Author Archives: Xandra Kramer

Dutch draft bill on collective action for compensation – a note on extraterritorial application

As many readers will know, the Dutch collective settlement scheme – laid down in the Dutch collective settlement act (Wet collective afhandeling massaschade, WCAM) – has attracted a lot of international attention in recent years as a result of several global settlements, including those in the Shell and Converium securities cases. Once the Amsterdam Court of Appeal (that has exclusive competence in these cases) declares the settlement binding, it binds all interested parties, except those beneficiaries that have exercised the right to opt-out. When the WCAM was enacted almost ten years ago, the Dutch legislature deliberately choose not to include a collective action for the compensation of damages to avoid some of the problematic issues associated with US class actions and settlements.

However, following a Parliamentary motion, this summer the Dutch legislature published a draft proposal for public consultation (meanwhile closed, public responses available here) to extend the existing collective action to obtain injunctive relief to compensation for damages. As the brief English version of the consultation paper states, the draft bill aims to:

“enhance the efficient and effective redress of mass damages claims and to strike a balance between a better access to justice in a mass damages claim and the protection of the justified interests of persons held liable. It contains a five-step procedure for a collective damages action before the Dutch district court.
Legal entities which fulfill certain specific requirements (expertise regarding the claim, adequate representation, safeguarding of the interests of the persons on whose behalf the action is brought) can start a collective damages action on behalf of a group of persons. The group of persons on whose behalf the entity brings the action must be of a size justifying the use of the collective damages action. Those persons must not have other efficient and effective means to get redress. The entity must have tried to obtain redress from the person held liable amicably.”

A point of particular interest is a provision regarding the extraterritorial application of the proposed act. The Amsterdam Court of Appeal has been criticized by both Dutch and other scholars for adopting a wide extraterritorial jurisdiction in the WCAM procedure, on the basis of the Brussels Regulation, the Lugano Convention and domestic international jurisdiction rules. The application of the European jurisdiction rules is challenging in view of the particular procedural design of the WCAM scheme (a request to declare a settlement binding between a responsible party and representative organisations/foundations on behalf of interested parties). This draft bill does not introduce separate international jurisdiction rules, but proposes a ‘scope rule’ to ensure that the case is sufficiently connected to the Netherlands. The draft explanatory memorandum (in Dutch) states that a choice of forum of two foreign parties in relation to an event occurring outside the Netherlands will not suffice to seize the Dutch court for a collective compensatory action, even if parties have made a choice of law for Dutch law (yes, we see similarities to the US Supreme Court case Morrison v. National Australia Bank). It is required that either the party addressed has its domicile or habitual residence in the Netherlands (a), or that the majority of the interested parties have their habitual residence in the Netherlands (b), or that the event(s) on which the claim is based occurred in the Netherlands. Needless to say that these rules leave the application of the jurisdiction rules of Brussels and Lugano unimpeded. It is clear that the proposed provision limits the possibility for foreign parties to seek collective compensatory relief in the Netherlands. The risk of the Netherlands becoming a ‘magnet jurisdiction’ for collective redress as put forward by some commentators seems therefor absent.
See for two recent English publications on the Dutch collective settlements act, published in the Global Business & Development Law Journal 2014 (volume 27, issue 2) devoted to Transnational Securities and Regulatory Litigation in the Aftermath of Morrison v. Australia National Bank: Bart Krans (University of Groningen), The Dutch Act on Collective Settlement of Mass Damages, and Xandra Kramer (Erasmus University Rotterdam), Securities Collective Action and Private International Law Issues in Dutch WCAM Settlements: Global Aspirations and Regional Boundaries.

Papers ELI/UNIDROIT Project on Civil Procedure published

As we reported earlier, in October 2013, the first exploratory workshop of the ELI/UNIDROIT project on European Rules of Civil Procedure took place. This was followed by the launch of three pilot studies this spring, the first results of which will be discussed in Rome next week.

Most of the papers presented at the first exploratory workshop have meanwhile been published in the Uniform Law Review 2014, issues 2 and 3.

