Abstract
While private law as such has not yet been comprehensively harmonized on the EU level, this is—to a large degree—already the case for private international law. As these harmonized rules will cease to apply once the UK is not member of the Union any more, the Brexit will cause essential challenges when jurisdiction and applicable substantical law have to be determined for disputes between British and EU parties.
Consumer insolvency and consumer debt discharge are at present one of those fields where this harmonization has an especially significant impact, as the UK serves—based on the provisions of the European Insolvency Regulation—as a popular consumer insolvency tourism destination. This chapter analyzes the impact of Brexit on the UK’s and EU private international law on UK and European parties and exemplifies consequences and feasible options of handling these shortcomings by the phenomenon of UK-based consumer insolvency tourism.
Abstract
In most fields of law, the impact of the Brexit is alleviated by the fact that European law rarely does fade out completely even after the UK will have left the EU, as it „lives on“ in the implementations of European Directives in British law. This is different in these fields of law that are not mainly shaped by implemented directives (as it is the case for e.g. consumer law), but directly regulated by the EU in form of regulations. Still, the outcome is more complex than that, as also before harmonization by EU regulations the UK was bound by a multitude of conventions in the field of private international law, which were partly ratified before, partly after the UK’s accession to the European Economic Community. This chapter in a first step elucidates how essential individual parts of private international law will be regulated once UK law will not fall any more under the Brussels Regime. In a second step, practical consequences will be analyzed at the example of consumer insolvency tourism.
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Notes
- 1.
Regulation (EU) no. 1215/2012 of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast) OJ L 351.
- 2.
Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters, signed 27 September 1968, OJ L 299–232.
- 3.
A consolidated version of the Convention is accessible at [1998] OJ C 27/1.
- 4.
See more in the chapter by Schewe and Lipsens (2017).
- 5.
Regulation (EC) No 593/2008 of 17 June 2008 on the law applicable to contractual obligations (Rome I), OJ L 177/6.
- 6.
Convention 80/934/EEC on the law applicable to contractual obligations, concluded at Rome on 19 June 1980, [1980] OJ L266/1.
- 7.
The Regulation is slightly more comprehensive as also insurance issues are covered, just as well as foreign overriding mandatory rules have been treated differently.
- 8.
See also Dickinson (2016), p. 204.
- 9.
For details on the controversy see Lehmann and Zetzsche (2016).
- 10.
Regulation (EC) 864/2007 on the law applicable to non-contractual obligations, OJ L199/40.
- 11.
For background see O Lando, The EC Draft Convention on the Law Applicable to Contractual and Non-Contractual Obligations’, ibid p. 6.
- 12.
See e.g. Private International Law (Miscellaneous Provisions) Act 1995, sec 11(1).
- 13.
Regulation (EU) 2015/848 on insolvency proceedings (recast), OJ L 141/19.
- 14.
Also, foreign companies can be object of schemes of arrangement (1) if they have a ‘sufficiently close connection’ to the UK, (2) if there is beneficial effect of the scheme to be expected for the creditors, and (3) if at least one of the creditors falls directly under the UK jurisdiction. These criteria serve to interpret the central requirement for applying the UK law, being “liable to be wound up” as stated in 895(2)(b) Companies Act 2006. These three core requirements have been developed by British court practice already since Real Estate Development Co [1991] BCLC 210.
- 15.
For details on the German approach see Weller et al. (2016), p. 2382.
- 16.
Cross-Border Insolvency Regulations 2006, 2006 No. 1030.
- 17.
Insolvency Act 1986, 1986 c. 45.
- 18.
Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, OJ L 299/32.
- 19.
On the entire Convention 81/1068/EEC and its reception in detail see Kegel and Thieme (1988).
- 20.
European Council (2005), p. 39.
- 21.
For Norway and Estonia see Volens and Lilleholt (2016).
- 22.
- 23.
A more detailed overview see at Hoffmann (2012).
- 24.
Art. 13 EIR, 1346/2000/EC.
- 25.
C-341/04, Eurofood [2006] ECR I-3813, para 33.
- 26.
ECJ, case Interedil Srl (in liquidation) v Fallimento Interedil Srl, C-396/09; [2011].
- 27.
ECJ, Interedil C-396/09; [2011], operative part of the judgment, III.
- 28.
C-I/04 [2006], ECR I-701.
- 29.
Official Receiver vs. Eichler [2007], BPIR 1636.
- 30.
BPIR 1636, p. 12.
- 31.
See e.g. “London risks becoming “brothel” for bankruptcy tourists”, The Guardian, 31 Jan 2010.
- 32.
For further information concerning firms acting in Germany see Hergenröder (2009), p. 310.
- 33.
ECJ, case Emsland-Stärke, C-110/99 [2000], ECR 1-11569, par. 39.
- 34.
Disagreeing D’Avoine (2011), p. 312, who assumes an abuse of the EIR in cases of obvious “return option” of the debtor.
- 35.
C-212/1997 [1999] ECR1-1459, p. 27.
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Hoffmann, T. (2018). The Brexit and Private International Law: An Outlook from the Consumer Insolvency Perspective. In: Ramiro Troitiño, D., Kerikmäe, T., Chochia, A. (eds) Brexit. Springer, Cham. https://doi.org/10.1007/978-3-319-73414-9_14
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