WHAT WAS HAPPENING DURING JANUARY AND FEBRUARY 2015

Transcription

1 NEWSLETTER NO 51 Of the Association of Corporate Lawyers WHAT WAS HAPPENING DURING JANUARY AND FEBRUARY Application of EU Rules and Regulations in Civil and Commercial Matters 2. E-Announcement Board of Courts and Other Competent Bodies in the Republic of Croatia 3. Economy in the Light / Darkness of Laws (Yesterday, Today, Tomorrow) 4. Twenty Years of Application of the Trade Company Act in Interdisciplinary Environment 5. ICC Croatia: Financing of Trade Global rules, Practice and New Trends 1. Application of EU Rules and Regulations in Civil and Commercial Matters People have always traded, and where there is a trade, there is also a dispute. The purpose of each dispute is enforcement; it is as a final touch, cream on the cake or a goal in a sport. Therefore we would like to draw your attention exactly to the valid rules and regulations of the European Union to be applied to civil and commercial matters, the fact that has been actualised with the membership of the Republic of Croatia in the European Union. The following rules and regulations apply to recognition and enforcement of civil and commercial matters in the European Union: No Title of the rule and/or regulation Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. Regulation (EU) No 1215/2012 of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters Regulation (EC) No 805/2004 of 21 April 2004 creating a European Enforcement Order for uncontested claims Regulation (EC) No 1896/2006 of 12 December 2006 creating a European order for payment procedure Regulation (EC) No 861/ July 2007 establishing a European Small Claims Implementation Time 01/03/2002 In the Republic of Croatia from 01/07/2013 to 10/01/2015 *it applies to court decisions reached before 10/01/ /01/ In the Republic of Croatia since 01/07/ /12/2008 In the Republic of Croatia since 01/07/ /01/2009 In the Republic of Croatia since Decisions it refers to Court decisions Public Documents Court settlements Court decisions Public Documents Court settlements Court decisions, public documents, court settlements, authentic documents for uncontested claims uncontested cash claims Value of the Claim (value per dispute) up

2 Procedure 01/07/2013 to EURO 2000 The regulation under number 1 refers to decisions reached in a member states that are recognised in other member state (no special proceeding is required), but a proceeding is required to announce the decision enforceable. The regulation under number 2 refers to court decisions reached in a member state that are recognised in other member state without a special proceeding with that purpose and it is enforceable in other member state without requiring a certificate on enforceability. The regulation under number 3 refers to decisions that are confirmed as a European Order to be enforced in the member state of their origin and that are recognised and enforceable in another member state and the confirmation of its enforceability is not necessary. For regulation under the number 3 it is important to emphasise that the term uncontested claims understands claims agreed and accepted by the debtor, never contested by the debtor, due to which the debtor missed the hearing or accepted by the debtor in a public document. The regulation under number 4 refers to the European Payment Order enforceable in the member state of the origin that is to be enforced in another member state without the necessity of proclamation of its enforceability. The regulation under number 5 refers to decisions reached in a member state in the European Small Claims Procedure that are recognised and enforced in another member state and the confirmation of its enforceability is not necessary. It is important to point out that the creditor has the choice which regulation to apply for recognition and enforceability in each individual case. Prepared by: Iskra Gudan, LLB and Ana Zbiljski, LLB Končar - Electrical Industry, Inc. 2. E-Announcement Board of Courts and Other Competent Bodies in the Republic of Croatia One of more important amendments of the Civil Procedure Act published in the Official Gazette Narodne novine No 25/2013 was the provision on announcement of decisions and other documents on the web site court e-announcement board. Although almost two years have passed since those amendments became valid, the president of the Commercial Court of Zagreb reached the decision on 2 nd February, 2015 determining 10 th February, 2015 as the day when announcing of decisions and other documents of that court would start on the Court web site E-Announcement Board of Courts. The E-Announcement Board is a free of charge public service accessible from an application of the Ministry of Justice and it enables reviewing of electronic announcement boards of courts and other competent bodies of the Republic of Croatia. The project of the E Announcement Board of Courts is a part of the e-croatia 2007 Operating Implementation Programme and for National Anticorruption Fight Plan. The first e-announcement board was opened at the Municipal Court at Supetar on 27 th May, The aim of the project was to become one of controlling mechanisms for application of the anticorruption policy and the manner of decreasing of court proceeding costs. Invitations and all decisions (orders, judgements and conclusions) for parties who are absent and whose residence is unknown are published in e-announcement boards of courts. For example, in such a way the delivery of the verdict pursuant rules for the delivery of the Civil Procedure Act has become an exception and not a rule. Namely, the court has to determine the hearing for issuing of the verdict as early as during the hearing at which the main hearing is concluded (taking the prescribed term of 45 days into account) and to submit the written verdict document to the present party. The verdict saying hearing will be held independently of the fact whether parties are duly informed about it or not, i.e. regardless the

