Procedure : 2003/0168(COD)
Document stages in plenary
Document selected : A6-0481/2006

Texts tabled :

A6-0481/2006

Debates :

PV 18/01/2007 - 4
CRE 18/01/2007 - 4

Votes :

PV 18/01/2007 - 9.6
Explanations of votes

Texts adopted :

P6_TA(2007)0006

RECOMMENDATION FOR SECOND READING     ***II
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22 December 2006
PE 378.852v02-00 A6-0481/2006

on the Council common position for adopting a regulation of the European Parliament and of the Council on the law applicable to non-contractual obligations ("ROME II")

(9751/7/2006 – C6-0317/2006 – 2003/0168(COD))

Committee on Legal Affairs

Rapporteur: Diana Wallis

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
 EXPLANATORY STATEMENT
 PROCEDURE

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the Council common position for adopting a regulation of the European Parliament and of the Council on the law applicable to non-contractual obligations ("ROME II")

(9751/7/2006 – C6-0317/2006 – 2003/0168(COD))

(Codecision procedure: second reading)

The European Parliament,

–   having regard to the Council common position (9751/7/2006 – C6-0317/2006),

–   having regard to its position at first reading(1) on the Commission proposal to Parliament and the Council (COM(2003)0427)(2),

–   having regard to the amended Commission proposal (COM(2006)0083),

–   having regard to Article 251(2) of the EC Treaty,

–   having regard to Rule 62 of its Rules of Procedure,

–   having regard to the recommendation for second reading of the Committee on Legal Affairs (A6-0481/2006),

1.  Approves the common position as amended;

2.  Instructs its President to forward its position to the Council and the Commission.

Council common position  Amendments by Parliament

Amendment 1

Recital 7

(7) The material scope and the provisions of this Regulation should be consistent with Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters ("Brussels I") and the Rome Convention on the law applicable to contractual obligations.

(7) The substantive scope and the provisions of this Regulation should be consistent with Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters ("Brussels I"), the Rome Convention on the law applicable to contractual obligations and the future Regulation on the law applicable to contractual obligations ("Rome I").

Justification

It is self-evident that the Regulation should be consistent, not only with the 1980 Rome Convention - which will continue in being owing to the fact that Denmark is not participating in the adoption of the Regulation and the United Kingdom has opted out, at least for the time being, from Rome I - but also with the new regulation in the course of adoption. This amendment corresponds to an amendment adopted in first reading.

Amendment 2

Recital 7 a (new)

(7a) The concern for consistency in Community law requires that this Regulation be without prejudice to provisions relating to or having an effect on the applicable law, contained in instruments of secondary legislation other than this Regulation, such as conflict rules in specific matters, overriding mandatory rules of Community origin, and the basic legal principles of the internal market. As a result, this Regulation should promote the proper functioning of the internal market, in particular the free movement of goods and services.

Justification

This amendment, adopted in first reading, which is based on the wording of Recital 19 in the Commission's original proposal, should be read together with the amendment to Article 27. It is essential that the rules of this Regulation should not hamper the proper functioning of the internal market.

Amendment 3

Recital 10 a (new)

(10a) The conflict-of-laws rules set out in this Regulation also cover obligations based on strict liability and the harmonised rules on connecting factors also apply to the question of the capacity to incur liability in tort/delict.

Justification

In view in particular (but not only) of the obligations arising from traffic accidents based on the strict liability of the vehicle owner, it is important to make it plain that the conflict rules also cover strict liability. It is also worth making it clear that the harmonised rules on connecting factors apply to the question of the capacity to incur liability in tort/delict. This amendment was adopted in first reading.

Amendment 4

Recital 12 a (new)

(12a) Nevertheless, the need to avoid distortions of competition and the requirement of legal certainty must be tempered by the need to do justice in individual cases, and consequently the courts must have a margin of discretion.

Justification

Some flexibility needs to be built into the rules so as to allow the courts to do justice in individual cases. Courts already use the categorisation of issues as "procedural" in order to allow them a measure of discretion. It is better and more consistent with the need for legal certainty overtly to confer certain limited discretionary powers on the courts. This amendment is based on an amendment adopted in first reading.

