Posts Tagged Regulatory competition
I was at the Belgian Parliament yesterday for a hearing on the BIBC, following publication of the Government’s draft bill. For those of you who read Dutch, my notes are attached. We were limited to two pages of comments – the note is succinct.
An important change vis-a-vis the initial version (on which I commented here) is that the Court will now be subject to Belgian private international law (including primacy of EU instruments) for choice of law, rather than being able to pick the most appropriate law (arbitration panel style). That brings the court firmly within Brussels I. Also note my view and references on the Court being able to refer to the CJEU for preliminary review.
In BDO Cayman v Argyle Funds, reported by Harneys, the Grand Court of the Cayman Islands followed English and Australian authority in having an anti-suit injunction followed by a cost order against the party that had infringed choice of court. Costs including not just the domestic proceedings (that would be obvious) but also the foreign proceedings (here: in the US).
It is this type of measure which makes jurisdictions stand out and be noticed in civil procedure regulatory competition – not, as I flagged earlier, half-baked attempts to add some gloss via international business courts.
A short post (my diary is clearing up ever so slightly – I may finally have time for a proper cuddle of the blog next week onwards) to flag my Rotterdam colleague prof Xandra Kramer’s conference on International business courts, on 10 July.
I unfortunately am already expected elsewhere hence I will not be able to ask this question in person, hence here’s one for someone else out there to ask: why are all these States busying themselves touting ad hoc special courts – when what they really ought to be doing is making their civil procedure system as a whole more attractive? : for surely it is not only the English language that attracts litigation to London.
A conference warmly recommended!
Update 9 Mach 2018 for the rules of procedure of the International Commercial
Chambers of the Amsterdam District Court (Netherlands Commercial Court) and the
Amsterdam Court of Appeal (Netherlands Commercial Court of Appeal) (The NCC Rules) see here.
I was asked yesterday (interview in Dutch) for my thoughts on the Belgian Government’s plans for a Brussels International Business Court. Here goes, in bullet-points format, a slightly extended and more technical version of those preliminary thoughts:
- Three and more’s a crowd. The Belgian move of course is not the first and neither will it be the last. Even pre-Brexit, Member States (and even individual cities within Member States; see Michiel Poesen recently on Frankfort) were vying for the title of preferred place for litigation.
- Brexit evidently may be a game-changer. I have flagged repeatedly that post-Brexit and assuming there will be no deal which would roll-over the UK’s engagement with EU civil procedure law, UK courts will become a lot less attractive. This is due to the more cumbersome recognition and enforcement regime that will be the result of decoupling from Brussels I. The same incidentally does not apply to arbitration. Pre and post Brexit, deal or not, free movement of arbitral awards is subject to the New York Convention.
- Attractiveness as a centre of litigation and legal services is part of regulatory competition. Being known as a place of legal know-how and expedited litigation brings prestige as well as attractive billable hours to the law firms of one’s country.
- Crucially, in an attempt to prise litigation away from London in particular, the use of English in proceedings is always the eye-catcher for the media. However in reality the language of proceedings is to my experience not the defining issue in client’s forum shopping strategies. Know-how of the bench; speed of proceedings; transparency of case-law; and of course ease of recognition and enforcement, are much more so. The Belgian proposal acknowledges as much by touting in particular the ‘collegiality’ and ‘expertise’ of the pool of (domestic and foreign) commercial law experts that will populate the court.
- Unwittingly perhaps but without a doubt, the proposal in flagging the benefits of the BIBC, also highlights the well-known disadvantages of the Belgian courts in ordinary: tardiness of proceedings (the ‘Belgian’ torpedo) in particular. However also very much so, intransparency (as I have repeatedly signalled: access to Belgian case law continues to be highly problematic) and lack of collegiality among the bench: being a judge is a lonely professional existence in Belgium. Professional secrecy rules, practicalities (lack of proper office space), and the aforementioned reporting issues work against Belgian jurisprudence presenting itself as coherent.
- At a technical level, the proposal emphasises repeatedly that the BIBC will be a court. Not an arbitral tribunal. The difference lies particularly in the easy or enforcement. The draft Bill loudly talks the talk in this respect. But does it walk the walk? What a ‘court’ means within the context of EU civil procedure law is of course the prerogative of that EU law: not of the Member States. (I refer to recent blog posts on same). Extensive reference to UNCITRAL’s Model Law on international commercial arbitration is a strange prop to use in the draft, if the idea is to take one’s attention away from arbitration. The BIBC will only take cases in the event of prorogation (choice of court or submission). The pool of judges will mostly be taken from part-timers, not benchers. Most importantly, in my mind: Article 43 of the draft instructs the BIBC, with respect to choice of law, to respect parties’ choice of governing law, and, in the absence of such law, ‘to apply the law determined by the conflict of laws rules which it considers applicable’. This is a copy /paste from Article 28(2) of the Model Law. In footnote the Act suggests that by omitting the third para of said Law (‘The arbitral tribunal shall decide ex aequo et bono or as amiable compositeur only if the parties have expressly authorized it to do so’), the Bill emphasises the nature of the BIBC as court. It does not. Courts are simply subject to Rome I and II when it comes to applicable law. They do not just ‘consider a law applicable’.
Much to chew on. My analysis is based on a draft Bill which a little bird sent me. This is probably not the final say on the BIBC. (On an aside: @BIBC is already taken. I can think of one or two Twitter Handles which the BE government may want to snap up before someone else does).
Update 21 April 2017 many thanks to Gordon Nardell QC for alerting me to the Bar Council’s Brexit papers which includes one on jurisdiction and enforcement.
The House of Commons’ report on ‘negotiating priorities for the justice system’ reviews more than conflict of laws, indeed it is a tour d’horizon of most (if not all) issues relevant to Justice and Home Affairs in the EU. Martha Requejo makes a number of valid points on the report and indeed plenty of these, and others, have been made by a number of conflicts commentators: I will not review all here. There is a scholarly cottage industry on post-Brexit issues and the area of private international law is no exception.
The report mentions among others that a role for the CJEU in respect of essentially procedural legislation concerning jurisdiction, applicable law, and the recognition and enforcement of judgments, is a price worth paying to maintain the effective cross-border tools of justice discussed throughout our earlier recommendations. That is a very sensible approach, not just within the overall context of UK /continent judicial co-operation: it is also an obvious lifeline for London’s legal services market. Without proper integration into the EU’s civil procedure corpus, judgments from UK courts will immediately lose a lot of their appeal. The Government however have manoeuvred itself into a cul-de-sac by rejecting a role for the European Court of Justice post Brexit. The report’s call, and many with it, therefore is likely to fall upon deaf ears. Both for the UK and for EU conflicts rules, this will be a great loss. Few continental courts live up to the same standards as their UK counterparts when it comes to applying the intricate detail of conflict of laws, whether EU based or not.