Conflict of Laws .net

Following our post on the note from the Luxembourg delegation relating to consumer contracts, a number of new interesting documents on the Rome I Proposal have been made publicly available on the Register of the Council.

Here’s a brief presentation:

- doc. n. 8022/07 ADD 1 REV 1 of 13 April 2007, containing a “compromise package” prepared by the German Presidency for the JHA Council session of 19-20 April 2007 (see our related post on the Council conclusions). The text focuses on Articles 3 (Freedom of choice), 4 (Applicable law in the absence of choice) and 6 (Individual employment contracts). Art. 7 on contracts concluded by an agent is deleted; other important issues, such as contracts of carriage (art. 4a), consumer contracts (art. 5), insurance contracts (art. 5a) and overriding mandatory provisions (art. 8 ) do not form part of the compromise;

- doc. n. 8935/1/07 REV 1 of 4 May 2007, on insurance contracts. The document provides a draft text of Art. 5a, taking into account the comments submitted in March by the Member States delegations (docs. 6847/07 and ADD 1 to 12, not accessible to the public);

- doc. n. 7418/07 of 15 March 2007, from the Services of the Commission to the Council’s Committee on Civil Law Matters, dealing with certain financial aspects relating to the application of Articles 4 and 5. The document is divided in two parts: the first one addresses the conflict rule on contracts concluded at a financial market (Art. 4(1)(j1)), that was introduced by the Finnish presidency (see doc. n. 16353/06 of 12 December 2006) and confirmed by the German Presidency (see the French text of doc. n. 6953/07 of 2 March 2007), stressing the importance of a specific provision on stock exchange transactions:

The reason for including a specific provision for trading systems relates, in particular, to the fact that regulated markets, multilateral trading facilities and other similar trading systems need to operate under a single law. It is essential that all transactions are carried out in accordance with the governing law of the system. The application of a single governing law is an intrinsic feature of organised multilateral trading systems and necessary for legal certainty for the market participants.

These transactions concluded within such a trading system include contracts of buying, selling, lending and other such dealings in financial instruments. Contracts for the provision of services between a financial intermediary and a client are not concluded within these trading systems.

The transactions in question are closely connected to the market concerned and it is appropriate and, indeed, necessary that the same law governs them irrespective of the nature of the parties to the transactions (consumer/professional) and the place where the parties have their habitual residence. Any other result would mean that the systems could not operate.

Problems arising from the definition of “financial market” are then addressed, in the light of the Directive 2004/39/EC (MiFID - Markets in Financial Instruments Directive), and an improved draft of the provision is proposed:

[T]he use of the term “financial market” in this provision leads to undesirable uncertainty. There is no definition of this concept in any community instrument. The term is used in the particular context of Article 9 of the Insolvency Regulation but it is not defined. In the framework of a general conflict of law rule in Rome I this expression would lack precision and create legal uncertainty. Given the extreme diversity and complexity of the financial sector activities, there is a need to define all relevant concepts used.

Taking into account the universal scope of application of Rome I (Art. 2), the definition of markets and trading systems by reference to the EU regulatory categories in Directive 2004/39/EC (MiFID) has been avoided. This is because cross-reference to the MiFID concepts would limit the provisions to an EU context. Instead, the proposed draft contains a functional description of multilateral system that uses the common elements of the definitions of regulated market and multilateral trading facility in MiFID, together with the condition that such systems should be subject to a single governing law. This description will cover all the equivalent non-EU trading facilities that need to be caught.

The second part deals with possible overlaps between the scope of application of the protective rule on consumer contracts (Art. 5 of the Rome I Proposal) and the legal regime of financial instruments (rights and obligations which comprise a financial instrument, contracts to subscribe for or purchase a new issue of transferable securities, contracts concluded within the type of system falling within the scope of the above mentioned Article 4(1)(j1)):

All these issues are not covered by Art. 5 of the Rome Convention as that Article only applies to contracts for the provision of services and sale of goods. The questions […] only arise due to the enlarged scope of Article 5 of the Rome I proposal.

The proposed text does not exclude contracts for the provision of financial services generally nor does it exclude contracts for the sale of shares and bonds concluded outside the systems referred to in the draft Art. 4(1)(j1).

As regards financial instruments, on the assumption that the exclusion from the scope of the Rome I proposal of financial instrument under Art. 1(2)(d) may not be exhaustive it is absolutely necessary to provide for this exclusion since without it the actual nature of a financial instrument - the rights and obligations that constitute its essence - could change by virtue of the application of Article 5. […]

Without an amendment to this effect, the actual nature of a financial instrument and the rules of law governing it could be various and unpredictable and would depend on the habitual residence of the person holding it. This question should not be confused with contracts for the provision of financial services. For example, when a bank sells to a consumer shares from company x it is providing a financial service. The consumer friendly rule of Article 5 of the proposal will naturally continue to apply to all these contracts that were already covered by Article 5 of the Rome Convention.

As regards the subscription for shares and units in collective investment schemes, and purchase of new issues of debt, it is important that the issuer in relation to a single issue is not faced with a risk of application of multiple laws depending on the habitual residences of investors. This would effectively prevent cross-border retail offerings of shares, debt, etc. Contractual rights and obligations in relation to the subscription for or purchase of new issues of transferable securities will not necessarily be covered by the narrowly focussed exclusion discussed above for contracts which comprise financial instruments. […]

Thus, on the assumption and to the extent that this issue is not excluded entirely from the scope of the Regulation by virtue of Art. 1(2)(f) (exclusion of contracts governed by company law) it is necessary to ensure in relation to contracts of subscription for or purchase of a new issue of shares, bonds and other transferable securities that Article 5 does not apply.

