Tensions between European Union Law and Private International Law – impact on cross-border mobility of companies

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by Jorge Ribeiro, PhD candidate at Universidad de Vigo

Introduction

This essay intends to give a brief analysis on the relationship between European Union Law and Private International Law, particularly the impact on cross-border mobility of companies in the European space[i].

The Treaty on the Functioning of the European Union (TFEU) explicitly recognises freedom of establishment for companies. However, nowadays, a number of obstacles still persist regarding companies’ mobility as a result of the coexistence of the incorporation and the real seat doctrine. This is also due to the way in which the European Court of Justice (ECJ) case law has dealt with the free movement of companies.

It is argued that it would be welcome if the European legislator could take action, mitigating national private international law contrary to European fundamental freedoms[ii].

Dualism of rules

To determine which company law is applicable to a particular company, there are two existing theories: the real seat theory and the incorporation theory.

The real seat theory[iii] provides that the personal law of the company is the law of the country where it has its real seat (its principal place of business). Instead, according to the incorporation theory[iv] the company and its relationships are subjected to the law of the country where it has been incorporated, i.e. registered.

The major difference between the two theories is their effect on the cross-border transfer of the company seat, both from the home and host state perspective. The real seat theory brings limitations to the cross-border transfer of the real seat by making the company subject to different national legal order each time its real seat moves to another state[v]. Likewise a company from an incorporation state that wishes to move its administrative seat to a real seat state may not be recognized as a company in this host state, without dissolution in the home state.

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The Directive 2000/43/EC and the possibility of indirect discrimination by association: an analysis of the judgment CHEZ Razpredelenie Bulgaria (Case C-83/14)

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by Mariana Schafhauser Boçon, masters' student at University of Minho

The Judgment of the Court of Justice of the European Union (Grand Chamber) in Case C-83/14, delivered on 16 July 2015, concerned a request for a preliminary ruling under Article 267 TFEU from the Administrativen sad Sofia-grad, about the interpretation of Article 1 and Article 2(1) and (2)(a) and (b) of Council Directive 2000/43/EC of 29 June 2000 implementing the principle of equal treatment between persons irrespective of racial or ethnic origin and of Article 21 of the Charter of Fundamental Rights of the European Union (‘the Charter’).

The dispute in the main proceedings relates to the fact that, between 1999 and 2000, the CHEZ Razpredelenie Bulgaria AD – CHEZ RB, a Bulgarian electricity distribution company, installed the electricity meters of all the consumers of the ‘Gizdova mahala’ district, of the town of Dupnitsa (Bulgaria), inhabited mainly by persons of Roman origin, on the concrete pylons forming part of the overhead electricity supply network at a height of between six and seven metres, whereas in the other districts the meters installed by CHEZ RB are placed at a height of 1.70 metres, usually in the consumer’s property, on the façade or on the wall around the property.

In December 2008, Anelia Georgieva Nikolova, owner of a grocery store in the ‘Gizdova mahala’ district, lodged an application with the Komisia za zashtita ot dikriminatsia – KZD (Bulgarian Commission for Protection against Discrimination) alleging that she was suffering direct discrimination on the grounds of nationality due to the practice at issue of CHEZ RB.

Firstly, KZD ruled that the practice at issue constituted an indirect discrimination prohibited on grounds of nationality. However, after that decision was annulled by a judgment of the Varhoven administrativen sad (Supreme Administrative Court), KZD decided that Anelia Nikolova had suffered a discrimination because of her “personal situation” and ordered CHEZ RB to bring discrimination against her to an end and to refrain from such discriminatory behaviour in the future.

Against that decision, CHEZ RB brought an appeal before the Administrativen sad Sofia-grad (Administrative Court, Sofia), which decided to stay proceedings and to refer ten questions to the Court of Justice of the European Union (ECJ) for a preliminary ruling. These questions were also examined by Advocate General Juliane Kokott in her Opinion.
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Humanitarian Visas and the X and X v. Belgium judgment (Case C-638/16 PPU)

 

by Teresa Alves, masters' student at University of Minho

The judgment in Case C-638/16 PPU, delivered by the Court of Justice of the European Union, on 7th March 2017[i] could represent a milestone in the history of the European Union, opening the door to an important legal path of access to international protection in the Member States and improving the Europe’s asylum policy. Particularly in a context of migration crisis that the European Union is trying to solve, adopting different measures. These measures include strengthening border controls, preventing human trafficking and trying to dismantle illegal forms of access to Member States’ borders through organized networks. Another measure is the EU-Turkey Statement that, despite some legal doubts, intends, not only, but also, to create a legal path of access to international protection in the Member States.

