Interlocutory Decisions establishing Jurisdiction under the Brussels I bis Regulation

The author of this post is Lino Bernard, post-doctoral researcher at the University of Mainz, Germany. He developed the following thoughts in the course of his PhD thesis on parallel proceedings and jurisdiction agreements and has recently published a note on the preliminary reference of the German Federal Supreme Court in EuZW (European Journal of Business Law) 2025, p. 194 et seq.

As already announced on this blog, the German Federal Supreme Court has referred preliminary questions to the CJEU concerning the recognition of interlocutory decisions establishing jurisdiction under the Brussels I bis Regulation.

Although the questions are to be welcomed with respect to legal certainty, the answer proposed by the German Federal Supreme Court fails to convince.

Facts of the Case, National Proceedings and Preliminary Questions

Marta Requejo Isidro already concisely summarised the facts of the case and the national proceedings leading to the preliminary questions in a previous post.

In a nutshell:

A German company and a Spanish company concluded a contract containing an exclusive jurisdiction agreement in favour of a German court. The Spanish company instituted proceedings against the German company before a court in Madrid (Spain) concerning a payment the German company allegedly owed the Spanish company under the contract with regard to a bank guarantee that the German company called on. A few days later, the German company instituted proceedings against the Spanish company before the German regional court designated in the jurisdiction agreement, claiming that it had the right to call on the bank guarantee.

The Madrid court declared (without addressing the jurisdiction agreement in favour of the German court) that it had international jurisdiction but was lacking territorial competence and referred the case to a court in San Sebastián (Spain). The German company did not challenge the decision of the Madrid court but challenged the international jurisdiction before the San Sebastián court which rejected the challenge in an interlocutory decision with reference to the previous decision of the Madrid court.

The German court dismissed the action of the German company as inadmissible on the ground that (pursuant to Article 36 of the Brussels I bis Regulation) it had to recognise the interlocutory decision of the San Sebastián court. Following the German company’s appeal, the German appellate court set aside the judgment of the German regional court, finding that it had international jurisdiction despite the decision of the San Sebastián court. The Spanish company lodged an appeal against this decision before the German Federal Court of Justice, which has referred the following questions to the CJEU:

“1. Is the term ‘judgment’ in Article 36(1) of Regulation (EU) No 1215/2012 (1) (‘the Brussels I Regulation’) to be interpreted to the effect that the court of a Member State on which an agreement as referred to in Article 25 of the Brussels I Regulation confers exclusive jurisdiction (Article 31(2) of the Brussels I Regulation) must recognise a judgment by which a non-designated court of a Member State finds that the courts of that Member State have international jurisdiction if the judgment in question is an interim judgment, in other words, is not a decision which terminates a dispute?

2. If the answer to Question 1 is, in principle, in the affirmative: Does recognition of the interim judgment also depend on whether the interim judgment affirming the international jurisdiction of the courts of the Member State is binding on the non-designated court itself and/or whether the affirmation of international jurisdiction may be varied in the context of an appeal?“

Legal Background: Procedural Coordination under the Brussels I bis Regulation

The preliminary questions of the German Federal Court of Justice concern the coordination of parallel proceedings under the Brussels I bis Regulation.

Pursuant to its Article 31(2), this coordination is primarily linked to the alleged existence of an exclusive jurisdiction agreement. Only subsidiarily the coordination of proceedings is determined by the order in which they are instituted (Article 29(1)). Hence, if the court second seised is allegedly exclusively prorogated, the court first seised must stay its proceedings pursuant to Article 31(2) (unless it finds that there is not even the prima facie possibility of the existence of an exclusive jurisdiction agreement in favour of the court second seised, see, e.g., Hess et al., p. 32 et seq.; Bernard, p. 281 et seqq.).

Linking the coordination of parallel proceedings primarily to alleged exclusive jurisdiction agreements intends to prevent so-called torpedo actions (see, e.g., Bernard, p. 169 et seqq., 226 et seqq.). Prior to the introduction of Article 31(2)–(4), if, for example, a debtor anticipated an action by its creditor before a competent court, the debtor had the (unavoidable) possibility of frustrating the anticipated action by instituting negative declaratory proceedings before a court lacking jurisdiction but working in such an excessively slow manner that the (anticipated) action of the creditor before a competent court was blocked for a relevant amount of time. Article 31(2)–(4) serves to prevent this situation.

The case at hand concerns the situation in which the court first seised does (rightfully or wrongfully) not stay its proceedings pursuant to Article 31(2), resulting in parallel proceedings which need to be coordinated. The question at hand concerns the implications of an interlocutory decision of the court first seised by which it establishes its international jurisdiction (despite the alleged exclusive jurisdiction agreement in favour of the court second seised).

Does this decision bind the court second seised?

Preliminary Considerations: The Preliminary Questions

The German Federal Court of Justice has asked the CJEU if interlocutory decisions establishing jurisdiction must be recognised pursuant to Article 36(1). However, the matter, at least primarily, concerns the system of procedural coordination.

The question whether decisions on jurisdiction qualify (or should qualify) as recognisable decisions in the sense of Article 36(1) (Article 2(a)) is a complex issue that goes beyond the scope of this post (see, e.g., Bernard, p. 74 et seqq., 86 et seqq.). However, there is a simple argument that at least interlocutory decisions by which a court establishes jurisdiction do not, and should not, qualify as recognisable decisions: the system of procedural coordination, namely Article 29(3). It stipulates that “[w]here the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court.” In other words, the binding effect of an establishment of jurisdiction is explicitly codified. Therefore, any “recognition” of such decisions is neither necessary nor envisaged under the Brussels I bis Regulation (and would lead to systemic problems, see Bernard, p. 74 et seqq., 88 et seqq.).