Amendment 5

Recital 19

(19) The special rule in Article 6 is not an exception to the general rule in Article 4(1) but rather a clarification of it. In matters of unfair competition, the conflict rule should protect competitors, consumers and the general public and ensure that the market economy functions properly. The connection to the law of the country where competitive relations or the collective interests of consumers are, or are likely to be, affected generally satisfies these objectives.

deleted

Justification

It is considered that the general rule can cater perfectly well for cases involving unfair competition. Moreover, in Recitals 20 and 21, the Council makes it clear that what it means by "Unfair competition and acts restricting competition" is infringements of national and Community competition law, in particular breaches of Articles 81 and 82 of the Treaty. However, in its revised proposal (COM(2006)83 final), the Commission took quite a different approach by laying down a rule for "non-contractual obligations arising out of an unfair commercial practice". It preferred to leave anti-competitive practices within the meaning of Articles 81 and 82 of the Treaty subject to the general rule on the ground of the ongoing debate on the Green Paper on Damages actions for breach of the EC antitrust rules, as a result of which "the Commission may wish to support a different solution in the course of the codecision procedure". The Council's approach in the common position would detract from the Commission's right of initiative and pre-empt Parliament's deliberations on any future Commission legislative proposal relating specifically to competition law. It is noted that a corresponding amendment was adopted in first reading.

Amendment 6

Recital 20

(20) The non-contractual obligations arising out of restrictions of competition in Article 6(3) should cover infringements of both national and Community competition law. The law applicable to such non-contractual obligations should be the law of the country on whose market the restriction has, or is likely to have, effect, provided that the effect is direct and substantial. Where the damage is sustained in more than one country, the application of the law of any of those countries should be limited to the damage which occurred in that country.

deleted

Justification

See the justification to the amendment to Recital 19.

Amendment 7

Recital 21

(21) Examples of cases covered by Article 6(3) include prohibitions on agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within a Member State or within the internal market, as well as prohibitions on the abuse of a dominant position within a Member State or within the internal market.

deleted

Justification

See the justification to the amendment to Recital 19.

Amendment 8

Recital 22

(22) Regarding environmental damage, Article 174 of the Treaty, which provides that there should be a high level of protection based on the precautionary principle and the principle that preventive action should be taken, the principle of priority for corrective action at source and the principle that the polluter pays, fully justifies the use of the principle of discriminating in favour of the person sustaining the damage. The question of when the person seeking compensation can make the choice of the law applicable should be determined in accordance with the law of the Member State in which the court is seised.

deleted

Justification

It is considered that the general rule can cater perfectly well for environmental damage. Moreover, it is uncertain what is meant by "environmental damage" and this Regulation should be concerned solely with what the applicable law should be, not with the substantive law on environmental liability. In the event that it should be regarded as imperative to have a special rule for "violations of the environment", a definition clause should be included. This amendment corresponds to an amendment adopted in first reading.

Amendment 9

Recital 25 a (new)

(25a) As regards violations of privacy or rights relating to the personality, this Regulation does not prevent Member States from applying their constitutional rules relating to freedom of the press and freedom of expression in the media. The country in which the most significant element or elements of the damage occur or are likely to occur should be deemed to be the country to which the publication or broadcasting service is principally directed or, if this is not apparent, the country in which editorial control is exercised, and that country's law should be applicable. The country to which a publication or broadcast is directed should be determined in particular by the language of the publication or broadcast or by sales or audience size in a given country as a proportion of total sales or audience size or by a combination of those factors. Similar considerations should apply in respect of publication via the Internet or other electronic networks.

Justification

Whereas in the Commission, in its amended proposal, and the Council, in the common position, have abandoned the attempt to include rules on the law applicable to violations of privacy and rights relating to the personality, the rapporteur considers that this issue should not be shirked. She considers that Parliament's stance in first reading constitutes a sensible approach consistent with the judgment in Case C-68/93 Fiona Shevill and Others [1995] ECR I-415. The rule is formulated to cover situations in which a manifestly closer connection may be considered to exist with the country of the principal place of publication or broadcasting. This will make for more legal certainty for publishers and broadcasters and result in a straightforward rule applying to all publications, even those carried out on the Internet.

