, in particular Articles 1, 2(a), 39, 45, 46 and 52, to be interpreted as meaning that, irrespective of the existence of one of the grounds set out in Article 45 of Regulation No 1215/2012, enforcement must be refused if the judgment under review is not a judgment within the meaning of Article 2(a) or Article 39 of Regulation No 1215/2012 or the application in the Member State of origin on which the judgment is based does not fall within the scope of Regulation No 1215/2012?
  1. If the first question is answered in the negative and the second question in the affirmative: Are the provisions of Regulation No 1215/2012, in particular Articles 1, 2(a), 39, 42(1)(b), 46 and 53, to be interpreted as meaning that, in proceedings concerning an application for refusal of enforcement, the court of the Member State addressed is compelled to assume, on the basis solely of the information provided by the court of origin in the certificate issued pursuant to Article 53 of Regulation No 1215/2012, that a judgment that falls within the scope of the regulation and is to be enforced exists?

The deciding chamber will be one of five judges: K. Jürimäe, N. Jääskinen, N. Piçarra, M: Gavalec, and M. Safjan in the role of reporting judge.

Just for the record: the decision on C-490/20, Stolichna obshtina, rayon „Pancharevo“, is expected on December 14th. AG J. Kokott’s opinion was published last April (for a summary click here).

Law Commission of England and Wales’s New Project on Conflict of Laws and Emerging Technology

Tue, 11/30/2021 - 08:00

The author of this post is Burcu Yüksel Ripley, who is a Senior Lecturer in law and the Director of the Centre for Commercial Law at the University of Aberdeen.

On 25 November 2021, the Law Commission of England and Wales announced, as part of an update on its work on smart contracts, that it has agreed with the Government to undertake a project on conflict of laws and emerging technology. This project will look at conflict of laws rules as they apply to emerging technology (including smart legal contracts and digital assets) and consider whether law reform is required. The Commission hopes to be able to begin work in the first half of 2022.

Conflict of laws and emerging technology was among the ideas for potential areas of law reform within the scope the Law Commission’s 14th programme of law reform. In the area of commercial and common law with a focus on emerging technology, the Commission has been working on three projects on smart contracts, digital assets and electronic trade documents which are, to some extent, interconnected. Its work on these projects has identified certain difficulties with the application of conflict of laws rules (covering both jurisdiction and applicable law rules in this context) in relation to emerging technology, including distributed ledger technology (DLT):

  • In the context of its work on smart contacts, which the Commission concluded with a confirmation that the existing law of England and Wales is able to accommodate and support smart legal contacts, it devoted Chapter 7 of its advice to Government on smart legal contacts (published on 25 November 2021) to ‘Jurisdiction and smart legal contracts’. The Commission considered various issues concerning jurisdiction and applicable law in relation to smart contacts and assessed that “the problem of digital location – that is, the difficulty of ascribing real-world locations to digital actions and digital objects – is amongst the most significant challenges that private international law will have to overcome in relation to emerging technology, including smart legal contracts.” (see paragraph 7.145 of the advice).
  • In the context of its work on digital assets, which seeks to support and facilitate the development of digital assets and ensure that the law recognises and protects them in a digitised world, conflict of laws is mentioned in the call for evidence (published on 30 April 2021) as an area which is likely to be affected by the issues covered by the call for evidence. The Commission therefore sought to hear more details from respondents on conflict of laws issues relating to digital assets (see para 2.80 of the call for evidence on digital assets). The digital assets project is currently at the pre-consultation stage, with the expectation that the consultation paper will be published in mid-2022. An interim update paper on this project is available here.
  • In the context of its work on electronic trade documents, which seeks to make recommendations for law reform to allow for legal recognition of electronic trade documents (eg bills of lading and bills of exchange), some conflict of laws issues relating to electronic trade documents were highlighted in the consultation paper (published on 30 April 2021, see in particular pp.124-127 of the consultation paper on digital assets: electronic trade documents). There were two main questions specifically mentioned in the consultation paper: 1) “Where is an electronic trade document located at any given time (and related questions such as where does a transfer take place)?” and 2) “How will an electronic trade document issued in England and Wales be treated in a country that does not recognise the validity of electronic trade documents?”. The Commission, in this consultation paper, provisionally proposed to consider the private international law aspects of digital assets, including electronic trade documents, as part of a separate project that could be taken as part of its 14th programme of law reform. The electronic trade documents project is currently at the policy development stage.

The Commission’s new project on conflict of laws and emerging technology is a very timely project. The Law Commission of England and Wales can only make recommendations for the law of England and Wales. However, some of its recommendations might have a UK-wide impact. This project should also be seen as an opportunity to help facilitate the development of internationally widely accepted private international law rules in relation to emerging technology given the current work of the Hague Conference on Private International Law concerning private international implications of the digital economy, including DLT and its applications (including digital assets).

Call For Papers and Panels: Identities on the Move – Documents Cross Borders

Mon, 11/29/2021 - 08:00

DXB – Identities on the move – Documents cross borders is a project aimed at facilitating the dissemination and implementation of Regulation (EU) 2016/1191 in EU Member States, funded by the European Union’s Justice Programme (2014–2020).

The final conference of the project will take place on 23–24 June 2022 in Castel San Pietro Terme, Bologna (Italy), at the premises of ANUSCA’s Academy (ANUSCA is the Italian association of civil status officers)

A call for papers and panels has been launched. All interested will find more information here.

Papers or panel abstract proposals shall be submitted by 22 December 2021.

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