The recognisability of interlocutory decisions establishing jurisdiction cannot be derived from Gothaer either. The CJEU imposed the recognition of decisions by which a court declines jurisdiction. This was, on a side note, not necessary either (since it is possible to apply the rationale of Article 29 to this situation), and leads to systemic problems as well (see Bernard, p. 104 et seqq.). However, the CJEU did not address interlocutory decisions by which a court establishes jurisdiction. The German Federal Court of Justice points this out as well in para. 29 of its decision.

There is also a good argument for distinguishing between decisions declining jurisdiction (terminating the dispute) and interlocutory decisions establishing jurisdiction in light of the above. While the Brussels I bis Regulation does not provide an explicit rule on the declination of jurisdiction (which is why the CJEU had to come up with some solution in Gothaer), it does provide a rule on the establishment of jurisdiction in Article 29(3), as noted above.

All this being said, it is understandable that the German Federal Court of Justice framed its preliminary questions with regard to Gothaer (addressing the recognisability). However, it should at least primarily have addressed the system of procedural coordination. The court should have asked the CJEU whether a binding effect of such decisions can be derived from the system of procedural coordination, namely Article 29(3), and if this binding effect also applies if the court second seised is allegedly exclusively prorogated and, therefore, generally entitled to conduct its proceedings pursuant to Article 31(2).

No Binding Effect of non-final (revocable) Interlocutory Decisions

The German Federal Court of Justice correctly states that a binding effect of a non‑final (revocable) interlocutory decision of the court first seised would lead to problems in the form of a negative conflict of jurisdiction. It would be possible that the proceedings instituted first are (in the end) dismissed for lack of jurisdiction after the proceedings instituted second have already been dismissed due to the jurisdiction of the court first seised.

At this point already, it becomes apparent that the matter concerns the system of procedural coordination: Specifically to avoid such a negative conflict of jurisdiction, Article 29(3) requires (in principle) that the jurisdiction of the court first seised is finally established (CJEU, C-1/13, para. 41 et seq.).

Binding Effect of final (irrevocable) Interlocutory Decisions

Regarding final (irrevocable) interlocutory decisions, the German Federal Court of Justice takes the view that such decisions do not have to be recognised by the court second seised (implicitly rejecting a binding effect in the sense of Article 29(3)). The German Federal Court of Justice argues that Article 31(2) permits the “prorogated” court to examine its own prorogation and that this would apply even if the court first seised has established its jurisdiction in a final interlocutory decision.

This argument is not convincing.

Indeed, Article 31(2) allows the court second seised and allegedly exclusively prorogated to conduct its proceedings. The purpose of this provision, however, is to prevent torpedo actions. In other words, the provision does not aim at establishing the priority of courts that are allegedly exclusively prorogated as a general rule (as an end in itself), but only to prevent torpedo actions. This already follows from the fact that the provision only applies once the court allegedly exclusively prorogated has been seised, allowing the court first seised until then to decide on its jurisdiction including its derogation. Moreover – following from the principle of mutual trust on which the Brussels I bis Regulation is based – any court must be regarded as equally competent to decide on the jurisdiction agreement. Also, there is no evidence that allegedly derogated courts generally decline jurisdiction. It is rather not unusual that contested jurisdiction agreements are found invalid (see, extensively, Bernard, p. 226 et seqq., p. 476 et seqq.).

Accordingly, neither the breach of an (alleged) exclusive jurisdiction agreement (CJEU, C‑90/22) nor the breach of the rules on lis pendens (CJEU, C-386/17) does constitute a ground for refusal of recognition. It is up to the parties to challenge incorrect decisions using the remedies of the lex fori (which is what the German company did not do regarding the decision of the Madrid court) and accept final (irrevocable) decisions.

Against this background, pursuant to Article 29(3) (which, contrary to Article 29 (1), does not refer to Article 31(2)) the court second seised must decline jurisdiction once the court first seised has finally established jurisdiction, even if the court second seised is allegedly exclusively prorogated.

Contrary to the remark of the German Federal Court of Justice, the party instituting the proceedings before the court second seised is in no way “exposed as before to a torpedo action”. The present situation is by no means a torpedo situation (in which an anticipated action before a competent court is blocked by instituting negative declaratory proceedings before an excessively slow-working court lacking jurisdiction). On the contrary, in the case at hand the court first seised has finally established jurisdiction. Precisely for this reason, the court second seised must decline jurisdiction pursuant to Article 29(3) (Bernard, p. 481 et seq.).

Lastly, the continuation of the proceedings before the court second seised would lead to parallel proceedings (which the system of procedural coordination is intended to prevent) if the court second seised were to consider itself exclusively prorogated. This is because the court first seised would not decline jurisdiction pursuant to Article 31(3) but conduct its proceedings because it has already finally established jurisdiction pursuant to Article 29(3) (Bernard, p. 482).

The Decision of the CJEU: A Possibility to ensure a legally certain Procedural Coordination

Considering the above, it is to be hoped that the CJEU will deny the recognisability of interlocutory decisions by which a court establishes jurisdiction (although the recognition would be preferable to no binding effect at all), while finding Article 29(3) to be applicable. The court second seised would be required to decline jurisdiction as soon as the court first seised has finally established jurisdiction. This would ensure a legally certain procedural coordination that is consistent with the objective of Article 31(2) – the prevention of torpedo actions – as well as the principle of mutual trust on which the Brussels I bis Regulation is founded.