Encyclopedia of Private International Law
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Encyclopedia of Private International Law

Edited by Jürgen Basedow, Giesela Rühl, Franco Ferrari and Pedro de Miguel Asensio

The role and character of Private International Law has changed tremendously over the past decades. With the steady increase of global and regional inter-connectedness the practical significance of the discipline has grown. Equally, so has the number of legislative activities on the national, international and, most importantly, the European level. With a world-class editor team, 500 content items and authorship from almost 200 of the world’s foremost scholars, the Encyclopedia of Private International Law is the definitive reference work in the field. 57 different countries are represented by authors who shed light on the current state of Private International Law around the globe, providing unique insights into the discipline and how it is affected by globalization and increased regional integration. The Encyclopedia consists of three inter-linked pillars, enhanced by sophisticated search and cross-linking functionality. The first pillar consists of A-Z coverage of the scope and substance of Private International Law in the form of 247 entries. The second pillar comprises detailed overviews of the Private International Law regimes of 80 countries. The third pillar presents valuable, and often unique, English language translations of the national codifications and Private International Law provisions of those countries. This invaluable combination represents a powerful research tool and an indispensable reference resource.
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Norway

I. Sources of private international law

1. Major legislation

Private international law is largely uncodified in Norway, apart from certain choice-of-law rules in specific sectors that are mainly based on international conventions or European Directives. Thus, the Act on the Law Applicable to the International Sale of Goods (Act of 3 April 1964, No 1) is based on the Hague Sales Convention (Hague Convention of 15 June 1955 on the law applicable to international sales of goods, 510 UNTS 147), the choice-of-law rule in ss 1-4 of the Product Liability Act (Act of 23 December 1988, No 104) is based on the Hague Products Liability Convention (Hague Convention of 2 October 1973 on the law applicable to products liability, 1056 UNTS 191), the choice-of-law rules on carriage by sea in the Maritime Code (Act of 24 June 1994, No 39) are based on the Hague-Visby Rules (International Convention for the Unification of Certain Rules of Law Relating to Bills of Lading signed at Brussels, 25 August 1924, as amended by the 1968 Visby Protocol and the 1979 Brussels Protocol), the choice-of-law rules Arbitration Act contained in ss 31, 43 and 46 of the 2004 Arbitration Act (Act of 14 May 2004, No 25) are based on the UNCITRAL Arbitration Model Law (United Nations Commission on International Trade Law, UNCITRAL Model Law on International Commercial Arbitration as adopted on 21 June 1985 and as amended on 7 July 2006, UN Doc A/40/17 and A/61/17; →Arbitration, (UNCITRAL) Model Law), and rules on jurisdiction and recognition and enforcement of civil judgments are based on the 2007 →Lugano Convention (Lugano Convention of 30 October 2007 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, [2007] OJ L 339/3, which replaces its predecessor of 1988).

In addition, certain choice-of-law rules have been codified as a consequence of the Agreement on the European Economic Area, signed in 1992 and entering into force in 1994 (Agreement on the European Economic Area [1994] OJ L 1/3). Norway is not a member of the European Union, but pursuant to the EEA Agreement it committed itself to implementing the European rules relating to the four freedoms of movement within the internal European market. Civil cooperation, including private international law, is defined as falling outside the scope of the EEA Agreement. However, in connection with the implementation of instruments relating to the internal European market, some choice-of-law rules contained in European Directives have been implemented in Norway. The most important choice-of-law rules to be codified in Norway in consequence of the EEA Agreement are the Act on Choice of Law for Insurance Contracts (Act of 27 November 1992, No 111), based on the European Directives on insurance (Directive 88/357/EEC of 22 June 1988 on the coordination p. 1of laws, regulations and administrative provisions relating to direct insurance other than life assurance and laying down provisions to facilitate the effective exercise of freedom to provide services and amending Directive 73/239/EEC, [1988] OJ L 172/1 and Council Directive 90/619/EEC of 8 November 1990 on the coordination of laws, regulations and administrative provisions relating to direct life assurance, laying down provisions to facilitate the effective exercise of freedom to provide services and amending Directive 79/267/EEC, [1990] OJ L 330/50) (these rules are now part of the Rome I Regulation (Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I), [2008] OJ L 177/6; →Rome Convention and Rome I Regulation (contractual obligations))), the choice-of-law rule contained in s 3 of the Commercial Agency Act (Act of 30 June 1916, No 1), based on the European Directive on Commercial Agency 86/653/EEC(European Council Directive (86/653/EEC) of 18 December 1986 on the coordination of the laws of the Member States relating to self-employed commercial agents, [1986] OJ L 382/17), the choice-of-law rule in s 3 of the Consumer Sales Act (Act of 21 June 2002, No 34), based on the Consumer Sales Directive (Directive 1999/44/EC of the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer goods and associated guarantees, [1999] OJ L 171/12), the choice-of-law rule in s 3 of the Financial Contracts Act (Act of 25 June 1999, No 46), based on the Consumer Credit Directive (Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC, [2008] OJ L 133/66), the choice-of-law rule in s 5 of the Right of Withdrawal Act (Act of 20 June 2014, No 27), based on the Consumer Rights Directive (Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council, [2011] OJ 304/64), the choice-of-law rule contained in s 37 of the Contracts Act (Act of 31 May 1918, No 4), based on the Unfair Terms Directive (Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, [1993] OJ L 95/29), the choice-of-law rule contained in s 5 of the Time Share Act (Act of 25 May 2012, No 27), based on the Timesharing Directive (Directive 94/47/EC of the European Parliament and the Council of 26 October 1994 on the protection of purchasers in respect of certain aspects of contracts relating to the purchase of the right to use immovable properties on a timeshare basis, [1994] OJ L 280/83).

