Yesterday, Advocate General Kokott delivered her opinion in case C-523/07 (Applicant A).

The case, which has been referred to the ECJ by the Finnish Korkein hallinto-oikeus, concerns three children who lived originally in Finland with their mother (A) and stepfather. In 2001 the family moved to Sweden. In summer 2005 they travelled to Finland – originally with the intention to spend their holidays there. In Finland, the family lived on campsites and with relatives and the children did not go to school there. In November 2005 the children were taken into immediate care and placed into a child care unit. This was unsuccessfully challenged by the mother and the stepfather.

The Korkein hallinto-oikeus, which is hearing the appeal, had doubts with regard to the interpretation of the Brussels II bis Regulation and referred the following questions to the ECJ for a preliminary ruling:

1(a) Does Council Regulation (EC) No 2201/2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility, repealing Regulation (EC) No 1347/2000, (the Brussels IIa Regulation) apply to the enforcement, such as in the present case, of a public-law decision made in connection with child protection, as a single decision, concerning the immediate taking into care of a child and his or her placement outside the home, in its entirety,

(b) or, having regard to the provision in Article 1(2)(d) of the regulation, only to the part of the decision relating to the placement outside the home?

2 How is the concept of habitual residence in Article 8(1) of the regulation, like the associated Article 13(1), to be interpreted in Community law, bearing in mind in particular the situation in which a child has a permanent residence in one Member State but is staying in another Member State, carrying on a peripatetic life there?

3(a) If it is considered that the child’s habitual residence is not in the latter Member State, on what conditions may an urgent measure (taking into care) nevertheless be taken in that Member State on the basis of Article 20(1) of the regulation?

(b) Is a protective measure within the meaning of Article 20(1) of the regulation solely a measure which can be taken under national law, and are the provisions of national law concerning that measure binding when the article is applied?

(c) Must the case, after the taking of the protective measure, be transferred of the court’s own motion to the court of the Member State with jurisdiction?

4 If the court of a Member State has no jurisdiction at all, must it dismiss the case as inadmissible or transfer it to the court of the other Member State?

AG Kokott suggested in her opinion to answer these questions as follows:

1.      Article 1(1) of Council Regulation (EC) No 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility, repealing Regulation (EC) No 1347/2000, as amended by Council Regulation (EC) No 2116/2004 of 2 December 2004, must be interpreted as meaning that a single decision ordering a child to be taken into care immediately and placed outside his or her original home in a child care unit is covered by the term “civil matters” for the purposes of that provision, where that decision was adopted in the context of public law rules relating to child protection.

With regard to this first question, the AG could refer to the judgment given by the ECJ in case C-435/06 (Applicant C) since the question referred to the Court has essentially been the same. (See with regard to case C-435/06 our previous posts on the reference, the opinion and the judgment).

2.      A child is habitually resident under Article 8(1) of Regulation No 2201/2003 in the place in which the child – making an overall assessment of all the relevant factual circumstances, in particular the duration and stability of residence and familial and social integration – has his or her centre of interests. Only if no habitual residence in that sense can be established and if no jurisdiction based on Article 12 exists do the courts of the Member State in which the child is present have jurisdiction under Article 13(1) of the regulation.

Of particular interest are the AG’s remarks on the second question which concerns the interpretation of the concept of the child’s habitual residence – which is not defined in the Regulation itself. Here, the AG emphasises that the basic idea underlying the rules on jurisdiction in Brussels II bis is that the courts of the Member State should have jurisdiction which are best placed to take decisions concerning parental responsibility. And these are – because of proximity – the courts of the Member State in which the child is habitually resident (para. 18). Even though also mere presence may establish proximity to the courts of the respective State, the AG stresses that mere presence does not lead to a relationship of the same quality as habitual residence (para. 20). Thus, criteria must be developed in order to distinguish habitual residence from mere presence.

