THEMIS COMPETITION 2017 Semi – Final C: European Civil Procedure

THEMIS COMPETITION 2017 Semi – final C: European Civil Procedure

Mutual Trust: a Core Principle of EU Law or a Threat for the Protection of the Fundamental Right of Defence in the EU especially after EU Regulation 1215/2012?

“Umbrellas”, by George Zongolopoulos *

GREEK TEAM TUTOR Gerasimos Mafredas Pelayia Yessiou – Faltsi Eirini Sartzetaki Angeliki Tzifa

Thessaloniki, May 2017

Table of Contents

Mutual Trust: a Core Principle of EU Law or a Threat for the Protection of the Fundamental Right of Defence in the EU especially after EU Regulation 1215/2012? ... 2 I. Preliminary remarks...... 2 II. Simultaneous application of the CJEU concept of mutual trust and of the ECtHR presumption of equivalent protection? ...... 2 1. Respect of fundamental rights and the development of the concept of mutual trust ...... 2 2. Opinion 2/13: Mutual trust as a key objection against the accession of the EU to the ECHR ...... 4 3. Respect of human rights and the development by the ECtHR of the presumption of equivalent protection ...... 6 III. Historical overview of the application of the right of defence within the EU law 8 1. The Brussels Convention...... 8 2. Regulation 44/2001 ...... 9 3. Regulation 1215/2012 ...... 10 IV. Avotinš v Latvia : mutual trust v the presumption of equivalent protection ..... 11 1. The Judgement of the Grand Chamber of the ECtHR ...... 11 2. The separate opinions: id est a preview of the future? ...... 15 V. The automatic enforcement problematic regarding default judgements ...... 16 VI. Concluding remarks ...... 19

Mutual Trust: a Core Principle of EU Law or a Threat for the Protection of the Fundamental Right of Defence in the EU especially after EU Regulation 1215/2012?

I. Preliminary remarks

Recently, the European Court of Human Rights (hereinafter referred to as “ECtHR”) dealt, for the first time, with the issue of recognition and enforcement of foreign judgements under Regulation 44/2001, in the case of Avotiņš v Latvia.1 More specifically, the ECtHR seized the opportunity to discuss the compatibility of the principle of mutual trust with the right to a fair trial under article 6(1) of the European Convention on Human Rights (hereinafter referred to as “ECHR”). This problematic is more prominent in the light of the recast Regulation 1215/2012, which abolished exequatur proceedings, aiming to make cross – border litigation less time – consuming and costly. A systematic approach on the matter requires a previous analysis of the principle of mutual trust, which is the cornerstone of the automatic recognition provided for in Regulation 1215/2012. Within this context, two questions arise, namely: a) does the principle of mutual trust allow a full review of the protection of fundamental rights under article 6 of the ECHR? and b) how has the relationship between the ECtHR and the CJEU2 evolved, with regard to this protection?

II. Simultaneous application of the CJEU concept of mutual trust and of the ECtHR presumption of equivalent protection?

1. Respect of fundamental rights and the development of the concept of mutual trust

Although the founding treaties of the European Communities did not contain express provisions for the protection of human rights, the CJEU shortly developed its own case – law on the role of fundamental rights in the European legal order. According to this well – established case – law, fundamental rights form an integral part of the general principles of EU law. Since the 1970s, the CJEU, being inspired from the common constitutional traditions of

1 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07). In this case, although ECHtR applied the “presumption of equivalent protection”, it further implied that its application should not be taken for granted. 2 Court of Justice of the European Union (hereinafter referred to as “CJEU”).

the Member States and from the guidelines supplied by international treaties, whose parties are the Member States,3 elaborated, on a case-by-case basis, a catalogue of fundamental rights, the observance of which it ensures. Article 6(3) of the TEU codified that case – law and explicitly recognizes that fundamental rights constitute general principles of the Union's law.

Even though the CJEU recognized the ECHR’s4 “special significance” on the protection of human rights,5 as things stood before the Treaty of Lisbon came into force, the Community did not have the competence to accede to this already existing ECHR.6 Given this long-lasting absence of an EU legal instrument, comprising an explicit catalogue of fundamental rights, easily accessible to citizens, the Community adopted the Charter of Fundamental Rights of the European Union (hereinafter referred to as “Charter”) and granted the CJEU the power for its observance. The Charter, initially proclaimed in Nice on 7 December 2000 (at that time not being legally binding) and now (post-Lisbon) part of EU primary law (article 6(1) of the TEU), aims to reaffirm fundamental rights, binding all EU institutions and Member States (article 51(1) of the Charter). Charter rights, which correspond to rights guaranteed by the ECHR, should be given the same interpretation as those ECHR rights. Besides, the Charter, in so far as its provisions are inspired by those of the ECHR, recognizes the ECHR as establishing the minimum human rights standards (article 52(3) of the Charter).

Article 6(2) of the TEU (post-Lisbon), looking forward to the construction of a coherent European area regarding fundamental rights, explicitly requires the Union to accede to the ECHR. Since this has not yet been achieved though, the risk of the existence of dividing lines in Europe in the human rights field still remains.7

In the light of the above incoherent standards of human rights’ protection at a European level, many issues regarding sufficient harmonisation of fundamental rights and effective ways for their full protection arise. To mitigate those issues and promote the cooperation between Member States, particularly in the area of freedom, security and justice, the concept of mutual

3 Internationale Handelsgesellschaft, C-11/70, ECLI:EU:C:1970:114, paragraph 4, and Nold v Commission, C-4/73, ECLI:EU:C:1974:51, paragraph 13. 4 The ECHR was drafted in 1950 by the Council of Europe and entered into force on 3 September 1953. 5 For instance: ERT v DEP, C‑260/89, ECLI:EU:C:1991:254, paragraph 41, and Kadi and Al Barakaat International Foundation v Council and Commission, C‑402/05 and C‑415/05, ECLI:EU:C:2008:461, paragraph 283. 6 Opinion 2/94, ECLI:EU:C:1996:140, paragraphs 34 and 35. 7 The two legal instruments (Charter and ECHR) can thus create the false impression that the EU and ECHR systems are isolated from each other.

