[Hague-jur-commercial-law] Story on The Hague March 8, 2004

[Manon Ress]

*FYI:  Technology Daily March 8, 2004
U.S. Groups Consider Escape Clauses In Draft Hague Treaty*
by William New <mailto:wnew@nationaljournal.com>

     U.S. groups with a stake in a treaty on legal jurisdiction in and 
enforcement of cross-border business contracts are combing through the 
latest draft for final changes.
     The groups, including libraries, consumer representatives and 
lawyers, met with a member of the U.S. delegation on Monday to discuss 
what they see as troubling provisions of the draft Convention on 
Jurisdiction, Enforcement and Enforcement of Foreign Judgments. The 
treaty is being negotiated under the Hague Conference on Private 
International Law <http://www.hcch.net/e/index.html> in the Netherlands.
     Negotiators from around the world are targeting the end of the year 
for completion of the decade-old talks. The convention has been narrowed 
to cover only the clauses in business-to-business contracts relating to 
which country's courts have jurisdiction in disputes. Observers said the 
decision to narrow the once-endangered treaty has given it new momentum 
in the past year.
     The next planned full negotiation is scheduled for April 21-27 in 
The Hague. A smaller group of government negotiators is expected to meet 
in Washington on March 29-31 to try to make early headway on difficult 
intellectual property issues. The meeting will be partially open to the 
public.
     Negotiators also have met with the U.S. Council for International 
Business <http://www.uscib.org/> and may meet with Internet service 
providers and others in early April.
     Monday's meeting followed one held Friday at the American Library 
Association <http://www.ala.org/>. Libraries are concerned that they may 
fall under the terms of the treaty if they can be held to contracts they 
could not negotiate, such as those involving "click wrap," in which 
built-in terms for downloading digital materials prohibit what libraries 
otherwise may do.
     Issues under discussion on Monday included escape clauses. The 
participants generally agreed that a provision on validity of contracts 
should be clarified so the clause pertaining to jurisdiction is not 
valid if the rest of the contract is not valid.
     Separately, a compromise struck in December provides a way out of 
contracts if complying with a court decision would lead to a "very 
serious injustice," which reflects the common-law approach, or would be 
"manifestly contrary to fundamental principles of public policy," a 
standard that reflects civil code. The policy determination generally is 
seen as more easily found by courts, so the provision attempts to create 
balance, a participant said.
     Another provision would let a party escape a contract if 
proceedings leading to the judgment were "incompatible with fundamental 
principles of procedural fairness." China objected to the notion of 
procedural fairness in a footnote to the text.
     Some participants raised concerns about a provision stating that 
the treaty would not prevent parties from requesting measures to 
temporarily stop court action because they said the language appears to 
encourage such actions. One suggestion was to add a line saying that 
such relief would not be enforceable under the treaty.
     One participant noted that the required Senate ratification process 
for treaties would offer a "final bite at the apple," as changes to the 
agreement could be made.

<#top>

-- 
Manon Anne Ress
Consumer Project on Technology
www.cptech.org
PO Box 19367, Washington, DC 20036
manon.ress@cptech.org, voice: 1.202.387.8030, fax: 1.202.234.5176