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A Reform of French Law Inspired by an Inaccurate Interpretation of the EAPO Regulation?
Carlos Santaló Goris, Research Fellow at the Max Planck Institute Luxembourg for International, European and Regulatory Procedural Law and Ph.D. candidate at the University of Luxembourg, offers an analysis on the recently approved reform of the French Manual on Tax Procedures (“Livre des procédures fiscales”) influenced by Regulation No 655/2014, establishing a European Account Preservation Order (“EAPO Regulation”). The EAPO Regulation and other EU civil procedural instruments are the object of study in the ongoing EFFORTS project, with the financial support of the European Commission.
FICOBA (“Fichier national des comptes bancaires et assimilés”) is the French national register containing information about all the bank accounts in France. French bailiffs (“huissiers”) can rely on FICOBA to to facilitate the enforcement of an enforceable title or upon a request for information in the context of an EAPO proceeding (Article L151 A of the French Manual on Tax Procedures). In January 2021, the Paris Court of Appeal found discriminatory the fact that creditors could obtain FICOBA information in the context of an EAPO proceeding but not in the context of the equivalent French domestic provisional attachment order, the “saisie conservatoire” (for a more extended analysis of the judgment, see here). While an enforceable title is not a necessary precondition to access FICOBA in the context of an EAPO, under French domestic law it is. Against this background, the French court found that creditors who could apply for an EAPO were in a more advantageous position than those who could not. Consequently, it decided to extend access to FICOBA to creditors without an enforceable title who apply for a saisie conservatoire.
In December 2021, the judgment rendered by the Paris Court of Appeals was transposed into French law. In fact, the French legislator introduced an amendment to the French Manual on Tax Procedures, allowing bailiffs to collect information about the debtors’ bank accounts from FICOBA based on a saisie conservatoire (Art. 58 LOI n° 2021-1729 du 22 décembre 2021 pour la confiance dans l’institution judiciaire).
In is nevertheless noteworthy that the judgment of the Paris Court of Appeal that inspired such reform is based on a misinterpretation of the EAPO Regulation. Access to the EAPO Regulation’s information mechanism is limited to creditors with a title (either enforceable or not enforceable). Creditors without a title are barred from accessing the EAPO’s information mechanism. From the reasoning of the Paris Court of Appeal, it appears that the Court interpreted the EAPO Regulation as granting access to the EAPO’s information mechanism to all creditors, even to those without a title. Such an interpretation would have been in accordance with the EAPO Commission Proposal, which gave all creditors access to the information mechanism regardless of whether they had a title or not. However, the Commission’s open approach was received with scepticism by the Council and some Member States. Notably, France was the most vocal advocate of limiting the possibilities of relying on the EAPO information mechanism. It considered that only creditors with an enforceable title should have access to it. In particular, the French delegation argued that, under French law, only creditors with an enforceable title could access such sensitive data about the debtor. Eventually the European legislator decided to adopt a mid-way solution between the French position and the EAPO Commission Proposal: namely, in accordance with the Regulation creditors are required to have a title, though this does not have to be enforceable.
The following is an interesting paradox. Whereas France tried to adjust the EAPO’s information mechanism to the standards of French law, it was ultimately French law that was amended due to the influence of the EAPO Regulation. An additional paradox is that the imbalance between creditors who can access the EAPO Regulation and those who cannot (as emphasized and criticised by the Paris Court of Appeal) will continue to exist but with the order reversed. Once the French reform enters into force, creditors without a title who apply for a French saisie conservatoire of a bank account will be given access to FICOBA. Conversely, creditors who apply for an EAPO will continue to be required to have a title in order to access FICOBA. Only an amendment of the EAPO Regulation can change this.