As a last point, the Services of the Commission point out another possible inconsistency between Art. 5 of the Rome I Proposal and the MiFID Directive (2004/39/EC), as regards individual investors who act as “professional clients” under Annex II to the Directive, but may be still considered as consumers for the purposes of the protective conflict rule:

Finally, the Committee may wish to consider an amendment to the text or at least a recital in order to clarify that individuals who ‘opt up’ to professional status under MiFID should not be treated as consumers for the purposes of Art. 5. Annex II to MiFID allows clients of investment firms, who would otherwise be classified as “retail clients” to be treated as “professional” clients if they meet specified conditions aimed at establishing that that client is financially sophisticated and experienced in investment. However, such clients may be considered to fall within the category of “consumers” for the purposes of Art. 5. The point is important since firms would be most unlikely to let sophisticated individuals opt up to professional status if Art. 5 were to apply to their dealings, and accordingly the objectives of the MiFID in this respect would be thwarted.

A very interesting article on Rome II written in German by Thomas Thiede and Katarzyna Ludwichowska (both Vienna) has been published recently in the “Zeitschrift für vergleichende Rechtswissenschaft” (106 ZVglRWiss (2007), 92 et seq.):

“Die Haftung bei grenzüberschreitenden unterlaubten Handlungen” (Liability for cross-border torts).

An abstract has kindly been provided by the authors:

The article is a critical analysis of a proposal to apply the law of the victim’s place of habitual residence to the compensation for personal injuries arising out of tort. The proposal, which was introduced by the European Parliament in the course of work on the EU regulation on the law applicable to non-contractual obligations (Rome II), originally concerned only traffic accidents, but was later modified and extended to all personal injury cases. The authors of the article show the proposal of the European Parliament against the background of solutions accepted in Germany and England. They present the arguments given by the supporters of the proposal and then proceed to strongly criticise the parliamentary solution, inter alia by showing the negative consequences of splitting an otherwise uniform legal relationship as a result of subjecting the prerequisites of liability and part of its consequences (compensation for damage to property) to lex damni and the other part of the consequences of liability (compensation for personal injuries) to the law of the victim’s place of habitual residence.

In Impulsora Turistica de Occidente v. Transat Tours Canada Inc. (available here) the Supreme Court of Canada has, in brief reasons, dismissed an appeal from the Quebec Court of Appeal.  Transat sued four Mexican companies in Quebec, seeking an extraterritorial injunction against them.  The companies successfully resisted the injunction and also convinced the judge at first instance to conclude both that Quebec lacked jurisdiction and that in any event Mexico was the more appropriate forum.  On appeal, now confirmed by the Supreme Court of Canada, the decision on jurisdiction was reversed.  The Quebec court had jurisdiction and no stay of proceedings was warranted.

The court held Quebec had jurisdiction even in respect of a request for purely extraterritorial relief.  The court was able to consider granting injunctive relief against defendants who were not within the province.

The court also held that Mexico was not the more appropriate forum, in part based on a jurisdiction clause in the contract between Transat and one of the four Mexican companies.

It is somewhat unusual for the Supreme Court of Canada to grant leave to hear a case and then render only brief unanimous reasons adopting the reasoning of the court below.

Since Transat did not appeal the initial denial of its motion for an injunction, its success on appeal resulted in the case being returned to the Superior Court for possible further proceedings.

The Australian Attorney-General and New Zealand Associate Justice Minister have recently announced that their respective governments will implement, by way of a bilateral treaty, the recommendations of the Trans-Tasman Working Group report on Court Proceedings and Regulatory Enforcement. That report was released in December 2006 and recommended that there be closer co-operation between the two countries in civil proceedings, especially as regards matters of jurisdiction and enforcement of judgments.

The Working Group’s central recommendation was that a ‘trans-Tasman regime’, modelled on the Service and Execution of Process Act 1992 (Cth), be introduced as between the two countries. The report went on to recommend that:

• The defendant’s address for service could be in Australia or New Zealand, and parties in one country should be able to appear in court in the other by telephone or video link.
• The test for stay of proceedings should be on the basis that a court in the other country is the “more appropriate” court for the proceeding. This contrasts with the “clearly inappropriate” test for forum non conveniens that currently applies in Australia. Anti-suit injunctions will no longer be available as between Australia and New Zealand.
• Appropriate Australian and New Zealand courts should be given statutory authority to grant interim relief in support of proceedings in the other country’s courts, such as Mareva and Anton Piller orders.
• A judgment from one country could be registered in the other. It would have the same force and effect, and could be enforced, as a judgment of the court where it is registered. Final non-money judgments such as injunctions will also be registrable.
• A judgment could only be refused enforcement in the other country on public policy grounds. Other grounds, such as breach of natural justice, would have to be raised with the original court. Currently, the grounds for non-enforcement of New Zealand judgments under the Foreign Judgments Act 1991 (Cth) are wider.
• The common law rule that an Australian or New Zealand court will not directly or indirectly enforce a foreign public law should not apply to the enforcement of judgments under the Trans-Tasman scheme. Thus, civil pecuniary penalties from one country should be enforceable in the other unless specifically excluded, and criminal fines imposed for certain regulatory offences in one country should be enforceable in the other in the same way as a civil judgment debt.

The proposals apply to in personam civil matters; actions in rem are excluded, as are matters covered by existing multilateral agreements such as those regarding the dissolution of marriage and enforcement of maintenance and child support obligations. The Working Group made no recommendation about the Mozambique rule as it applies to foreign land, preferring to leave this matter to independent domestic reform in the respective countries.

A note from the Luxembourg delegation on the Proposal for a Regulation on the law applicable to contractual obligations (”Rome I“) which has appeared on the agenda for the Competitiveness Council meeting on 21 and 22 May 2007 deals rather critically with Article 5 of the planned regulation.

Here an excerpt:

The Luxembourg Government is very concerned about the negative impact on competitiveness of the instruments of private international law which are currently being converted into Community instruments. In particular, it would like to draw the attention of the Competitiveness Council to the proposal for a Regulation on the law applicable to contractual obligations (”Rome I”, 6935/07), which is currently under discussion in the Justice and Home Affairs Council.

