Jean Monnet
Lifelong Learning Programme
‘Cross-Border Litigation in
Belgium and Sweden’
Workshop Report No 6
6th – 7th June 2013
"This project has been funded with support from the European Commission. This
publication reflects the views only of the authors, and the Commission cannot be held
responsible for any use which may be made of the information contained therein."
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BACKGROUND
On 6th June 2013, practitioners and academics connected with the Centre for
Private International Law met at the sixth of seven workshops dedicated to
promoting the debate on how cross-border litigation functions within Europe.
The purpose of the workshop was to offer the opportunity for a free and frank
exchange of ideas surrounding the Belgian and Swedish perspectives on EU
private international law.
This report intends to provide a brief overview of the ideas that
emerged from the workshop without attributing any views to any particular
individual.
Cross-Border Litigation in Family Matters
Jurisdiction and Recognition and Enforcement in Family Matters
Brussels IIbis
The Belgian Experience
The issues surrounding the definition of marriage, of habitual residence, dual
nationality, and prorogation of jurisdiction and transfer of proceedings were
highlighted for discussion. The first point raised concerned the definition of
marriage. It was noted that Brussels IIbis applies to divorce. Divorce implies
that the people were originally married. Marriage is not defined in the
Regulation. In Belgium we have marriage for people of the same gender. If
you come from a country that only has civil partnership for same sex couples
then Belgium will transform the civil partnership status to one of marriage.
Marriage should be given an autonomous interpretation and therefore it is
argued that divorces of same sex couples should fall under the Brussels IIbis
Regulation. So far there has been no case law on this issue as it is assumed
that people in this situation return to the state of origin.
The ECJ in A and Mercredi defined habitual residence for children and
in other cases involving social security. But the question remains as to how
we translate those cases for habitual residence for adults and for spouses. To
what extent do we take into account the objective elements and intention
element? In one case M was domiciled in Belgium, he was not a national. He
lived in Indonesia for less than a year. The question was, was he still
habitually resident in Belgium when he was in Indonesia, for the purpose of
divorce. He was habitually resident in Belgium as he paid tax there – and he
had the intention to return there.
With regards to the dual nationality, Belgium is part of the Hague
Convention 1930 and the question is to what extent can we use that
convention when we are using EU law? It would appear from Belgian case
law that the courts prefer to choose the common nationality. In a case
concerning matrimonial property from the Court of Cassation 4 December
2009 one spouse had dual nationality of Belgium and Morocco and the other
spouse was Moroccan. The question was which law would apply to the
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divorce? The courts chose the common nationality. However if the courts
were to consider Brussels IIbis and a couple with two European nationalities
for example a common nationality of Belgium and one with a dual nationality
of France, it is argued that the courts would not be able to ignore the second
nationality. It is important for art 3. The court has to work out if it has
jurisdiction and it also has to see if another EU court has jurisdiction.
A Dutch case was then put forward initially as a good example of
forum necessitatis. Forum necessitatis will be considered in the review of
Brussels IIbis. The Court of appeal of The Hague, 21 Dec 2005 heard the case.
At the time the Maltese court was the only court in EU with jurisdiction. The
problem was that divorce was not possible in Malta (at the time). The courts
used the Dutch forum necessitatis. A couple living in Malta before Malta
allowed divorce. The husband was a Maltese national and the wife was
Dutch. They were living in Malta and they wanted a divorce. They put
forward joint proceedings for divorce. No ground for jurisdiction only one
party with Dutch nationality. None of the parties live in the Netherlands. If
the wife came to live in the Netherlands for 6 months then the Dutch courts
would have jurisdiction. The Dutch court said that they didn’t have
jurisdiction so looked to see if another state had jurisdiction. Malta did but
Malta wouldn’t grant a divorce. The couple have to have a forum. The couple
needed to have access to justice. So forum necessitatis was put forward and the
Dutch court relied on it. This problem doesn’t apply any more as Malta
allows divorce.
However this case was heavily criticised by the group as being
unlawful as it was merely trying to get an end result. It was a violation of
Brussels IIbis. There was a court within the EU that had jurisdiction. The fact
that it didn’t permit divorce was irrelevant.
The habitual residence of the child under article 8 was discussed. The
Court of Appeal of Ghent, 26 May 2010 heard a divorce action. The parties
were silent on jurisdiction and applicable law. The courts said that the
children were habitually resident in Belgium, basing their reasoning on art 8
and therefore the Belgian courts had jurisdiction even though one of the
parties was not a Belgian national.
In another divorce case concerning prorogation of jurisdiction the
Court of Appeal of Brussels, 29 June 2009 heard a case where the parents had
lived in Belgium but had then moved to the Congo. The children were
habitually resident in the Congo. Both parties had accepted the Belgian
courts. But there is also a best interest of the child question to be considered. If
the child is habitually resident in a country not party to Hague Convention
1996 then it is presumed to be in the interest of the child. But Belgium isn’t
actually party to this convention.
National legislation on child abduction has been amended and is
viewed as more efficient. There are only five courts that can deal with child
abduction, which has the benefit of focusing the expertise. But there are also
controversial aspects. In Belgium the Public prosecutor institutes return
proceedings. But when there is a risk of violence then the public prosecutor
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would be in a difficult position due to possible conflicts of interest and they
would suggest a lawyer should do that role. Not sure if child abduction cases
are being dealt with more quickly.
For a case concerning transfer of proceedings at the Court of Appeal of
Antwerp, 23 Dec 2011 & 15 June 2011, at the start of proceedings the mother
and daughter lived in Belgium and the court had jurisdiction under art 8 of
Brussels IIbis. By the time of appeal: the mother and child had moved to the
Netherlands and there was a transfer of jurisdiction. The mother requested
transfer (which was agreed by the other parties). The father lived in the US.
There was a risk of violence. The mother said that the child was 4 years old
when her mother took her and the child was settled in the Netherlands. The
court would not take this into account. Their view was that the child should
be returned to the US. The case went to appeal to the ECHR. The ECHR said
that they had to take into account what had happened in the mean time. The
court said the judge should have looked at the best interests of the child,
which is not possible under the Child Abduction Convention.
The Swedish Experience
Background
A brief background to the Swedish court system relating to family matters
and Brussels IIbis was provided for the group. In Sweden most of the cases
concerning children that fall within the scope of Brussels IIbis start in a district
court, which is a court of first instance. If a party is dissatisfied with a decision
made by the district court, the party can appeal, but a court of appeal can only
give the party a full review appeal after the court has granted leave to appeal.
At present Sweden has 48 district courts and six courts of appeal. All districts
courts and all the courts of appeal deal with matters related to family law.
Only one district court, the Stockholm City Court and the Svea Court of
Appeal deal with matters related to the 1980 Hague Convention and the
return of wrongfully removed children. The Supreme Court is the court of last
instance. The primary responsibility of the Supreme Court is to try cases,
which may be of interest from the point of view of the development of law,
that is, to create precedents and a party needs a leave to appeal if the case is to
be given a full review.
Four years ago Sweden reformed its court procedure. It was entitled
"More Modern Court Proceedings". One new measure was to introduce video
recordings of all examinations of witnesses, parties and experts in the firstinstance proceedings before the district courts. The video can then be played
in any proceedings before the Court of Appeal and the Supreme Court, so
that the person concerned need not come and be heard a second time. Where
necessary in a certain situation, however, a fresh examination will take place
before the Court of Appeal. This new procedure also applies to parties and
witnesses in cases concerning family matters and so far the experience of the
new regime has been very positive. An advantage is that the reform helps to
shorten the processing time in the court of appeal.
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Brussels IIbis and the impact on Swedish legislation and case law
Jurisdiction
It was noted that prior to Brussels IIbis there were just a few generally
applicable international private law rules in the Swedish national legislation
in this area. Brussels IIbis gave Sweden legislation both on jurisdiction and on
recognition and enforcement. This led to clarification and help for courts and
practitioners, even though the Regulation was not very easy to apply. For
instance, the child’s habitual residence can be very hard to determine.
