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New EU conflict of laws rule for minimum wages in road transport on the way? – Background, state of affairs and implications of the 2017 EC proposal that is (still!) under negotiation
By Fieke van Overbeeke, Legal Counsel at the International Institute for International and Foreign Law – the Netherlands and research fellow at the University of Antwerp – Belgium.
On 31 May 2017 the European Commission launched a proposal to adopt a special conflict-of-laws rule that determines (i.a.) which minimum wages apply to the highly mobile cross-border working activities of lorry drivers (COM 2017, 278). After more than three years of heavy debate, this proposal was profoundly modified and the Council and the European Parliament still do not find each other, leaving many aspects to be still worked out (see also the Legislative Train on the European Parliament’s website). The purpose of this piece is to give an overview of the background of this proposal, the current state of affairs and the possible influence of a special conflicts-of-law rule on the sector from a conflict-of-laws perspective.
The background of this proposal can be traced back to the unfair competition that has arisen in the EU road transport sector as a result of the enlargements of the EU to central and eastern EU Member States (in 2004, 2007 and 2013). This has led to a tripled increase in minimum wage differences between EU Member States. Given that labour costs are the largest expense in the provision of transport services, this creates a major competitive advantage for providers from low-wage EU member states.
In fifteen years, this has caused a metamorphosis of the road transport sector, with Eastern EU Member States now leading the lists of the largest transport providers in the EU. Several Western EU Member States, such as Germany and France, have responded to this competitive pressure by adopting their own national minimum wage legislation to be applied to transport operations on their territory. As a result, the EU road transport sector has become severely fragmented and the social position of drivers has been put under pressure. How could this have gone so wrong?
In the EU we have always agreed that it is not sustainable or responsible to allow competition that is purely based on labour costs. To this end, we have introduced minimum wages within the national borders and EU-wide we have developed the so-called ‘Posting of Workers Directive’ (1996/71). This Directive stipulates, amongst other things, that the minimum wages of the temporary country of employment must be applied if this is more favourable for the employee. In this way, it is ensured that efficient and innovative market players can actually compete on this efficiency and innovation (and thus not only on wage costs).
However, the Posting of Workers Directive did not come about with regard to road transport, but mainly with regard to the construction sector, where various social/economic problems arose in the 1990s. As a result, the Directive is very difficult to apply to the atypical and highly mobile road transport sector and this has led to widely divergent interpretations in the Member States, in many cases simply not enforcing the Directive at all with regard to this sector. In practice, this allows for direct competition on labour costs, with all its undesirable consequences as described above.
The EU legislator now wants to put an end to this situation by developing a special conflict-of-laws rule for minimum wages in road transport, which, among other things, determines to which transport operations the Posting of Workers Directive does and does not apply. The contrasts between Western and Eastern EU Member States, but also to some extent between central and peripheral Member States, makes for a lengthy legislative process lasting more than three years.
On 12 December 2019 the European Commission, the European Council and the European Parliament have reached a provisional agreement about some important aspects of the conflicts-of-law rule, which was approved to a certain extent within the institutions themselves in the following months: on 21 January 2020 the Parliament’s TRAN Committee accepted the provisional agreement informally by letter to the other institutions, the Council then adopted an official position on 7 April 2020 and the Commission gave its approval to the Council’s position on 14 April 2020 (subject to a number of matters not relevant here).
This looked very promising, but on 8 June 2020 the TRAN Committee suddenly threw a spanner in the works: the TRAN Committee adopted some severely different amendments compared to the position of the Council. If the plenary approves this, the negotiations will become very difficult. Yet, in this controversial legislative procedure it would not be the first time that the plenary rejects the position of the TRAN committee. To be continued!
If we take a closer look at the official position of the Council, a number of things stand out. Firstly, it is made clear that the mere crossing of a territory by lorries, also known as ‘transit’ operations, is excluded from the scope of the Posting of Workers Directive and that therefore the minimum wages of the crossed territory may not be applied to these activities. These operations are considered to be insufficiently closely connected to this territory and by extension the application of the minimum rates of pay cannot be justified.
On the other hand, the proposal provides that activities that remain within a certain territory, e.g. transport by a Polish transport company between The Hague and Rotterdam, also referred to as ‘cabotage’ operations, do fall within the scope of the Posting of Workers Directive and must therefore be subject to the minimum wages of the country where the cabotage is carried out from the first moment of the operation and if this is more favourable for the employee. These operations are deemed to have a connection only with the territory on which the cabotage is carried out and the application for these minimum rates of pay is therefore justified. In short: green light for transit operations and red light for cabotage operations.
So far the newly adopted amendments of the TRAN committee from the European Parliament on 8 June 2020 are largely in accordance with this.
