On 26 February 2014 the European Parliament adopted a legislative resolution on the Proposal for a Common European Sales Law. The full text is not yet available. However, you can find a comment on the plenary debate on “European Private Law News”.
Further information on the procedure is available in the Procedure File 2011/0284(COD) on the website of the European Parliament.
Many thanks to Ana Koprivica, research fellow of the MPI Luxembourg
In July 2013 the United Nations Commission on International Trade Law (UNCITRAL) adopted the Rules on Transparency in Investor-State Arbitration. The Rules shall enter into force on 1st April 2014 and apply to all investor-state disputes initiated under UNCITRAL Arbitration Rules pursuant to international investment agreements concluded prior to or after this date.
At the outset it should be noted that the range of potentially applicable rules in international investment arbitration today is extremely wide and provides the parties with a lot of room to tailor their procedure in accordance with their specific needs. Consequently, they also make it possible for the parties to limit or constrain transparency in the dispute between them. This triggers the concerns of not having a proper mechanism to safeguard transparency. To that end, the UNCITRAL Working Group II (Arbitration and Conciliation) adopted two approaches when drafting the Rules: one would be the possibility for States to offer to arbitrate disputes under those arbitration rules that require transparency (which has so far only been a theoretical possibility) and the other, the option for States to conclude a new treaty which would supplement or replace the already existing investment treaties and require arbitration pursuant to rules requiring transparency. The first approach is reflected in the newly adopted Transparency Rules, whilst the second will possibly result in the adoption of the Transparency Convention, the second reading of which took place two weeks ago in New York at the 60th UNCITRAL session.
Main Features
The New Transparency Rules have become an integral part of the UNCITRAL Arbitration Rules, but they are also made available as a stand-alone instrument for application in disputes that are governed by other arbitral rules. The main aim of the Rules is to make proceedings transparent. In that respect, the provisions mandating disclosure and openness (Articles 2, 3, 6 and 7) and those that govern participation by non-disputing parties (Articles 4 and 5) appear to be the most important features of the Rules.
Access to Documents
As soon as the arbitral proceedings commence, i.e., once there is evidence respondent has received the notice of arbitration (which itself is subject to automatic mandatory disclosure), a basic set of facts will be disclosed: names of the parties, economic sector involved and the underlying treaty (Art.2). The Rules further distinguish between the mandatory automatic disclosure that certain documents are subject to (all statements and submissions by the disputing parties and non-disputing State parties or third persons; transcripts of hearings; and orders, decisions and awards of the arbitral tribunal); mandatory disclosure on request of any person (witness statements and expert reports), and the disclosure of other documents (such as exhibits) which depend on the exercise of the particular tribunal’s discretion (Article 3). To balance the Transparency Rules’ provisions on disclosure, Article 7 specifies that disclosure is subject to exceptions for confidential or protected information. It further lists four categories of such information. Whether and what information will fall under the exceptions will be an issue to be decided on a case-by-case basis. Tribunals are also permitted to restrain or limit disclosure when necessary to protect the “integrity of the process”, which is only intended to restrain or delay disclosure in exceptional circumstances.
Amicus Curiae and Submissions from non-disputing Parties
The students and alumni in International Law of the University Panthéon-Assas will organize a conference on Parallel Proceedings and Contradictory Decisions in International Arbitration on March 21st, 2014 in the premises of the International Chamber of Commerce in Paris.
The morning will be dedicated to Investment Arbitration. The afternoon will focus on Commercial Arbitration and International Private Law. Speeches will be in French.
This event is organized by three students associations of the masters’ degree in International Private Law and International Business Law, International (Droit International Privé et Droit du Commerce International), in International Relations and Trade Law (Droit des Relations Economiques Internationales) and of the Institut des Hautes Etudes Internationales of the University Panthéon-Assas, in collaboration with two research centers, namely the Centre de Recherche de Droit International (CRDI) and l’Institut des Hautes Etudes Internationales (IHEI).
