2020/05/26 – 30 Cdo 2084/2019 (summary)

Resolution of the Supreme Court of 26 May 2020, Ref. No. 30 Cdo 2084/2019
(international jurisdiction of a court, Art. 17 of Brussels I bis Regulation, activity “directed to” the Member State of the consumer’s domicile)

The case concerns the issue of international jurisdiction of a court where the claimant demanded from the defendant a payment of retained profit from investing into trades with currencies and commodities via the so-called CFD (“contracts for difference”). The defendant objected the lack of international jurisdiction of the Czech courts. The court of first instance at first concluded that the defendant is a stock broker with its seat in London and claims to be a global leader in the area of online trading. According to the evidence of the Czech National Bank, the defendant was at the relevant time entitled to provide commercial activity on the territory of the Czech Republic in accordance with the Law No. 256/2004 Coll., on the Commercial Activity on the Capital Market. The court of first instance further stated that in this case the claimant acted as a consumer since she concluded an agreement with the defendant outside her commercial activity as a student. The court of first instance concluded that Art. 17 (1) (c) of Brussels I bis Regulation which concerns alternative jurisdiction of a court is applicable since the claimant acted as a consumer and the defendant directed its commercial activities, inter alia, to the Czech Republic. Since the consumer’s domicile was in the Czech Republic, the Czech courts had, in accordance with Art. 18 of Brussels I bis Regulation, jurisdiction to assess and decide the case. The court of appeal confirmed this decision - it added that the possibility to provide investment services without placing its affiliation to the Czech Republic is bound to the intention of foreign entity to provide such services in the Czech Republic. In such manner the presumptions for providing investment services on the territory of another Member State are created in the form of notification which can be interpreted as activity “directed to” within the meaning of Art. 17 (1) (c) Brussels I bis Regulation.

Within the extraordinary appeal, the Supreme Court had to establish whether Czech courts have international jurisdiction and whether the conditions for application of Section IV of Brussels I bis Regulation were met. If this was the case, the claimant as the consumer would have procedural protection in accordance with Art. 19 of Brussels I bis Regulation and could establish international jurisdiction of Czech courts by bringing the action in accordance with Art. 18 (1) Brussels I bis Regulation. The Supreme Court firstly stated that the present case concerns jurisdictional rule stipulated in Art. 17 (1) (c) Brussels I bis Regulation and in order to be applicable, two conditions must be met. Firstly, professional pursues commercial or professional activities in the Member State of the consumer’s domicile or, by any means, directs such activities to that Member State and, secondly, that the contract at issue comes within the scope of such activities. Regarding the notion of activity “directed to” the Member State of the consumer’s domicile in the meaning of above-mentioned article, the Supreme Court noted that there already existed established case-law on the same notion contained in the previous Brussels I Regulation and that it is equally applicable to the present case. The objective of this provision is to ensure better protection of the consumer as economically weaker and legally less experienced party to a contract. The protection, however, is not absolute and a trader must express its will to establish relations with consumers in several Member States, including the Member State of consumer’s domicile. To assess manifestation of such will, there should exist several indications before conclusion of a contract Such indications include express manifestation of will to address consumer, international nature of the commercial activity or indication of a number with international prefix. The Supreme Court further noted that the notion activity “directed to” encompasses not only special offers or advertisement, but a broader scale of activities.

Regarding the present case, the Supreme Court stated that first two conditions for application of Section IV of Brussels I bis Regulation have been met, i.e. the customer contract has been concluded and the claimant had the status of a consumer. The Supreme Court had to therefore ascertain whether the defendant’s commercial activity, which was the object of the customer contract, was directed to the Czech Republic. It deduced from its websites that the defendant presented itself as a global leader in the online trading, that in the contact section it had telephone number with international prefix of the Great Britain and that the website used also neutral domain “.com”. It was further inferred that the defendant was during the period of concluding the contract registered at the Czech National Bank as a foreign stock broker offering investment services in the Czech Republic. Therefore, the fact that the defendant requested to be registered at the Czech National Bank was an apparent expression of its will to establish commercial relations with customers in the Czech Republic, including the consumers. Thus, the defendant directed its commercial activity to the Czech Republic at the time of conclusion of the contract with the claimant and the international jurisdiction should be established in accordance with the Section IV of the Brussels I bis Regulation. According to the Supreme Court, the Czech courts thus had the international jurisdiction to hear the present case.