The moment for considering a reform of the EAPO Regulation is approaching. In accordance with Article 53 of the EAPO Regulation, the European Commission should have sent to the European Parliament and the European Economic and Social Committee “a report on the application of this Regulation” by 18 January 2022. These reports should serve as a foundation to decide whether amendments to the EAPO Regulation are desirable. Perhaps, as a result of the experience offered with the judgment of the Paris Court of Appeal, the European legislator may consider extending the EAPO’s information mechanism beyond creditors with a title.
AG Maciej Szpunar on the interpretation of the ESR in relation to cross-border declarations of waiver of succession and on substitution and characterisation, Opinion of 20 January 2022, C-617/20 – T.N. et al. ./. E.G.
Yesterday, AG Maciej Szpunar delivered an Opinion (a French version is available, a German as well, not yet, however, an English one) that is of high relevance both to the practical application of the European Succession Regulation (ESR) as well as to issues of European choice of law methodology in relation to substitution and characterisation.
The case emerged from a preliminary reference by the German Higher Regional Court (Oberlandesgericht) Bremen of 11 November 2020 and involved the following facts:
The deceased person, a Dutch national, died in Bremen (habitual residence) on 21 May 2018. He left behind his widow (E.G.) and two descendants (T.N. and N.N.) of his formerly deceased brother. His widow applied by notarial deed of 21 January 2019 for the issuance of a joint certificate of inheritance to the Local Court of Bremen, attributing to her ¾ of the estate and 1/8 to each of T.N. and N.N. The two descendants, however, having their habitual residence in the Netherlands, declared their waiver of succession before the Rechtbank Den Haag on 30 September 2019. In the proceedings before the Local Court of Bremen, T.N. and N.N. were heard, and by letter of 13 December 2019 in Dutch language they submitted copies of their declarations of waiver (as well in Dutch). The German court answered that it would not be able to take notice of these documents as long as it would not receive a translation into German. The two descendants thereupon declared in German to the court by letter of 15 January 2020 that they had waived, properly registered with the Dutch court, and that under European law there would be no need for translation. By decision of 27 February 2020, the Local Court issued the certificate as applied for by the applicant, i.e. certifying T.N. and N.N. as co-heirs. The latters appealed against this decision and, on 30 June 2020 submitted colour copies of the deeds they had used in the Netherlands as well as German translations, on 17 August 2020 they submitted the original deeds. The Local Court referred the case to the Higher Regional Court Bremen and stated that it considers the time limit for waiver under section 1944 (1) German Civil Code of six weeks after gaining knowledge about the inheritance elapsed, as a declaration of waiver would have required timely submission of the original deeds.
Thereupon, the Higher Regional Court of Bremen, in essence, referred the question to the ECJ whether a waiver in the Member State of habitual residence of the heir other than the Member State of habitual residence of the deceased would be capable of replacing the waiver required by the applicable succession law by way of substitution or whether additional requirements exist, such as that the waiving heir informs, with a view to Recital 32 Sentence 2, the competent court in the Member State of habitual residence of the deceased and if so whether the official language of that court must be used and whether the original deeds must be used in order to comply with time limits under the applicable law.
AG Maciej Szpunar reframed this question (para. 34): According to his subtle analysis, the question should be whether Articles 13 and 28 ESR are, of course autonomously (see para. 50), to be interpreted to the effect that the requirement to declare a waiver before the competent court („Nachlassgericht“) must be characterised as a question of form rather than substance which would lead to the application of the law of the Member State of the waiving heirs on this point of form under Article 28 lit. b ESR. Whereas only if this question were to be characterised as a matter of substance, the question of substitution could at all be posed. It will not come as a surprise that with this point made, the result of the – careful and comprehensive – analysis of this issue of characterisation (paras. 45 – 69), including considerations on the effet utile of the ESR (para. 64), was that indeed the point must be considered as one of form. The consequence is that since the local form was complied with in the Netherlands, the waiver must be held valid as of 30 September 2019 and as such still in time under the applicable succession law – a result that indeed facilitates cross-border succession cases in an important aspect as it is the overall objective of the ESR.