3 fact whether they are present at the hearing. The court will not deliver the verdict to the party who has been duly informed about the verdict saying hearing; it would be considered that the delivery has been performed on that day. (The court will upload the verdict to the Internet E- Announcement Board of Courts.) The party can take the verdict written document in the Court Building. The importance of the moment from which terms are counted should be pointed out here and for parties that are duly informed about the verdict saying hearing it starts to be counted on the first day following the day when the verdict is said. The court shall deliver the verdict to the party that has not been duly informed about the verdict saying hearing in accordance with provisions of the Civil Procedure Act governing the delivery of documents. That is the only exception when the verdict shall be delivered. The intention is establishment of the discipline not only for courts in the sense of terms for editing of the verdict, but also for parties to participate at the verdict saying hearing decreasing cost of the delivery. How to use the application? The application of the Ministry of Justice is used for an insight into the central announcement base of announcement boards of municipal, county and commercial courts of the Republic of Croatia. A central browser can be used to search announcements of municipal, county, commercial, civil and administrative courts of the Republic of Croatia, the Croatian Financial Agency participating in enforcement procedures and public notaries. All competent bodies announcements shall be published without delay and they will be withdrawn automatically when the announcement term expires. The Ministry of Justice as the highest body for announcement of the judicial authority provides for the technical presumptions for the described IT system. All registered data are within the competence of courts at which proceedings are lead. If someone has complaints or questions regarding published data, he/she should contact the competent court. Every person should register himself/herself to review the E-Announcement Board. Prepared by: Iskra Gudan, LLB, Končar - Electrical Industry, Inc.

4 3. Economy in the Light / Darkness of Laws (Yesterday, Today, Tomorrow) 191 st Conference of the Club of Lawyers of the Town of Zagreb, held on 22 nd January, 2015 was marked by twenty years of application of the Trading Company Act. Prof Zoran Parać PhD reviewed the Trading Company Act in the historical context of the commercial law. If we can believe in Cicero s proverb Historia est magistra vitae, we can make a conclusion that the history of the commercial contracting law in the territory of Croatia shows a uniform continuity of passing, development and application to the contrary of the Commercial Status Law. The development of the society and material sources in the Austrian Empire created conditions for passing and application of the General Citizen Legal Code (Allgemeines bürgerliches Gesetzbuch, ABGB) in At first the General Citizen Legal Code applied in Croatia directly, and later on its provisions applied as legal rules (showing the power / impotence of the ideology and the politics of the time). The General Obligation Law of 1978 was compiled in the sense of the General Citizen Legal Code. After the decision of the Croatian Parliament of 8 th October, 1991 on the termination of the legal and state federation, the General Obligation Law of 1978 applied continuously on the basis of the Law on Taking- Over the General Obligation Law of The contemporary General Obligation Law passed in 2005 is also in the spirit of the General Obligation Law of 1978 and the General Citizen Legal Code. The continuity of application of rules and regulation of the contractual law is really visible here. The history of the Commercial Status Law gives a totally different image. Before passing of the Trading Company Act trading companies in Croatia were governed by the Commercial Law of It stipulations applied up to 1948 when trading companies were terminated and when the area of state economic societies began. In 1976 the Associated Labour Act was passed introducing Associated Labour Organisations. Associated Labour Organisations were based on the public ownership and the right of workers to work with public working means, settings that were totally different from settings on which trading companies were based. The Labour Organisation Act introduced social organisations on 1 st January, 1989 that had property, but they did not have members yet. They were based on self-management. In addition to them, so called mixed ownership organisations were introduced as well. They were stock companies, limited liability companies, limited partnerships and companies with unlimited solidary liability. We can say that trading companies were introduced in Croatia again after 41 year. The Labour Organisation Act was characterised by under standardisation, it had only 51 articles and after amending it had only 42 articles. In 1991 the Law on Transition of the Socially Owned Organisations was passed transforming labour organisations into trading companies and exceptionally into limited liability companies. Since it was not Kafka s transformation, but it was a transition, issues of legal security of company members and persons who entered into business relationships with companies were opened. Therefore the Trading Company Act was passed at the end of 1993 that had 1 st January, 1995 as the date of application. The Act has been amended numerous times by the present moment. If we suppose that academician Vladimir Ibler had been engaged in the commercial status law instead of the international law, only one man could register all the listed harmonisations into the Court Register. In addition, the commercial status law was never prescribed by only one rule, but several rules and regulations have been always applicable to that area. One of more important was those prescribing termination of trading entities. We can remember the Law on