Article 5 of the proposal has the effect, in certain cases, of depriving the parties of the freedom to choose the law applicable to business-to-consumer cross-border contracts. This changes the current situation under the Rome Convention, which lays down different protective rules and reflects a fair balance between the needs of businesses and those of consumers. This substantial change would have warranted an impact assessment by the Commission. However, the economic impact of this proposal has not been evaluated. Its consequences for the internal market and for consumers have not been analysed.

[…]

With a view to the Justice and Home Affairs Council meeting on 12 and 13 June 2007, it would be appropriate for the authorities concerned in all the Member States to be made aware of the negative consequences of this proposal for the internal market, for businesses and for European consumers. No decision should be taken which prejudices competition. In this context the Luxembourg delegation would recall the instruction given by the European Council in March 2003 that “the Competitiveness Council should be effectively consulted within the Council’s decision-making processes on proposals considered likely to have substantial effects on competitiveness”.

The complete note can be found here.

Many thanks to Dr. Jan von Hein, MPI Hamburg for the tip-off.

The British Institute of International & Comparative Law (see information about the Institute here) is looking to recruit a new Director.

The Institute, the UK’s leading centre for the advancement of the understanding and practical application of international law, will celebrate its 50th Anniversary in 2008. The present Director, Professor Gillian Triggs, will be returning to Australia shortly to take up the post of Dean of the Law School at the University of Sydney, and the Institute is now seeking a dynamic individual with global vision as her successor.

The Institute, a community of legal scholars and practitioners, is an independent charitable body which seeks to support the international rule of law in global problem-solving, to foster a comparative understanding of all national legal systems, and to provide a forum for public debate on international law through its well-established research, events and publications, of which its best known is the International and Comparative Law Quarterly. The Institute’s unique strength is to combine a diverse community of scholars with practitioners in the world’s leading legal marketplace. It serves as an unrivalled focal point for its substantial membership.

Following a period of dramatic growth in the range and depth of its work, the Institute has consolidated its leading position and reputation. It aims to combine the highest standards of scholarship with a high degree of practical relevance for the world of the 21st century. The research staff of the Institute undertakes a wide range of work, including major research projects for a variety of government and private bodies, which seek to address
some of the key issues which have become of increasing public interest - such as the establishment of the rule of law in post-conflict states, international humanitarian law, international trade, the World Trade Organisation and global poverty, and evidence before international courts and tribunals.

The Institute’s work ranges across public and private international law, comparative law, European law and human rights. Research is currently streamed into the following 3 programmes:

• International Law programme
• Law and Development programme
• European and Comparative Law programme

Within these programmes there are a number of specialist practitioner groups enabling the members of the Institute to discuss current issues at an expert level. The Director, who reports to the Board of Trustees, has overall responsibility for the Institute’s activities, including shaping its research programme and directing its research, managing its staff of some 30 academics, interns and administrators, and representing the Institute externally to government, the legal profession, corporations, non-governmental organisations and the public. In all probability the successful candidate will have a background in law, but could have experience in government, public bodies or other institutions. Candidates should feel comfortable representing the Institute in public and in the media, working with the Institute’s Development Director in attracting major funding for its programmes, and have a proven record in managing people and organisations.

A competitive salary is offered, which, depending on age and experience, is likely to be at the upper end of the UK academic range. Written applications with full curriculum vitae and the names of three referees should be made in confidence to: Ruth Eldon, Institute Secretary, BIICL, 17 Russell Square, Charles Clore House, London WC1B 5JP. Tel. + 44 (0) 20 7862 5151. For further particulars e-mail: r.eldon@biicl.org. For more information on BIICL’s activities see www.biicl.org. Applications should be received by 22 June 2007. First interviews will be conducted shortly thereafter.

Following the agreement on a joint text of the Rome II Regulation reached in the first meeting of the Conciliation Committee, on 15 May (see our post here), Diana Wallis MEP, Rapporteur on Rome II in the European Parliament, has held a press conference to comment the successful outcome of the negotiations.

Excerpts from Mrs Wallis’ statements have been published on her website and on the website of her political group, ALDE (Alliance of Liberals and Democrats for Europe):

Speaking after last night’s Conciliation meeting between the three EU institutions to hammer out the final text on the Rome II Regulation (the law applicable to non-contractual obligations), the European Parliament’s Rapporteur, Diana Wallis MEP, proclaimed it ‘a first’ - in many senses.

Diana Wallis said, “This is the first time that the EU has put into a Regulation an extensive area of private international law where there was previously no pre-existing international Convention. It is the first time that the European Parliament has had co-decision in this area of civil law - moreover certainly a first in terms of conciliation. Also, a new experience for all the institutions involved in the process - the European Parliament has left its clear mark on the final text agreed last night.”

Diana Wallis was particularly pleased with the result on road traffic accidents, often involving personal injury - the most common and frequent form of tort (non-contractual obligation) that touches the lives of many citizens as they go about their business and leisure pursuits across Europe. She went to say, “The European Parliament has underlined the right of citizens to be fully reimbursed for their loss in such cases despite the national differences in compensation levels, whatever country they come from, whilst also extracting from the Commission a full study in the area by 2008 that ‘would pave the way for a Green paper’.”

“The European Parliament has also sought to introduce some further clarity into the fuzzy thinking as to the relationship between this Regulation relating to choice of law rules and other Internal Market instruments such as the e-commerce Directive. We have certainly ended in a better position than where we started from.”

Diana Wallis welcomed the fact that the Conciliation was also instructive in bringing together three different Commission departments around the table to support the same text in relation to a number of issues. “This coherent joint working across the area of civil and commercial law is to be much welcomed and better late than never.”

Finally Diana Wallis concluded that: “The European Parliament has left its imprint on several other issues, including party autonomy and flexibility to the general rule. It also insisted on several studies being undertaken by the Commission, notably on defamation and the treatment of foreign law, which may leave the way open for future legislation.”

