Exclusive jurisdiction in European insolvency law

On 14 November 2018, the Court of Justice of the European Union issued a judgment on jurisdiction for avoidance actions under the previous Insolvency Regulation.

In its decision of 12 February 2009, the Court had already established that the courts of the Member State with jurisdiction to open insolvency proceedings are competent for all the actions directly related to the insolvency.

Now the Court has held that the courts of the Member State within the territory of which insolvency proceedings have been opened enjoy exclusive jurisdiction to hear actions which derive directly from those proceedings and are closely connected with them. This includes actions to set a transaction aside based on insolvency.

As before, the Court has stressed the necessity to concentrate the international jurisdiction in order to improve the effectiveness and efficiency of cross-border insolvency proceedings. Furthermore it underlines the importance of avoiding forum shopping.

The decision is not only in line with previous case law but also with article 6(1) and article 6(2) of recast Regulation (EU) 2015/848.

Court of Justice of the European Union, 14 November 2018, Case C-296/17, Wiemer & Trachte GmbH (in liquidation) v Zhan Oved Thadzer