Uniform Law Review 2014/2

Uniform Law Review 2014/3

Dutch Private International Law journal, 2014 second and third issue published

The second issue of 2014 of the Dutch journal on Private International Law, Nederlands Internationaal Privaatrecht (published in June) includes scholarly articles on the Unamar ruling of the European Court of Justice and the reform of the European Insolvency Regulation.

Jan-Jaap Kuipers & Jochem Vlek, ‘Het Hof van Justitie en de bescherming van de handelsagent: over voorrangsregels, dwingende bepalingen en openbare orde’, p. 198-206. The English abstract reads:

In Unamar, the Court of Justice of the European Union decided that national rules providing protection to commercial agents going beyond the mandatory floor laid down by the Agency Directive can be qualified as overriding mandatory provisions. This article discusses the decision of the CJEU and its articulation with another case involving the Agency Directive: Ingmar. Subsequently, the article addresses two wider issues relating to overriding mandatory provisions and the Agency Directive that, even after Unamar, remain to be resolved. The first is whether rules primarily protecting the weaker party, such as the agent, can at all be qualified as overriding mandatory provisions. The second is whether a choice of court or arbitration clause should be set aside or invalidated because of the applicability of an overriding mandatory provision.

Laura Carballo Piñeiro, ‘Towards the reform of theEuropean InsolvencyRegulation: codification rather than modification’, p. 207-215. The abstract reads:

The European Insolvency Regulation has largely succeeded in providing a framework for cross-border insolvency. But after serving for more than a decade, the time is ripe to give it ‘a new facelift’, as suggested by Mrs. Viviane Reding. This paper provides a critical overview of the Proposal amending the Regulation issued by the European Commission on 12 December 2012. While its inputs are backed up by a broad consensus as it mostly reflects developments in national insolvency laws and codifies the Court of Justice of the European Union’s case law, the Proposal is a missed opportunity to modify some rules which do not properly contribute in their current wording to achieving the insolvency proceedings’ goals. This is particularly remarkable in view of the extension of the Regulation’s scope of application to include proceedings with reorganization, adjustment of debt or rescue purposes and hence, aiming to enhance their cross-border effects and ultimate goals.

The recently published third issue of 2014 of the Dutch journal on Private International Law, Nederlands Internationaal Privaatrecht contains the following three articles on: the (English) court language in international litigation, the recognition and enforcement of provisional and protective measures and international matrimonial property law in Turkey.

 Johanna L. Wauschkuhn, ‘Babel of international litigation: Court language as leverage to attract international commercial disputes’, p. 343-350. The abstract reads:

 Ever since the disappearance of Latin from European courtrooms, it has been commonly understood that each nation would use its own language(s) in its own courts of law. However, in the last few years, discussions have arisen among politicians and legal scholars as to the possibility of introducing foreign languages as court languages. Whereas politicians are mostly driven by economic considerations, many academics are more reluctant as they fear an infringement of the principle of the publicity of proceedings and a contamination of the native legal system. The present article analyses whether offering the option of using a non-national language as court language in civil and commercial litigation is an effective, feasible and efficient leverage to make a jurisdiction (or court) more attractive for international commercial dispute resolution. The article therefore addresses, firstly, why and how lawmakers would try to attract legal disputes and, secondly, why and how parties to a dispute choose a particular jurisdiction. Here, special attention is paid to the role of language in the choice of court. Following this, the most prominent and most frequently expressed practical and constitutional objections regarding competition by means of court language are summarised. After this theoretical presentation, the jurisdictions of Germany and Switzerland are analysed, as examples, as to their standing in the present discussion and their role on the market for international dispute resolution. It is concluded that the objections against introducing a non-national court language outweigh the mostly economic arguments in favour, especially considering the only minimal positive effects.