But what about those intermediate forms of transport, such as bilateral transport operations between Member States A and B, or so-called ‘crosstrade’ operations carried out by a transport company from Member State A between Member States B and C? This is a lot more complicated and has been a hot issue in the legislative negotiations. Ultimately, the Council agreed to exempt bilateral transport operations, whether or not in combination with a maximum of two consecutive operations, from the Posting of Workers Directive, and therefore the minimum wages may not be applied to these operations. Crosstrade, on the other hand, must, according to the proposal, fall under the Posting of Workers Directive and are therefore subject to the minimum wages, from the first moment of this operation and if this is more favourable to the employee.
This does not sit well with the TRAN Committee, which states in its recently adopted amendments that: 1) on the one hand there should be much more possibilities to combine a bilateral transport with other transport operations and 2) on the other hand that a ‘certain number of cross-trade operations should be exempted from posting rules.’ The TRAN Committee thus opts for a much more liberal point of view. It seems that the Corona crisis also exerted influence on the discussions: many East-European Member States now regress to the argument that the road transport sector already severely suffers from the Corona crisis and point to the pivotal importance of the delivery of medicine and goods, which should release transport companies from the obligation to safeguard the social protection of their drivers.
Whatever the outcome of the negotiations, it is already clear that if a special conflict of laws rule for road transport will be adopted, it can be seen as a real ‘game changer’ for the sector since it would bring much more legal certainty regarding the application of the Posting of Workers Directive. Regarding some transport operations, internationally operating transport companies will have to take serious notice of the minimum wages they have to guarantee their drivers. Non-compliance with this new legislation is strongly discouraged: along with the new posting rules, the EU legislator aims to provide for a whole package of enforcement and control measures that are mandatory for the Member States and in which, for the first time, the EU legislator also keeps aspects under its own control.
New enforcement authorities should also be taken into account. In addition to possibly setting up a European road transport agency in the future, the more general European Labour Authority (ELA) has been set up in 2019, with the true mandate ‘to promote fair labour mobility within the EU’. It is expected that the ELA will be able to play a far-reaching role, unprecedented in the history of the EU, in the enforcement of social legislation; including in the road transport sector.
See for more information on this topic my recent article ‘Posting drivers in the EU road transport sector’, ERA Forum 2020 (freely available online). For those who read Dutch, see my PhD ‘Sociale concurrentie en conflictenrecht in het Europees wegtransport’, University of Antwerp 2018 (freely available online).
* The author is a member of the Hague-based ‘International Institute of International and Foreign Law’: www.iji.nl, which has been providing legal consultancy to professionals (judges, lawyers, notaries, mediators etc.) regarding private international law and foreign law for over a hundred years.
A few thoughts on the Guide to Good Practice on the grave-risk exception (Art. 13(1)(b)) under the Child Abduction Convention, through the lens of human rights (Part I)
Written by Mayela Celis – The comments below are based on the author’s doctoral thesis entitled “The Child Abduction Convention – four decades of evolutive interpretation” at UNED
As mentioned in a previous post, after many years in the making, the Guide to Good Practice on the grave-risk exception (Article 13(1)(b)) under the Child Abduction Convention (grave-risk exception Guide or Guide) has been published. Please refer to our previous posts here and here. This Guide to Good Practice deals with a very controversial topic indeed. The finalisation and approval of this Guide is without a doubt a milestone and thus, this Guide will be of great benefit to users.
For ease of reference, I include the relevant provision dealt with in the Guide. Article 13(1)(b) of the Child Abduction Convention sets out the following: “Notwithstanding the provisions of the preceding Article, the judicial or administrative authority of the requested State is not bound to order the return of the child if the person, institution or other body which opposes its return establishes that – […] b) there is a grave risk that his or her return would expose the child to physical or psychological harm or otherwise place the child in an intolerable situation. […]” (our emphasis).
The comments on the grave-risk exception Guide will be divided into two posts. In the present post, I will analyse the Guide exclusively through the lens of human rights. In the second post, I will comment on some specific legal issues of the Guide but will also touch upon on some aspects of human rights law. These posts reflect only my personal opinion. Given the controversial nature of this topic, there might be other different and valid opinions out there so please bear that in mind.
At the outset, it should be noted that this Guide is only advisory in nature and thus nothing in the Guide may be construed as binding upon Contracting Parties to the 1980 Convention (and any other HCCH Convention) and their courts (paras 7 and 8 of the Guide) Therefore, courts have enough leeway to supplement it and take on board what they see fit.
