Validity of clauses conferring jurisdiction within the European Union
Validity of clauses conferring jurisdiction within the European Union
Article 23 of the European regulation n°44/2001/EC of 22 December 2000 (Brussels I) states : « If 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 (…) ».
However, the French Court of Cassation, on the basis of this text, had refused, by a judgment dated 4 October 2005, to apply a clause conferring jurisdiction when the only international element was that a portion of the company was domiciled abroad.
By a judgment dated 23 September 2014, the Court of Cassation revised its case-law by validating a clause conferring jurisdiction where the only conditions are that at least one portion of the company is domiciled on the territory of a Member State and that the designated jurisdiction is that of a Member State (Court of Cassation, Commercial Chamber, 23 September 2014, n°12-26.585).
The Court thus expressly states the two conditions to validate clauses conferring jurisdiction within the European Union :
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at least one portion of the company must be domiciled on the territory of the Member State, and
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the designated jurisdiction must be that of a Member State.
In this case, a company under English Law (company A) acquired 100% of the capital of a French company (company B) with a contract containing a clause conferring jurisdiction. Company B itself owned another company (company C). Partners of company B sold their shares and had developed a similar activity to that of company C. Therefore, company A sued them for the breach of the warranty of title and for unfair competition before the Commercial Court of Paris, under the clause conferring jurisdiction. The Partners of company B objected to the international jurisdiction noting that the registration abroad of company A was not sufficient to establish the international nature, which was denied by the Court of Cassation.