Tag: CJEU

Posted on

The CJEU on consumer signalling with a view to the protected categories, in Wurth Automotive. One or two further specifications of its Gruber, Milivojević, Schrems case-law.

The CJEU last week held in C-177/22 JA v Wurth Automotive. The case concerns the consumer title of Brussels Ia, in particular a refinement of the CJEU  C-630/17 Milivojević and C-28/18  Petruchová case-law (involvement of people with a background in the sector), C-498/16 Schrems (evolvement of use from non-professional to professional or the other way around) and  CJEU C‑464/01 Gruber criteria (dual (non-)professional use).

Applicant in the main proceedings, whose partner is a car dealer and managing director of an online platform for the sale of motor vehicles, was mentioned on the homepage of that platform as the graphic and web designer, without actually having carried out that activity at the time of the facts in the main proceedings. At the request of the applicant in the main proceedings, the partner did some research and contacted the defendant in the main proceedings from his professional email address, in which he indicated a price offer for the purchase of a vehicle. It was stated in that email that the contract of sale was to be concluded on behalf of the applicant in the main proceedings, however a little while after the purchase the partner enquired (but was rebuffed) about the possibility to indicate the VAT amount of the invoice (typically only of interest to business buyers).

Firstly, in applying the consumer title, must account be taken of current and future purposes of the conclusion of that contract, and of the nature of the activity pursued by that person as an employed or self-employed person? As for the latter, the CJEU answer [27] is clearly ‘no’, with reference to Roi Land Investments. As for the former, whether the purpose for the use is current or planned in the future, per Milivojević [88-89], is held by the CJEU not to be of relevance. I would personally add to both Milivojević and Wurth Automotive that any such future use must have been somehow signalled to the business. While the CJEU in Schrems confirmed the possibility to lose the consumer status as a result of subsequent professional use, it has not held (and in my view ought not to) that an initial professional use later changed to non-professional use, may belatedly trigger the consumer section (it has of course supported the later ‘internationalisation’ of the contract per Commerzbank).

Next, what is the burden of proof on whom, and what needs to be proven, when a good or service has been procured for dual professional and non-professional use. Here, the CJEU [30] ff confirms that first of all the professional use or not of the good or service needs to be established on the basis of the objective elements of the file. Only if “that evidence is not sufficient, that court may also determine whether the supposed customer had in fact, by his or her own conduct with respect to the other party, given the latter the impression that he or she was acting for business purposes, such that the other party could legitimately have been unaware of the non-professional purpose of the transaction at issue” [32].

[36] “the impression created by the conduct of the person claiming the status of ‘consumer’….on the part of the other contracting party, may be taken into account to establish whether that person should be afforded the procedural protection laid down in Section 4 of that regulation.”

In the case at issue,

[38] inaction following the presentation of a contract identifying the buyer as a trader, can constitute evidence (but not of singlehandedly determinative value) that the applicant in the main proceedings could have created, on the part of the defendant in the main proceedings, the impression that she was acting for professional purposes;

[39] ditto the sale of the vehicle shortly after the conclusion of the contract and [40] the potential making of a profit, albeit that the latter would in the view of the CJEU ordinarily not be of great impact.

The CJEU finally is not prepared (despite a self-confessed [47] in Wurth Automotive] potential to read same in CJEU Gruber) to read a benefit of the doubt, in inconclusive cases, to the benefit of the alleged consumer, leaving that with reference to CJEU TOTO to national procedural law. Here I think the Court could have held against such benefit on the basis of Brussels Ia itself.

Geert.

EU private International Law, 3rd ed. 2021, 2.231 ff.

 

Posted on

The CJEU in CIHEF on French restrictions to marketing and advertising of rodenticides and insecticides. A masterclass on exhaustive legislation, and on Trade and Environment.

I am hoping for a few gaps in yet again a mad diary this week, to catch up on quite a few developments I tweeted on earlier. First up is judgment in C‑147/21 Comité interprofessionnel des huiles essentielles françaises (CIHEF) et al v Ministre de la Transition écologique ea. The case concerns the possibility for Member States to adopt restrictive measures on commercial and advertising practices for biocidal products. It is a good illustration of the mechanism of precaution or pre-emption in EU law, and of the classic application of Article 36 TFEU’s exceptions to free movement of goods.

