By Stephen G.A. Pitel, Faculty of Law, Western University

Eritrean mine workers who fled from that country to British Columbia sued the mine’s owner, Nevsun Resources Ltd. They sought damages for various torts including battery, false imprisonment and negligence. They also sought damages for breaches of customary international law. Their core allegation was that as conscripted labourers in Eritrea’s National Service Program, they were forced to work in the mine in intolerable conditions and Nevsun was actively involved in this arrangement.

Nevsun moved to strike out all of the claims on the basis of the act of state doctrine. It also moved to strike out the proceedings based on violations of customary international law because they were bound to fail as a matter of law.

In its decision in Nevsun Resources Ltd v Araya, 2020 SCC 5, the Supreme Court of Canada has held (by a 7-2 decision) that the act of state doctrine is not part of Canadian law (para. 59) and so does not preclude any of the claims. It has also held (by a 5-4 decision) that the claims based on customary international law are not bound to fail (para. 132) and so can proceed.

Act of State Doctrine

Justice Abella, writing for five of the court’s nine judges, noted that the act of state doctrine had been heavily criticized in England and Australia and had played no role in Canadian law (para 28). Instead, the principles that underlie the doctrine were subsumed within the jurisprudence on “conflict of laws and judicial restraint” (para 44).

In dissent, Justice Cote, joined by Justice Moldaver, held that the act of state doctrine is not subsumed by choice of law and judicial restraint jurisprudence (para. 275). It is part of Canadian law. She applied the doctrine of justiciability to the claims, finding them not justiciable because they require the determination that the state of Eritrea has committed an internationally wrongful act (para. 273).

This division raises some concerns about nomenclature. How different is “judicial restraint” from “non-justiciability”? Is justiciability an aspect of an act of state doctrine or is it a more general doctrine (see para. 276)? Put differently, it appears that the same considerations could be deployed by the court either under an act of state doctrine or without one.

The real division on this point is that Justice Cote concluded that the court “should not entertain a claim, even one between private parties, if a central issue is whether a foreign state has violated its obligations under international law” (para. 286). She noted that the cases Justice Abella relied on in which Canadian courts have examined and criticized the acts of foreign states are ones in which that analysis was required to ensure that Canada comply with its own obligations as a state (para. 304). In contrast, in this case no conduct by Canada is being called into question.

In Justice Abella’s view, a Canadian court can indeed end up determining, as part of a private civil dispute, that Eritrea has engaged in human rights violations. She did not, however, respond to Justice Cote’s point that her authorities were primarily if not all drawn from the extradition and deportation contexts, both involving conduct by Canada as a state. She did not squarely explain why the issue of Eritrea’s conduct was justiciable or not covered by judicial restraint in this particular case. Having held that the act of state doctrine was not part of Canadian law appears to have been sufficient to resolve the issue (para. 59).

Claims Based on Violations of Customary International Law

The more significant split relates to the claims based on violations of customary international law. The majority concluded that under the “doctrine of adoption”, peremptory norms of customary international law are automatically adopted into Canadian domestic law (para. 86). So Canadian law precludes forced labour, slavery and crimes against humanity (paras. 100-102). Beyond that conclusion, the majority fell back on the hurdle for striking out claims, namely that they have to be bound (“plain and obvious”) to fail. If they have a prospect of success, they should not be struck out. The majority found it an open question whether these peremptory norms bind corporations (para. 113) and can lead to a common law remedy of damages in a civil proceeding (para. 122). As a result the claims were allowed to proceed.

Four of the judges dissented on this point, in reasons written by Brown and Rowe JJ and supported by Cote and Moldaver JJ. These judges were critical of the majority’s failure to actually decide the legal questions raised by the case, instead leaving them to a subsequent trial (paras. 145-147). In their view, the majority’s approach “will encourage parties to draft pleadings in a vague and underspecified manner” which is “likely not to facilitate access to justice, but to frustrate it” (para. 261). The dissent was prepared to decide the legal questions and held that the claims based on violations of customary international law could not succeed (para. 148).

In the dissent’s view, the adoption into Canadian law of rules prohibiting slavery, forced labour and crimes against humanity did not equate to mandating that victims have a civil claim for damages in response to such conduct (para. 172). The prohibitions, in themselves, simply did not include such a remedy (para. 153). The right to a remedy, the dissent pointed out, “does not necessarily mean a right to a particular form, or kind of remedy” (para. 214).

Further, as to whether these rules can be directly enforced against corporations, the dissent was critical of the complete lack of support for the majority’s position: “[i]t cites no cases where a corporation has been held civilly liable for breaches of customary international law anywhere in the world” (para. 188). As Justice Cote added, the “widespread, representative and consistent state practice and opinio juris required to establish a customary rule do not presently exist to support the proposition that international human rights norms have horizontal application between individuals and corporations” (para. 269).

On this issue, one might wonder how much of a victory the plaintiffs have achieved. While the claims can now go forward, only a very brave trial judge would hold that a corporation can be sued for a violation of customary international law given the comments of the dissenting judges as to the lack of support for that position. As Justices Brown and Rowe put it, the sole authority relied on by the majority “is a single law review essay” (para. 188). Slender foundations indeed.

Report written by Tine Van Hof, researcher at the University of Antwerp

On the 13th and 14th of
February 2020, the Academy of European Law (ERA) organized a conference on
‘Recent ECtHR Case Law in Family Matters’. This conference was held in
Strasbourg and brought together forty participants coming from twenty-one
different countries. This report will set
out some of the issues addressed at the conference.

The presentation, made by Ksenija
Turkovi?, Judge at the European Court of Human Rights, focused
on children on the move and more specifically on minors in the context of
migration. On this topic the European Court of Human Rights (ECtHR) has developed
a child-specific human rights approach. This approach implies taking into
account three particular concepts: vulnerability, best interests and autonomy.
Judge Turkovi? pointed to the interesting discussion on whether vulnerability could
only apply to young migrant children. On this discussion, there is now agreement
that the vulnerability applies to all children under the age of 18 and regardless
whether they are accompanied by adults. The ECtHR made very clear in its case law
that migrant children are especially vulnerable and that this vulnerability is a
decisive factor that takes precedence over the children’s migrant status. This
vulnerability also plays a role in the cases on the detention of children. The
more vulnerable a person is, the lower the threshold for a situation of
detention to fall within the scope of Article 3 of the European Convention on Human
Rights (ECHR), encompassing the prohibition of torture.

Family unification and the free movement of family
status was the second topic of the day. Michael Hellner,
professor at Stockholm University, discussed several cases of the ECtHR
(Ejimson v Germany) and the Court of Justice of the EU (CJEU) (K.A. v Belgium,
Coman and S.M.). He concluded that family life does not automatically create a
right of residence but it can create such a right in certain circumstances. In
the Coman case for example, the CJEU decided that Romania had to recognize the
marriage between the two men for the purpose of enabling such persons to
exercise the rights they enjoy under EU law (i.e. free movement). Professor
Hellner noted that it seems to be quite easy to circumvent national law in the
future if one looks at the Coman case. He considered it positive if the
consequence was that same-sex marriages and surrogacy arrangements created abroad
were recognized. However, he made the interesting observation that it might be
a very different story if one thinks about child marriages and the recognition
thereof.

Maria-Andriani Kostopoulou,
consultant in family law for the Council of Europe, thereafter shared her
insights on parental rights, pre-adoption foster care and adoption. She
discussed i.a. the evolution in the case law of the ECtHR on the representation
of the child before the Court. In the Strand-Lobben case, the Court stated that
the issue of representation does not require a restrictive or technical
approach and thus made clear that a certain level of flexibility is necessary. In
the Paradisio and Campanelli case, the ECtHR provided three criteria that
should be taken into account for assessing the representation of the child: the
link between the child and the representative, the subject-matter of the case
and any potential conflict of interests between the interests of the child and
those of the representative. The latest case, A. and B. against Croatia,
introduced a security safeguard. In this case, the ECtHR asked the Croatian Bar
Association to appoint a legal representative for the child for the procedure
before the ECtHR since the Court was not sure that there were no conflict of
interests between the child and the mother, who proposed to be the
representative.