The interesting feature in relation to this is that the choice-of-law rules contained in the EU Directives, adopted in Norway by virtue of the EEA Agreement, are in turn based on the general instruments on private international law adopted in Europe, namely the Rome Convention (Rome Convention on the law applicable to contractual obligations (consolidated version), [1998] OJ C 27/34), which has been substituted by Council Regulation 593/2008, the so-called Rome I Regulation (→Rome Convention and Rome I Regulation (contractual obligations)). However, Norway has no general codification comparable to the Rome Convention or the Rome I Regulation, nor does it have the case-law or literature that might arise out of such a systematic form of codification. Therefore, in the Norwegian system it is possible to observe fragments of European private international law implemented on the basis of certain Directives, but without creation of a more exhaustive private international law infrastructure that usually follows those specific choice-of-law rules.

In 2003, the Norwegian Ministry of Justice showed interest in the then ongoing work in Europe to replace the Rome Convention with the Rome I Regulation, and it opened a public consultation regarding the Green paper issued by the European Commission (Green Paper on the conversion of the Rome Convention of 1980 on the law applicable to contractual obligations into a Community instrument and its modernization, COM(2002) 654 final) in that connection. In its notice, the Ministry affirmed that it was awaiting the issuance of the two expected European Council Regulations on →choice of law for contractual and for non-contractual obligations (respectively, Rome I Regulation and →Rome II Regulation (non-contractual obligations) (Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II), [2007] OJ L 199/40), before it would resume its work on p. 1a general codification of private international law. The Ministry affirmed that harmonization of choice-of-law rules was highly important and that the European rules would consequently have a substantial bearing on the development of the Norwegian codification system.

The two European Regulations were issued in 2007 (Rome II Regulation) and 2008 (the already mentioned Rome I Regulation), but the Norwegian Ministry has yet to resume its codification work. Commentators encourage the Ministry to revive its engagement in this area.

2. International conventions

Norway has ratified a number of international conventions relating to the field of private international law. In addition to the international conventions mentioned in section I.1 above, the following should be mentioned: the 1931 Nordic Convention containing certain provisions of private international law on →marriage, adoption and guardianship (Convention of 6 February 1931 containing certain provisions of private international law regarding marriage, adoption and guardianship, with final Protocol, 126 LNTS 121), the 1932 Nordic Convention on Recognition and Enforcement of Nordic Judgments in Civil Matters (Convention of 16 March 1932 regarding the recognition and enforcement of judgments, 139 LNTS 165), the 1933 Nordic Convention on Bankruptcy (Convention of 7 November 1933 regarding bankruptcy, 155 LNTS 115), the 1934 Nordic Convention on Succession and Wills (Convention concerning inheritance, testamentary dispositions and the administration of estates of deceased persons) of 19 November 1934, 164 LNTS 243, amended 1975 (amended by a new Convention 1 June 2012, which has not yet entered into force)), the 1962 Nordic Convention on Recovery of Maintenance (Convention of 23 March 1962 concerning the recovery of maintenance contributions, 470 UNTS 43), the 1974 Nordic Convention on Mutual Assistance in Judicial Matters (Agreement of 26 April 1974 concerning mutual legal assistance, 900 UNTS 377) as well as various Hague Conventions, primarily the Hague Divorce and Separation Convention (Hague Convention of 1 June 1970 on the recognition of divorces and legal separations, 978 UNTS 399), the Hague Testamentary Dispositions Convention (Hague Convention of 5 October 1961 on the conflicts of laws relating to the form of testamentary dispositions, 510 UNTS 175) and the Hague Child Abduction Convention (Hague Convention of 25 October 1980 on the civil aspects of international child abduction, 1343 UNTS 89). In addition, it is worth mentioning that Norway is a contracting state to the New York Convention (New York Convention of 10 June 1958 on the recognition and enforcement of foreign arbitral awards, 330 UNTS 3), as well as the European Foreign Law Convention (European Convention of 7 June 1968 on information on foreign law, 720 UNTS 147) with the Additional Protocol of 15 March 1978 to the European Convention on Information on Foreign Law, 1160 UNTS 529. It should also be mentioned that Norway is a contracting state to the CISG (United Nations Convention of 11 April 1980 on contracts for the international sale of goods, 1489 UNTS 3), which, while not containing any choice-of-law rule, has an impact on the applicability of private international law rules.

