Article published on changes to jurisdiction rules under recast Brussels Regulation

The recast Brussels Regulation has introduced significant changes to the EU rules on jurisdiction and the enforcement of judgments for proceedings commenced from 10 January 2015. Adam Johnson, Anna Pertoldi, Nick Peacock and Hannah Ambrose have published an article in PLC Magazine, The recast Brussels Regulation: Implications for commercial parties, which considers the key changes and the areas in which uncertainty remains.

This article was first published in the January/February 2015 issue of PLC Magazine – click here for the PLC magazine home page.

We have also published a “handy client guide” to jurisdiction under the recast Brussels Regulation, featuring a decision tree to help determine whether the English court will have jurisdiction over a dispute under the new rules. Click here to download a copy.

 

When can the court stay proceedings against an English domiciled defendant in favour of proceedings in a non-EU court?

The High Court has held that it had power to stay proceedings against an English domiciled defendant in favour of the courts of Western Australia, as the dispute came within an exclusive jurisdiction clause in favour of those courts: Plaza BV v The Law Debenture Trust Corporation [2015] EWHC 43 (Ch).

When the English court can stay proceedings against an English domiciled defendant in favour of proceedings in a non-EU court is a vexed question under English law.

The ECJ in Owusu v Jackson Case C-281/02 decided that there was no power to stay proceedings in favour of a non-EU court on the grounds that it would be a more appropriate forum (forum conveniens) for the resolution of the dispute (see post). That left open the question whether there was a power to stay other than on forum conveniens grounds, so where for example there is an exclusive jurisdiction agreement in favour of a non-EU court or there are competing proceedings (lis pendens) in a non-EU court.

The current decision adds to the weight of first instance authorities which find that there is such a power, at least where there is an exclusive jurisdiction agreement. The court was also inclined to consider that it had power to stay on the basis that there were ongoing proceedings in Western Australia, but did not reach a decision on that point. It would also have been prepared to order a stay on case management grounds if that had been necessary.

Below we consider the Plaza decision in more detail, as well as the potential impact of the recast Brussels Regulation which applies to proceedings commenced on or after 10 January 2015 and so was not considered in this case. Continue reading

Contracts with consumers – where can a business sue and be sued?

Where a business has directed its activities to an EU member state in which a consumer is domiciled, two consequences follow: (i) it can generally only sue the consumer in that member state; and (ii) the consumer can choose to sue the business in that member state (among other options). Since 10 January 2015, that applies regardless of whether the business is itself EU domiciled or has any presence in the EU (see our post summarising the key changes under the recast Brussels Regulation).

The Court of Appeal has considered the test of when a business directs its activities to a member state, in the context of similar rules which apply to determine jurisdiction as between England and Wales, Scotland and Northern Ireland: Wood v Hewitsons LLP [2014] EWCA Civ 1698.

Here the question was whether an English firm of solicitors were directing their activities to Scotland and therefore could only sue their Scottish domiciled client in Scotland. The court applied the principles laid down by the CJEU in Peter Pammer v Reederei Karl Schluter GmbH & Co KG [2012] CLR 972, concluding there was nothing to suggest the nature of the activity was international and the activities were therefore not directed to Scotland.

The case is of interest as there are relatively few cases applying the Pammer principles in practice, and the court in this case appears to have taken a relatively strict approach on the facts in the context of professional services. Continue reading

Recast Brussels Regulation applies to proceedings commenced from today onwards

The recast Brussels Regulation introduces significant changes to the EU rules on jurisdiction and the enforcement of judgments for proceedings commenced from today, 10 January 2015 (Regulation (EU) 1215/2012).

The key practical implications for parties based both within and outside the EU are outlined in our recent post New EU jurisdiction rules apply from 10 January: Do you know where you can sue and be sued?.

We have also published a Handy client guide to jurisdiction under recast Brussels Regulation: England and Wales featuring a decision tree to help determine whether the English court will have jurisdiction over a dispute under the new rules.

New EU jurisdiction rules apply from 10 January: Do you know where you can sue and be sued?

