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Report on Annual Conference on Consumer Law organized by ERA with specific highlights of the recent Representative Actions Directive
This report has been prepared by Priyanka Jain, a researcher at the Max Planck Institute Luxembourg for International, European and Regulatory Procedural Law, and Ph.D. candidate at the University of Luxembourg.
Introduction:
On 8-9 October 2020, ERA – the Academy of European Law – organized its Annual Conference on European Consumer Law 2020. It provided an insight into the main priorities of the new Consumer Agenda and remarks on key topics such as the impact of Covid-19 on consumer protection, the new Digital Services Act package, and the Collective redress framework in the EU with a specific focus on the new EU Directive on representative actions for the protection of collective interests of consumers. This report starts with an introduction to several presentations given by renowned scholars, followed by an overview of the recent Representative Actions Directive.
Day 1: The New Consumer Law Updates, digital transition, and green transition
The New Consumer Agenda, which presents a vision for the EU consumer policy from 2020 to 2025, builds on the 2012 Consumer Agenda (which expires in 2020) was the focus of the first panel. Massimo Serpieri (Deputy Head of Unit, DG Justice and Consumers, European Commission, Brussels) spoke about the action plan for the next five years to empower European consumers to play an active role in the green and digital transitions. She mentioned how the Agenda also addresses the need to increase consumer protection and resilience during and after the COVID-19 pandemic, which brought significant challenges affecting the daily lives of consumers.
Ursula Pachl (Deputy Director-General, BEUC – The European Consumer Organisation, Brussels) then expanded on the challenges of the COVID-19 outbreak and the need for drawing lessons from the crisis to reshape consumer protection and accelerate the digital and green transition. The core of her presentation was the inevitability of a powerful Competition Law framework for consumer choice, higher quality, and more investments, as well as the need for protecting consumers and ensuring that they have the right to object to decisions made by machines in the arena of automated decision-making.
Teresa Rodríguez de las Heras Ballell (Associate Professor, Carlos III University, Madrid) started the second panel of the discussion by giving a brief background on the new Digital Services Act package, a comprehensive set of rules comprising of the Digital Services Act and Digital Markets Act. They will create a safer and more open digital space, with European values at its core. With this, she addressed the need for updating the E-commerce Directive of the year 2000. The manner in which the E-commerce Directive has been implemented across the EU varies greatly, and national jurisprudence on online liability today remains very fragmented. This fragmentation has created uncertainty in the implementation regime, and it is, therefore, essential to revise the EU liability regime for online intermediaries.
Jan Penfrat (Senior Policy Advisor, EDRi – European Digital Rights, Brussels) proceeded then by highlighting the key issues raised by dominant platforms ahead of the adoption of the new Digital Services Act package. He addressed the main problems with centralized platforms, which dominate the online space, and work on the business model of providing free services in exchange of highly confidential personal data by analyzing Regulation (EU) 2019/1150 on promoting transparency for business users of online intermediation services.
The second half of the first day was dedicated to a discussion on the Green Transition and how to achieve sustainable consumption. Emmanuelle Maire (Head of Unit, DG Environment, European Commission, Brussels) started the discussion with a comprehensive overview of the European Commission’s New Circular Economy Action Plan with a focus on main proposals concerning consumers.
Guaranteeing sustainability at the pre-contractual stage was the focus of the presentation of Petra Weingerl (Assistant Professor, University of Maribor), in which she analyzed the Guidance on implementation of the Unfair Commercial Practices Directive. This was followed by the presentation of Evelyne Terryn (Professor, Catholic University of Leuven), which focused on the topic of promoting sustainable choices at the contractual stage and the “right to repair” under the Sale of Goods Directive.
A discussion was then convened on best practices of the transition to the Circular Economy, in the Member States in Belgium and France by Evelyne Terryn, Slovenia by Petra Weingerl and Sweden by Carl Dalhammar (Associate Professor, International Institute for Industrial Environmental Economics, Lund University) on the need for minimization of waste to achieve a circular economy. The following round table discussion that ensued between Eva Dalenstam (Policy Officer, Circular Economy, DG Environment, European Commission, Brussels), Carl Dalhammar, Margreeth Pape (Programme Manager, Sustainability and Logistics, Thuiswinkel.org) offered an insight into the main challenges posed in the real world while bringing the green and digital transitions together and explained ways to achieve more sustainable e-commerce.