Mrs Wallis’ focus on the role of the European Parliament in drafting legislation in the field of judicial cooperation in civil matters has been stressed several times (on Rome II, see our posts here and here), and it is particularly meaningful since at present she is perhaps the most influential MEP involved in the legislative process of EC private international law instruments: she is shadow rapporteur, appointed by the ALDE group, for Rome I, and draftswoman on the maintenance regulation (see her Draft opinion on the Commission’s proposal here).

As regards substantive law, she has been draftswoman for the Internal Market and Consumer Protection Committee (IMCO) for the opinion on the Commission Communication “European Contract Law and the revision of the acquis: the way forward”, and has prepared for the JURI Committee a Draft report with recommendations to the Commission on limitation periods in cross-border disputes involving injuries and fatal accidents.

Mathias Audit, Horatia Muir-Watt and Etienne Pataut are hosting a conference in Paris on 22 - 23 June 2007 on “Conflict of Laws and Economic Regulation” (Colloque Conflit de Lois & Régulation économique).

Speakers include Paul Lagarde (Paris I) and Diana Wallis (European Commission) - a full list of speakers, and all of the details on time, place and registration can be found in the programme (PDF, 3mb).

An article by Symeon C. Symeonides (Willamette University College of Law, Salem, Oregon) on the life and work of Arthur Taylor von Mehren, who has passed away on January 16, 2006, has recently been published in English in the German law journal “Praxis des Internationalen Privat- und Verfahrensrechts” (IPRax 2007, 261).

Here is a short excerpt:

As noted by his colleagues, Arthur was a “pure scholar”, a “scholar’s scholar”, with “astonishing depth and range” and “a mind ever restless for new territory to explore.” His published work spans the entire field of comparative law, both public and private, all branches of private international law (jurisdiction, choice of law, and recognition of judgments), as well as international commercial arbitration. He authored or co-authored 210 publications: ten books, four monographs, 119 articles, 48 book reviews (the most unselfish form of scholarship), and 29 reports and other writings. Most of them were published in English, but several were published in French and German, which Arthur spoke fluently, as well as in Spanish, Italian and Japanese.

As stated on press releases published by the Council and the Commission (DG Freedom, Security and Justice), an agreement has been reached on the text of the Rome II Regulation, during the first official meeting of the Conciliation Committee that was held yesterday evening (the Conciliation Committee had been convened, pursuant to Art. 251(3) of the EC Treaty, after the formal rejection by the Council of the Parliament’s Legislative resolution at second reading: for further details on the steps of the complex procedure that has lead to the agreement, see the Rome II section of our site).

According to a statement by Diana Wallis, Rapporteur on Rome II in the European Parliament, prior to the official meeting of yesterday the institutions involved in the codecision procedure (Council and Parliament, the Commission playing a mediating role) had held six informal meetings in order to facilitate the negotiations (so called “trialogues”: for an overview of the conciliation stage, see the “codecision” section of the Commission’s website).

The content of the agreement is summarized as follows in the Council’s press release, with particular reference to the controversial issues (that were emphasized by the Commission in its opinion on the EP Second reading):

As a general rule, the draft Regulation sets out that the law applicable to a tort/delict is the law of the country where damage occurred. Only in certain limited, duly justified circumstances, the general rule will be derogated from and special rules applied. The draft Regulation contains special rules in matters of product liability, unfair competition, environmental damage, infringements of intellectual property and industrial action. In the context of a global compromise package, the Conciliation Committee settled all the questions arising from the amendments adopted by the European Parliament in second reading.

The agreement includes notably:

Violation of privacy or rights relating to the personality:

While it was agreed that legal actions connected with those rights will be excluded from the scope of this Regulation, the Commission was asked through a review clause to present, not later than 31 December 2008, a study on the situation in the field of the law applicable to non-contractual obligations arising out of violations of privacy and rights to relating to personality, taking into account rules relating to freedom of the press and freedom of expression in the media. Violations of privacy resulting from the handling of personal data will be also dealt with in the Commission’s study.

Damages in personal injury cases:

This question arises primarily in connection with traffic accidents which have connection with more than one State. In particular, the issue of the quantification of damages in personal injury cases was discussed. The solution agreed provides, on the one hand, for a recital with criteria for the quantification of damages to be applied by judicial authorities in accordance with national compensation rules. On the other hand, the Commission undertook to examine the specific problems resulting for EU residents involved in road traffic accidents in a Member State other than the Member State of their habitual residence and to prepare a study on all options before the end of 2008. This study would pave the way for a Green Paper.

Unfair competition and acts restricting free competition:

A compromise solution was found. It will allow for the application of one single law, while at the same time limiting, as far as possible, “forum shopping” by claimants.

Foreign law:

The Commission will prepare a study on the effects on the way in which foreign law is treated in the different jurisdictions and on the extent to which courts in the Member States apply foreign law in practice pursuant to this Regulation.

Other issues that were settled by the Conciliation Committee concern the relationship with other Community law instruments, the definition of environmental damage for the purposes of this Regulation, and a provision on punitive damages in the context of public policy.

The consolidated text resulting from the agreement (so called “joint text”) is not yet available, subject to legal linguistic revision: however, technical details on the joint text are provided by the statement released by Diana Wallis on her website, with specific reference to the amendments adopted by the European Parliament at second reading on the basis of the Council’s common position.

Once the linguistic revision completed, the Regulation shall be endorsed by the Parliament (absolute majority of votes cast) and the Council (qualified majority voting procedure) to be adopted, within six weeks from the date of approval of the joint text, pursuant to Art. 251(5) of the EC Treaty: the Parliament’s vote is scheduled in the plenary session of 10 July 2007 (see the OEIL page on Rome II).

It is entirely possible that the Regulation will be published in the Official Journal in July 2007 (following the Parliament’s vote in plenary and the expected signature of its President and the Council’s). If no change has been made to the provisions on the application in time, it will start to apply in early 2009 (see art. 32 of the Council’s Common Position), to events giving rise to damage which occur after its entry into force (art. 31; the date of entry into force is on the twentieth day following that of the publication on the O.J., except otherwise specified).