Remains the problem of how to ensure that the competent court takes notice of such a waiver (paras. 70 et seq.). This is the issue of Recital 32 Sentence 2: „Persons choosing to avail themselves of the possibility to make declarations in the Member State of their habitual residence should themselves inform the court or authority which is or will be dealing with the succession of the existence of such declarations within any time limit set by the law applicable to the succession.“ However, as in the concrete case at hand the court definitively had knowledge about the waiver, the question was not relevant and thus remained expressly left open (para. 77). As it was expressly left open as irrelevant in the concrete case we may at least conclude that any kind of gaining knowledge must suffice. Then the only remaining question is what happens if the court did not gain any knowledge. From a practical point of view a party interested in bringing its waiver to the attention of the competent court, it seems that a letter (or even an email) to that court should suffice.
One last question. Could we not say: either it is “substance”, then Article 13 refers to the lex causae (German law) or it is “form”, then Article 28 refers to the same law (German law) under lit. a and then substitution comes up, or, alternatively, under lit. b, to the law for formal issues (Dutch law). And when further proceeding sub lit. a of Article 28, could not substitution provide for the same result, at least in this concrete case, than applying lit. b? If so, we might be tempted to add that two parallel avenues to the same result indicate quite reliably that the result must be the right one. It might have been for reasons of simplifying things that AG Maciej Szpunar did not fully map out these two avenues, all the more because substitution is a technique that is little explored on the level of the EU’s PIL. However, if even the referring national court directly asks about substitution, the ECJ should take the opportunity to give us a bit more insights on this classical concept of the general part of any PIL from the perspective of the EU’s conflicts of law methodology.
Let’s hope that the ECJ takes up the ball and discusses the theoretical connotations of this case on methodical questions of characterisation and substitution as precisely and subtly as it was done in the Opinion. The CoL community will certainly await the judgment with excitement.
Relevant provisions of the ESR
Article 13: Acceptance or waiver of the succession, of a legacy or of a reserved share
In addition to the court having jurisdiction to rule on the succession pursuant to this Regulation, the courts of the Member State of the habitual residence of any person who, under the law applicable to the succession, may make, before a court, a declaration concerning the acceptance or waiver of the succession, of a legacy or of a reserved share, or a declaration designed to limit the liability of the person concerned in respect of the liabilities under the succession, shall have jurisdiction to receive such declarations where, under the law of that Member State, such declarations may be made before a court.
Article 28: Validity as to form of a declaration concerning acceptance or waiver
A declaration concerning the acceptance or waiver of the succession, of a legacy or of a reserved share, or a declaration designed to limit the liability of the person making the declaration, shall be valid as to form where it meets the requirements of: (a) the law applicable to the succession pursuant to Article 21 or Article 22; or (b) the law of the State in which the person making the declaration has his habitual residence.
Recital 32:
In order to simplify the lives of heirs and legatees habitually resident in a Member State other than that in which the succession is being or will be dealt with, this Regulation should allow any person entitled under the law applicable to the succession to make declarations concerning the acceptance or waiver of the succession, of a legacy or of a reserved share, or concerning the limitation of his liability for the debts under the succession, to make such declarations in the form provided for by the law of the Member State of his habitual residence before the courts of that Member State. This should not preclude such declarations being made before other authorities in that Member State which are competent to receive declarations under national law. Persons choosing to avail themselves of the possibility to make declarations in the Member State of their habitual residence should themselves inform the court or authority which is or will be dealing with the succession of the existence of such declarations within any time limit set by the law applicable to the succession
South African court issues interdict against Shell concerning seismic survey
The High Court of the Eastern Cape in Makhanda (Grahamstown), South Africa, on 28 December 2021 issued an interim interdict to stop Shell from commencing seismic activity off the south-eastern coast of South Africa. The full judgment is available on Saflii.
From a conflict-of-laws perspective, the interdict raises some points of interest.
