Choice-of-law Rules for Electronic Consumer Contracts: Replacement of the Rome Convention by the Rome I Regulation

Journal of Private International Law

Volumn 3, Issue 1, 2007, Pages 89-112

  Gillies, Lorna E ^a  

^a UNIVERSITY OF LEICESTER   (United Kingdom)

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EID: 84963938901     PISSN: 17441048     EISSN: 17578418     Source Type: Journal    
DOI: 10.1080/17536235.2007.11424318     Document Type: Article

References (125)

1. European Commission, “Communication From the Commission to the European Parliament, The Council, The Economic and Social Committee and The Committee of the Regions, Consumer Policy Strategy 2002–2006” (Tampere Council), Brussels COM (2002) 208, http://www.europa.eu.int/consumers/policy/intro/consumer_policy_strategy_en.pdf and http://europa.eu.int/comm/consumers/policy/intro/intro_en.html at para 3.2.3.3
2. A consumer is a natural person, acting outside their trade or profession in accordance with the Unfair Terms in Consumer Contract Regulations 1999 implementing Directive 93/13 EEC, 1993 OJ L95/29
3. 3 Art 153 (ex Art 129a), TEU
4. G, Finocchiaro, “European Law and Consumer Protection in the Information Age” (2003) 12 Information and Communications Technology Law111
5. Ibid. The Tampere Council's Consumer Policy Strategy, supran 1, confirmed “[T]he Commission will take into account the consumer's interest when Community rules on international private law are established.”
6. J, Rothchild, “Protecting the Digital Consumer: The Limits of Cyberspace Utopianism” (1999) 74 Indiana Law Journal893
7. “Green Paper on the Conversion of the Rome Convention of 1980 on the law applicable to contractual obligations into a Community instrument and its modernization”, COM(2002) 654 final, 14 January 2003 available at http://www.europa.eu.int/eur-lex/com/gpr/2002/com2002_0654en01.pdf (obtained 21/01/03) (hereafter “Green Paper”) and the Press Release “Commission launches consultation on the law applicable to contractual obligations (“Rome I”)“, Brussels, 14 January 2003, available at http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/03/45|0|AGED&lg=EN&display=
8. “Council Report on the Convention on the law applicable to contractual obligations, by Professors Mario Giuliano and Paul Lagarde” (1980) OJ C282 (hereafter the “Giuliano and Lagarde Report”), 4. Words italicised for emphasis
9. J, Meeusen, M, Pertegás and G, Straetmans (eds), Enforcement of International Contracts in the European Union: Convergence and Divergence between Brussels I and Rome I(Antwerp, Intersentia, 2004)
10. PM, North, “The EEC Convention on the Law Applicable to Contractual Obligations (1980): Its History and Main Features”, in PM, North (ed), Contract Conflicts: The EEC Convention on the Law Applicable to Contractual Obligations: A Comparative Study(Amsterdam, North Holland, 1982), 5
11. L, Collins, “Contractual Obligations–The EEC Preliminary Draft Convention on Private International Law” (1976) 25 International and Comparative Law Quarterly35 citing the “Giuliano and Lagarde Report”, supran 8, 1
12. “Second protocol conferring on the Court of Justice powers to interpret the 1980 convention (Consolidated version),” OJ C334, 30.12.2005, p. 1
13. Max Planck Institute for Comparative and International Private Law, “Comments on the European Commission's Proposal for a Regulation of the European Parliament and the Council on the Law Applicable to Contractual Obligations (Rome I).”,
14. Green Paper, supran 7, 29
15. P, North, “Private International Law: Change or Decay?” (2001) 50 International and Comparative Law Quarterly477, 503
