Tilburg University Collective redness and private international law in the European Union Bosters, Thijs Publication date: 2015 Document Version Publisher's PDF, also known as Version of record Link to publication in Tilburg University Research Portal Citation for published version (APA): Bosters, T. (2015). Collective redness and private international law in the European Union: Issues regarding jurisdiction and the recognition and enforcement of judgments in cross-border mass disputes relating to financial services. Wolf Legal Publishers (WLP). 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Bosters This book is made possible by: Stichting ter bevordering van internationaal privaatrechtelijk onderzoek © M.W.F. Bosters This study has been closed on 1 December 2014. Any literature or case law that will have been published after this date, has not been incorporated in this study, unless it has been explicitly indicated. This publication is protected by international copyright law. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the author. Printed in the Netherlands Produced by Wolf Legal Publishers Collective redress and private international law in the European Union Issues regarding jurisdiction and the recognition and enforcement of judgments in cross-border mass disputes relating to financial services Proefschrift ter verkrijging van de graad van doctor aan Tilburg University op gezag van de rector magnificus, prof.dr. E.H.L. Aarts, in het openbaar te verdedigen ten overstaan van een door het college voor promoties aangewezen commissie in de aula van de Universiteit op vrijdag 26 juni 2015 om 14.15 uur door Mattheus Wilhelmus Franciscus Bosters, geboren op 19 mei 1985 te Bergen op Zoom Promotores: Prof. mr. I.N. Tzankova Prof. dr. M. Pertegás Overige leden van de Promotiecommissie: Prof. mr. A.I.M. van Mierlo Prof. dr. A. Halfmeier Prof. mr. X.E. Kramer Mr. dr. L. Strikwerda Table of contents Table of contents TABLE OF CONTENTS V GLOSSARY/ABBREVIATIONS XIII 1 RESEARCH OUTLINE 1 1.1 Collective redress and cross-border mass disputes 1 1.2 Definition of and parameters for this study 5 1.3 Research questions and plan 12 1.4 Methodology 14 1.5 Typologies/Classifications of collective redress mechanisms in the EU 15 1.5.1 Public law mechanisms and private law mechanisms 15 1.5.2 Aggregate litigation and representative litigation 18 1.5.2.1 Model or test case 20 1.5.2.2 Collective action 21 1.5.2.3 Collective settlement 22 1.6 Goals of collective redress mechanisms 22 1.6.1 Introduction 22 1.6.2 Efficient legal protection 23 1.6.3 Effective legal protection 26 1.6.4 Reduction of the administrative burden on the judiciary 27 1.7 Goals of the Brussels Regulation 27 1.7.1 Introduction 27 1.7.2 Free movement of judgments 28 1.7.3 Rights of the defence 29 1.7.4 Legal certainty 30 1.7.5 Resolving a dispute before an appropriate court 32 PART I. COLLECTIVE REDRESS MECHANISMS IN THE EU 35 2 GERMAN KAPMUG PROCEDURE 37 2.1 Introduction 37 2.2 Deutsche Telekom and KapMuG history 39 V Table of contents 2.3 How a Capital Model Case is initiated 41 2.4 What plaintiffs can achieve through a KapMuG procedure 44 2.5 Recent experience with the act, and future developments 45 3 DUTCH COLLECTIVE ACTION 47 3.1 Introduction 47 3.2 History of collective action 48 3.3 Parties that can bring a collective action? 50 3.4 Criteria for bringing a collective action 51 3.5 The result of bringing a collective action 52 3.6 Recent experience with collective actions 54 3.7 Future developments 56 4 DUTCH WCAM PROCEDURE 61 4.1 Collective settlement history 61 4.2 The conditions for arranging a WCAM settlement 62 4.3 What can eventually be achieved with a WCAM settlement 64 4.4 WCAM case law 65 4.4.1 Dexia case 66 4.4.2 Vedior case 67 4.4.3 Shell case 68 4.4.4 Converium case 70 4.5 Current and future developments 72 4.5.1 Amendments to the WCAM 73 4.5.2 Preliminary questions Supreme Court 74 PART II. JURISDICTION IN CROSS-BORDER MASS DISPUTES 77 5 JURISDICTION AND THE KAPMUG 81 5.1 Introduction 81 5.2 Submission 82 5.3 Jurisdiction in consumer-related matters 86 5.3.1 Application of chapter II, section 4 Brussels I-bis 86 5.3.2 Jurisdiction in KapMuG procedure relating to financial products 90 5.4 Choice of forum agreement 92 5.4.1 Choice of forum agreement in consumer-related matters 92 VI Table of contents 5.4.1.1 Choice of forum agreement before the dispute arises 95 5.4.1.2 Choice of forum