The incoming German EU Council Presidency is ready to take over the proposed Regulation on the law applicable to the enforceability of assignments of claims (see EUROPE 11979/1) from 1 July. Together with the current Croatian Presidency, they worked on a revised text, dated 25 June, which is to be discussed on 10 July by the Council Working Party on Civil Law Matters.
Although Zagreb originally hoped to be able to reach a political agreement in the Council in June on this dossier (see EUROPE 12396/12), its ambition was undermined by the Covid-19 pandemic, certainly, but above all by the technicality of the text, which has been giving the Member States a hard time for more than two years.
Applicable law. The text, of which EUROPE has had a copy, maintains the Commission's original proposal for a general rule that, in situations of conflict, the law of the country in which the assignor has his habitual residence at the time of conclusion of the assignment contract shall apply.
Nevertheless, the issue does not seem to be definitively settled, since the text indicates that it is only a "policy decision" and some Member States still want to overturn the general rule, preferring the application of the law of the assigned claim, with several exceptions.
Secured claims. The text also takes up the two options of the Croatian Presidency concerning claims secured by immovable property or property entered in a public register (see EUROPE 12475/18).
The first option is to include a specific conflict-of-laws rule designating as the applicable law the law of the State where the immovable property is situated or under whose authority the register is kept.
The second option would clarify that the common conflict-of-law rule in the Regulation would apply, without prejudice to the formalities or registration required in connection with the transfer of any security interest securing payment of the assigned receivable.
Exclusions. The text currently excludes from the scope of the Regulation assignments of claims arising from: - family or similar relationships under the applicable law, including maintenance obligations; - matrimonial property regimes, property regimes in relationships deemed to be similar to marriage by the applicable law and wills and succession; - bills of exchange, cheques and promissory notes and other negotiable instruments; - matters governed by corporate law and other bodies; - the constitution of trusts, the relationships they create between settlors, trustees and beneficiaries; - life insurance contracts arising from transactions carried out by certain organisations ; - claims incorporated in a certificate or in the form of a book entry.
It clarifies that the Regulation also does not apply to the transfer of transferable securities, money market instruments and units of mutual funds.
Moreover, as requested by the European Ministers of Justice during a debate at the beginning of June (see EUROPE 12499/12), the principle of universality is well maintained in the text and specifies that "any law specified by this Regulation shall be applied, whether or not it is the law of a Member State".
According to the text, the Council has not yet determined the date from which the Regulation would apply to concluded assignment contracts. In any case, the ministers were in favour of the non-retroactivity of the regulation. (Original version in French by Marion Fontana)