Day 2: Recent Case Law Update of CJEU and Collective Redress
The next day’s first panel began with a presentation from Massimiliano Puglia (Legal Secretary, Court of Justice of the European Union, Luxembourg), who provided a comprehensive overview of cases involving consumer protection at the CJEU in the past year. He spoke about several important cases involving judicial cooperation in civil matters under Regulation (EU) No. 1215/2012 (C-213/18, easyJet; C-343/19, Verein für Konsumenteninformation ) and protection of consumers against unfair contract terms C?511/17, Lintner; C?260/18, Dziubak; C?125/18, Gómez del Moral Guasch; C-779/18, Mikrokasa and Revenue; C-81/19, Banca Transilvania).
Christine Riefa (Reader in Law, Brunel University, London) proceeded then with an interesting discussion on the concept of ‘vulnerable consumer’ and the lack of access to justice to such a consumer who is a weaker party in the justice system.
Stefaan Voet (Associate Professor, Catholic University of Leuven) was then handed the floor to reflect on the final text of the proposed Directive on representative actions for the protection of the collective interests of consumers, which is a part of the 2018 New Deal for Consumers. After providing some brief background, Stefaan Voet focused on four points of the Directive – scope of application, the cross-border element of representative actions, application of private international law, funding, and financing. He analyzed the standing of qualified entities and criteria for recognizing such qualified entities to bring a cross border action under the said draft directive. The Representative Actions Directive (Directive 2020/1828) has now been finalized and published on 25 November 2020.
Highlights of the Representative Actions Directive
The recent Directive on representative actions for protecting the collective interests of consumers repeals the earlier Injunctions Directive 2009/22/EC (hereinafter referred to as the Directive) and creates provisions for qualified representative entities, private or public entities to lodge cross-border claims. As per the said Directive, three types of representative entities shall have the standing to bring representative actions on behalf of consumers. These are private representative entities designated in advance by the Member States and placed in a publicly available list, representative bodies designated on an ad hoc basis for a specific action or particular consumer organization, and independent public bodies.
For domestic actions, Member States have to set out proper criteria consistent with the objectives of the Directive. Accordingly, all entities complying with the requirements of the Directive would have the right to benefit from its regime. The EU legislator offers some flexibility to the Member States regarding the possibility to designate entities on an ad hoc basis for bringing specific representative actions. The proposed Directive allows ‘qualified entities’ to bring actions against the infringement by traders before the competent court or administrative bodies in other Member Nations. This means that ‘qualified entities’ have standing before the competent courts or other administrative bodies in all Member Nations to file a representative action. In other words, Member States are bound to accept the legal standing of foreign ‘qualified entities’ who fulfil the requirements established by their national laws in order to take action, in case an infringement of the collective interests of consumers has a cross-border dimension. Article 4 of the Directive states that cross-border cases can be brought by entities that comply with the following criteria. It must at least have 12 months of activity in protecting consumer’s interests; it must be of a non-profit character; its statutory purpose demonstrates that it has a legitimate interest in protecting consumer interests. Additionally, it must be independent of third parties whose interests oppose the consumer interest, it must not be subject to an insolvency procedure or declared insolvent, and it must make public disclosure of the information demonstrating compliance of the above.
Additionally, qualified entities from different Member States can also join hands to file a claim before a single court having jurisdiction under relevant EU and national law. It is important to mention here that the requirements of the Directive entail that the statutory purpose of qualified entities demonstrates that they have a legitimate interest in protecting consumer interests. They must demonstrate that they have been functioning in the field of protection of consumer interests for about one year. At the same time, they must be able to bear the costs of the representative proceedings on their own and disclose that they are capable of doing so. The Member States, which designate qualified entities, shall verify whether they continue to fulfil these criteria every five years. If they fail to comply with these criteria, the Member States have the power to revoke their designation. Thus, the standard for determining the capacity of the qualified entity is now the ‘economic capability’ and not based on the litigant’s rights or moral agency. The display of economic capability will require the qualified entities to thrive in the field of consumer protection continuously, and it will not be long before collective redress actions become a means of survival of these entities.