To end the first conference day, Dmytro
Tretyakov, lawyer at the Registry of the ECtHR, enlightened us about
the misconceptions and best practices of submitting a case to the Court. His
most important tips for a submission to the Court are the following:

• Use the current application form and not an old one;
• Submit well in time and certainly within the six-month
  period;
• Summarize the facts of the case on the three pages
  provided. This summary has to be clear, readable (for those that do it in
  handwriting) and comprehensible;
• To state claims, refer to the relevant Article from
  the ECHR (do not cite it) and explain what the specific problem is with regard
  to that Article;
• Support each claim with documents; and
• Sign the form in the correct boxes and carefully look
  where the signature of the applicant and where the signature of the
  representative is required.

The second day of the conference started with the
presentation of Nadia Rusinova, attorney-at-law and lecturer at
the Hague University of Applied Science, on international child abduction. She
discussed i.a. the issue of domestic violence in child abduction cases. Several
questions can be raised in this regard, for example: what constitutes domestic
violence? When should a court accept the domestic violence to be established? What
is adequate protection in light of the Hague Convention on International Child
Abduction (1980) and who decides on this? In the case O.C.I. and others v
Romania, one of the questions was whether there is such a thing as light
violence that does not amount to a grave risk in the sense of Article 13(1)(b)
of the Hague Convention. The ECtHR approached this issue very critically and
stated that no form of corporal punishment is acceptable. Regarding the
adequate measures, the Court stated that domestic authorities have a discretion
to decide what is adequate but the measures should be in place before ordering the
return of the child. Another point raised by Ms. Rusinova is the time factor
that is required. If one looks at Article 11(2) of the Hague Convention and at
Article 11(3) of the Brussels IIbis Regulation together, six weeks is the required
time period for the return proceedings. The Brussels IIbis Recast clarified
that the procedure should take no more than six weeks per instance. However, according
to Ms. Rusinova it is hardly possible to do the procedures in six weeks; it
will only work when the proceeding is not turned into an adversarial proceeding
in which all kinds of claims of both parents are dealt with.  

Samuel Fulli-Lemaire, professor
at the University of Strasbourg, addressed the interesting evolution of
reproductive rights and surrogacy. In the case of C. and E. v France, the
French Court of Cassation asked the ECtHR for an advisory opinion on the
question whether the current state of the case law in France was compatible
with the obligations under Article 8 ECHR (the right to respect for private and
family life). The status of the French case law was that the genetic parent was
fully accepted but the other intended parent was required to adopt the child if
he or she wished to establish parentage links. The ECtHR replied that the
obligation under Article 8 entailed that there must be a possibility of
recognition of the parent-child relationship but that it is up to the States to
decide how to do this. Adoption is a sufficient method of recognizing such relationship,
provided that it is quick and effective enough. The Court also refers to the
possibility of transcription of the birth certificate as an alternative to
adoption. However, professor Fulli-Lemaire pointed out that there is a
misconception on what transcription means under French law. The mere
transcription of the birth certificate does not establish legal parentage in
France. The fact that the ECtHR says that an intended parent can adopt or
transcribe the birth certificate is therefore tricky because under French law
the effects of the two methods are not at all the same.

The very last presentation of the conference was given
by Gabriela Lünsmann, attorney-at-law and member of the Executive
Board of the Lesbian and Gay Federation in Germany. She spoke about LGBTQI
rights as human rights and hereby focused i.a. on transsexuals’ gender identity
and the case of X. v North-Macedonia. The question raised in that case is whether
the state must provide for a procedure to recognize a different gender. The
applicant had tried to change their gender but North-Macedonia did not offer
any possibility to undergo an operation or to have medical treatment in that regard.
The applicant then went abroad for treatment. Back in North-Macedonia, he had
his name changed but it was not possible to change his officially registered gender.
The applicant claimed that this amounted to a violation of Article 8 ECHR and
specially referred to the obligation of the state to respect a person’s
physical and psychological integrity. The Court found that there was indeed a
violation. What is as yet unclear, and is thus an interesting point for
reflection, is whether states are under an obligation to provide for a
procedure for the recognition of a change of gender without the person having
had an operation.

The author would like to thank ERA for the excellent
organization of the conference and for the interesting range of topics
discussed.

This note addresses the question whether
there is a common law basis for the recognition of foreign declarations of
parentage. It appears that this issue has not received much attention in common
law jurisdictions, but it was the subject of a relatively recent Privy Council decision
(C v C [2019] UKPC 40).

The issue arises where a foreign
court or judicial authority has previously determined that a person is, or is
not, a child’s parent, and the question of parentage then resurfaces in the
forum (for example, in the context of parentage proceedings or maintenance proceedings).
If there is no basis for recognition of the foreign declaration, the forum
court will have to consider the issue de novo (usually by applying the law of
the forum: see, eg, Status of Children Act 1969 (NZ)). This would increase the
risk of “limping” parent-child relationships (that is, relationships that are
recognised in some countries but not in others) – a risk that is especially
problematic in the context of children born by way of surrogacy or assisted
human reproduction technology.

The following example illustrates
the problem. A baby is born in a surrogacy-friendly country to a surrogate
mother domiciled and resident in that country, as the result of a surrogacy arrangement
entered into with intending parents who are habitually resident in New Zealand.
The courts of the foreign country declare that the intending parents are the
legal parents of the child. Under New Zealand law, however, the surrogacy
arrangement would have no legal effect, and the surrogate mother and her
partner would be treated as the child’s legal parents upon the child’s birth.
Unless the foreign judgment is capable of recognition in New Zealand, the only
way for the intending parents to become the child’s legal parents in New
Zealand is to apply for adoption (see, eg, Re Cobain [2015] NZFC 4072, Re Clifford [2016] NZFC 1666, Re Henwood [2015] NZFC 1541, Re Reynard [2014] NZFC 7652, Re
Kennedy [2014] NZFLR 367, Re W [2019] NZFC 2482, Re C
[2019] NZFC 1629).

So what is the relevance of a
foreign declaration on parentage in common law courts? In C v C [2019]
UKPC 40, [2019] WLR(D) 622, the Privy Council decided that there was a basis in
the common law for recognising such declarations, pursuant to the so-called Travers
v Holley principle. This principle, which has traditionally been applied in
the context of divorce and adoption, calls for recognition of foreign judgments
on the basis of “jurisdictional reciprocity” (at [44]). The Privy Council
applied the principle to recognise a declaration of parentage made in Latvia,
in relation to a child domiciled and habitually resident in Latvia, for the
purposes of maintenance proceedings in the forum court of Jersey. Lord Wilson
emphasised that, although foreign judgments may, in some cases, be refused on
grounds of public policy, recognition will not be refused lightly: “a court’s
recognition of a foreign order under private international law does not depend
on any arrogant attempt on that court’s part to mark the foreign court’s
homework” (at [58]).

As a matter of policy, my first
impression is that the Privy Council’s decision is to be welcomed. Common law
jurisdictions have traditionally taken a conservative, relatively “closed”
approach to the recognition of foreign laws and judgments on parentage (see Hague
Conference on Private International Law A Study of Legal Parentage and the
Issues Arising from International Surrogacy Arrangements (Prelim Doc No 3C,
2014)). Such an approach has become increasingly indefensible in a world that
is witnessing unprecedented levels of cross-border mobility and migration. The conflict
of laws should, as a matter of priority, avoid limping parent-child
relationships: for example, a child who was declared by the courts of their
place of birth to be the child of the intending parents, but who is
nevertheless treated as the surrogate mother’s child under New Zealand law. The
ability to recognise foreign judgments on parentage may not amount to much progress,
given that it can apply only where the foreign court has, in fact, made a
declaration of parentage: it would have no application where the relevant
parent-child relationship simply arises by operation of law or through an
administrative act (such as entry of the intending parents in the birth
register). There is no doubt that an international solution must be found to
the problem as a whole. But it is surely better than nothing.

Another question is what to make of the Privy Council’s reliance on the Travers v Holley principle. Based on the decision in Travers v Holley [1953] P 246 (CA), the principle enables recognition of foreign judgments by virtue of reciprocity: the forum court will recognise a foreign judgment if the forum court itself would have had jurisdiction to grant the judgment had the facts been reversed (ie had the forum court been faced with the equivalent situation as the foreign court). In the context of divorce, the principle has since been subsumed within a wider principle of “real and substantial connection” (Indyka v Indyka [1969] 1 AC 33 (HL)). In the context of adoption, the principle has been applied to recognise “the status of adoption duly constituted … in another country in similar circumstances as we claim for ourselves” (Re Valentine’s Settlement [1965] Ch 831 (CA) at 842).

