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ROME I

Latest news: 16 November 2007

Following a series of informal trialogues with the Council Presidency and the Commission, the Legal Affairs Committee will vote on compromises prepared by its rapporteur, Mr Dumitrescu (PES, RO) and supported by all political groups. There will then be an opportunity to table amendments before the November II plenary vote, with a view to reaching an agreement at first reading.

Legal Affairs Compromise Amendments ahead of 20 November vote

Background

Diana Wallis has been appointed Shadow Rapporteur in the Legal Affairs' Committee on the proposed Rome I Regulation. This proposal aims at converting the Rome Convention on the law applicable to contractual obligations into a Community Regulation and to modernise some of its rules. The Commission stressed that the Rome Convention is the only private international law instrument that remains in an international treaty form.

The Rome Convention was opened for signature in 1980 and entered into force in 1991. All the member states have ratified the Convention.

This instrument applies to contractual obligations (e.g. consumer contracts, contracts involving purchase of property etc.) in situations involving a choice of law between two or more countries. The great advantage of the Convention is to raise the level of legal certainty and facilitate the working of the internal market.

Some of the rules of the Convention, however, have become obsolete and need revisiting. The question of modernising the Convention applies in particular for the protection of consumers and workers (known as the "weaker parties"), due to the development of new forms of marketing and distribution.

It is incredibly disappointing that the UK has decided to exercise its opt out in accordance with a 1997 Protocol. That means that the UK will only attend the discussions in the Council as an observer, will not take part to votes and will not be bound by the final instrument. Should the UK decide to opt in, it can only do so once the Regulation has been adopted. British concerns essentially focus on the issue of foreign mandatory rules.

There is no clear evidence that the issues that might worry the UK could not be dealt within the legislative process, as will be the case for all other EU countries, and turning the back to forthcoming discussions is a potentially very detrimental move for many British consumers. The UK government appears to have made this decision after a very limited consultation rather than conducting a wide and open debate on these important issues. Combined with the opt out on maintenance obligations, it is the first time that the UK has decided to exercise its opt out in the field of civil justice. This will not help Britain's cause in Europe.

See the proposed Regulation on maintenance obligations

The UK opt out, however, will not affect the proceedings within the European Parliament.

Background

The Commission published its proposal for a Regulation on the law applicable to contractual obligations in December 2005.

The solutions provided for in the proposed Regulation are basically the same as those contained in the Rome Convention. However, what previously constituted presumptions are now converted into fixed rules. Exception and reservation clauses are also abolished. This is particularly relevant with regard to the new article 8.3, which allows the Court to decide to apply foreign mandatory rules having regard to their nature, purpose and consequences of their application or non application. Under the Rome Convention, seven member states (UK, Germany, Ireland, Luxembourg, Portugal, Latvia and Slovenia) had secured a reservation clause on the equivalent provision in the Rome Convention.

Other important issues to be addressed include the law applicable to consumer contracts, employment contracts and the relationship with the Posted Workers Directive.

Timetable

Documents