3. Significance of EU private international law

As mentioned earlier, Norway is not a member of the European Union. Therefore, the EU private international law regulations are not applicable in Norway. However, Norway has a close cooperation with the EU that resulted among others in the EEA Agreement mentioned in section 1 above. As mentioned, although the EEA Agreement does not cover private international law, certain EU Directives that were implemented into Norwegian law in the framework of the EEA Agreement contained choice-of-law rules. These choice-of-law rules have become part of Norwegian legislation, although as they are based on EU Directives, they are interpreted in conformity with EU private international law.

Moreover, Norway ratified and implemented the Lugano Convention. The Lugano Convention is a convention paralleling EU Regulation 44/2001, the so-called Brussels I Regulation (Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, [2001] OJ L 12/1; →Brussels I (Convention and Regulation)), and is intended to provide Iceland, Norway and p. 1Switzerland with a regime equal to the regime applicable in the EU. According to Protocol No 2 to the →Lugano Convention (Protocol 2 on the uniform interpretation of the Convention and on the Standing Committee, [2007] OJ L 339/27), the Lugano Convention is to be interpreted in conformity with the Brussels I Regulation. Following the amendments to the Brussels I Regulation (Brussels I Regulation (recast), Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast), [2012] OJ L 351/1) that entered into force in 2015, negotiations were initiated to amend the Lugano Convention so as to preserve the parallelism now existing between the two instruments. These negotiations are not finalized as of June 2015.

Finally, court practice and legal literature have recently emphasized that EU private international law should be taken into consideration when establishing the content of Norwegian private international law, as will be discussed in section II.

4. Role of case-law

Due to the scarcity of statutory provisions in the field of private international law, case-law assumes an important role in the development of this field. Section II describes the development of court practice within private international law.

5. Role of scholarly writing

Scholarly writings do not play a significant role as a source of law in the Norwegian legal system. Writings of legal scholars may largely be referred to as corroboration of a certain reasoning put forth by the court. In the field of private international law, where codification is scarce, legal writings may be more relevant than is other areas.

II. History and development of private international law

1. Traditional approach in favour of flexibility

In the past, Norwegian courts have been somewhat reluctant to apply general →connecting factors when determining the applicable law. While court practice has mainly determined the applicable law on the basis of the principle of the closest connection, it has not understood this as an objective connecting factor, but rather as a basis for evaluating the circumstances as a whole in the specific case without expressing which criteria are relevant to determining the connection – the so-called individualizing method.

The principle of the closest connection was first mentioned in a decision from 1923 (Rt. 1923 II 58, known as Irma-Mignon). According to this decision, a relationship is governed by the law of the country with which it has the closest connection. The Irma-Mignon formula was applied irrespective of the nature of the claim. In the actual case, the claim was based on tort as a consequence of a collision between two Norwegian vessels in foreign waters. The Supreme Court decided to apply Norwegian law, rather than the law of the country where the accident took place, because the common nationality of the vessels rendered the connection with Norway stronger than the connection with the country where the tort occurred. The same formula was also applied in disputes concerning other areas of the law, such as contract law (see, for example, Rt 1980 s 243).

The rule of the closest connection is traditionally used for rendering ad hoc decisions based on varying or non-specified criteria, which explains why this approach is known as the individualizing method. By contrast, the few general connecting factors that are codified are used restrictively. Consequently, the already mentioned Act on the Law Applicable to the International Sale of Goods, modelled on the Hague Sales Convention, was used only selectively as a basis for analogy. The Act contains among others two connecting factors for contracts of sales. One is →party autonomy, which gives the parties the power to choose the applicable law. The other, where the parties fail to exercise such autonomy, is the habitual residence (→Domicile, habitual residence and establishment) of the seller (ie of the party effecting the characteristic performance). Norwegian courts have repeatedly extended the Act’s rule on party autonomy analogously to other contract types. However, they have never extended the connecting factor of the seller’s habitual residence by analogy. On the contrary, courts have openly affirmed that such a connecting factor is not to be extended by analogy, without explaining the reason for this restriction (Rt 1980 s 243, Rt 1982 s 1294). Absent a choice by the parties, Norwegian courts traditionally applied the p. 1individualizing method and looked for an ad hoc solution in each particular case, rather than relying on a connecting factor of general validity.

