Hague Convention on Choice of Courts comes into operation in Singapore

The Hague Convention on Choice of Court Agreements (Hague Convention) officially came into force on 1 October 2016 and there are currently 30 signatory states, including all members of the European Union and Mexico.  As we have previously reported, Singapore became a signatory to the Hague Convention on 25 March 2015.  Subsequently, Singapore ratified the Hague Convention by passing the Choice of Court Agreements Act on 14 April 2016.  On 1 October 2016, the Choice of Court Agreements Act came into operation in Singapore and various amendments have been made to Singapore’s civil procedure rules to take account of the impact of the Hague Convention and increased opportunities for the recognition of Singapore court judgments in signatory states.

For more information, please contact Alastair Henderson (Partner) or Daniel Waldek (Senior Associate) or any of your usual Herbert Smith Freehills contacts.

Alastair Henderson
Alastair Henderson
Partner
+65 6868 8000
Daniel Waldek
Daniel Waldek
Senior Associate
+65 6868 8068

 

Impact of CJEU decision in Schrems v DPC on the implementation of cross-border data transfer provisions in Hong Kong

Organisations in the European Union with operations in the United States have, for over a decade now, taken comfort that the transfer of personal data to the United States would be lawful if the recipient had subscribed to the US Safe Harbour Scheme (the "Scheme").  According to the European Commission Decision 2000/520, the operation of the Scheme meant that personal data transferred to the United States would be afforded an adequate level of protection (that is, an EU-standard level of protection).

That is no longer the case.  In the recent case of Schrems v DPC, the Court of Justice of the European Union (the "CJEU") ruled that the US Safe Harbour Scheme does not provide an equivalent standard of protection for personal data, because data recipients are required to disregard the Safe Harbour Principles where they conflict with national security, public interest or law enforcement requirements of the United States.  A summary of the CJEU's decision and, in particular, its immediate consequences for organisations in the EU is available here

This case is of interest in Hong Kong, because of recent indications that the Hong Kong Government may take steps to bring section 33 of the Personal Data (Privacy) Ordinance into effect.  Section 33, once it becomes operative, will prohibit the transfer of personal data out of Hong Kong, unless an exception applies.

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Singapore signs the Hague Convention on Choice of Court Agreements: a step in the right direction for the Singapore International Commercial Court

In our previous article The New Frontier, we discussed the launch of the Singapore International Commercial Court (“SICC“) and in particular we questioned whether issues of cross border enforceability might impact the effectiveness of the new SICC.  Last week, Singapore took a first stride towards addressing the issue by becoming a signatory to the Hague Convention on Choice of Court Agreements (the “Convention“).

The Convention

The Convention, originally concluded in 2005, seeks to provide certainty in international litigation by allowing parties to choose the exclusive court in which any disputes arising under a commercial agreement will be resolved.  Courts of member states will therefore have to respect exclusive jurisdiction clauses in commercial agreements by staying proceedings in favour of the courts of other member states.   Courts of member states must also recognise and enforce judgments of the courts of other member states, subject to certain limited exceptions.

On 25 March 2015, Singapore followed in the footsteps of the EU and the USA by signing the Convention.  Both the USA and the EU signed the Convention in 2009.  Mexico acceded to the Convention in 2007.  In December last year, the EU took the final step towards internal approval of the Convention.  The deposit of the EU’s instrument of approval will then begin a three month period after which the Convention will enter in to force.

We anticipate that the Convention to come in to force later in 2015. We also understand that Singapore intends to ratify the Convention after it comes into force.

Impact on the SICC

Once the Convention is in force, parties to a commercial agreement will be able to agree to submit disputes to the exclusive jurisdiction of the SICC with the certainty that the courts of the US and EU countries (as well as any member states) will be obliged to recognise and enforce SICC judgments, albeit subject to certain limited exceptions.

In this way Singapore will be able overcome one of the issues which have the potential to hinder the appeal of using the SICC – enforceability.  Given that the EU and US are two of Singapore’s largest trading partners, Singapore’s signature of the Convention provides an appealing incentive for parties to submit disputes to the SICC.

