European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

Regulation No 1215/2012, which has as its object to guarantee legal certainty within the European Union , however gives a significant position to the principle of autonomy of will . Thus, according to the Court of Justice , the prorogation by contract laid down in Article 25 enables the parties to “confer jurisdiction on courts which would not have jurisdiction under the general or special provisi …

Substantive conditions

Regulation No 1215/2012, which has as its object to guarantee legal certainty within the European Union , however gives a significant position to the principle of autonomy of will . Thus, according to the Court of Justice , the prorogation by contract laid down in Article 25 enables the parties to “confer jurisdiction on courts which would not have jurisdiction under the general or special provisions [of the regulation] or exclude the jurisdiction of courts which would normally have jurisdiction under those rules” . Pursuant to Article 25, “[I]f the parties, one or more of whom is domiciled in a Member State, have agreed that a court or the courts of a Member State are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have jurisdiction. Such jurisdiction shall be exclusive unless the parties have agreed otherwise”. By allowing the parties to agree that the clause will not be exclusive, the regulation departs from the Brussels Convention which always set forth the exclusive jurisdiction of the elected court. On the other hand, clauses conferring jurisdiction to the court of a non-Member State do not fall within the regulation, but within private international law in general. Furthermore, clauses conferring jurisdiction have no legal force where they are contrary to the special jurisdiction rules in matters relating to insurance, contracts of employment and consumer contracts or exclusive jurisdiction rules (Article 25(4)). 

The domiciliation of at least one of the parties in the territory of a Member State is a condition indispensable to the implementation of the prorogation by contract. It does not matter whether the defendant is domiciled in the territory of a non-Member State where the plaintiff is domiciled in the territory of a Member State . It is for the court seized to verify that the condition of domiciliation is fulfilled . 

The parties must also designate one or more courts of a Member State as having international jurisdiction . It is sufficient that the jurisdiction clause precisely state the objective factors on the basis of which the parties have agreed to choose a court or the courts to which they wish to submit disputes which have arisen or which may arise between them, without having designated the court by name . According to the Court of Justice, the fact that the terms of Article 25 refer to the designation by the parties to the contract of the court(s) of one Member State must be interpreted as intending to include the right of the parties to agree on two or more courts of distinct Member States for the purpose of settling any disputes which may arise . Accordingly, the contractual clause which “reciprocally confers jurisdiction” by virtue of which each of the parties to a sales contract, who are domiciled in different Member States, can only be sued in the courts of his State, is lawful . 

Pursuant to Article 25(1), the parties agree on a court or the courts that are to have jurisdiction to settle “any disputes which have arisen or which may arise in connection with a particular legal relationship”. According to the Court of Justice , “[t]hat requirement is intended to limit the scope of an agreement conferring jurisdiction solely to disputes which arise from the legal relationship in connection with which the agreement was entered into. Its purpose is to avoid a party being taken by surprise by the assignment of jurisdiction to a given forum as regards all disputes which may arise out of its relationship with the other party to the contract and stem from a relationship other than that in connection with which the agreement conferring jurisdiction was made”. As a result, a clause conferring jurisdiction contained in a company's statutes satisfies the requirement that disputes arise or may arise in connection with a particular legal relationship, if it refers to the disputes between the company and its shareholders as such . In contrast, a clause which abstractly refers to disputes arising from contractual relationships does not extend to a dispute relating to the tortious liability that one party allegedly incurred as a result of its participation in an unlawful cartel. However, the application, in the context of an action for damages brought by a distributor against its supplier on the basis of Article 102 TFEU, of a jurisdiction clause within the contract binding the parties is not excluded on the sole ground that that clause does not expressly refer to disputes relating to liability incurred as a result of an infringement of competition law: while an unlawful cartel, is not, in principle, directly linked to the contractual relationship between a member of that cartel and a third party which is affected by the cartel, an abuse of a dominant position can materialize in contractual relations that an undertaking in a dominant position establishes .

Lastly, the prorogation of jurisdiction by contract is not subject to the finding of an objective connection between the legal relationship in dispute and the court designated . In particular, the parties may agree on a place of performance for contractual obligations which differs from that which would be determined under the law applicable to the obligation at issue pursuant to Article 7(1), and choose a fictitious place of performance with has no actual connection with the real subject-matter of the contract and the resulting obligations, provided that they comply with the requirement as to form set forth regarding clauses electing a forum .

Case C-269/95 Benincasa v Dentalkit [1997] ECR I-3767, LawLex200900001340JBJ: the aim of securing legal certainty by making it possible reliably to foresee which court will have jurisdiction has been interpreted in connection with Article 25 by fixing strict conditions as to form. 

In Recital 15, the regulation provides that "The rules of jurisdiction must be highly predictable and founded on the principle that jurisdiction is generally based on the defendant's domicile […] save in a few well-defined situations in which […] the autonomy of the parties warrants a different linking factor". 

Case C-214/89 Powell Duffryn v Petereit [1992] ECR I-1745, LawLex200900002079JBJ. 

Case C-595/17 Apple Sales International, Apple Inc., Apple retail France (EURL), Judgment of 24 October 2018, LawLex201800001586JBJ, adding that it is not a prerequisite for the application of a jurisdiction clause, in the context of an action for damages brought by a distributor against its supplier on the basis of Article 102 TFEU, that there be a finding of an infringement of competition law by a national or European authority.

Case 56/79 Zelger v Salinitri [1980] ECR 89, LawLex200900002029JBJ. 

Case C-106/95 MSG v Les Gravières Rhénanes [1997] ECR I-911, LawLex200900000336JBJ: according to the Court of Justice, admitting the contrary solution would amount to circumvention both of Article 7(1) - which refers to the place of actual performance of the obligation as criterion of jurisdiction by reason of its direct connection with the court to which it gives jurisdiction - and Article 25 which, whilst providing for jurisdiction by dispensing with any objective connection between the relationship in dispute and the court designated requires, for that very reason, compliance with the strict requirements as to form which it sets out.

Case 22/85 Anterist v Credit lyonnais [1986] ECR 1951, LawLex200900001674JBJ.

For an example of clause selecting a court which derogates from the special jurisdiction provided for in matters relating to a contract in Article 7(1), see Case 56/79 Zelger v Salinitri [1980] ECR 89, LawLex200900002029JBJ. 

This derogation from the principle of non-application of the regulation in case the defendant is domiciled outside the Union results from Article 6(1) which provides that, "[i]f the defendant is not domiciled in a Member State, the jurisdiction of the courts of each Member State shall, subject to Article 18(1), Article 21(2) and Articles 24 and 25, be determined by the law of that Member State".

Case 71/83 Tilly Russ v Nova [1984] ECR 2417, LawLex200900002207JBJ. 

Case C-387/98 Coreck Maritime [2000] ECR I-9337, LawLex200600002027JBJ.

Case 23/78 Meeth v Glacetal [1978] ECR 2133, LawLex200900001695JBJ.

European Business Law

355. Substantive conditions

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355. Substantive conditions

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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