Human rights law is gaining importance every day, also in private international law cases. However, apart from some fleeting references to the United Nations Convention on the Rights of the Child (pp. 16 and 56), there are no references to human rights case law in the Guide. Indeed, the increasing number of judgments of the European Court of Human Rights (ECtHR) is not mentioned in the Guide, even though dozens of these judgments have dealt with the grave-risk exception (Art. 13(1)(b)) of the Child Abduction Convention); thus there appears to be an “elephant in the room”. We will try to respond in this post to the following questions: what has been the contribution of the ECtHR on this topic and what are the possible consequences of the absence of references to human rights case law in the Guide.
In this regard, I refer readers to our previous post regarding the interaction of human rights and the Child Abduction Convention here and my article entitled: The controversial role of the ECtHR in the interpretation of the Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction, with special reference to Neulinger and Shuruk v. Switzerland and X v. Latvia (in Spanish only but with abstracts in English and Portuguese in the Anuario Colombiano de Derecho Internacional). To view it, click on “Ver artículo – descargar artículo”, currently pre-print version, published online in March 2020.
Before going into the substance of this post, it is perhaps important to clarify why the case law of the ECtHR in child abduction matters is of such great importance in Europe and beyond, perhaps for the benefit of our non-European readers. First, in addition to being binding upon 47 States party to the European Convention on Human Rights, which represent about half of the total number of Contracting Parties to the Child Abduction Convention (45%), the case law of the ECtHR not only applies to child abduction cases between European States. It will also apply, for example, if the requested State in child abduction proceedings is a party to the European Convention on Human Rights and the requesting State is not. Indeed, the geographical location of the requesting State and whether it is a party to the European Convention on Human Rights are not relevant. See for example, Neulinger and Shuruk v. Switzerland (Application No. 41615/07), Grand Chamber, where the requesting State was Israel, and X v. Latvia (Application No. 27853/09), Grand Chamber, where the requesting State was Australia, both of which are not a party to the European Convention. Secondly, not only European citizens can launch proceedings before the ECtHR. All of this is nicely summarised in Article 1 of the European Convention on Human Rights, which sets out that “The High Contracting Parties shall secure to everyone within their jurisdiction the rights and freedoms defined in Section I of this Convention” (our emphasis).
In X v. Latvia, the Grand Chamber of the ECtHR has established a legal standard in the handling of child abduction cases where the 13(1)(b) exception has been raised (and indeed other exceptions of the Child Abduction Convention such as Articles 12, 13(1)(a), 13(2) and 20), which is the following:
“106. The Court [ECtHR] considers that a harmonious interpretation of the European Convention and the Hague Convention (see paragraph 94 above) can be achieved provided that the following two conditions are observed. Firstly, the factors capable of constituting an exception to the child’s immediate return in application of Articles 12, 13 and 20 of the Hague Convention, particularly where they are raised by one of the parties to the proceedings, must genuinely be taken into account by the requested court. That court must then make a decision that is sufficiently reasoned on this point, in order to enable the Court to verify that those questions have been effectively examined. Secondly, these factors must be evaluated in the light of Article 8 of the Convention (see Neulinger and Shuruk, cited above, § 133).” (our empahsis)
[…]
“118. As to the need to comply with the short time-limits laid down by the Hague Convention and referred to by the Riga Regional Court in its reasoning (see paragraph 25 above), the Court reiterates that while Article 11 of the Hague Convention does indeed provide that the judicial authorities must act expeditiously, this does not exonerate them from the duty to undertake an effective examination of allegations made by a party on the basis of one of the exceptions expressly provided for, namely Article 13 (b) in this case.” (our emphasis)
In addition, the ECtHR indicates that domestic courts must conduct “meaningful checks” to determine whether a grave risk exists (paragraph 116 of X v. Latvia), and to do so a court may obtain evidence on its own motion if for example, this is allowed under its internal law.
Importantly, this case also underlines the need to secure “tangible” measures of protection for the return of the child (paragraph 108 of X v. Latvia).
Moreover, there are at least two issues in the Guide that could have benefited from a human rights analysis, namely the incarceration of (mainly) the abducting mother upon returning the child to the State of habitual residence and the separation of siblings.
With regard to the first issue, it should be noted that the fact that the mother will be incarcerated upon returning the child to the State of habitual residence could have serious consequences for the child. The Guide has correctly explained the different ways in which such an outcome could be avoided. However, the Guide concludes with the following: “The fact that the charges or the warrant cannot be withdrawn is generally not sufficient to engage the grave risk exception” (paragraph 67).