Perhaps it is not a big step from
adoption to parentage more generally. The Privy Council recognised that the latter
primarily represents “a conclusion of biological fact”, while adoption “stamps
a person with a changed legal effect” (at [39]). But the Privy Council did not seem
to consider that this distinction should warrant a different approach in
principle. In C v C, the issue of parentage involved a relatively straightforward
question of paternity. Had the case involved a question of surrogacy or human
assisted reproduction, the answer might well have been different. There is an
argument that a parent-child relationship created under foreign law can only be
recognised in the forum if the foreign law is substantially similar to forum
law. Thus, in the context of adoption, it has been asked whether the concept of
adoption in the foreign country “substantially conform[s] to the English
concept” (Re T & M (Adoption) [2010] EWHC 964, [2011] 1 FLR
1487 at [13]). This requirement might not be made out where, for example, the law
of the forum does not recognise parentage by way of surrogacy (as is the case
in New Zealand).

The Privy Council cautioned that the
Board did not receive full argument on the issue and that the reader “must bear
the lack of it in mind” (at [34]). It seems especially important, then, for conflict
of laws scholars to give the issue further consideration. This note may serve
as a careful first step – I would be interested to hear other views. Perhaps the
most encouraging aspect of the Board’s reasoning, in my mind, is its openness to
recognition. The Board’s starting point was that the declaration could be
recognised. Arguably, this was because counsel seemed to have largely conceded
the point. But to the extent that it cuts through an assumption that questions of
parentage are generally left to the law of the forum, it nevertheless strikes
me as significant – even more so since the UK Supreme Court’s previous refusal
to extend the Travers v Holley principle beyond the sphere of family law
(Rubin v Eurofinance SA [2012] UKSC 46, [2012] 3 WLR 1019 at [110],
[127]).

Can a foreign marriage be recognised in the UK if the State where it was celebrated is not recognised as a State? This was the question which the High Court of Justice (Family Division) had to answer in MM v NA: [2020] EWHC 93 (Fam).

The Court distilled two questions: was the marriage validly celebrated and if so, can it be recognised in the UK? If the answers to both questions were affirmative, the court could give a declaratory order; if one of them were negative, the parties could celebrate a new marriage in the UK.

In assessing the first question, the court considered issues of formal and essential validity. It took account of the various systems of law in Somaliland: formal law (including the Somali civil code, which is still in force in Somaliland on the basis of its continuation under the Somaliland constitution), customary law and Islamic law. In matters of marriage, divorce and inheritance, the latter applies. On the basis of the facts, the Court came to the conclusion that the parties were validly married according to the law of Somaliland.

Although this would normaly be the end of the matter, the Court had to consider what to do with a valid marriage emanating from a State not recognised by the UK (the second question). The Court referred to the one-voice principle, implying that the judiciary cannot recognise acts by a State while the executive branch of the UK refuses to recognise the State. It then considered exceptions and referred to cases concerning the post-civil war US, post-World War II Eastern Germany, the Turkish Republic of Northern Cyprus, Ciskei (one of the ‘States’ created by Apartheid-era South Africa), and Southern Rhodesia.

It also referred to the ICJ Advisory Opinion of 21 June 1971 on the continued presence of South Africa in Namiba, particularly its §125, which states:

“while official acts performed by the Government of South Africa on behalf of or concerning Namibia after the termination of the Mandate are illegal and invalid, this invalidity cannot be extended to those acts, such as, for instance, the registration of births, deaths and marriages, the effects of which can be ignored only to the detriment of the inhabitants of the Territory.”

The Court found that an exception to the one-voice doctrine is acceptable in matters of private rights. The Court also explained that it had conferred with the Foreign and Commonwealth Office of the UK Government, who would not object to the recognition of a Somaliland marriage even though that State is not recognised.

It thus gave the declaration of recognition of the marriage.

(Thanks to Prakash Shah for the tip.)

by José Antonio Briceño Laborí, Professor of Private International Law, Universidad Central de Venezuela y Universidad Católica Andrés Bello

In 2019 the Venezuelan Private International Law (hereinafter “PIL”) academic community made clear that, despite all the difficulties, it remains active and has the energy to expand its activities and undertake new challenges.

As an example of this
we have, firstly, the different events in which our professors have
participated and the diversity of topics developed by them, among which the
following stand out:

• XI
  Latin American Arbitration Conference, Asunción, Paraguay, May 2019 (Luis
  Ernesto Rodríguez – How is tecnology impacting on arbitration?)
• Conferences for the 130^th
  Anniversary of the Treaties of Montevideo of 1889, Montevideo, Uruguay, June
  2019 (Eugenio Hernández-Bretón and Claudia Madrid Martínez – The recent
  experience of some South American countries not part of Montevideo Treaties in comparative
  perspective to them. The case of Venezuela).
• OAS XLVI Course on
  International Law. Rio de Janeiro, Brazil, August 2019 (Javier Ochoa Muñoz – Effectiveness
  of foreign judgements and transnational access to justice. Reflections from global
  governance).
• The Role of Academia in Latin
  American Private Intertnational Law, Hamburg, Germany, September 2019 (Javier
  Ochoa Muñoz – The Legacy of Tatiana Maekelt in Venezuela and in the Region).
• XIII ASADIP Annual Conference
  2019: Transnational Effectiveness of Law: Recognition and enforcement of
  foreign judgments, arbitral awards and other acts (Claudia Madrid Martínez –
  Transnational Efficacy of Foreign Judgments – Flexibilization of Requirements; Eugenio
  Hernández-Bretón – Transnational Effectiveness of Provisional Measures; and
  Luis Ernesto Rodríguez – New Singapore Convention and the execution of
  international agreements resulting from cross-border mediation).

However, this year’s three
most important milestones for our academic community occurred on Venezuelan
soil. Below we review each one in detail:

1. Celebration of the 20^th
   Anniversary of the Venezuelan PIL Act

The
Venezuelan
PIL Act, the first autonomous legislative instrument on this subject in the
continent, entered into force on February 6, 1999 after a six months vacatio
legis (since it was enacted in the Official Gazette of the Republic of
Venezuela on August 6, 1998).

This instrument has a
long history, as its origins date back to the Draft Law on PIL Norms written by
professors Gonzalo Parra-Aranguren, Joaquín Sánchez-Covisa and Roberto
Goldschmidt in 1963 and revised in 1965. The Draft Law was rescued in 1995 on
the occasion of the First National Meeting of PIL Professors. Its content was
updated and finally a new version of the Draft Law was sent by the professors
to the Ministry of Justice, which in turn sent it to the Congress, leading to
its enactment (for an extensive overview of the history of the Venezuelan PIL
Act and its content, see: Hernández-Bretón, Eugenio, Neues venezolanisches
Gesetz über das Internationale Privatrecht, IPRax 1999, 194 (Heft 03); Parra-Aranguren,
Gonzalo, The Venezuelan Act on Private International Law of 1998, Yearbook
of Private International Law, Vol. 1 1999, pp. 103-117; and B. de Maekelt,
Tatiana, Das neue venezolanische Gesetz über Internationales Privatrecht, RabelsZ,
Bd. 64, H. 2 (Mai 2000), pp. 299-344).

To celebrate the 20^th
anniversary of the Act, the Private International and Comparative Law
Professorship of the Central University of Venezuela and the “Tatiana Maekelt”
Institute of Law with the participation of 7 professors and 9 students of the
Central University of Venezuela Private International and Comparative Law
Master Program.

All the expositions
revolved around the Venezuelan PIL Act, covering the topics of the system of
sources, vested rights, ordre public, in rem rights, consumption contracts,
punitive damages, jurisdiction matters, international labour relations,
recognition and enforcement of foreign judgements, transnational provisional
measures and the relations between the Venezuelan PIL Act and international
arbitration matters. The conference was both opened and closed by the professor
Eugenio Hernández-Bretón with two contributions: “The Private International Law
Act and the Venezuelan university” and “The ‘secret history’ of the Private
International Law Act”.

• Private International
  and Comparative Law Master Program’s Yearbook

On
the occasion of the XVIII National Meeting of Private International Law
Professors, the Private International and Comparative Law Master’s Degree Program
of the Central University of Venezuela launched its website and the first issue of its yearbook. This
specialized publication was long overdue, particularly in the Master’s Program
context which is focused on educating and training researchers and professors
in the areas of Private International Law and Comparative Law with a strong theoretical
foundation but with a practical sense of their fields. The Yearbook will allow
professors, graduates, current students and visiting professors to share their
views on the classic and current topics of Private International Law and
Comparative Law.

