Posts Tagged harmonisation
‘Like Dassonville on steroids’. Bobek AG in Rheinland on personality v territoriality, the nature of EU harmonisation, and its links with (as well as historic roots of) conflict of laws and regulatory competition.
In advising on a territorial restriction in an insurance clause earlier this month, I studied the CJEU judgment in C-581/18 Rheinland, important for the (limitations to the) reach of Article 18 TFEU, the general non-discrimination requirement on the basis of nationality. Bobek AG had earlier opined, and the Court followed, that in the absence of harmonisation and in a scenario with no EU links, Article 18 TFEU is not engaged. I had missed the AG’s earlier opinion – forgive me if I am late to this party.
It is important to sketch the context: Bobek AG had summarised the facts as
A German patient received, in Germany, defective breast implants manufactured by Poly Implant Prothèse SA (‘PIP’), a French undertaking that is now insolvent. The patient seeks compensation before the German courts from Allianz IARD SA, the French insurer of PIP. In France, manufacturers of medical devices are under a statutory obligation to be insured against civil liability for harm suffered by third parties arising from their activities. That obligation led PIP to conclude an insurance contract with Allianz, which contained a territorial clause limiting the cover to damage caused on French territory only. Thus, PIP medical devices that were exported to another Member State and used there were not covered by the insurance contract.
In this context, the Oberlandesgericht Frankfurt am Main (Higher Regional Court, Frankfurt am Main, Germany) enquires whether the fact that PIP was insured by Allianz for damage caused by its medical devices on French territory only, to the exclusion of that potentially caused in other Member States, is compatible with Article 18 TFEU and the principle of non-discrimination on grounds of nationality contained therein.
This post is not on Article 18 TFEU. Rather, consider the excellent (and eloquent) discussion by Bobek AG at 109 ff. Does the imperative of equal protection of all European citizen-consumers, in the absence of EU harmonising law on the issue, preclude a national rule that, in effect, limits insurance cover to persons who undergo surgery on the territory of the Member State, thus indirectly limiting the cover to citizens of that Member State? Bobek AG emphatically and despite moral sympathy for the victims, says no. The alternative would be ‘like Dassonville on steroids’ (at 111), it would ‘turn regulatory competence within the internal market on its head’ (at 109).
Consider his link with conflict of laws at 114-115:
In other words, the fact that goods once came from another Member State is not a sufficient reason to suggest that any matter later concerning those goods is covered by EU law. If that logic were to be embraced, by a questionable interpretation of Article 18 TFEU, the movement of goods in Europe would become (once again) reminiscent of medieval legal particularism, [at footnote 78 he refers to the excellent work by my legal history colleague Randall Lesaffer] whereby each product would, like a person, carry its own laws with it. Goods would be like snails, carrying their homes with them in the form of the legislation of their country of origin, to be applicable to them from their production to their destruction.
Such a consequence would not only displace any (normal) territoriality in the application of laws, but would also generate conflicts of regulatory regimes between the Member States. Indeed, such an expansionist interpretation of Article 18 TFEU could make the legislation of any of the Member States potentially applicable on the same territory without any clear and objective criteria as to which legislation should prevail in a given dispute, with the victim being able to choose the most favourable legislation.’
Most delightful analysis.
Indigenous rights and qualification under conflict of laws. Newfoundland and Labrador v Uashaunnuat (Canada) and Love v Commonwealth (Australia).
Fasken alerted me to, and have good review of Newfoundland and Labrador (Attorney General) v Uashaunnuat (Innu of Uashat and of Mani‑Utenam) 2020 SCC 4. The Canadian Supreme Court held that Quebec has jurisdiction over aboriginal rights claims in a neighburing province. This assertion of jurisdiction hinges on the qualification of rights under section 35 of the Constitution Act, 1982 (the section which deals with aboriginal and treaty rights) as rights sui generis. A qualification as rights in rem erga omnes, as the dissenting opinion suggested, would have kept the case outside of Quebec jurisdictional reach.
The case came a week after the decision of the High Court of Australia in Love v Commonwealth HCA 3 which as Michael Douglas analyses here, is a case about personal status and whether an aboriginal may be considered an ‘alien’ for immigration purposes. Judges split as to the required approach to the issue.