In my view, where objective reasons have been raised by the mother to refuse to return to the State of habitual residence, such as incarceration, there should be a human rights analysis in the light of Article 8 of the European Convention on Human Rights. While there might be some cases where incarceration may not be sufficient to refuse a return, there might be other cases where this would place the taking parent and the child in grave risk of harm or intolerable situation. By way of example, objective reasons for not returning could include a long incarceration or a disproportionate sanction, the fact the other parent cannot take care of the child upon the incarceration of the other parent, the inability to contest custody while imprisoned, etc. According to the ECtHR, an analysis should be undertaken as to whether these actions are necessary in a “democratic society”. Accordingly, the decision of the mother not to return based on a whim should not be considered seriously. See, for example, the ECtHR cases, Neuliger and Shuruk v. Switzerland (Application No. 41615/07), Grand Chamber (as clarified by X v. Latvia (Application No. 27853/09), Grand Chamber)), and B. c. Belgique (Requête No. 4320/11). Arresting and handcuffing the mother at the airport has undoubtedly a tremendous impact on children; so all efforts should be geared via judicial co-operation and direct judicial communications to make sure that charges are dropped as mentioned in the Guide (first part of paragraph 67 of the Guide).
As regards the second scenario, it is important to note that the separation of siblings when one of them has successfully objected to being return under Article 13(2) of the Child Abduction Convention may inflict harm on the children and may be difficult to enforce. The Guide noted that every child should be considered individually and concluded that “Consequently, the separation of the siblings resulting from the non-return of one child (regardless of the legal basis for the non-return) does not usually result in a grave risk determination for the other child” (paragraph 74).
According to article 12 of the UN Convention on the Rights of the Child, the views of the child should be given due weight in accordance with the age and maturity of the child. By ordering the return of usually the younger sibling(s) and forcing the mother to make a choice between returning with one child and staying with the child who objected, a judge could not be giving enough weight to the views of the child objecting to being returned. This is especially the case when we are dealing with full siblings and all are subject to return proceedings. In my view, and given that the reason for not returning are the views, in particular, of the older child, this should be factored in when the judge exercises his or her discretion. See, for example, the ECtHR case, M.K. c. Grèce (Requête n° 51312/16). Obviously, if the separation of siblings is due to the action of the mother by not wanting to return, then a separation of the siblings would most likely not be a ground for refusing the return.
The underlying basis of the above is that the Child Abduction Convention is for the protection of children and not to vindicate the position of adults who are immersed in a legal battle or to merely sanction the abductor.
The standard in X v. Latvia should be kept in mind when dealing with international child abduction cases. Given that the grave-risk exception Guide is silent on this, practitioners would need to supplement the Guide with relevant literature and case law on human rights if they are dealing with a case in Europe. Practitioners outside Europe having a child abduction case which is being resolved in Europe may need to do the same in order to know what their possibilities of success and options are.
In this day and age, and as mentioned by the honorable Eduardo Vio Grossi, judge of the Inter-American Court of Human Rights, in a recent virtual forum (“Challenges to Inter-American Law”), the focus should not only be on sanctioning States for violations of human rights but we should assist States in not getting sanctioned by providing the necessary guidance and if possible, paving the way.
Application of the Brussels I bis Regulation ratione materiae, interim relief measures and immunities: Opinion of AG Saugmandsgaard Øe in the case Supreme Site and Others, C-186/19
Written by María Barral Martínez, a former trainee at the European Court of Justice (Chambers of AG Campos Sánchez-Bordona) and an alumna of the University of Amsterdam and the University of Santiago de Compostela
The Hoge Raad Neederlanden (The Dutch Supreme Court), the referring court in the case Supreme Site Service and Others, C-186/19, harbours doubts regarding the international jurisdiction of Dutch courts under the Brussels I bis Regulation, in respect to a request to lift an interim garnishee order. An insight on the background of the case can be found here and here, while the implications of that background for admissibility of request for a preliminary ruling are addressed in section 1 of the present text.
In replying to a preliminary ruling request made by that court, AG Saugmandsgaard Øe issued his Opinion. Advocate General concluded that a flexible approach should be taken when interpreting the concept of “civil and commercial matters” within the meaning of Article 1(1) of the Brussels I bis Regulation. AG was of the view that an action for interim measures as the one brought by SHAPE, aimed at obtaining the lifting of a garnishee order, qualifies as civil and commercial matters, within the meaning of Article 1(1), provided that such garnishee order had the purpose of safeguarding a right originating in a contractual legal relationship which is not characterised by an expression of public powers, a matter that is left to the referring court to verify. For presentation of AG reasoning and its analysis in relation to interim measures, see section 2.