trust was invoked. Mutual trust, as a term, is not defined in the treaties.8 It is the ratio (precondition) of mutual recognition,9 which was characterized by the European Council, at Tampere meeting held in 1999, as the cornerstone of judicial cooperation in both civil and criminal matters within the Union.10 The concept of mutual trust refers to the confidence Member States have, or should have, in the functioning of each other’s legal systems and aims at facilitating the harmonisation of national legislations and the free circulation of court judgments in the internal market. Gradually, the CJEU upgraded mutual trust from a concept to a core principle of EU law with significant importance since “it allows an area without internal borders to be created and maintained”; and extended its effects beyond the field of judicial cooperation in the field of asylum and migration policy.11 Opinion 2/13 of the CJEU confirmed that approach by referring to mutual trust as a constitutional principle.12

According to CJEU’s case – law, the principle of mutual trust requires Member States, when implementing EU law, to presume that fundamental rights have been observed by the other Member States.13 According to the above presumption, Member States: a) may not demand a higher level of national protection of fundamental rights from another Member State than that provided by EU law and b) save in exceptional cases, they may not check whether another Member State has actually, in a specific case, observed the fundamental rights guaranteed by the EU.

2. Opinion 2/13: Mutual trust as a key objection against the accession of the EU to the ECHR

Given the accession mandate included in article 6(2) of the TEU, the EU and the Council of Europe reached a draft accession agreement, which was rejected by the Opinion 2/2013 of

8 The concept of mutual trust was introduced by the unratified treaty establishing a constitution for Europe. The Treaty of Lisbon acknowledges mutual recognition (articles 67, 70, 81 and 82 of the TFEU), but makes no reference to the principle of mutual trust. 9 For the principle of mutual recognition to operate, Member States are supposed to trust each other regarding compliance with the fundamental rights. Since Cassis de Dijon (C-120/78, ECLI:EU:C:1979:42), mutual recognition was intended to promote the internal market. Subsequently, the EU regulations providing for the implementation of mutual recognition, in the various fields, work on the principle that mutual trust between Member States is respected. 10 See: http://www.europarl.europa.eu/summits/tam_en.htm, paragraph 33. 11 Rinau, C-195/08, ECLI:EU:C:2008:406, relating to the interpretation of the Regulation (EC) No 2201/2003, and N. S. and Others, C-411/10 and C-493/10, ECLI:EU:C:2011:865, paragraphs 78–80. 12 Opinion 2/13, Full Court, 18 December 2014, ECLI:EU:C:2014:2454, paragraph 191. 13 N. S. and Others, C‑411/10 and C‑493/10, ECLI:EU:C:2011:865, paragraphs 78–80, and Melloni, ECLI:EU:C:2013:107, paragraphs 37 and 63.

the CJEU.14 The main argument used by the CJEU for the rejection was grounded on the core principle of mutual trust.15

More specifically, in its Opinion the CJEU acknowledged that mutual trust between EU Member States is one of the “essential characteristics” of EU law (paragraphs 167-168) and that the principle of mutual trust is of “fundamental importance” in EU law (paragraph 191). It also stated that the principle of mutual trust between the Member States prohibits EU Member States, when implementing EU law, from checking whether other EU Member States observed the fundamental rights guaranteed by the EU (paragraphs 191- 192). Therefore, according to the CJEU, approval of the draft agreement: a) would result the EU to be treated as any other contracting party of the ECHR and would disregard the fact that, in cases of mutual recognition, relationships between EU Member States are governed by EU law to the exclusion of every other law (paragraph 193); and b) would result EU Member States to check each other’s observance of fundamental rights, even though EU law imposes an obligation of mutual trust between them (paragraph 194).

The CJEU was strongly criticized for its Opinion because of the disproportionate weight it attributed on mutual trust in disregard of the protection of fundamental rights. The ECtHR found the Opinion disappointing. Indicatively, its President, Dean Spielmann, during the opening of the judicial year 2015 in Strasbourg, spoke of the “victims” of the Opinion, the EU citizens, who are deprived of the right to have EU acts subjected to the same external scrutiny as regards the respect for human rights as that, which applies to each Member State.16 Following this, concerns are raised on how the abovementioned already tentative relationship between the two Courts will evolve.

From all the above, it can be concluded that the CJEU, by using the objection of mutual trust, chose to actually nullify the mandate of article 6(2) of the TEU in order to secure its own exclusive jurisdiction on EU law and the way in which fundamental rights are currently protected under EU law. However, it should be reminded that accession is still a Treaty

14 Opinion 2/13, Full Court, 18 December 2014, ECLI:EU:C:2014:2454: The CJEU declared the draft agreement incompatible with the EU’s constitutional framework. 15 It is noteworthy that both the view of advocate general Kokott (who had advised the Court to give a conditional ‘yes’ to the draft accession agreement, ECLI:EU:C:2014:2475) and the Commission’s and Member States’ submissions make no reference to this principle. 16 D. Spielmann, ‘Solemn hearing for the opening of the judicial year of the European Court of Human Rights’ Strasbourg, 30 January 2015, available at: http://echr.coe.int/Documents/Speech_20150130_Solemn_Hearing_2015_ENG.pdf.

obligation and the logical consequence of this accession should be the EU to be subjected to the external scrutiny of the ECtHR regarding observance of the ECHR.