2. Emerging trends in favour of legal certainty

European private international law seems to be gradually exercising a degree of influence on Norwegian courts. In Rt 2006 s 1008, the Supreme Court was confronted with the question of jurisdiction in a dispute regarding an agency agreement (→Agency and authority of agents; →Commercial agency, franchise and distribution contracts). Jurisdiction for contract obligations is regulated in Norway by the already mentioned Lugano Convention, art 5(1) of which referred to the courts in the place of the performance of the obligation in question. In the version of the Convention prevailing at the time of the decision, the →place of performance had to be determined according to the law applicable to the contract. Hence, the Supreme Court needed to designate the law applicable to the contract. The parties had made no →choice of law and the court expressly made reference to European private international law, mentioning art 4(2) of the (then applicable) Rome Convention and stressing that the decisive connecting factor was the agent’s place of business. This connecting factor is confirmed and even enhanced in art 4 Rome I Regulation, the successor to the Rome Convention, that in art 4(2) transformed into a general rule the connecting factor of the habitual residence of the party effecting the characteristic performance, which was a mere presumption in the Rome Convention.

The court went on to mention a series of additional aspects that might have been considered relevant in an ad hoc evaluation of a specific relationship. The court pointed out that these aspects could not be applied under an evaluation based on the place of business of the party effecting the characteristic performance. Thus, the Supreme Court seems to be abandoning the traditional individualizing method and rather embracing a general connecting factor, at least in the field of agency contracts (→Agency and authority of agents; →Commercial agency, franchise and distribution contracts).

This is a clear evolution from the above mentioned (section II.1) rejection by the Supreme Court to apply analogously the connecting factor of the residence of the party effecting the characteristic performance, as codified in the Act on the Law Applicable to the International Sale of Goods. Reasons of harmonization, both with European private international law and with internal Norwegian legislation, significantly influenced as already seen by European law, speak for the advisability of embracing the same connecting factor for all contractual obligations.

The same attention to European choice-of-law rules is shown even more expressly in a newer decision of the Supreme Court in a defamation case, Rt 2009 s 1537, known as the Bookseller of Kabul decision. The case concerned a book published in Norway describing the life of a bookseller and his family in Kabul. The book was translated into numerous languages and became a bestseller in many countries, including Afghanistan. The bookseller and his family claimed that the description was defamatory and was capable of creating substantial harm for him and his family in Afghanistan, and they sued the author and the publisher in Norway. The Supreme Court pointed out that it was not necessary to make a decision as to which law governed the case, because it had turned out to be extremely difficult to obtain sufficient information on the content of Afghan law, so that it was necessary to apply Norwegian law (pursuant to s 11 of the Civil Procedure Act (Act of 17 June 2005, No 90). This part of the decision has been strongly criticized, but of interest here is that the Supreme Court delivered an extensive obiter dictum with general observations on the method to be followed when determining the applicable law. The Supreme Court criticized its own previous practice, and underlined the importance of operating with general and predictable choice-of-law rules. Furthermore, the Supreme Court affirmed that European choice-of-law rules should also be taken into consideration in Norway when there are no codified Norwegian rules. The Supreme Court pointed out that the traditional individualizing method should be abandoned in favour of general and predictable rules. In clear contrast to its previous statement that ‘unless Norwegian legislation or judicial practice answer the question, it will be necessary to assess what would be the most natural and fairest solution’ (Rt 2002 s 180, known as Leros Strength, at p 186) the Supreme Court now states: ‘unless we have differing legislation, in the interest of harmonization when determining the applicable law we should take into consideration the solution that p. 1EU countries have chosen’ (Bookseller of Kabul case, para 34).

Admittedly, the most extensive argumentation in favour of predictability was only made by the Supreme Court in an obiter dictum in the Bookseller of Kabul case, whereas the ratio decidendi of that decision takes a different line. Nevertheless, in the Bookseller of Kabul case the Supreme Court has explained how the applicable law should be determined on the basis of objective criteria and how reasons of predictability and harmonization render it advisable to consider the same criteria that are codified in European private international law. However, due to the difficulty in ascertaining the content of one of the potentially applicable laws, the particular case at hand was deemed by the Supreme Court to be inappropriate for applying the method of choice of law that the court recommended.

The obiter dictum on the necessity of applying objective criteria and a predictable method subsequently received due attention. In a later decision, Rt 2011 s 531, the Supreme Court referred repeatedly to the argumentation of the Bookseller of Kabul case.

Admittedly, also in regard to this case, the court found that the particular case at hand was not appropriate for applying the objective connecting factor of the choice-of-law rule that it deemed applicable, but this seemed to be more a question of applicability of that particular choice-of-law rule, rather than a fundamental criticism of the method involved.