However, it was recognised that most of the general courts in Sweden are
now aware of the decision by Court of Justice of the European Union in the
case Mercredi v. Chaffe (C-497/10 PPU), where the court interpreted the
concept of a child’s habitual residence for the purposes of Articles 8 and 10 in
the Brussels IIbis.
At the time Brussels IIbis came into force, it was suggested that many
practitioners did not realise that the Regulation was applicable in respect of a
child that is a citizen in a non-EU member state, e.g. in the US. In a judgment
by the Swedish Supreme Court in 2011 where the question was whether
Swedish courts have jurisdiction or not, the court stated that the question as
to whether a child has its habitual residence in Sweden shall be determined
according to the articles in Brussels IIbis even though there was no connection
in the case to another EU-member state. (NJA 2011 s. 499)
Recognition and Enforcement
Sweden does not recognise and enforce foreign judgments without a legal
base in legislation. As the Regulation points to many decisions that can be
recognized and enforced it was noted that Brussels IIbis extends the area
where measures taken abroad are to be recognised and enforced.
Sweden has passed an Act with complementary rules to the Brussels
IIbis Regulation, which includes rules for the procedure of recognition and
enforcement. Only one court is appointed to deal with this procedure. One
judge decides the case in the first step of the procedure. A party that is
dissatisfied can ask for a review of the decision and in case of a review the
court consists of three judges. The judge who has considered the question in
the first place cannot participate in the second step. A decision according to
the second step can be the subject for an appeal. Leave to appeal has to be
granted by the Supreme Court for a full review of the case. Figures regarding
how many applications according to Brussels IIbis that are filed to the court of
appeal were not available but it was suggested that they were not very
frequent. If the court grants enforceability, the decision can be enforced in the
same way as for a similar Swedish decision. It is then possible to impose a
conditional fine or assistance by the police to secure the enforcement.
Return of a child that has been wrongfully removed
The Stockholm City Court, the only district court dealing with these cases,
received approximately 22 applications last year. In four cases the parties
settled their dispute. In half of the cases the court approved the application.
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The same year, the Svea court of appeal, received 15 appeals and in
most of these cases the district court had refused the application. In 9 of the
cases (that is half of them) the appeal led to a return order. The ground for
refusal in the other cases did not concern the grave risk of harm to the child
(article 13 b). None of these cases were granted leave to appeal by the
Supreme Court.
However, the Supreme Court has tried a couple of cases on this matter
in the last few years. The first of these cases, a decision from 2008, concerned
procedural matters related to 1980 Hague Convention cases. Even though the
case does not concern a return to an EU member state the case is of interest
here. The background was as follows. (NJA 2008 s. 963)
The application for return concerned a ten year old boy. When he was
born his parents, who then were married, lived in Sweden. When the boy was
six years old the mother moved to Croatia and brought the son. The year 2004
the father filed an application for return of the child in Croatia. This
application was refused in 2006 because it had been established that there was
a grave risk that the child’s return would expose him to physical or
psychological harm. Meanwhile, a Swedish court had in 2005 granted the
father alone the custody of the boy. In the year 2007 a court in Croatia
entrusted the custody to the mother alone. During Christmas 2007 the father
visited his son in Croatia and then brought the boy to Sweden. The mother
then filed an application in Sweden for the boy’s return.
The district court held a hearing and heard the parties and some
witnesses. The district court found that the boy had habitual residence in
Croatia at the time of the travel to Sweden after Christmas 2007, that the
removal was wrongful, that there were no obstacles for a return according to
the boy’s health and that the boy was too young to take account of his views.
The application therefore was approved. The court of appeal was of the same
opinion and so was the Supreme Court.
According to the Supreme Court judgment these cases are of a
summary character and should be handled speedily. As a main rule, a party
has a right to a hearing if he or she asks for it. There is normally less actual
need for an oral hearing in a case concerning return of a wrongfully removed
child. But the court must pay regard to article 6 in the European Convention
on Human Rights and a party’s right to a hearing. In the present case there
had been a hearing in the district court and there was, according to the
Supreme Court, no need for another one in the court of appeal. It is up to the
court to decide whether it has enough information about the child’s
circumstances and a request from one of the parties for more information, for
instance from social authorities, must be considered with regard to the
demand of speed and the summary character of the case. When a child
against the custody holder’s wish is moved from one country to another, the
child normally does not get a new habitual residence. However, exceptions
can be made if the child has stayed in the new country during a longer time
period and under such conditions that it has acquired a permanent
connection to that state.
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The second case from the Supreme Court is a case from 2012 (NJA 2012
s. 269). In this case also the court of appeal’s decision is of a certain interest.
The circumstances were as follows.
The application for return concerned two children, 9 and 7 years old.
Their parents were married before and had lived together in Germany and
Czech. The children were citizens of the Czech Republic. When the parents
divorced they agreed that the mother should take care of the children and the
agreement was affirmed in a judgment by a court in Czech in March 2010. In
May the same year the mother moved to Sweden and the children lived with
her since the middle of August that year and went to school in Sweden.
The father filed an application for a return order at the district court
but the district court refused the application. Then the father appealed. The
father said in his appeal that the parents had an agreement that the children
would stay in Sweden with the mother for one year only and then return to
Czech for the next year in school. The mother denied such an agreement and
asserted instead that the agreement was that the children would stay with her
for one year and that the agreement then only was that they would evaluate if
the children felt themselves at home. The court of appeal found proven that
the agreement was what the father had asserted. Due to this finding and
while the children still had a strong connection to Czech, the Court of Appeal
found that the children’s habitual residence was not changed, it was still in
Czech. The question for the court was then whether it was a wrongful
retention after the year in Sweden or not. The court had to interpret Czech
law and found that the parents, despite of the agreement that the children
would stay with the mother, still should decide jointly about where the
children would live and, thus, that the mother wrongfully kept the children in
Sweden. The court of appeal didn’t find any other ground to refuse the return
and approved the appeal.
The Supreme Court granted leave to appeal on the mother’s appeal.
The court made the same assessment as the court of appeal regarding the
children’s habitual residence. But during the processing time in the Supreme
Court the mother filed an application for custody at a Czech court and that
court passed an interim decision giving the mother the right to live in Sweden
together with the child pending the final decision. The Swedish Supreme
court placed the Czech decision on the same level as a subsequent
acquiescence and stated that it is a fundamental thought behind both the
Brussels IIa and the 1980 Hague Convention to respect a court decision on
custody made by a court in the state where the child was habitually resident
just before the wrongful removal. The Supreme Court therefore granted the
appeal.
The first judgment from the Supreme Court stressed the importance of
a speedy procedure. According to Article 11(3) the court shall issue its
judgment no later than six weeks after the application is lodged. It was noted
that the district court often uses this time to determine its decision leaving
little to no time for the appeal court process. Concerns were raised that it
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wasn’t possible to meet the time limit in appeal cases although it did mean
that they were dealt with as a priority.
Interestingly it was suggested that Article 11(4) of Brussels IIa could be
helpful in reducing the time it took for the courts to deal with these cases.
According to this article a court cannot refuse the return of a child on the
basis of Article 13b of the 1980 Hague Convention if it is established that
adequate arrangements have been made to secure the protection of the child
after his or her return.
Sweden did not interpret the Regulation as needing to change the
Swedish substantive law due to Article 11(4). Sweden is not used to dealing
with undertakings and mirror-orders but the social services can take certain
measures, although no information could be obtained as to how often these
measures were asked for in Sweden.