3. Respect of human rights and the development by the ECtHR of the presumption of equivalent protection

Within the above mentioned European fundamental rights landscape, composed of two different human rights catalogues (the Charter and the ECHR), overlapping with one another, the compatibility of mutual trust with fundamental rights turned out to be a point of discussion. Blind trust between EU Member States regarding protection of fundamental rights, indeed, seems to be a threat for the protection itself. Although both European Courts tried to find a balanced solution between those two poles, the different approaches that the two Courts have regarding protection of fundamental rights in the field of mutual recognition reveal possible tensions that may emerge in their relations.

It is remarkable that since 2009, when the Charter became legally binding, the CJEU systematically reduced its references to the ECHR and the ECtHR’s case – law.17 Actually, what the CJEU does is taking into account ECtHR’s case – law but without referring to it. This phenomenon leads to the misconception that the Charter and the ECHR are two separate legal instruments with nothing in common, which is contrary to the spirit of the Charter18 and the interpretation rule of article 52(3) of the Charter, mentioned above.19

The CJEU, when balancing fundamental rights and the efficiency of mechanisms functioning in the area of freedom, security and justice, such as the mutual recognition mechanism, prefers limiting the fundamental rights in order not to compromise the effectiveness of those mechanisms, at the cost of a lowering some standards of protection.20 In

17 G. de Búrca, ‘After the EU Charter of Fundamental Rights: the Court of Justice as a human rights adjudicator?’ (2013) available at: http://www.maastrichtjournal.eu/pdf_file/its/mj_20_02_0168.pdf, Michal Ovádek, External Judicial Review and Fundamental Rights in the EU: A Place in the Sun for the Court of Justice, EU Diplomacy Paper 02 / 2016, College of Europe, p. 14. 18 Explanations Relating to the Charter of Fundamental Rights, OJ C 303, 14.12.2007, pp. 17–35 19 Šejla Imamović, Monica Claes and Bruno De Witte (eds.), ‘The EU Fundamental Rights Landscape After Opinion 2/13’, Maastricht Faculty of Law Working Paper 2016/3, pp. 59–60. 20 According to recent research (2016), a possible explanation for this reticence is that the instruments including those mechanisms are the result of complicated and intense negotiations: Monique Hazelhorst, Free Movement of Civil Judgements in the European Union and the Right to a Fair Trial, Springer, p. 242. See also Šejla Imamović, Monica Claes and Bruno De Witte (eds.), ‘The EU Fundamental Rights Landscape After Opinion 2/13’, Maastricht Faculty of Law Working Paper 2016/3, p. 4.

6 other words, the rule, as set by CJEU, is that mutual trust entails a presumption that fundamental rights are protected.

On the contrary, the ECtHR is more reserved on the same issue. However, although reserved, the ECtHR, being “mindful of the specific characteristics and the autonomy of EU law, displays a great deal of restraint when dealing with the principle of mutual trust”.21 To this end, the ECtHR established the presumption that the protection afforded by EU law is equivalent to that provided by ECHR (“presumption of equivalent protection”). More specifically, the ECtHR, in the Bosphorus case,22 ruled that a Member State could in principle be presumed that it is not breaching the ECHR, when complying with its legal obligations emanating from its membership to an international organisation (such as EU), as long as the Member State had no discretion when implementing those obligations and the international organisation ensured adequate protection of human rights in a manner that is at least equivalent to that of the ECHR. The above formulated presumption prevents a Member State from being faced with the dilemma to choose between performing its EU or ECHR obligations. Only in exceptional cases, where it can be demonstrated that the protection of ECHR’s rights was manifestly deficient, this presumption can be rebutted. Subsequently, in the Michaud case,23 the ECtHR set forth two conditions for the application of the “presumption of equivalent protection”: a) the absence of any margin of discretion on the part of the Member State in the performance of its EU obligation; and b) the deployment of the full potential of the control mechanisms provided for by the EU law. According to the above-mentioned under (a) condition, Regulations which contain grounds for refusal cannot benefit from this presumption. That was the case, in ECtHR’s M.S.S. v Belgium and Greece judgement,24 in which the ECtHR found that the “presumption of equivalent protection” did not apply because the state in

21 Emmanuelle Bribosia, Fundamental rights and mutual trust in the European Union – The story of a clash foretold?: in Šejla Imamović, Monica Claes and Bruno De Witte (eds.), ‘The EU Fundamental Rights Landscape After Opinion 2/13’, Maastricht Faculty of Law Working Paper 2016/3, p. 32. 22 ECtHR, 30 June 2005, Bosphorus Airlines v Ireland (Appl. no. 45036/98), paragraphs 155 and 156: In May 1993 an aircraft leased by Bosphorus Airways from Yugoslav Airlines was seized by the authorities of Ireland, where it had been for maintenance, under EC Council Regulation 990/93. Bosphorus Airways consequently lost approximately three years of its four-year lease of the aircraft. According to ECtHR the Irish authorities rightly considered themselves obliged to apply article 8 the above Regulation. It is noted that the CJEU, to which the Irish Supreme Court applied for a preliminary ruling, also confirmed that the above Regulation did apply in that case (C-84/95, ECLI:EU:C:1996:312). 23 ECtHR, 6 December 2012, Michaud v France (Appl. no. 12323/11), paragraphs 113–115. 24 ECtHR, 21 January 2011, M.S.S. v Belgium and Greece (Appl. no. 30696/09), paragraph 340.