Moreover, according to AG, alleged claims of immunity enjoyed under international law by one of the parties to the proceedings had no significance, when it comes to the analysis of the material scope of the Brussels I bis Regulation. Against this background, the case provides a good opportunity to explore jurisdictional issues in the face of immunities, such as the debate regarding international jurisdiction preceding the assessment of immunities, and what can be inferred from the case-law of the Court of Justice and the European Court of Human Rights in that respect. Next, it requires us to determine whether the case-law developed in relation to State bodies and their engagement in acta iure imperii can be applied mutatis mutandis to the international organisations. Finally, it revives the concerns on whether the scope of the Brussels I bis Regulation should be determined in a manner allowing to establish international jurisdiction under that Regulation even though enforcement against public authorities stands little chances, be that international organisations as in the present case. These issues are discussed in section 3.
1. Admissibility of the preliminary reference
Advocate General Saugmandsgaard Øe made some remarks on the admissibility of the preliminary ruling and on whether a reply of the Court of Justice would be of any avail to the referring court.
It should be recalled that at national level, two sets of proceedings were initiated in parallel. In the first set, – the proceedings on the merits – Supreme, the private-law companies, sought a declaratory judgment that it was entitled to the payment of several amounts by SHAPE, an international organisation. These proceedings were under appeal before the Den Bosch Court of Appeal because SHAPE challenged the first instance court’s jurisdiction. In the second set – the proceedings for interim measures where the preliminary ruling originated from – SHAPE brought an action seeking the lift of the interim garnishee order and requesting the prohibition of further attempts from Supreme to levy an interim garnishee order against the escrow account.
In the opinion of AG, the preliminary ruling was still admissible despite the fact that the Den Bosch Court of Appeal ruled on the proceedings on the merits granting immunity of jurisdiction to SHAPE in December 2019 – the judgment is under appeal before the Dutch Supreme Court. He opined that the main proceedings should not be regarded as having become devoid of purpose until the court renders a final judgment on the question whether SHAPE is entitled to invoke its immunity from jurisdiction, in the context of the proceedings on the merits and whether that immunity, in itself, precludes further garnishee orders targeting the escrow account (point 35).
2. Civil and commercial matters in respect of substantive proceedings or interim relief proceedings?
The Opinion addressed at the outset the question on whether the substantive proceedings should fall under the material scope of the Brussels I bis Regulation in order for the interim relief measures to fall as well within that scope. As a reminder, the object of the proceedings on the merits, is a contractual dispute over the payment of fuels supplied by Supreme to SHAPE, in the context of a military operation carried out by the latter.
As AG signalled, to answer the question several hypotheses have been put forward by the parties at the hearing held at the Court of Justice. The first hypothesis, supported by the Greek Government and Supreme, proposed that in order to determine if an action for interim measures falls within the scope of the Regulation, the proceedings on the merits should fall as well under the material scope of the Regulation. In particular, the characteristics of the proceedings on the merits should be taken into account. The second hypothesis, supported by SHAPE, considered that the analysis should be done solely in respect to the proceedings for interim measures. The European Commission and the Dutch and Belgian Governments opined that in order to determine if the action for interim measures can be characterised as civil and commercial matters, it is the nature of the right which the interim measure was intended to safeguard in the framework of the interim relief proceedings that matters.
Endorsing the latter hypothesis, AG indicated that an application for interim measures cannot be regarded as automatically falling within or outside the scope of the Brussels I bis Regulation, depending on whether or not the proceedings on the merits fall within that scope, simply because it is ancillary to the proceedings on the merits (point 51). To support his conclusion, AG followed the line of reasoning developed by the Court in the context of the instruments preceding the Brussels I bis Regulation. In that regard, the Court has held that to ascertain that provisional/protective measures come within the scope of the Regulation, it’s not the nature of the measures that should be taken into account but the nature of the rights they serve to protect. To illustrate this: in Cavel I, the Court held that interim measures can serve to safeguard a variety of rights which may or may not fall within the scope of the now Brussels I bis Regulation (then the Brussels Convention) depending on the nature of the rights which they serve to protect. This has been confirmed in Cavel II: “ancillary claims accordingly come within the scope of the Convention according to the subject-matter with which they are concerned and not according to the subject-matter involved in the principal claim”. Further, in Van Uden, the Court held that “provisional measures are not in principle ancillary to arbitration proceedings but are ordered in parallel to such proceedings and are intended as measures of support. They concern not arbitration as such but the protection of a wide variety of rights”. This case-law has been also confirmed in recent judgments of the Court, namely in Bohez – where a penalty payment was imposed as a measure to comply with the main judgment – and Realchemie Nederland concerning an action brought for alleged patent infringement in the context of interim proceedings, where a prohibition in the form of payment of a fine was ordered.