This
first issue included the first thesis submitted for a Master’s Degree on the
institution of renvoi, four papers spanning International Procedural
Law, electronic means of payment, cross-border know-how contracts and
International Family Law, sixteen of the papers presented during the
Commemoration of the Twentieth Anniversary of the Venezuelan Private
International Law Act’s entry into force, and two collaborations by Guillermo
Palao Moreno and Carlos Esplugues Mota, professors of Private International Law
at the University of Valencia (Spain), that shows the relation of the Program
with visiting professors that have truly nurtured the students’ vision of their
area of knowledge.

The
Call of Papers for the 2020 Edition of the Yearbook is now open. The deadline
for the reception of contributions will be April 1^st, 2020 and the
expected date of publication is May 15^th, 2020. All the information
is available here.
The author guidelines are available here. Scholars
from all over the world are invited to contribute to the yearbook.

• Libro Homenaje al Profesor Eugenio Hernández-Bretón

On
December 3rd, 2019 was launched a book to pay homage to Professor Eugenio
Hernández-Bretón. Its magnitude (4 volumes, 110 articles and 3298) is a mirror
of the person honored as we are talking about a highly productive and prolific
lawyer, professor and researcher and, at the same time, one of the humblest
human beings that can be known. He is truly one of the main reasons why the
Venezuelan Private International Law professorship is held up to such a high
standard.

The
legacy of Professor Hernández-Bretón is recognized all over the work. Professor
of Private International Law at the Central University of Venezuela, Catholic
University Andrés Bello and Monteávila University (he is also the Dean of the
Legal and Political Sciences of the latter), Member of the Venezuelan Political
and Social Sciences Academy and its President through the celebration of the Academy’a
centenary, the fifth Venezuelan to teach a course at The Hague Academy of
International Law and a partner in a major law firm in Venezuela (where he has
worked since his law school days) are just some of the highlights of his
career.

The
contributions collected for this book span the areas of Private International
Law, Public International Law, Comparative Law, Arbitration, Foreign
Investment, Constitutional Law, Administrative Law, Tax Law, Civil Law,
Commercial Law, Labor Law, Procedural Law, Penal Law, General Theory of Law,
Law & Economics and Law & Politics. The book closes with six studies on
the honored.

The
contributions of Private International Law take the entire first volume. It
includes the following articles:

• Adriana
  Dreyzin de Klor – El Derecho internacional privado argentino aplicado a partir
  del nuevo Código Civil y Comercial (The Argentine Private International Law
  applied from the new Civil and Commercial Code).
• Alfredo
  Enrique Hernández Osorio – Objeto, contenido y características del Derecho
  internacional privado (Purpose, content and characteristics of Private
  International Law).
• Andrés
  Carrasquero Stolk – Trabajadores con elevado poder de negociación y Derecho
  applicable a sus contratos: no se justifica restricción a la autonomía de las
  partes (Workers with high bargaining power and applicable law to their
  contracts: no restriction to party autonomy is justified).
• Carlos
  E. Weffe H. – La norma de conflicto. Notas sobre el método en el Derecho
  internacional privado y en el Derecho internacional tributario (The conflict
  norm. Notes on the method in Private International Law
  and in International Tax Law).
• Cecilia
  Fresnedo de Aguirre – Acceso al derecho extranjero en materia civil y
  comercial: cooperación judicial y no judicial (Access to foreign law in
  civil and commercial matters: judicial and non-judicial cooperation).
• Claudia
  Madrid Martínez – El rol de las normas imperativas en la contratación
  internacional contemporánea (The role of peremptory norms in contemporary
  international contracting).
• Didier
  Opertti Badán – Reflexiones sobre gobernabilidad y Derecho internacional
  privado (Reflections on governance and Private International Law).
• Fred
  Aarons P. – Regulación del internet y el derecho a la protección de datos
  personales en el ámbito internacional (Internet regulation and the right to
  personal data protection at international level).
• Gerardo
  Javier Ulloa Bellorin – Interpretación del contrato: estudio comparativo entre
  los principios para los contratos comerciales internacionales del UNIDROIT y el
  derecho venezolano (Contract interpretation: comparative study between the
  UNIDROIT Principles on International Commercial Contracts and Venezuelan law).
• Gilberto
  Boutin I. – El recurso de casación en las diversas fuentes del Derecho
  internacional privado panameño (Cassational complaint in the various sources of
  Panamanian Private International Law).
• Guillermo
  Palao Moreno – La competencia judicial internacional en la nueva regulación
  europea en materia de régimen económico matrimonial y de efectos patrimoniales de
  las uniones registradas (International jurisdiction in the new European
  regulation on the economic matrimonial regime and the property effects of
  registered partnerships).
• Héctor
  Armando Jaime Martínez – Derecho internacional del trabajo (International Labor
  Law).
• Javier
  L. Ochoa Muñoz – El diálogo de las fuentes ¿un aporte del Derecho internacional
  privado a la teoría general del Derecho? (The dialogue
  of sources: a contribution from private international law to the general theory
  of law?
• Jorge
  Alberto Silva – Contenido de un curso de Derecho internacional regulatorio del
  proceso (Content of a course on international law regulating the process).
• José
  Antonio Briceño Laborí – La jurisdicción indirecta en la ley de derecho
  internacional privado.
• José
  Antonio Moreno Rodríguez – Los Principios Unidroit en el derecho paraguayo (The
  UNIDROT Principles in Paraguayan law).
• José
  Luis Marín Fuentes – ¿Puede existir una amenaza del Derecho uniforme frente al
  Derecho interno?: ¿podríamos hablar de una guerra anunciada? (Can there be a threat to national law from uniform law? Could we talk
  about an announced war?).
• Jürgen
  Samtleben – Cláusulas de jurisdicción y sumisión al foro en América Latina (Jurisdiction
  and submission clauses in Latin America).
• Lissette
  Romay Inciarte – Derecho procesal internacional. Proceso con elementos de extranjería
  (International Procedural Law. Trial with foreign elements).
• María
  Alejandra Ruíz – El reenvío en el ordenamiento jurídico venezolano (Renvoi
  in the Venezuelan legal system).
• María
  Mercedes Albornoz – La Conferencia de La Haya de Derecho Internacional Privado
  y el Derecho aplicable a los negocios internacionales (The Hague Conference on
  Private International Law and the applicable Law to International Business).
• María
  Victoria Márquez Olmos – Reflexiones sobre el tráfico internacional de niños y
  niñas ante la emigración forzada de venezolanos (Reflections on international
  child trafficking in the face of forced migration of Venezuelans).
• Mirian
  Rodríguez Reyes de Mezoa y Claudia Lugo Holmquist – Criterios atributivos de
  jurisdicción en el sistema venezolano de Derecho internacional privado en
  materia de títulos valores (Attributive criteria of jurisdiction in the
  Venezuelan system of Private International Law on securities trading matters).
• Nuria
  González Martín – Globalización familiar: nuevas estructuras para su estudio (Globalization
  of the family: new structures for its study).
• Peter Mankowski – A very
  special type of renvoi in contemporary Private International Law. Article 4 Ley de Derecho
  Internacional Privado of Venezuela in the light of recent
  developments.
• Ramón
  Escovar Alvarado – Régimen aplicable al pago de obligaciones en moneda
  extranjera (Regime applicable to the payment of obligations in foreign
  currency).
• Roberto
  Ruíz Díaz Labrano – El principio de autonomía de la voluntad y las relaciones
  contractuales (The party autonomy principle and contractual relations).
• Stefan
  Leible – De la regulación de la parte general del Derecho internacional privado
  en la Unión Europea (Regulation of the general part of Private International
  Law in the European Union).
• Symeon c. Symeonides – The Brussels
  I Regulation and third countries.
• Víctor
  Gregorio Garrido R. – Las relaciones funcionales entre el forum y el ius en el
  sistema venezolano de derecho internacional privado (The functional relations
  between forum and ius in the Venezuelan system of private international law.

As we see, the contributions
are not just from Venezuelan scholars, but from important professors and
researchers from Latin America, USA and Europe. All of them (as well as those included
in the other three volumes) pay due homage to an admirable person by offering
new ideas and insights in several areas of law and related sciences.