7 question, Belgium, on the basis of the so-called “sovereignty clause”, enjoyed discretion and, therefore, it was able to refuse to perform its obligation under Dublin Regulation.25

The above ECtHR’s judgement influenced the CJEU, shortly after, in N.S. and Others joined cases regarding the asylum field.26 Although it initially acknowledged the mutual trust related presumption (upon which Dublin Regulation is based), according to which fundamental rights of the person concerned are protected by all Member States, finally it concluded that this presumption is not conclusive, but it can be rebutted. However, (unlike the ECtHR’s case – law) it set a high standard for that rebuttal; it is only when “systemic deficiencies” give rise to “substantial grounds” for believing that the asylum seeker would be exposed to a “real risk”. Very recently, the CJEU took the same stance in the field of criminal justice (in relation to the European arrest warrant), in Aranyosi and Căldăraru joined cases,27 in which it ruled that exemptions to mutual trust can also be made “in exceptional circumstances”.28

Following the above case – law of CJEU, the question is what will be its consequence in the field of EU civil procedure law, which is also based on the principle of mutual trust. In the light of the ECtHR’s ruling regarding protection of defence rights under Regulation 44/2001, which will be analyzed in Chapter IV, the CJEU’s stance on this issue is strongly awaited.

III. Historical overview of the application of the right of defence within the EU law

1. The Brussels Convention

Since the Brussels Convention in 1968,29 the main aim of the European lawmaker is to simplify cross-border enforcement proceedings, which consequently lead to the abolishment of the exequatur proceedings via the recast of Regulation 44/2001 (Regulation EU 1215/2012). Under the formerly effective article 27(2) of the Brussels Convention, it was not clarified whether a breach of the right of defence could be affected by the stance of the defaulting defendant in the Member State where the judgement was issued. The CJEU gave a negative

25 Monique Hazelhorst, Free Movement of Civil Judgements in the European Union and the Right to a Fair Trial, Springer, pp. 209 and 244. 26 N. S. and Others, C‑411/10 and C‑493/10, ECLI:EU:C:2011:865, paragraph 94. 27 Aranyosi and Căldăraru, C‑404/15 and C‑659/15, ECLI:EU:C:2016:198, paragraph 82. 28 Unlike in N.S. and Others, the CJEU does not require that deficiencies be “systemic”. Emphasis is given to the real risk of the person concerned. 29 1968 Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters (consolidated version), Official Journal of the European Communities, C 27/1, 26.01.1998.

answer on that matter,30 citing that “Recognition … must be refused where the document which instituted the proceedings was not duly served on the defendant, even if the defendant had notice of the judgment and did not have recourse to the available legal remedies”. The same answer was given by the CJEU on the question whether article 27(2) of the Brussels Convention is applicable when the legal remedy had been rejected as inadmissible or out of time.31

2. Regulation 44/2001

The scenery changed under Regulation 44/2001,32 which provided expressly that any judgement given in default of appearance of the defendant shall be recognized, even when the document, which instituted the proceedings, had not been duly served33 on the defendant,34 in case he had omitted to lodge a complaint or remedy against the judgement, whereas he could have acted accordingly. In order to encourage the free circulation of judgements in the EU, Regulation 44/2001 altered the former CJEU case – law. Thus, the defendant was required to lodge, within his reasonable possibility to act, every legal remedy available within the State in which the judgment was given, or else it would be unacceptable to invoke allegations concerning shortcomings in the service process regarding the document, which instituted the proceedings. Pursuant to article 34(2) of Regulation 44/2001, it became clear that any fault in the service proceedings can no more consist a ground to refuse the recognition of a judgment, as long as the defaulting defendant had the opportunity to commence proceedings to challenge the judgment in its state of origin. This provision is compatible to the spirit of the same Regulation regarding international jurisdiction, as far as the protection of the defendant is concerned. Article 34 complements article 26(2) of the same Regulation (which is identical to article 20(2) of the Brussels Convention and already to article 28(2) of Regulation 1215/2012),

30 Minalmet v Brandeis, C-123/91, ECLI:EU:C:1992:432, paragraphs 15–22, and Hendrikman and Feyen v Magenta Druck & Verlag, C-78/95, ECLI:EU:C:1996:380, paragraphs 19–20. 31 Klomps v Michel, C-166/80, ECLI:EU:C:1981:137, paragraph 13. 32 Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, Official Journal of the European Communities, I.12/1, 16.01.2001. 33 In any case, according to CJEU case – law, the typical legality of the service of the document instituting the procedure is not enough, but the actual knowledge of the existence of the judgement and its grounds on the merits of the case is required (ASML v Semiconductor Industry Services GmbH (SEMIS), C-283/05, ECLI:EU:C:2006:787, paragraphs 20 and 49). 34 Although the Regulation 44/2001 no more requires that the service of documents is without any shortcomings, in any case it has to provide the defendant with sufficient time and the potential to arrange for his defence. Despite that, abstract terms, such as “sufficient time” or “in such a way as to enable him” shall be interpreted under the light of the domestic legal system of each judge. This, of, course, leaves room for discretion and ambiguity regarding their application.

9 pursuant to which “The Court shall stay the proceedings so long as it is not shown that the defendant has been able to receive the document instituting the proceedings”. The defaulting defendant is thus protected twice: a) the first check stage is realized within the issuing member – state; and b) the second check stage takes place pursuant to article 34(2) and operates as a safety valve. On its part, the CJEU holds that article 34 of Regulation 44/2001 must be interpreted strictly, inasmuch as it constitutes an obstacle to the attainment of one of the fundamental objectives of that Regulation.35

3. Regulation 1215/2012

Under the new light of the recast Regulation 1215/2012,36 the exequatur proceedings mandated by the previous Regulation 44/2001 are abolished. More specifically, the new Regulation expressly provides that “a judgment given in a Member State which is enforceable in that Member State shall be enforceable in the other Member States without any declaration of enforceability being required” (article 39 of the Regulation). However, articles 45(1) and 46 of the new Regulation reiterate the terms of articles 34(2) and 45(1) of the Regulation 44/2001, regarding the grounds for the refusal of recognition and enforcement of a judgement. Although this abolition poses new issues, the new Regulation still safeguards the rights of the defaulting defendant, since it provides for a new legal remedy namely the “application for refusal of recognition and enforcement”, addressed before the courts of the Member State of recognition and enforcement. This reflects the declaration made in its Preamble (paragraph 29) that “the direct enforcement … without a declaration of enforceability should not jeopardise respect for the rights of the defence”.