In this later case, involving crimes committed during the conflicts in Bosnia and Herzegovina in 1992, the claim concerned reimbursement of →damages as a consequence of war crimes committed abroad. Norwegian courts had jurisdiction on the basis of the principle of universal criminal jurisdiction for serious human rights violations. Connected with the criminal action was a civil claim for reimbursement of damages, and in this connection the court referred to the obiter dictum in the Bookseller of Kabul decision and considered the objective criteria contained in both Norwegian and EU rules on choice of law for obligations arising out of non-contractual obligations. Both rules use the connecting factor of the place where the damage occurred, and this would have led to the application of Bosnian law. The court, however, questioned the applicability of this choice-of-law rule to this particular case, based on reasoning that has been criticized in legal literature. The court resorted to criteria that, in its opinion, made it necessary to apply Norwegian law (primarily the close connection between the claim and Norwegian criminal jurisdiction and criminal law). Unfortunately, the court refrained from formulating this as a general choice-of-law rule that would apply to claims for reimbursement of damages arising out of criminal actions in general. Also, the court stressed the need to apply a discretionary and ad hoc approach in this particular case and even affirmed that the individualizing method has to be considered the main choice-of-law rule in Norwegian law. However, the reasoning developed by the court was sufficiently clear to show which criteria were applied and should therefore be readily usable as a basis for similar decisions in the future. Therefore, the court ultimately did not apply the individualizing method. More interestingly, the court followed and reaffirmed the reasoning of the Bookseller of Kabul obiter dictum in respect of the function and use of overriding mandatory rules (→Overriding mandatory provisions) or ordre public. Under Bosnian law, the claim would have been time-barred. Moreover, the claim should have been directed against the state and not against the perpetrator of the crime. This would have prevented the Norwegian courts from ordering reimbursement of damages, which in turn would have violated the Norwegian sense of justice as well as the private international law standards in this field. If the court had followed its traditional approach, it would have considered it redundant to carry out the connecting factor evaluation and it would have argued that Norwegian law should be applied because of the importance of the involved policy. The court, however, referred to the explanation given in Bookseller of Kabul obiter dictum and confirmed that the ordre public exception should not be used to avoid the process of choosing the applicable law, but only to prevent unacceptable results after the applicable law has been designated.

3. Ordre public and overriding mandatory rules

Application of the law designated by the relevant choice-of-law rules will be limited if it results in an intolerable violation of the basic principles on which the Norwegian system is based. This is expressly set forth in s 6 Act on the Law Applicable to the International Sale of Goods, and is recognized as an underlying p. 1principle in all areas of law. This is in line with the Rome I Regulation, which contains a similar provision in art 21, as did the previous Rome Convention in its art 16.

Commentators agree on the need to interpret the ordre public exception very narrowly. The ordre public (or public policy) clause (→Public policy (ordre public)) is not intended to be used whenever there is a discrepancy between the foreign governing law and the Norwegian legal system. Rather, the clause is to be used only under exceptional circumstances, when the result that the judge would arrive at by applying the rule of the foreign governing law would conflict with the basic principles upon which Norwegian society is based. Among other things, this entails that public policy may not be used as a basis to skip the process of finding the applicable law and to apply Norwegian law instead, only because these rules are deemed to be important or preferable to the corresponding foreign rules (see below in this section). The public policy exception is in place to prevent unacceptable results, not to achieve an accurate application of the court’s own provisions or even to ensure full application of the court’s law.

This restrictive application of the ordre public exception is consistent with the restrictive use of public policy in related areas; namely, in relation to the recognition and enforcement of civil court decisions (regulated by the Lugano Convention), as well as the annulment of arbitral awards rendered in Norway and the recognition and enforcement of foreign arbitral awards (regulated, respectively, in ss 43 and 46 of the Arbitration Act, based on the UNCITRAL Arbitration Model Law (→Arbitration, (UNCITRAL) Model Law) and on the New York Convention). Based on international instruments, these codified rules on ordre public have to follow the narrow interpretation that prevails at the international level. For internal consistency, a similarly narrow interpretation of the ordre public exception should be applied in the field of →choice of law.

A further limitation to the applicability of the law designated by the relevant choice-of-law rules are the so-called overriding mandatory rules. These are rules implementing particularly important policies and they are directly applicable, notwithstanding that the choice-of-law rules designate another law as the governing law. The direct applicability of overriding mandatory rules is also regulated in art 9 of the Rome I Regulation, as it was in art 7 of its predecessor, the Rome Convention.

It is important to point out that the applicable law should be overridden only in exceptional situations. Far from all mandatory rules have an overriding character, as Recital (37) of the Rome I Regulation expressly highlights.

