The law of the place where the event giving rise to damage was committed (Lex loci delicti commissi): The generally accepted solution
Regulation Brussels I Recast does not determine the law applicable to the merits of the case. each State’s rules of private international law determine the applicable law. There is no clear legal test. Therefore it is up to the courts to interpret the connecting criterion, 1 namely the law of the place where the event giving rise to damage occurs (lex loci delicti commissi), Within Member States, the notion of Lex loci delicti is subject to two interpretations:
- The law of the place where the damage occurred, in this case, the foreign law will apply, or
- The law of the place where the causal behaviour occurred, in this case, the law of an EU Member State will apply.
Our situation involves a multinational company domiciled in the european Union, which either a) makes direct decisions about its business conducted abroad, causing harm to an employee or member of the local community, or b) without planning the action causing harm, and knowingly or wilfully ignoring it, fails to take preventative measures to avoid harm. According to the criterion the court selects, either the law of the place where the damage occurred or the law of the place where the causal behaviour occurred will be applied.
Thus, applying lex loci delicti commissi involves several uncertainties regarding:
- The implementation of the connecting criterion (lex loci delicti) due to the variety of possible interpretations,
- The status of the plaintiff’s alleged facts under foreign legislation, and
- The applicable law, for example, if the components of the causal action are geographically disparate, occurring in several different countries (complex torts). This is the case for multinational companies whose policies are decided by the parent company in several EU Member States, and implemented in a third country.
The international public policy exception
The court may cite the international public policy exception to reject the application of a designated foreign law when, for example, the law denies victims the right to a remedy, the right to compensation or when it constitutes a flagrant violation of international human rights law. 2
In addition to jurisdiction, EU Member States may also find that the application of a foreign law that would cause a serious human rights violation constitutes a violation of the member State’s obligations under the european Convention on Human Rights. 3 Where a foreign law runs contrary to international public order, a court may choose to apply its own law to the case. In addition to the abovementioned situation, the forum court of an EU Member State may apply its law in the following situations:
- When the injurious activities were planned and initiated by a company on the territory of the forum court,
- When the causal event of the violation is the company’s lack of supervision vis-à-vis its foreign operations and their consequences, or
- When the parties to the dispute opt for the application of the law of the EU.
The freedom of choice of contracting parties
By common agreement, the parties may also directly designate the law applicable to the dispute unless the law selected runs contrary to the international public policy exception.