12 Recognition and enforcement of judgments
in civil and commercial matters
| (a)
(30610)
9149/09
COM(09) 174
(b)
(30569)
9150/09
COM(09) 175
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Commission Report on the application of Council Regulation (EC) No. 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.
Green Paper on the review of Council Regulation (EC) No. 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.
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| Legal base | n/a |
| Document originated | (a) and (b) 21 April 09
|
| Deposited in Parliament | (a) 1 May 2009
(b) 29 April 2009
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| Department | Ministry of Justice
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| Basis of consideration | EM of 13 May 2009
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| Previous Committee Report | None
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| To be discussed in Council | n/a
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| Committee's assessment | Legally and politically important
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| Committee's decision | Not cleared; further information requested
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Background
12.1 The subject matter of documents 9149/09 and 9150/09 concerns
Regulation (EC) 44/2001 (the Brussels I Regulation), which deals
with jurisdiction and the recognition and enforcement of judgments
in civil and commercial matters. Pursuant to Article 73 of this
Regulation, the European Commission has now published its report
on an academic review of the application of this Regulation (9149/09).
It is accompanied by a Green Paper which seeks views on ways to
improve its operation (9150/09).
The Document
12.2 The Commission's review of the application of the Brussels
I Regulation includes an analysis of current national jurisdiction
rules that apply in cases where the defendant is not domiciled
in a Member State and an evaluation of the impact of the possible
ratification, by the Community, of the 2005 Hague Convention on
choice of court agreements. Account has also been taken of relevant
judicial decisions within the European Union.
12.3 In overall terms, the report concludes that
the Regulation has generally been a success, facilitating cross-border
litigation through the application of uniform jurisdiction rules,
including rules to regulate parallel proceedings, and rules to
ensure the circulation of judgments. However, the report also
concludes that notwithstanding this overall satisfaction, there
may be a need for improvement in certain specific areas. These
include the following:
- the abolition of exequatur
in the context of the international recognition and enforcement
of judgments;
- the operation of the Regulation in the broader
international legal order;
- the operation of choice of court clauses;
- intellectual property;
- rules governing lis pendens and related
actions;
- provisional measures;
- the interface between the Regulation and arbitration
proceedings; and
- other issues, covering scope, jurisdiction, recognition
and enforcement.
12.4 The Green Paper seeks views on ways to improve
the operation of the Regulation in these areas by the end of June
2009. The Commission has indicated that it would be willing to
accept responses to the Green Paper up until the end of July.
It is expected that the Commission's legislative proposal will
be published early next year.
The Government's view
12.5 The Parliamentary Under-secretary at the Ministry
of Justice (Lord Bach) in his Explanatory Memorandum of 13 May
2009 summarises the Government's reaction to the documents in
the following terms:
"The Brussels I Regulation is a wide-ranging
instrument of general importance in the context of private international
law and in particular international commercial litigation. The
Government believes that the Commission's Green Paper provides
a useful opportunity to improve this important instrument. Some
of the issues raised by the Commission concern areas with significant
policy implications for the UK. These include the following:
Operation of the Regulation in the wider international
legal order:
"This concerns the need to establish circumstances
in which national courts in the Member States should be entitled
to stay proceedings in favour of courts in Third States on the
basis that those proceedings would be more appropriately dealt
with by the latter. Some provision is required here in order to
remedy the current inflexibility in the Regulation.
Choice of court:
"This concerns the current unsatisfactory relationship
between jurisdiction, based on a valid forum selection by commercial
parties, and the rule which accords primacy to courts first seized
under the Regulation. Provision is required here in order to remove
the undesirable scope for parties to rely on that rule in order
to undermine the effectiveness of the chosen jurisdiction in cases
where a party acts in bad faith by bringing proceedings for the
first time in a Member State other than in the agreed forum.
Provisional measures:
"This concerns the unfortunate potential which
the international recognition and enforcement of such measures
has to undermine the Regulation's general scheme of jurisdiction.
This can arise in relation to certain far reaching provisional
measures (for example, interim payment orders) ordered by a court
which does not have jurisdiction over the substance of the matter
and where there is no power inherent in the court with such substantive
jurisdiction to discharge or modify such measures.
The interface
between the Regulation and arbitration:
"By analogy with the situation in relation to
choice of court clauses, this concerns the unsatisfactory relationship
between arbitral proceedings that are commenced in a Member State
pursuant to a valid arbitration agreement and the rule which accords
primacy to courts with jurisdiction under the Regulation. Provision
is required here in order to remove the scope for parties acting
in bad faith to undermine those arbitral proceedings by starting
proceedings in another Member State."
Conclusion
12.6 We thank the Minister for his helpful comments
on the Commission's Report and Green Paper on the Brussels I Regulation.
We broadly share the Minister's reaction to the ideas contained
in the Green Paper.
12.7 We do, however, wish to draw the Minister's
particular attention the recent judgment by the European Court
of Justice in Allianz SpA v West Tankers Inc, Case C-185/07
(Judgment February 10, 2009) in which the Court appears to expand
the scope of the Brussels I Regulation to prevent a court in one
Member State from ordering a party in a case before it to discontinue
proceedings begun by that party in another Member State on the
ground that the parties had agreed to refer any disputes between
them to arbitration in the first state. The Court appears to have
reached that conclusion in reliance on the principle effet
utile although Article 1(2)(d) of the Regulation expressly
and without qualification excludes arbitration from its scope.
We ask the Minister if he regards the judgment as a per incuriam
decision and, if not, if the Government will nonetheless and by
suggesting an appropriate amendment of the text of the Regulation,
seek to ensure that in future judicial decisions affecting the
enforceability of arbitration agreements will not fall within
the scope and protection of the Brussels I Regulation.
12.8 We shall hold the documents under scrutiny
until we have had further word from the Minister, which we would
expect to include a draft or copy of the Government's reply to
the suggestions in the Commission Green Paper.
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