ECJ: A court of venue clause between a manufacturer and first time buyer does usually not have any impact on the further purchasers within an EU supply chain.

By judgment of 07.02.2013 (File No. C-543/10) the ECJ held that within a series of contracts, which have been concluded between parties in different member states, a court of venue clause, which is part of the contract between the manufacturer and the purchaser of a good, is not effective towards further purchasers, unless the latter has authorized the clause.

In the present case the question on the competence of a court for claims against a manufacturer of compressors within a supply chain within the EU was considered. A project manager (Doumer) had a real estate complex in France renovated. During the renovations, the cooling units were installed. They featured compressors, which were bought from an Italian manufacturer (Refcomp) via two intermediaries, among others the Italian Climaveneta and finally sold to Doumer.

Malfunctions occurred in the air conditioning and Doumer’s insurer, who is also based in France, brought forwards claims for damages among others against the Italian manufacturer Refcomp in front of French courts by way of subrogation. Refcomp challenged the competence of the French courts and referred to a court of venue clause in favour of Italian courts, which was part of its contract with Climaveneta. The French court asked the ECJ for a preliminary ruling in order to answer the question, whether a court of venue clause between the manufacturer and the first-time buyer is also effective towards the subsequent purchaser within a EU supply chain.

In its judgment, the ECJ held that the Regulation (EC) No. 44/2001 of the council of 22.12.2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters says nothing on the question whether a court of venue clause (Art. 23 of regulation EC No. 44/2001) can be applied on a third party, who is party to a subsequent contract and entirely or partial successor to the rights and obligations of the parties of the initial contract. However Art.23 Subsec. 1 of the clearly states that a scope of application is restricted to cases in which parties have “agreed” to a court. As is apparent from the 11. recital of the regulation, the agreement between the parties justifies the priority of the court chosen by the parties contrary to the court that might be applicable in accordance with the regulation. Moreover the ECJ had already ruled on Art. 17 of the previously applicable Brussels Convention that the validity of a court of venue clause requires an “agreement” between the parties and that the court therefore has to consider first, if the venue of court clause is actually subject of a consensus between the parties. Art. 23 Subsec. 1 of the regulation is to be interpreted in a way that it is ensured that a consensus by the parties actually exists. Therefore the agreement on a court of venue can only be effective between the parties of the contract. In principle a third party must approve of such clause in order to have the clause invoked against him.

A reference to national law for the assessment on whether a subsequent purchaser may have a court of venue clause invoked against him, was rejected by the ECJ. Thereby it is avoided that the various member states come to divergent solutions, which would interfere with the regulation’s object on the harmonization of provisions on jurisdiction. Moreover, such a reference to national law would lead to uncertainties, which is incompatible with the endeavour of ensuring predictability in the field of jurisdiction, which is one of the objects of the regulation.

The clients of our law firm are mainly foreign companies (non-EU and EU-companies) as well as German companies. We serve middle-sized companies (mainly corporations) as well as bigger companies listed on the stock exchange.
In addition to companies of the financial service sector (banks and investment companies), most of our clients belong to the manufacturing trade or the industrial sector. Our client's industrial focus is, among others engineering (mechanical and plant engineering), furniture and food industry and the transportation sector, however we are also experienced in the construction sector. The issues arising with the business activities of those companies with regard to fiscal and business law, under which we also define issues with regard to individual and collective labour law, therefore belong to our consulting spectrum. In case of acquisition of companies, we undertake the transaction advisory and preparation of documentation as well as a legal due diligence. If fiscal or economical issues arise, we have renowned corporation partners at hand.

Due to the international profile of the law firm, a very important field of consultation naturally is cross-border commercial law and the securitisation of receivables by appropriate means of securitisation, as well as the collection of commercial receivables.

As a result of our expertise in national and international insolvencies and restructurings, another important scope of our services is the consultation in reorganization/restructuring and insolvency related matters. With regard to the European insolvency regulation (Counsel Regulation) (E.C.) (No.1346/2000) we possess profound knowledge and experience, which has been maintained after having been tried and tested in practice.

Due to previous activities of the founder of the law-firm as "workout" specialist for large credits in a German financial institution, we are able to advise our clients from the point of view of a potential creditor as well as the debtor company's view. Our founder's strength in mediating between the debtor and financial institutions and negotiate realisable restructuring plans results in acceptable and overall prompt solutions for all participants.

We are members of B.R.S.I (Bundesverband Restrukturierung, Sanierung und Interim Management- Corporate Restructering Associations Germany), BCCG (British Chamber of Commerce in Germany), PZGH (Polskie Zrzeszenie Gospodarzo Handlowe) –Polish Association of Economy and Commerce), GRUR (Deutsche Vereinigung für gewerblichen Rechtsschutz und Urheberrecht e.V. – German Association for the Protection of Intellectual Property) and DAV (Deutscher Anwaltsverein - German Lawyers Association).

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This release was published on openPR.