Indigenous rights and conflict of laws for sure will continue to exercise one or two minds (ia in view of the UNSDGs) and these two cases seem to anchor a number of issues. Not something a short blog post can do justice to.
Update 21 November 2019 final text now here.
The representatives at the Diplomatic Conference at the Hague Convention have issued a provisional text of the Convention here. I am short of time to post a quick scan of the Convention – see some of my earlier posts on same. Also, since the Convention has taken on the format of the Brussels regime, it is of course quite an exercise even just to give a quick overview.
Of interest is that Jane Holliday posted a summary of key positive takeaways by prof Paul Beaumont, who was heavily involved in the drafting i.a. as a representative of the EU. These include the room for asymmetric choice of court (not covered by the Hague choice of court Convention and crucial for many common law jurisdictions); and the blend between the US and the EU regime for forum contractus: Article 5(g):
‘the judgment ruled on a contractual obligation and it was given by a court of the State in which performance of that obligation took place, or should have taken place, in accordance with
(i) the agreement of the parties, or (ii) the law applicable to the contract, in the absence of an agreed place of performance,
unless the activities of the defendant in relation to
the transaction clearly did not constitute a purposeful and substantial connection to that State.
Of note of course is also the carve-out for intellectual property and of ‘unilateral’ sovereign debt restructuring, but also of defamation and of privacy.
Much analysis no doubt to follow, as are complications in reaching a unified interpretation of the Convention once ratified.
(Handbook of) EU Private International Law, 2nd ed. 2016. Chapter 2.
The title of this piece is optimistic. Broadly defined many of the conflicts issues I address touch upon civil procedure of course. Yet I rarely address civil procedure pur sang (see here for an example). C-637/17 Cogeco was held by the European Court of Justice yesterday.
The Court held that the EU (competition law) damages Directive 2014/104 does not apply ratione temporis to the facts at issue.
The Directive includes two recitals on limitation periods:
Recital 36 argues
‘National rules on the beginning, duration, suspension or interruption of limitation periods should not unduly hamper the bringing of actions for damages. This is particularly important in respect of actions that build upon a finding by a competition authority or a review court of an infringement. To that end, it should be possible to bring an action for damages after proceedings by a competition authority, with a view to enforcing national and Union competition law. The limitation period should not begin to run before the infringement ceases and before a claimant knows, or can reasonably be expected to know, the behaviour constituting the infringement, the fact that the infringement caused the claimant harm and the identity of the infringer. Member States should be able to maintain or introduce absolute limitation periods that are of general application, provided that the duration of such absolute limitation periods does not render practically impossible or excessively difficult the exercise of the right to full compensation.’
Recital 49 adds
‘Limitation periods for bringing an action for damages could be such that they prevent injured parties and infringers from having sufficient time to come to an agreement on the compensation to be paid. In order to provide both sides with a genuine opportunity to engage in consensual dispute resolution before bringing proceedings before national courts, limitation periods need to be suspended for the duration of the consensual dispute resolution process.’
Article 10 then foresees expressis verbis
1. Member States shall, in accordance with this Article, lay down rules applicable to limitation periods for bringing actions for damages. Those rules shall determine when the limitation period begins to run, the duration thereof and the circumstances under which it is interrupted or suspended.
2. Limitation periods shall not begin to run before the infringement of competition law has ceased and the claimant knows, or can reasonably be expected to know:
(a) of the behaviour and the fact that it constitutes an infringement of competition law;
(b) of the fact that the infringement of competition law caused harm to it; and
(c) the identity of the infringer.
3. Member States shall ensure that the limitation periods for bringing actions for damages are at least five years.
4. Member States shall ensure that a limitation period is suspended or, depending on national law, interrupted, if a competition authority takes action for the purpose of the investigation or its proceedings in respect of an infringement of competition law to which the action for damages relates. The suspension shall end at the earliest one year after the infringement decision has become final or after the proceedings are otherwise terminated
Article 11 adds for joint and several liability
‘Member States shall ensure that any limitation period applicable to cases under this paragraph is reasonable and sufficient to allow injured parties to bring such actions.’
and finally Article 18(1) reads
‘Member States shall ensure that the limitation period for bringing an action for damages is suspended for the duration of any consensual dispute resolution process. The suspension of the limitation period shall apply only with regard to those parties that are or that were involved or represented in the consensual dispute resolution.’
