Prompted by a kind invitation to participate in the International Weekend of ABILA (American Branch of the International Law Association, NY, 20-22 October 2022), I took a moment to reflect about past achievements and future challenges for private international law (PIL) in the European Union.
We were three speakers in the panel (Karin Kizer and David W. Rivkin also took part), introduced and moderated by Ronald A. Brand, Michael S. Coffee and Louise Ellen Teitz. The description of the panel read:
This panel will focus on the institutions, players, and issues that are important in the global development of rules of private international law. The panelists will include a global representation of institutional and practitioner perspectives. The discussion will be built around a set of questions dealing with both current practical issues raised by private international law developments and projections for the future.
We were asked to include arbitration in the presentations.
The assignment proved not easy. I confess I got stuck at the very first stage, i.e., how to define ‘achievements’ and ‘challenges’ in PIL: are they different when the ‘PIL’ under examination is of European source? I guess the answer is that, indeed, EU instruments and case law (of the Court of Justice) in PIL exist as part of a bigger plan: they serve European integration. By way of consequence, assessing PIL developments requires evaluating whether they promote integration or, on the contrary, act as a hindrance to it.
The next question would then be what ‘integration’ entails, how to measure recent PIL contributions of the EU legislature and of the Court thereto, and what future challenges to integration, posed specifically in the area of judicial cooperation in civil and judicial matters, can be predicted at this stage.
As fascinating as (for instance) the impact on mutual trust of the threats to courts and judges’ independence in some EU countries may be, or whether imposing informational obligations to the Member States creates more transparency or is rather counterproductive, upon reflection a pure ‘European-integration’ approach seemed unfit for the purposes of the ABILA invitation. I gave it up; the topic may still be worth for further thought in another context. Considering the likely (American) audience attending the ILW of ABILA, a walk through the latest developments in EU law and the case law of the Court of Justice looked more appropriate – and already proved too much for the time I had .
From this point of departure, I was happy to report that the political attention to judicial cooperation in civil and commercial matters has not declined in the last years. The legislature has obliged adopting new regulations (Regulation 2016/1103 on matrimonial property regimes; Regulation 2016/1104 on the property consequences of registered partnerships), amending existing ones (Regulation 2015/2421 amending the Regulations on the small claims and the order for payment procedures), and also recasting some (Regulation 2015/848 on insolvency proceedings; Regulation 2019/1111 on matrimonial matters and matters of parental responsibility; Regulation 2020/1783 on taking of evidence; Regulation 2020/1784 of the European Parliament on service of documents).
Indeed, most of the legislative activity of the last decade in the field of PIL is inward-looking. It focuses on strengthening judicial cooperation in the ‘inner circle’ composed of Member States: the task is far from being complete.
From a purely legal (as opposed to political) standpoint, a little bit more surprising is that in some legal instruments a concern for the EU-citizens is made explicit, even where the rules at hand would apply almost equally to non-EU-rooted claimants or defendants: see recital 1 of Regulation 2019/1111; or recitals 8, 32 or 35 of Regulation 2016/1103.
In comparison, the outward-looking activity of the EU lawmaker remains restricted. That is not to say that it has not progressed, both in quantity (meaning, accession to international conventions on PIL, as well as decisions on acceptance of accession of other countries), and in approach. When adopting new legal acts, in addition to resorting to laconic compatibility clauses, the EU legislature keeps an eye on being consistent with existing international conventions: Regulation 2019/1111 is a proof. A wish for judicial cooperation in civil and commercial matters appears in (some) agreements of a general scope, such as the Framework Agreement between the European Union and its member States, of the one part, and Australia, of the other part, in force since 22 October 2022: see its Article 32, comprising a specific mention to facilitating and encouraging the arbitral resolution of international civil and private commercial disputes.
That attention has been given to the civil prong of the European area of justice must be taken as good news.
Visiting the EU Parliament Legislative Train Schedule, the future looks not so promising. And yet there is much to do. There is definitely no PIL legislative overproduction in the Union; however, already with what exist it is easy to get lost.