The book will be
available for sale soon. Is a must have publication for anyone interested in
Private International Law and Comparative Law.

As reported previously, the ECtHR was asked by the French Cour de cassation for an advisory opinion on the legal parentage of children born through surrogacy arrangement. In its answer, the Court considered that the right to respect for private life (article 8 of ECHR) requires States parties to provide a possibility of recognition of the child’s legal relationship with the intended mother. However, according to the Court, a State is not required, in order to achieve such recognition, to register the child’s birth certificate in its civil status registers. It also declared that adoption can serve as a means of recognizing the parent-child relationship.

The ECtHR’s opinion thus confirms the position reached by French courts: the Cour de cassation accepted to transcribe the birth certificate only when the intended father was also the biological father. Meanwhile, the non-biological parent could adopt the child (See for a confirmation ECtHR, C and E v. France, 12/12/2019 Application n°1462/18 and n°17348/18).

The ECtHR advisory opinion was requested during the trial for a review of a final decision in the Mennesson case. Although it is not compulsory, the Cour de cassation has chosen to comply with its recommendations (Ass. plén. 4 oct. 2019, n°10-19053). Referring to the advisory opinion, the court acknowledged that it had an obligation to provide a possibility to recognize the legal parent-child relationship with respect to the intended mother. According to the Cour de cassation, the mere fact that the child was born of a surrogate mother abroad did not in itself justify the refusal to recognize the filiation with the intended mother mentioned in the child’s birth certificate.

When it comes to the mean by which this recognition has be accomplished, the Cour de cassation recalled that the ECtHR said that the choice fell within the State’s margin of appreciation. Referring to the different means provided under French law to establish filiation, the Court considered that preference should be given to the means that allow the judge to exercise some control over the validity of the legal situation established abroad and to pay attention to the particular situation of the child. In its opinion, adoption is the most suitable way.

However,
considering the specific situation of the Mennesson twins who had been involved
in legal proceedings for over fifteen years, the Court admitted that neither an
adoption nor an apparent status procedure were appropriate as both involve a
judicial procedure that would take time. This would prolong the twins’ legal
uncertainty regarding their identity and, as a consequence, infringe their
right to respect for private life protected by article 8 ECHR. In this
particular case, this would not comply with the conditions set by the ECtHR in
its advisory opinion: “the procedure laid down by the domestic law to ensure
that those means could be implemented promptly and effectively, in accordance
with the child’s best interest”.

As
a result and given the specific circumstances of the Mennessons’ situation, the
Cour de cassation decided that the best means to comply with its
obligation to recognize the legal relationship between the child and the
intended mother was to transcribe the foreign birth certificate for both
parents.

The
Cour de cassation’s decision of October 2019 is not only the final act
of the Mennesson case, but it also
sets a modus operandi for future proceedings regarding legal parentage
of children born trough surrogate arrangements: when it comes to the relation
between the child and the intended mother, adoption is the most suitable means provided
under domestic French law to establish filiation. When such an adoption is
neither possible nor appropriate to the situation, judges resort to transcribing
the foreign birth certificate mentioning the intended mother. Thus, adoption
appears as the principle and transcription as the exception.

Oddly
enough, the Court then took the first chance it got to reverse its solution and
choose not to follow its own modus operandi.

By two decisions rendered on December 18^th 2019 (Cass. Civ. 1ère, 18 déc. 2019, n°18-11815 and 18-12327), the Cour de cassation decided that the intended non-biological father must have its legal relationship with the child recognized too. However, it did not resort to adoption as a suitable means of establishing the legal relationship with the intended parent. Instead, the court held that the foreign birth certificate had to be transcribed for both parents, while no references were made to special circumstances which would have justified resorting to a transcription instead of an adoption or another means of establishing filiation.

The Court used a similar motivation to the one used in 2015 for the transcription of the birth certificate when the intended father is also the biological father. It considered that neither the fact that the child was born from a surrogate mother nor that the birth certificate established abroad mentioned a man as the intended father were obstacles to the transcription of the birth certificate as long that they complied with the admissibility conditions of article 47 of the Civil Code.

But
while in 2015 the Court referred to the fact that the certificate “did not
contain facts that did not correspond to reality”, which was one of the
requirements of article 47, in 2019 this condition is no longer required.

Thus,
it seems that the Cour de cassation is no longer reluctant to allow the
full transcription of the foreign birth certificate of children born of
surrogate arrangements. After years of constant refusal to transcribe the birth
certificate for the non-biological parent, and just a few months after the ECtHR
advisory opinion accepting adoption as a suitable means to legally recognize
the parent-child relationship, this change of view was unexpected.

However,
by applying the same treatment to both intended parents, biological and non-biological,
this reversal of solution put into the spotlight the publicity function of the
transcription into the French civil status register. As the Cour de
cassation emphasized, a claim for the transcription of a birth certificate
is different from a claim for the recognition or establishment of filiation.
The transcription does not prevent later proceedings directed against the child-parent
relationship.

But
the end is still not near!  On January 24^th,
during the examination of the highly sensitive Law of Bioethics, the Sénat
(the French Parliament’s upper house) adopted an article prohibiting the full transcription
of the foreign birth certificates of children born trough surrogate arrangements.
This provision is directly meant to “break” the Cour de cassation’s
solution of December 18^th 2019. The article will be discussed in
front of the Assemblée nationale, the lower house, and the outcome of
the final vote is uncertain.

The
conflict over the legal parentage of children born trough surrogate arrangements
is not over yet.  To be continued…

By Dr Lukas Schmidt (PhD EBS Law School), law clerk (Rechtsreferendar) at the Regional Court of Wiesbaden, Germany

In
cross-border insolvencies questions of international jurisdiction might arise either
in relation to the opening of an insolvency proceeding as such, or – further
down the road – in relation to proceedings deriving from already opened insolvency
proceedings. In both cases the European Insolvency Regulation Recast
(Regulation 2015/848) provides for answers: According to Article 3 of the
Regulation the courts of the Member State within the territory of which the
centre of a debtor’s main interests is situated shall have jurisdiction to open
insolvency proceedings. Article 6 of the Regulation provides that the courts in
such Member States shall have jurisdiction as well for actions deriving
directly from insolvency proceedings and closely linked with them. Both kind of
decisions are to be automatically recognized in all other member states, either
through Art. 19 (judgments opening insolvency proceedings) or through Art. 32
(other judgments).

Whereas
Article 3 is also to be found in the old EIR (Regulation 1346/2000) as is
Article 19 (Article 16) and Article 32 (Article 25), Article 6 is a new
provision, however based without any doubt on the ECJ´s settled case law (Seagon,
C-339/07 and Schmid, C-382/12) on the old EIR. Still on the old regulation, but
with effect also for Art. 6 and 32 EIR, the ECJ has now specified in the case
UB v. VA and others (C-493-18) the scope and the exclusive nature of the vis
attractiva concursus as (now) laid down in Art. 6 of the EIR.

Some
facts are necessary to understand the case:

The
insolvent debtor UB, a Dutch citizen, owned an apartment and a property complex
in France. Although his assets had been frozen by an English court he and his
sister VA signed an acknowledgement of debt by which UB acknowledged owing VA
the sum of EUR 500 000 in respect of various loans. UB undertook to repay that
sum by 22 August 2017 and subsequently mortgaged, in favour of VA, the
apartment and the property complex which he owned in France. In March 2010 he
had sold the apartment to Tiger, a company founded by VA. On 10 May 2011
insolvency proceedings were opened against UB in the United Kingdom by the
Croydon County Court. The Croydon County Court authorised the insolvency
administrator, to bring an action before the courts in France in order to
obtain a ruling that the sale of the properties and the mortgages granted over
those properties were avoidable under the relevant United Kingdom bankruptcy
law provisions. The insolvency administrator made use of this authorisation and
succeeded before the French Regional Court and the Court of Appeal. However,
the Court of Cassation referred the question of international jurisdiction of
the French courts (and its recognition) to the ECJ for a preliminary ruling.

By
answering the first two referred questions the ECJ has made clear – rather not
surprising – that an action brought by the trustee in bankruptcy appointed by a
court of the Member State within the territory of which the insolvency
proceedings were opened seeking a declaration that the sale of immovable
property situated in another Member State and the mortgage granted over it are
ineffective as against the general body of creditors falls within the exclusive
jurisdiction of the courts of the first Member State.