Only one recent case in Sweden has been identified where the party
asking for the return of the child, referred to such a guarantee. In that case the
Swedish court did not, primarily, pay attention to the guarantee. The
circumstances in the case were a bit odd. Just before the removal of the child
to Sweden, the social services in the country where the child had his habitual
residence had taken the child into temporary custody. Then the mother
brought the child to Sweden and the social security filed the application for
return of the child. In the application the social services declared that they
guaranteed the child’s safety, according to article 11(4), and that the child
when returned will be given protection and support. The Swedish court,
however, did not treat this statement from the social services as a guarantee
according to article 11(4) but the court anyway found that the child should be
returned. It was pointed out that the article does not provide much guidance
for what demands the court needs to request for the guarantee.
In many cases it is a hard task for the Swedish courts to interpret
foreign law. Many parties would like to provide the court with a judicial
enquiry, for instance an extract from the applicable law and legal statements
from lawyers. This can be time consuming. According to article 15 in the 1980
Hague Convention it is possible for a court, prior to the making of an order to
return of the child, to request that the applicant obtain from the authorities of
the State of habitual residence a decision that the removal or retention was
wrongful. It was noted that no such requests have been made on the basis
that it risks prolonging the proceedings. It was suggested that use of this rule
would be of great help both for the court and for the parties. However
questions were raised at the workshop regarding the lack of information
regarding the nature of article 15 and the danger that it takes too long.
Finally, in a situation when an application on the return of a child is
approved, the court has a possibility to impose a conditional fine or assistance
by the police in order to secure the return. If there is no request by the seeking
party, the court normally initiates it under its own motion because experience
shows that the party that is against a return often won’t co-operate after the
court’s decision has been made.
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Succession
The Belgian Experience
There has been a lot of interest in the new Succession Regulation within
Belgium particularly by estate planners. At first glance Belgium looks well
prepared for the Regulation as the Belgian Code 2004 uses habitual residence
as the connecting factor for succession. There is also the possibility to choose
the law applicable to succession in contrast to other Member States, although
in reality it has rarely been used. However at present habitual residence
doesn’t apply to immovable property outside of Belgium and therefore
Belgium will have to adapt their succession laws and make major changes.
The consequences are difficult to anticipate. An example was provided that
currently if a Belgian dentist retires to sunny Spain but keeps a flat in Belgium
it makes the estate difficult to manage. However, if habitual residence applies
to the whole estate then the consequences for the dentist are easier to
anticipate and the estate will be easier to manage. Spanish law would govern
the immovable property in Belgium.
The consequences for Belgian practice concern the immediate difficulty
in applying foreign succession law to real estate. However it was also noted
that there is a delayed problem within the Regulation when it becomes
necessary to document the traffic of ownership of property by heirs to
immovable property that is sold many years later. For example, the flat in
Brussels is half owned by the dentist’s wife. She dies fifteen years after her
husband and the husband’s share was dealt with under Spanish law.
The choice of law is possible in the Regulation, art 22, but has greater
weight than the current Belgian law. The choice of law found in art 79 of the
Code is not guaranteed recognition by other Member States. Indeed it is
possible for the choice of law rule to be displaced by forum shopping. Under
the current Belgian law even if the Belgian courts have jurisdiction there is an
express reservation for the mandatory reserved share.
The Swedish Experience
Focus was placed in the potential problems in adopting the Succession
Regulation 2015 within Sweden. Background was provided as to the current
succession legislation within Sweden, the IDL 1937 and the NDL I-III 1935
and discussion took place as to whether it should be abolished or amended.
Rules on jurisdiction in Sweden differentiate between litigation and
devolution of estates. Devolution of estates is a procedural matter in Sweden.
Swedish rules on devolution of estates deal with - when is an estate devolved
according to Swedish procedure and if so do we have universal jurisdiction or
a territorial jurisdiction? That is regulated separately as opposed to litigation.
We would assume jurisdiction in both devolution and litigation cases if it is a
Swedish national regardless of the fact that the deceased may not live in
Sweden. If the deceased has habitual residence and if there are assets in
Sweden then Sweden will have universal jurisdiction. If there are only assets
then it will be territorial jurisdiction.
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Sweden still adheres to nationality. However the 1937 law would have
been amended if there hadn’t been the forthcoming Succession Regulation
and Sweden would have moved to the use of habitual residence. There are
detailed rules for estates and specific types of land in other countries, also for
the applicable law to the will, who has the right to inherit and finally the law
on the specific choice of law for debts. This will be replaced by the legislation.
With regards to recognition and enforcement under Swedish law – if
you are in a non-Scandinavian situation then Sweden is extremely reluctant to
do this and will not recognise and enforce a foreign judgment if the estate
should have been devolved in Sweden under Swedish rules, which are
habitual residence or nationality or assets located in Sweden. The only
foreseeable case for recognising a foreign judgment is if the assets have been
transferred to Sweden after the death of the deceased.
A lot of work has to be done to make Swedish legislation compatible
with the new Succession Regulation. A committee was set up in November
2012 to last until April 2014. It comprises of a chair, secretary and 7 experts;
academics, representative from banks, tax lawyers and practitioners. Their
task is to consider the implementation of the Succession Regulation, whether
to ratify the Nordic convention (which has already been politically affirmed)
and to come up with the necessary amendments to Swedish Succession Law.
It will review the powers of the administrator and liquidator (the liquidator in
Swedish law distributes the estate). The administration and distribution of
estates are handled separately. The liquidator would be considered to be a
court under the Succession Regulation.
Regarding the jurisdiction of the habitual residence of heirs making
declarations of waivers of inheritance (art 13 of the Regulation) this does not
exist in Swedish law and therefore implementing measures need to be put in
place. Sweden is a 1961 Hague Formal Validity of Wills Convention country
and a dualist country. Article 75(1) of the Regulation allows Sweden to
continue to apply that Convention. It cannot just repeal the 1937 act as it
needs some legislation to say that it is still bound by the 1961 Hague
Convention.
Estates without a claimant (art 33 of the Regulation) – if Swedish law is
applicable the crown inherits. Some countries have ius regalia where a state
body may take control of any assets in their territory.
At present Sweden has a rule in the pil 1937 act saying that if the estate
is distributed in Sweden and other assets in other countries don’t have a
reserved portion – Swedish law compensates for this eg if the deceased gave
everything to his new wife the persons entitled to a reserved share can be
given a larger part of the assets in Sweden to compensate for assets in
England not going to those entitled to a reserved share. From the Swedish
perspective this is a private international law issue (it is characterised as a
substantive law issue in Germany) so Sweden could make it a substantive
rule under Swedish law to guarantee the reserved portions.
A comment was made that just because England doesn’t have reserved
shares it doesn’t mean that there aren’t systems to provide for dependents
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who are not provided for by the deceased in his will and the concern is that
you might over compensate some dependents.
Problems of scope of applicable law – things seen as procedural – the
estate under Swedish law is a legal person – it was pointed out that some
countries would not see it like this in that legal persons would be treated as a
matter of company law.
It was suggested that art 29 of the Regulation on the appointment and
powers of administrators is a mess. Sweden has administrators and
liquidators and art 29 says what they can do. Careful implementing
legislation will be required to try to reduce the uncertainty of the application
of art 29 in Sweden.
There is a rule in Swedish law that whoever is looking after the
property should look after it. If foreign law is to govern the estate we assume
that they would have similar rules but we don’t know that. At times
determining which law is applicable takes time.
Foreign applicable laws sometimes utilise notaries but Sweden doesn’t
have the same thing so who is going to fulfil the tasks of the notaries? No
solution as yet.
With regards to recognition and enforcement the Regulation only deals
with recognition from Member States so still need national laws on
recognition of succession matters from third countries so should Sweden use
the old rules? No it needs new rules.
Recognition of a Swedish administrator’s decision needs to be
recognisable in the EU as the rules are now drafted.
Finally the decision needed for the certificate would best be done by
the tax authority, as they are obliged to receive a record and no domestic rules
currently exist for a certificate.
Finally it was noted that people are permitted to choose the applicable
law to govern their succession in their wills (art 22). However they can only
choose the law of their nationality. This was regarded by the group as too
limited.
