This Convention does not encompass several key areas, including the status and legal capacity of individuals, maintenance obligations, family law issues such as matrimonial property regimes, wills and succession, insolvency matters, and the carriage of passengers and goods Additionally, it excludes topics related to marine pollution, liability for nuclear damage, the validity of legal entities and their decisions, public register entries, and defamation.
Judgments are still covered by this Convention even if they involve matters excluded under paragraph 1, as long as those matters were only preliminary questions in the proceedings Specifically, if an excluded matter was raised as a defense and not as the main focus of the case, it does not disqualify the judgment from the Convention's scope.
3 This Convention shall not apply to arbitration and related proceedings
4 This Convention shall not apply to agreements to refer a dispute to binding determination by a person or body other than a court, or to proceedings pursuant to such an agreement
Under this Convention, a judgment remains valid even if a State, its government, a governmental agency, or any representative of the State was involved in the legal proceedings.
6 Nothing in this Convention shall affect privileges and immunities of States or of international organisations, in respect of themselves and of their property
Extent of exclusions from scope of application of the Convention
The IBA Litigation Survey revealed that over 65% of respondents supported the proposed exclusions; however, nearly 65% opposed the exclusion related to the carriage of passengers and goods (Art 2(1)(f)) Additionally, almost 50% disagreed with excluding issues concerning the validity, nullity, or dissolution of legal entities and the validity of their decisions (Art 2(1)(i)), as well as the exclusion of defamation cases (Art 2(1)(k)).
1 We share the opinion of the Surveyed persons and consider that the carriage of passengers and goods should not be excluded from the scope of the
The rationale for excluding certain provisions from the Convention is to prevent potential conflicts with existing agreements, such as the 1974 Athens Convention for the Carriage of Passengers and their Luggage by Sea and the 1973 Convention on the Contract for the International Carriage of Passengers and Luggage by Road While these conventions include important rules on recognition and enforcement, they have limited state participation Therefore, implementing a disconnection clause within the Convention would be more suitable, ensuring that its broader rules do not contradict the specific provisions of previously established agreements that individual States have adopted.
Article 2(2)(m) of The Hague 2005 Choice of Court establishes that the validity, nullity, or dissolution of legal persons or associations, as well as the validity of decisions made by their governing bodies, is explicitly excluded from its provisions.
According to the Explanatory Notes in the Preliminary Document No 2 from April 2016, the exclusion outlined in paragraph 37 is justified, emphasizing the rationale behind the decision presented to the Special Commission in June 2016.
The concept of "personhood" for legal entities is subject to stringent regulations that differ significantly across jurisdictions Typically, this regulation is governed by the laws of the jurisdiction where the entity is incorporated, granting local courts exclusive authority over issues such as the validity of constitutions, nullity, or dissolution of companies This close relationship between jurisdiction and legal personhood was a key factor in the decision to exclude these matters from The Hague 2005 Choice of Court Convention, as it was deemed inappropriate to transfer such issues—often involving third-party rights—away from the courts with the most relevant jurisdiction.
The exclusive jurisdiction of the courts where legal persons are seated is vital for ensuring efficiency in legal matters Therefore, judgments from these courts should be recognized and allowed to circulate widely, warranting their inclusion under the Convention's scope.
Defamation cases are excluded from the Convention due to their sensitive nature, which intersects with freedom of expression and may have constitutional implications The working group acknowledges that what constitutes defamation varies significantly between states, influenced by cultural differences Including such cases could result in the recognition and enforcement of foreign judgments that conflict with local sensibilities, without necessarily violating public policy, which is an undesirable outcome.
It is essential to include judgments regarding the "carriage of passengers and goods" while considering a disconnection clause to reduce the risks of overlaps and contradictions with existing international conventions.
Judgments concerning the validity, nullity, or dissolution of legal entities, whether they are associations of natural or legal persons, as well as the validity of decisions made by their governing bodies, should be included and not excluded.
