Nacimiento de Alejandro: las leyendas

The general rule in the Regulation is found in Article 4. The Article provides that a defendant domiciled in an EU Member State should be sued in the courts of that Member State. If the national provisions of that State include a collective action mechanism, the action can, in principle, proceed. In a collective redress case, this head of jurisdiction allows for relatively easy bundling of claims of several parties from various States, as it focuses on the Member State in which the defendant is domiciled.

With regards to forum shopping, Article 4 is a provision which clearly favours a

defendant.13 This was intentional in the structuring of the Brussels Regime, having taken the actor sequitur forum rei as its foundation. The Regulation operates on the basis that the defendant should have a reasonable expectation of where they are likely to be sued.14

Special jurisdictions (i.e. derogations from the general rule) are provided for only as an exception. If this is the sole ground for clothing a court with jurisdiction in a collective action, then the claimants would appear to be left with a tactical disadvantage. The

defendant will generally be left in an economically strong position and would benefit from the practicability of their home jurisdiction. Meanwhile foreign collective members

potentially suffer from high costs and the many risks associated with litigation abroad. This would seem particularly inappropriate where a vast majority of victims are domiciled elsewhere.15 Given that many representative authorities working on behalf of the claimants have finite financial resources; this could result in a huge disincentive to litigate. Referring back to Chapter 1, it was mentioned that the opt-in and ‘loser-pays’ rules already

13 _{E. Lein, Cross-border collective redress and jurisdiction under Brussels I: A mismatch, in D. Fairgrieve} and E. Lein, Extraterritoriality and collective redress (OUP, (2012)), 8.11.

14 _{Brussels I Recast Regulation (supra n.7), Recital 15.} 15 _{E. Lein, (supra n.13).}

50 discourage collective actions on the basis of the reduction of the possible award and the risks of having to pay the defendant’s costs if the action is unsuccessful.16

Moreover, jurisdiction at the domicile of the defendant may give the wrong incentives. Even though it might seem practically unlikely, undertakings may deliberately choose to incorporate and take their seat in countries which do not provide for any collective redress mechanisms.17 Companies domiciled, for instance, in France, where there is currently some hostility towards the most effective forms of collective redress (e.g. opt-out mechanisms), would never be subject to such procedures. By contrast, companies

domiciled in Member States such as Sweden and Portugal, which have adopted quite wide ranging mechanisms of collective redress, would be subject to such mechanisms on a local basis; this is hardly in agreement with the idea of a common judicial area, or with the goal to avoid distortions of competition in the internal market.18

There are, however, some benefits for the claimant under Article 4. In fact, the definition of the 'domicile' of companies or other legal persons provided for in Article 63(1) of the Regulation may prove in a collective redress setting to favour a claimant. Article 63(1) provides that the domicile of legal persons is linked to the statutory seat, central

administration, or principal place of business. These criteria do not follow any hierarchical order and leave the claimant free to choose upon which to found jurisdiction.19 _These

places are all considered by law to be of a sufficient link to the dispute. However, from a forum shopping perspective, it may allow claimants to launch a collective suit in a certain Member State for the simple reason that the company has a registered office there. This

16 _{Supra Ch.1, 23; A. Layton, Collective redress: Policy objectives and practical problems, in D. Fairgrieve} and E. Lein, Extraterritoriality and collective redress (OUP, (2012)), 5.39.

17 _{E. Lein (supra n.13), 8.12.}

18 _{A. Nuyts, The consolidation of collective claims under Brussels I, in in A. Nuyts, N.E. Hatzimihail, W. de} Gruyter, Cross-border class actions: The European way (2013), 72.

51 raises questions of appropriateness when the selected forum is only tenuously linked to the dispute whilst the major focus of the case rests elsewhere. This Article thus provides both tactical advantages and disadvantages for both sets of parties depending on the particular set of circumstances.

Some suggest that the domicile of the defendant (or one of the defendants) should actually be the only rule of jurisdiction for collective redress.20 By definition, these types of cases deal with a cross-border activity that causes damages in the territories or in the markets of more than one State. The harmful activity is spread across several States, and the victims or consumers who are harmed by this activity are based in different States. The domicile of the defendants would seem to provide in that case the only central point where all claims and interests can be consolidated and taken into account by a single court.21

Allocating jurisdiction to any court other than the court of the defendant would require that a choice be made amongst, potentially a large number of fora. This would create a number of problems. It would discriminate between end-consumers. The action would be brought in the Member State where some of the end-consumers are domiciled, but not others. Forum shopping would be generated where the procedures and laws perceived to be the most advantageous are located. Moreover, allocating jurisdiction to more than one court could mean that collective redress proceedings could potentially be initiated concurrently in different Member States raising the issue of parallel collective proceedings.

In sum, jurisdiction at the place of the defendant's domicile would appear to be the most appropriate since it is easily identifiable and ensures legal certainty.22 It has nevertheless, a

20 _{A. Nuyts (supra n.18).}

21 _{Ibid., 71.}

52 great disadvantage for the potential collective claimants insofar as they may have to face the cost and difficulties of litigating abroad. Here, it is hard to reconcile both principles: legal certainty and the necessary consumer protections which are both stated objectives in the Commission's Recommendation.23