Matinée : Droit des Investissements (9h45-12h30)
– Développement des procédures parallèles et facteurs de désordres procéduraux en arbitrage d’investissement: Walid BEN HAMIDA (Université d’Evry Val-Essonne)
– La contrariété de décisions en arbitrage d’investissement, risques et conséquences: Fernando MANTILLA SERRANO (Shearman & Sterling LLP Paris)
– Retour sur la pertinence de la distinction « contract claims » et « treaty claims » : Ibrahim FADLALLAH (Université Paris-Ouest Nanterre la Défense)
– Procédures Parallèles : aspects procéduraux et solutions institutionnelles : Eloïse OBADIA (Derains & Gharavi Washington D.C.)
– La concurrence des instances arbitrales : que disent les principes du contentieux international ? Yves NOUVEL (Université Panthéon-Assas)
Mark Weidemaier (University of North Carolina) has published Sovereign Immunity and Sovereign Debt in the latest issue of the University of Illinois Law Review.
The law of foreign sovereign immunity changed dramatically over the course of the 20th century. The United States abandoned the doctrine of absolute immunity and opened its courts to lawsuits by private claimants against foreign governments. It also pursued a range of other policies designed to shift such disputes into litigation or arbitration (and thus relieve political actors of pressure to intervene on behalf of disappointed creditors). This Article uses a unique data set of sovereign bonds to explore how international financial contracts responded to these legal and policy initiatives.
The Article makes three novel empirical and analytical contributions. The first two relate to the law of sovereign immunity and to the role of legal enforcement in the sovereign debt markets. First, although the decision to abandon the absolute immunity rule was a major legal and policy shift, this article demonstrates that investors dismissed their new enforcement rights as irrelevant to the prospect of repayment. Second, the ongoing Eurozone debt crisis has prompted fears that private investors will use litigation to prevent debt restructurings necessary to revive European economies. This Article shows that such fears may be overblown and, in the process, informs the broader empirical and theoretical debate about the role of legal enforcement in the sovereign debt markets.
Finally, the Article exposes a gap in contract theory as it pertains to boilerplate contracts such as sovereign bonds. Boilerplate presents a puzzle of intense interest to contracts scholars. It is drafted to serve the interests of sophisticated, well-resourced players, yet it often remains static in the face of new risks. To explain this inertia, contract theory posits that major shifts in boilerplate financial contracts require a financial crisis or other exogenous shock that substantially alters investors’ risk perceptions. This Article, however, demonstrates that the Foreign Sovereign Immunities Act of 1976 prompted a major shift in contracting practices despite investors’ continued indifference to legal enforcement and argues that contract theory must recognize that a wider range of forces may prompt boilerplate to change.
A Liber Amicorum to French leading PIL scholar Bernard Audit (Mélanges en l’honneur du Professeur Bernard Audit) will be published in the coming months. It will include the following contributions:
Bertrand ANCEL (Université Paris II)
Exequatur et prescription
Louis d’AVOUT (Université Paris II)
La lex personalis entre nationalité, domicile et résidence habituelle
Tristan AZZI (Université Paris Descartes)
La Cour de justice et le droit international privé ou l’art de dire parfois tout et son contraire
Jean-Sylvestre BERGé (Université Lyon 3)
Droit international privé et approche contextualisée des cas de pluralisme juridique mondial
George A. BERMANN (Columbia Law School)
The European Law Institute : a Transatlantic Perspective
Mathias Audit (University Paris Ouest Nanterre la Defense) has posted Sovereign Bonds and National Relativism: Can New York Law Contracts Safely Cross the Atlantic? on SSRN.
Based on an overview of European cases related to the NML vs Argentina litigation saga, this article aims to show that the crossing of the Atlantic is perilous travel for sovereign bonds contracts terms. Normally, the choice of New York as providing governing law and as the competent court would ensure a certain degree of uniformity of interpretation and application of those contracts terms. However, it appears that some European countries’ rules might interfere with this goal of uniformity, particularly in the context of two clauses: the waiver of immunity from attachment and execution and the pari passu clause.
In an earlier post I discussed three first-instance decisions of Canadian courts, one from each of Ontario, British Columbia and Quebec, holding that the court could, at its discretion, sit outside the province.