First, it provides two examples of the application of non-State law. In considering whether Shell has adequately informed the local communities of its plans, the judge took into account not only the South African legislation, but also of the local communities’ modes of communication and of seeking consensus. In this sense, even though Shell had published its intentions in newspapers, these have not reached the communities in which people were not necessarily able to read English and Afrikaans (the languages of the newspapers). The judge found that “the approach that was followed to consult was inconsistent with the communities’ custom of seeking consensus.” (para 25). The judgment implicitly recognise this custom as law. This approach is in line with the South African Constitution (sec. 211(3) states: The courts must apply customary law when that law is applicable, subject to the Constitution and any legislation that specifically deals with customary law.).
The next example of the application of non-State law is the Rio Declaration on Environment and Development (para 69 of the judgment) to find that where there are threats of serious or irreversible damage, the precautionary approach shall be taken, even in the absence of full scientific certainty (Principle 15 of the Declaration).
The second interesting point is that the judge allowed this civil action even though there was a public law remedy available to the applications, namely an application to the Minister to cancel or suspend the right to explore that was granted. The judge found that the time-consuming nature of that remedy and the unlikeliness of its success made it an unsatisfactory remedy (paras 74-77).
News
Global Value Chains and Transnational Private Law Workshop at Edinburgh Law School – Report
By Zihao Fan (Ph.D. Candidate in Law, Peking University Law School)
The ‘Global Value Chains and Transnational Private Law’ workshop was successfully held at Edinburgh Law School in a hybrid format from June 23 to 25, 2024. This project is funded by the Law Schools Global League (LSGL), convened by Prof. Verónica Ruiz Abou-Nigm (Edinburgh Law School) and Prof. Michael Nietsch (EBS Law School). The workshop attracted scholars and researchers from 15 universities and institutions worldwide. Over two days, participants shared inspiring work in progress and engaged in discussions on how transnational private law influences and shapes global supply chains. During the workshop plans for the upcoming publication and dissemination were discussed. This overview aims to briefly summarise the research outcomes presented during the workshop (following the sequence of the presentations).
Morning Session on 24 June
Dr. Catherine Pedamon (Westminster Law School) and Dr. Simone Lamont-Black (Edinburgh Law School) first introduced a previous related workshop held in Edinburgh Law School on ‘Sustainability in the Food Supply Chain: Challenges and the Role of Law & Policy’. This project consists of contributions from a variety of legal and policy areas at the UK, EU, and international levels, focusing on the role of law (including commercial law, contract law, competition law, and corporate law) in resolving regulatory difficulties and opportunities in food supply chains, with a particular emphasis on sustainability and food security, therefore highly connected to the current project.
Afterwards, Dr. Pedamon and Dr. Lamont-Black also presented their research titled ‘Responsible Contracting in Agri-Food Supply Chains: Mitigating Power Asymmetries on the Road Towards Sustainability’. They pointed out that recent events like the Covid-19 pandemic, the war in Ukraine, climate-related price instability, and inflation have severely impacted the global economy, creating an unprecedented food crisis. Complex food supply chains reveal power imbalances, with larger trading partners often imposing unfair practices on less powerful suppliers. This research aims to shed light on the issues surrounding governance gaps and the various challenges and opportunities that arise from private international law, examining UK domestic law pertaining to food supply relationships, taking the EU level regulation into account, and providing potential examples of its implementation.
Dr. Francesca Farrington (School of Law, University of Aberdeen) and Dr. Nevena Jevremovic (School of Law, University of Aberdeen) then presented their work titled ‘Private International Law and the Race to the Bottom in Labour Standards: The Case of Begum v Maran’, discussed the recent Court of Appeal case, Begum v Maran. They noted that the literature has generally focused on the unique arguments relating to duty of care, and the Court of Appeal’s conclusion that the claim was not fanciful – it illustrates that the Rome II Regulation does little to prevent a ‘race to the bottom’ in labour standards especially given that corporate liability was a rapidly expanding field of law. They also discussed the different results when courts adopting different characterization methods on business-related human rights (BHR) claims.