In brief, what matters in this discussion on interim measures falling or not within the scope of the Brussels I bis Regulation, is not the relation between the main proceedings and the interim measures, the crucial factor being the purpose – determined from a procedural law standpoint – of the interim relief measure vis-à-vis the proceedings on the merits: an interim measure falling within the scope of the Regulation has to safeguard the substantive rights at stake in the main proceedings. In the present case, the substantive right in question is a credit arising from a contractual obligation that Supreme holds against SHAPE.
3. Whether immunities play a role in determining if an action can qualify as “civil and commercial matters” within the meaning of Article 1(1) of the Regulation
One of the particularities of the case is that in the second set of proceedings where the preliminary ruling originated, SHAPE and JFCB (NATO) have introduced an action for interim relief measures, based on immunity from execution. SHAPE alleged that its immunity from execution flowing from the 1952 Paris Protocol trumps any jurisdiction derived from that Regulation.
It is against this background that the Dutch Supreme Court asked the Court of Justice if the fact that an International Organisation claims to enjoy immunity from execution under public international law, bars the application of the Brussels I bis Regulation or has an impact on its application ratione materiae. In his Opinion, Advocate General considered that the referring court is concerned by the actions relating to “acts or omissions in the exercise of state authority” linked to the concept of “acta iure imperii” – a concept which is also used in international law in relation to the principle of State immunity.
The Opinion tackled the question of immunities under public international law and concluded that a dispute where an International Organisation is a party, should not be automatically excluded from the material scope of the Brussels I bis Regulation. Interestingly, some aspects of the reasoning that allowed to reach that conclusion echo the doctrinal debates on the interplay between the jurisdictional rules of EU private international law, on the one hand, and the immunity derived from public international law, on the other hand.
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Does immunity precede the jurisdiction under EU PIL?
At point 72, AG rejected the arguments advanced by the Austrian Government, who argued that the Brussels I bis Regulation should not apply to the case at hand. In the view of this government, if an international organisation takes part in a dispute, the immunity that this organisation enjoys on the basis of customary international law or treaty law, characterizes the nature of the legal relationship between the parties. In other words, a criterion based on the nature of a party (scil. the fact that it is an international organization that is a party to proceedings) should suffice to decline jurisdiction under the Brussels I regime.
In that respect, AG made some interesting remarks: first, by applying the Brussels I bis Regulation to a dispute where an International Organisation is a party, there is no breach of Article 3(5) TUE and of the obligation to respect public international law enshrined in that provision. Second, if, based on the Brussels I bis regime, a national court declares its international jurisdiction over a dispute, potential immunity claims advance by the parties will not be affected, as they are to be considered at a later stage of the proceedings. AG departed from the premise that the assessment on immunities should take place after the national judge seised with the case looks into the substance of the merits, including party allegations. This is therefore, at a second stage, after the national court has decided over its international jurisdiction within the first stage, that the immunity needs to be ascertained and its limits set (point 69).
This approach resonates with the idea that national courts are not supposed to engage in an in-depth analysis of the substance at that very first stage, when they are determining their own jurisdiction. They should not be undertaking a mini-trial, ascertaining jurisdiction requires only a first approximation to the facts of the case, solely for the purpose of determining jurisdiction. In FlyLaL II, a case concerning jurisdictional issues pursuant to the Brussels I Regulation, in respect of an action for damages brought for infringement of competition law, the Court observed that at the stage of determining jurisdiction “the referring court must confine itself to a prima facie examination of the case without examining its substance”. The statement draws on AG Bobek’s Opinion presented in the aforementioned case: “[d]etermination of jurisdiction should be as swift and easy as possible. Thus, a jurisdictional assessment is by definition a prima facie one. […] The jurisdictional assessment will, in practice, require a review of the basic factual and legal characteristics of the case at an abstract level.”
From the ECtHR case-law (see, most notably, Waite and Kennedy v. Germany) dealing with immunities of international organizations and the right to a remedy enshrined in Article 6 ECHR, a similar reading can be extracted. National courts deciding on granting of an immunity – be [it] immunity of jurisdiction or from execution – and performing the “reasonable alternative means” test, inevitably engage in a substantive analysis of the merits. To ensure that the claimant’s right to access justice is not breached, requires more than an abstract examination of the facts. This would seem to favour the idea that determination of international jurisdiction precedes a substantive analysis of the circumstances of the case in respect to any alleged claim of immunities made by the parties.
However, it is still not clear how this reasoning can be reconciled with judgments of the Court of Justice in the cases Universal Music International Holding and Kolassa. There, the Court of Justice held that according to the objective of the sound administration of justice which underlies the Brussels I Regulation, and respect for the independence of the national court in the exercise of its functions, a national court in the framework of ascertaining its international jurisdiction pursuant to the Brussels I regime, must look at all the information available to it. Although such an assertion seems to be construed in very general terms, one may well wonder what exactly a court assessing its international jurisdiction under the Brussels I bis Regulation is required to look at. Should it be a minimal review of the substance or a prima facie analysis strictly focused on the nature of the elements of the action – relevant in the context of the connecting factors used by the rules on jurisdiction –,including all the information available before the court?