Taking into consideration the wording and objectives of Brussels II bis as well as the relevant multilateral conventions, AG Kokott states that “the concept of habitual residence in Article 8 (1) of the Regulation should therefore be understood as corresponding to the actual centre of interests of the child.” (para. 38)

As relevant criteria for the distinction between habitual residence and the mere (temporary) presence, the AG designates in particular a certain duration and regularity of residence, which might be interrupted as long as it is only a temporary absence (para. 41 et seq.). Further, the familial and social situation of the child constitute important indicators for habitual residence (para. 47 et seq.).

3.      (a)   Article 20(1) of Regulation No 2201/2003 allows the courts of a Member State in urgent cases to take all provisional measures for the protection of a child who is present in that Member State, even if the courts of another Member State have jurisdiction under the regulation over the substance of the matter. There is urgency if immediate action is, in the view of the court seised in the State of the child’s presence, necessary to preserve the child’s welfare.

With regard to this question, the AG stresses that Art. 20 (1) Brussels II bis has to be interpreted narrowly since it authorises courts to act which do not have jurisdiction over the substance of the matter (para. 56). Further, the AG clarifies that there are basically three requirements which have to be taken into consideration with regard to the application of Art. 20 (1): First, the measure may relate only to children who are present in the respective Member State (para. 57). Second, there must be an urgent case (para. 58) and third, Art. 20 (1) permits only provisional measures since the final decision is reserved to the court which has jurisdiction over the substance of the matter (para. 60).

(b)      Article 20(1) of the regulation allows the taking of the provisional measures that are available under the law of the Member State of the court seised, and those measures need not be expressly designated as provisional measures under national law. It is otherwise for the referring court to determine which measures may be taken under national law and whether the provisions of national law are binding.

(c)      The regulation does not oblige the court which has taken a provisional measure under Article 20(1) to transfer the case to the court of another Member State with jurisdiction over the substance of the matter. However, it does not preclude the court seised from informing the court with jurisdiction, directly or via the central authorities, of the measures taken.

4.      A court which under the regulation lacks jurisdiction over the substance of the matter and does not consider any provisional measures under Article 20(1) of the regulation to be necessary must declare that it lacks jurisdiction, under Article 17 of the regulation. The regulation does not provide for a transfer to the court with jurisdiction. However, it does not preclude the court seised from informing the court with jurisdiction, directly or via the central authorities, of its decision.

See with regard to this case also our post on the reference which can be found here.

Yesterday, Advocate General Trstenjak`s opinion in case C-533/07 (Falco Privatstiftung und Rabitsch) was published.

This case is of particular interest since it concerns the interpretation of the notion of “services” (Art. 5 (1) (b) second indent Regulation (EC) Nr. 44/2001 (Brussels I Regulation)) which has not been interpreted by the ECJ in the context of the Regulation so far. Further, with Art. 5 (1) Brussels I Regulation, the case concerns the interpretation of a provision which has been highly discussed in the course of the transformation of the Brussels Convention to the Regulation.

I. Background

The case concerns – briefly worded – proceedings between two plaintiffs, the first being a foundation managing the intellectual property rights of the late Austrian singer “Falco” established in Vienna (Austria), the second being a natural person domiciled in Vienna as well and a defendant domiciled in Munich (Germany) who are arguing about royalties regarding DVDs and CDs of one of the late singer’s concerts: While a licence agreement was concluded between the plaintiffs and the defendant concerning the distribution of the DVDs in Austria, Germany and Switzerland, the distribution of the CDs was not included by this agreement. In the following, the plaintiffs sued the defendant for payment – based, with regard to the DVDs, on the licence agreement and with regard to the CDs on the infringement of their intellectual property rights.

The first instance court in Austria (Handelsgericht Wien) assumed its international jurisdiction according to Art. 5 (3) Brussels I Regulation arguing that it had jurisdiction with regard to the infringement of intellectual property rights since the respective CDs were sold inter alia in Austria. Due to the close connection between the claim based on the licence agreement and the claim based on the infringement of intellectual property rights, the court assumed jurisdiction for the contractual claim as well.