Dr. Sara Sanchez Fernandez (IE Law School, Spain) shared her research on ‘Civil Liability under the CS3D: International Jurisdiction Rules and Access to an Effective Legal Remedy’. She first introduced the background: the EU recently enacted the Corporate Sustainability Due Diligence Directive (CS3D), which establishes due diligence responsibilities and civil consequences for violations of such obligations. The CS3D establishes rules for organizations’ risk-based due diligence requirements across their entire value chain. Her research centred on the assurance of access to Member State courts for CS3D-related issues, scrutinizing the interaction between CS3D, international jurisdiction in the Brussels I bis Regulation, and the foreign jurisdiction rules of Member States. She also explored the potential solutions for cases where entities are non-EU domiciled.
First Afternoon Session on 24 June
Prof. Toshiyuki Kono (Faculty of Law, Kyushu University) and Prof. Ren Yatsunami (Faculty of Law, Kyushu University) presented their work on ‘The Global Value Chain & Network Responsibility: The New Possibilities of Private Ordering’. They pointed it out that in recent years, policymakers and scholars from numerous disciplines have concentrated on mapping the outlines of the modern global value chain, with the concept of ‘network’ emerging as a repeating theme. They investigate the relevance of viewing networks as lenses through which better understand the GVC and its regulation, particularly in terms of human rights and environmental issues. Besides, they also examine the failure of the network and related legal responses, suggesting that a mixture of public and private norms, hard laws and soft laws should be considered as alternatives.
Prof. Carlos Vasquez (Georgetown Law School, US) then discussed his research on ‘Applicable Law in BHR Cases’. He focused on the applicable substantive law in BHR suits brought in developed countries (usually the home state of the defendant corporation) for injuries suffered in developing countries (the host state). He centred on both vertical and horizontal choice-of-law inquiries: ‘vertical’ refers to the decision-making process that involves choosing between international law and national (or subnational) law as the primary source of relevant law, while ‘horizontal’ refers to the decision between applying the legal system of the host country or the legal system of the home State.
Dr. David Capper (School of Law, Queen’s University Belfast) presented his research next, on ‘Procedural Aspects of Transnational BHR-Litigation’. Continuing with BHR cases he discussed how victims of tortious conduct by multinational corporations are seeking remedy against the latter in a Global North jurisdiction, with a focus on the UK. He illustrated the procedural mechanisms in the UK that are available for mass tort litigation of this kind and suggested that the Group Litigation Order (GLO) would be the appropriate mechanism in the majority of cases of mass tort litigation. Then he elaborated on several aspects of GLO, including group registers, case management, and costs. Finally, he suggested examining the Okpabi case to see how GLOs work.
Second Afternoon Session on 24 June
Prof. Irene-Marie Esser (School of Law, University of Glasgow) and Dr. Christopher Riley (Durham Law School) presented their research on ‘Groups and Outsiders in the Context of Tort and Human Rights Violations’, examining the challenges that arise in protecting the interests of ‘outsiders’ from corporate groups’ misbehaviour. They argued that regulations applied to individual ‘stand-alone’ companies suffer weaknesses when applied to corporate groups. By using the UK’s experience of enforcing human rights norms against groups and of applying tort law, they demonstrate the implications of an ‘enterprise approach’ for regulation.
Dr. Catherine Pedamon (Westminster Law School) shared her work in progress on the French duty of vigilance. The French Loi de Vigilance has been enacted for seven years, yet its first decision was rendered on 5th December 2023. It still appears to be in the initial stages of development, not only due to its groundbreaking nature but also the obstacles to enforcement. She then shared some key preconditions on the applicability, the public availability of a vigilance liability plan, compensation for damages due to the companies’ failure to comply, etc. She also introduced the recent developments in the related cases in France.
