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

The court to which an application for refusal of enforcement is submitted or the court which hears an appeal lodged against  a decision ruling on a request for refusal of enforcement in the Member State addressed may stay the proceedings if an ordinary appeal has been lodged against the judgment in the Member State of origin or if the time for such an appeal has not yet expired (Art. 51). Recital 31 of Regulation No 1215/2012 provides that “pending a challenge to the enforcement of a judgment, it should be possible for the courts in the Member State addressed, during the entire proceedings relating to such a challenge, including any appeal, to allow the enforcement to proceed subject to a limitation of the enforcement or to the provision of security”.

Article 46(1) of Regulation No 44/2001 entitled the court ruling on the appeal to stay the proceedings on the application of the party against whom enforcement was sought, where the judgment of the court of the State of origin was subject to ordinary appeal in that State or if the time for such an appeal had not yet expired . The court could also, even of its own motion, make enforcement conditional on the provision of a security (Article 46(3)) . 

According to the Court of Justice the concept of “ordinary appeal” is defined as an independent concept under the regulation, and not according to the law of the State of origin or the State in which enforcement is sought , and thus encompasses appeals referred to as extraordinary by the legal systems of some States. According to the Court of Justice, “any appeal which is such that it may result in the annulment or the amendment of the judgment which is the subject-matter of the procedure for recognition or enforcement according to the [regulation] and the lodging of which is bound, in the State in which the judgment was given, to a period which is laid down by the law and starts to run by virtue of that same judgment” is an “ordinary appeal”, provided that it forms part of the normal course of an action and constitutes a procedural development which any party must reasonably expect . This is not the case for appeals which are dependent either upon events which were unforeseeable at the date of the original judgment or upon the action taken by persons who are extraneous to the case, and who are not bound by the period for entering an appeal which starts to run from the date of the original judgment .

The power to stay the proceedings, the specific aim of which is to prevent decisions from being mandatorily recognized and enforced in other Member States at a time where there is a possibility that they be overturned or amended in the State of origin, is strictly interpreted since it must not undermine the free movement of judgments and breach the effectiveness of Article 38 of the regulation, which lays down the principle that a judgment given in a Member State and enforceable in that State may be enforced in another Member State even if it has not yet become res judicata .

Where the time for appeal has not yet expired, the court in which enforcement is sought may extend it. Article 37 on recognition similarly provides that the court authority in which recognition of a judgment given in another Member State is sought may stay the proceedings if that judgment is subject to ordinary appeal.

The provisions of Article 46 of the regulation now cover the court seized against a judgment refusing enforcement and supreme courts seized under Article 44, whereas Article 38 of the Brussels Convention only covered courts with which an appeal had been lodged against a decision authorizing enforcement. The provision of security, mentioned in Article 46(3), may be ordered by the court with which the appeal was lodged against the enforcement judgment only at the time it rules on the appeal, and not before, by an interim order, insofar as it is only when enforcement measures are possible, i.e. once the court has ruled on the appeal, that the protection of the debtor's interests may require enforcement to be made conditional on the provision of security: Case 258/83 Schuhfabrik Brennero v Wendel GmbH [1984] ECR 3971, LawLex200900001783JBJ.

Case 43/77 Industrial Diamond Supplies v Riva [1977] ECR 217, LawLex200900002006JBJ.

Case C-183/90 Van Dalfsen and others v Van Loon and others [1991] ECR I-4743, LawLex200900000755JBJ.

378. Stay of judgment