The Conflict of Laws

The term "framework of European private international law" covers all EU instruments in force, dealing with the problem of jurisdiction, applicable law, recognition and enforcement of law, foreign judgments and authentic instruments. Private international law has traditionally been, and in part still is, a matter of national law. Each state has its own rules to deal with jurisdiction, applicable law, recognition and enforcement of foreign judgments. Europe has an interest in matters of private international law since the 1957 Treaty on the European Economic Community. The Treaty of Amsterdam 1997 introduced the broader concept of judicial cooperation and brought three core issues of private international law into the field of the European Community. The three core issues are now found in Article 81 (2) (a) and (c), Treaty on the Functioning of the European Union. This paper suggests a road map towards a more comprehensive codification of EU private international law. At the moment, legislative efforts should be directed to the creation of special instruments for well-defined problems in European private international law. The fruits of these efforts can be long-lasting if they are combined into a code of EU private international law. The content of recent national codifications can help identify current gaps within the EU framework. Motives for national legislatures to codify private international law are also relevant for EU legislatures. A brief comparison is made of three recent codifications: Belgium, Holland and Poland. The Belgian codification contains rules on jurisdiction as well as on enforcement and recognition, while the Dutch and Polish laws decided to limit the DNPE legislation on choice of law rules. A typical characteristic of national codifications of private international law is that they may contain rules on the principles of private international law, or general provisions of private international law. Motives for codification vary, from a desire to increase transparency and make the rules adopt an open and international approach, to a desire to make the rules more easily accessible to legal practitioners. Private international law is also influenced by developments within the internal (national) framework. New rules of private international law will be necessary to adapt to the new legal institutions of national systems. Another way in which developments in substantive law can change private international law is that values considered important at the national level find their way into private international law. Private international rules that provide additional protection for employees and consumers serve as an example of this process. The gaps in the current framework can be divided into three main categories. First, loopholes which are the desired result of territorial limitations to the scope of EU legislation. Second, systemic gaps occur when the current framework is compared to those particular problems that, taken together, constitute the traditional problems of private international law. The current framework fixes most of these particular problems, but not all. Thirdly and finally, there are shortcomings when EU legislation provides for those certain questions that are deliberately left out of the scope of an accession instrument, even though from a systematic perspective these questions are part of the matter regulated in the instrument, e.g. . contractual obligations. In addition to these three main categories, it should be noted that as a result of various factors, the community instrument may contain rules that refer to notions which by their nature are open to interpretation. For the time being these open notions are best left to the case law or legal writing to determine their meaning. The truly necessary insertions would address the gaps that have been defined as 'systematic' omissions, as there is no rule that can be applied. The lack of harmonized or unified rules has an immediate effect on citizens and businesses in the EU. In the discussion on the codification of private international law, attention should be paid to the differences between the national concept and the 'codification' of European private international law. In principle, it means a procedure by which the acts to be codified are repealed and replaced by a single act that does not contain substantial changes in those acts (Interinstitutional Agreement of December 20, 1994, point 1). An important aspect of codification at the EU level is the reduction of the volume of legislation. The EU legislature could consider dividing its attention and efforts into three separate areas of private international law that fall within the framework: civil procedure, civil and commercial cases in general (an almost complete area); choice of law (applicable law) in non-family cases (raising issues that have a strong connection with the internal market); private international law for family law cases (which will require unanimity in the Council). Directing its attention to these specific areas can assist the European legislature in progressing the completion of this framework.

This chapter describes Guatemalan perspectives on the Hague Principles. In Guatemala, the sources of Private International Law for international commercial contracts are: (i) international treaties, comprised of: the Convention on Private International Law (Bustamante Code) and the Inter-American Convention on General Rules of Private International Law (Second Inter-American Specialized Conference on Private International Law); and (ii) national laws. In general terms, the Guatemalan private international law regime applicable to international commercial contracts recognizes the ability of parties to a contract to choose the applicable law. Notwithstanding, important differences deriving from such regime may apply, and will ultimately depend on the type of dispute resolution mechanism the parties are using: litigation or arbitration. Currently, there are no on-going revisions or proposed revisions of the Guatemalan national laws or international treaties that provide rules of private international law for international commercial contracts. In the event that the rules of private international law would be revised, the Hague Principles could play a role, as they facilitate the legislative body’s task of creating a new statute and put forward the most advanced developments in the matter. For this to happen, however, the Hague Principles should be disseminated and made available and known to all relevant parties.