Amendment 10

Recital 28

(28) To respect the intentions of the parties and to enhance legal certainty, the parties should be allowed to make an express choice as to the law applicable to a non-contractual obligation. Protection should be given to weaker parties by imposing certain conditions on the choice.

(28) To respect the intentions of the parties and to enhance legal certainty, the parties should be allowed to make an express choice as to the law applicable to a non-contractual obligation. Protection should be given to weaker parties by imposing certain conditions on the choice.Furthermore, it is necessary to respect the intentions of the parties where a choice as to the law applicable to an issue in tort or delict may reasonably be inferred by the court.

Justification

It is important to respect party autonomy also where a choice of law is inferred rather than express. This amendment corresponds to an amendment adopted in first reading.

Amendment 11

Recital 29 a (new)

(29a) It is appropriate to make it clear that, in quantifying damages in personal injury cases, the court seised should apply the principle of restitutio in integrum having regard to the victim's actual circumstances in his country of habitual residence. This should include, in particular, the actual cost of after-care and medical attention.

Justification

Given that the Council has rejected Parliament's first-reading amendment seeking to have the victim's national law applied for the purposes of calculating the quantum of the claim in traffic accident cases, the rapporteur has drafted two new amendments (one to the preamble and one to the enacting terms) in which the same result is sought to be attained by different means. Given the criticism voiced about the original limitation to traffic accidents, the rapporteur has extended the provisions to cover personal injuries generally.

In the case of personal injuries, it is vital to take account of the circumstances in which the victim will find him or herself in his or her country of habitual residence: the actual cost of nursing and carers, medical aftercare and so on. This provision will assist in making free movement of persons within the internal market more attractive for citizens, while showing an awareness of citizens' concerns. It will also avoid placing an unfair burden on the social security and assistance schemes of the country of habitual residence of an accident victim.

This amendment is designed to facilitate reaching agreement with the Council.

Amendment 12

Recital 29b (new)

 

(29b) Any litigant making a claim or counterclaim before a national court or tribunal which falls within the scope of this Regulation may give consideration to any issues of applicable law raised by his claim or conterclaim and accordingly where appropriate notify the court or tribunal and any other parties of the law or laws which that litigant maintains are applicable to all or any parts of his claim.

Justification

This simple provision, introduced in a first-reading amendment, will ensure that the issue of the applicable law is properly considered by both the parties and the court, thus helping to ensure legal certainty.

Amendment 13

Recital 30a (new)

(30a) As in the Rome Convention, the principle of ‘iura novit curia’ applies. The court itself should of its own motion establish the foreign law. In establishing the foreign law the parties are permitted to assist the court and the court should also be able to ask the parties to provide assistance.

Amendment 14

Recital 31

(31) A situation where conflict-of-law rules are dispersed among several instruments and where there are differences between those rules should be avoided. This Regulation, however, does not exclude the possibility of inclusion of conflict-of-law rules relating to non-contractual obligations in provisions of Community law with regard to particular matters.

(31) A situation where conflict-of-law rules are dispersed among several instruments and where there are differences between those rules should be avoided. This Regulation, however, does not exclude the possibility of inclusion of conflict-of-law rules relating to non-contractual obligations in provisions of Community law with regard to particular matters.

This Regulation should not prejudice the application of other instruments laying down provisions designed to contribute to the proper functioning of the internal market insofar as they cannot be applied in conjunction with the law designated by the rules of this Regulation.

 

Justification

See the new Recital 7a and the amendment to Article 27.

Amendment 15

Article 1, paragraph 2, point (g)

(g) non-contractual obligations arising out of violations of privacy and rights relating to personality, including defamation.

deleted

Justification

See the justification to the amendment introducing recital 25a.

Amendment 16

Article 1, paragraph 3

3. This Regulation shall not apply to evidence and procedure, without prejudice to Articles 21 and 22.

3. This Regulation shall not apply to evidence and procedure, without prejudice to Articles 15a, 21 and 22.

Justification

This amendment should be seen in conjunction with the amendments inserting Article 15a and Recital 30a.