Cross-Border Litigation in Civil and Commercial Matters: Jurisdiction and
Recognition and Enforcement
Brussels I
The Belgian Experience
An example of exclusive jurisdiction was put forward. The case concerned the
transfer of a property in France to the wife during divorce. The husband
needed to organise a document to say that it was properly transferred. The
court said that matrimonial property didn’t fall under art 22.
At the Court of Appeal of Ghent, 3 June 2009 a case was heard
involving contracts. Three invoices had been made in the same contract,
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which would amount to regular business relations. However it was
considered that the fact that a party did not react did not amount to
acceptance of general conditions. The fourth invoice was in dispute. The court
said that just because the parties didn’t react doesn’t mean that they accepted
jurisdiction. The question here is how many invoices amount to a regular
business relationship?
It was pointed out that in Sweden there would be a difference between
common practice and regular business practice. Difficult to say if something is
a regular business practice if it is not your usual business practice. It was also
submitted that the parties had evidently orally agreed to the conditions, as
there was no written evidence. In the recast the substantive and formal
validity is separated.
On the 1st February 2012 the Court of Appeal of Ghent heard a case
involving a language dispute. The contract was in German but the clause was
in Dutch. The recipient did not understand Dutch. Therefore it was not a
valid forum clause.
On the 1st March 2013 the Court of appeal of Brussels, heard a case to
work out where reimbursement should take place. To work out the
jurisdiction need to look at place of performance of the obligation underlying
the proceedings. The place where the initial obligation arose is irrelevant
under an art 5(1)(a) situation.
On the 22nd June 2012 the Court of Cassation heard a case concerning
refusal on the ground of public policy. In this case it was held that the
enforcing judge couldn’t suspend proceedings for declaration of
enforceability because of pending criminal proceedings. Finally on the 29th
April 2010 it was held that the court couldn’t refuse enforcement on the basis
that a foreign judgment contravenes EU law. A violation of EU law doesn’t
stop the enforcement.
The Swedish Experience
An analysis of the exequatur procedure at the Svea Court of Appeal was put
forward. It was noted that the Svea Court of Appeal is the exclusive forum for
exequatur procedure under almost all international instruments requiring this
procedure. All 8 divisions deal with the exequatur cases. A decision according
to article 41 is handled by a single judge. The decision after an appeal acc. to
article 43 is taken by three judges. The case is handled in another division
than the one where the first decision was taken. This decision can be appealed
against according to ordinary national rules.
The number of exequatur cases in the area ”civil and commercial
matters” was 366 in 2012. 138 cases were made under the Lugano Convention
(mostly Norwegian judgments). An appeal within the appeal court according
to article 43 was made in as few as 26 cases. An additional number of 100
cases related to the Brussels II Regulation or other family law matters. It was
stated that the issues that Sweden faces in the exequatur procedure are often
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of a practical nature. Situations not addressed in the Regulation can also raise
questions. An example: an applicant wants to have a declaration of
enforceability against a deceased person.
With regards to the liability for costs there are two precedents from the
Supreme Court. The court has stated that there is no liability for costs in the
procedure according to article 41. The applicant has to bear his/her own
costs. This might be considered self-evident since it is a one party-procedure,
in which the court cannot/shall not communicate the application with the
other party. In the procedure according to article 43, there is a liability for
costs according to the rules applicable to procedures in general, where the
main rule is that a party who looses a case has to pay for the other party’s
costs. (Case NJA 2009 s. 632, decision 22 October 2009)
A question was raised as to how Sweden should deal with costs in a
case where an application for a declaration of enforceability is made with
regard to a judgment that still can be appealed against or where there is an
appeal not decided on, and where the judgment is revoked in the country of
origin? The Svea Court of Appeal decided that the parties should bear their
own costs. The applicant could not foresee this outcome in the country of
origin and should therefore not pay for the other party’s costs even though
the application was denied. The Supreme Court decided that the applicant
should cover the costs of the other party. The Supreme Court said that the fact
that the judgment could be revoked was something the applicant should
foresee as possible. (Case NJA 2006 s. 652, decision 15 December 2006)
A practical issue for the courts concerns translation. The Supreme
Court has decided what is the consequence when an applicant does not
provide a translation of the judgment and the certificate according to article
55.2. According to article 55.2, a translation shall be produced if the
court/authority so requires. The Supreme Court found that the necessity of a
translation should be considered according to national rules. The national rule
states that documents should be in Swedish, but other languages can be
accepted. For example documents presented as evidence can be accepted
without translation if they are in Danish or Norwegian, and often also when
they are in English. Other languages are not normally accepted.
In this case, the judgment and the certificate were in German. The
applicant declared that it was too expensive to translate the documents,
taking into account the amount of money the other party should pay
according to the judgment. The Supreme Court did not find this argument
valid and saw no reason to deviate from the main rule. The application was
denied.
Committee for the new Brussels I Regulation
The new Committee has the task to propose necessary complementing
legislation especially with regard to the new system where the exequatur is
abolished and on article 54 on adapting measures not known in the Member
State addressed.
13
In addition the committee has the task to review the current exequatur
legislation under the Brussels I regime as well as under other instruments
(Brussels II, Lugano, several Hague conventions etc); the idea is to move the
exequatur from Svea Court of Appeal to the district court level.
The Enforcement Service that deals with the procedure for enforcement
of judgments in Sweden is a state authority. It seems natural to let the
Enforcement Service also deal with judgments from other MS under the new
Brussels I. In this procedure the other party can, according to national rules,
invoke grounds not to enforce the judgment: such grounds could be: payment
is made or period of limitation has expired. Decisions by the Enforcement
Service can be appealed against to a number of District Courts.
A court can only try the grounds of refusal according to the Regulation.
There is therefore no possibility to have these grounds tried in the same
procedure. The task for the Committee is to make the system as user friendly
as possible and to avoid objections being improperly handled. How could
Sweden do this? A system of communication between court and Enforcement
Service and, if possible, by making sure that the courts dealing with the
regulation cases are the same as the ones dealing with enforcement cases.
As mentioned, the exequatur procedure today takes place at Svea
Court of Appeal. It was suggested that this was a bit odd, since the Swedish
court structure (the general court system) has three instances; district courts
(48), courts of appeal (6) and the Supreme Court and a principle saying that
all cases should start in the district court level and that the exceptions from
this principle should be few: international obligations, cases requiring special
knowledge or especially speedy procedure.
The committee will consider if it is possible to move the exequatur
according to all instruments that require this procedure to the district courts;
i.e. to the first instances in our court system. Three alternatives have been
identified; to one district court, to all district courts, to some of the district
courts. However questions were raised as to whether these courts had enough
knowledge of international matters, which courts would deal with the
Enforcement Services cases when they are appealed against and whether they
should follow guiding principles laid down by the Parliament on court/case
structure.
Case-law on jurisdiction
It was noted that there had been very few Swedish cases on matters under the
Brussels I Regulation, approximately 30-40 since 2001. Many cases applied the
Lugano Convention or the Brussels Convention and most cases concerned
relations with Denmark, Norway or Finland.
Many cases deal with article 5, 5(1) or 5(3). It was highlighted that the
courts are doing their best with these cases, they are very thorough, they refer
to ECJ case law, national case law and doctrine. It was also noted that the
courts were eager to clearly state that the jurisdiction issue is decided on the
basis of the doctrine of assertion; the court accepts the facts asserted by the
plaintiff unless they are clearly unfounded.
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Two cases from two courts of appeal were put forward as illustrations:
Case RH 2010:23 (judgment 17 December 2009)
The Swedish company Ö instituted proceedings against two foreign
companies - BS and SB - asking for a negative declaratory judgment. These
two companies had instituted arbitration proceedings against Ö on the same
matter claiming that Ö had entered as a party into an agreement - a shipping
agreement - between BS and SB on the one side and S on the other, or that Ö
was the real party to the agreement. There was a breach of the contract due to
lack of payment. Ö was the owner or the mother company of S.