Applicants contest the French restriction of commercial practices such as discounts and rebates, as well as advertising, for two specific biocides categories: rodenticides and insecticides. The secondary law benchmark is Biocidal Products Regulation 528/2012.

As for the first category, commercial practices such as discounts, price reductions, rebates, the differentiation of general and specific sales conditions, the gift of free units or any equivalent practices, the Court, also seeking report in the AG’s Opinion, held [33] that the Regulation’s definitions of ‘making available on the market’ and ‘use’ of biocidal products are as such sufficiently broad to cover commercial practices linked to the sale of those products, however [34] that the Regulation does not seek to harmonise the rules relating to commercial practices linked to the sale of biocidal products.

That leaves the classic CJEU Case 8/74 Dassonville test (all measures of a Member State which are capable of hindering, directly or indirectly, actually or potentially, trade within the European Union are to be considered as measures having an effect equivalent to quantitative restrictions within the meaning of that provision), tempered by Joined cases C-267/91 and C-268/91 Keck et Mithouard : there is no direct or indirect hindrance, actually or potentially, of trade between Member States, in the event of:

  • the application to products from other Member States of national provisions restricting or prohibiting certain selling arrangements [[39] of current judgment the CJEU confirms this is the case here]
  • on condition that those provisions apply to all relevant traders operating within the national territory [41 held to to be the case here] and that they affect in the same manner, in law and in fact, the marketing of domestic products and of those from other Member States [[42] held to have to be judged by the national court but 43 ff strongly suggested to be the case here (i.e. there not being distinctive affectation of domestic cq imported products)].

Should the national court decide that (unlike what the CJEU indicates) the French measures are not selling arrangements, carved out from Article 34’s scope altogether, the CJEU [48] ff holds that the French measures most likely  (the final arbiter will be the French judge) enjoy the protection of both Article 36 TFEU’s health and life of humans exception, and the Court’s Cassis de Dijon-inserted ‘overriding reason in the public interest’ aka the rule of reason aka the mandatory requirements exception: strong indications are that the measures are justified by objectives of protection of the health and life of humans and of the environment, that they are suitable for securing the attainment of those objectives and that they do not not go beyond what is necessary in order to attain them. The referring court will have to confirm.

As for the French obligations relating to advertisements addressed to professionals (which includes in particular adding a specific statement), here the Court holds [60] ff that the Regulation does exhaustively harmonise the  wording of statements on the risks of using of biocidal products which may appear in advertisements for those products. This precludes the relevant French rules.

[68] ff however the French prohibition of advertising addressed to the general public, is held not to have been regulated by the Regulation, with the Court coming to the same conclusions as above, viz Article 34’s selling arrangements carve-out and, subsidiarily, Article 36 TFEU’s and the rule of reason exceptions.

A final check therefore is to be done by the referring court however it seems most likely the French restrictions will be upheld.

Geert.

EU Environmental Law, 2017, Chapter 17, p.308 ff.

Posted on

JP v Ministre de la Transition écologique. The CJEU unlike its AG, rules out Frankovich liability for the EU air quality Directives.

Update 02 02 2023 see further analysis by Mario Pagano here.

A disappointing judgment was issued just before end of year 2022, when the Court, unlike its Advocate General Kokott, held that the ambient air quality Directives do not directly grant a right to compensation in the event of an infringement of the limit values.

In Case C-61/21 Ministre de la Transition écologique and Premier ministre, the CJEU essentially insisted ‘Frankovich’ liability (the power for individuals to claim compensation, on the basis of EU law, of EU Member States when the latter fail properly to implement EU law; Such liability is subject to three conditions: namely that the rule of EU law infringed is intended to confer rights on them, that the infringement of that rule is sufficiently serious and that there is a direct causal link between that infringement and the damage suffered by those individuals) can only be extended to cases where the EU secondary law at issue, grants individual rights.

The Court held however that even though [54] the air quality Directives impose clear and precise duties which the Member States need to achieve, these are aimed at protecting the environment and public health as a whole, not individuals’ right to health and environmental protection [55].