It is quite evident that both Regulations, besides their differences, serve the same purposes of efficiency and timeliness, sought by the European Union. These purposes are clearly set out in the Preamble of each Regulation.37 However, the road to simplification may not necessarily

35 Opinion of Advocate General Kokott delivered on 3 July 2014, flyLAL-Lithuanian Airlines AS v Starptautiskā lidosta Rīga VAS and Air Baltic Corporation AS, C-302/13, ECLI:EU:C:2014:2046, paragraph 71, Apostolides v David Charles Orams and Linda Elizabeth Orams, C-420/07, ECLI:EU:C:2009:271, paragraphs 55 and 76–77. 36 Regulation (EU) No 1215/2012 of the European Parliament and of the Council, of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast), Official Journal of the European Union, L. 351/1, 20.12.2012. 37 Namely: a) in paragraph 17 of the Regulation 44/2001: “the declaration that a judgment is enforceable should be issued virtually automatically after purely formal checks of the documents supplied, without there being any possibility for the Court to raise of its own motion any of the grounds for non-enforcement provided for by this Regulation”; and b) in paragraph 26 of the Regulation 1215/2012: “the aim of making cross-border litigation less

consist an improvement to overcome any impediments in cross-border proceedings. The formerly applicable Regulation 44/2001 instituted a uniform, self – standing European procedure regarding the enforcement of foreign judgments (the exequatur proceedings).38 This provision used to ensure legal certainty within the EU and the uniform application of EU law in all Member States. On the other hand, Regulation 1215/2012 abolishes any “interim procedures”, namely exequatur proceedings, and thus there is no uniform manner for the defendant to stop the enforcement of the judgement on the grounds of non-recognition in any Member State. Consequently, the burden falls upon each individual Member State to provide for review proceedings, in order to safeguard all procedural guarantees for the defendant.39 Still, an additional quandary arises from the fact that article 2 of Regulation 1215/2012 is applicable even on (ex parte) provisional measures, namely judgements which may have been ordered by such a domestic court or tribunal without the defendant being summoned to appear, as long as the judgment containing the measure had been served on the defendant prior to enforcement. In this case, the safeguarding of the right to a defence is vital.

IV. Avotinš v Latvia : mutual trust v the presumption of equivalent protection

1. The Judgement of the Grand Chamber of the ECtHR

It was not until 2016 that the ECtHR was called upon to examine observance of the guarantees of a fair hearing, in the context of mutual recognition, based on EU law. In Avotiņš v. Latvia ,40 the ECtHR discussed the application of Mr. Pēteris Avotiņš (hereinafter referred to as “the applicant”), a Latvian investment consultant, who claimed to be the victim of a violation of article 6(1) of the ECHR, regarding his defence rights. The application was initially lodged against both the Republic of Cyprus and the Republic of Latvia, but it proceeded solely against the Republic of Latvia, since it was found inadmissible as being out of time against the

time-consuming and costly justifies the abolition of the declaration of enforceability prior to enforcement in the Member State addressed”. 38 Burkhard Hess, Max Planck Institute Luxembourg for Procedural Law, Harmonized Rules and Minimum Standards in the European Law of Civil Procedure, European Parliament, Directorate General for Internal Policies, Policy Department C, Legal Affairs, June 2016, p. 7. 39 Green Paper on the review of Council Regulation (EC) no 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, /* COM/2009/0175 final */ sub-question 3 of Question 2. 40 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07).

Republic of Cyprus. By request of the applicant, the case was brought before the Grand Chamber following a referral from the Fourth Section of the ECtHR.

The case in question begun when Mr. Avotiņš was obligated to repay his debt of USD 100.000 towards F.H. Ltd, by a judgement of the Limassol District Court, issued in default of his appearance. Mr. Avotiņš never challenged the Cypriot judgement, not even after he became aware of its existence. His debtor then initiated the recognition and enforcement proceedings of the Cypriot judgement in the Latvian Courts. Firstly, the Latgale District Court granted F.H. Ltd’s request in full, under Regulation 44/2001, and ordered the recognition and enforcement of the Cypriot judgement against Mr. Avotiņš. The latter lodged an appeal before the Riga Regional Court, which in turn allowed the applicant’s appeal on the merits and rejected F.H. Ltd’s request. Finally, F.H. Ltd lodged an appeal against the Riga Regional Court before the Senate of the Latvian Supreme Court and succeeded to declare the recognition and enforcement of the Cypriot judgement and the charge upon the applicant’s property in Garkalne (Latvia).

The applicant then brought his case before the ECtHR, in the aforementioned manner, complaining that the Senate of the Latvian Supreme Court violated article 34(2) of the Regulation 44/2001 and, in turn, his right to a fair hearing41 under article 6(1) of the ECHR, since the Limassol District Court’s judgement had infringed his right to a defence and should not be recognised and declared enforceable in Latvia. The Fourth Chamber’s conclusion on the matter was that there was no violation under article 6(1) of the ECHR, since the applicant had not challenged the Cypriot judgement in any way. The ECtHR’s assessment on the case in question begun on the grounds that article 6(1) of the ECHR is undoubtedly applicable. Hence, it would proceed to examine the Latvian Court’s compliance to the ECHR.