5 Enforced Settlement, Bankruptcy and Liquidation of 1989 that was not so far in the past that continued to apply in the Republic of Croatia on the basis of the Law on Taking-Over of the Law on Enforced Settlement, Bankruptcy and Liquidation of 1991 that stopped to be valid when the Bankruptcy Act of 1996 came into force. The later has been amended several times by the time being. In the meantime, in October, 2012, a completely new law came into force that we had not known during our history, and that was the Law on Financial Business Operation and Pre-Bankruptcy Settlement. On the Agenda of its 200 th session held on 17 th December, 2014, the Government of the Republic of Croatia had the Bankruptcy Act Draft and it explained that the necessity to pass the new Bankruptcy Law comes out from the necessity of more efficient solution of the insolvency issue of business entities during the times of striking economic crisis and problems emerged from its application by the time being. Further on, it stated that the insolvency was a living fact in the world of dynamic and modern economy. Approximately one half of entrepreneurs run their businesses shorter than five years, and every year approximately of them throughout the European Union faced insolvency resulting in 1.7 million of persons who lost their jobs. That meant that some 600 entrepreneurs in the European Union went out of business every day. But the number was increasing the number of insolvencies was doubled from the beginning of the crisis and that trend was continuing. The evidence indicated that entrepreneurs learnt from their own mistakes and that they were generally more successful in their second business attempt. Up to 18 % of continually successful entrepreneurs had faced a failure during their first business venture. It stated that they were introducing the institute of the pre-bankruptcy settlement into the Croatian Legal System exactly with the purpose of preventive resolving of the insolvency issue. At the 16 th session of the Croatian Parliament, the Bankruptcy Act was read for the first time and the discussion about it was concluded on 21 st January, 2015 and the conclusion accepting the Bankruptcy Act Draft was adopted on 23 rd January, 2015 and all remarks, proposals and opinions were directed to the proposer to prepare the Bankruptcy Act Final Draft. The described necessity for the new Bankruptcy Act to be passed is very serious and it seems that care has been taken this time about the semantic meaning and nomotechnical standards as well. In such a manner the new Bankruptcy Act replaced, for example, the term execution of performance with the term fulfilment of performance, the term record with the term register, the term initiation with the term opening, the term country with the term state and other. Among other things the Bankruptcy Act Draft charges the court with the pre-bankruptcy procedure, prescribes various reasons and various terms when the debtor can open the prebankruptcy, i.e. bankruptcy procedure. In such a way the initiation of the pre-bankruptcy procedure is prescribed as a possibility (and not an obligation) that can be used by the debtor only by the moment when conditions for opening of the bankruptcy are not fulfilled. It introduces the rule that the proposal for opening of a bankruptcy procedure cannot be withdrawn. Pursuant the stated draft separate satisfaction rights or similar rights entering the bankruptcy mass cease if the bankruptcy creditor has acquired them during the last 60 days prior to submission of the proposal for opening of the pre-bankruptcy procedure and stated rights will be deleted from the register on the basis of a decision of the court. The exceptions are separate satisfaction rights acquired on the basis of the promissory notes or blank bonds. Pursuant the stated draft, if the bankruptcy creditor challenges legal actions of the bankruptcy debtor, it shall deposit the court down-payment covering the foreseen for the civil procedure of the defendant in case the plaintiff fails in the suit for presentation having four hearings discussing the main matter in the value of the fee for the activity of the attorney-alaw. It is interesting that the stated draft determines that all started business operations shall complete by the reporting hearing, and bankruptcy creditors make the decision whether the business operation of the debtor is going to continue or it will be stopped at the reporting

