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First European and Pan-European Integration Efforts and British Reluctance Read chapter Read first chapter

2018 | OriginalPaper | Chapter

The Brexit and Private International Law: An Outlook from the Consumer Insolvency Perspective

Author : Thomas Hoffmann

Published in: Brexit

Publisher: Springer International Publishing

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Abstract

While private law as such has not yet been comprehensively harmonized on the EU level, this is—to a large degree—already the case for private international law. As these harmonized rules will cease to apply once the UK is not member of the Union any more, the Brexit will cause essential challenges when jurisdiction and applicable substantical law have to be determined for disputes between British and EU parties.
Consumer insolvency and consumer debt discharge are at present one of those fields where this harmonization has an especially significant impact, as the UK serves—based on the provisions of the European Insolvency Regulation—as a popular consumer insolvency tourism destination. This chapter analyzes the impact of Brexit on the UK’s and EU private international law on UK and European parties and exemplifies consequences and feasible options of handling these shortcomings by the phenomenon of UK-based consumer insolvency tourism.

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previous chapter From EFTA to EC/EU and Back to EFTA? The European Economic Area (EEA) As a Possible Scenario for the UK-EU Relations After Brexit
next chapter Impact of the Article 50 of TEU on Migration of the EU Workers in Case of Brexit
Footnotes
1
Regulation (EU) no. 1215/2012 of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast) OJ L 351.
 
2
Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters, signed 27 September 1968, OJ L 299–232.
 
3
A consolidated version of the Convention is accessible at [1998] OJ C 27/1.
 
4
See more in the chapter by Schewe and Lipsens (2017).
 
5
Regulation (EC) No 593/2008 of 17 June 2008 on the law applicable to contractual obligations (Rome I), OJ L 177/6.
 
6
Convention 80/934/EEC on the law applicable to contractual obligations, concluded at Rome on 19 June 1980, [1980] OJ L266/1.
 
7
The Regulation is slightly more comprehensive as also insurance issues are covered, just as well as foreign overriding mandatory rules have been treated differently.
 
8
See also Dickinson (2016), p. 204.
 
9
For details on the controversy see Lehmann and Zetzsche (2016).
 
10
Regulation (EC) 864/2007 on the law applicable to non-contractual obligations, OJ L199/40.
 
11
For background see O Lando, The EC Draft Convention on the Law Applicable to Contractual and Non-Contractual Obligations’, ibid p. 6.
 
12
See e.g. Private International Law (Miscellaneous Provisions) Act 1995, sec 11(1).
 
13
Regulation (EU) 2015/848 on insolvency proceedings (recast), OJ L 141/19.
 
14
Also, foreign companies can be object of schemes of arrangement (1) if they have a ‘sufficiently close connection’ to the UK, (2) if there is beneficial effect of the scheme to be expected for the creditors, and (3) if at least one of the creditors falls directly under the UK jurisdiction. These criteria serve to interpret the central requirement for applying the UK law, being “liable to be wound up” as stated in 895(2)(b) Companies Act 2006. These three core requirements have been developed by British court practice already since Real Estate Development Co [1991] BCLC 210.
 
15
For details on the German approach see Weller et al. (2016), p. 2382.
 
16
Cross-Border Insolvency Regulations 2006, 2006 No. 1030.
 
17
Insolvency Act 1986, 1986 c. 45.
 
18
Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, OJ L 299/32.
 