Some might see in this reasoning a strict schism suggested by the Court between the collective enjoyment of public health and a healthy environment on the one hand, and the individual availability of same. I do not think though that this is what the Court had in mind, rather, one assumes, an ambition to cap the amount of cases that might otherwise reach the CJEU.

The Court then directs individuals to the national level, so as to obtain if necessary a court order forcing the authorities to draw up relevant plans (a route confirmed by Case C‑404/13 Client Earth) and it of course confirms that national law may be more generous [63].

The unfortunate consequence of the judgment is that there will not be a level playing field for individuals when it comes to employing the right to compensation for infringement of EU law, and of course an encouragement of a certain amount of forum shopping.

Geert.

Posted on

The CJEU yet again, and briefly, on ‘civil and commercial’ in Brussels Ia. Eurelec Trading: when do competition and fair trading authorities act acta iure imperii.

The Court of Justice yesterday held, without Opinion AG (justifiably in my view), in Case C-98/22 Eurelec Trading Sarl, on yet again the interpretation of ‘civil and commercial’ to determine the scope of application of Brussels Ia.

The dispute in the main proceedings is between the Ministre français de lʼÉconomie et des Finances and two Belgian companies: Eurelec, a pricing and purchasing negotiation centre founded by the French Leclerc group and the German Rewe group, and Scabel, which acts as an intermediary between Eurelec and the French and Portuguese regional purchasing centres of the Leclerc group. Two French undertakings are also parties to the dispute: the Leclerc groupʼ national purchasing centre which negotiates the annual framework contracts with the French suppliers (ʻGALECʼ) and the association of E Leclerc distribution centres (ʻACDLECʼ).

Following an investigation conducted between 2016 and 2018, the Economic Affairs and Finance Minister suspected that potentially restrictive practices were being implemented in Belgium by Eurelec in respect of suppliers established in France. The Minister brought an action against those four companies before the Paris courts,  seeking a declaration ia that the practices consisting in (i) requiring suppliers to accept Belgian law as lex contractus (said to circumvent French lois de police), and (ii) imposing seriously reduced returns, were abusive.

The French Government argue with reference to CJEU Movic that ʻacting in the general interest should not be confused with the exercise of public powersʼ, and that one should distinguish the inquiry stage from the judicial proceedings, in particular, that the criterion for applicability of the Brussels Ia Regulation is the use made of evidence and not the rules for collecting it.

The CJEU disagrees. [26] the claim is based on evidence procured during searches which an ordinary litigation party cannot make resort to, and [27] the procedure at issue involves ia an administrative (not a criminal) fine being sought, which is not a request than can be made by an ordinary civil party. [29] The procedure is one which follows from acta iure imperii, the exercise of public power. [29] CJEU Movic is distinguished for in that case no fine was being sought, merely an end to the restrictive practices as well as damages, which both are claims that can also be made by ordinary parties. The latter once again means that depending on what is included in a claim, BIa may or may not be engaged.

Geert.

European Private International Law, 3rd ed. 2021, paras 2.28 ff concluding at 2.65.

Posted on

Tilman v Unilever. CJEU supports choice of court in GTCs even if no possibility of click-wrap is offered.

Update 22 December 2022 see additional comment by Marion Ho-Dac here.

Update 29 November 2022 see here for questions between Marco Farina and myself re the CJEU’s discussion [28-31] of the applicability at all of Lugano, in light of the Withdrawal Agreement.

The CJEU last week held in C-358/21 Tilman v Unilever, the context of which I reviewed here. Krzysztof Pacula has initial analysis here and also refers to the application of the consent for choice of court issues in Ebury Partners.

One of the parties’ (Unilever’s) GTCs  are contained on a website, and their existence is ‘flagged’ in the written main contract, without there bring a tickable box that click-wraps the agreement. Does that suffice to bind the parties as to the GTC’s choice of court (in favour of the English courts)? Note the courts were seized pre-Brexit; the UK’s Lugano troubles are not engaged.