This development can be seen to give more strength to the nascent SICC. In the same manner, any increase in the profile of this court can only serve to increase the profile of Singapore as a regional and global dispute resolution centre.  It now remains to be seen whether other countries in the Asia-Pacific region will follow Singapore’s lead and sign the Convention.

For more information, please contact Alastair Henderson (Partner) or Daniel Waldek (Senior Associate) or any of your usual Herbert Smith Freehills contacts.

Alastair Henderson
Alastair Henderson
Partner
+65 68688058
Daniel Waldek
Daniel Waldek
Senior Associate
+65 68688068

New EU jurisdiction rules apply from 10 January: what does it mean for non-EU domiciled parties?

New EU rules on jurisdiction and the enforcement of judgments will apply to proceedings commenced from 10 January 2015, in the form of the recast Brussels Regulation (Regulation (EU) 1215/2012). Herbert Smith Freehills has published a client guide to the English court’s jurisdiction under the recast Brussels Regulation. It features a decision tree, which is intended as a quick reference to help determine whether the English court will have jurisdiction over a dispute under the new rules.

The Guide is available by clicking on the image below.

 Guide

The Guide is relevant to non-EU domiciled parties as it shows when you may be subject to the jurisdiction of the English courts – ie if there is a jurisdiction clause in favour of England and Wales (see Boxes 1 and 4 of the Guide) or under the common law rules (see Box B of the Guide) or under various of the assumptions (eg if certain courts have exclusive jurisdiction due to the nature of the subject matter, or if the defendant enters an appearance).

The key changes for non-EU domiciled parties under the recast Brussels Regulation include that:

  1. The recast Brussels Regulation will apply to you whenever you enter into an agreement with a jurisdiction clause in favour of an EU Member State court – previously it would only be if at least one of the other parties was EU-domiciled. From a practical perspective, in relation to English proceedings, it means proceedings can be served on you out of the English court’s jurisdiction without the need for the court’s permission.
  2. Non-EU domiciled traders and employers are brought within the scope of the recast regulation in certain circumstances, without the need for a branch, agency or other establishment within the EU (which was a requirement under the original Regulation).
  3. There is a new discretion for a Member State court to stay proceedings in favour of competing proceedings in a non-Member State court, where those other proceedings are first in time.

Read more about these issues and the changes to torpedo actions, the arbitration exception, and immediately enforceable judgments across the EU in the post on our Litigation Notes Blog).

 

EU bankers’ bonus cap – CRD IV

The European Parliament has voted in favour of a proposal to introduce new rules (known as CRD IV) to put a cap on bankers’ (who work for European banks anywhere in the world) bonuses. The new rules have attracted a good deal of attention from the banking community and media alike. Gareth Thomas and Susan Leung provide details. Continue reading

Warning to companies of the Importance of compliance with EU merger control filing requirements: EU General Court upholds €20 Million fine imposed on Electrabel

On 12 December 2012 the EU General Court dismissed Electrabel’s appeal against the €20 million fine the European Commission had imposed on it for failing to notify a transaction – the acquisition of a minority shareholding – to the Commission under the EU Merger Regulation (EUMR) and completing the deal without prior clearance from the Commission. The General Court confirmed that such breaches of the EUMR are serious and justify the high fine imposed, even where the transaction did not raise substantive competition law concerns. The judgment serves as an important reminder of the need for all companies – whether based in the EU or not – to carefully consider the application of the EUMR to all transactions, and the severe consequences of getting it wrong. Kyriakos Fountoukakos, James Robinson and James Quinney analyse of this decision. Continue reading

Potential Eurozone Break-Up: Questions and Answers

There has been speculation of the possibility of a withdrawal by a Member State from the Euro. What are the issues for creditors that would arise if a Member State were to decide to leave the Eurozone? What are the potential methods by which a Member State could exit and what are the different consequences? How could a creditor force a borrower in an existing Member State to repay euros? Would the English and existing Member States’ courts take the same approach?

Justin D’Agostino, Tom Chau and Jessica Fei provide some thoughts on the above questions and, in particular,  set out some of the key issues creditors would face recovering euro denominated debts from borrowers based in countries leaving the Eurozone. Continue reading