6 hearing. The continuation of business operations is allowed no longer than a year and a half from the date of the held reporting hearing unless the bankruptcy plan is submitted to the court. The bankruptcy estate is not forgotten this time either. It was discussed a lot earlier, but few stipulations were made. It is now proposed that the bankruptcy estate becomes the subject of registering and it is to be entered into the court register. The Ministry of Finance shall define the bankruptcy estate out of official duty and allocate it a personal identification number. Further on, after opening of a bankruptcy procedure, a bankruptcy plan can be compiled deviating from legal provisions regarding negotiations and allocation of the bankruptcy estate. Transition and final provisions of the draft comprise the obligation of the Republic of Croatia to pass new regulations on criteria and manner of calculation and payment of the remuneration to the bankruptcy trustee, and the minister in charge of the administration of law shall pass nine new rule books instead of current two rule books and the Resolution on the Determination of the List of Bankruptcy Trustees. Summary: the frequency of changes in state and legal systems and provisions of the area of the commercial status law during the latest century has resulted in an impossibility of creation and development of an applicable court practice in the area of the commercial status law. It is an amazing fact that shows that the importance and the force of state systems and policies of a certain time period regardless the importance and the force of the economy in an unambiguous manner. The light at the end of the tunnel comes indeed from us, all the practitioners that have succeeded to respond to status requirements of our employers as entities of the commercial law under the defined circumstances. Instead of the conclusion: Civil codifications in their essence represent the receipted Roman Law that stopped to be valid as a positive law and we can freely remind ourselves of Caesar and say Alea iacta est and it seems it has not stopped yet. Prepared by: Gordana Štanfel, LLB, Končar Electrical Industry, Inc. 4. Twenty years of application of the Trade Company Act in Interdisciplinary Environment Supported by the University of Zagreb, the Round Table was held at the Faculty of Economy of Zagreb on 29 th January, 2015 at the occasion of twenty years of application of the Trading Company Law in the interdisciplinary environment. The organiser divided topics into three groups. Within the first topic group, Nevenka Marković, a judge of the High Commercial Court of the Republic of Croatia, talked about termination of a trading company with deleting it without winding up, Željka Bregeš, the president of the Court Register of the Commercial Court of Zagreb, talked about novelties in the Court Register with a special emphasis on the cross border mergers and amalgamations, Zoran Vukić, the president of the Croatian Bar Association, talked about the effects of the Trading Company Act on the status of attorneys-at-law and Prof PhD Hana Horak talked about not harmonised status of the merger and amalgamation law in the inner market of the European Union as an obstacle of the freedom of establishment.

7 Within the second topic group, Prof PhD Darko Tipurić talked about the position of the management in double layer and single layer corporate management model, Prof PhD Boris Tušek talked about establishment and business operation of auditing commissions, in the Republic of Croatia, Prof PhD Sanja Sever Mališ talked about the guidelines of the quality of financial report auditing, while Prof PhD Nada Bodigora Vukobrat talked about implementation of the acquis communautaire of the European Union to the Croatian legislation and practice in the area of participation of workers in the decision making process. Within the third group of topics, Doc PhD Kosijenka Dumančić talked about Societas Europea the Check experiences and Croatian possibilities, Tina Jakupak, a judge of the Commercial Court of Zagreb talked about exercising of rights of shareholders in the Republic of Croatia and in the European Union, Zvonimir Šafranko talked about the role of the legal institute of the sole trader in the Croatian law and practice and PhD Dominik Vuletić talked about first experiences with the simple limited liability company. Discussions at the Round Table pointed out possible problems in practice such as different understanding of public documents in individual European Union state members where the European Union tends towards the Unique Court Register that should be updated daily. On the basis of the selection of topics at the Round Table it can be concluded that the focus was put on the legal and economical aspect of the Trading Company Act. Prepared by: Željka Tkalčec, B.Sc.Econ., Končar Electrical Industry, Inc. 5. ICC Croatia: Financing of Trade global rules, practice and new trends A seminar with the topic Financing of the Trade global rules, practices and new trends organised by ICC Croatia was held in the Croatian Chamber of Commerce on 12 th and 13 th February, Mr Pavel Andrle from the Check Republic, a secretary of the ICC Check Bank Commission and a consultant for the international trade and financing was the lecturer. Some fifty attendants participated in the seminar. The majority was from the banking sector, but some were from chemical, food and electrical industry and from trade. Members of the Association of Corporate Lawyers were also there. The seminar was focused on actual issues of trade financing and fight against financial crime with a special review of the current events in the field of documentation letters of credit and bank guarantees, i.e. UCP 600 (Uniform Customs and Practice for Documentary Credits), ISBP 745 (International Standard Banking Practice) and URDG 758 (Uniform Rules for Demand Guarantees).

8 Lectures were useful for acquiring of expert knowledge and education on export trading operations, informing on the most recent world practices and instruments available to trading companies due to increasing of the competitiveness in the international market. Practical concrete case study exercises and tasks were especially useful. The lecturer used them, together with seminar attendants to explain numerous topics from previously stated unique rules and practices. Prepared by: Ana Zbiljski, LLB, Končar Electrical Industry, Inc. In Zagreb, February, 2015 Association of Corporate Lawyers