(Many thanks to Andrew Dickinson and Janeen Carruthers for the tip-off, and to Martin George and Edouard Dirrig for providing additional information and clarifications)

In a judgment of 17 April 2007, the Court of first instance of Hasselt found that the exception of fraude à la loi did not apply to the following case: A man from India and a woman from The Netherlands married in Sweden. They had no connection to that country (no friends or family; never lived there). The city where they moved to in Belgium refused to recognise their marriage on the basis of fraude à la loi (arguing that the couple should have married in The Netherlands or in Belgium, and only went to Sweden because of the less stringent requirements regarding documents etc.). The court found that this exception did not apply. In its considerations, the court mentioned that this was not a simulated marriage.

In Belgium a practice has developed whereby the Belgian embassies in foreign countries may attach a ‘warning’ when legalising a document. The most frequent example is for repudiation. The warning note will then indicate to the future receiver of the document that according to the embassy, the document concerns the unilateral dissolution of a divorce.

This practice has been affirmed in an ‘Arrêté royal’ (published in the Moniteur belge of 11 January 2007). In the past the warning could be inserted on the legalisation sticker or on a separate sheet of paper attached to the document and legalisation, but according to the new rules only the last option remains.

It seems that such warning is most often respected in practice. However, strictly speaking the warning is not legally binding, as it is the competence of the authority in Belgium where the document is presented to consider its content and whether it can be recognised.

The Max Planck Working Group has - besides the comments on Rome I (see our older post) - also elaborated “Comments on the European Commission’s Green Paper on Improving the Efficiency of the Enforcement of Judgments in the European Union: The Attachment of Bank Accounts”.

The comments can be found on the MPI’s website and will be published in the European Company and Financial Law Review (issue 2, 2007) in due course.

The Commission’s Green Paper (COM(2006) 618 final) can be found here.

The VIII volume (2006) of the Yearbook of Private International Law (published by Sellier and Staempfli in association with the Swiss Institute of Comparative Law) is expected in June. It contains a huge number of articles, national reports, commentaries on court decisions and other materials, up to nearly 500 pages.

The main section (”Doctrine”) of the volume is devoted to the memory of Prof. Petar Šarčević, who co-founded the periodical in 1999 with Prof. Paul Volken (a biography and list of publications of Prof. Šarčević can be found in the Liber Memorialis dedicated to his memory, published by Sellier in 2006: “Universalism, Tradition and the Individual“, edited by J. Erauw, V. Tomljenović and P. Volken).

A presentation of the new volume is provided by the current editors of the Yearbook, Prof. Paul Volken and Prof. Andrea Bonomi, in the “Foreword”:

The present volume of the Yearbook is a special one for at least two reasons. First, it includes a section devoted to the memory of the Yearbook’s spiritual father, the late Petar Šarčević. […]

This special section features twelve most interesting contributions by colleagues from no less than eleven countries and three continents, thus confirming once again the worldwide reputation of Petar Šarčević and his Yearbook. The papers deal with a wide array of subjects ranging from classical themes such as the protection of children in inter-country adoptions and abduction cases, the principle of comity in United States case law and new national conflict codifications, to very fashionable topics like non-marital unions and same-sex marriages, up to the new challenging questions of the conflict régime of euthanasia and living wills. […]

With the intention of bringing the celebratory aim of the present volume in harmony with the general goals of the Yearbook, we have maintained in the current issue most of our traditional sections. We thus have the pleasure of presenting the reader with several most interesting national reports, as well as commentaries on court decisions and recent developments from various African, Asian and European countries. We will not mention all of them here, but we are pleased to stress that, in line with the purpose of extending with each passing year the Yearbook’s information network, the present volume hosts for the first time contributions from Greece, India, Latvia, Qatar and Tunisia.

In order to make the Yearbook more attractive for practitioners, we have also enlarged the section on national court decisions and included contributions on international arbitration. And last but not least, this year’s ‘Forum’ section summarizes the contents of two excellent doctoral theses on the pending European conflict system. One article analyzes the new system taking into account the scope of application of secondary Community legislation, while the other focuses on the conflict of laws aspects of the ever growing case law of the European Court of Justice.

Here’s the list of articles published in the “Doctrine” section (we highly recommend to browse the whole table of contents of the volume, which is not reproduced here in its entirety):

• Alfred E. von Overbeck: Three Steps With Petar Šarčević (downloadable from the publisher’s website)
• Tito Ballarino: Is a Conflict Rule for Living Wills and Euthanasia Needed?
• Katharina Boele-Woelki, Ian Curry-Sumner, Miranda Jansen, Wendy Schrama: The Evaluation of Same-Sex Marriages and Registered Partnerships in the Netherlands
• Alegría Borrás: Competence of the Community to Conclude the Revised Lugano Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters – Opinion C-1/03 of 7 February 2006: Comments and Immediate Consequences
• Lawrence Collins: The United States Supreme Court and the Principles of Comity: Evidence in Transnational Litigation
• William Duncan: Nationality and the Protection of Children across Frontiers, and the Example of Intercountry Adoption
• Jasnica Garašić: What is Right and What is Wrong in the ECJ’s Judgment on Eurofood IFSC Ltd
• Huang Jin: Interaction and Integration between the Legal Systems of Hong Kong, Macao and Mainland China 50 Years after Their Return to China
• Ulrich Magnus: Set-off and the Rome I Proposal
• Yuko Nishitani: International Child Abduction in Japan
• Yasuhiro Okuda: Reform of Japan’s Private International Law: Act on the General Rules of the Application of Laws
• Robert G. Spector: Same-Sex Marriages, Domestic Partnerships and Private International Law: At the Dawn of a New Jurisprudence in the United States.

The table of contents of the previous volumes of the Yearbook (1999-2005) is available on the website of Sellier - European Law Publisher, in the “Private International Law” section (use the “serial” dropdown menu on the top of the page).