The already mentioned Supreme Court decision in the Leros Strength case (Rt 2002 s 180) dealt with one of these overriding mandatory rules. Leros Strength, a Cyprus-registered bulk vessel, insured with an English P&I company, sank in February 1997 in Norwegian waters. Several kilometres of the Norwegian coast were polluted by the oil spilled, and the Norwegian state incurred costs of several million Crowns for cleaning and remediation of the damage caused by the oil spill. The Norwegian state filed a suit with the local court against the shipowner and the insurer in order to recover the clean-up costs. The shipowner accepted the forum. However, the insurer objected to the jurisdiction of the Norwegian courts. The insurance policy between the shipowner and the English insurer was governed by English law, according to a choice-of-law clause contained in the terms and conditions thereof. The terms and conditions also contained a ‘pay-to-be-paid’ clause, which is quite usual in such situations, and is acceptable under English law. According to this clause, the insured shipowner cannot claim payment from the insuring company before the shipowner has reimbursed the injured party for the damage it has caused. According to the pay-to-be-paid clause, therefore, the injured party has no right to →direct action against the insurer, because the payment obligation of the insurer does not arise until the injured party has received payment from the insured party. Under Norwegian law, however, the injured party has the right to direct action against the insurer under certain circumstances. In particular, if the shipowner is insolvent (as was the case here), the rules on direct action are mandatory.

The forum for insurance claims is regulated by the Lugano Convention. For direct action against the insurer the courts of the place of the damage are competent ‘when such direct actions are allowed’. Whether the direct action is allowed depends on the law governing the claim. Hence, the issue of the jurisdiction could not be resolved before having determined what p. 1law governed and whether or not direct actions were allowed under that law.

The preparatory work on the Norwegian Act on Choice of Law for Insurance Contracts (Act of 27 November 1992, No 111) specifically mentions this rule on direct action as one of the rules that, according to the act’s s 5, are likely to have an overriding character, and thus have to be complied with even if the underlying situation is international and subject to a foreign law (Ministry of Justice’s proposal to Parliament of (inter alia) an Act on Choice of Law for Insurance Contracts, Ot prp nr 72 (1991–92) at p 66). The rule of s 5 originates from the European Directives on insurance, which in this particular instance were an implementation in the insurance sector of the principle on overriding mandatory rules that underlied art 7 of the (then prevailing) Rome Convention. These rules are now incorporated in art 7 Rome I Regulation.

The Supreme Court in Leros Strength instructed the lower court to consider, when assessing the question of the applicable law, the nature of the claim and the policy underlying Norwegian rules applicable in the area if law concerned. The Supreme Court seemed to imply that the determination of the governing law may be steered by how important the policy is.

In its decision on the Bookseller of Kabul, the Supreme Court later criticized its own reasoning in Leros Strength and affirmed that Norwegian courts should also consider the principles underlying European private international law regarding the function of ordre public and overriding mandatory rules (para 38). Thus, as already mentioned, the Supreme Court abandoned the approach according to which the importance of certain rules could be invoked as an excuse to avoid the process of choosing the applicable law. Commentators had already criticized Leros Strength for having used the policy underlying the substantive rules of Norwegian law to skip the process of determining the applicable law. The Supreme Court reiterated similar reasoning in the field of ordre public in the War Crimes case (Rt 2011, s 531).

III. Administration of private international law

1. Courts and non-judicial authorities

There are no courts specialized in private international law matters, so that such matters typically fall within the scope of the general jurisdictional powers of the courts. The Civil Procedure Act permits to decide the question of the applicable law separately (s 16-1); therefore, it is possible that a decision on choice of law is independently appealed up to the Supreme Court.

The question of the applicable law is to be raised and decided by the courts ex officio (s 11-3 Civil Procedure Act).

2. Application of foreign law

If the applicable choice-of-law rules direct a court to apply foreign law, the court is to ascertain the content of the foreign law ex officio. The parties may assist the court by providing explanatory material; however, it is necessary to obtain the other party’s consent to produce a legal opinion on the content of the applicable foreign law, if the opinion was produced specifically for the purpose of that proceeding (s 11-3 Civil Procedure Act). The court may by its own motion appoint an expert to explain the content of foreign law. If it is not possible to ascertain sufficiently the content of the applicable foreign law, Norwegian law will be applied (s 11-3 Civil Procedure Act).

IV. Basic principles of jurisdiction

The international jurisdiction of Norwegian courts is regulated in s 4-3 to 4-8 Civil Procedure Act and in the →Lugano Convention. The Civil Procedure Act was largely modelled after the Lugano Convention, and is applicable outside of the scope of application of the Convention (s 4-8). The Lugano Convention is modelled on the EU Brussels I Regulation, and the European Court of Justice’s practice regarding Brussels I is to be taken into due consideration when interpreting the Lugano Convention in order to ensure that the two instruments are applied uniformly.

1. General structure

As a general rule, a party may always be sued in the courts of the place where it has its domicile or seat (s 4-4 Civil Procedure Act and art 2 Lugano Convention; →Domicile, habitual residence and establishment). In addition, parties may agree to submit to the jurisdiction of Norwegian courts (s 4-6 Civil Procedure Act and art 23 Lugano Convention). The Civil Procedure Act contains no exclusive fora; whereas the p. 1Lugano Convention has a small number of exclusive fora (arts 22 and 23).