The
ECJ has pointed out that for determining whether actions derive directly from insolvency
proceedings not the procedural context of the action is decisive, but its legal
basis (the trustee asked the French courts to rule on a declaration of
ineffectiveness rather than on an action to set the transactions aside).

Equally
insignificant for international jurisdiction to hear an action for the
restitution of immovable property to the bankruptcy estate is where those
assets are located. The court underlines that the objective of improving the
efficiency and speed of cross-border insolvency proceedings is only consistent
with concentrating all the actions directly related to the insolvency
proceedings before the courts of the Member State within the territory of which
those proceedings were opened.

More intriguing
and not yet subject to the ECJ’s case law is the question whether a court can
confer its international jurisdiction according to Art. 6 EIR. Eventually, this
is what the Croydon Country Court did by authorizing the administrator to bring
an action before the French courts in order to obtain a ruling that UB´s deals
regarding the French properties were avoidable transactions under the relevant
United Kingdom bankruptcy law provisions. The referring Court of Cassation therefore
asked in his third question if the UK court’s decision authorizing the
insolvency administrator to bring an action before the French courts could be
classified as a judgment concerning the course of insolvency proceedings within
the meaning of Article 25 (now Article 32), which may, on that basis, be
recognised with no further formalities, pursuant to that article.

The
court’s answer to this question is in line with its decision in Wiemer &
Trachte v. Tadzher (C-296/17) in which it already confirmed the exclusive
jurisdiction of the courts of the Member State within the territory of which
insolvency proceedings have been opened for set aside actions. Hence, the ECJ
refused the UK court’s approach quite quickly stating that Article 25 (now 32)
EIR cannot be interpreted in such a way as to call into question the said exclusive
nature of the international jurisdiction of the courts of the Member State
within the territory of which the insolvency proceedings were opened to hear
actions which derive directly from those proceedings and which are closely
connected with them. According to the ECJ Article 25 EIR merely allows for the
possibility that the courts of a Member State within the territory of which
insolvency proceedings have been opened may also hear and determine an action
which derives directly from those proceedings and is closely connected with
them, whether that be the court which opened the insolvency proceedings under
Article 3(1), or another court of that same Member State having territorial and
substantive jurisdiction.

by Matthias Lehmann

Smart contracts and the conflict of laws is a widely discussed topic today (see for instance the post by Giesela Rühl). A new contribution to this debate comes from ISDA, the International Swaps and Derivatives, in collaboration with the Singapore Academy of Law and leading law firms. Also involved is the provider of an existing smart contract platform (Corda), which guarantees the paper’s practical relevance. The analysis focuses on a potential smart derivative contract to be implemented on Corda. 

The
authors of the paper take the view that a court in Singapore and the
UK would have little difficulties in determining the law governing
such a contract – it would simply be the one chosen in the
derivatives master agreement. The same goes for the choice of the
competent court. In this context, it is important to note that only
B2B transactions are considered, with no consumer contracts being
involved. The authors also see little risk for the intervention of
public policy rules.

Collateralised
derivative transactions, which are of utmost practical importance,
are more problematic to the extent that the collateral is governed by
the lex
rei sitae.
But the paper also sees a way out here: The collateral could be
represented by a token (through so-called tokenisation). Given
that tokens have no real geographic location, the law applicable to
the token could be determined again by a choice of the parties. 

The
paper even suggests an innovative way to avoid the need for
enforcement: The parties could agree that the “notary” of the
platform must implement any judgment rendered by the chosen court. In
this way, the need to apply for cross-border recognition and
enforcement in the country in which the platform is established would
fall away. 

Whether
this proposal works in practice remains to be seen. One may
reasonably fret that the platform will not enjoy complete immunity
from the country in which it is established. As long as the courts of
this country are liberal, there is however little reason for fear.
The Singapore High Court has already shown
its readiness
to extending property protection to the holders of cryptocurrencies.
The country could thus provide a safe haven for the operation of a
smart derivatives platform, but that does not exclude the continuing
power of its courts to intervene and the possible application of
national law, e.g. in case of an insolvency of the platform provider.

Written by Prof. Dr. Stefan Arnold, Thorben Eick and Cedric Hornung, University of Münster

Digitization, Artificial Intelligence and the blockchain technology are core elements of a historic transformation of modern society. Such transformations necessarily challenge traditional legal concepts. Hitherto, the academic discourse is much more intense in the area of substantial private law than it is in the area of Private International Law. Thus, a conference on the specific challenges of Artificial Intelligence and Digitization for Private International Law was long overdue. Stefan Arnold and Gerald Mäsch of the Institute of International Business Law (WWU Münster) organized a conference with that specific focus on November 8th at Münster University. The title of the conference was »Conflict of laws 4.0: Artificial Intelligence, smart contracts and bitcoins as challenges for Private International Law«. Around a hundred legal scholars, practitioners, doctoral candidates and students attended the conference.

The first speaker, Wolfgang Prinz of Fraunhofer Institute and Aachen University, provided insight into the necessary technical background. His presentation made clear that blockchain technology is already a key factor in international contracting, as e.g. in agricultural crop insurance policies. This introduction into complex digital processes to a largely non-tech-expert audience helped kick off the first round of vivid discussion. 

Michael Stürner of Konstanz University devoted his presentation to smart contracts and their role in applying the Rome I Regulation. After raising the question of a specific lex digitalis, he focused on the scope of the Regulation with regard to qualification, choice of law and the objective connecting factors. While he concluded that the respective contracts can mainly be treated on the basis of the Rome I Regulation, he also took a quick glance on subsequent questions in terms of virtual securities and the statute of form.

In the third presentation, Stefan Arnold of Münster University explored the issues Artificial Intelligence raises concerning party autonomy and choice of law. At the beginning of his presentation, he emphasized that these questions are closely related to the different levels of AI and their (lack of) legal capacity: As long as machines act as simple executors of human will, one should establish a normative attribution to the human being in question. For the cases in which the AI exceeds this dependency, Arnold claimed there was no answer in the Rome I Regulation, leaving the way open for the national rules, primarily Art. 5 II EGBGB. Finally, he discussed possibilities de lege ferenda such as applying the law of the country of effect and future gateways for the ordre public.

Jan Lüttringhaus of Hannover University presented about questions of insurance and liability in the context of Private International Law. In order to underline the importance of this topic, he referred to a provision in the usual insurance conditions presupposing the application of German national law. In a first step, he examined the international civil procedure law of the Brussels I bis Regulation as well as potential difficulties with state immunity. The second part of his lecture was dedicated to the problem of determining the applicable law in situations that feature a decentralization of injury and damage.

In the following presentation, Gerald Mäsch of Münster University proposed a solution for finding the applicable law to Decentralized Autonomous Organizations (DAOs). When legal practitioners try to determine which law applies, they usually resort to the traditional rules of domicile and establishment. Since DAOs have neither of the two, it cannot be subjected to the law of a specific nation by these two approaches. Leaving the international corporate law behind, Mäsch called for a return to the basics: If there is no primary choice of law, one should plainly refer back to the most significant relationship as stated by Savigny. Acknowledging the regular lack of publicity, he nonetheless insisted that this solution answered the parties’ needs at the best possible rate.

Bettina Heiderhoff of Münster University presented on how questions of liability can be solved in the context of autonomous systems. She started her presentation by raising the question whether autonomous systems could simply fall into the scope of the Product Liability Directive. Following up, the speaker focused on new fund and insurance systems and the deriving problems with regard to conflict of laws. She expanded upon Art. 5 of the Rome II Regulation and its applicability on autonomous systems, emphasizing the legislator’s intention behind the respective rules. 

In the following presentation, Matthias Lehmann of Bonn University examined the interaction between blockchain, bitcoin and international financial market law. After a short introduction into the basics of Distributed Ledger Technology (DLT), he shed light onto problems in international banking supervision and how they could be solved by implementing DLT-based solutions. He closed with a plea for common international regulations regarding cryptocurrencies.

Concluding remarks from a practitioners’ point of view were made by Ruth-Maria Bousonville and Marc Salevic from Pinsent Masons LLP. The speakers shared their perspective on the topics that had been raised by their predecessors and how practitioners deal with these questions in creating solutions for their clients. 