PurposeThis paper aims to explore the role of public and private international law and how they are used differently in regulation of global markets. Data were sourced from both primary and secondary materials – journal papers, court decisions, textbooks and international legal instruments to gain insights into the role of law and the varied contexts in which it is used in regulation of markets. In an ordinary sense of the word, law sets operational limits to protect normative values and practices in a state – trade, peace, security, just to mention but a few. However, law cannot be confined to deterring undesired behaviours or to settling disputes, but more importantly, a good law should prevent disputes from happening. Law dictates the way of life of a society and its efficacy often depends on how well it is used to order the proper functioning of the system. International law is the set of rules which govern and foster effective relations of states. The paper explores the chasm between public and private international law, with a view to demonstrate how they are used differently in regulation of markets. Public and private international law encompass norms evolved by multilateral treaties, customs, judicial decisions, model laws and soft law instruments by different oversight bodies governing states and other stakeholders in their relationship with each other. These norms/rules create a platform for interstate cooperation on varied regulatory issues of shared interests. While treaties create a uniform framework of rules in all signatory states, their implementation often depends on individual states willingness to transpose them into national law. Owing to the inherent challenges of public international law (interstate practice), it has become imperative for markets to use rules of private international law. While public regulates the relationship of states and their emanation, private international law helps to bridge gaps in the mainstream international legal systems of states and in so doing enhances their co-existence on overlapping regulatory issues. The engendered trans-national norms will over time generate a positive impact on local sustainability and co-existence of different regulatory domains.Design/methodology/approachThis paper uses cases studies and experiences of countries to demonstrate the complimentary relationship of public and private international law and how they work in tandem in international legal practice. The paper has also used the varied experiences of states to demonstrate how public and private international law interact in regulation of global markets. Data were sourced from both primary and secondary sources – journal papers, court decisions, textbooks and international legal instruments – to gain insights into the law and the varied contexts in regulation of markets. The case law and experience of states alluded to undertaking this research reflect the complimentary relationship of states for markets to operate effectively.FindingsThe findings of the paper comport with the hypothesis that markets cannot effectively work unless they are pursued within the framework of rules of public and private international law. The paper has alluded to the experience in national jurisdictions and global to highlight the chasm between different regulatory domains for markets to operate effectively. The paper articulates important practical issues relating to public and private international law in regulations of markets.Research limitations/implicationsThe practical implication of the paper is that it underscores significant legal issues relating to regulation of markets drawing examples within national jurisdictions and globally.Social implicationsThe paper has social implications because markets affect people, jobs and social life in varied ways. It addresses pertinent issues related to the complementarity of public and private international law and how they are manifested in national jurisdictions.Originality/valueThe paper is original because it nuances the interrelationship of public and private international law, teasing out their interaction in regulation of global markets in a distinctive way.

Lex Rei Sitae in Perspective: National Developments of a Common Rule?

The article analyses three basic models that can be applied to determine the relationship between the proposed Common European Sales Law (CESL) and the rules of private international law: the ‘28th regime-model’, the ‘2nd regimemodel’, and the '1st regime-model’. It argues that both the '28th regime-model’ and the model favoured by the European Commission, the ‘2nd regime-model’, endanger the overall objective of the CESL because Article 6 Rome IRegulation will continue to apply. The '1st regime-model', in contrast, avoids application of Article 6 Rome I-Regulation because it classifies the CESL as a uniform law that takes precedence over the rules of private international law. The article, therefore, concludes that the European Commission should rethink its position and apply the '1st regime-model’ instead of the ‘2nd regime-model’.