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). Though similar in most respects to the original version of the Regulation it replaces, the recast Regulation includes some significant changes. The key practical implications for parties based both within and outside the EU are outlined below under the following headings:

(You can click here for a copy of our recently published “Handy client guide to jurisdiction under recast Brussels Regulation: England and Wales”. The guide features a decision tree, which is intended as a quick reference guide to help determine whether the English court will have jurisdiction over a dispute under the new rules.) Continue reading

Our new “Handy client guide to jurisdiction under recast Brussels Regulation: England and Wales”

JurisdictionguideIn light of the upcoming changes to the EU rules governing jurisdiction and the enforcement of judgments, which will apply to proceedings commenced from 10 January 2015, we have published a new client guide to the English court’s jurisdiction under the recast Brussels Regulation (No 1215/2012). The guide 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 as an interactive PDF by clicking on the image to the right, or via the “jurisdiction guide” tab on the top menu. Or click here for a printer-friendly version.

In broad outline, the main areas of reform under the recast Brussels Regulation are:

  • extending the rules relating to jurisdiction agreements and defusing “torpedo” actions
  • clarifying the extent and effect of the exclusion of arbitration from the ambit of the Regulation
  • new rules on stays in favour of proceedings in a non-member state
  • extending the rules relating to consumers and employees to apply to non-EU domiciled traders and employers
  • making Member State judgments immediately enforceable across the EU

Upcoming webinar – The recast Brussels Regulation: what it means for commercial parties

The EU rules governing jurisdiction and enforcement of judgments will change significantly from 10 January 2015, when the recast Brussels Regulation (No 1215/2012) will apply in place of the current regime.

On Wednesday 19 November, at 12.45 – 1.45pm GMT, Adam Johnson, Nick Peacock and Anna Pertoldi will deliver a webinar for Herbert Smith Freehills clients and contacts which will consider the key changes and their impact on commercial parties in practice, including a look at the problems addressed by the new rules and a discussion of where uncertainties remain. In broad outline, the main areas of reform are:

  • extending the rules relating to jurisdiction agreements and defusing “torpedo” actions
  • clarifying the extent and effect of the exclusion of arbitration from the ambit of the Regulation
  • new rules on stays in favour of proceedings in a non-member state
  • extending the rules relating to consumers and employees to apply to non-EU domiciled traders and employers
  • making Member State judgments immediately enforceable across the EU

Continue reading

A litigator’s yearbook: 2012 (England and Wales)

At this time of year it is traditional to look back over the past 12 months and try to sum up what the year has had to offer. We thought it might be helpful to do the same from a litigator's perspective, and so we have set out below an outline of some of the key developments from 2012 on topics of interest to litigators.

So whether you've been following developments closely throughout the year and just want a quick refresher, or you're a year behind and need help catching up, we hope there will be something of interest for you below. Continue reading

Reforms to Brussels Regulation now finalised

On 6 December the Council of EU Justice Ministers adopted proposed reforms to Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the Brussels Regulation). The changes had been proposed by the European Commission in December 2010 (see post) but were significantly revised before being approved by the European Parliament (on 20 November) and the Council.

The new Regulation (No 1215/2012) will come into force 20 days after its publication in the Official Journal of the EU, expected in a few weeks’ time, but will not apply for another two years after that date. So it will be early 2015 before we see how the changes play out in practice. The key changes are as follows:

  1. Making EU member state judgments immediately enforceable across the EU without the need for an intermediate registration process in the enforcing state (i.e. abolishing the so-called “exequatur” procedure).
  2. Strengthening jurisdiction agreements by requiring member state courts to stay proceedings where there is an exclusive jurisdiction agreement in favour of another member state’s court and that court has also been seised of proceedings, thereby defusing “torpedo” actions.
  3. Extending the rules relating to jurisdiction agreements to apply where neither party is EU-domiciled, and extending the rules relating to consumers and employees to apply to non-EU domiciled traders and employers.
  4. Clarifying that there is an absolute exclusion of arbitration from the ambit of the Regulation, and that exclusion also extends to court proceedings surrounding or in support of arbitration.

The first three of these changes are discussed in more detail below. For more detail on the fourth, see this post on our arbitration blog. Continue reading

UK opts into the Brussels Regulation negotiations

On 14 December the European Commission published its proposals for significant changes to the Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels Regulation). After a consultation that closed on 11 February, the UK government decided to opt in to the negotiations and the resulting reforms and a letter was sent to that effect to the Hungarian Presidency and European Commission on 31 March 2011. During a debate in the House of Commons (European Committee B) on 28 March 2011 some strong indications were given as to the position the Government is going to take in relation to some of the key issues raised by the proposals. Adam Johnson and Pamela Kiesselbach comment. Continue reading