The ECtHR honors the obligations undertaken by the Contracting Parties against other international organisations (such as the EU) and points out that this exactly is the most fundamental cause for the existence of the “presumption of equivalent protection” (the Bosphorus presumption): to not neglect any state’s international activities and, at the same time, to not create a system of international obligations, which would be “immune” to the ECHR.42 Especially regarding the EU, the equivalent protection may be presumed to be all the

41 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraph 98: “The Court considers that a decision to enforce a foreign judgment cannot be regarded as compatible with the requirements of Article 6 § 1 of the Convention if it was taken without the unsuccessful party having been afforded any opportunity of effectively asserting a complaint as to the unfairness of the proceedings leading to that judgment, either in the State of origin or in the State addressed”. 42 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraphs 102–104.

12 more for granted since 1 December 2009, when the amended article 6 of the TEU awarded the Charter with the same value as the Treaties.

In this present case, the ECtHR ruled that the “presumption of equivalent protection” was applicable43 and that both the aforementioned conditions for its application (as described in the Michaud case)44 were met. More specifically:

a) The provision in question, namely article 34(2) of the Regulation 44/2001 left no margin of manoeuvre or discretion to the respondent Member State. Regarding this first condition, based on the CJEU’s well established case – law, the ECtHR found that the Senate of the Latvian Supreme Court did not enjoy any discretion in this specific instance. This exactly is the differentiating element between this case and the aforementioned M.S.S. case.45 The ECtHR makes an indirect distinction between the grounds for refusal set out in articles 34(1) and 34(2) of Regulation 44/2001, limiting itself only to the examination of article 34(2) of the Regulation;46 and

b) There was no need for the Latvian Supreme Court to request a preliminary ruling from the CJEU, since no issue was raised by the applicant, regarding the interpretation or the compatibility of the applicable EU law with any of the fundamental rights or their adequate protection. Regarding this second condition, the ECtHR clarifies that this should be applied without excessive formalism, assessed in the light of the specific circumstances of each case.

Having reached the aforementioned conclusion, the ECtHR then only had to examine whether, under article 34(2) of the Regulation 44/2001, there was a “manifestly deficient” protection of the applicant’s fundamental rights. The ECtHR acknowledges that mutual recognition mechanisms are essential in order to facilitate the free circulation of judgements and the effective judicial cooperation throughout the EU. Still, it holds that the scope of free circulation must not override the need for protection of the ECHR’s fundamental rights, which may not be limited or sidetracked. Consequently, should a State be both an EU Member State and a contracting party to the ECHR, its courts should apply EU mutual recognition mechanisms only so long as they do not manifestly violate any of the ECHR rights. That being said, the ECtHR results to the very important conclusion that the domestic courts cannot refuse to examine a serious and substantiated complaint regarding the manifestly deficient protection

43 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraph 112. 44 ECHR, 6th December 2012, Michaud v France (Appl. no. 12323/11). 45 ECtHR, 21 January 2011, M.S.S. v Belgium and Greece (Appl. no. 30696/09). 46 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraphs 106 and 108.

of the ECHR rights, solely on the grounds that they are in compliance with EU law.47 In this present case, the ECtHR found the requirement to exhaust remedies arising from the mechanism provided for by article 34(2) of the Regulation 44/2001 “is not in itself problematic in terms of the guarantees of article 6(1) of the ECHR”.48 In a very strong and meaningful verse, the ECtHR emphasizes that “the adversarial principle and the principle of equality of arms, which are closely linked, are fundamental components of the concept of a “fair hearing” within the meaning of Article 6(1) of the ECHR, as they require a “fair balance” between the parties”49 and that this right to a fair hearing also extends to the service of judicial documents.

Since the matter of the proper service of the Limassol District Court’s judgement and the burden of proof regarding the existence and availability of a legal remedy in Cyprus were decisive in the present case, the ECtHR finds that it is regrettable that the Latvian Court applied article 34(2) of the Regulation 44/2001 automatically and mechanically and it did not examine these matters more explicitly in adversarial proceedings, but that does not constitute a violation of the ECHR. Even more so, since the applicant was offered the opportunity to lodge an appeal before the Cypriot Courts and challenge his rights at that point. According to the information by the Cypriot Government, the applicant had plenty of time to defend himself before the Cypriot Courts, between 16 June 2006 (when he became aware of the Cypriot judgement) and 31 January 2007 (the day his case was brought before the Latvian Supreme Court), especially since the appeal under the laws of Cyprus had no time limit in these cases of default.

Reviewing the substantial facts of the case, the ECtHR shared the view of the respondent Government and held that the applicant practically brought about the dire situation he was found in, by lacking to exercise due diligence on the Cypriot legislation, regarding the consequences of the acknowledgement of debts and the possible proceedings thereof. Moreover, due to his capacity as an investment consultant, he had every opportunity to do so and under no circumstances did he lack the means to defend himself legally. That being said, the ECtHR reached the conclusion that, under the specific circumstances of the case, there was no violation of the applicant’s rights, under article 6(1) of the ECHR, his protection was not manifestly deficient and thus the “presumption of equivalent protection” should not be rebutted.

47 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraph 116 in fine. 48 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraph 118. 49 ECtHR, 23 May 2016, Avotiņš v Latvia (Appl. no. 17502/07), paragraph 119.

Interestingly enough, though, the ECtHR, by repeatedly referring to the specific circumstances of the case in question, leaves a window of opportunity for future cases, where the substantial facts may differ.

2. The separate opinions: id est a preview of the future?

Since the ECtHR’s judgment in Avotiņš v Latvia was this groundbreaking, it could never naturally remain uncontested. Two different views on the matter were expressed, as depicted in the joint concurring opinion of Judges Lemmens and Briede and the dissenting opinion of Judge Sajó. More specifically:

A) The joint concurring opinion of Judges Lemmens and Briede

Although beginning from the same grounds as the majority of the ECtHR, the two Judges followed a different train of thought and extracted different conclusions on the matter in question. Despite the fact they agree with the majority that article 6(1) of the ECHR was applicable in this case and that it has not been violated in result by the Supreme Court of Latvia,50 they differ from the majority in the fact that in the present case there was no need the “presumption of equivalent protection” to be applied. According to them, this presumption should only be applied when the interests of international cooperation are endangered, which was not the case in the matter at hand, given that there was no shortcoming in the proceedings before the Supreme Court of Latvia.

