Internet Newsletter for Lawyers
March/April 2004, by Delia Venables

Jurisdiction on the Internet - Where to Sue?
by Sinead Morgan

Due to the borderless nature of the internet, issues of liability and jurisdiction are fraught with difficulty. Despite the fact that e-commerce is experiencing incredible growth on a global scale, European states have not yet dealt clearly with the question of which court to try the defendant in a dispute which arises out of an online transaction. In direct comparison with the European situation the US courts have succeeded in establishing a strong framework of case law in relation to this issue. In this article I propose to examine European legislation on this issue and look to US caselaw to determine if we can draw from their experience in order to deal with on-line disputes in a practical and commercially workable manner.

In Europe we have begun to address this area using legislative means. The Brussels Regulation (which replaced the Rome Convention on judgements in jurisdiction and enforcement of civil and commercial matters 1968) on 1 March 2002 stated that jurisdiction in business to business contracts would be dictated by the jurisdiction clause in the contract. In the event that no jurisdiction clause existed jurisdiction would be in the member state where the defendant was domiciled (Art 2) – this would be the statutory seat or main place of business, if the defendant was a company (Art 60). However, a consumer can bring proceedings in his home court if the trader “pursues commercial activities in the member state of the consumers domicile or by any means directs such activities to that member state” (Art 15-17). No definition of directs is provided and no guidance or case law available to determine this issue. Commentators believe that offering a choice of languages, currencies or delivery times and prices for countries could be held to be factors. Others suggest that advertising or sending brochures to customers in a member state are also relevant factors. E-tailers should be aware that if they inadvertently sell goods to another member state they may find themselves subject to the jurisdiction of that consumer’s forum. This is a particularly difficult issue to determine when software and electronic products are delivered electronically to customers. The upcoming Hague Convention on jurisdiction and foreign judgements in civil and commercial matters has also been slow in setting out global jurisdiction rules – at present it is also including the term “directing activity” in its draft.

The full article (5 pages) can be downloaded as a Microsoft Word document here. (If you click on this link, the browser will automatically load a Microsoft Quick View version of the paper. Depending on the system you have, this does not always come out quite the same as the original document. If you have any difficulty with Quick View, it is probably better to right click on the link and then download the document to your own system where you can read it with the "proper" Microsoft Word software.)

Sinead Morgan completed a commerce and law degree in National University of Ireland, Galway and a Masters in International Commercial Law (specialising in IP law) in Queen Mary and Westfield College, London. She trained in BCM Hanby Wallace and qualified in 1999, continuing to work there in the employment law department before heading off to Australia to gain legal experience in Minter Ellison as a senior paralegal. She took a career break to travel around Australia and Asia before returning to Ireland and is presently working in finance, seeking a legal post.

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