Written by Dr Rishi Gulati, Barrister, Victorian Bar, Australia; LSE Fellow in Law, London School of Economics

The interaction between public and private international law is becoming more and more manifest. There is no better example of this interaction than the Shape v Supreme litigation ongoing before Dutch courts, with the most recent decision in this dispute rendered in December 2019 in Supreme Headquarters Allied Powers Europe (“SHAPE”) et al v Supreme Site Service GmbH et al (Supreme), COURT OF APPEAL OF ‘s-HERTOGENBOSCH, Case No. 200/216/570/01, Ruling of 10 December 2019 (the ‘CoA Decision’). I first provide a summary of the relevant facts. Second, a brief outline of the current status of the litigation is provided. Third, I make some observations on how public and private international law interact in this dispute. 

1 Background to the litigation

In 2015, the Supreme group of entities (a private actor) brought proceedings (the ‘Main Proceedings’) against two entities belonging to the North Atlantic Treaty Organisation (‘NATO’) (a public international organisation) before a Dutch district court for alleged non-payments under certain contracts entered into between the parties for the supply of fuel (CoA Decision, para 6.1.12). The NATO entities against whom the claims were brought in question were Shape (headquartered in Belgium) and Allied Joint Force Command Headquarters Brunssum (JFCB) (having its registered office in the Netherlands). JFCB was acting on behalf of Shape and concluded certain contracts (called BOAs) with Supreme regarding the supply of fuel to SHAPE for NATO’s mission in Afghanistan carried out for the International Security Assistance Force (ISAF) created pursuant to a Chapter VII Security Council Resolution following the September 11 terrorist attacks in the United States (CoA Decision, para 6.1.8). While the payment for the fuels supplied by Supreme on the basis of the BOAs was made subsequently by the individual states involved in the operations in Afghanistan, ‘JFCB itself also purchased from Supreme. JFCB paid Supreme from a joint NATO budget. The prices of fuel were variable. Monitoring by JFCB took place…’ (CoA Decision, para 6.1.9. The applicable law of the BOAs was Dutch law but no choice of forum clause was included (CoA Decision, para 6.1.9). There was no provision for arbitration made in the BoAs (CoA Decision, para 6.1.14.1). However, pursuant to a later Escrow Agreement concluded between the parties, upon the expiry of the BoAs, Supreme could submit any residual claim it had on the basis of the BOAs to a mechanism known as the Release of Funds Working Group (‘RFWG’). Pursuant to that agreement, an escro account was also created in Belgium. The RFWG comprises of persons affiliated with JFCB and SHAPE, in other words, NATO’s representatives (CoA Decision, para 6.1.10). Supreme invoked the jurisdiction of Dutch courts for alleged non-payment under the BOAs. The NATO entities asserted immunities based on their status as international organisations (‘IOs’) and succeeded  before the CoA meaning that the merits of Supreme’s claims has not been tested before an independent arbiter yet (more on this at 2). 

In a second procedure, presumably to protect its interests, Supreme also levied an interim garnishee order targeting Shape’s escrow account in Belgium (the ‘Attachment Proceedings’) against which Shape appealed (see here for a comment on this issue). The Attachment Proceedings are presently before the Dutch Supreme Court where Shape argued amongst other things, that Dutch courts did not possess the jurisdiction to determine the Attachment Proceedings asserting immunities from execution as an IO (see an automated translation of the Supreme Court’s decision here (of course, no guarantees of accuracy of translation can be made)). The Dutch Supreme Court made a reference for a preliminary ruling to the European Court of Justice (‘CJEU’) (case C-186/19). It is this case where questions of European private international law have become immediately relevant. Amongst other issues referred, the threshold question before the CJEU is:

Must Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast) (OJ 2012 L 351, p. 1 [Brussels Recast] be interpreted as meaning that a matter such as that at issue in the present case, in which an international organisation brings an action to (i) lift an interim garnishee order levied in another Member State by the opposing party, and (ii) prohibit the opposing party from levying, on the same grounds, an interim garnishee order in the future and from basing those actions on immunity of execution, must be wholly or partially considered to be a civil or commercial matter as referred to in Article 1(1) of the Brussels I Regulation (recast)? 

Whether the claims pertinent to the Attachment Proceedings constitute civil and commercial matters within the meaning of Article 1 of the Brussels Recast is a question of much importance. If it cannot be characterised as civil and commercial, then the Brussels regime cannot be applied and civil jurisdiction will not exist.  If jurisdiction under the Brussels Recast does not exist, then questions of IO immunities from enforcement become irrelevant at least in an EU member state. The CJEU has not yet ruled on this reference. 

2 The outcome so far 

Thus far, the dispute has focused on questions of jurisdiction and IO immunities. These issues arise in somewhat different senses in both sets of proceedings. 

The Main Proceedings

Shape and JFCB argue that Dutch courts lack the jurisdiction in public international law to determine the claims brought by Supreme as NATO possesses immunities given its status as an IO (CoA Decision, para 6.1.13). The rules and problems with the law on IO immunities have been much discussed, including by this author in this very forum. Two things need noting. First, in theory at least, the immunities of IOs such as NATO are delimited by the concept of ‘functionalism’ – IOs can only possess those immunities that are necessary to protect its functional independence. And second, if an IO does not provide for a ‘reasonable alternative means’ of dispute resolution, then national courts can breach IO immunities to ensure access to justice. According to the district court, as the NATO entities had not provided a reasonable alternative means of dispute resolution to Supreme, the former’s immunities could be breached. The CoA summarised the district court’s decision on this point as follows (CoA Decision, para 6.1.14): 

[T]he lack of a dispute settlement mechanism in the BOAs, while a petition to the International Chamber of Commerce was agreed in a similar BOA agreed with another supplier, makes the claim of an impermissible violation of the right to a fair trial justified. The above applies unless it must be ruled that the alternatives available to Supreme comply with the standard in the Waite and Kennedy judgments: there must be “reasonable means to protest effectively rights”. The District Court concludes that on the basis of the arguments put forward by the parties and on the basis of the documents submitted, it cannot be ruled that a reasonable alternative judicial process is available.

The CoA disagreed with the district court. It said that this was not the type of case where Shape and JFCB’s immunities could be breached even if there was a complete lack of a ‘reasonable alternative means’ available to Supreme (CoA Decision, para 6.7.8 and 6.7.9.1). This aspect of the CoA’s Decision was made possible because of the convoluted jurisprudence of the European Court of Human rights where that court has failed to provide precise guidance as to when exactly IO immunities can be breached for the lack of a ‘reasonable alternative means’, thereby giving national courts considerable leeway. The CoA went on to further find that in any event, Supreme had alternative remedies: it could bring suit against the individual states part of the ISAF action to recover its alleged outstanding payments (CoA Decision, para 6.8.1); and could have recourse to the RFWG (CoA Decision, para 6.8.4). This can hardly be said to  constitute a ‘reasonable alternative means’ for Supreme would have to raise claims before the courts of multiple states in question creating a risk of parallel and inconsistent judgments; the claims against a key defendant (the NATO entities) remain unaddressed; and the RFWG comprises representatives of the defendant completely lacking in objective independence. Perhaps the CoA’s decision was driven by the fact that Supreme is a sophisticated commercial party who had voluntarily entered into the BOAs where the standards of a fair trial in the circumstances can be arguably less exacting (CoA Decision, para 6.8.3).

On the scope of Shape’s and JFCB’s functional immunities, the CoA said that ‘if immunity is claimed by SHAPE and JFCB in respect of (their) official activities, that immunity must be granted to them in absolute terms’ (CoA Decision, para 6.7.9.1). It went on to find:

The purchase of fuels in relation to the ISAF activities, to be supplied in the relevant area of operations in Afghanistan and elsewhere, is directly related to the fulfilment of the task of SHAPE and JFCB within the framework of ISAF, so full functional immunity exists. The fact that Supreme had and has a commercial contract does not change the context of the supplies. The same applies to the position that individual countries could not invoke immunity from jurisdiction in the context of purchasing fuel. What’s more, even if individual countries – as the Court of Appeal understands for the time being before their own national courts – could not invoke immunity, this does not prevent the adoption of immunity from jurisdiction by SHAPE and JFCB as international organisations that, in concrete terms, are carrying out an operation on the basis of a resolution of the United Nations Security Council CoA Decision, para 6.7.9.2).