Ö:s claim/action for a negative declaratory judgment:
- Ö is not liable towards SB/BS under the shipping agreement
- Ö is not bound by the arbitration clause in the shipping agreement.
The district court found that Swedish courts did not have jurisdiction
according to the Brussels I Regulation. It then went to the Court of Appeal.
The questions that were asked were - Is article 5(1) applicable? Is the action a
matter relating to a contract?
The Court of Appeal held that article 5(1) is not applicable unless it is a
situation where the alleged parties to the contract have undertaken the
obligation voluntarily. In this case the action made by Ö was not entirely
clear, but the Court stated that the action at least in part was not founded on
an assertion that Ö had voluntarily entered into the shipping agreement, but
rather that Ö on the basis of company legislation should be held liable to the
obligations under the contract. The court also stated that the fact that the
action was based on a negative assertion, claiming that a contract with Ö as a
party does not exist, did not change the way the jurisdiction issue should be
judged.
In part the action was deemed to be a matter relating to contract. The
court therefore had to deal with the task of establishing the place of
performance of the obligation in question; the contract was a shipping
contract and therefore a case of provision of services, the services under the
contract were to be performed all over Europe, no one of these places could
be deemed to have any connection with the dispute. Article 5(1)(b) was
therefore not applicable.
An application of 5(1)(a). would lead to the place of payment (the
alleged breach of the contract was lack of payment) which was not in Sweden.
Swedish courts had no jurisdiction according to article 5(1). Finally the court
found that article 5(3) was not applicable to the part of the action concerning
liability under company law; although the concept tort, delict and quasi delict
should be interpreted widely, there is room to find that neither article 5(1) nor
5(3) is applicable.
In the Case RH 2012:64 (judgment 10 October 2012) the company B
instituted an action against MK – domiciled in Germany – at the district court
in Helsingborg and claimed payment for goods bought by the company
Rapid. MK was a former member of the board in Rapid and he was according
to B personally responsible for the payment due to the rules in the Swedish
company act. B invoked article 5(1) in the Brussels I Regulation. The goods
15
were delivered in Helsingborg. MK claimed that Swedish courts had no
jurisdiction over the dispute. He had not entered into any agreement. The
question was if this is a matter relating to a contract as stated in article 5.
The district court as well as the court of appeal found that article 5(1)
was not applicable. In this case MK had not personally made any
undertakings/commitments, his liability was dependent on company law and
the conditions laid down in that legislation, these conditions were not
contractual. The court dealt with the applicability of article 5(3). It found that
article 5(3) was not applicable, and put forward three arguments that there
should be restrictive application of the exceptions to article 2, that article 5(1)
and 5(3) do not cover the whole field as there is room to find that neither of
them can be applied, and in matters concerning payments under the law of
associations this can often be the case.
Choice of Law in Obligations
Rome I and II
The Belgian Experience
Case law in private international law issues is sparse in Belgium. There are no
cases on Rome I and only 2 on Rome II. To put this into context, the Belgian
Code on PIL was enacted in July 2004 and entered into force on the 1 st of
October 2004. The idea was to provide a comprehensive set of rules for any
issues on PIL that might be raised in Belgium. This implies that the Belgian
courts should always find the answer to any question in the Code. It is also
conceived as a MAP for practitioners. The law had to provide for rules on
any issues, including the law applicable to contract and torts and any other
issues on which Belgium now has EU Regulations.
However the result is that any regulation on PIL enacted by the EU
comes into conflict with the Code. That conflict is of course easily solved by
way of precedence. This leaves two issues: the first is as both Rome I and II
are universal they replace the Code in every subject matter they deal with.
Therefore the PIL Code no longer has any purpose on issues dealt with by
universal Regulations such as Rome I, Rome II and the Regulation on
Succession. So the question asked was should the corresponding provisions
be simply deleted? The second issue concerns the map function for
practitioners. How are the practitioners to know that they need to refer to the
new EU instruments? It was felt that practitioners needed guidance and that
deleting the provisions with the code would have simply left a ‘black hole’.
Therefore, the Ministry of Justice decided to adapt the Code in regard to
Rome I/Rome II, although work has yet to start on this.
The factor that links the Code and Rome I is the Rome Convention. The
Rome Convention was in force at the time when the Code was enacted and
therefore the drafters took it into account. The drafters were faced with 2
questions. The first concerned whether conflict of law rules for contracts were
necessary at all. The second concerned how to deal with issues excluded from
16
the material scope of the Rome convention (such as jurisdiction clause or
arbitration agreements). For the issues covered by the Rome Convention, as
well as for issues placed outside the scope of the Rome Convention, the
decision was to follow the Convention. With regards the issues covered by
the Rome Convention Art 98(1) reads as follows; “The law applicable to
contractual obligations is determined by the Convention on the law
applicable to contractual obligations concluded in Rome on 19 June 1980.”
This provides purely directions for the practitioner. It lacks normative
content.
For issues not covered by the Rome Convention, it was decided to use
rules that had already been formulated rather than take the time to formulate
new ones.
Art. 98(1) concerning the law applicable to the contractual obligations reads
‘(…) Except in the cases otherwise provided for by law, the contractual obligations
which are excluded from the scope of application of that Convention are
governed by the law that is applicable by virtue of the articles 3 until 14
thereof.”
This rule leads to an extension of the scope of the Rome Convention.
Or more precisely, it is an absorption of the Rome convention into a domestic
statute, but it is simply made by a reference to the Rome Convention. Issues
excluded from the scope of the Rome Convention should be dealt with by
domestic rules on PIL. The Rome Convention dictates the content of the
domestic rules for PIL. It is similar to what has been done in Germany where
the EGBG contains a copy of the Rome Convention.
This extension/absorption is limited because on many issues excluded
from the Rome Convention, the code of PIL does propose specific
rules concerning succession and wills, maintenance, trust etc.
Discussion turned to the current issues for Belgium, essentially how
does the past influence the present and how do we go forward after Rome I?
The solution is partially provided for by Rome I itself, as article 24(2) states
that any reference made to the Rome Convention is to be understood as a
reference to the Rome Convention. Within the scope covered by Rome I, a
reference to the Convention is a reference to Rome I. This means that art.
98(1) of the Code just needs to be read as a reference to Rome I for all
contracts concluded after the entry into force of Rome I (17 January 2009).
However things are more complicated for the extension/absorption
rule art. 98(1) second indent is not a mere reminder rule; it does carry a
normative content. This is actually a domestic conflict rule whose content is
‘copied’ from the Rome Convention. If we were to replace by a reference to
Rome I, for all contracts signed after January 2009, we would impose on
parties a new rule that would apply retrospectively! As the Belgian Law is
adapting the Code…with a certain delay, the only solution is to apply the new
“extension/absorption rule” to contracts signed after the entry into force of
the new law (10 days after publication in the official journal of the amending
law)
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Discussion then turned to the Belgian PIL Code and Rome II. It was
noted that although there was no history for Rome II that didn’t mean that
Belgium didn’t have a relevant history. In Belgium the Hague Convention
on traffic accidents (1971): another one of our specificities applies: car
accidents do not fall within the scope of Rome II in front of Belgian courts but
are determined by the Hague Convention and the solutions are partially
diverging. Belgium has a full set of extra contractual obligations found within
art 99 – 108 of the Code. So should Belgium keep these existing provisions?
For issues covered by Rome II then the reminder rule (art. 98(1) the idea is to
preserve the role of the Code as a map. For issues from Rome II, this is a bit
more difficult, because on the one hand, matters excluded from Rome II, like
privacy and personality rights, were excluded for a good reason: the absence
of political agreement, and the idea that the solutions were not fitting the
issues raised in regard to these subject matters. On the other hand it was put
forward that Belgium already has well-functioning rules. Therefore the
provisions within the PIL Code were kept as they were.