Carlijn van Rest, ‘Erkenning en tenuitvoerlegging van (ex parte) voorlopige en bewarende maatregelen op grond van de EEX-Verordening en de Herschikking van de EEX-Verordening. Een analyse aan de hand van de Engelse Freezing Order’, p. 351-356. The English abstract reads:

 An English Freezing Order is an interim prohibitory injunction, which is almost invariably granted ex parte and which restrains a party from disposing or dealing with its assets. On the basis of the Brussels I Regulation it is possible to recognize and enforce an English Freezing Order in the Netherlands. This is only possible if the Freezing Order has been granted on an inter partes basis, because ex parte decisions cannot generally be enforced. This article discusses what a (worldwide) Freezing Order exactly is and under what conditions it can be ordered by the English courts. A comparison will be made with the Dutch garnishee order (conservatoir derdenbeslag). Furthermore, this article discusses the problems with the recognition and enforcement of provisional and protective measures which have been granted ex parte under the Brussels I Regulation (Regulation No. 44/2001) and the consequences for the recognition and enforcement of ex parte decisions under the Recast of the Brussels I Regulation (Regulation No. 1215/2012).

 Zeynep Derya Tarman & Ba?ak Ba?o?lu, ‘Matrimonial property regime in Turkey’, p. 357-363. The abstract reads:

As the number of marriages between spouses from different nations is increasing the issue of the matrimonial property regime has become significant. The aim of this article is to examine the possible problems when claims regarding the matrimonial property regime with a foreign element are brought before a Turkish court. In this regard, both the private international law and the substantive law aspects of the matrimonial property regime in Turkey will be explained: namely the jurisdiction issue in matrimonial property cases, the conflict of law rules regarding the applicable law in the matrimonial property regime before the competent Turkish courts and, finally, the matrimonial property regime under the Turkish Civil Code. Accordingly, both the legal matrimonial property regime and three contractual matrimonial property regimes that the spouses may choose under Turkish law will be described.

 

EP Paper on future of European Private International Law

In a workshop of the European Parliament’s JURI Committee on Upcoming issues of EU Law, that took place on 24th September, papers were presented on five selected topics: the application of EU Law (Wolfgang Heusel), the implementation of EU law (Marta Ballesteros), European private international law (Xandra Kramer), intellectual property law (Lionel Bently and Alfred Radauer) and regulating robotics (Andrea Bertolini and Erica Palmerini).The workshop focused on work that has been accomplished in the past and challenges for the current legislature (2014-2019). The compilation of papers is available here.

For those readers only interested in private international law, the paper entitled European private international law: the way forward, is also available here.

For those readers that did not know yet, early this summer ‘Codifying Choice of Law Around the World’ (OUP, 2014) authored by Symeon Symeonides, was published. One can only agree with Lawrence Collins in the foreword to this book that it is ‘a truly monumental contribution to the study of codification in the conflict of laws’.

The blurb reads:

9780199360840_140Codifying Choice of Law Around the World chronicles, documents, and celebrates the extraordinary, massive country-by-country codification of Private International Law (PrIL) or Conflict of Laws that has taken place in the last 50 years from 1962-2012. During this period, the world has witnessed the adoption of nearly 200 PrIL codifications, EU Regulations, and international conventions—-more than in all preceding years since the inception of PrIL. This book provides a horizontal comparison and discussion of these codifications and conventions, firstly by comparing the way they resolve tort and contract conflicts, and then by comparing the answers of these codifications to the fundamental philosophical and methodological dilemmas of PrIL. In the process, this book re-examines and dispels certain widely held assumptions about choice of law, and the art and science of codification in general.

More information is available here.

Issue 2014.1 Nederlands Internationaal Privaatrecht

The first issue of 2014 of the Dutch journal on Private International Law Nederlands Internationaal Privaatrecht includes an analysis of the Brussels I Recast and the influence on Dutch legal practice, an article on Child abduction and the ECHR,  and two case notes; one on the Impacto Azul case and one on the Povse case.

  • Marek Zilinsky, ‘De herschikte EEX-Verordening: een overzicht en de gevolgen voor de Nederlandse rechtspraktijk’, p. 3-11. The English abstract reads:

From 10 January 2015 onwards the Brussels I Recast (Regulation No. 1215/2012) shall apply. Under the new regulation which replaces the Brussels I Regulation (Regulation No. 44/2001), the exequatur is abolished and some changes are also made to provisions on jurisdiction and lis pendens. This article gives an overview of the changes effected by the Brussels I Recast compared to the proposed changes in the Proposal for a new Brussels I Regulation (COM(2010) 748 final). The consequences of the new regulation for Dutch practice are also dealt with briefly.