Acknowledging that determining the scope of an IO’s functional immunity is no easy task, the CoA’s reasoning is somewhat surprising. The dispute at hand is a contractual dispute pertaining to alleged non-payment under the BOAs. One may ask the question as to why a classical commercial transaction should attract functional immunity? Indeed, other IOs (international financial institutions) have included express waiver provisions in their treaty arrangements where no immunities exist in respect of business relationships between an IO and third parties (see comments on the Jam v IFC litigation ongoing in United States courts by this author here). While NATO is not a financial institution, it should nevertheless be closely inquired as to why NATO should possess immunities in respect of purely commercial contracts it enters into. This is especially the case as the CoA found that the NATO entities in question did not possess any treaty based immunities (CoA Decision, para 6.6.7), and upheld its functional immunities based on customary international law only (CoA Decision, para  6.7.1), a highly contested issue (see M Wood, ‘Do International Organizations Enjoy Immunity Under Customary International Law?’ (2013) 10 IOLR 2). It is likely that the CoA Decision would be appealed to the Dutch Supreme Court and any further analysis must await a final outcome.

The Attachment Proceedings

The threshold question in the Attachment Proceedings is whether Dutch courts possess civil jurisdiction under the Brussels Recast to determine the issues in that particular case. If the claim is not considered civil and commercial within the meaning of Article 1 of the Brussels Recast, then no jurisdiction exists under the rules of private international law and the claim comes to an end, with the issue of immunities against enforcement raised by the NATO entities becoming superfluous. This is because if a power to adjudicate does not exist, then the question on the limitations to its exercise due to any immunities obviously becomes irrelevant. Perhaps more crucially, after the CoA Decision, the ongoing relevance of the Attachment Proceedings has been questioned. As has been noted here:

At the public hearing in C-186/19 held in Luxembourg on 12 December, the CJEU could not hide its surprise when told by the parties that the Dutch Appellate Court had granted immunity of jurisdiction to Shape and JCFB. The judges and AG wondered whether a reply to the preliminary reference would still be of any use. One should take into account that the main point at the hearing was whether the “civil or commercial” nature of the proceedings for interim measures should be assessed in the light of the proceedings on the merits (to which interim measures are ancillary, or whether the analysis should solely address the interim relief measures themselves.

Given that a Supreme Court appeal may still be filed in the Main Proceeding potentially reversing the CoA Decision, the CJEU’s preliminary ruling could still be of practical relevance.  In any event, in light of the conceptual importance of the central question regarding the scope of the Brussels Recast being considered in the Attachment Proceeding, any future preliminary ruling by the CJEU is of much significance for European private international law. Summarising the CJEU’s approach to the question at hand, the Dutch Supreme Court said:

The concept of civil and commercial matters is an autonomous concept of European Union law, which must be interpreted in the light of the purpose and system of the Brussels I-bis Regulation and the general principles arising from the national legal systems of the Member States.  In order to determine whether a case is a civil or commercial matter, the nature of the legal relationship between the parties to the dispute or the subject of the dispute must be examined.  Disputes between a public authority and a person governed by private law may also fall under the concept of civil and commercial matters, but this is not the case when the public authority acts in the exercise of public authority.  In order to determine whether the latter is the case, the basis of the claim brought and the rules for enforcing that claim must be examined.  For the above, see, inter alia, ECJ 12 September 2013, Case C-49/12, ECLI: EU: C: 2013: 545 (Sunico), points 33-35, ECJ 23 October 2014, Case C ? 302/13, ECLI: EU: C: 2014: 2319 (flyLal), points 26 and 30, and CJEU 9 March 2017, case C-551/15, ECLI: EU: C: 2017: 193 (Pula Parking), points 33-34 (see the automated translation of the Supreme Court’s decision cited earlier, para 4.2.1). 

There is not the space here to explore the case law mentioned above in any detail. Briefly, if the litigation was taken as a whole with the analysis taking into account the nature of the Main Proceedings as informing the characterisation of the Attachment Proceedings , there would be a close interaction between the scope of functional immunity and the concept of civil and commercial. If an excessively broad view of functional immunity is taken (as the CoA has done), then it becomes more likely that the matter will not be considered civil and commercial for the purposes of the Brussels system as the relevant claim/s can said to arise from the exercise of public authority by the defendants. However, as I said earlier, it is somewhat puzzling as to why the CoA decided to uphold the immunity of the defendants in respect of a purely commercial claim. 

However, it is worth noting that in some earlier cases, while the CJEU seem to take a relatively narrow approach to the scope of the Brussels system (CJEU Case C-29/76, Eurocontrol). More recent case law has taken a broader view.  For example, in Pula Parking, para. 39, the CJEU said ‘Article 1(1) of Regulation No 1215/2012 must be interpreted as meaning that enforcement proceedings brought by a company owned by a local authority…for the purposes of recovering an unpaid debt for parking in a public car park the operation of which has been delegated to that company by that authority, which are not in any way punitive but merely constitute consideration for a service provided, fall within the scope of that regulation’. If the true nature and subject of Supreme’s claims are considered,  it is difficult to see how they can constitute anything but civil and commercial within the meaning of the Brussels system in light of recent case law, with the issue of IO immunities a distraction from the real issues. It will be interesting to see if the CJEU consolidates its recent jurisprudence or prefers to take a narrower approach.

3 The interaction between public and private international law?

In the Main Proceedings, in so far as civil jurisdiction is concerned, already, the applicable law to the BOAs is Dutch law and Dutch national courts are perfectly suited to take jurisdiction over the underlying substantive dispute given the prevailing connecting factors. As the CoA determined that the NATO entities tacitly accepted the jurisdiction of the Dutch courts the existence of civil jurisdiction does not seem to be at issue (CoA Decision, para 6.5.3.4). Clearly, in a private international law sense, Dutch courts are manifestly the suitable forum to determine this claim. 

However, on its face, the norms on IO immunities and access to justice require balancing (being issues relevant to both public and private international law). As the district court found, if an independent mechanism to resolve a purely commercial dispute (such as an arbitration) is not offered to the claimant,    IO immunities can give way to ensure access to justice. Indeed, developments in general international law require the adoption of a reinvigorated notion of jurisdiction where access to justice concerns should militate towards the exercise of jurisdiction where not doing so would result in a denial of justice. Mills has said:

The effect of the development of principles of access to justice in international law also has implications when it comes to prohibitive rules on jurisdiction in the form of the immunities recognised in international law…Traditionally these immunities have been understood as ‘minimal’ standards for when a state may not assert jurisdiction — because the exercise of jurisdiction was understood to be a discretionary matter of state right, there was no reason why a state might not give more immunity than required under the rules of international law. The development of principles of access to justice, however, requires a state to exercise its jurisdictional powers, and perhaps to expand those jurisdictional powers as a matter of domestic law to encompass internationally permitted grounds for jurisdiction, or even to go beyond traditional territorial or nationality-based jurisdiction (A Mills, ‘Rethinking Jurisdiction in International Law’ (2014) British Yearbook of International Law, p. 219).

The Main Proceedings provide an ideal case where civil jurisdiction under private international law should latch on to public international law developments that encourage the exercise of national jurisdiction to ensure access to justice. Not only private international law should be informed by public international law developments, the latter can benefit from private international law as well. I have argued elsewhere that private international law techniques are perfectly capable of slicing regulatory authority with precision so that different values (IO independence v access to justice) can both be protected and maintained at the same time (see here). Similarly, in the Attachment Proceedings, a reinvigorated notion of adjudicative jurisdiction also demands that the private and public properly inform each other. Here, it is of importance that the mere identity of the defendant as an international public authority or the mere invocation of the pursuit of public goals (such as military action) does not detract from properly characterising the nature of a claim as civil and commercial. More specifically, any ancillary proceeding to protect a party’s rights where the underlying dispute is purely of a commercial nature ought to constitute a civil and commercial matter within the meaning of the Brussels system. Once civil jurisdiction in a private international law sense exists, then any immunities from enforcement asserted under public international law ought to give way to ensure that the judicial process cannot be frustrated by lack of enforcement at the end. It remains to be seen what approach the CJEU takes to these significant and difficult questions where the public and private converge.  

To conclude, only a decision on the merits after a full consideration of the evidence can help determine whether Supreme’s (which itself is accused of fraud) claims against Shape et al can be in fact substantiated. In the absence of an alternative remedy offered by the NATO entities, if the Dutch courts do not exercise jurisdiction, we may never know whether its claims are in fact meritorious.