The court of second instance (Oberlandesgericht Wien), however, held that it had no jurisdiction with regard to the claim based on the licence agreement arguing Art. 5 (1) (a) Brussels I Regulation was applicable. Since the principal contractual obligation was a debt of money, which had to be fulfilled under German law as well as under Austrian law at the debtor’s domicile (Munich), German (and not Austrian) courts had jurisdiction. According to the Oberlandesgericht Wien, jurisdiction could not be based on Art. 5 (1) (b) Brussels I Regulation either, since the licence agreement did not involve the “provision of services” in terms of the Regulation.

Subsequently, the plaintiffs appealed to the Austrian Supreme Court of Justice (Oberster Gerichtshof).

II. Reference for a Preliminary Ruling

Since the Oberste Gerichtshof had doubts on the interpretation of Art. 5 (1) Brussels I, it referred the following questions to the ECJ for a preliminary ruling:

1. Is a contract under which the owner of an incorporeal right grants the other contracting party the right to use that right (a licence agreement) a contract regarding ‘the provision of services’ within the meaning of Article 5(1)(b) of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the Brussels I Regulation)?

2. If Question 1 is answered in the affirmative:

2.1. Is the service provided at each place in a Member State where use of the right is allowed under the contract and also actually occurs?

2.2. Or is the service provided where the licensor is domiciled or, as the case may be, at the place of the licensor’s central administration?

2.3. If Question 2.1 or Question 2.2 is answered in the affirmative, does the court which thereby has jurisdiction also have the power to rule on royalties which result from use of the right in another Member State or in a third country?

3. If Question 1 or Questions 2.1 and 2.2 are answered in the negative: Is jurisdiction as regards payment of royalties under Article 5(1)(a) and (c) of the Brussels I Regulation still to be determined in accordance with the principles which result from the case-law of the Court of Justice on Article 5(1) of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (the Brussels Convention)?

III. Opinion

1. First Question

In her extensive opinion, AG Trstenjak first clarifies that the referring court basically aims to know with regard to the first question whether Art. 5 (1) (b) second indent Brussels I Regulation has to be interpreted to that effect that a contract under which the owner of an incorporeal right grants the other contracting party the right to use that right (a licence agreement) constitutes a contract regarding the “provision of services” within the meaning of this provision – and thus whether a licence agreement can be regarded as a contract on the provision of services in terms of Art. 5 (1) (b) second indent Brussels I Regulation (para. 46).

With regard to this question, the AG states in a first step, that “licence agreement” has to be understood in this context as a contract under which the owner of an incorporeal right grants the other contracting party the right to use that right (para. 48 et seq.).

In a second step, the AG turns to the notion of “services” in Art. 5 (1) (b) second indent Brussels I which does not provide for an explicit definition of this term (para. 53 et seq.). Here, the AG stresses that – due to the lack of an express definition and the fact that the ECJ has not interpreted the meaning of services in the context of the Brussels I Regulation so far – starting point for an interpretation has to be on the one side the general meaning of this term while on the other side, an analogy to other legal sources might be taken into consideration. With regard to an abstract definition of “services”, the AG regards two elements to be of particular significance: First, the term of “services” requires some kind of activity or action by the one providing the services. Secondly, the AG regards it as crucial that the services are provided for remuneration (para. 57).

On the basis of this general definition, the AG holds that a licence agreement cannot be regarded as a contract having as its object the provision of services in terms of Art. 5 (1) (b) second indent Brussels I Regulation (para. 58) since the licensor does not perform any activity by granting the licence. The lincensor’s only activity constitutes the signing of the licence agreement and the ceding of the licence’s object for use. This, however, cannot, in the AG’s view, be regarded as “service” in terms of this provision.

