Which laws apply in cross-border disputes? – UK’s view on EU plan

In its position paper, which was published as part of the Commission’s consultation process, the UK Government expresses doubts as to the necessity of Rome II.

Specifically, the paper points out that the Commission “has not made any attempt to justify the need for harmonised rules” in the area of non-contractual obligations, and that there has not so far been any “demonstrated need for such an instrument.”

The UK Government claims that the proposed legislation is not justified under the principles of subsidiarity and proportionality in the EC Treaty. These principles require that any legislative action of the Community should not go beyond what is necessary to achieve the proper function of the internal market.

The UK also expresses concerns about the proposed scope of Rome II. According to the paper, the draft Regulation is intended to apply on a worldwide basis, “regardless of whether any of the parties has any connection with a Member State.”

Further, the paper points out the absence of any explanation for “the policy behind the draft,” claiming that this would cause “difficulty and misunderstanding.” The UK says that many clauses are unclear, particularly those dealing with tort (known as delict in Scotland – basically forms of civil liability), unfair competition and the relationship between Rome II and other EU legislative instruments. Amendments are proposed.

Finally, the position paper calls for more clarity and transparency in the consultation process.

Phil Murphy, European Public Affairs Manager at the Advertising Association (AA), told OUT-LAW.COM:

"The AA welcomes the UK Government's robust stance on the Rome II issue. This is the UK sending a clear message that it has not yet been convinced by the Commission which has failed to provide evidence as to the necessity of any Rome II measure. Industry is vociferously against the idea of EU legislation in this area and the UK Government position adds fuel to this fire. It now remains to be seen how other Member States have reacted to the consultation. If there's more of the same to come, then the EC should sensibly abandon its plans for proposals. That would be a good result."

The Union of Industrial and Employers’ Confederation of Europe (UNICE), has also published a position paper disputing the necessity of Rome II and asking the Commission to “refrain from proposing such a regulation.” UNICE suggests that, in the event that the Commission goes ahead with the proposal, the scope of Rome II should be restricted to tort only.

UNICE also points out “diverging language versions” of the draft and other areas of ambiguity and potential confusion.

Finally, UNICE “welcomes” article 23 of the proposed Regulation, which excludes the E-commerce Directive from the scope of the draft law’s application.

The Directive was based on a principle that, subject to some exceptions, a business in a Member State only needs to follow its own laws – not the laws of other Member States, known as the country of origin principle.