According to court practice, which is criticized by some commentators, courts have a certain margin of discretion when determining their jurisdiction according to the Civil Procedure Act. This means a court might dismiss a case if it deems that case’s connection with Norway is not sufficient, even if a connecting factor listed in the Civil Procedure Act points at Norwegian courts. Similarly, a court might accept jurisdiction on a case even if none of the connecting factors points at a Norwegian court. Within the scope of the Lugano Convention, courts have no discretion and are bound by the grounds of jurisdiction set forth in the Convention.

2. Obligations

Claims relating to →contractual obligations may be raised before the courts of the defendant’s domicile and before those of the →place of performance of the obligation in question (s 4-5(2) Civil Procedure Act), unless the obligation in question is the obligation to make a payment and the defendant is domiciled in Norway. In contracts of sale and of service, the Lugano Convention gives jurisdiction to the courts of the place of performance of the characteristic performance (art 5(1)). For weaker parties that are deemed to deserve special protection (consumers, employees, the insured or beneficiary), there are special heads of jurisdiction.

Claims relating to non-contractual obligations may be raised before the courts of the defendant’s domicile, not unlike contractual claims, and before the courts of the place where the harmful event was caused or where it occurred (s 4-5(3) Civil Procedure Act and art 5(3) Lugano Convention).

3. Property rights

In the Civil Procedure Act there are no special rules on jurisdiction in relation to claims concerning movable property (→Property and proprietary rights). However, s 4-5(1) Civil Procedure Act provides an alternative forum for any actions relating to →immovable property: the court of the place where the immovable property is located. The Lugano Convention grants Norwegian courts exclusive jurisdiction for rights in rem in immovable property that is located in Norway (art 22(2)).

4. Corporations

In the Civil Procedure Act there are no special rules on jurisdiction for actions relating to corporate matters. The Lugano Convention grants Norwegian courts exclusive jurisdiction for actions regarding the validity of the constitution of corporations, the nullity or the dissolution of Norwegian →companies, or the validity of the decisions of their organs (art 22(2)). For issues of corporate law not falling within the exclusive forum, the general rule of the defendant’s forum will apply, unless the issues can qualify as contractual or tort matters and the provisions on the relevant alternative fora may be applicable.

5. Family matters

According to s 30(b) Marriage Act, Norwegian courts have jurisdiction regarding matters relating to →marriage, if the respondent is domiciled in Norway, if the claimant is domiciled or has lived in Norway and would be unable to bring the claim in his or her country of domicile, if both spouses are Norwegian nationals and they agree on Norwegian jurisdiction, if the claim is based on a separation registered in Norway, if the marriage was celebrated in Norway and the claimant would be unable to bring the claim in the country of his or her domicile or in the country of his or her →nationality.

The 1931 Nordic Convention containing certain provisions of private international law on marriage, adoption and guardianship, as amended in 2006, applies to nationals of Nordic countries (→Denmark, →Finland, →Iceland, Norway and →Sweden) who reside in a Nordic country. Article 7 contains rules on jurisdiction for claims of separation or divorce, and lists various alternative fora, among others the place of common domicile, the last common domicile if one of the spouses still lives there, the place of common nationality, the domicile of the respondent, etc.

6. Succession

According to s 4-5(6) Civil Procedure Act and s 8 Probate Administration Act, Norwegian courts have jurisdiction if the deceased had his or her last domicile (which is not necessarily the same as the last habitual residence (→Domicile, habitual residence and establishment)) in p. 1Norway. It must be noted that a reform of this area is expected, which will probably require habitual residence as a ground for jurisdiction (see Norwegian Official Reports, NOU 2007:16).

The 1934 Nordic Convention on Inheritance applies to nationals of Nordic countries (Denmark, Finland, Iceland, Norway and Sweden) who resided in a Nordic country when they deceased. The Convention gives jurisdiction to Norwegian courts, if the last domicile of the deceased was in Norway.

V. Basic principles of choice of law

1. General provisions

As mentioned, there is no general codification of choice-of-law rules in Norway. Traditionally, court practice has determined the applicable law on the basis of the so-called individualizing method. Recently, court practice has expressed the intention to abandon this highly discretional approach and to adopt general →connecting factors modelled after EU choice-of-law rules, at least in the field of obligations. In addition, a few choice-of-law rules are codified as a consequence of the EEA Agreement or the ratification of international conventions (see section I.1 above).

2. Obligations

For obligations relating to sales contracts, according to s 3 1964 Act on the Law Applicable to the International Sale of Goods, the main connecting factor is →party autonomy, ie the parties may freely choose the applicable law. Party autonomy is considered as the main choice-of-law rule for all contractual obligations – either as a consequence of an analogous extension of this section to other contracts or as a consequence of a general principle in private international law. If the parties have not chosen the applicable law, contracts of sale are subject to the law of the seller (s 4). Other contracts were traditionally subject to the law that the court in its discretion deemed to be the one most closely connected to the contract. Recent court practice seems to follow the advice of commentators and to apply general connecting factors corresponding to those contained in the Rome I Regulation. For contracts involving a weaker party (consumer, employee, insured party or beneficiary), the implementation of EU Directives following the EEA Agreement has introduced choice-of-law rules largely corresponding to those of the Rome I Regulation. It is assumed that similar rules apply also outside the scope of application of the EEA Agreement.