In the following, the AG also turns to primary law in order to examine whether the term of  “service” used in primary law can be transferred to the Brussels I Regulation (para. 60 et seq.). This, however, does not lead to a different assessment  since, according to the AG, the definition of “services” cannot be transferred to the Brussels I Regulation without restrictions due to the fact that the objectives of the Regulation have to be taken into account – and they differ significantly from the  purposes underlying the broad interpretation of “services” in terms of Art. 50 EC aiming at establishing a common market (para. 63).

Of particular interest is the AG’s reference to Regulation (EC) No. 593/2008 (Rome I Regulation) (para. 67 et seq.) which is used as an additional argument supporting her opinion: She stresses that – by interpreting the notion of “services” – also the Rome I Regulation has to be taken into consideration in order to prevent an interpretation being contrary to the aims of Rome I since Recital No. 7 of the Rome I Regulation states: “The substantive scope and the provisions of this Regulation should be consistent with Council Regulation (EC) No 44/2001 […]”. Here, the AG shows with a view to the origin of the Rome I Regulation that an interpretation including licence agreements into the notion of “services” would run counter to the aims of Rome I (para. 69).

2. Third Question

Due to the fact that the AG answers the first question in the negative, she does not deal with the second question, but turns directly to the third question by which the Austrian court basically aims to know whether Art. 5 (1) (a) Brussels I Regulation has to be interpreted in continuity with Art. 5 (1) Brussels Convention (para. 78 et seq.).

With regard to this question, the AG argues – after explaining in detail the changes Art. 5 has passed through from the Convention to the Regulation (para. 80 et seq.) – that Art. 5  (1) (a) Brussels I Regulation has to be – in view of Recital No. 19 of the Brussels I Regulation according to which “[c]ontinuity between the Brussels Convention and [the Brussels I] Regulation should be ensured […]” –  interpreted in the same way as Art. 5 (1) Brussels Convention (para. 87). This approach is supported by the identical wording of both provisions as well as historical arguments (para. 94). Here, the AG pays particular attention to the fact that by means  of Art. 5 (1) (b) Brussels I Regulation a special provision with regard to contracts concerning the sale of goods and the provision of services was established, while with regard to all other contracts the wording of the first part of Art. 5 (1) Brussels Convention was maintained in Art. 5 (1) (a) Brussels I Regulation (para. 85).

3. The Advocate General’s Conclusion

Thus, AG Trstenjak suggests that the Court should answer the questions referred for a preliminary ruling as follows:

1.  With regard to the first question, the AG suggests that Art. 5 (1) (b) second indent Brussels I Regulation has to be interpreted as meaning that a contract under which the owner of an incorporeal right grants the other contracting party the right to use that right (licence agreement) does not constitute a contract regarding ‘the provision of services’ in terms of this provision.

2. With regard to the third question, the AG suggests that Art. 5 (1) (a) and (c) Brussels I Regulation has to be interpreted to the effect that jurisdiction for proceedings related to licence agreements has to be determined in accordance with the principles which result from the ECJ’s case law regarding Art. 5 (1) Brussels Convention.

(Approximate translation of the German version of the AG’s opinion.)

AG Trstenjak’s opinion can be found (in German, French, Italian and Slovene) at the ECJ’s website. The referring decision of the Austrian Supreme Court of Justice of 13 November 2007 can be found here under 4Ob165/07d (in German).

As previously mentioned on this site, the case of Abbott v. Abbott continues to look like the U.S. Supreme Court’s first attempt to clarify the operation of the Hague Abduction Convention. Last week, the Court invited the views of the new Solicitor General on whether the case should be accepted. While there is no way to tell whether the SG will urge granting the Petition, or whether the Court will follow that advice, this at least seems to mean that someone at One First Street wants to take a closer look at the Convention.

The briefs in that case, including an amicus brief by the Permanent Bureau urging a grant of the petition, is available at the SCOTUSBlog.

Please find a call for papers for the third quadrennial international conference on comparative private international law to be held at the University of Johannesburg in South Africa (9-11 September 2009) on www.uj.ac.za/law. Confirmed speakers include Prof C F Forsyth (University of Cambridge) and Prof M M Martinek (University of Saarland).