Amendment 17

Article 6

Article 6

deleted

Unfair competition and acts restricting free competition

 

1. The law applicable to a non-contractual obligation arising out of an act of unfair competition shall be the law of the country where competitive relations or the collective interests of consumers are, or are likely to be, affected.

 

2. Where an act of unfair competition affects exclusively the interests of a specific competitor, Article 4 shall apply.

 

3. The law applicable to a non-contractual obligation arising out of a restriction of competition shall be the law of the country on whose market the restriction has, or is likely to have, effect.

 

4. The law applicable under this Article may not be derogated from by an agreement pursuant to Article 14.

 

Justification

See the justification to the amendment to Recital 19.

Amendment 18

Article 7

Article 7

deleted

Environmental damage

 

The law applicable to a non-contractual obligation arising out of environmental damage or damage sustained by persons or property as a result of such damage shall be the law determined pursuant to Article 4(1), unless the person seeking compensation for damage chooses to base his or her claim on the law of the country in which the event giving rise to the damage occurred.

 

Justification

See the justification to the amendment to Recital 22.

Amendment 19

Article 7 a (new)

Article 7a

 

Violations of privacy and rights relating to the personality

 

1. As regards the law applicable to a non-contractual obligation arising out of a violation of privacy or rights relating to the personality, the law of the country in which the most significant element or elements of the loss or damage occur or are likely to occur shall be applicable.

 

Where the violation is caused by the publication of printed matter or by a broadcast, the country in which the most significant element or elements of the damage occur or are likely to occur shall be deemed to be the country to which the publication or broadcasting service is principally directed or, if this is not apparent, the country in which editorial control is exercised, and that country's law shall be applicable. The country to which the publication or broadcast is directed shall be determined in particular by the language of the publication or broadcast or by sales or audience size in a given country as a proportion of total sales or audience size or by a combination of those factors.

 

This provision shall apply mutatis mutandis to publications via the Internet and other electronic networks.

 

2. The law applicable to the right of reply or equivalent measures and to any preventive measures or prohibitory injunctions against a publisher or broadcaster regarding the content of a publication or broadcast shall be the law of the country in which the publisher or broadcaster has its habitual residence.

 

3. Paragraph 2 shall also apply to a violation of privacy or of rights relating to the personality resulting from the handling of personal data.

Justification

See the justification to the amendment to Recital 25a.

In addition, the second paragraph relating to injunctive relief is based on the Commission's original proposal, but is more realistic, given that such relief has to be sought and granted swiftly and is interim in nature.

Paragraph 3 is intended to fill a perceived lacuna in the original proposal for a regulation.

The amendment corresponds to one adopted in first reading.

Amendment 20

Article 8, paragraph 3

3. The law applicable under this Article may not be derogated from by an agreement pursuant to Article 14.

3. The law applicable under this Article may be derogated from by an agreement pursuant to Article 14 only if the agreement has been individually negotiated by the parties.

 

The agreement shall always be regarded as individually negotiated where it has not been drafted in advance and the parties have therefore been able to influence the substance of the term.

Amendment 21

Article 15 a (new)

Article 15a

 

Establishing the substance of foreign law

 

The court seised shall of its own motion establish the substance of foreign law. To that end the court may in certain circumstances also ask the parties to provide assistance.

Justification

The principle ‘iura novit curia’ applies. The court must itself ascertain the foreign law on its own initiative. In ascertaining the foreign law the parties are permitted to assist the court and the court may in appropriate cases call for assistance.

Amendment 22

Article 21 a (new)

Article 21a

 

Damages

 

In quantifying damages in personal injury cases, the court seised shall apply the principle of restitutio in integrum, having regard to the victim's actual circumstances in his country of habitual residence.

Justification

See the justification to the amendment introducing Recital 29a.

Amendment 23

Article 26

The application of a provision of the law of any country specified by this Regulation may be refused only if such application is manifestly incompatible with the public policy ("ordre public") of the forum.

1. The application of a provision of the law of any country specified by this Regulation may be refused only if such application is manifestly incompatible with the public policy ("ordre public") of the forum.

