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#TodayInDispute provides you with the latest updates in the field of dispute resolution and can also be received via LinkedIn and Twitter.

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17.07.2020 #TodayInDispute: The EU-U.S. Privacy Shield is history. The ECJ ruled in its Schrems II decision (C-311/18) that the EU-U.S. Privacy Shield, a transatlantic agreement for transfer of personal data between EU and U.S., does not provide adequate data protection. The Court especially pointed out that the Privacy Shield did not limit data access and use by U.S. public authorities “in a way that satisfies requirements that are essentially equivalent to those required under EU law”. However, the Court also found that the EU Commission’s standard contractual clauses for the transfer of personal data to processors in third countries are valid under the GDPR regime. These standard contractual clauses, therefore, may provide an alternative for certain transatlantic EU-U.S. data transfer, which relied on the Privacy Shield so far. Click here for the judgment.

16.07.2020 #TodayInDispute: ECJ rules on jurisdiction in VW exhaust emission manipulation claims: The ECJ, upon request of the Regional Court Klagenfurt, Austria, gave a preliminary ruling on the interpretation of article 7(2) of the Brussels Regulation. Under this provision, a person may be sued in matter relating to tort or delict, in the courts of the place where the harmful event occurred. In the present case, an Austrian consumer protection association as claimant had sued VW in the context of the manipulation of exhaust emissions. The ECJ now clarified that if an Austrian customer purchases a VW car in Austria from a third party, the harmful event occurs “only when those vehicles were purchased, as they were acquired for a price higher than their actual value”. Consequently, it held that the harmful event occurs in the member state in which the vehicle was purchased from the third party. Click here for the judgment.

25.06.2020 #TodayInDispute: Following the deal struck between the EU Parliament and the Commission regarding the possibility collective redress for consumers, we are looking forward to the issue of the Directive. It will be interesting to see whether the new Directive will take up any of the points mentioned in our Position Paper of 11 June 2018, which can be accessed via the Commission’s homepage here.

24.06.2020 #TodayInDispute: EU Parliament and Council negotiators have reached a deal on the introduction of new rules on collective redress for consumers. As part of the Commission’s attempts to introduce a New Deal for Consumers launched in April 2018, the new rules will require each member state to introduce the possibility of a least one representative action procedure for injunction and redress, which will allow qualified entities to raise claims against companies violating consumer rights. The rules will apply in a wide range of sectors, from violations of EU financial services rules to violations of the rights of passengers by air or rail. Parliament as a whole and the Council will now have to approve the political agreement. Member states will then have 24 months to implement the directive. Click here to for the Parliament’s press release.

04.06.2020 #TodayInDispute “Plutos”: In 2012, Greece issued a law allowing existing Greek state bonds to be converted into new bonds with a lower nominal value. An Austrian claimant, who owned such converted Greek state bonds, initiated civil proceedings against the Greece in Austria claiming reimbursement of financial losses. The Austrian Supreme Court recently rejected the claimant’s arguments, noting, amongst other points, that the European Court of Human Rights has found that the Greek “hair cut” does not constitute a violation of the fundamental rights of property or equality in accordance with the European Convention on Human Rights. According to the Austrian Supreme Court, the same holds true for Article 17 of the Charter of Fundamental Rights of the EU. The Court therefore rejected the argument that the ECHR’s ruling only applied to Greek citizens. The Court also dismissed the argument that requiring an Austrian claimant to contribute to the restoration of another state’s finances would amount to a violation of the Austrian ordre public, since the claimant failed to demonstrate which national legal core values would be violated by the Greek measures. Click here for the full decision.

16.04.2020 #TodayInDispute: ECJ landmark decision regarding transfer of undertakings // The ECJ recently ruled that it is possible that a transfer of undertaking involves a number of transferees. Thus, the rights and obligations arising from one employment contract may be transferred to more than one transferee, in proportion of the tasks performed by the employee concerned, provided that a division of the employment contract is possible and does not cause a deterioration of working conditions or adversely affect the safeguarding of the employee’s rights. Where such a division is not possible, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship. This also applies if the termination is initiated by the employee. The ruling (in English) can be found here.

09.04.2020 #TodayInDispute: Continued duty of care after termination of employment // The Austrian Supreme Court recently confirmed that the employer’s duty of care towards the employee does not end with the termination of the employment but, in some extent, continues to apply post contractual. In the case at hand, the former employer sent a letter to his former employee in which he expressly pointed out the employee’s post-contractual obligations. However, instead of addressing the letter directly to the former employee, the letter was sent to the employee’s new employer. This resulted in the former employee not obtaining the desired position as managing director at his new employer. The Austrian Supreme Court considered that addressing such a letter to the new employer as violation of the still existing duty of care towards the former employee and ruled that the former employer was liable for the damages caused by this violation. The ruling (in German) can be found here.

20.03.2020 #TodayInDispute: Notification of pregnancy in a fixed-term employment // The Austrian Supreme Court recently ruled that the notification of the employer by the employee of a pregnancy two days after the end of a fixed-term employment contract does not have any effect on the employment relationship. It especially does not lead to a (retrospective) extension of the employment contract, as it would have been the case if the employer would have been informed before the contract expired. This especially applied since the employee had already been aware of the pregnancy for more than one month before the end of the employment relationship. However, the Austrian Supreme Court also pointed out that cases, where the employer is not notified due to legitimate reasons (e.g. employee was not aware of the pregnancy, etc), may lead to a suspension of the expiry of the contract and thus, to an extension of the fixed-term. The ruling (in German) can be found here.

26.02.2020 #TodayInDispute: "Challenging Arbitrators” Under Austrian arbitration law, in case of doubt regarding an arbitrator’s independence and impartiality, a party must challenge the arbitrator already in the course of the pending arbitration proceedings. If the parties only become aware of a potential bias of an arbitrator after an award has been rendered, the Austrian Supreme Court has previously held that parties can only rely on an arbitrator’s bias as ground for annulment of an award in “blatant” cases. In a recent decision, the Supreme Court deviated from this line of jurisprudence and held that the impartiality and independence of an arbitral tribunal is of utmost importance given the restrictive ground for annulment of an arbitral award. Therefore, parties can challenge an award based on an arbitrator’s bias also in “non-blatant” cases. However, the challenging party still has to prove that it was unable to initiate a challenge procedure before the award has been rendered. Read the full decision (in German) here.

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