The story dates back to October 2016, when a Syrian family (mother, father – married to one another – and their three young children, from Aleppo) applied for a humanitarian visa at the embassy of Belgium in Lebanon. They hoped, with this, to legally enter in Belgium and to request asylum. They claimed that one of them had been abducted by an armed group, beaten and tortured, before being released on payment of a ransom. They emphasized, specially, the deterioration of the security situation in Syria, in general, and in Aleppo, in particular, as well as the fact that, as Orthodox Christians, they were at risk of persecution because of their religious beliefs. This family added that they could not register as refugees in neighboring countries, particularly in view of the fact that the Lebanese-Syrian border had been closed in the meantime.

The competent Belgian authorities promptly rejected the request, explaining that (i) the applicants planned to remain in Belgium for more than 90 days, and under the Visas Code, in accordance with Article 1, the issue of transit visas or visas within the territory of the Member States shall not exceed 90 days in a period of 180 days; (iii) in addition, Article 3 of the ECHR, according to which «no one shall be subjected to torture or inhuman or degrading treatment or punishment», shall not require States Parties to admit «persons living a catastrophic situation» and, lastly, they considered that (iii) Belgian diplomatic posts are not part of the authorities to which a foreigner may apply for asylum. For the reason that, authorizing an entry visa to the applicants in the main proceedings, for the purpose of submitting an application for asylum in Belgium, would be equivalent to allowing them to request this application for asylum in the diplomatic post.

The family appealed against the decision before the Conseil du Contentieux des Étrangers (Council for asylum and immigration proceedings, Belgium), which decided to refer to the Court of Justice questions relating to the granting of humanitarian visas. That is, «must Article 25(1)(a) of the Visa Code be interpreted as meaning that, subject to its discretion with regard to the circumstances of the case, a Member State to which an application for a visa with limited territorial validity has been made is required to issue the visa applied for, where a risk of infringement of Article 4 and/or Article 18 of the Charter or another international obligation by which it is bound is established?», «Does the existence of links between the applicant and the Member State to which the visa application was made (for example, family connections) affect the answer to that question?».
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Editorial of April 2017

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by Alessandra Silveira, Editor

What future do we want for ourselves, for our children and for our Union? (as for the 60 years landmark of the Treaty of Rome: please open the fridge!)

Two weeks ago I went to Rome at the European’s Commission invitation for the celebrations of the 60 years of the constitutive treaties of the current European Union. The Commission had decided to gather a group of Jean Monnet chairs from 34 nationalities for a seminar with the title “The future of Europe: a commitment for You(th)” and for a meeting with the EC Vice President, Federica Mogherini, and the (rotating) President of the Council of the EU, Joseph Muscat (Prime-Minister of Malta). It is my duty to share on this blog what I have heard there.

The EC is moving forward with a series of proposals about the management of globalisation and the future of the European finances, but also tending to develop the European social dimension. And, mostly, proposals tending to conclude the Economic and Monetary Union – that takes monetary and exchange sovereignty from the Member States whilst keeps their financial and fiscal sovereignty, what provokes clear imbalances between the more and the less robust economies of the euro zone. Moreover, the Commission presented on 1 March 2017 a White Paper on the future of Europe[i]  – which prospects the changes we will be subject to over the course of the next 10 years and presents 5 scenarios to face the challenges.

After a large debate – that will take place at the European level in the next months and in which the European Parliament, national parliaments, local and regional authorities and the society in general will participate – President Jean-Claude Juncker will address his considerations on the occasion of the speech of the State of the Union, in September 2017, hence contributing with the European Council for reaching its first conclusions by the end of the year and deciding about the actions to take over the period that precedes the European Parliament’s elections, in June 2019.

Naturally, the outcome will also depend on the electoral results in France and Germany – it couldn’t be any different. Not exactly for the narrative of the “French-German axis”, but because 40% of everything that is built with European funds is money from the French or the German tax payer. Is it not of the most elementary coherence that who pays the most should have a word? Anyhow, the European citizens from the other Member States may not be unrelated to the definition of their future – that’s why they need to know the proposals and pressure political decision-makers towards better choices. The European Union is not made by aliens – it’s our representatives who are there: in the Parliament, in the Council, in the Commission.

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