16. The Green Paper goes as far as to suggest that reform has been overdue since reassessment of Article 5 of the Rome Convention was a condition of the Greek Accession to the Rome Convention back in 1986; supran 7, 29. The recent opinion of the EESC reiterates the necessity for revision of the Rome Convention to “compliment…the proposed Rome II regulation” and harmonise contractual choice of law rules generally amongst the Member States; “Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the European Parliament and of the Council on the law applicable to contractual obligations (Rome I)”, COM(2005) 650 final–2005/0261 (COD), 13 September 2006, available at http://eescopinions.eesc.europa.eu/eescopiniondocument.aspx?language=en&docnr=1153&year=2006 (hereafter “EESC Opinion“). Word in bracket removed for syntax
17. According to a recent EEC-Net report “The European Online Marketplace: Consumer Complaints 2005“, June 2006, http://www.euroconsumer.org.uk/eur_online_marketplace_20052.pdf, available at http://www.euroconsumer.org.uk/index/publications/consumer_reports/evidence_jun06_ecommerce_report.htm, the number of complaints vis-à-viscontracts between businesses and consumers online doubled from 831 in 2004 to 1834 in 2005 (at 3). The majority of those complaints related to (defective or non-) delivery of goods. Services were excluded from the analysis
18. LE Gillies, “The Continuing Significance of Top-Down Legal Regulation of Risk in Business- to-Consumer Electronic Commerce”, in I, Ramsay (ed), Consumer Choice and Risk, (Kluwer/Sakkoulas, forthcoming). Word in brackets added
19. C, Coteanu, Cyber Consumer Law and Unfair Trading Practices(Aldershot, Ashgate, 2005)
20. L, Moerel, “The Country-of-Origin Principle in the E-Commerce Directive: The Expected ‘One Stop Shop’?” (2001) 7 Computer and Telecommunications Law Review184, 190, n 53
21. R, Fentiman, “English Private International Law at the End of the 20th Century: Progress or Regress?”, in SC, Symeonides (ed), Private International Law at the End of the 20th Century: Progress or Regress?(London, Kluwer Law International, 2000), 190
22. EU Commission, “Proposal for a Regulation of the European Parliament and the Council on the law applicable to contractual obligations (Rome I)”, COM (2005) 650 final, 2005/0261 (COD), 15 December 2005 (hereafter referred to as the draft Rome I Regulation). EESC Opinion, supran 16
23. Editorial, “On the Way to a Rome I Regulation” (2006) 43 Common Market Law Review913, particularly 918–22. See also Z Tang, “Parties' Choice of Law in E-Consumer Contracts” (2007) 3 Journal of Private International Law113
24. Editorial, supran 23, 918
25. A, Patel, “The Brussels Regulation…Good for Business” (2000) 2(12) E-commerce Law and Policy10, 13. Word in bracket amended. It is unfortunate that the United Kingdom has not (yet) indicated that it will, in due course, adopt the Rome I Regulation; EESC Opinion, supran 16, para 1.5
26. EESC Opinion, supran 16, para 3.3.1
27. PM, North and JJ, Fawcett, Cheshire and North's Private International Law(London, Butterworths, 13th edn, 1999), 542
28. J, Hörnle, “The European Union Takes Initiative in the Field of E-Commerce” Commentary (2000) 3 Journal of Information, Law and Technology, http://elj.warwick.ac.uk/jilt/00–3/hornle.html. Finocchiaro, supran 4
29. Unfair Terms in Consumer Contracts Regulations incorporating Directive 93/13/EC, (1993) OJ L95/29
30. Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the Protection of Consumers in respect of Distance Contracts (Distance Selling Directive), (1997) OJ L0007
31. Directive 2002/65/EC concerning the Distance Marketing of Consumer Financial Services and Amending Council Directives 90/619/EEC, 97/7/EEC and 98/27/EEC, (2002) OJ L271/16
32. Directive 2005/29/EC concerning unfair business-to-consumer commercial practices in the internal market (the Unfair Commercial Practices Directive), (2005) OJ L149/22, scheduled to come into force by the end of 2007. The Directive will apply to misleading and aggressive practices which lead to pressure selling. The test in determining whether a commercial practice is unfair when it is contrary to professional diligence and materially distorts consumers' behaviour