 

1a. Furthermore, the application of a provision of the law designated by this Regulation which has the effect of causing non-compensatory damages, such as exemplary or punitive damages, to be awarded may be regarded as being contrary to the public policy ("ordre public") of the forum.

Justification

As far as the new second paragraph is concerned, the existence of exemplary or punitive damages may act as an incentive for forum shopping and therefore the review clause includes a commitment on the part of the Commission to examine the whole question of damages in this context when it reviews the implementation of the Regulation.

This amendment was adopted in first reading.

Amendment 24

Article 27

This Regulation shall not prejudice the application of provisions of Community law which, in relation to particular matters, lay down conflict-of-law rules relating to non-contractual obligations.

This Regulation shall not prejudice the application or adoption of acts of the institutions of the European Communities which:

 

(a) in relation to particular matters, lay down conflict-of-law rules relating to non-contractual obligations; or

 

(b) lay down rules which apply irrespective of the national law governing the non-contractual obligation in question by virtue of this Regulation; or

 

(c) prevent application of a provision or provisions of the law of the forum or of the law designated by this Regulation; or

 

(d) lay down provisions designed to contribute to the proper functioning of the internal market in so far as they cannot be applied in conjunction with the law designated by the rules of private international law.

Justification

The Regulation must be able to co-exist with internal market legislation and promote, rather than hamper, the proper functioning of the internal market. Particular consideration has been given to the Regulation's relationship with the television without frontiers, the e-commerce and the services directives.

This amendment was adopted in first reading.

Amendment 25

Article 28

Relationship with existing international conventions

deleted

1. This Regulation shall not prejudice the application of international conventions to which one or more Member States are parties at the time when this Regulation is adopted and which lay down conflict-of-law rules relating to non-contractual obligations.

 

2. However, this Regulation shall, as between Member States, take precedence over conventions concluded exclusively between two or more of them insofar as such conventions concern matters governed by this Regulation.

 

Amendment 26

Article 30

Not later than ...*, the Commission shall submit to the European Parliament, the Council and the European Economic and Social Committee a report on the application of this Regulation. If necessary, the report shall be accompanied by proposals to adapt this Regulation. In particular, the report shall consider non-contractual obligations arising out of traffic accidents and out of violations of privacy and rights relating to personality, including defamation.

Not later than ...*, the Commission shall submit to the European Parliament, the Council and the European Economic and Social Committee a report on the application of this Regulation. If necessary, the report shall be accompanied by proposals to adapt this Regulation.

 

In making its report, the Commission shall pay particular attention to the effects of the way in which foreign law is treated in the different jurisdictions and the question of damages, including the possibility of awarding exemplary or punitive damages in certain jurisdictions.

 

The report shall also include an analytical study of the extent to which courts in the Member States apply foreign law in practice, including recommendations as to the desirability of a common approach to the application of foreign law.

 

Not later than ..., the Commission, after extensive consultation with the interested parties, shall submit to the European Parliament, the Council and the European Economic and Social Committee a report on the situation in the field of violations of privacy and rights relating to personality with regard to freedom of opinion and freedom of the press. The report shall include an extensive study of the scale of the phenomenon, the problems and an extended impact assessment. If appropriate, the report shall propose amendments to this Regulation and/or the adoption of specific legislation.

 

Not later than ..., the Commission, after extensive consultation with the interested parties, including the Hague Conference on Private International Law, shall submit to the European Parliament, the Council and the European Economic and Social Committee a report on the situation with regard to the law applicable to road traffic accidents. The report shall be accompanied by an extensive study of the scale of the phenomenon, the problems and an extended impact assessment. If appropriate, the report shall propose amendments to this Regulation and/or the adoption of specific legislation.

Justification

The rapporteur’s wish for an extended review clause is shared. The clause should also make it possible to reach agreement with the Council. Since despite intensive debate it has not been possible to find a solution at the Council for the field of violations of privacy and rights relating to personality, following the Commission’s withdrawal of the relevant proposal, this issue should not stand in the way of adoption of the regulation as a whole. But this area needs to remain of interest to the legislator because of its fundamental importance. Finally there is no need for particular professional groups to be specified as interlocutors for consultation..