If the answer would be the latter, that means that in the case at hand, the immunity from execution relied on by SHAPE in support of its action should be taken into account.
A reading of paragraphs 53 to 58 in the Court of Justice’s recent judgment in Rina, hints that in order to establish its own jurisdiction under the Brussels I bis Regulation, a national court has to take into consideration all available information. In the case at issue, party allegations where a party (Rina) invokes immunity of jurisdiction. While at first glance this instruction does not steer away from the judgments in Universal Music International Holding and Kolassa, what the Court proposes here is definitely more complex than a first approximation to the facts of the case. At paragraph 55 the Court notes “a national court implementing EU law in applying [the Brussels I Regulation] must comply with the requirements flowing from Article 47 of the Charter. […] The referring court must satisfy itself that, if it upheld the plea relating to immunity from jurisdiction, [the claimants] would not be deprived of their right of access to the courts, which is one of the elements of the right to effective judicial protection in Article 47 of the Charter.” If the national courts were to engage in such analysis – in a similar fashion as the ECtHR established in regards to Article 6 ECHR – it will certainly go beyond a mere examination in abstracto, implying rather a deep dive on the merits.
Moreover, the judgment in Rina seems to suggest that the analysis of international law cannot be avoided even when it comes only to the question whether the Brussels I regime applies or not. At paragraph 60, the Court of Justice explained “[t]he principle of customary international law concerning immunity from jurisdiction does not preclude the national court seised from exercising the jurisdiction provided for by that regulation in a dispute relating to such an action, where that court finds that such corporations have not had recourse to public powers within the meaning of international law.” Again, for the examination of these matters in the framework of determining international jurisdiction, a greater level of scrutiny is required. A national judge would have to dig dipper in the facts and party allegations to come to the conclusion that a certain party did not have recourse to public powers. Something that is everything but a swift and easy exercise.
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Does the case-law developed in the context of State bodies apply to international organisations?
Be that as it may, while an immunity claim does not automatically rule out the application of the Brussels I bis Regulation according to AG Saugmandsgaard Øe, the key question in his analysis is to determine if actions related to acta iure imperii under Article 1(1) of the Regulation are applicable to international organisations. It flows from the Court of Justice well-settled case-law that disputes between a State body and a person governed by private law come within the scope of civil and commercial matters, if the public authority in question does not act in the exercise of its public powers. At point 75 of his Opinion, AG made a reference to the judgment in Eurocontrol and indicated that exceptions under Article 1(1) in fine can extend to acts and omissions carried out by an international organisation. He remarked that, the concept of “public powers” established under the Court’s case-law, not only relates to State responsibility but refers also to those situations where a public authority acts under the umbrella of its public powers.
Advocate General moved then to analyse the Court of Justice case-law concerning liability of the State for acts and omissions carried out in the exercise of sovereign authority. Here matters get a bit complicated.
On the one hand, it remains to be seen how that case-law could be applied mutatis mutandis to international organisations. Leaving aside the question of immunities and putting emphasis on the notion of “civil and commercial matters” within the meaning of Article 1(1) of the Brussels I bis Regulation, the acts and omissions of an international organization are strictly connected with the powers conferred to the organisation for its proper functioning. Thus, one could wonder whether a functional test would be more suitable to determine if the acts or omissions were carried out by an international organization in the exercise of its public powers: a demarcating line could be drawn between non-official (non-related to the mission of the organization) acts and omissions and those of official nature, therefore necessary to fulfil the organisation’s mandate.
On the other hand, concerning the criteria applied by the Court when analysing if a public authority has exercised its powers of State authority, there is no “one size fits all” solution. As AG rightly pointed out at point 84 of his Opinion, the Court has still to sort out the interplay between different criteria: matters characterising the legal relationship between the parties, the subject-matter of the dispute and the basis of the action and the detailed rules governing the action brought.
To illustrate this point: in Préservatrice Foncière TIARD, the Court looked mainly at the legal relationship between the parties, while in Baten and Sapir and Others the Court did not refer to the legal relationship between the parties but focused on the subject-matter of the dispute and the basis of the action brought. Hence, the alternative or cumulative use of these criteria – or a flexible one- seem to reflect the need to provide an adequate response to the case-specific factual context of a particular case.