Further, in the context of cross-border cases, Member States may also designate entities representing consumers from the different Member States. Article 6 of the said Directive allows mutual recognition of legal standing of qualified entities designated in advance in one Member State as per Article 4(1) to seek representative action in another Member State. However, it is important to note that it is yet to be seen how the Directive will be implemented in the Member States.
Finally, in the last presentation of the second day, Alexia Pato (Postdoc Research Fellow, University of McGill, Montreal) addressed the interplay between collective redress and general data protection regulation(GDPR) with a focus on the representation of data subjects under its Article 80. The said provision allows consumer associations to litigate on behalf of data subjects. She also spoke about the said Representative Actions Directive and that data protection has been added into the scope of the Directive. She pointed out that it will be interesting to see how the Directive will be implemented in the Member States.
To sum up, this two-day event provided an up-to-date insight into the latest policy developments, legislative initiatives, and case law in the field of consumer protection, including related conflict-of-laws issues. The detailed presentations from renowned experts in this field generated a good understanding of several challenges faced by the consumer in the real world and the future consumer agenda to ensure effective consumer protection.
Ulla Liukkunen on Employment and Private International Law
Written by Ulla Liukkunen, Professor of Labour Law and Private International Law at the University of Helsinki
The volume ´Employment and Private International Law´, edited by Ulla Liukkunen, has been published in the Private International Law Series (series editor: Symeon C. Symeonides)
of Edward Elgar Publishing in December 2020.
This edited collection gathers together a set of articles that address labour law and labour protection issues that are central to understanding the complex development of private international law and its tasks as well as broadening challenges of this field. The introduction by the editor, Ulla Liukkunen, Professor of Labour Law and Private International Law at the University of Helsinki, draws attention to characteristics of major developments in the field but also assesses the broader regulatory framework and challenges under way to traditional approaches. These challenges relate to both transnational labour law developments that require reassessment of the role of private international law and developments that derive from the ongoing transformation of substantive employment law itself, unfolding the limitations of protection restricted to a certain pre-determined legal status of the weaker party only.
With the legal landscape of labour protection changing, Liukkunen examines how private international law should be affected. According to her, old conceptions on which protection in private international law is traditionally based are becoming too narrow to be solely prioritized. Liukkunen discusses the importance of viewing the role private international law has assumed in the transnational dimension of collective bargaining and employee participation. Especially in the EU, regulatory approaches have been adopted that use private international law rules in a coordinative way so that labour rights can be upheld despite the pressures of the market.
The particular role of private international law as the ´mediator´ between labour law and company law in EU legislation reflects the expanding materialization of private international law. According to Liukkunen, it also relates to the use of conflicts law in order to enable establishment of transnational institutional structures that reduce obstacles to private regulatory authority. Moreover, the article analyses private self-regulation and related governance structures from the perspective of private international law, stressing a need for response to collisions posed by transnational normativities involved.
Brexit: The Spectre of Reciprocity Evoked Before German Courts
The following post has been written by Ennio Piovesani, PhD Candidate at the Universities of Turin and Cologne.
While negotiations for an agreement on the future partnership between the EU and the UK are pending, a spectre haunts Europe: reciprocity.
I. The Residual Role of the Requirement of Reciprocity
In some EU Member States, provisions of national-autonomous aliens law enshrine the requirement of reciprocity. Those provisions are largely superseded by exceptions established in international law, including international treaties (so-called “diplomatic reciprocity”). EU (primary and secondary) law establishes broad exceptions concerning EU citizens and legal persons based in the EU.