B) The dissenting opinion of Judge Sajó

According to Judge Sajó’s opinion, if there had been a realistic opportunity for the applicant to challenge the Cypriot judgment in Cyprus, then his application before the ECtHR should have to be declared inadmissible and there would be no need for a recourse to the “presumption of equivalent protection” on the grounds of deficiency. Since he had no knowledge of the proceedings, there was no possibility for him to lodge an appeal.

Moreover, Judge Sajó in his dissenting opinion, invoking CJEU’s judgement in Aranyosi and Căldăraru joined cases,51 concludes that the extension of the “presumption of equivalent

50 Since the Cypriot judgement was final, it was therefore enforceable and the applicant’s argument on the grounds of article 38(1) of the Regulation 44/2001 was not valid; since the applicant had not challenged the Cypriot judgement, the argument based on article 34(2) of the Regulation 44/2001 was, also, not valid (point 2 of the Joint Concurring Opinion). 51 Aranyosi and Căldăraru, C‑404/15 and C‑659/15, ECLI:EU:C:2016:198.

protection” in cases, where there is no discretion to consider ECHR rights, does not serve the protection of those rights themselves and, therefore, this presumption may not be applied. To that end, the ECtHR shall have to review State acts and ensure the efficient application of the ECHR, remaining faithful to the ECtHR’s M.S.S. case – law.52 Consequently, national courts should review the effective protection of the ECHR rights, especially when the applicant proclaims a violation of these rights in another contracting country. As he very aptly states, “otherwise, a system not amenable to Convention review will be created”.

V. The automatic enforcement problematic regarding default judgements

To enable a deeper comprehension of the subject matter discussed in Avotiņš v Latvia, regarding the compatibility of the principle of mutual trust with the right to a fair trial, a thorough analysis on the functioning of the EU system of mutual recognition of judgements is required.

The formerly applicable Regulation 44/2001 provided for two stages of control for the recognition and the declaration of enforceability of judgements within the European Judicial Area, namely: a) the first stage of control, within which the addressed domestic court had no discretion to refuse the declaration of enforceability of a foreign judgement (article 41 of the Regulation – which established a simplified exequatur procedure); and b) the second stage of control, within which the addressed domestic court, was empowered with the discretion to refuse or revoke a declaration of enforceability of a foreign judgement, though only following an appeal lodged by the interested party and only on one of the grounds for refusal specified in articles 34 and 35 (article 45 of the Regulation).

In view of the recast Regulation 1215/2012, since the abolition of the exequatur proceedings, the first stage of control has essentially been curtailed on a judicial level by the European lawmaker, thus reflecting the explicit European legislative consensus to promote the free circulation of judgements. Nevertheless, the abolition of this first stage does not entail an overall absence of judicial control, as the enforcement of a foreign judgement may be refused, in case the legal remedy provided for in article 46 of the recast Regulation is sustained. Despite the alteration of the procedure between the two Regulations, the grounds for refusal have not only remained the same, but the wording used to describe them is identical. Therefore, the

52 ECtHR, 21 January 2011, M.S.S. v Belgium and Greece (Appl. no. 30696/09).

16 interpretation of these (identical) grounds by the CJEU, under the light of Regulation 44/2001, shall not be affected.

More specifically, with regard to judgements given in default of appearance of the defendant, the abstract terms used in article 45(1b) of Regulation 1215/2012 are susceptible to interpretation by the addressed domestic judge. Namely, the real meaning of terms such as “in sufficient time” and “in such a way for him to arrange for his defence”, may differ depending on the factual specifications of the case in question. The interpretation given by each addressed judge and, subsequently, the implementation of these grounds in each individual case constitutes in itself the very meaning of the exercise of discretion.53 For these reasons, the ECtHR’s argument that the court before which enforceability is sought lacks any discretion when applying article 34(2) of Regulation 44/2001, and already article 45(1b) of Regulation 1215/2012, is exposed to criticism. After all the ECtHR, in its previous judgement in M.S.S. v Belgium and Greece, had spoken of the discretionary power granted to the domestic authorities, thus giving the impression that in this case it followed a different path, regarding EU instruments providing for grounds for refusal. This case – law would render the “presumption of equivalent protection” ineffective, where these EU instruments were applicable, given that the aforementioned first condition of that presumption would not be satisfied.

Employing this debated discretionary power, domestic judges, competent for recognition, shall be able to refuse the enforcement of a judgement and render it ineffective, if the grounds for refusal are sustainable. This presumes that this judgement was final, in the sense that it could not have been challenged via any legal remedy in its state of origin, including an application for relief.54 To that end, the domestic judge shall have to (and will) examine whether the guarantees of the right to a fair trial were afforded. This control, although abstaining to examine the merits of the case, is adequate to render the judgement non – enforceable.