Two of those decisions were appealed and one appeal has now been decided. In Endean v British Columbia, 2014 BCCA 61 (available here) the Court of Appeal has reversed the lower court’s decision in British Columbia and called into question the other two lower court decisions.
The court held (at para 82) that “British Columbia judges cannot conduct hearings that take place outside the province. Such a major law reform is for the legislature to determine.” The court did note that “There is, however, no objection to a judge who is not personally present in the province conducting a hearing that takes place in a British Columbia courtroom by telephone, video conference or other communication medium”.
The reasoning of the Court of Appeal echoes that in a comment written about the three first-instance decisions by Vaughan Black and Stephen G.A. Pitel entitled “Out of Bounds: Can a Court Sit Outside its Home Jurisdiction?” (currently available only through access to (2013) 41 Advocates’ Quarterly 503).
Many of you will have noticed that much of the functionality on the site has temporarily disappeared. This is intentional, or at least as intentional as it could be. I will not bore you with details of servers and software, backends and frameworks, but suffice to say when all of this was upgraded, it broke the design of the site. So, I am now working on a new design which does work, but this will take me a little time. Until then, you should still see all of the posts on here, receive of all the updates, and be able to comment as appropriate.
The Hague Conference on Private International Law has announced that the Experts’ Group on the Recognition and Enforcement of Foreign Protection Orders met in The Hague on 12 and 13 February 2014 and issued Conclusions and Recommendations. A provisional version is available here.
The final versions of the Conclusions and Recommendations, in both English and French, will be included in Preliminary Document No 4 for the attention of the 2014 meeting of the Council on General Affairs and Policy of the Hague Conference.
On 6 February 2014, the Court of Justice of the European Union delivered its judgment in Blomqvist v. Rolex (case C-98/13).
In January 2010, Mr Blomqvist, a resident of Denmark, ordered a watch described as a Rolex from a Chinese on-line shop. The order was placed and paid for through the English website of the seller. The seller sent the watch from Hong Kong by post. The parcel was inspected by the customs authorities on arrival in Denmark, who suspended the customs clearance of the watch. Rolex established that it was counterfeit, and requested that the buyer consent to destruction, as provided by Regulation (EC) No 1383/2003 of 22 July 2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights (‘the customs regulation’). The buyer refused. Rolex went to court and won.
On appeal, the Danish court raised the question whether an intellectual property right had actually been infringed, as required for the implementation of the customs regulation, given that, for that regulation to apply, first, there must be a breach of copyright or of a trade mark right which is protected in Denmark and, second, the alleged breach must take place in the same Member State.
The ECJ ruled:
26 In those circumstances the questions referred must be understood as meaning that the referring court seeks to know whether it follows from the customs regulation that, in order for the holder of an intellectual property right over goods sold to a person residing in the territory of a Member State through an online sales website in a non-member country to enjoy the protection afforded to that holder by that regulation at the time when those goods enter the territory of that Member State, that sale must be considered, in that Member State, as a form of distribution to the public or as constituting use in the course of trade. The referring court also raises the question whether, prior to the sale, the goods must have been the subject of an offer for sale or advertising targeting consumers in the same State.
27 In that regard, it must be borne in mind, first, that the proprietor of a trade mark is entitled to prohibit a third party from using, without the proprietor’s consent, a sign identical with that trade mark when that use is in the course of trade, is in relation to goods or services which are identical with, or similar to, those for which that trade mark is registered, and affects, or is liable to affect, the functions of the trade mark (Joined Cases C-236/08 to C-238/08 Google France and Google [2010] ECR I?2417, paragraph 49 and the case-law cited).
28 Second, under the copyright directive, an exclusive right is conferred on authors to authorise or prohibit any form of distribution to the public by sale or otherwise of the original of their works or copies thereof. Distribution to the public is characterised by a series of acts going, at the very least, from the conclusion of a contract of sale to the performance thereof by delivery to a member of the public. A trader in such circumstances bears responsibility for any act carried out by him or on his behalf giving rise to a ‘distribution to the public’ in a Member State where the goods distributed are protected by copyright (see, to that effect, Donner, paragraphs 26 and 27).