In the context of EU / UK relations, the Withdrawal Agreement relieves UK nationals and legal persons from the requirement of reciprocity in the EU Member States. However, the scope of the exception established by the Withdrawal Agreement is limited in (personal and temporal) scope. An agreement on the future partnership between the EU and the UK could establish “full reciprocity” (Cf. points 29 and 49 of the Political Declaration accompanying the Withdrawal Agreement). Instead, if new arrangements will not be made, at the end of the transition period, in cases not covered by the Withdrawal Agreement, the method of reciprocity might once more play a residual role in the context of the treatment of UK nationals and legal persons in some EU Member States.
II. German Case-Law on Reciprocity with the UK and Civil Procedure
The spectre of reciprocity, in relations with the UK, was evoked in three recent cases brought before the German courts. The three cases concern provisions of German-autonomous aliens law in the field of civil procedure, which enshrine the requirement of reciprocity.
1. § 110 ZPO (Security for Court Costs)
In particular, two of the mentioned cases concern § 110 ZPO. Pursuant to § 110(1) ZPO claimants not (habitually) residing in the EU (or in the EEA) must provide security for court costs (if the defendant requests so). § 110(2) ZPO provides exceptions to that duty. The claimant is relieved from the duty to provide security if an international treaty so provides (See § 110(2) no 1 ZPO) or if a treaty ensures the enforcement of the decision on court costs (see § 110(2) no 2 ZPO; see also the other exceptions listed in § 110(2), nos 3–5 ZPO).
In 2018 – before the UK’s withdrawal from the EU –, in a case brought before the Düsseldorf Regional Court, a German defendant sought a decision ordering the UK claimant to provide security under § 110 ZPO (Düsseldorf Regional Court, interim judgment of 27 Sept 2018 – 4c O 28/12). The Regional Court dismissed the defendant’s application, since (at that time) the UK was still an EU Member State. The German court thus shun an investigation as to “whether other international treaties might relieve the claimant from the obligation of providing security for costs after the [UK’s] withdrawal”.
Subsequently, in 2019 – after the UK’s withdrawal from the EU, during the transition period –, a German defendant sought from the Dortmund Regional Court a decision ordering the claimant seated in London to provide security under § 110 ZPO (Dortmund Regional Court, interim judgment of 15 July 2020 – 10 O 27/20). The Regional Court dismissed the defendant’s application, noting that – in the light of the legal fiction created by the Withdrawal Agreement – the UK must be considered as an EU Member State until the end of 2020. The German court – like the Düsseldorf Regional Court – shun an investigation as to whether treaties other than the Withdrawal Agreement relieve UK claimants – not habitually residing in the EU (or in the EEA) – from the duty of providing security under § 110 ZPO.
It appears that, apart from the Withdrawal Agreement, a treaty establishing diplomatic reciprocity for the purposes of § 110(2) no 1 ZPO does not exist yet (cf. ECJ, judgment 20 Mar 1997 – C-323/95).
Addendum: As mentioned above, § 110 ZPO does not apply to claimants habitually residing in the EU or EEA. It is important to underline that this holds true even in the case of UK nationals (habitually) residing in Germany (or in any other EU Member State or in an EEA Member State). It is also important to underline that, if the German-British Convention of 20 Mar 1928 on the conduct of legal proceedings will “revive” in relations between Germany and the UK after the transition period, Art. 14 of that Convention will establish diplomatic reciprocity for the purposes of § 110 ZPO with respect to UK nationals having their “Wohnsitz” (domicile) in Germany. On the latter point see the ECJ’s judgment referred to above.
2. § 917(2) ZPO (Writ for Pre-Judgment Seizure)
The third case brought before the German courts concerns § 917(2) ZPO. Pursuant to the first sentence of § 917(2) ZPO, a writ for pre-judgment seizure can be issued if the prospective judgment will have to be enforced abroad and if “reciprocity is not granted” (i.e. if an international treaty does not grant that the judgment will be eligible for enforcement in the given foreign country).