33. Ibid. J Hamilton and LE Gillies, “The Impact of E-commerce on Consumer Welfare–Information Disclosure Regimes” (2003) 11 Journal of Financial Regulation and Compliance, 329
34. Eg, the Distance Selling Directive requires, inter alia, the business to provide certain information to the consumer. It also provides the consumer with a right of withdrawal and stipulates rules on performance of the contract
35. Directive 2000/31/EC on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Electronic Commerce Directive), (2000) OJ L178
36. Electronic Commerce Directive, Art 3(3) and Recital 23, ibid; CT Poggi, “Electronic Commerce Legislation: An Analysis of European and American Approaches to Contract Formation” (2000) 41 Virginia Journal of International Law224, 247
37. Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, (2001) OJ L12/1 (hereafter the Brussels I Regulation)
38. United Kingdom Department of Trade and Industry Consultation Paper, “European Commission Proposals for Changes to Article 13 of the 1968 Brussels Convention”, Copyright Department of Trade and Industry, 12 April 2000
39. OJ L12/1, supran 37
40. S, Dutson, ‘E-Commerce–European Union Transnational E-Commerce’ (2000) 16 Computer Law and Security Report105; P Stone, “Internet Consumer Contracts and European Private Inter national Law” (2000) 9(1) Information and Communications Technology Law5; LE Gillies, “A Review of the New Jurisdiction Rules for Electronic Consumer Contracts within the European Union” Commentary, (2001) 1 The Journal of Information, Law and Technology http://elj.warwick.ac.uk/jilt/01–1/gillies.html, 28 February 2001; F Debussere, “International Jurisdiction over E-Consumer Contracts in the European Union: Quid Novi Sub Sole?” (2002) 10 International Journal of Law and Information Technology344; P Stone, “The Treatment of Electronic Contracts and Torts in Private International Law under European Community Legislation” (2002) 11 Information and Communications Technology Law121; JST Øren, “International Jurisdiction over Consumer Contracts in e-Europe” (2003) 52 International and Comparative Law Quarterly665
41. “Proposal for a Decision establishing a programme of Community action in the field of Health and Consumer Protection 2007–2013”, (COM(2005) 115 final 2005/0042 (COD)), available at http://europa.eu.int/comm/consumers/overview/programme_2007–2013_en.htm, at para 4.2.3
42. A Regulation on a European Small Claims Procedure is currently in preparation: EU Com mission, “Regulation establishing a European Small Claims Procedure,” COM 2005 87 final, 2005/0220 (COD), 15 March 2005, (http://europa.eu.int/comm/justice_home/fsj/civil/recognition/fsj_civil_recognition_general_en.htm)). In 2004, the Commission proposed a “Directive on Certain Aspects of Mediation in Civil and Commercial Matters”, COM 2004/0718 final, 2004/0251 (COD) (which has yet to be approved); http://ec.europa.eu/civiljustice/adr/adr_ec_en.htm
43. “Council Convention on the Law Applicable to Contractual Obligations”, opened for signature in Rome on 19 June 1980, (80/934/EEC), 1980 OJ L266 (hereafter the “Rome Convention“)
44. North, supran 10, 11–12
45. North and Fawcett, supran 27, 552
46. Art 5, Rome Convention.,
47. Ibid. The modernisation of the Rome Convention should also provide the opportunity to enable Art 5 to apply to the sale of digital goods and services
48. Art 5(1), Rome Convention. Art 5 does not apply to carriage contracts and contracts for the supply of services where the services are to be supplied to the consumer exclusively in a country other than that in which he has his habitual residence (Art 5(4)(a) and (b) respectively). It does apply to contracts for package holidays (Art 5(5)).,
49. North and Fawcett, supran 27, 534