Lex Rei Sitae and the EU Internal Market - Towards Mutual Recognition of Property Relations

The following contribution builds on the Swiss experience in order to reflect on the idea of codifying private international law in the EU. The Swiss Federal Act on Private International Law with its 225 articles is possibly the most complete codification of private international law (PIL) worldwide. It covers jurisdiction, international civil procedure, applicable law, and the recognition and enforcement of foreign judgments. It represents therefore a comprehensive codification of PIL. This contribution argues that having a comprehensive PIL codification has numerous advantages when compared with having PIL rules distributed over a large number of separate acts or regulations. A comprehensive codification makes all PIL rules readily accessible in one place, helps to avoid friction between the rules on jurisdiction on the one hand and applicable law on the other, promotes a uniform view of the whole matter, favours clarity and coherence between the different sets of rules, reduces complexity, increases legal certainty, and considerably adds to the user-friendliness of the rules on PIL. Based on these findings, the author recommends the commencement of preparatory work for the enactment of a comprehensive PIL regulation in the EU.

This book is the leading reference on Cambodian private international law in English. The chapters systematically cover the whole of Cambodian private international law, including commercial matters, family law, succession, intellectual property, competition (antitrust), and environmental disputes. The chapters do not merely cover the traditional conflict of law areas of jurisdiction, applicable law (choice of law) and enforcement. They also look into conflict of law questions arising in arbitration and assess Cambodia’s involvement in the harmonisation of private international law globally and regionally within the Association of Southeast Asian Nations (ASEAN). Similarly to the other volumes in theStudies in Private International Law - Asiaseries, this book presents the Cambodian conflict of laws through a combination of common and civil law analytical techniques and perspectives, providing readers worldwide with a more profound and comprehensive understanding of the subject.

Cases involving the posting of workers will inevitably involve international elements and therefore issues of private international law. Historically, it has been assumed that English employment law is territorial: in particular section 204 of the Employment Rights Act 1996 provides that the provisions of the Act apply irrespective of the law applicable to the contract. This contribution examines this proposition through the perspective of private international law principles, and also considers the compatibility of section 204 with the private international law rules in the Posted Workers Directive and the new definition of overriding mandatory rules in the Rome I Regulation.

The reliance on constitutional identity by EU courts and governments has been widely discussed in legal scholarship, but less attention has been devoted to the impact of constitutional identity-based arguments on the evolution of judicial cooperation in civil matters. Member States have increasingly relied on constitutional identity in the area of private international law to claim the application of their own law or reject the recognition of foreign situations. Constitutional identity can be invoked through the public policy exception, to avoid the normal operation of private international law rules. Member States can also refer to constitutional identity when staying outside the adoption of EU private international law rules, especially regarding family law. Constitutional identity can thus impede judicial cooperation in civil matters and contribute to the fragmentation of EU private international law. Constitutional identity does not grant unfettered freedom to Member States, however. The autonomous private international law rules of the Member States must respect EU fundamental principles if the situation demonstrates some connection to EU law and the public international law obligations assumed by the Member State concerned.

This article begins by supplementing the existing criticism which rejects the recognition of lex petrolea as an autonomous system of law. It then proceeds to discuss the practical application of lex petrolea as ‘substantive law’ in international arbitration disputes. This is inspected through the lens of international and comparative law, although sections of the article focus specifically on English law. The author presents three practical conclusions. First, although parties to an arbitration may elect the rules of lex mercatoria and (by analogy) lex petrolea to govern the merits of their dispute under the lex arbitri of most Civil Law European jurisdictions, this is not possible in England under the Arbitration Act 1996. Secondly, an arbitrator may not disapply the parties’ choice of substantive law and instead resolve the dispute through the application of lex petrolea. Such a decision will likely result in the annulment of the award. Thirdly, awards relating to petroleum disputes are incapable of creating binding precedent and therefore do not create indissoluble rules of private international law. Moreover, proponents of lex petrolea such as Bishop and Childs have failed to identify any novel rules of customary international law through their doctrinal study of petroleum related arbitral awards.