In 2019 – before the UK’s withdrawal from the EU –, in a case brought before the Frankfurt Higher Regional Court, a German claimant applied for a writ under § 917 ZPO against a UK defendant (Frankfurt Higher Regional Court, judgment of 3 May 2019 – 2 U 1/19). The Higher Regional Court noted that reciprocity under § 917(2) first period ZPO could have been lacking if, after the UK’s withdrawal from the EU, the Brussels Ia Regulation would have not been replaced by new arrangements granting the enforcement of (German) judgments in the UK. This notwithstanding, the German court decided not to issue the writ under § 917(2) first period ZPO, since failure to conclude new agreements replacing the Brussels Ia Regulation was (at that time) unlikely. In fact, the court pointed to the then ongoing negotiations between the EU and UK, namely to Art. 67(II) of the draft Withdrawal Agreement (today’s Art. 67(1)(a) Withdrawal Agreement), providing for the continued application of the Brussels Ia Regulation in the UK.
It appears that, apart from the Withdrawal Agreement, a treaty establishing diplomatic reciprocity with the UK, for the purposes of § 917(2) ZPO, does not exist yet (unless the 1960 Convention between the UK and Germany for reciprocal recognition and enforcement of judgments – or even the 1968 Brussels Convention – will “revive”). An (albeit limited) exception concerns cases covered by exclusive choice-of-court agreements in favour of German courts falling under the 2005 Hague Convention (in fact, on 28 Sept 2020, the UK has deposited its instrument of accession to the 2005 Hague Convention, which should grant continuity in the application of the same Convention in the UK after the transition period).
III. Conclusion
In conclusion, at the end of the transition period, in cases not covered by the Withdrawal Agreement, unless new arrangements are made, the requirement of reciprocity might play a residual role in the context of the treatment of UK nationals and legal persons in some EU Member States, such as Germany.
News
Conference on Cross-Border Dispute Resolution in Dubrovnik, Croatia, on 8-10 May 2024
From 8 to 10 May, the University of Zagreb, Croatia, is hosting a conference on Cross-Border Dispute Resolution, organized by Dora Zgrabljic Rotar in cooperation with the Universities of Verona, Italy, and Pittsburgh, USA. The conference will take place in Dubrovnik and is primarily aimed at practising lawyers.
More information can be found on the conference flyer.
Promulgation of the Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of International Treaties and International Practices in the Trial of Foreign-related Civil and Commercial Cases
By Professor Du Tao* and Yang Zhenni**
On December 28, 2023, the Supreme People’s Court (SPC) held a press conference on Judicial Interpretations and Typical Cases on the Application of International Treaties and International Practices in Foreign-related Civil and Commercial Cases, deliberating the Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of International Treaties and International Practices in the Trial of Foreign-related Civil and Commercial Cases (Interpretation) and some related typical cases. The Interpretations was adopted by the Trial Committee of the Supreme People’s Court at its 1908th meeting on December 5, 2023, which will come into force on January 1, 2024. We translated the press announcement as follows:
Out now: The Cambridge Handbook of Comparative Law (by Siems and Jen Yap)
There is no doubt that private international law works in close cooperation with comparative law. Horatia Muir Watt, for example, characterises the relationship between the two disciplines as “complementary” (H M Watt, “Private International Law”, in J M. Smits (ed.), Elgar Encyclopedia of Comparative Law (2nd ed., Edward Elgar Publishing, 2012) p. 701). Similarly, Mathias Reimann describes it as “intimate” (M Reimann, “Comparative Law and Private International Law”, in M Reimann and R Zimmermann (eds.), The Oxford Handbook of Comparative Law (2nd ed., OUP, 2019) p. 1340). Meanwhile, Ralf Michaels, another distinguished scholar of comparative and private international law, considers that “in private international law scholarship, comparison has always been prominent” (Ralf Michaels, “Comparative Law and Private International Law”, in J Basedow et al. (eds.), Encyclopedia of Private International law –Volume I (Edward Elgar Publishing, 2017) p. 416).
Understanding foreign legal systems and the diversity of the solutions dealing with common problems and issues has always been crucial for private international law scholars and researchers. This enables them to refine the techniques and theories of private international law, and ultimately serves one of the most important goals of private international law: the coordination of different legal systems.