In that sense, AG pointed out that the criterion concerning the basis of the action is not relevant in all cases, it will be determinant in situations where is not established that the substantive basis of the claim is an act carried out in the exercise of public powers. For that reason, at 90, AG considered more appropriate that the action is based on a right originating from an act of public authority or in a legal relationship characterized by a manifestation of public power.
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Does the perspective of anticipated recognition/enforcement influence the interpretation of the notion of “civil and commercial matters”?
It is worth mentioning that some commentators (see also Van Calster, G., European Private International Law, Hart Publishing, 2016, p. 32) pointed out that, in the light of the judgment in Eurocontrol, the scope of application of the Brussels I bis Regulation should be interpreted by taking into account the perspectives of recognition and enforcement. Thus, if immunity bears no significance at the stage of determining jurisdiction, but it is later granted/recognised resulting in refusal of recognition and/or enforcement, concerns are raised regarding what is the practical use of exercising jurisdiction under the Brussels I bis Regulation against public authorities when there are little chances of recognition/enforcement.
On this point, the Spanish Supreme Court – in a case concerning the enforcement of a judgment rendered in Germany in favour of a private party against the Republic of Argentina –, held that a declaration of enforceability issued in relation to a general enforcement order does not breach the rules on immunity of execution. The Spanish Court precised that only when specific legal attachment measures are taken, a court should determine if the property in question is subject to execution. Thus, the issue of immunity of execution and the assessment whether the property to be executed is for commercial or official purposes would be at stake at a second stage of the enforcement procedure, not interfering with the application of the Brussels I regime.
News
Conference Sustaining Access to Justice, 19-20 Oct 2023 – registration open
On 19-20 October 2023 the Conference Sustaining Access to Justice in Europe: New Avenues for Costs and Funding will take place at Erasmus University Rotterdam. Speakers from academia, policy, business and consumer associations from Europe, the US and Asia will discuss developments in funding, including third-party litigation funding and crowdfunding, collective actions, public interest litigation, ADR and ODR and entrepreneurial lawyering.
Description
Access to civil justice is of paramount importance for enforcing citizens’ rights. At the heart access to civil justice lies litigation funding and cost management. Yet, over the past decades, access to justice has been increasingly put under pressure due to retrenching governments, high costs of procedure, and inefficiency of courts and justice systems. Within this context, the funding of litigation in Europe seems to be shifting from public to private sources. Private actors and innovative business models have emerged to provide new solutions to the old problem of financial barriers to access to justice.
With the participation of academics, policymakers, practitioners, academics and representatives of civil society from all over Europe and beyond, the conference seeks to delve deeper into the financial implications of access to justice and the different ways to achieve sustainable civil justice systems in Europe. The topics addressed in this international academic conference include different methods of financing dispute resolution and regulating costs, such as third-party funding, crowdfunding, blockchain technologies, public interest litigation, developments in ADR/ODR, new business models of legal professionals as well as law and economics perspectives on litigation funding.
Program, registration and call for papers
The full program is available here and further information and registration is available here.
A call for papers for early career researchers is available here; deadline is 7 July 2023.
This conference is organised by Erasmus School of Law in the context of the NWO Vici Project: ‘Affordable Access to Justice’, funded by the Dutch Research Council.
Private International Law and the Voices of Children
Written by Christina Shin, University of Sydney Law School
On 1 June 2023, International Children’s Day, an online webinar discussing the issue of children’s protection in private international law (PIL) was organized in collaboration with conflictoflaw.net and American Society of International Law Private International Interest Group at the Sydney Law School Centre for Asian and Pacific Law (CAPLUS). In the first part of the webinar, five experts were invited to share their views on the status quo, challenges, and potential solutions to protect the welfare of children in the international and transnational context. The second part of the webinar involved a roundtable discussion among the experts. This event was moderated by Dr. Jeanne Huang, Associate Professor at the Sydney Law School and CAPLUS co-director. The guest speakers were as follows:
Today the Mexican National Code of Civil and Family Procedure has been published in the Official Gazette
On 6 June 2023, the Mexican National Code of Civil and Family Procedure has been passed by decree issued by the Mexican president Andrés Manuel López Obrador. Indeed, after many years of stagnation, the National Code has finally been published today in the Mexican Federal Official Gazette. See here. It will enter into force tomorrow (see article 1 of the transitory articles).
This is a groundbreaking development because it will gradually replace the states codes of civil and family procedure in Mexico, harmonising procedural law in all 32 Mexican states. A specific procedure has been foreseen for the way in which it will be adopted in the Mexican states (see article 2 of the transitory articles).
There are many interesting provisions for Private International Law lawyers, we will be preparing a brief summary, which will be published here. By way of example, see the provisions on international child abduction: articles 1150-1161.