The last issue of the French Revue Critique de Droit International Privé has just been released. It contains two articles, written in French.

The first deals with immigration law, which has traditionally been regarded as part of private international law in France. It is authored by professor Dominique Turpin and presents the last legislative reform in the field.

The title of the second article is “Le Reglement communautaire sur l’obtention des preuves: un instrument exclusif?” (The European Regulation on the Taking of Evidence: an Exclusif Instrument?). It is authored by Belgian professor Arnaud Nuyts. Unfortunately, the author does not provide any abstract.

The latest volume of the German legal journal Rabels Zeitschrift (Vo. 71, No. 2, April 2007) contains “Comments on the European Commission’s Proposal for a Regulation of the European Parliament and the Council on the law applicable to contractual oblitations (Rome I)” (in English) elaborated by the Working Group on Rome I of the Max Planck Institute for Comparative and International Private International Law.

In a recently reported judgment, McKenzie J of the High Court of New Zealand has held that the New Zealand courts can exercise jurisdiction over claims for the infringement of foreign copyright, at least where the defendant is served within the jurisdiction and where the existence and validity of the foreign copyright is undisputed.

The case, KK Sony Computer Entertainment v Van Veen (2006) 71 IPR 179, concerned the sale and distribution in New Zealand, Hong Kong and the UK of a computer program which enabled the user to circumvent the embedded copy protection in Sony PlayStation 2 computer games. The plaintiff alleged breaches of the New Zealand, Hong Kong and UK copyright statutes, and the defendant entered a statement of defence in which he admitted the facts that would make him liable under each of those statutes. Beyond entering that statement, the defendant did not otherwise appear.

McKenzie J entered judgment for the plaintiff. His Honour declined to follow previous New Zealand and Australian authority on the point, and instead applied the English Court of Appeal decision in Pearce v Ove Arup Partnership Ltd [1999] 1 All ER 769. His Honour drew a distinction between cases in which the plaintiff’s title or rights were in dispute (in which the Mozambique rule would apply), and those cases in which the title or rights were undisputed (in which the court would be free to exercise jurisdiction).

His Honour then characterised the copyright infringement as a “wrong”, and then asked whether the double actionability rule in Phillips v Eyre precluded the court from entering judgment for the plaintiffs. The problem was that the infringements of UK and Hong Kong copyright “do not constitute a wrong against New Zealand copyright, since New Zealand copyright is territorial in effect.” The solution, again, was to be found in Pearce v Ove Arup: one simply “effect[s] a notional transfer to New Zealand, for consideration under New Zealand law, of both the infringing act, and the intellectual property right infringed.”

The decision is a curious one in some respects. On the proffered reasoning, what difference did it make that the defendant was resident in New Zealand? And if all jurisdictional complexities could be resolved by a “notional transfer”, why should the court’s jurisdiction be limited to those cases in which the existence of the IP right is undisputed? Cross-border infringement of IP rights is a real and topical problem: whether Sony v Van Veen (or, more importantly, Pearce v Ove Arup) offers a satisfactory response lies very much in the eye of the beholder.

P St J Smart (University of Hong Kong) has written an article in the latest Australian Law Journal (2007 vol 81, p 349) on the question of whether an Australian court may enforce a foreign judgment which is itself founded upon the judgment of another, different foreign court. The abstract continues:

The enforceability of a so-called “judgment on a judgment” has been canvassed by academic writers and has the support of at least one recent case (albeit not in an Australian court). Yet this commentator suggests that an Australian court should not enforce the judgment of an intermediary foreign court because such judgment will not meet the requirement that it is a decision on the merits of the parties’ dispute.

The article takes as its starting point the recent Hong Kong decision in Morgan Stanley & Co International Ltd v Pilot Lead Investments Ltd [2006] 4 HKC 93; [2006] HKCFI 430, which concerned the enforcement in Hong Kong of an Singaporean order which was in turn based upon the registration of an English judgment.

The article is available on the internet to Lawbook Online subscribers.

In a recent post, I presented two 2006 judgements of the French supreme court for private matters (cour de cassation) on the application of Article 5 (1)(b) to distribution contracts. The Cour de cassation had held twice that the distribution contracts were Contracts for the Provision of Services in the meaning of article 5.

On January 23, 2007, the same court held in Waeco that another kind of distribution contract, a concession exclusive (exclusive concession in English?) was neither a Sales of Goods, nor a Provision of Services in the meaning of article 5(1)(b), and that, as a consequence, article 5(1)(a) had to be applied.

In Waeco, a distribution contract of concession exclusive de vente (Sale exclusive concession agreement) had been concluded in 2000 between a German seller, Waeco Int’l, and a French distributor, Waeco France. When the German party terminated the contract in December 2002, the French party decided to initiate proceedings in France. The Court of appeal of Aix-en-Provence had found that article 5 (1)(b) applied. The Cour de cassation reversed and held that article 5(1)(a) applied as exclusive concession agreements were neither sales of goods, nor provisions of services. It then went on to determine the applicable law pursuant to article 4 of the Rome convention to assess where the obligation in question was being performed. It held that the characteristic obligation was the provision of the sales exclusivity by the German seller to the French distributor, and that German law thus applied.

French judgements never mention previous cases. It is thus left to commentators to guess whether what may appear as a contradiction is not, or is. The only way to reconcile these cases that I can think of is to distinguish them on the nature of the distribution contract involved. In the 2006 cases, the distributor was not buying to resell, but was only making the sale happen: he was either facilitating the sale, or an agent. The distribution contract did not entail any sale. In Waeco, the distributor was buying the goods from the seller to resell them, and had the exclusivity of the sales on his commercial territory. The distribution contract involved both a sale and a service. For choice of law purposes, the Cour de cassation rules that one (sales exclusivity) is more important than the other, but for jurisdictional purposes, it refuses to choose and comes back to the good old article 5(1)(a) rule.

