he Official Journal of the European Union of 14th July 2022 published the Council Decision (EU) of 12th July 2022 concerning the accession of the European Union to the Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (hereinafter referred to as the “Convention”).
The Convention has the objective of facilitating commerce and multilateral investment through judicial cooperation, reinforcing said judgments with common regulations regarding the recognition and enforcement thereof and obtaining greater legal security.
The scope of the convention shall apply to the recognition and enforcement of judgments in civil or commercial matters, excluding revenue, customs or administrative matters. It does include judicial transactions with enforceability in the State of origin.
“Judgment” is deemed to be any decision relating to the merits, including court orders and judgements, and also the determination of costs and expenses related to a judgment.
A considerable amount of matters are excluded, both in relation with natural persons (status and capacity, wills, succession, maintenance obligations and family law matters), insolvency, transport (of both persons and goods), transboundary marine pollution, liability for nuclear damage, legal entities (validity, nullity, or dissolution of such, and the validity of the decisions of their organs, the validity of entries in public registers, intellectual property, anti-trust (competition) matters, arbitration and processes related thereto and the State (activities of armed forces and law enforcement and sovereign debt restructuring through unilateral State measures), precautionary and provisional measures.
Under the possibility of not applying the Convention to certain matters, the European Union has stated that it will not apply the Convention to lease contracts concerning non-residential real estate located in the European Union.
It establishes the following general principles:
(i) a judgment given by a court of a State of origin shall be recognised and enforced in the requested State. There shall be no review of the merits of the judgment in the requested State;
(ii) 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;
(iii) recognition or enforcement may be postponed or refused if the judgment is the subject of review in the State of origin, without prejudice to a possible subsequent claim for the recognition or enforcement thereof.
The bases are:
a) the person against whom recognition or enforcement is sought was habitually resident in the State of origin at the time that person became a party to the proceedings in the court of origin;
b) the defendant maintained a branch, agency, or other establishment in the State of origin and the claim on which the judgment is based arose out of the activities thereof;
c) the defendant expressly or tacitly consented to the jurisdiction of the court of the State of origin;
d) the judgment deals with:
(i) a lease of immovable property and it was given by a court of the State in which the property is situated;
(ii) a contractual obligation secured by a right in rem in the State of origin;
(iii) a non-contractual obligation arising from death or damage, and the act occurred in the State of origin. It contains special regulations on trusts, counterclaims, against consumers and/or employees. The exclusion of judgments on leases of immovable property for residential purposes is noteworthy and on the registration of real estate property, unless they have been passed by a court of the State wherein said property are located.
The judgments regarding rights in rem on immovable property shall only be recognised and enforced if the property is found in the State of origin.
The causes for refusal are related to: the violation of the right to defence of the defendant; the notification of the defendant was carried out in a manner not compatible with the fundamental principles of the service of documents of the requested State; the existence of fraudulent judgments or those contrary to the public policy of the requested State or incompatible with others passed by the court of the requested state between the same parties; compensation for damages that do not compensate a party for actual loss or damage suffered. Refusal shall not preclude a subsequent claim.
The documentation to be provided shall consist of:
(i) certified copy of the judgment;
(ii) accreditation of the notification to the defaulting party;
(iii) proof of the effects of the judgment in the State of origin; and
(iv) sworn translation, if the documents are not in an official language of the requesting State.
The procedure shall be governed by the law of the requested State, which shall act expeditiously.
Finally, the Convention shall enter into force once a second State has deposited the instrument of ratification acceptance, approval or accession.
Mireia Bosch
Vilá Abogados
For more information, please contact:
9th September 2022