In this Convention, the term "defendant" refers to an individual against whom a claim or counterclaim has been filed in the State of origin The term "judgment" encompasses any court decision regarding the merits of a case, regardless of its designation, including decrees or orders, as well as determinations of costs or expenses by the court or its officers, provided these decisions can be recognized or enforced under this Convention It is important to note that interim measures of protection do not qualify as judgments.
An entity or individual, excluding natural persons, is deemed to be habitually resident in a State if it meets any of the following criteria: it has its statutory seat in that State, it was incorporated or formed under the laws of that State, it maintains its central administration there, or it operates its principal place of business within the State.
The scope of subparagraph (1)(b) should be further clarified;
Subparagraph (1)(b) requires clarification regarding intellectual property (IP) issues, specifically highlighting the authority of the Comptroller-General of Patents, Designs and Trade Marks, who oversees patent infringement and validity in the UK Additionally, the European Union Intellectual Property Office holds the power to assess the validity of European Union Trade Marks and Community Designs, raising concerns that the draft Convention may inadvertently omit these critical decisions.
Uncertainty regarding the use and definition of the “habitually resident” criterion
A judgment issued by a court in one Contracting State (the State of origin) will be recognized and enforced in another Contracting State (the requested State) as outlined in this Chapter The recognition or enforcement of such judgments can only be denied based on the specific grounds established in this Convention.
The provisions of this Chapter allow for necessary reviews, but they do not permit a review of the merits of the original court's judgment.
3 A judgment shall be recognised only if it has effect in the State of origin, and shall be enforced only if it is enforceable in the State of origin
If a judgment is under review in its State of origin or if the deadline for ordinary review has not lapsed, the addressed court may choose to recognize or enforce the judgment, potentially requiring security as a condition; alternatively, it may decide to postpone the recognition or enforcement, or it may refuse to recognize or enforce the judgment altogether.
A refusal under sub-paragraph c) does not prevent a subsequent application for recognition or enforcement of the judgment” (emphasis added on commented provisions)
Article 4.3: Ambiguity of the term “has effect”;
Article 4.4: Definition of the notion of “ordinary review”;
Article 4.4.c: Different meanings of the term “refusal” in Articles 4 and 7.
1 The use of the wording “has effect” in Article 4.3, has, in our opinion, no precise legal meaning and might, therefore, be a source of confusion between
In the context of the Convention, the term "future Members" refers to judgments that may be binding and effective even if not enforceable under certain legal systems We believe such judgments should be included within the Convention's scope However, we recommend replacing the phrase "has effect" with "legally binding," as this terminology conveys a stronger meaning while still permitting the recognition of legally binding judgments that are not yet enforceable.
In Article 4.4, the distinction between “review” and “ordinary review” is significant, as it grants judges in the Requested State the authority to either recognize, conditionally grant, postpone, or deny the enforcement of a foreign judgment Currently, while any ongoing review of the foreign judgment in the State of Origin allows the Requested State's judge to make these determinations, only the absence of a time limit for seeking an ordinary review in the State of Origin provides the same authority It's important to note that in certain legal systems, extraordinary reviews may not be bound by time limits or restrictions, impacting the judge's options in the Requested State.
It is essential to maintain the distinction between "review" and "ordinary review" in the clause, as omitting "ordinary review" could allow the judge in the Requested State to apply one of the four options at any time Therefore, we recommend that the draft provision remain unchanged Additionally, we suggest defining what constitutes an "ordinary review" within the Draft Convention, potentially in Article 3, which should include a list of applicable definitions.
The term "refusal" in Articles 4 and 7 has been a topic of significant discussion among experts, particularly during the Judgments Project meeting in June 2016 According to the meeting minutes, the refusal of recognition and enforcement outlined in these articles differs in nature Specifically, the refusal in Article 4 should not be viewed as a definitive rejection, as it allows for the possibility of a subsequent application for recognition and enforcement after the State of Origin has addressed the appeal In contrast, the refusal in Article 7 is deemed definitive, as it pertains to substantive reasons—such as fraud or public policy—that justify a requested State's decision to deny recognition and enforcement.