Prof. Michael Nietsch discussed his research, ‘Corporate Accountability of Multinational Enterprises for Human Rights Abuses – Navigating Separate Legal Entity and Attribution under Delict’, elaborating the growing interest in corporate accountability for human rights violations in the German judicial system. In contrast to the UK, Germany has seen few incidents of damages lawsuit with the implementation of statutory due diligence procedures under the Supply Chain Due Diligence Act 2021 (Lieferkettensorgfaltspflichtengesetz, LkSG). Nonetheless, legal academics continue to discuss the basis for corporate liability for human rights violations under German private law, as well as the proper standards of care that arise as a result. This is a fundamental issue in German delict law and the separation of legal entities. He argued that the LkSG has ruled out private liability based on a violation of the Act’s due diligence criteria while allowing such liability on other grounds, which adds to the complexity.
At the end of the day, Dr. Juan Manuel Amaya Castro (Faculty of Law, University of the Andes, Colombia) presented his work on ‘Global Value Chains with a Human Face’. He discussed the definition of social traceability from a legal perspective and its requirements, purpose, and reasons for tracing a particular good in the supply chain. He then explained how traceability is mandated in due diligence and reporting legislation, pointing out that practices including auditing and certification, feedback loops, administrative guidelines, and civil liability standards should be considered.
Morning Session on 25 June
Dr. Biset Sena Güne? (Max Planck Institute for Comparative and International Private Law, Hamburg, Germany) started the day with her research, ‘Harmonisation of Private International Law Rules to Promote Sustainability in Global Value Chains?’. She elaborated that the role of private international law is frequently constrained concerning sustainability. In most cases, the ability to reach a truly sustainable outcome is dependent on the applicable private legislation. When this is the case, it is difficult to justify the need for harmonisation of current private international law standards without simultaneously focusing on uniform private law regulatory remedies. Nonetheless, she suggested that the need for harmonisation of private international law standards governing corporate social responsibility should be explored further and proposed a comparative approach for that further research.
The morning session on 25 June also discussed the plans for the upcoming publication and the dissemination conference to be held in Germany in 2025.
In summary, the workshop enabled fruitful discussion of work-in-progress and shared insights on the complexities of global value chains and the role of transnational private law. Key topics included sustainability, corporate accountability, and legal frameworks affecting global supply chains. The project successfully fosters international collaboration amongst and beyond LSGL researchers, nurturing comparative and interdisciplinary approaches. Participants gained a deeper understanding and ideas to take the research forward to address regulatory and coordination challenges in furthering sustainability in global commerce.
ASADIP: Call for papers – Annual Conference on 25-27 September 2024 (in Spanish)
The American Association of Private International Law (ASADIP) will be holding its annual XVII conference entitled “A Private International Law more intelligent and less artificial” from 25 to 27 September 2024 in Buenos Aires and Pilar (Argentina). This Conference is being organised together with the Jornadas Nacionales de Derecho Civil at the Universidad Austral (Argentina).
A call for papers has been extended to 15 August 2024. The topic is party autonomy in Private International Law. For more information, click here.
To register, click here (ASADIP members have 40 % discount, early bird registration possible).
Out Now: P. Perlingieri, G. Perlingieri, G. Zarra (eds), Istituzioni di diritto privato internazionale e europeo
Pietro Perlingieri, Giovanni Perlingieri, and Giovanni Zarra have edited a new book on Istituzioni di diritto privato internazionale e europeo.
The blurb reads as follows:
The book follows from the need for an interdisciplinary perspective to the regulation of civil relations, which also takes into account the direct and horizontal effects that international and European Union law may have on such relationships. The need for certainty in international trade requires, while respecting national identities, a uniform framework beyond the domestic level. Uniformity, however, cannot always be achieved by means of the same substantive rules for cross-border relationships; for this reason, the book devotes particular attention to rules of private international law of supranational origin. The work overcomes the ‘barriers’ between legal disciplines through a study of the different ways in which civil relationships are regulated by international and European Union law, including private international law.
Further information can be found on the publisher’s website.