agreement after the dispute has arisen 96 5.4.2 Choice of forum agreement in non-consumer-related matters 98 5.4.2.1 Choice of forum agreement and the underlying financial product 99 5.4.2.2 Choice of forum and the holding of shares 102 5.4.3 Conclusion 103 5.5 General provision 105 5.6 Jurisdiction in contractual matters 106 5.6.1 Various places of performance 109 5.7 Jurisdiction in tortious matters 111 5.7.1 Place where the harmful event occurred or may occur 112 5.8 Effect of grounds of jurisdiction on the goals of collective redress 116 5.8.1 Effective legal protection 116 5.8.2 Efficient legal protection 120 5.8.3 Administrative burden of the judiciary 123 6 JURISDICTION AND THE DUTCH COLLECTIVE ACTION 127 6.1 Introduction 127 6.2 Submission rule 128 6.3 Jurisdiction in consumer-related matters 130 6.4 Choice of forum agreement 132 6.4.1 Mass dispute relating to a financial product 133 6.4.1.1 Third parties and choice of forum agreements 134 6.4.1.2 Separate choice of forum agreement 137 6.4.2 Securities mass dispute 137 6.5 General provision 138 6.6 Jurisdiction in contractual matters 139 6.7 Jurisdiction in tortious matters 140 6.8 Effect of grounds of jurisdiction on the goals of collective redress 144 6.8.1 Effective legal protection 144 6.8.2 Efficient legal protection 146 6.8.3 Administrative burden of the judiciary 148 6.8.4 Conclusions 149 VII Table of contents 7 JURISDICTION AND THE WCAM 151 7.1 Introduction 151 7.2 Procedural role of parties and applicability of the Brussels Regulation 153 7.3 Submission rule 156 7.4 Jurisdiction in consumer-related matters 158 7.5 Choice of forum agreement 160 7.5.1 Choice of forum agreement between the victims and the perpetrator 161 7.5.2 Choice of forum agreement as part of the settlement agreement 163 7.6 General provision and co-defendants 164 7.6.1 Co-defendants pursuant to Article 8(1) Brussels I-bis 169 7.7 Jurisdiction in contractual matters 172 7.8 Jurisdiction in tortious matters 175 7.9 Effect of ground of jurisdiction on the goals of collective redress 176 7.9.1 Effective legal protection and finality 176 7.9.2 Efficient legal protection 179 7.9.3 Administrative burden of the judiciary 181 7.9.4 Conclusion 182 8 PARALLEL PROCEEDINGS 183 8.1 Lis pendens 183 8.1.1 Requirements 183 8.1.2 Application of lis pendens rule to collective redress mechanisms 185 8.2 Related actions 189 8.2.1 Requirements 189 8.2.2 Application of related actions rule to collective redress mechanisms 191 8.3 Conclusions 194 8.4 Parallel proceedings and collective redress goals 195 9 GOALS OF THE BRUSSELS REGULATION REGARDING JURISDICTION 199 9.1 Interim conclusions regarding jurisdiction 199 VIII Table of contents 9.2 Goals of the Brussels Regulation 200 9.2.1 Legal certainty 200 9.2.2 Most appropriate court 204 9.2.3 Preliminary conclusions 207 PART III. RECOGNITION AND ENFORCEMENT OF FOREIGN COLLECTIVE REDRESS JUDGMENTS 209 10 RECOGNITION AND ENFORCEMENT OF KAPMUG JUDGMENTS 213 10.1 Introduction 213 10.2 ‘Judgment’ or court settlement? 214 10.3 Non-recognition and non-enforcement of a KapMuG judgment 216 10.3.1 Public policy 217 10.3.2 Defaulting defendant 221 10.3.3 Irreconcilable judgment 222 10.3.4 Conflict with a judgment given in another Member State 225 10.3.5 Summary 226 10.4 Goals of collective redress 227 11 RECOGNITION AND ENFORCEMENT IN RELATION TO A COLLECTIVE ACTION PROCEDURE 231 11.1 Introduction 231 11.2 Cross-border effect on third parties 232 11.3 Enforcement in a collective action procedure 236 11.4 Non-recognition and non-enforcement in a collective action procedure 236 11.4.1 Defaulting defendant 237 11.4.2 Public policy 238 11.4.3 Irreconcilable judgment 241 11.4.4 Conflict with judgment given in another Member State 242 11.4.5 Summary 243 11.5 Goals of collective redress 244 12 RECOGNITION AND ENFORCEMENT OF A WCAM JUDGMENT 247 12.1 Introduction 247 IX Table of contents 12.2 ‘Judgment’ or court settlement 247 12.3 Enforcement of a WCAM judgment 251 12.4 Non-recognition and non-enforcement of a WCAM judgment 252 12.5 Defaulting defendant 252 12.5.1 Public policy 255 12.5.2 Irreconcilable judgment 260 12.5.3 Conflict with judgment given in another Member State 261 12.5.4 Summary 261 12.6 Goals of collective redress 262 13 GOALS OF THE BRUSSELS REGULATION REGARDING RECOGNITION AND ENFORCEMENT 265 13.1 Interim conclusions regarding recognition and enforcement 265 13.2 Goals of the Brussels Regulation 266 PART IV.