At the June meeting, experts debated the use of the term "refusal" in the Draft Convention, suggesting it be replaced with "dismissal" in Article 4 to clarify related concepts However, an EU expert highlighted that "refusal" is already utilized in both contexts within the 2005 Choice of Court Convention, potentially mitigating concerns over duplication While substituting "dismissal" could differentiate the implications of refusals in Article 4.4 and Article 7, it may introduce ambiguity regarding the nature of a "dismissal," as interpretations vary across jurisdictions, particularly concerning whether it is with or without prejudice Ultimately, the EU expert's position appears more favorable, provided it is clearly stated that a refusal under subparagraph (c) does not hinder subsequent applications, as noted in Article 4.4.
Therefore, we agree that the use of the word "refusal" in the Draft Convention should correspond with the wording of Art 8(4) of the 2005 Choice of Court Convention
Article 4.3: Clarification of the term “has effect”, it might be replaced by
Article 4.4: Definition of the term “ordinary review” in Article 3 of the Draft Convention;
Article 4.4.c: We agree that the word “refusal” should not be replaced by the term “dismissal”.
ARTICLE 5(1)(e) Article 5 – Bases for recognition and enforcement
1 A judgment is eligible for recognition and enforcement if one of the following requirements is met -
[e) the defendant expressly consented to the jurisdiction of the court of origin in the course of the proceedings in which the judgment was given];
When seeking recognition or enforcement against an individual acting primarily for personal, family, or household purposes, such as a consumer in a consumer contract or an employee regarding their employment contract, it is essential to note that consent must be obtained prior to the court proceedings, as stipulated in sub-paragraph 1(e).
What is “in the course of the proceedings”?
The consumer/employee exception aims to protect weaker parties from inadvertently “consenting” to jurisdiction in a state.
In certain states, collective employment contracts are in place, addressing concerns related to bargaining power that typically arise with individual employment or consumer contracts Notably, the exception has been revised to pertain solely to individual employment contracts.
Article 5(1)(e) stands for the proposition that when a defendant has expressly agreed that a court of origin has jurisdiction over it, the defendant should not later
19 challenge that court’s jurisdiction when the opposing party seeks to enforce the judgment of the court of origin against the defendant in a Contracting State
The concept of "express consent" in legal proceedings may appear simple, yet its interpretation varies significantly among attorneys across different states While some legal professionals argue that appearing in court without disputing its jurisdiction constitutes "express consent," others hold a differing view This discrepancy highlights the need for clarification regarding the consistent application of this provision.
Incorporating a definition of "express consent" into Article 3 would clarify existing disagreements by narrowly defining the term This approach enables the Convention to distinctly address instances of tacit assent, with appropriate qualifications For instance, proposed Article 5, Section 1(f) recognizes situations that some legal traditions may interpret as tacit assent, allowing it to serve as a basis for the recognition of judgments under specific conditions, such as when the defendant had the opportunity to contest jurisdiction and presented a valid argument against it based on the originating state's laws.
Defining "in the course of the proceedings" can help eliminate confusion and provide courts with clear guidelines for applying Article 5, Section 1(e) This limitation ensures that express consent to jurisdiction is both knowing and voluntary, as defendants should be aware of the claims they are consenting to litigate By requiring consent to be given during the proceedings, it prevents potential manipulation where a prospective plaintiff might coerce a party into agreeing to jurisdiction through tactics like clickwrap agreements before any legal action is initiated.
The Judgments Project Working Group has proposed two definitions for the time period in which express consent should lead to the recognition of a judgment The first definition considers the moment of service as the starting point, as defendants are legally notified of claims at that time However, a member of the Working Group highlighted that in certain countries, defendants might have prior actual knowledge of court proceedings against them through notifications from their court agents, even before the formal service occurs.
2 Although both terms appear only in Article 5, defining them in that Article would make the list of jurisdictional filters confusing Thus, the definitions should be added to Article 3
The second definition indicates that the filing moment marks the start of the time period During the June 2016 Meeting of the Judgments Project, delegates raised concerns about Article 5, Section 1(e), specifically regarding the requirement for express consent to occur "in the course of the proceedings" in relation to the 2005 Choice of Court Convention.