In other words, through these grounds for refusal, articles 6 of the ECHR and 47 of the Charter, as foundations for article 45(1b) of Regulation 1215/2012, come into play every time a domestic court rules on the enforceability of a foreign judgement. In this regard, a domestic court fulfills its twofold destination both as a domestic and as a European court, applying EU law and the ECHR. Concurrently, this enhanced and substantial role of the domestic judge

53 Monique Hazelhorst, Free Movement of Civil Judgements in the European Union and the Right to a Fair Trial, Springer, pp. 212–213. 54 Lebek v Domino, C‑70/15, ECLI:EU:C:2016:524.

explains the European legislature’s prerogative to abolish the exequatur proceedings, thus concentrating both the obligation and responsibility for the protection of fundamental rights upon the domestic judges. In this context, the latter play a central role, not only as “Union courts of ordinary jurisdiction”, but also as “Convention (ECHR) courts of ordinary jurisdiction”, as it is for them to ensure, in the first place, that the rights of individuals are respected. Domestic courts are, consequently, the ultimate guardians of the fairness of proceedings.55

Still, special attention should be paid, in order to avoid a situation where judges are faced with the dilemma that following the case – law of one European court will expose them to “condemnation” by the other.56 To honor the balance between the diploid of the right to a fair trial and the free circulation of judgements, one must “proceed with a sense of proportion as regards the interpretation of the obstacles to recognition in Article 34(2) of Regulation 44/2001 (already 45(1b) of Regulation 1215/2012) and not to lose sight of the legitimate concerns of the defendant alongside the requirement to ensure the free movement of Court decisions”.57 The ECtHR’s judgement in Avotiņš v Latvia, should therefore be regarded at least as a “cautionary sign” to that end. More importantly so, as the ECtHR reached its conclusion, stressing its concentration on the defendant’s individual circumstances, suggesting that its decision might have been different in the case of a defendant inexperienced in business.

On the other hand, the evolution of the enforcement mechanisms, initially by the simplification of enforceability procedures and gradually by the recent abolishment of the exequatur, runs parallel to the further establishment of the principle of mutual trust. This is because the protection of fundamental rights by the Member States consists a “sine qua non” condition for the principle of mutual trust. The domestic judge, especially under Regulation 1215/2012, is the sole potential violator of those rights (by giving a default judgement, in breach of the right of defence, in the Member State of origin); and, at the same time, their sole safeguard (by refusing to accept the enforceability of a judgement that infringes those rights). This ethical burden placed upon the domestic judges, under the recast Regulation 1215/2012, enhances their sense of duty and, consequently, the essential application of the ECHR rights in

55 Šejla Imamović, Monica Claes and Bruno De Witte (eds.), ‘The EU Fundamental Rights Landscape After Opinion 2/13’, Maastricht Faculty of Law Working Paper 2016/3, p. 69. 56 Šejla Imamović, Monica Claes and Bruno De Witte (eds.), ‘The EU Fundamental Rights Landscape After Opinion 2/13’, Maastricht Faculty of Law Working Paper 2016/3, p. 73. 57 Opinion of Advocate General Kokott delivered on 7 April 2016, Lebek v Domino, C-70/15, ECLI:EU:C:2016:226, paragraph 30.

18 full. This, in turn, confirms the prerequisite of legality, postulated by the EU and the CJEU, even though the domestic judges are not directly supervised by the CJEU.58 Following the landscape formed after the aforementioned Opinion 2/13, even without the EU’s accession to the ECHR, every EU citizen shall be able to depend upon the domestic courts all over Europe, to apply and protect their fundamental rights, upkeeping the standards set by both the ECHR and EU law, within the European Judicial Area, where the principle of the free circulation of judgements applies.

VI. Concluding remarks

A key objective of the EU is to maintain and develop an area of freedom, security and justice, in order to establish progressively an advanced level of judicial cooperation in civil matters, which is necessary for the unimpeded operation of the internal market. To that end, the differences between national rules governing jurisdiction and recognition of civil judgments shall have to be mitigated. A unified system including integrated rules, relieved from formalities and guaranteeing legal certainty, is bound to render cross – border procedures accessible to every EU citizen.

Given that the European Judicial Area includes a vast geographical region, it embraces the great diversity of its citizens with their individual customs and habits. Consequently, any movement by an EU citizen within this area requires the exercise of due diligence, as it entails significant costs and expenses. This, though, is a necessary and indispensable condition, relative to the essence of any movement. As the need for circulation draws increasingly interest over the years, it is obvious that all the more EU citizens make use of their freedom to move. This, of course, means they shall have to bear the risks and consequences of such a movement. In order to counterbalance these risks, the EU acknowledged the need for protection of fundamental rights; in the context of this protection, the EU gradually upgraded mutual trust from a plain concept to a core EU principle, so as to facilitate exactly this freedom of movement.

This freedom by no means hampers the protection of fundamental rights nor does it lead to the restriction of this protection. It is erroneous to base our thoughts on the comparison

58 The CJEU’s role is limited to replying to the interpretative or validity question referred by the domestic court, under article 267 of the TFEU.

between the principle of mutual trust and the protection of fundamental rights and examine which of the two principles is more prominent in the EU. The protection of fundamental rights has always been and shall continue to be a precondition for the legality of EU acts and a foundation for the principle of mutual trust. It is, therefore, safe to say that the principle of mutual trust not only does not threat this protection of fundamental rights, but on the contrary it shelters it. In this context, both domestic courts and the CJEU oversee the full application of EU law in all Member States and ensure the judicial protection of those rights under that law.

Following the above, it is crucial to stress that the protection of fundamental rights must not consist a point for dissension between national and supranational courts, especially nowadays when every value is being challenged, but a point of connection between them. This acceptance shall open the road to dialogue and cooperation, regardless of EU’s accession to the ECHR.

It is now a well – established notion, that the less limitations on free circulation are imposed, the greater the effectiveness of EU law shall be, but not to the detriment of the protection of fundamental rights. The domestic judges, as first line vigilants, shall constitute the utmost shield of this protection. They, in turn, reflecting upon this great responsibility, shall have to stand tall and fulfill this significant role.

* The image used in the cover page depicts a sculpture placed at the new seaside of Thessaloniki. More specifically, it is the signature artwork “Umbrellas” by the renowned Greek sculptor, painter and architect George Zongolopoulos. For the purposes of this paper, it is used to illustrate the EU’s protective character towards human rights. From a wider point of view, it is known that the artist himself considered this work of art as symbolic to the protection and warmth represented by the umbrella, as a commonly familiar object.