Richard Frimston (Russell Cooke solicitors) has written a note in the new issue of Private Client Business on “Brussels IV - The Problems of Trusts and Characterisation in the Civil Law” (P.C.B. (2007) No.3 Pages 170-180). The abstract reads:

Discusses European Commission plans to propose rules on jurisdiction and enforcement of judgments concerning succession (Brussels IV), considering how these plans may affect succession planning with lifetime gifts and settlements. Anticipates what the Commission may propose, and speculates how Brussels IV may interact with the Hague Convention on the Law Applicable to Trusts and on their Recognition 1985. Examines how the UK and Ireland may be particularly affected, because of the different classification of trusts in civil law countries.

A little bit from the conclusion:

In the past, jurisdictions have attempted to protect trust assets from foreign succession law claims on a unilateral basis. With the probability that succession law will become more, rather than less, directly enforceable between European jurisdictions, even more care needs to be given to the legal implications of the initial transfer, especially since change is also in the air, as to the relevant law of such transfer, particularly for dematerialised securities. It is to be hoped that issues of classification will be a matter to be decided by the law of the forum.

The European Commission Green Paper on Succession and Wills (i.e. Brussels IV) can be found here. The UK response to the Green Paper is here. The P.C.B. article can be found on Westlaw for those with access.

In 2006, the French supreme court for private matters (Cour de cassation) held in two cases that distribution contracts ought to be considered as Contracts for the Provision of Services for the purpose of article 5 (1)(b) of the Brussels I Regulation.

The first judgement was delivered on July 11, 2006. In 1997, the German company Wema Post Maschinen had undertaken to pay a 3% commission to several “intermediaries” (intermediaires) (whose names do not appear in the judgement) if they could make happen the sale of a machine to the Delrieu company (seemingly French). The exact nature of the 1997 contract is unclear, and is certainly not characterised by the Cour de cassation, which may mean that the court did not find it material. The sale happened in 2002, and the “intermediaries” sued the German party before a French Court for payment of the commission. In 2005, the Court of Appeal of Limoges held that it did not have jurisdiction over the dispute, as the payment ought to have been made in Germany. The Cour de cassation reversed. It held that the contract between the parties was a Contract for the Provision of Services in the meaning of article 5, and that, as the service had been been provided in France, French courts had jurisdiction.

On October 6, 2006, the Cour de cassation held in Solinas (reported in the last issue of the Journal de Droit International) that a commercial agency contract was a Contract for the Provision of Services for the purpose of article 5. Solinas was the French agent of a Portuguese company, Fabrica Textil Riopele. In 2003, Solinas sued its principal before the Paris Commercial Court and sought payment of an indemnity for increasing the customers of Fabrica Textil Riopele and payment of damages for abusive termination of the (agency) contract. Fabrica Textil Riopele argued that the French court lacked jurisdiction. In 2004, the Paris Court of Appeal held that French courts lacked jurisdiction over the claim for payment of the indemnity, as it ought to be performed in Portugal, at the domicile of the principal. The Cour de cassation reversed and held that the contract between the parties was a Contract for the Provision of Services in the meaning of article 5, and that, as the service had been been provided in France, French courts had jurisdiction.

It is tempting to interpret these two cases as indications of the willingness of the Cour de cassation to rule that all distribution contracts are Contract for the Provision of Services, and that only mere sales contracts will be considered as Sales of Goods in the meaning of article 5. But after Waeco, it seems that these solutions should be confined to contracts which do not involve sales.

If you know of other European cases that would have ruled on the same issue, feel free to post a comment and to share this information.

The Italian Society of International Law (Società Italiana di Diritto Internazionale - SIDI) will hold its XII Annual Meeting at the University of Milan on 8-9 June 2007. The conference is devoted to “International Economic Relations and the Evolution of Their Legal Regime - Subjects, Values and Instruments” (”I rapporti economici internazionali e l’evoluzione del loro regime giuridico - soggetti, valori e strumenti”).

The meeting is structured in three sessions: the first one deals with the topic in a public international law perspective, the second one focuses on contracts in international trade law and the third one on arbitration as a dispute resolution method.

Here’s the programme of the second and third sessions (our translation; the sessions will be held in Italian, except otherwise specified):

Second session (Friday 8 June 2007, 15:00)

Contracts in International Trade (”La disciplina dei contratti nel commercio internazionale”)

Chair and introductory remarks: Giorgio Sacerdoti (”Luigi Bocconi” University, Milan)

• The Law Applicable to Contracts: Conflict of Laws and Substantive Rules (in English): Richard Plender (QC, London)
• Party Autonomy in International Economic Relations and its Limits (”L’autonomia privata nelle relazioni economiche internazionali e i suoi limiti”): Sergio Maria Carbone (University of Genoa)

Shorter reports:

• EC Rules on Jurisdiction in Contracts (”I criteri comunitari di giurisdizione in materia di contratti”): Francesco Salerno (University of Ferrara)
• Protection of the Weaker Party (”La protezione del contraente debole”): Andrea Bonomi (University of Lausanne)
• The Impact of EC Antitrust Rules on Enterprise Autonomy (”L’incidenza delle norme comunitarie antitrust sull’autonomia delle imprese”): Francesco Munari (University of Genoa)
• Party Autonomy vis-à-vis lex contractus, lex societatis and lex mercatus in the EC Market of Rules (”L’autonomia negoziale tra lex contractus, lex societatis e lex mercatus nel mercato comunitario delle regole”): Massimo Benedettelli (University of Bari)

- - -

Third Session (Saturday 9 June 2007, 9:00)

Dispute Resolution: Arbitration (”La soluzione delle controversie: la via arbitrale”)

Chair and introductory remarks: Riccardo Luzzatto (University of Milan)

• International Commercial Arbitration: Evolution Trends (”L’arbitrage commercial international: tendances évolutives”) (in French): Pierre Mayer (University of Paris I, Panthéon-Sorbonne)
• Arbitration in Investment Disputes: Developments and Uncertainties (”L’arbitrato in materia di investimenti: sviluppi e incertezze”): Andrea Giardina (University of Rome “La Sapienza”)

Round Table:

Luca Radicati di Brozolo (Università Cattolica del Sacro Cuore, Milan); Stefano Azzali (Chamber of National and International Arbitration of Milan); Lucy Reed (Freshfields Bruckhaus Deringer, New York); Alexis Mourre (Castaldi Mourre Sprague, Paris); Cesare Fabozzi (University of Milan).