The CJEU answers exactly along the lines I suggested in my earlier post: no impeding of commercial practice; need for the contracting party relying on the clause to have drawn the attention to the GTCs; need for that clause to be durably consultable and storable; finally it is the national court’s task to verify  the formation of consent in these factual circumstances. That there is no box that can be ‘ticked’ is not conclusive [52].

All in all a welcome support for commercial choice of court.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.10.

Posted on

Porr Bau: The CJEU encourages the circular economy and resource efficiency in its approach of waste law and excavated, uncontaminated soil.

The Court yesterday held in C-238/21 Porr Bau. I reviewed Medina AG’s Opinion here.

The Court notes ia [27] Austria’s contention that, under Austrian law, where materials are excavated or demolished in the course of a construction project, the main purpose of the construction developer is usually to carry out that project without being hindered by those materials, with the result that they are removed from the site in question with the intention of discarding them.  That sentence already holds the key to the eventual judgment in the word ‘usually’.

The Court like, as I noted, the AG, repeatedly refers to Sappi Austria. [47] following from the various elements considered in Sappi Austria (which itself cross-refers to eg CJEU Shell), the national court is instructed to determine whether the excavated materials constituted a burden which that construction undertaking sought to discard, with the result that there would be a risk that that undertaking would discard them in a manner likely to cause harm to the environment, particularly by dumping them or disposing of them in an uncontrolled manner. [49]:

In the present case, it is apparent from the information before the Court that, even before the excavation of the materials at issue in the main proceedings, local farmers had made an express request for the supply of such materials. After appropriate construction projects had been found, making the requested excavated materials available, that request, it is stated, led to a commitment by Porr Bau to make those excavated materials available, alongside an agreement under which that undertaking would carry out, by means of those materials, the works to adapt and improve the land and cultivation areas duly identified. Such factors, if proven which it is for the referring court to determine, do not appear to be such as to establish the intention of the construction undertaking concerned to discard those materials.

The Court then leaps to an assessment of whether the soil may be considered a by-product under Article 5 WFD, in a logical sequence which I still do not quite get: [50]

It is, therefore, necessary to examine whether the excavated materials at issue in the main proceedings must be classified as a ‘by-product’ within the meaning of Article 5(1) of Directive 2008/98.

It is the ‘therefore’ which I do not understand. If a party does not ‘discard’ the materials which the Court seems to suggest is the case here, then the ‘waste’ definition is not met. There is then no need to consider whether the materials might be ‘by-products’, for this would mean that if the scenario does not meet with the A5 ‘by-products’ definition, they might nevertheless have to be regarded as waste despite the earlier determination of there not being an element of discarding.

The Court nevertheless assesses all A5 criteria leading it strongly to suggest that these products are indeed by-products. It repeats in my view its fallacy of the waste-by products relationship in the dictum of the judgment:

Point 1 of Article 3 and Article 6(1) of Directive 2008/98/EC of the European Parliament and of the Council of 19 November 2008 on waste and repealing certain Directives,

must be interpreted as precluding national legislation under which uncontaminated excavated materials, which, pursuant to national law, are in the highest quality class,

–      must be classified as ‘waste’ where their holder neither intends nor is required to discard them and those materials meet the conditions laid down in Article 5(1) of that directive for being classified as ‘by-products’, and

–      only lose that waste status when they are used directly as a substitute and their holder has satisfied the formal criteria which are irrelevant for the purposes of environmental protection, if those criteria have the effect of undermining the attainment of the objectives of that directive.

It also rebukes the Austrian regime from the point of view of end of waste status, dismissing some of the Austrian requirements for a material to be able to reach that status, as irrelevant and counter-productive to the objectives of the WFD. These requirements are said to be “formal criteria (in particular record-keeping and documentation obligations) which have no  environmentally relevant influence” however neither the CJEU nor the referring court give any further detail.

This is a first chamber, in a five -judge composition. I don’t think it has definitively solved the relationship between ‘waste’ and ‘by-products’.

Geert.

EU Waste law, 2nd ed 2015, 1.20 ff.

Posted on

Grand Production v GO4YU. Szpunar AG (not, due to suggested inadmissibility) on copyright, VPNs and forum delicti for platform streaming.