  • Paul Vlaardingerbroek, ‘Internationale kinderontvoering en het EHRM’, p. 12-19. The English abstract reads:

With the Neulinger/Shuruk decision in 2009, the European Court of Human Rights caused a great deal of misunderstanding and confusion among judges and academics, because in this case the ECHR seemed to protect the abductors of children and to allow them to benefit from their misconduct. After the Neulinger case some further ECHR decisions followed that seemed to compete with the fundamental purposes of the Hague Convention on child abduction, but in this paper I will try to show that in more recent cases the European Court has mitigated the hard consequences of the Neulinger/Shuruk decision and has given a new direction in how to proceed and decide when the two conventions seem to compete.

  • Stephan Rammeloo, ‘Multinationaal concern – Aansprakelijkheid van moedervennootschap voor schulden van dochtervennootschap: nationaal IPR (‘scope rule’) getoetst aan Europees recht (artikel 49 VWEU)’, p. 20-26. Case notes European Court of Justice 20-06-2013, Case C-186/12 (Impacto Azul), The English abstract reads:

In June 2013 the CJEU delivered a preliminary ruling under Article 49 TfEU with regard to the exclusion, under national law, of an EU Member State from the joint and several liability of parent companies vis-à-vis the creditors of their subsidiaries in a crossborder context. Article 49 TfEU does not prohibit any such exclusion resulting from a self-restricting unilateral scope rule under the national Private International Law of an individual EU Member State. The interpretative ruling of the Court does not, however, affect cross-border parental liability for company group members under Private International Law having regard to contractual or non-contractual (cf. tort, insolvency) liability.

  • Monique Hazelhorst, ‘The ECtHR’s decision in Povse: guidance for the future of the abolition of exequatur for civil judgments in the European Union’, p. 27-33. Case notes European Court of Human Rights 18 June 2013, decision on admissibility, Appl. no. 3890/11 (Povse v. Austria). The abstract reads:

The European Court of Human Rights’ decision on admissibility in Povse is worthy of analysis because it sheds light on the preconditions for the abolition of exequatur for judgments in civil matters within the European Union. The abolition of this control mechanism is intended to facilitate the free movement of judgments among Member States on the basis of the principle of mutual recognition. Concerns have however been expressed about the consequences this development may have for the protection of fundamental rights. The Human Rights Court’s Povse decision provides welcome guidance on the limits imposed by the European Convention on Human Rights on the abolition of exequatur. This case note analyses the preconditions that may be inferred from the decision. It concludes that the Human Rights Court’s approach leaves a gap in the protection of fundamental rights which the accession of the EU to the Convention intends to fill.

Nagy on the law of companies and freedom of establishment

Csongor István Nagy (Budapest University of Technology and Economics) has posted The Personal Law of Companies and the Freedom of Establishment Under EU Law. The Enthronement of the Country-of-Origin Principle and the Establishment of an Unregulated Right of Cross-Border Conversion, published in the Hungarian Yearbook of International Law and European Law 2013 on SSRN.

This paper presents, from a critical perspective, the development of the CJEU’s case-law on the collision between the personal law of companies and the freedom of establishment with special emphasis on the CJEU’s recent judgment in VALE.
It is argued that this ruling treats the incorporation theory as ‘the law of the land’, putting an end to the explanation that EU law does not establish a connecting factor, the determination of which is a Member State competence, but simply precludes some plights that frustrate the freedom of establishment. Furthermore, the case-law on the personal law of companies is put in the context of the country-of-origin concept as a general and fundamental principle of EU law. It is argued that although the incorporation theory fits better the system of the internal market characterised by free movement rights, as a general proposition, the categorical application of this principle to all fields of private law suppresses conflicts analysis and, as such, is a dubious development. Conflicts problems should receive a conflicts law answer. The oversimplified application of the country-of-origin principle, though certainly warranted in the field of public law, does away with private international law problems without carefully examining and adequately solving them.
Furthermore, it is also argued that in Cartesio and VALE the CJEU seems to have created an unregulated right of cross-border conversion. In Cartesio, the Court established a right of ‘departure’, i.e. companies have the right to move their seat to another Member State in order to convert into the legal person of the receiving country, while losing their original legal personality. In VALE, the CJEU seems to have established a right of ‘arrival’, derived from the principle of non-discrimination. However, EU law prescribes only the theoretical possibility of conversion (‘departure’ and ‘arrival’), and leaves the technicalities of this conversion to national law.