50. The UK European Consumer Centre and EEJ-Net's Interim Report, January–July 2005, available at http://www.euroconsumer.org.uk/index/publications/other_reports/activity_0805_eec_interim_report.htm reported that 36% of the pecuniary value of consumer disputes reported were less than £350. However, according to data recently obtained by IMRG, the long-term growth in UK internet sales is beginning to emerge; “Internet Shopping Hits £3 Billion in November”, 14 December 2006, available at http://www.imrg.org/ItemDetail.aspx?clg=News&cid=nws&pid=News_IMRG_Index&language=en-GB
51. Fentiman, supran 21 and Rothchild, supran 6
52. North and Fawcett, supran 27, 574, 575; Editorial, supran 23
53. Draft Rome I Regulation, Explanatory Memorandum, supran 22, 6, 15
54. 54 Article 7(1) was not implemented in the United Kingdom
55. North and Fawcett, supran 27, 577
56. C, Knofel, “Mandatory Rules and Choice of Law: A Comparative Approach to Article 7(2) of the Rome Convention” [1999] Journal of Business Law239
57. Green Paper, supran 7, 33
58. CGJ, Morse, “The EEC Convention on the Law Applicable to Contractual Obligations” (1982) 2 Yearbook of European Law107, 134
59. Giuliano and Lagarde report, supran 8; TC Hartley, “Consumer Protection Provisions in the EEC Convention”, in North, supran 10, 125; J Blaikie, “Choice of Law in Consumer Contracts” (1992) 60 Scottish Law Gazette6, 7
60. Giuliano and Lagarde Report, supran 8, 23
61. Deemed the “keystone of the system”; Green Paper, supran 7, 11
62. Morse, supran 58, 8 and 9 suggests that this operates to provide the consumer with “minimum” protection
63. A point reiterated by the EESC in its Opinion; supran 16 at para 3.3.1
64. According to Jaffey, the purpose of Art 5 was to ensure that the consumer had the “convenience in consulting the [ie, his] law”, rather than being entitled to whatever lawis more favourable to him (whether his domestic law or a foreign law); AE Jaffey, Topics in Choice of Law(London, British Institute of International and Comparative Law, 1996), 51, 49. Words in square brackets added. At 49 Jaffey continues, “the aim of the choice of law rule must be to select the appropriate governing law on criteria of justice and convenience for the parties “ (a view expressed in his earlier article, “The English Proper Law Doctrine and the EEC Convention” (1984) 33 International and Comparative Law Quarterly531, 540). Cf the potential implications of dépéçagein a consumer contract considered by Green Paper, supran 7, 30, n 64
65. Tang, supran 23
66. G, Howells and T, Wilhelmsson, “EC Consumer Law: Has Come of Age?” (2003) 28 European Law Review370
67. Straetmans, supran 9, 315
68. EESC Opinion, supran 16 at para. 3.3.1
69. Straetmans, supran 9, and Max Planck Institute, supran 13, 39–40. Cf Editorial, supran 23, EESC Opinion, supran 68, Tang, supran 23
70. Straetmans, supran 69, 314
71. C, Riefa, “Article 5 of the Rome Convention on the Law Applicable to Contractual Obligations 1980 and Consumer E-contracts: The Need for Reform” (2004) 13 Information and Communications Technology Law59, 68; C Wild, S Weinstein and C Riefa, “Council Regulation (EC) 44/2001 and Internet Consumer Contracts: Some Thoughts on Article 156 and the Futility of Applying ‘In the Box’ Conflict of Law Rules to the ‘Out of the Box’ Borderless World” (2005) 19 International Review of Law, Computers and Technology13, 17
72. Riefa, supran 71, 60
73. Riefa, supran 71, 60 and DE Tellini, “Applicable Law and Electronic Consumer Contracts: A European Perspective” (2005) 16 International Company and Commercial Law Review1, 7
74. LE, Gillies, “An Analysis of Jurisdiction Rules for Electronic Consumer Contracts: United Kingdom, United States and Global Perspectives”, PhD Thesis, University of Strathclyde, 2005, 42
75. P, Stone, “The Treatment of Electronic Contracts and Torts in Private International Law under European Community Regulation” (2002) 11 Information and Communications Technology Law121, 122; Gillies, supran 74
76. Fentiman, supran 21 and Rothchild, supran 6