In his seminal workThe Multinational Challenge to Corporation LawProfessor Phillip Blumberg assets that, “jurisdiction continues to be one of the most litigated areas involving the clash of enterprise and entity.”1Indeed, in a world where business is increasingly conducted through the medium of economically integrated multinational enterprises (MNEs), the question of whether a forum has jurisdiction over disputes arising out of the operations of non-resident entities of the MNE brings into contrast the mismatch between the territorial reach of the legal system and the transnational reach of the enterprise. In terms of corporation law this raises the further matter of whether, and how far, the legal organisation of the MNE into distinct legal entities, in distinct legal jurisdictions, should affect the applicable rules of private international law as to the reach and scope of forum jurisdiction. Such issues have recently been aired before the English courts in a series of cases, arising out of the asbestos mining and milling operations of the British based MNE Cape plc in South Africa, which culminated in a judgment given by the House of Lords on 20 July 2000. It is the purpose of this paper to explore the issues of jurisdiction over non-resident entities of MNEs, first, through an examination of these cases in the light of Cape's industrial and management structure. It is striking how little such matters are addressed in the Anglo-American legal literature pertaining to private international law. Rather than considering the economic realities of the cases in issue, and developing new doctrines to deal with them, lawyers have tended to rely on legal concepts—in particular, the territorial nature of legal jurisdiction and the single unit corporate form—to lead them to often unsatisfactory results that would appear to a lay person not to accord with justice. A clearer understanding of the economic realities of group operations thus seems essential for the development of law in this area.

Bank resolution is key to avoiding a repetition of the global financial crisis, where failing financial institutions had to be bailed out with taxpayers’ money. It permits recapitalizing banks or alternatively winding them down in an orderly fashion without creating systemic risk. Resolution measures, however, suffer from structural weakness. They are taken by States with territorially limited powers, yet they concern entities or groups with global activities and assets in many countries. Under traditional rules of private international law, these activities and assets are governed by the law of other States, which is beyond the remit of the State undertaking the resolution. This paper illustrates the conflict between resolution and private international law by taking the example of the European Union, where the limitations of cross-border issues are most acute. It explains the techniques and mechanisms provided in the Bank Resolution and Recovery Directive (BRRD) and the Single Resolution Mechanism (SRM) Regulation to make resolution measures effective in intra-Eurozone cases, in intra-EU conflicts with non-Euro Member States and in relation to third States. However, it also shows divergences in the BRRD's transposition into national law and flaws that have been uncovered through first cases decided by national courts. A brief overview of third country regimes furthermore highlights the problems in obtaining recognition of EU resolution measures abroad. This article argues that regulatory cooperation alone is insufficient to overcome these shortcomings. It stresses that the effectiveness of resolution will ultimately depend on the courts. Therefore, mere soft law principles of regulatory cooperation are insufficient. A more stable and uniform text on resolution is required, which could take the form of a legislative guide or, ideally, of a model law. It is submitted that such a text could pave the way for greater effectiveness of cross-border resolution.

The paper examines the problems with respect to the application of the UN Sales Convention (CISG) by virtue of its Article 1(1)(b). To that effect, the author analyzes the legal nature of this provision, describes the prerequisites for its application and explains the relevance of different rules of private international law for the application of the CISG. A special attention is given to the effects of Article 95 reservation. The author presents arguments against a widely spread opinion that the Article 1(1)(b) is in itself a conflict-of-laws rule, suggests that this provision is suitable to be applied both by courts and arbitral tribunals and explains the importance of the rules on classification and renvoi for the application of the CISG. With respect to the effect of Article 95 reservation, the author gives precedence to the position of the applicable law, rather than the law of the forum, concerning this reservation.

Abstract: The question of the legal nature of the so-called country of origin principle in Article 3 of the EC E-commerce Directive causes great confusion. Many, including e-service providers, advocate that the provision should be understood as a choice of law rule designating the law of the place of establishment of the service provider as applicable. However, Article 1(4) of the Directive explicitly states that no additional rules of private international law are created. Is there a conflict within the Directive or can such a conflict be avoided? There are basically three ways in which the country of origin principle could be understood: (i) the E-commerce Directive establishes a choice of law rule for the law applicable to e-commerce services, irrespective of the provision in Article 1(4); (ii) the country of origin principle of the E-commerce Directive only sets out certain limitations to the application of the designated law; (iii) the Directive makes the rules of the home country of the service provider internationally mandatory and thus applicable irrespective of what law is applicable to the contract or tort etc. This article analyses the three alternatives and advocates the last solution as the one which is not only line with the legislative intent but also permits the Directive to maintain logical coherence.