Issue 2013.4 Nederlands Internationaal Privaatrecht

The fourth issue of 2013 of the Dutch journal on Private International Law Nederlands Internationaal Privaatrecht includes two contributions on the Commission Recommendation on Collective Redress and an article on the obligations of parties with regard to pleading and contesting jurisdiction under the Brussels I Regulation in the Netherlands.

Astrid Stadler, ‘The Commission’s Recommendation on common principles of collective redress and private international law issues’, p. 483-488. The abstract reads:

For its new policy on collective redress the European Commission has chosen the form of a mere ‘Recommendation’ instead of a binding directive or regulation with respect to the violation of (consumer) rights granted under EU law. The Recommendation provides some basic principles on collective redress instruments which should be taken into account by the Member States when implementing injunctive or compensatory collective redress mechanisms. There is, however, no obligation for the Member States to implement such procedural tools. Despite the attempt at establishing common principles, the European legislature thus seems to accept a heterogeneous landscape of collective redress in Europe and has missed the opportunity to provide rules on international jurisdiction, recognition and the applicable law particularly designed for cross-border mass litigation. As a consequence forum shopping becomes even more important for plaintiffs in mass damage cases.

Mick Baart, ‘Implications of Commission Recommendation 2013/39 on common principles for collective redress. Can safeguards limit the potential for abuse without compromising the realization of policy goals?’, p. 489-498. The abstract reads:

The recent publication of Recommendation 2013/39 seeks to establish a common European approach to collective redress. In response to concerns that collective procedures may introduce opportunities for abuse, the European Commission included a number of procedural safeguards. However, can these safeguards limit the potential for abuse without hindering the achievement of policy goals? This article evaluates this question from the perspective of group formation since opt-out procedures have traditionally been perceived as an important factor in abusive practices. The Recommendation accordingly considers the use of opt-in procedures to be an essential safeguard against abuse. Nonetheless, the rejection of opt-out procedures appears to entail an inherent paradox as it reduces the potential for abuse but simultaneously presents significant obstacles to the effectiveness of collective procedures. Moreover, it could have unintended consequences for questions of private international law as Member States that actively use opt-out mechanisms are not obliged to comply with a non-binding Recommendation.

Jacques de Heer, ‘De stelplicht van eiser en gedaagde in geschillen voor de Nederlandse rechter over internationale bevoegdheid op grond van de EEX-Verordening’, p. 499-507. The English abstract reads:

In cross-border contentious proceedings, the plaintiff only has a conditional obligation to show that the court in which proceedings are brought has jurisdiction. This condition follows from Article 24 of the Brussels I Regulation, which deals with jurisdiction through submission to the forum. When the defendant wishes to contest the jurisdiction of the court, he is under no immediate obligation to argue why this is so. However, if the factual arguments put forward by the plaintiff to found the jurisdiction of (for example) the Dutch court remain uncontested, this court has to consider these facts when deciding on its jurisdiction. In so deciding, the court is not bound by the jurisdictional rules of the Brussels I Regulation as mentioned by the defendant. When the defendant only raises a defence of concurrent proceedings in another Member State, he is obliged to immediately state the relevant facts.

Publication book Resolving Mass Disputes

An interesting book entitled Resolving Mass Disputes. ADR and Settlement of Mass Claims, edited by Christopher Hodges (Centre for Social-Legal Studies, Oxford/Erasmus University Rotterdam) and Astrid Stadler (University of Konstanz/Erasmus University Rotterdam) has just been published (Edward Elgar, 2013).

The blurb reads:

The landscape of mass litigation in Europe has changed impressively in recent years, and collective redress litigation has proved a popular topic. Although much of the literature focuses on the political context, contentious litigation, or how to handle cross-border multi-party cases, this book has a different focus and a fresh approach.

