Unilateral Jurisdiction Agreements In Europe

European courts have taken different positions on whether or not such “unilateral or asymmetrical” instance agreements are valid. While common law courts regularly accept such agreements as legitimate and enforceable, other courts, particularly the French courts, have refused to be valid. [2] One of the most discussed decisions in this regard is the judgment of the French Court of Cassation in the Rothschild case [3] concerning a dispute between a French national residing in Spain and a Rothschild Group bank in Luxembourg. The jurisdiction agreement in question provided for the exclusive jurisdiction of the national courts in Luxembourg, but granted the bank the right to bring an action “at the customer`s domicile or before any other competent court”. [4] The French Court of Cassation repeals the jurisdiction clause and argued that it violated “the object and purpose of the jurisdiction agreement of Article 23 of the [Brussels] Regulation”. [5] In a 2015 decision, the French Supreme Court again ruled that unilateral jurisdiction clauses are not applicable. The decision was taken in the framework of the Lugano Convention, which defines competence between eu Member States and Switzerland, Norway and Iceland, but which, as far as possible, is identical to the Brussels I Regulation. In a very brief judgment, the Court followed its earlier decision of 2012. The Court criticised the Court of Appeal for failing to examine the extent to which the imbalance was contrary to the objectives of foreseeability and legal certainty set out in Article 23 of the Lugano Convention. The case is judged again, the new decision, which will be rendered by the new Court of Appeal, can itself be challenged again before the Court of Cassation.

This recent ruling is clear, although there is still a lot of uncertainty. For example, the judgment does not concern consumer protection (the dispute concerns an international financing agreement), but more generally the prohibition of unbalanced terms, regardless of the status of the contracting parties. However, it is not certain that forms of asymmetry are prohibited or that a more restricted form of unilateral option can be maintained. An example could be to offer the bank, but not the borrower or guarantor, the possibility of bringing an action either at the place of performance or in the courts of its own country of origin. Recommendations: As stated above, there are strong political reasons to maintain unilateral jurisdiction clauses. [1] Mary Keyesa and Brooke Adele Marshallb, “Jurisdiction agreements: exclusive, optional and asymmetric” (2015) 11/3 Journal of Private International Law 345-378, 345. Contractual agreements in international trade are governed by the principle of party autonomy. The general possibility for the parties to agree on the competent court for any disputes arising out of or in connection with the agreement in question may be regarded as an integral part of this principle. The agreement in question between the parties could include, for example, the (exclusive) jurisdiction of different national courts for different types of dispute or unilateral optional agreements allowing a party to choose jurisdiction. [1] Whether or not such particular agreements can be considered valid has been regularly the subject of controversy. . .