In conclusion the reminder rule is there to provide direction in a PIL
map. This is necessary for all universal instruments. But the next question for
Belgium is how should they deal with semi universal instruments such as
succession and the Brussels I Recast?
The Swedish Experience
It was noted that there are very few judgments in this area in Sweden.
The Swedish choice of law rules were then discussed. The choice of law
in contract is governed by the 1955 Hague Convention. The principle of party
autonomy is used. The proper law is the law with the strongest and most
significant connection.
Choice of law in tort is governed by the lex loci delicti. This is a strict
rule.
In AD 2004 n 45, a case concerning a wrongful termination the
applicable law was sought for an employment contract. It concerned a
Swedish employer with a British representative. She didn’t turn up for work.
As a British citizen her place of employment was UK. However the place of
performance and residence was Russia and therefore Russian law applied.
The choice of law in contract was discussed in AD 2007 nr 2. The
question concerned the validity of international collective labour agreements
with a Swedish choice of law clause. The ITF campaigns against flags of
convenience. The case concerned a Cypriot owner, a Bosnian flag, Greek
operation, Polish and Filipino crew. The Rome Convention was applicable but
the labour court forgot to apply it!
The NJA 1987 p888 the Nervia Case there was no explicit reference to
putative applicable law. It was decided that there was no reason to determine
whether ‘blacklisting’ constituted unlawful duress under the law.
The labour court test of validity is therefore a factual appropriateness
test of actual consent. The question of consent is substantive validity. No
18
reference to any foreign law and therefore Swedish law will apply. It is either
the lex contractus or the lex fori.
The Sara Star 2002 n 39 was another case concerning the flag of
convenience. The industrial action was legal under Swedish Law. The
blocking could not mean that there was a lack of party will.
AD 1992 n 10 and AD n 2007 n 2 – Swedish labour law governs the
validity of a contract rather than the general contract law. In an industrial
action this has the effect that both parties are deemed to have consented to
both the collective labour agreements and the Swedish Choice of law clauses.
Voluntary consent replaced by deemed consent under the law relating to
industrial action. A criticism of this approach was that everything concerns
consent yet Art 8(2) is left out of the equation. It is unpredictable. Should have
specifically negotiated the Swedish choice of law clause to create an informed
choice of performance flag. The flag of convenience is not a defined concept.
With regards to the choice of law under the Rome Convention cases
were put forward as illustrations. AD 2004 n 15 the applicable law to an
employment contract was discussed under art 6(2)(a) of the Rome
Convention. It concerned a Danish Employer and a Swedish Employee with a
6-month employment contract working 80% of the time in Sweden. The work
was to develop to be 50:50 but the employee terminated the contract before
this began. It was decided that it was the actual period of employment that
must be taken into account.
AD 2010 n67 concerned the applicable law of the employment contract
under art 6(2)(a)(b) of the Rome Convention. It involved a Swedish Employer
and a German employee who was a truck driver. Work was carried out in
many EU countries. Notice of termination of employment was in pigeonhole
in Swedish office. The employee was stationed in Sweden but the country of
performance could not be established.
AD n95 concerned an interim decision re permissibility of annulled
industrial action preventing new employment and the question was whether
this was in the scope of Rome II. The Swedish law was undecided.
Collective Redress, Competition and Intellectual Property – Do they need a
specialised regime?
The Belgian Experience
It was noted that there is very little case law for collective redress or
competition in Belgium but a vast amount on intellectual property where the
majority of cases concern jurisdiction with a few on recognition and
enforcement.
However following the example of other Member States, including the
Netherlands, Portugal, Germany but also the UK, Belgium will most probably
and very shortly adopt a specific statutory scheme to deal with collective
redress. As it stands there are three different kinds of model of collective
redress proceedings; the ‘group action’ model, where a number of identified
19
claimants bring action in one procedure to enforce their claims together, the
‘representative action’ model, where an ex ante authorized or representative
body bring actions on behalf of a group of individuals, who are not as such
parties to the proceedings though they may be bound by the outcome and the
‘class action’ model, where a plaintiff acts on behalf of a group of individuals
who will be bound by the outcome of the procedure. For these two latter basic
models, there is a distinction between the ‘opt in’ system, which is used in
most Member States that have introduced a collective redress mechanism,
and the opt out system, where absent members are bound by the outcome of
the case (the US model, which is much more controversial).
The draft Belgian Act (in its last version issued on 14 May 2013 likely to
be adopted before May 2014) adopts the representative action model; the class
of plaintiffs, which can only be composed of consumers, is represented by a
consumer association which must be certified by a Ministerial decision; there
is a quite sophisticated system of certification of the collective redress actions
by the court, which can lead either to a settlement or to a judgment of the
court (only Court of appeal of Brussels).
As for the choice between the ‘opt in’ system and the ‘opt out’ system,
this is where the private international law aspect becomes relevant. For
consumers who are habitually resident in Belgium, the procedure can be
conducted on an opt out basis: all the consumers habitually resident in
Belgium who have not opted out can benefit from the settlement or the
judgment on the merits. For consumers who are habitually resident outside of
Belgium, the procedure can only be conducted on an ‘opt in’ basis i.e. only the
consumers who have explicitly expressed their willingness to be included in
the class can benefit from the settlement or judgment.
It was noted that this distinction raises some quite delicate issues. First,
from a constitutional standpoint, the question could be asked: is the
distinction between the legal treatment of Belgian consumers and consumers
from the other Member States not equivalent to a discrimination based on
nationality that is prohibited under the Treaty? Secondly it was asked
whether there is a rationale for the distinction from a jurisdictional
standpoint?
Two problems were highlighted regarding the application of the rules
of jurisdiction (Brussels I) that protect the consumers to collective redress
proceedings is highly problematic. The first was that it is doubtful that the
consumer protective rules apply at all to collective redress and the second
that the protective rules are designed specifically to allow the consumer to
bring proceedings at home. Therefore if there are plaintiffs coming from
different Member States, the protection would consist of allowing the
consumers from each Member State to sue at home, leading to parallel
collective redress proceeding involving only the local class of consumers. This
may be the logic beyond the distinction made in the draft Belgian Act.
The existence of parallel collective redress proceedings in different
Member States, each involving only the local class of consumers, seems to
defeat the very purpose of the collective redress scheme, which is the
20
consolidation of the claims of those who have suffered substantially the same
kind of loss for the same kind of illegal activity.
It was put forward that the draft Belgian Act does not deal with the
issue of jurisdiction over the defendant. This was not seen as surprising, as it
is generally accepted today that collective redress actions fall within the scope
of the Brussels I Regulation, though as is well known the rules of this
regulation are not adapted to the procedural peculiarities of collective redress.
A second development regarding collective redress in Belgium directly
concerns an issue of private international law, and this issue has been raised
in an actual dispute and has been the subject of a judicial decision. The issue
is quite classical: it is whether a US class action judgment, based on the ‘opt
out’ model, meets the conditions to be recognised and enforced in Belgium,
under Belgian private international law rules.
As in a number of other recent cases involving other Member States,
the issue has not been decided by a Belgian court, but by an American court.
The certification of a class action under Rule 23(b)(3) in the US needs to satisfy
a number of conditions. One such condition is the ‘superiority requirement’.
Here it must demonstrate that a class action is superior to other available
methods to adjudicate the controversy. This implies that the judgment
resolving the class action must have res judicata and preclusive effects, in the
sense that it precludes the re-litigation of the dispute. When some of the
plaintiffs are foreign, this means that the US court will review whether the
class action judgment will be recognised and enforced in the country of
residence of the plaintiff.
In a recent case that has been decided on 22 February 2013 (Anwar v.
