A "new man" arrived to the top of the Campidoglio yesterday afternoon and something new will probably happen, if bad or good only the future will know. Meanwhile Rome is now at the centre of contractual obligations. In fact, on 6 June 2008 the Community Legislature will adopt the so-called Rome I Regulation on the law applicable to contractual obligations.
By way of background, the Rome I Regulation represents an attempt to reform and convert the 1980 Rome Convention into a Community instrument. The Rome Convention is considered to be a cornerstone of legal certainty in international transactions and, as such, we (and many others) have been monitoring the debates in connection with the Regulation for some time.
Fortunately, due to last minute changes, the agreed text of the Regulation does not include certain provisions considered to be problematic from a securitisation perspective. While the agreed upon text of the Rome I Regulation following first reading is substantially similar on a number of fronts to the existing position under the Rome Convention, significant differences were debated along the way. From a securitisation perspective, much of the last minute discussion was focussed on the provision relating to third party effectiveness and priority of a voluntary assignment of a claim (Article 13(3) in the drafts).
At present, there is a split in European jurisprudence as to whether or not the provisions dealing with voluntary assignments in the Rome Convention deal with third party effectiveness and priority, although the majority view appears to be that the relevant provisions do not extend that far. The last minute discussions referred to above were due to the reference, in previous drafts, to the question of whether an assignment may be relied on against third parties being governed by the law of the country in which the assignor has its “habitual residence” at the relevant time.
The adoption of the Rome I Regulation will be a good opportunity also to review the main characteristics also of the Rome II Regulation: in conflict of Laws, Rome II is the European Union Regulation on the law applicable to non-contractual obligations. The intention has been to create an harmonised set of rules within the European Union to govern choice of law in disputes about torts and delicts arising from non-contractual obligations, analogous to the rules established for contract disputes by the Rome Convention of 1980 and summarized in the Rome I Regulation.
Initially submitted by the Commission in July 2003, an amended text was finally adopted on 11 July 2007 and will be applied to events giving rise to damage occurred after its entry into force from 18 months after the date of its adoption. To accommodate concerns earlier raised by the European Parliament at Second Reading stage in January 2007, the Commission is mandated to draw up a study by December 2008 on applicable law in defamation disputes, which have been excluded from the Regulation. This is in addition to their preparing a report within 4 years on the results of practical application of the Regulation, including a specific study of its effects in road traffic accident disputes.