Of note in my view is first of all the unavailing nature of much of the recitals quoted above. As the overview shows, the recitals are more or less verbatim repeated in the actual rules; or the other way around: the Articles’ provisions are copy /pasted into the recitals. To that there is not much point.
Further, the minimum period imposed by the Directive (not applicable, as noted, ratione temporis) is five years. (Compare in the mooted amendment of the motor insurance Directive 2009/103: minimum 4 years is being suggested – subject to gold plating). The Court could not evidently read that minimum period as being ius commune. However it did read much of the qualitative requirements of recitals and articles effectively as ius commune using the effective enforcement of EU competition law as an anchor. It held that the Portuguese limitation period of three years, which, first, starts to run from the date on which the injured party was aware of its right to compensation, even if the infringer is not known and, secondly, may not be suspended or interrupted in the course of proceedings before the national competition authority, renders the exercise of the right to full compensation practically impossible or excessively difficult.
I realise it is a bit of a stretch to see this as a move towards a European Ius Commune on limitation periods. Yet it might be a first cautious step.
Update 22 February 2019 for a most excellent and critical paper by Ronald Brand calling for the 2019 Judgments Project Conference to be aware of all options for international harmonisation in the area see here.
Kraft Foods v Bega Cheese  FCA 549 was signalled to me by Michael Mitchell back in early May – now seems a good opportunity briefly to report on it. The Federal Court of Australia issued an anti-arbitration injunction to restrain a multinational food conglomerate from pursuing arbitration in New York. Kraft had pursued litigation in Australia which not only sought to restrain the respondent from certain radio and television advertising, but also sought final relief including damages.
Parties had agreed to mediate and arbitrate under the dispute resolution provisions of a Master Agreement for licensing of IP. Bega had acquired certain rights from Mondelez (a company in the Kraft group), including certain trademark rights that Kraft had licensed to Mondelez pursuant to the Master Agreement.
Of interest to the blog is the myriad number of issues that led the Court to issue the injunction, among others the fact that what was sought included interim relief, the position of which when it comes to enforcement is not entirely clear in the New York Convention. Throw intellectual property, mediation as well as arbitration, common law doctrine principles such as the Aldi rule in the mix, and the jurisdictional soup becomes quite attractive as well as complex. Precisely why intellectual property is hotly debated in the Hague Judgments project and likely to be excluded from it.
That latter brings me to the second part of the blog title: the HCCH have issued a Revised Draft Explanatory Report, and a document on the possible exclusion of anti-trust matters from the Convention as reflected in Article 2(1)(p) of the 2018 draft Convention. Both signal the continuing difficulty of the roll-out of the Hague Process, as well as continued intent to let the train roll into its end destination; although one wonders how many wagons will have been left behind en route.
(Handbook of) EU Private International Law, 2nd ed. 2016. Chapter 2.
A post more meant to refer the readers to resources rather than to add much analysis myself. I have of course earlier posted on the ‘Hague Judgments Convention’. Things have not stood still since.
A first interesting resource is the April 2018 study prepared for the European Parliament. I am pleased the stellar team of colleagues who compiled the study, although overall (in my view a tad too) optimistic on the project, did not whitewash the difficulties involved in the process. The additional layer of complexity, were the EU to accede to the eventual (if any) Convention, was highlighted as a cause for concern. Also in April: the Australian Government consultation paper on the Hague process.
Next up, the May 2018 documents published on the HCCH gateway, including a new draft Convention and a preliminary draft explanatory report. Each and every one of the articles of the Draft can be the subject of very extensive analysis indeed – one need only look at the Chapters on jurisdiction in the books on EU private international law, to appreciate the level of complexity; and of course the every so slight or not so slight differences between the ‘Brussels regime’ and the ‘Hague process’. I trust one or two of my colleagues are devoting their summer writing up just such an analysis.
The process is to be continued for we are not there just yet.