One of the greatest difficulties in presenting European PIL as a true system to a third-State audience derives from the asymmetries of the instruments as regards geographical scope. The fact that there are several ‘Europes’ in Europe does not only impact on the practical manageability of the rules; it also jeopardizes declared valuable objectives, such as the concentration of closely related claims before the courts of a single Member State. This puzzling situation resulting from a variety of political motives affects above all family matters (in a large sense), but not only. The state of affairs is not likely to change any soon. For the future, the lawmaker should at least take care of making it visible. Sometimes he already does: because of the particular position of Denmark, Article 122, para 3, of the 2017 EU Trademark Regulation clarifies that reference to the Brussels regulation shall include, where appropriate, the Agreement between the European Community and the Kingdom of Denmark. Sometimes he does not: a provision similar to the one just referred to is missing in the GDPR.
Moving to the rules themselves, the newest ones on jurisdiction show an increasing degree of sophistication.
To ABILA I mentioned, by way of example, the provisions allowing for the limitation of proceedings (ad. ex., Article 13 of Regulation 2016/1103), which I see as a ‘distant cousin’ of the forum non conveniens doctrine. I also described the EU fora as being predictable, an assertion which was met with some skepticism in the panel. It is understandable. On paper, all grounds for jurisdiction in the European instruments obey to typical values (certainty, proximity) and reflect the outcome of balances (between the right of access to court of the claimant, and the right to a due process of defendant, with the necessary bias to protect one of the parties or to promote a particular substantive policy, as the case may be). In practice, reality beats the imagination of the legislator and puts the system continuously to a test.
Faced with a problem common to all legal systems, what still makes the European Union unique is the preliminary ruling mechanism (beyond the rightness or wrongfulness of the rulings: the Court can’t please everyone). Its very existence opens up the possibility of reacting to changes uniformly and in a relative short time. When requested by a national jurisdiction, no matter whether first instance, first or second appeal, the Court of Justice’s intervention to adjust the written rules or to shed light on their limits is not a choice – no certiorari.
In civil and commercial matters, the prototypical example of a need for constant adaptation are torts in the internet. Strings of requests for preliminary rulings get to Luxembourg based on variations of very similar facts, pushing the task of the Court of Justice to the verge of the distinction between interpretation and application of the European rules (see C-172/18, AMS Neve, and C-104/22, Lännen, as an example). That the workload of the Court does not decrease, but just the opposite, is to me a sign of trust and of good health of the system, thus an achievement.
In the area of enforcement there is much pending. The big European accomplishments in the last years remain confined to the free movement of titles from and to Member States. The (partial) abolition of exequatur, the possibility to ask for a European account preservation order, the availability of certificates and standards forms to ease and speed the application for enforcement in a country other than that of delivery of the judgement… benefit Member States’ decisions.
Creditors should be aware that the recent ruling of the Court of Justice in C-568/20, H Limited, does not open wide a door to titles from third States. In my reading of the Court’s decision (which may be wrong), the Brussels I bis Regulation is still limited to the recognition and enforcement in a Member State of decisions of other Member States. It applies, after a foreign judgement has been recognized, to the steps following said recognition, such as an order for payment (if adopted in full compliance with the conditions set forth in the EU regime). The entry into force of the 2019 Hague Convention, when it takes place, will ease the enforcement of non-European titles only to some extent. No doubt there is room for improvement.
I fail to see a difference for commercial arbitration in the pre- and post-Achmea scenarios (in this line, para 54 of C-284/16, resumed in C-741/19): at least, in theory. In any event, decisions such as C-700/20, London Steam-Ship Owners’ Mutual Insurance Association and earlier ones indicate that the main game is played elsewhere.
Among the many doctrinal suggestions for the recast of the Brussels I bis Regulation some focus on arbitration. Personally, I doubt the Commission wants to engage once again in the debate. Whatever the outcome of the ongoing revision of the Regulation, I presume Article 73, para 2, will remain. If this is so, a general line of reasoning of the Court regarding compatibility clauses is worth recalling: said clauses ‘cannot have a purport that conflicts with the principles underlying the legislation of which [they are] part’ (C‑533/08, TNT Express Nederland, at 51, and C- 452/12, Nipponkoa, at 37, on the relationship of the Brussels regime and the Convention on the Contract for the International Carriage of Goods by Road (CMR)). Difficult to imagine that Article 73 could constitute an exception in this regard, or the reasons why.
I did not have the time to present these thoughts in detail, nor other reflections regarding, among other, conflict of law rules. In exchange, I had the pleasure to listen to my two co-panelists on developments in the US and, quite intensively, in the already mentioned concerns of the arbitration world. A summary by S. Labi can be found in Oil-Gas-Energy-Mining-Infrastructure Dispute Management (OGEMID).