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Summary Private International Business Law notes
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Private International Business Law-Week 1:
I. Introduction to private international law
1. Introduction
-> Private International Law deals with private legal matters in an international context
-> Private International Law is needed because of:
- legal diversity; laws differ per country
- cross-border judicial matters
- solves conflict
-> Private international law is national law
-> Solve 3 main questions in Private International Law:
1. Jurisdiction:
Which court has jurisdiction over the legal dispute? What is the forum clause?
2. Applicable law:
Which law applies to a given legal relationship? Will the judgment of this court be
recognised and enforced where I need it to be?
3. Recognition and enforcement of foreign judgments:
Is the foreign judgment recognised and enforceable, and under what conditions?
What type of choice of forum clause do I want?
-> Example: I’m based in the NL and I order office supplies from Egypt
- I pay in euro but I don't receive the order
- I want to sue them in NL (because my home country) but what are the applicable
rules? The rules in the contract, State where delivery takes place, or where supplies are
sent? If Egypt and NL have jurisdiction, which one is chosen?
-> Case would be different with 2 EU MS bcs rules do not differ in private international law
2. International Dispute
-> When facing an international dispute, a court applies the PIL rules of the forum(the court
with jurisdiction is called a forum)
1. determine which court has jurisdiction: can choose national or court in other state
2. make the choice of law analysis on the basis of the PIL of the forum
3. see if judgment rendered by such court would be recognised and enforced where you
need it to be -> in earlier example, if NL judgment is not recognised in Egypt - the
judgment is useless
A. Step 1: Jurisdiction
-> One can already add a clause in the general terms and conditions which provides the
applicable laws and which court has jurisdiction
-> Where do you want to sue/be sued?
- where the company is incorporated
- where the company has its headquarters
, - where the company’s assets are located
- where litigation is cheapest
- In EU, Art. 4 (general rule) Brussels I bis Regulation determines the jurisdiction/forum
says persons domiciled in a MS shall, whatever their nationality, be sued in the courts
of that MS
-> ex. A (in Austria) sues B(in Germany), A must go to court in B
-> in earlier case with Egypt, this rule does not matter
- Art. 25 Brussels I bis; “If the parties, regardless of their domicile, have agreed that a court
or the courts of a MS are to have jurisdiction to settle any disputes which have arisen or
which may arise in connection with a particular legal relationship, that court or those courts
shall have jurisdiction. Such jurisdiction shall be exclusive unless the parties have agreed
otherwise”
-> parties can choose where you want to be sued through forum clause
-> applies to commercial parties; does not apply to consumers, employees and
an insured party
> Ex. exclusive can mean ONLY german courts
-> draft the choice of forum clas=use with the client and settle a choice of forum clause for
legal certainty and to benefit the company through language, travel time, cost of litigation etc
B. Step 2 and 3: Applicable law and Recognition
-> In EU, all the judgments of courts in MS are recognised and enforced
-> bcs of Brussels I Bis - but issue outside EU
-> What type of choice of forum clause do I want to use in the general terms and conditions?
-> 3 choices of forum clauses in commercial contracts (between 2 professional parties)
1. Exclusive: limited to one jurisdiction
2. Non-exclusive: nominates one or more jurisdictions but leaves parties the right to
commence proceedings elsewhere (preference)
3. Asymmetric: exclusive for one party, non-exclusive for the other ex. if A wants to sue
B must be in specific court, but B can sue A in any other court
-> Example of all 3 clauses:
1. exclusive choice of forum: “The parties agree that any and all disputes arising from
or relating to this Agreement, including its formation and validity, shall be subject to
the exclusive jurisdiction of the Dutch courts”
2. non-exclusive: “The choice of court mentioned in para 1 does not and is not to
be construed to limit the rights of a party to initiate proceedings against the
other party in another court of competent jurisdiction”
3. asymmetric: “You hereby consent to the exclusive jurisdiction and venue of courts in
Massachusetts, USA … all claims you may have against Tripadvisor LLC arising
from or relating to the Services must be heard and resolved in a court of
component subject matter jurisdiction located in the Commonwealth of
Massachusetts…. Nothing in this clause shall limit the right of Tripadvisor LLC
to take proceedings against you in any other court, or courts, of competent
jurisdiction”
, -> Determine which law applies/you want to apply to the terms and conditions under:
- Art. 3 (general rule) Rome I Regulation “A contract shall be governed by the law chosen
by the parties. The choice shall be made expressly or clearly demonstrated by the terms
of the contract or the circumstances of the case. By their choice the parties can select the
law applicable to the whole or to part only of the contract”
-> applies to contractual obligations in civil and commercial matters -> not tort
obligations
-> if you want the law of ONLY a MS to be applied and not EU law, International
Conventions must be excluded EXPRESSLY from national law
- >Int law (CISG) can overrule national law if not specifically excluded
-> clearly demonstrated can be by ex. applying dutch law to the terms and conditions
-> universal formal scope so any law can be chosen not just the law of the MS & multiple
laws can be used for different parts of the contract
-> Recognition of judgments under Art. 36(1) Brussels I bis Regulation:
“A judgment given in a Member State shall be recognised in the other Member States
without any special procedure being required.”
-> Art. 2(a) any judgment means ‘any judgment given by a court or tribunal of a MS,
whatever the judgment may be called, including… as well as a decision on the determination
of costs or expenses by an officer of the court
-> & recognition based on mutual trust in the administration of justice
-> recognition can be refused only under Art. 45 Brussels
-> Enforcement of judgments under Art. 39 Brussels, a judgment given in a MS that is
enforceable in that MS shall be enforceable in other MS without the need for a declaration of
enforceability and under the same conditions as a decision given in the requested MS
-> can be refused under Art. 45 Brussels
C. Principles governing the choice of law
-> The European regulations on the law applicable (Rome I and II Regulation) use Van
Savigny’s theory as a starting point:
“The whole task is that, for each relationship, the area of law to which this legal
relationship belongs or to which it is subject by its own nature (where it has its seat) should
be sought out.” BUT a choice of law must comply with certain principles:
1. Protection principle: legal systems that apply need to be based on more or
less the same values and standards - choice of law of one country cannot
override the mandatory provisions of the other law - Art. 6 Rome I Regulation
-> ex. French customer buys from China and chinese laws govern the
contract, this choice of law cannot override the mandatory protective rules
under french consumer law (would cause customer to lose his protection but
he is the weaker party)
-> same for employment contracts; worker is the weaker party
2. Favour principle: a choice of forum cannot be designed to favour a certain
result of substantive law - Art 11(2) Rome I Regulation
- A contract that is concluded in different countries is valid ONLY IF it
satisfied the law which governs the substance under this Regulation,
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