Szpunar AG opined a few weeks back in C-423/21 Grand Production v GO4YU  ea. The case involves a variety of issues related to streaming and VPNs, many of which concern telecoms law yet one is of interest to the blog: namely the question whether

in the event of an allegation of infringement of copyright and related rights guaranteed by the Member State of the court seised, that court has jurisdiction only to rule on the damage caused in the territory of the Member State to which it belongs – because the territoriality principle precludes domestic courts from having jurisdiction to determine and examine the facts in relation to foreign acts of infringement – or can or must that court also rule on offences committed outside that territory (worldwide), as alleged by the author whose rights were allegedly infringed?

It transpires from the Opinion however that the case in the national court does not involve one for damages, yet rather one for a temporary injunction prohibiting distribution. To the degree this is aimed at the Serbian defendants at issue, these are domiciled outside the EU and hence not subject for actions in tort, to Brussels Ia. Against the Austrian defendants, the case is subject to full jurisdiction under A4 forum re, hence not triggering the full or partial jurisdictional issues of the relevant CJEU case-law (Bolagsupplysningen etc.).

The AG suggests inadmissibility of the Brussels Ia question.

Geert.

Posted on

ROI Land Investments. The CJEU on letters of comfort and their leading to a qualification as employment cq consumer contract for jurisdictional purposes, and on more generous national rules for the protected categories.

In an interesting judgment, the CJEU yesterday held (no English edition yet) in C-604/20 ROI Land Investments Ltd v FD on protected categories suing a defendant not formally associated with the claimant by a clear contract of employment. That the defendant is not domiciled in the EU is in fact of less relevance to the issues.  I had somehow missed Richard de la Tour AG’s Opinion on same (it happens to the best of us).

Claimant in the main proceedings is FD, domiciled in Germany. Defendant is not his current employer and is not domiciled in a Member State. Yet by virtue of a letter of comfort it is directly liable to the employee for claims arising from an individual contract of employment with a third party. The gist of the case is whether an employee can sue this legal person under the employment title if the contract of employment with the third party would not have come into being in the absence of the letter of comfort.

The slightly complex three part construction, transferring relationships of employment, essentially is one of tax optimisation via Switserland. FD used to be employed by ROI Investment, a Canadian corporation, before his contract was transferred to R Swiss, a Swiss SPV created for the very purpose of the operation. ROI Investment via a letter of comfort effectively guaranteed the outstanding wages due to FD. FD’s contract with Swiss was ended, a German court held this to have been done illegally and ordered Swiss to pay a substantial sum whereupon Swiss went into insolvency. FD now wishes to sue the Canadian ’employer’.

CJEU Bosworth is the most recent case which extensively discusses the existence of ’employment’, referring to CJEU Shenavai and Holterman. In ROI Land the CJEU [34] instructs the national court in particular to assess whether there is a relationship of subordination between individual and corporation, even if subordination is actually only one of the Shenavai /Holterman criteria.

Erik Sinander has already noted here (his post came in as I was writing up mine) that this is a different emphasis from the AG: he had suggested a third party who was directly benefitting from the work performed by the employee (“un intérêt direct à la bonne exécution dudit contrat”) should be considered an employer. That to my mind is way too large a criterion and the CJEU is right to stick to the earlier ones.

[35] the CJEU suggests relevant circumstances in the case most probably confirming the relationship of subordination hence of employment: the activities which FD carried out for his two respective employers stayed the same, and the construction via the  SPV would not have been entered into by FD had it not been for his original employer’s guarantee.

The forum laboris in the case at issue is then I assume (it is not discussed quite so clearly in the judgment) determined by the place of habitual performance of the activities for the third party, the formal (now insolvent) employer, not the activities carried out for the issuer of the letter of comfort: for there are (no longer) such activities.

[37] ff the Court entirely correctly holds that more protective national rules cannot trump Brussels Ia’s jurisdictional provisions for the  protected categories: both clear statutory language and statutory purpose support that  conclusion.