77. Gillies, supran 40, 47 referring to BB Sookman, “Electronic Commerce, Internet and the Law–A Survey of the Legal Issues” (1999) Computer and Telecommunications Law Review52, 54
78. CfRiefa, supran 71, 70
79. Draft Rome 1 Regulation, Explanatory Memorandum, supran 22. Brackets added
80. Bertrand v Ott[1978] ECR 1431
81. Supra n 7–10
82. Max Planck Institute, supran 13, 41
83. North, supran 10, 43
84. Morse, supran 58, 11
85. North, (1990) I Hague Rec13, 176. A point made by the same author previously; North, supran 10, 22–23
86. J-M, Niemann, “Webvertisements Covered by Art 5(2) Rome Convention?” (2000) 5 Commun ications Law99
87. 87 Draft Rome I Regulation, Art 5(2). Words in brackets removed for syntax
88. R, Schu, “The Applicable Law to Consumer Contracts Made Over the Internet: Consumer Pro tection Through Private International Law?” (1997) 5 International Journal of Law and Information Technology192, 210
89. O Lando, “Some Issues Relating to the Law Applicable to Contractual Obligations” (1996/97) 7 King's College Law Journal55, 73
90. C, Tillman, “The Relationship Between Party Autonomy and the Mandatory Rules in the Rome Convention” [2002] Journal of Business Law45 at 57
91. Draft Rome I Regulation, Explanatory Memorandum, supran 22, 3
92. Giuliano and Lagarde Report, supran 8, 24
93. Morse, supran 58, 6
94. Shearson Lehman Hutton v TVB C–89/91 [1993] ECR I–139
95. Blaikie, supran 59
96. Green Paper, supran 7, 29; North and Fawcett, supran 27
97. Derived from the US case Zippo Manufacturing v Zippo Dot Com, Inc. 952 F Supp 1119 (WD Pa 1997)
98. World Wide Volkswagen v Woodson, 444 US 286, 100 SCt 559 (1980)
99. M, Geist, “Is There a There? Towards Greater Certainty for Internet Jurisdiction” (2001) 16 Berkeley Technology Law Journal1345, also available at http://www.law.berkeley.edu/journals/btlj/articles/vol16/geist/geist.pdf; Øren, supran 40
100. Niemann, supran 86, 100 (in particular)
101. European Commission, Justice and Home Affairs DG, “Statement on Articles 15 and 73”, http://www.europa.eu.int/comm/justice_home/unit/civil/justciv_conseil/justiciv_en.pdf obtained at http://www.europa.eu.int/comm/justice_home/unit/civil_en.htm.,
102. Green Paper, supran 7, 31, point vi
103. Draft Rome I Regulation, Explanatory Memorandum, supran 22, 6
104. Editorial, supran 23, 918
105. EU Commission, “Statement on Articles 15 and 73,” supran 101, 6
106. Tellini, supran 73, 7
107. Øren, supran 40
108. Response by Professor Peter Stone, Department of Law, University of Essex, to the Green Paper COM(2002) 654 final of 14 January 2003 available at http://europa.eu.int/comm/justice_home/news/consulting_public/rome_i/doc/university_essex_en.pdf
109. Schu, supran 88, 211
110. As party expectations are and should be no different when a consumer contract is conducted online or offline; cf Schu, supran 88, 225
111. Schu, ibid
112. Ibid
113. S Van Der, Hof, “European Conflict Rules Concerning International Online Consumer Con tracts” (2003) 12 Information and Communications Technology Law, 165, 172
114. “Directive 2000/31/EC on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market”, supran 35
115. Giuliano and Lagarde Report, supran 8, 24 and affirmed by Morse, supran 58, 7
116. OJ L178, supran 35
117. “Statement on Articles 15 and 73”, supran 101
118. Riefa, supran 71, 67
119. Niemann, supran 86, 100; Riefa, supran 71, 65
120. Debussere, supran 40
121. Riefa, supra, n 71, 64
122. AE, Jaffey, “The Foundations of Rules for the Choice of Law” (1982) 2 Oxford Journal of Legal Studies368, N Reich, “Germany: Time Sharing Contract Consumer Protection and the Rome Convention” (1997) 5 Consumer Law Journal6, 40
123. Riefa, supran 71, 64
124. Easycar (UK) Ltd v Office of Fair Trading(C336/03) [2005] All ER (EC) 834, [2005] ECR I–1947, [2005] 2 CMLR 2
125. Regarded by Tillman as the law in “which the weaker party normally has confidence. This appears to be the law of his or her environment”, supran 90, 53