For further information and registration, see the website of SIDI-ISIL.

A very interesting collection of papers held at a symposium in Bayreuth in September 2006 on the Proposal for a Regulation on the law applicable to contractual obligations (”Rome I“) has recently been published: Ferrari/Leible (eds.), Ein neues Internationales Vertragsrecht für Europa

An English abstract has been kindly provided by the editors:

There is still insecurity for transborder-trade. In spite of the Brussels I-Regulation, the rules applied to a dispute within the Community cannot always be predicted. This situation is due to the fact that the national courts will determine the applicable law in different ways. They all follow the conflict rules of their forum, which can diverge. The result is that the identical claim may be submitted to a different law in Munich and in Manchester.

To help this situation, the Member States of the EC had adopted a Convention on the law applicable to contractual obligations during a conference held in Rome in 1980. It had a considerable success in harmonizing the rules of private international law regarding contracts and contractual relationships.

Yet the days of the so-called Rome Convention will soon be over. The Commission is planning to transform it into a regulation as part of the judicial cooperation in civil matters. It has published a “Proposal for a Regulation of the European Parliament and the Council on the Law Applicable to Contractual Obligations (Rome I)”, COM (2005) 650 final, in December 2005.

This proposal has been discussed during a conference in September 2006 in Bayreuth, Germany, which was jointly organized by Stefan Leible and Franco Ferrari. The conference united eminent specialists from Germany and other countries, as well as a representative of the Commission. Their papers, written in German, have now been published by Sellier. The collection is an indispensable tool for any lawyer working in the field of cross-border transactions.

The collection includes the following contributions:

• Matthias Lehmann (University of Bayreuth) defines in his contribution key notions regarding the scope of application, namely „contract“ and „pre-contractual relationship“ and shows that both terms - “contract” as well as “pre-contractual relationship” - have to be interpreted autonomously, which leads to the result that not all legal relationships which would be classified under German law as “pre-contractual” are exluded from the scope of the prospective Rome I Regulation.

• Stefan Leible’s (University of Bayreuth) contribution is dedicated to choice of law-clauses. He addresses in particular the requirements of an implicit choice of law, the question which law can be chosen as well as the rule provided for in Art.3 (5) Rome I Proposal according to which the choice of law shall be, in a case where the parties choose the law of a non-member State, without prejudice to the application of such mandatory rules of Community law as are applicable to the case.

• Franco Ferrari (University of Verona) attends to the law applicable in the absence of a choice of law-clause. He compares Art.4 Rome Convention with Art. 3 Rome I Proposal and examines the consequences of the new rule on particular contracts.

• Dennis Solomon (University of Tübingen) deals with consumer contracts and addresses in particular questions of the scope of application of Art. 5 Rome I Proposal.

• Abbo Junker (Zentrum für Arbeitsbeziehungen und Arbeitsrecht, Munich) addresses contracts in the field of labour law, in particular questions of the planned Regulation’s scope of application with regard to labour law, party autonomy (choice of law) as well as Art. 6 Rome I Proposal.

• Karsten Thorn (Bucerius Law School, Hamburg) tackles the notoriously known problem of mandatory rules. He turns in particular to the question how Art. 8 Rome I Proposal can be classified within the system of Rome I as well as to Art. 8 (3) Rome I Proposal, which is very controversial among the Member States.

• Ulrich Spellenberg (University of Bayreuth) attends to contracts concluded by agents. He examines the internal relationship (between the principal and the agent) as well as the external relationship (between the principal and third parties). Further, also questions of form as well as the agent’s liability for breach of warranty of authority are dealt with.

• Eva-Maria Kieninger’s (University of Würzburg) and Harry C. Sigman’s (Los Angeles, member of the Law Revision Committee on UCC Article 9 and member of the US delegation on the evolution of UNCITRAL recommendations on security interests) contribution is dedicated to assigment and statuatory subrogation. The first part, dealing with voluntary assignment and contractual subrogation (Art. 13) deals with Art. 13 (3) Rome I Proposal, which gives now an answer to the (so far) contentious problem which law is applicable to the question whether the assignment or subrogation may be relied on against a third party. Furthermore, it is dealt with questions such as the material scope of application of Art. 13. In the second part, the rule of Art. 14 dealing (only) with statutory subrogation is discussed, inter alia in view of Rome II.

• Ulrich Magnus (University of Hamburg) writes on multiple liability and set-off. With regard to statutory offsetting, regulated in Art. 16 Rome I Proposal, the legal situation under the Rome Convention - which does not contain a separate rule on the law applicable with regard to statutory offsetting - as well as the ECJ’s case law and the scope of application of Art. 16 Rome I Proposal are illustrated. The second part deals with Art. 15 Rome I Proposal (multiple liability), in particular with questions of the provision’s scope.

• Ansgar Staudinger (University of Bielefeld) attends to insurance contracts by describing in a first step the system of the Rome I Proposal with regard to insurance contracts which is criticised in view of the coexistence of two regimes: Rome I on the one side and directives on the other side. Thus, in a second step an alternative approach is developed according to which only the choice of law rules of the prospective Rome I Regulation should be applied.

As the contents show, the book includes contributions on the most important and most discussed issues with regard to Rome I and can therefore be highly recommended.

Further information can be found on the publisher’s website, where it can also be purchased.

See also the report on the conference by Robert Freitag (University of Hamburg) which has been published in the latest issue of the Praxis des Internationalen Privat- und Verfahrensrecht (IPRax 2007, 269).