(1)

OJ C 157 E, 6.7.2006, p. 370.

(2)

Not yet published in OJ.


EXPLANATORY STATEMENT

The rapporteur has considered the Council's common position with considerable care. She appreciates the attention which the Council - and the Commission - has paid to Parliament's first-reading opinion and the fact that many of Parliament's amendments are reflected in the common position in one way or another.

However, in preparing the draft recommendation for second reading, the rapporteur has been very conscious of the overwhelming vote which the first-reading opinion received in Parliament. She would draw attention in particular to the importance which Members attached to the provisions on road traffic accidents and violations of privacy and rights relating to the personality. She has therefore decided to continue to press for the inclusion of appropriate provisions on these matters in the final regulation.

As far as privacy and rights of personality are concerned, the rapporteur is disappointed that the Commission decided to withdraw the relevant provisions from its amended proposal. Whilst conscious of and sympathetic to the political difficulties experienced by the Council, she considers that it is only right and proper that she should maintain Parliament's first-reading amendments in order to give Parliament the possibility to give further thought to this important question and possibly consider other options.

As to the question of road traffic accidents, the rapporteur appreciates the Council's willingness to get the Commission to take up the matter, but feels that a more focused approach is required in the review clause. She also takes the view that more and better consultation is needed with interested parties and that now that the Community is in the course of acceding to the Hague Conference, it is time that the Community coordinated its activities in the sphere of private international law more closely with that body. She also takes the view that the question of damages in personal-injury cases can be appropriately regulated in Rome II and has proposed a new solution, consistent with Parliament's intentions in first reading, which is designed to enable agreement to be reached with Council.

In addition, the rapporteur continues to consider that the special provisions on unfair competition and environmental damage should be deleted, on the grounds set out in the justifications to the relevant amendments.

As for the relationship between Rome II and other Community instruments, she can but quote what she stated in the explanatory statement in her first-reading report, namely "your rapporteur has taken pains to ensure that the regulation can co-exist with Internal Market legislation and promote, rather than hamper, the proper functioning of the Internal Market. Particular consideration has been given to the Regulation's relationship with the television without frontiers and the e-commerce directives. Your rapporteur has been anxious to suggest a principled holistic approach which should avoid the necessity for confusing carve-outs and special regimes, present or future, as these merely serve to make our legislation more complex to navigate and less transparent."

For the rest, the amendments put forward in the draft report, together with their justifications, speak for themselves.


PROCEDURE

Title

Council common position for adopting a regulation of the European Parliament and of the Council on the law applicable to non-contractual obligations ("ROME II")

References

9751/7/2006 – C6-0317/2006 – 2003/0168(COD)

Date of Parliament’s first reading
– P number

6.7.2005

P6_TA(2005)0284

Commission proposal

COM(2003)0427 – C5-0338/2003

Amended Commission proposal

 

Date receipt of common position announced in plenary

28.9.2006

Committee responsible
  Date announced in plenary

JURI
28.9.2006

Rapporteur(s)
  Date appointed

Diana Wallis
14.9.2004

 

Previous rapporteur(s)

 

 

Discussed in committee

2.10.2006

20.11.2006

20.12.2006

 

 

Date adopted

20.12.2006

Result of final vote

+:
–:

0:

13

2

6

Members present for the final vote

Maria Berger, Rosa Díez González, Bert Doorn, Monica Frassoni, Giuseppe Gargani, Klaus-Heiner Lehne, Katalin Lévai, Hans-Peter Mayer, Achille Occhetto, Aloyzas Sakalas, Diana Wallis, Rainer Wieland, Jaroslav Zvěřina, Tadeusz Zwiefka

Substitute(s) present for the final vote

Nicole Fontaine, Jean-Paul Gauzès, Malcolm Harbour, Wolf Klinz, Kurt Lechner, Eva Lichtenberger, Toine Manders, Manuel Medina Ortega, Alexander Radwan

Substitute(s) under Rule 178(2) present for the final vote

Sharon Bowles

Date tabled

22.12.2006

 

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Last updated: 8 January 2007Legal notice