[52] ff the CJEU entertains the subsidiary issue raised in the national proceedings as to whether the contract may be considered a consumer contract. It holds that the concept of ‘a purpose outside (a natural person’s) trade or profession’ does not just apply to a natural person in a self-employed capacity but may also apply to an employee. [56] seeing as FD would not have signed the new employment agreement without the letter of comfort, the employment agreement cannot be considered to be outside FD’s profession. Therefore it cannot qualify as a consumer contract.

Geert.

 

 

Posted on

IRnova v FLIR. CJEU would seem casually to reject reflexivity, and confirms narrow interpretation of A24(4) BIa’s exclusive jurisdictional rule for (in casu non-EU) patents.

Update 2 January 2023 Maxence Rivoir has an excellent note on the case in the CLJ here.

Lydia Lundstedt has prior review of the judgment in CJEU C-399/21 IRnova AB v FLIR Systems AB (who had been business partners in the past) here. Swedish courts are clearly busy referring the private international law elements of patent cases to the CJEU.

Of particular note is that a 3 judge chamber would seem to have ruled out reflexive effect as casually as if it were swatting a fly.

On 13 December 2019, IRnova brought an action before the Patent and Market Court seeking, inter alia, a declaration that it had a better right to the inventions covered by international patent applications, subsequently supplemented by European, US and Chinese patent applications deposited by FLIR in 2015 and 2016, and by US patents granted to FLIR on the basis of those latter applications. In support of that action, IRnova had stated, in essence, that those inventions had been made by one of its employees, meaning that that employee had to be regarded as their inventor or, at the very least, as their co-inventor. IRnova therefore argued that, as the inventor’s employer and thus successor in title, it had to be regarded as the owner of the inventions. However, FLIR, without having acquired those inventions or otherwise being entitled to do so, deposited the applications in its own name.

The court had dismissed jurisdiction viz the Chinese and US patent applications, and the US patents, on the ground, in essence, that it regarded the action concerning the determination of the inventor as being linked to the registration and validity of the patents, and it applied A24(4) BIa reflexively. The Appeals Court referred the issue on reflexive effect to the CJEU, in the following terms:

‘Is an action seeking a declaration of better entitlement to an invention, based on a claim of inventorship or co-inventorship according to national patent applications and patents registered in a non-Member State, covered by exclusive jurisdiction for the purposes of Article 24(4) of [the Brussels Ia Regulation]?’

however the CJEU reformulated [22-24] the case as not concerning reflexive effect at all, rather, enquiring about the scope of the A24(4) gateway.

The Court first of all [25] ff makes a point of confirming its broad reading of the ‘international’ element required to trigger European private international law, referring to CJEU Owusu.

It then [35] would seem to rule out reflexivity in a very matter of factly way (and as Lydia also noted, without AG Opinion) and despite as noted having earlier reformulated the question away from reflexivity:

as has already been pointed out in paragraph 26 of the present judgment, the patent applications at issue in the main proceedings were deposited and the patents concerned were granted not in a Member State, but in third countries, namely the United States and China. As Article 24(4) of the Brussels Ia Regulation does not envisage that situation, however, that provision cannot be regarded as applicable to the main proceedings.

This may have already answered a core question in  BSH Hausgeräte v Aktiebolaget Electrolux.

[36] ff it adds (‘in any event’) reference ia to CJEU Hanssen and to the exceptional nature of A24 [39]. It holds that [42]

the main proceedings relate not to the existence of the deposit of a patent application or the grant of a patent, the validity or lapse of a patent, or indeed an alleged right of priority by reason of an earlier deposit, but to whether FLIR must be regarded as being the proprietor of the right to the inventions concerned or to a portion of them.

[47] it refers ia to the fact that fact that

an examination of the claims of the patent or patent application at issue may have to be carried out in the light of the substantive patent law of the country in which that application was deposited or that patent was granted [however it ] does not require the application of the rule of exclusive jurisdiction laid down in Article 24(4) of the Brussels Ia Regulation

The operative part of the judgment refers both to the A24(4) restrictive interpretation element and to the third countries element hence once cannot simply regard the reflexivity issue as obiter.

Much relevant and surprisingly succinct on the reflexivity issue.

Geert.

EU Private International Law, 3rd ed. 2021, 2.208 and 2.548.

%d bloggers like this: