Ecovis Germany

Arbitration or Litigation? Choosing the Right Forum for Cross-border Disputes

Participants and parties to cross-border disputes, that is disputes of an international nature involving entities located within different jurisdictions, must choose the forum within which disputes are to take place. The choice of forum for resolving international disputes is either litigation or arbitration.

In simple terms, litigation means referring a dispute to a court process in order to resolve the matter. Arbitration is an alternative to court proceedings and is a contractually agreed method of resolving disputes.

In terms of choice, there are various applicable determining factors. Parties may find themselves contractually bound to arbitrate because of a dispute resolution clause in the contract entered into between the parties, explain the experts from Barlow Robbins LLP.

If a choice is available, litigation may be favoured due to the openness and associated tactical pressure of knowing that there is scope for the public reporting of the proceedings, unlike arbitration which tends to remain a confidential process. Alternatively, parties may opt to arbitrate because it offers greater flexibility in terms of process and procedure.

Parties can choose the rules governing the conduct of the arbitration by selecting an arbitral institution and are able to select the composition of the tribunal. The most common institutions are the International Chamber of Commerce (ICC) and the London Court of International Arbitration (LCIA), although there are many institutions across the world offering similar services. The parties also choose (if it is not already pre-determined under a contract) which country’s laws should apply to the process. The arbitration agreement will confirm much of this detail and should set out who the arbitrators will be, how many of them will sit and how they will be appointed.

The relatively straightforward process of enforcing arbitral awards in other countries also makes it a popular choice in the context of international cross-border disputes. The awards are enforceable by virtue of international conventions – the most important being the New York Convention, which is recognised by 161 nation parties. This Convention requires courts of contracting states to give effect to private agreements to arbitrate and to recognise and enforce arbitration awards made in other contracting states. In contrast, the process of recognising and enforcing judgments obtained at the end of litigation can be lengthy and costly and the prospects of successful enforcement can be uncertain in some jurisdictions.

As the UK prepares to leave the European Union by 31 January 2020, businesses involved in cross-border transactions should remain aware of their existing contractual obligations in relation to the choice of dispute resolution forum. Even at the early stage of commercial negotiations, businesses should think carefully about how they want to resolve any future dispute relating to the commercial engagement.

For further information please contact:

Daniel Baker, Associate – Dispute Resolution; Barlow Robbins LLP, Guildford, Surrey UK
Email: danielbaker@barlowrobbins.com

Barlow Robbins LLP is a law firm headquartered in Guildford, with offices in Woking and London. It is a member of ECOVIS International.

Ecovis is now represented in Georgia

We welcome our new partners from ECOVIS ATA and ECOVIS ATA Finance headquartered in Tbilisi.

ECOVIS ATA was founded by its partners Irakli Siradze and Giorgi Kverkhelidze in January 2013. Irakli held various high positions in the public sector such as Deputy Minister of Finance and Deputy Head of Revenue Service under the Ministry of Finance. Giorgi used to be Head of Tax and Customs Policy Department at Ministry of Finance and also served as the head of The Tax Division at the BDO Georgia. Vazha Petriashvili joined the company in 2015. He also held various high positions in the public sector. He used to be the head of the State Treasury, chairman at the Tax Department of the Ministry of Finance of Georgia, Deputy Minister of Finance of Georgia, Chief Advisor to the Prime Minister of Georgia, atc. Ivane Kutibashvili has recently joined the firm after many years of work with BDO Georgia where he was a partner in the department of assurance services. ECOVIS ATA represents one of Georgia’s leading multidisciplinary auditing, tax, accounting and advisory firms. The firm has a total staff of 73 including four partners.

We warmly welcome our new colleagues from Georgia to the Ecovis family!

How the Czech Republic Controls and Punishes Non-Compliance with European Data Protection Regulations

The Czech Data Protection Authority, which monitors compliance with European data protection regulations in the Czech Republic, publishes information online about its control activities, its decisions and their effects on companies.

Given the wide-ranging doubt and lack of clarity surrounding the application of the General Data Protection Regulation (GDPR) and the new Czech Personal Data Processing Act (English translation), the Czech Office for Personal Data Protection (Czech DPA, ÚOOÚ) has started to considerably increase general public awareness of its decision-making processes and its control activities. In addition to a description of all inspections carried out in the first half of 2019, a new list of selected second instance decisions made by the Chairman of the UOOU can now be found on the UOOU website.

The new Czech Personal Data Processing Act has no privision for imposing penalties on state bodies. This meant that in 2019, it was impossible to sanction the Czech Ministry of the Interior, which allowed unauthorised access to the population register a total of 7,064 times, as well as access to the population register to a greater extent than stipulated by the Basic Registers Act on 88,491 occcasions.

Since the GDPR law was passed, the Czech DPA has only imposed symbolic penalties for violating GDPR rules. As the Ecovis experts explain, a total of only 10 fines were imposed and the total amount of the fines was less than EUR 15,000.

Four examples of checks by the Czech DPA in 2019

1. The subject of the inspection by the Czech DPA was a check based on a complaint made to the Dutch supervisory authority concerning the processing of personal data of users of both the free and paid versions of an antivirus software. As part of this inspection, the Czech DPA concluded that the subject is in the position of being the antivirus software user’s personal data administrator because it has information which could eventually lead to the identification of a specific user. Therefore, by providing the antivirus software service, user data is collected which is personal data in the sense of the GDPR.
2. The Czech DPA also confirmed, that controlling access to business premises through a camera system located at the entrance is in compliance with the GDPR and the Czech Personal Data Processing Act. The Czech DPA concluded that the identification of persons entering the business premises using a CCTV (Closed Circuit Television) system in online mode without sound (without a recording system) does not amount to the processing of personal data and thus the operator of such a system is not an administrator of the personal data in the sense of the GDPR.
3. The Czech DPA also stressed the obligation to respond to a request for the withdrawal of consent for the processing of personal data and the obligation to deal with such a request immediately. A major online retailer did not process a request to delete personal information (a copy of the personal identification card and a photograph) that was processed with consent which the customer subsequently revoked. Although alledgedly the misconduct of an employee of the retailer, the Czech DPA stated that it must be as easy to withdraw the consent as it was to grant such consent and imposed a fine of CZK 15,000 (around EUR 600).
4. The Czech DPA also carried out a check on the fulfilment of obligations in the processing of the personal data of former employees, focusing on the transfer and use of electronic communication. Based on a complaint from a former employee, the Czech DPA evaluated an employer’s procedure which, following the termination of employment, does not delete the employee’s email address and mailbox which the employer continues to access. This was alledged to be a violation of the former employee’s privacy. The Czech DPA did not judge this procedure to be defective, especially with regard to the fact that the employer had implemented internal regulations covering the use of the email address and the mailbox, as well as security measures related to the integrity of the email server and of the individual mailboxes. Any potential incidents were also investigated and documented. In the event of the termination of employment, the email address is kept for three months, the former employee’s access is revoked and an automatic reply is set up to the sender of the message containing details of the cancellation of the account and new contact information.