Fairfield Greenwich Ltd), the US District Court for the Southern District of
NY has ruled on the certification of a claim from investors who have been
victims of the Maddoff Ponzy scheme. The investors come from over 70
countries. The class action is brought against investment funds, executives,
auditors and administrators of funds who had placed monies in the Maddoff
company. The Court has ruled on the issue of whether the judgment would
be recognised and enforced in the countries of origin of the investors. As in
the Vivendi case, the Court has embarked on a country-by-country analysis,
and came up with varying solutions in respect of the various Member States
of the European Union. For Germany, France and Luxembourg (amongst
others), the Court found that it was more likely than not that the US class
action judgment would not be recognised as preclusive in these countries.
Whereas for Belgium: the court found, based on the evidence from expert
witness statements, that there is “a general policy that inclines to favour class
action procedures”. The court mentioned the draft Belgian Act would
introduce an opt-out class action procedure. The Court concluded that
Belgian courts would, most likely, not decide that the US class action
judgment would infringe Belgian public policy and the requirements of fair
trial and due process.
It was suggested that the difference in outcome of the analysis between
countries such as France and Luxembourg on the one hand, and Belgium on
21
the other hand, is difficult to justify. The US courts have seemingly failed to
appreciate that the requirements of fair trial and due process are essentially
the same in all the Member States, as they are based on Article 6 ECHR.
Reading this judgment from a US court reinforced for some the sentiment that
it is time to move to some form of harmonisation of the rules about the
recognition and enforcement of third State judgments in the EU. For others
the decision not to harmonise recognition and enforcement of third State
judgments in the Brussels I Recast can be justified on (reverse) subsidiarity
and/or legal diversity grounds.
Intellectual Property
As previously noted, there is substantial litigation before Belgian courts
involving the cross-border protection of IP rights, including patents,
copyright and trademarks. The case law is mainly about issues of jurisdiction,
both in respect of claims on the merits and claims for injunctive relief. In
general, Belgian courts pay due attention to the body of European law that
governs this field, they apply the Brussels I Regulation, and they are faithful
to the interpretative rulings from the Court of justice.
Three issues were raised for discussion: exclusive jurisdiction under
article 22, tort jurisdiction under article 5(3) and choice of law for online
infringement of copyright.
Exclusive jurisdiction under article 22(4)
We know that as a result of the decision in GAT (Case C-4/03 [2006] ECR I6509), the exclusive jurisdiction is engaged where the registration or validity
of the IP right is raised as a substantive issue in the proceedings, even if only
as an incidental matter, such as when the invalidity of a patent is raised as a
defence against an action for infringement.
The Belgian Court of cassation has ruled recently on a related issue.
Judgment of 1 October 2010 (Universitair Medish Centrum Utrecht). Question of
whether the dispute about the determination of the owner of a European
patent falls within the scope of article 22(4). The dispute was seemingly
between an employer and an employee. In line with the decision of the ECJ in
Duijnstee (Case 288/82 [1983] ECR 3663), the Court of cassation ruled that
article 22(4) of Brussels I does not apply to an action by which the claimant
seeks to determine who has the capacity to make an application to obtain a
European patent to the European patent office. This would seem to be correct.
However, the parties to the dispute and the Court of cassation have failed to
consider the application of the Protocol on Recognition attached to the
European Patent Convention, which includes jurisdictional rules for disputes
relating to ownership of European patents. Pursuant to article 71 of the
Brussels I regulation, these special jurisdictional rules take precedence over
article 22(4). The rules are highly complex, and use three different connecting
factors (residence of applicant, residence of the party claiming ownership of
the right, place of employment of the employee)
22
Tort Jurisdiction under article 5(3)
A review of the Belgian case law from the last 10 years was given concerning
the application of 5(3) to IP disputes. It was noted that the recurrent question
is about the impact of the Shevill (Case C-68/93 [1995] ECR I-415) case law in
this matter.
Up until very recently, there was no ruling from the Court of Justice in
particular on IP matters, and the difficult question was whether Shevill
(defamation) was a relevant precedent and how it should be translated in this
field. However since then three recent decisions of the CJEU in Wintersteiger
(online infringement of trademark – Case C-523/10 [2012] ECR I-00000), Folien
Fischer (negative declaration – Case C-133/11 [2012] ECR I-00000), and the
decision in Pinckney (online infringement of copyright – Case C-170/12 [2013]
ECR I-00000) have changed the legal landscape.
Some early cases decided that the harm is suffered at any place where
the website is accessible, and thus Belgian courts have jurisdiction as soon as
the website is accessible in Belgium. More recent cases have adopted a more
sophisticated approach: in the Liberty-Voyage case (2004), the Court of appeal
of Brussels ruled that the mere accessibility of the site in Belgium could not be
considered as jurisdictionally relevant for the purpose of the application of
article 5(3). What is relevant is that the defendant, based in Switzerland, is
using the domain name “.com”, and not a Swiss domain name. The court also
mentions the fact that the trademark is registered in the Benelux, and thus,
because of the territoriality of IP rights, the damage must be localised in
Belgium. This is in line with the recent decision in Wintersteiger.
Servercheck v. Google (2006): alleged that Google, through its search
engine, is an accomplice of an infringement of the right over software because
pirated software can be located through the search engine. Belgian courts
have jurisdiction for a claim against Google Netherlands because the services
are offered to Belgian residents through “Google Suggest”
The Roland Garros case of FFT (Fédération française de tennis) v. Ladbrokes
Betting and Gambling was a decision of the Court of first instance of Liège from
2008 in a claim by the French organiser of the French Open against a UK
company (Ladbrokes). It was alleged that Ladbrokes operated a website that
was accessible in Belgium and to Belgian residents, where it was possible to
bet on the results of the French open. None of the parties were domiciled in
Belgium. The Court found that the causal event was located in the UK, where
the website was hosted. But for the Court, the harm was located in Belgium,
and therefore the Belgian courts had jurisdiction. Why? Because the Court
found that the website was targeting specifically, amongst other countries,
Belgium, because it was possible to bet on the website not only for the tennis
matches in France, but also for the matches of the Belgian football league.
This matter is now dominated by the case law from the Court of
Justice, eDate Advertising GmbH/Martinez and Wintersteiger. In eDate/Martinez
(Cases C-509/09 and 161/10 [2011] ECR I-10269), the Court ruled that for
infringement of personality rights over the internet, jurisdiction is provided at
23
the place of the centre of interests of the victim without limitation and at the
place where the website is accessible but limited only to the local harm.
In Wintersteiger, the Court ruled that the centre of interest forum
applies only for infringement of personality rights, and that for trademark
infringement the place where the damage occurs can only mean the Member
State where the trademark is registered.
Between these two cases, the Belgian Court of cassation has ruled on
the application of 5(3) in an online tort. It is the case FC Porto v. Sporting
Exchange (29 November 2012). In this case a claim was brought in Belgium by
three top European football clubs (Porto, Juventus and PSV) and three players
from these clubs. Claims were brought against various UK betting businesses,
including BWIN. The claim alleges that the UK betting companies have used
without permission the names, images and trademarks of the three clubs and
players. Before the lower court (Court of appeal), it had been held that the
Belgian court had justification in respect only of the claim brought by the PSV
club, because this claim was based on an infringement of a Benelux
trademark. For the court, this was enough to show a meaningful connection
with Belgium.
As for the claim of Porto and Juventus, it was based on the
infringement of community and international trademarks, and on the
unauthorised use of the image of the clubs and players. The court found that
there was no jurisdiction for these claims because the websites did not target
Belgium, and it was shown that the volume of betting by Belgian residents
was small. The Court referred to the de minimis concept: the effect of the
website on the Belgium market was so small that there was no meaningful
connection between the dispute and Belgium. Thus the Court of appeal
followed the French court of cassation approach.
Based on eDate, the Court of cassation has overturned the decision (the
Court does not refer to Wintersteiger, though this case had also been handed
down by 29 November 2012). The Court of cassation cites the passage of
eDate where the CJEU holds that jurisdiction exists at the place where the
website is accessible. Thus, in the present case, as the website was accessible
in Belgium, this was enough to establish jurisdiction.
Two problems were then identified with the approach taken by the
Court of Justice. First, the CJEU seems to establish a distinction between civil
tort and commercial tort. Secondly, that in a trademark case, the place of
damage is necessarily and exclusively deemed to be located in the Member
State where the trademark is registered. It was suggested that although these
propositions may be correct under substantive law, they are irrelevant for the
purpose of the application of article 5(3). The Court of Justice has made clear
that the issue of jurisdiction is independent from the existence of a cause of
action or of damage under the substantive law. In Marinari (Case C-364/93
[1995] ECR I-2719), the Court ruled that the Brussels regime “did not intend to
link the rules on territorial jurisdiction with national provisions concerning
the conditions under which non-contractual liability is incurred. Those
conditions do not necessarily have any bearing on the solutions adopted by
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the Member States regarding the territorial jurisdiction of their courts, such
jurisdiction being founded on other considerations”. Likewise, in Shevill, the
Court ruled that article 5(3) applies irrespective of the fact that under the
applicable national law “damage is presumed” and that the plaintiff does not
have to evidence “the existence of damage”.
These principles should hold true also in matters of intellectual
property: the existence of a jurisdictional basis under article 5(3) should not
depend on the protection (under the applicable law) of the right in trade
mark, patent, or copyright relied upon by the plaintiff. As in any other
dispute involving a tort liability, the success of the action depends on the
existence of a cause of action under the applicable substantive law, which in
intellectual property matters traditionally supposes an infringement within
the territory where the right is protected. But this has nothing to do with
jurisdiction, which, as indicated by the Court of Justice, is based on “other
considerations”, i.e. mainly the proximity between the forum and the factual
elements of the dispute.
The only relevant issue for the purpose of article 5(3) is the
identification and localisation of the jurisdictionally meaningful element
constituting the place of damage in infringement matters. For jurisdiction to
be established at the place of damage, there must be a sufficient link between
the actions of the defendant and the damage alleged by the plaintiff.
It could be argued that when infringing material is placed on line it is
foreseeable that it could create damage in any Member State where an IP right
is registered or held. But this proposition would fail to take into account the
issue of control of the defendant over the place of distribution. There is no
doubt that jurisdiction would not be proper under Shevill only because
readers would have brought the newspaper home from abroad. In print
publication, the notion of distribution suggests affirmative actions by the
defendant to place or push the publication in the forum, such as by the
decision to print enough copies for international circulation, to enter into
agreements for distribution, or to channel by other means the publication to a
certain country.
It is therefore submitted that on-line infringements are not, as such, an
exception to the general principles regarding the interpretation of article 5(3)
stemming from the Court of Justice’s case law. On the contrary, these general
principles can be applied by analogy to on-line infringements. The basic
principle is that the damage is sustained in the country or countries where the
infringing material is (or may be) aimed at, because this is the place where
economic loss is sustained or threatened.
Choice of law for online infringement of copyright
Discussion focussed on a recent landmark case from the Court of appeal of
Brussels, in the case of Google Inc. v. Copiepresse (9 May 2011). The case is
about the “Google News” webpage, which brings together press articles from
different Internet journals. The webpage only shows the title and first few
sentences of the article. Anyone who wants to read more needs to click on a
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hyperlink, which then shows the full article on the original webpage of the
newspaper. A Belgian royalty-collection association, representing the
publishers of the Belgian press, has brought proceedings against the US
company Google Inc. Google is accused of copyright infringement as a
consequence of the reproduction of excerpts from the Belgian press.
The first question for the Court of appeal was to assess the applicable
law. Google had maintained that American law should apply: under US law,
the activity was most likely legal as it fell within the fair use exception.
Google relied on Article 5(2) of the Berne Convention, which provides
that the protection of copyright is “governed exclusively by the laws of the country
where protection is claimed”. This is the so-called lex loci protectionis rule. It is
also provided, in similar terms, in article 8 of the Rome II Regulation. In the
well-known Waterworld (or Lamore) case, the Court of cassation of France had
ruled that the lex loci protectionis designates the place where the copyright
infringement took place, and not where the harm is suffered. Some French
courts have applied this case law to the online context, holding that an alleged
copyright infringement committed through the use of a search engine hosted
in the US is governed by US law.
The Court of appeal of Brussels has taken an entirely different
approach. The Court held that the issue in this case was about the protection
of copyright in the country of origin, namely the country where the
newspaper articles were published for the first time, namely Belgium. The
Court found that as a consequence, article 5(3) of the Berne Convention
applies: it provides that “protection in the country of origin is governed by
domestic law”. The Court therefore found that Belgian law applied. This
reasoning is not without problems: in particular, can the posting of data on
the internet be considered as publication in the legal sense? If yes, how do
you assess the place of first publication of a work on the internet? Is it the
place from where the work is uploaded on the internet? Or the place where
the work is accessed on the internet?
While preferring article 5(3), the Court notes that the solution would
have been the same under article 5(2) of the Berne Convention. The court
considered that the “unlawful act”, which is jurisdictionally relevant for 5(3),
“is committed when protected works are disseminated in Belgium on the Google. be
website, and it is of little relevance whether these are automatically injected by robots,
allegedly located abroad” (namely in California). Thus, the Court upholds the
“country of reception” theory, which is based on the same rationale as the
“localisation theory” which has been used in the Football Club Porto case
under Brussels I.
It was pointed out that the Court also noted that the solution would be
the same if the issue was resolved under the Rome II Regulation. The Court
referred to did not refer to article 8 of the Regulation: this was not useful,
according to the court, as it provided for the same rule as in the Berne
Convention. The court noted the general rule of article 4 of Rome II, which
provides for the application of the law of the place where the damage occurs,
unless the tort is more closely connected with another country. In the present
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case, the court found that the press articles were of interest mainly for
cybernauts living in Belgium, and therefore article 4 designated also Belgium.
The Swedish Experience
There is much that could be said about collective redress, but one initial
problem is that the concept is not entirely transferrable to Swedish conditions.
By choosing to focus on the general question as to how collective interests on
the side of the plaintiff are handled in Sweden it was possible to make some
observations. In that regard Sweden does have fairly new legislation
regarding class actions (or rather group proceedings) that is generally
applicable in civil cases (the Group Proceedings Act, 2002:599). Therefore that
piece of legislation was considered in relation to its applicability in relation to
claims in the field of intellectual property and competition. It was highlighted
that there were not many Swedish cases though, and consequently the
discussion had to be in the abstract using hypothetical examples.
One such example, of general interest, was a recent decision from the
district court of Stockholm regarding copyright infringements. In the case
SCANPIX (the plaintiff) argues that Google is infringing copyright in relation
to photos that are being used in Google News. The case is not a “class action”
but it can easily be amended to fit as an example.
It was also put forward that Sweden has a tradition to address
collective interest by way of governmental intervention. One example was the
Swedish (and now European) tradition to appoint an “Ombudsman” to take
care of weak parties. One such exists in the field of competition (i.e. the
Consumer Ombudsman). In this regard case-law examples were submitted
where the Consumer Ombudsman represented the plaintiffs.
Additional techniques by which collective interests can be satisfied in
the Swedish judicial System were discussed. One such example was where
there was the possibility to adjudicate one case, a “pilot-case” in relation to
other similar claims. This solution does not mean that the decided case will be
legally binding in relation to other claims, but the fact that it is decided as a
“pilot-case” means that the likelihood that parties involved in similar
disputes will agree on settlements.
As to the cross-border aspect of the theme it was agreed that there was not
much to say. Jurisdiction is to a large extent located to the domicile of the
defendant, irrespective of the domicile of the plaintiff. Consequently, as a
principal rule, foreigners may benefit from the Swedish judicial system if they
have a valid claim and if jurisdiction exists in relation to the defendant. This
general perception does not differentiate between individual and collective
claims; where as collective redress is possible in Sweden (under the Swedish
Group Proceedings Act) if jurisdiction exists under traditional jurisdictional
rules (e.g. the Brussels/Lugano system).
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