For non-contractual obligations, court practice has generally applied the law of the place where the damage occurred, with some exceptions (notably, if both involved parties come from Norway and the damage occurred in another country). Traditionally, the law of the place of the damage has been chosen as a result of the court’s discretionary evaluation. Recent court practice seems to follow the opinion expressed by commentators and to apply general connecting factors corresponding to those contained in the Rome II Regulation.

3. Property rights

Traditionally, courts have applied the law of the place where the property is located, both in respect of moveble and immovable property. Literature points out that this law is applicable to the existence, extent and validity of a property right, whereas the contractual rights and obligations between the parties are subject to the law applicable to contractual obligations.

4. Corporations

There are no clear sources of private international law of corporations. A few sources seem to indicate that companies have traditionally been deemed to be subject to the law of the place where they have their main seat. However, it is unclear how the location of the main seat should be established. Commentators now seem to be unanimously in favour of the theory according to which companies are subject to the law of the place of registration, based among other reasons on EU court practice on freedom of establishment (→Freedom of establishment/persons (European Union) and private international law).

5. Family matters

Generally, the connecting factor for a person’s legal capacity and name is that person’s habitual residence.

According to s 7(h) Marriage Act, the conditions for marriage in Norway are regulated by Norwegian law, and foreign nationals not residing p. 1in Norway have to provide documentation that they are not married in their home country.

According to consistent court practice, the patrimonial regime between spouses is subject to the law of the place where the spouses had their first common habitual residence. Any subsequent change of residence will not affect the applicable law. This principle is derogated in the 1931 Nordic Convention containing certain provisions of private international law on marriage, adoption and guardianship, as amended in 2006, that applies to nationals of Nordic countries (Denmark, Finland, Iceland, Norway and Sweden) who reside in a Nordic country. According to the Convention, the patrimonial regime of the spouses will be subject to the law of the new common residence after a two-year period has elapsed.

According to a recent Supreme Court decision (HR-2007-00194-U (not published)), spouses have the possibility to choose the law applicable to their patrimonial regime. The Nordic Convention permits a restricted party autonomy.

6. Succession

Succession is subject to the law of the deceased’s last habitual residence. It must be noted that a codification of this area is expected, that will probably confirm habitual residence as a connecting factor (see NOU 2007:16).

The 1934 Nordic Convention on Inheritance applies to nationals of Nordic countries (→Denmark, →Finland, →Iceland, Norway and →Sweden) who were resident in a Nordic country at the time of death. Succession is subject to the law of the place where the deceased had his or her last domicile (→Domicile, habitual residence and establishment), or, had the deceased not lived there for the last five years and upon the request of an heir, to the law of the deceased’s →nationality. Effective as of 2015, the Nordic Convention will have rules that are closer to EU rules, in that the main connecting factor will be the deceased’s last habitual residence, unless he or she had a manifestly closer connection to another contracting state.

VI. Recognition and enforcement of judgments

The Civil Procedure Act has a rule on recognition and enforcement of foreign judgments that were rendered by a court to which the parties had submitted by agreement (s 19-16(2)). These judgments are enforceable in Norway, unless they conflict with Norwegian →public policy (ordre public). Where the parties had not agreed on jurisdiction of the foreign court, foreign judgments have no effect in Norway, unless there is a statutory provision or an international treaty to that effect. The main convention on the recognition and enforcement of foreign judgments to which Norway is party is the →Lugano Convention. In addition, the Act on Recognition of Foreign Divorce and Separation (Act of 2 June 1978, No 38) should be mentioned. This Act is based on the 1931 Nordic Convention containing certain provisions of private international law on marriage, adoption and guardianship and the Hague Divorce and Separation Convention. Also the 1932 Nordic Convention on Recognition and Enforcement of Nordic Judgments in Civil Matters should be mentioned. It leads to the automatic recognition of judgments falling under its purview, with only limited exceptions.

VII. Arbitration

The 2004 Arbitration Act is based on the UNCITRAL Arbitration Model Law (→Arbitration, (UNCITRAL) Model Law). The choice-of-law rule for the merits of the dispute is contained in s 31, and it states that the arbitral tribunal shall apply the law chosen by the parties or, failing such choice, the law determined by Norwegian private international law. Norway is a party to the 1958 New York Convention. Any reservations made to restrict the application of the Convention have become irrelevant since the regime of the Convention has been codified in the Arbitration Act, and the Act’s regime for recognition and enforcement of arbitral awards applies to any award without restrictions.

Giuditta Cordero-Moss

Literature

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