19
On the entire Convention 81/1068/EEC and its reception in detail see Kegel and Thieme (1988).
 
20
European Council (2005), p. 39.
 
21
For Norway and Estonia see Volens and Lilleholt (2016).
 
22
On the French consumer insolvency system see the both contributions by Köhler (2003a, b).
 
23
A more detailed overview see at Hoffmann (2012).
 
24
Art. 13 EIR, 1346/2000/EC.
 
25
C-341/04, Eurofood [2006] ECR I-3813, para 33.
 
26
ECJ, case Interedil Srl (in liquidation) v Fallimento Interedil Srl, C-396/09; [2011].
 
27
ECJ, Interedil C-396/09; [2011], operative part of the judgment, III.
 
28
C-I/04 [2006], ECR I-701.
 
29
Official Receiver vs. Eichler [2007], BPIR 1636.
 
30
BPIR 1636, p. 12.
 
31
See e.g. “London risks becoming “brothel” for bankruptcy tourists”, The Guardian, 31 Jan 2010.
 
32
For further information concerning firms acting in Germany see Hergenröder (2009), p. 310.
 
33
ECJ, case Emsland-Stärke, C-110/99 [2000], ECR 1-11569, par. 39.
 
34
Disagreeing D’Avoine (2011), p. 312, who assumes an abuse of the EIR in cases of obvious “return option” of the debtor.
 
35
C-212/1997 [1999] ECR1-1459, p. 27.
 
Literature
Anderson K (2004) Review essay: “The Explosive Global Growth of Personal Insolvency and the Concomitant Birth of the Study of Comparative Consumer Bankruptcy”. Osgoode Hall Law J 42(4):661–680
D’Avoine M (2011) Internationale Zuständigkeit des deutschen Insolvenzgerichts bei offenkundiger “Rückkehroption” des ehemals selbstständig wirtschaftlich tätigen Schuldners (Unternehmer, Freiberufler, Arzt, Anwalt, Notar etc.) mit dem Ziel der Restschuldbefreiung – Wann wird forum-shopping unerlaubt und verstößt unter Umständen gegen den Ordre public? Neue Zeitschrift für Insolvenzrecht:310–324
Dickinson A (2016) Back to the future: the UK’s EU exit and the conflict of laws. J Priv Int Law:195–210
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Hergenröder CW (2009) Entschuldung durch Restschuldbefreiungstourismus? Voraussetzungen, Grenzen und Verfahrensfragen der Anerkennung einer ausländischen Restschuldbefreiung im Inland nach der EuInsVO. Deutsche Zeitschrift für Wirtschaftsrecht: 309–322
Hess B (2016) Back to the Past: BREXIT und das europäische Internationale Privat- und Verfahrensrecht. Praxis des Internationalen Privat- und Verfahrensrechts: 409–417
Hoffmann T (2012) The phenomenon of “Consumer Insolvency Tourism” and its challenges to European legislation. J Consum Policy 35(4):461–475CrossRef
Kegel G, Thieme J (1988) Vorschläge und Gutachten zum Entwurf eines EG-Konkursübereinkommens. Mohr Siebeck, Tübingen
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Köhler MA (2003b) Reform des Verbrauchersanierungsverfahrens in Frankreich – der lange Weg zur Restschuldbefreiung. Zeitschrift für Verbraucherinsolvenz:626–645
Lando O (1974) The EC draft convention on the law applicable to contractual and non-contractual obligations. Rabels Zeitschrift für ausländisches und internationales Privatrecht/The Rabel Journal of Comparative and International Private Law, 38. Jahrg., H. 1: 6–55
Schewe C, Lipsens D (2017) From EFTA to EC/EU and back to EFTA? The European Economic Area (EEA) as a possible scenario for UK-EU relations after Brexit. In this Volume
Swierczok A (2014) Recognition of english solvent schemes of arrangement in Germany. King’s Stud Law Rev 5(1):78–91
Volens U, Lilleholt K (2016) Consumer insolvency law in Estonia and Norway: comparative aspects. Eur Rev Priv Law 24(5):759–789
Walters A, Smith A (2009) Bankruptcy tourism under the EC regulation on insolvency proceedings: a view from England and wales. Int Insolvency Rev 19:181–208CrossRef
Weller M-P, Thomale C, Benz N (2016) Englische Gesellschaften und Unternehmensinsolvenzen in der Post-Brexit-EU. Neue Juristische Wochenschrift:2378–2383
Metadata
Title
The Brexit and Private International Law: An Outlook from the Consumer Insolvency Perspective
Author
Thomas Hoffmann
Copyright Year
2018
Book
Brexit

Print ISBN: 978-3-319-73413-2

Electronic ISBN: 978-3-319-73414-9

Copyright Year: 2018

DOI
https://doi.org/10.1007/978-3-319-73414-9_14

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