Taking as a starting-point the observation that mass litigation claims are a ‘nuisance’ for both parties and courts, the book considers new ways of settling mass disputes. Contributors from across the globe, Australia, Canada, China, Europe and the US, point towards an international convergence of the importance of settlements, mediation and alternative dispute resolution (ADR). They question whether the spread of a culture of settlement signifies a trend or philosophical desire for less confrontation in some societies, and explore the reasons for such a trend.

Raising a series of questions on resolving mass disputes, and fuelling future debate, this book will provide a challenging and thought-provoking read for law academics, practitioners and policy-makers.

Contributors include: I. Benöhr, N. Creutzfeldt-Banda, M. Faure, D.R. Hensler, C. Hodges, J. Hörnle, J. Kaladjzic, X. Kramer, M. Legg, R. Marcus, A. Stadler, I. Tzankova, S. Voet, Z. Wusheng.

More information is available here.

Latest issue Nederlands Internationaal Privaatrecht (2013/3)

The third issue of 2013 of the Dutch journal on Private International Law, Nederlands Internationaal Privaatrecht, includes the usual overview of important Dutch and European case law, as well as three articles on the following topics: The functioning of the European Small Claims Procedure in the Netherlands; the EU Regulation on Succession and Wills; and Child Protection Measures against the background of Article 8 ECHR.

X.E. Kramer & E.A. Ontanu, The functioning of the European Small Claims Procedure in the Netherlands: normative and empirical reflections, p. 319-328. The abstract reads:

The European small claims procedure was the first uniform adversarial procedure in the EU, introduced to increase the efficiency and to reduce the costs of cross-border small claims litigation in the Member States. The European Commission regards this procedure as an important potential contribution to access to justice in order to resolve small claims disputes. However, there are clear signs that this procedure is seldom used and the Commission seeks to improve its attractiveness. This paper focuses on the implementation and application of this European procedure in the Netherlands. Normative and empirical research has been conducted to assess how this procedure is embedded in the Dutch legal order and how it actually functions in practice and is perceived by the judiciary. The question is whether, from the Dutch perspective, this procedure meets the objectives of providing a simple, fast and low-cost alternative to existing national procedures, while respecting the right to a fair trial. The paper concludes with several recommendations for improvement.

 P. Lokin, De Erfrechtverordening, p. 329-337. The English abstract reads:

This article focuses on (EU) Regulation No. 650/2012 dealing with the jurisdiction, applicable law, recognition and enforcement of decisions and the acceptance and enforcement of authentic instruments in matters of succession and the creation of a European Certificate of Succession. Is this Regulation, which shall be applicable to the succession of persons dying on or after 17 August 2015, a step forward for the Netherlands? In light of its application in the near future, the article gives a first introduction into the new rules and concentrates on some aspects of the Regulation which require more attention, such as the determination of one’s last habitual residence and the transitional provisions when the deceased has made a choice for the applicable law prior to 17 August 2015.

R. Blauwhoff, Kinderbeschermingsmaatregelen in de Nederlandse IPR-rechtspraak in het licht van artikel 8 EVRM, p. 338-345. The English abstract reads:

Both private international law and human rights instruments may affect parental and children’s rights in cross-border situations, yet reference to both types of instrument is seldom made in Dutch legal decisions regarding parental responsibilities. Accordingly, the aim of this article is foremost to explore the relationship between both types of instruments in cases other than child abduction cases on the basis of an analysis of (Dutch) case-law, since the entry into force of the 1996 Convention on the International Protection of Children (1st of May 2011) and under reference to developments in case-law of the European Court of Human Rights (ECtHR) with regard to Article 8 ECHR. It is ventured that courts should have greater regard for the human rights dimension underpinning private international law decisions, especially in cases where tension arises between the law of the state of the child’s present and former habitual residence. At the same time, the classic focus of the ECtHR on the accountability of national states sometimes falls short of taking into account the progress made in the field of cross-border co-operation in the ambit of the 1996 Hague Convention, especially in the area of cross-border contact arrangements.