Perhaps it has been studied already. Perhaps it is more of a PhD chapter, short paper or indeed a case for public interest litigation. Stephanie Bijlmakers and I had a good moan about the lack of access to ISO standards when we wrote on ISO 26000. I now have encountered again how extraordinary it is that the public do not have free access to industry standards with such high societal relevance. The trigger this time round is one of our PhD students enquiring with me about recyclable content in packaging. This has sent me on a goose chase to gain access to a copy without having to fork out £170 each for 5 relevant CEN standards.
So here’s my research starter for ten: could and if so under what circumstances can privately developed yet publicly approved standards be considered environmental information under relevant EU and international rules, access to which needs to be granted without charge?
EU Civil procedure geeks: Time to sit up. Max Planck Luxembourg have their mutual trust study out. Supports arguments against further harmonisation.
Under the leadership of prof Hess, MPI Luxembourg have collated a treasure chest of data on what, in practice, continues to hold up recognition and enforcement of judgments in the EU Member States. The Study, released last week, was conducted for the European Commission. Its main conclusion suggests that in particular the service of documents could do with streamlining.
That all in all modest recommendation suggests that the very variety of civil procedure rules in the EU Member States in and of itself is not the main obstacle in recognition and enforcement. I insert a big caveat here for I have so far only read the exec summary and the main recommendations, however if they are anything to go by, the study in effect has to serve as a strong argument against more harmonisation of civil procedure rules at the EU level.
Debate no doubt to be continued.
(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.16.
Do the newly negotiated EU rules on endocrine disruptors illustrate regulatory chill /the ‘freezing effect’ of international trade law?
The new European Commission proposals on endoctrine disruptors are, of course’ ‘science based’. It has been reported (EurActiv, 12 December 2016 and last consulted by me on 13 December) that publication of the proposals was followed by a closed door meeting (minutes of which were released only after a freedom of information request) between the EC and a select number of countries (US, Canada, Argentina, Brazil and Uruguay on 13 July this year). Discussion centered around the potential WTO incompatibility of parts of the EC proposal, particularly those surrounding the tolerance levels for endocrine disruptors present in imported substances (food and feed in particularly). The EC reportedly are prepared to replace “negligible exposure” with “negligible risk from exposure”. The EC defend the latter, arguing it might even ban more, rather than less imported substances: for even if there is only negligible exposure, that exposure may still be a risk. Opponents suggest that the insertion of a risk approach has sacrified precaution on the altar of science.
A few comments.
Firstly, the report (and potentially even the EC itself) repeats the misleading assertion that the debate concerns either science or precaution. Precaution is NOT unscientific. The very trigger of the precautionary approach is science.
Next, the case is reported at a time a lot of people are getting jittery about the regulatory co-operation mechanisms in free trade agreements such as CETA and TTIP. The meeting and the subsequent EC reaction to our trading partners’ comments, would then represent an example of the ‘freezing effect’ in international trade: with our trading partners flying the flag of WTO incompatibility, the EU would then have caved in to threats of litigation in Geneva. Yet in reality WTO input by fellow WTO Members is at least as old as the WTO itself, indeed it predates it. The 1978 Tokyo Standards Code already obliged the then GATT Contracting Parties to notify their draft standards to the GATT Secretariat. The very point of notification and transparency is that the issues raised are being discussed and may indeed lead to the draft standard being adopted. Changes made to REACH, to name but one example, reflected concerns of fellow WTO Members and REACH can hardly be said to pander to industry’s demands.
However there needs to be one core appreciation in this process: just as notification serves transparency (anyone can consult the TBT notification gateway to review draft measures that have been notified), so too should the process of review after reception of the comments, be conducted in a transparent manner. This clearly has not happened here. By conducting these meetings in private, and by refusing to release the minutes until prompted to do so, EC services have given the impression that there is more than meets the eye. In times where even CETA has not yet been ratified, that is most definitely the wrong approach.
Case C-613/14 James Elliott illustrates that the EU’s ‘New Approach’ to harmonisation is alive and well more than 30 years after its launch. The judgment is best read in its entirety and against the background of the New Approach, following the Court’s judgment in Cassis de Dijon and the introduction of qualified majority voting in the European Single Act.
The Court confirms the important place which CEN-standards occupy in EU law, despite them being private standards, and clarifies the exact impact which these standards have in private relations.
One for harmonisation anoraks.