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Opinion of Advocate General Szpunar, Case C-253/19 – Novo Banco, on the COMI under the European Insolvency Regulation
Today, Advocate General Szpunar delivered his Opinion in Case C-253/19 – MH, NI v. OJ, Novo Banco SA. As is generally known, Article 3 of Regulation 2015/848, entitled ‘International jurisdiction’, provides in paragraph 1:
‘The courts of the Member State within the territory of which the centre of the debtor’s main interests is situated shall have jurisdiction to open insolvency proceedings (“main insolvency proceedings”). The centre of main interests shall be the place where the debtor conducts the administration of its interests on a regular basis and which is ascertainable by third parties.
In the case of a company or legal person, the place of the registered office shall be presumed to be the centre of its main interests in the absence of proof to the contrary. That presumption shall only apply if the registered office has not been moved to another Member State within the 3-month period prior to the request for the opening of insolvency proceedings.
In the case of an individual exercising an independent business or professional activity, the centre of main interests shall be presumed to be that individual’s principal place of business in the absence of proof to the contrary. That presumption shall only apply if the individual’s principal place of business has not been moved to another Member State within the 3-month period prior to the request for the opening of insolvency proceedings.
In the case of any other individual, the centre of main interests shall be presumed to be the place of the individual’s habitual residence in the absence of proof to the contrary. This presumption shall only apply if the habitual residence has not been moved to another Member State within the 6-month period prior to the request for the opening of insolvency proceedings.’
As the Opinion explains (paras. 4 et seq.):
4. The applicants are married to each other and, since 2016, have been resident in Norfolk (United Kingdom), where they are engaged in paid employment. The couple made a request to the Portuguese courts to declare them insolvent. The court of first instance declared that it did not have international jurisdiction to rule on their request, holding that, under the fourth subparagraph of Article 3(1) of Regulation 2015/848, the centre of their main interests was their place of habitual residence, namely the United Kingdom.
5. The applicants brought an appeal against that judgment before the referring court, claiming that it was based on a misinterpretation of the rules laid down by Regulation 2015/848. In that regard, they submitted that, in so far as the sole immovable asset that they owned was located in Portugal, where all the transactions which gave rise to their insolvency had occurred, the centre of their main interests was not their place of habitual residence (United Kingdom), but was located in Portugal. Moreover, they claimed that there is no connection between their current place of residence and the events that led to their insolvency, which occurred entirely in Portugal.
6. The referring court has doubts as to the correct interpretation of Article 3(1) of Regulation 2015/848 and is uncertain, in particular, of the criteria to be used for the purpose of rebutting the simple presumption laid down in that provision for natural persons not exercising an independent business or professional activity, according to which, for such persons, the habitual residence of the concerned party is presumed to be the centre of that party’s main interests in the absence of proof to the contrary.
7. In that regard, the referring court points out that recital 30 of that regulation states that, in the case of natural persons not exercising an independent business or professional activity, it should be possible to rebut that presumption, for example where the major part of the debtor’s assets is located outside the Member State of the debtor’s habitual residence.
AG Szpunar proposed (paras. 65 et seq.) that the Court should answer the question referred for a preliminary ruling by the Tribunal da Relação de Guimarães (Court of Appeal, Guimarães, Portugal) as follows:
Article 3(1), first and fourth subparagraphs, of Regulation (EC) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings must be interpreted as meaning that the presumption that the habitual residence of a debtor who is a natural person not engaged in a self-employed activity is the centre of his main interests may be rebutted if the place of habitual residence does not fulfil its role as the place where a debtor’s economic decisions are taken, as the place where the majority of his revenue is earned and spent, or as the place where the major part of his assets is located.
However, that presumption cannot be rebutted in favour of the Member State within the territory of which a debtor’s sole immovable asset is located in the absence of any other indication that the centre of that debtor’s main interests is located in that Member State. That fact may be determined on the basis of objective factors which are ascertainable by third parties (current and potential creditors) and relate to the financial interests of that debtor.
The Volkswagen (VW) emissions scandal – The saga continues: Now it’s the turn of the Netherlands, France and Belgium
Thanks to the entering into force of the Dutch Collective Redress of Mass Damages Act (Wet afwikkeling massaschade in collectieve actie, WAMCA) on 1 January 2020, there has been an increase in prospective litigation against Volkswagen in the Netherlands and other countries in Europe involving the Volkswagen emissions scandal (also known as Dieselgate). We have previously reported on this law here and also on ongoing litigation against Volkswagen here (CJEU) and here (UK).
One of the institutes / organisations taking advantage of this opportunity is the Diesel Emissions Justice Foundation (DEJF), which was founded in the Netherlands, and which is seeking to be the exclusive representative in a collective redress action against Volkswagen. The DEJF is currently acting in the Netherlands, Belgium and France and has recently extended its activities to the rest of Europe provided that certain conditions are fulfilled (e.g. customers have not yet been compensated – one cannot be compensated twice and has to choose one representative – see more information here).
As indicated on its website, on 13 March 2020, DEJF summoned Volkswagen et al. to appear before the Amsterdam District Court under new WAMCA proceedings. DEJF requested to be appointed as the Exclusive Representative Organisation (“Lead Plaintiff”). A summary in English is available here and the full text in Dutch is available here. See a summary of the progress here.
Undoubtedly, the ongoing litigation in other parts of the world and its final outcome will have an impact on this action. We will keep you informed.
Sharing Economy in EU Private International Law
Edoardo Rossi has published (in Italian) a book on the Sharing Economic in EU Private International Law (“La Sharing Economy nel diritto internazionale privato europeo”). The author has kindly provided us with an abstract:
In the current economic and social context new and controversial sharing practices, offering anyone the opportunity to search for or make available goods or services on the market regardless of the professional or amateur nature of the persons involved, have emerged. These practices, very heterogeneous and concerning the most different areas of daily life, such as mobility, housing, business activities, communications, work, culture, communication, education and finance, have been linked to the notion of “sharing economy”, which brings them together by virtue of temporary access to goods or services, facilitated by the large-scale intervention of digital platforms, through which requests and offers are coordinated online in order to share goods or services.
The legitimacy of schemes linked to these new economic models has been challenged in a number of aspects, including low quality of services, safety of consumers, authorisation and licensing, taxes and compliance with competition rules. The inadequacy of the existing rules to deal with the provision of services through the sharing economy models has consequently emerged.
In spite of these critical profiles, the legal relations established through sharing economy platforms are constantly increasing around the world, implying the emergence of elements of transnationality, from which derives the recourse to the rules of private international law, in order to determine the applicable law and the judge competent to rule on any disputes.
The monograph thus attempts to analyse some of the most important private international law issues, such as the inadequacy of the party autonomy in regulating the phenomenon, especially with reference to the general terms and conditions of contract unilaterally drawn up by platform operators, which state that the latter is totally unrelated to the legal relations between users, often in conflict with the minimum level of consumer protection guaranteed by EU law and by the national legislations. Critical profiles have also been identified in the online conclusion of contracts that bind the parties involved in sharing economy legal relations, in ascertaining the effectiveness of consent on the choice of forum and choice of law clauses, in cases of potential related actions and in the location of the “domicile” of the platform operators.