An International Netherlands Commercial Court?

Introduction

In November 2015, the Dutch Council for the Judiciary published a plan for the establishment of a Netherlands Commercial Court (hereafter: ‘NCC’), a special state court in the Netherlands for large national and international commercial disputes.[1] This commercial court with specialized judges that is supposed to conduct proceedings in the English language follows the recent establishment of international commercial courts around the world, most notably in Singapore and Dubai.[2] This paper will argue that the plan by the Council for the Judiciary is of a more conservative nature than the Singapore International Commercial Court (hereafter: SICC) and the Dubai International Financial Centre (hereafter: DIFC) Courts. The plan for the NCC seems less ambitious in its international scope, arguably showing that, unlike its counterparts in Singapore and Dubai, its primary goal is to attract domestic companies. This will be illustrated by looking at three factors: the language of proceedings in appeal and cassation (paragraph 1), the composition of the court (paragraph 2) and the court’s evidence rules (paragraph 3).

It is important to evaluate the plans for the NCC. A court that is tailored to the needs of commercial parties has the potential to reverse the current downward trend in large trade cases being brought before Dutch courts in times of increasing need for cheap and efficient solution of complex transnational trade disputes.[3] Thus, the plan for the NCC explicitly states that it aims to compete in the international dispute resolution market, in particular with the nearby Commercial Court of England and Wales in London, by offering cheaper and faster resolution of trade disputes by specialized judges in the English language.[4]

In order to implement the plan, a Netherlands Commercial Court Bill has been introduced on 16 December 2016 that relates to the amount of court fees and the use of English as a language of proceedings.[5] The limited scope of these amendments already constitutes a striking difference with the courts in Singapore and Dubai, which were established through the enactment of comprehensive legislation.[6] A closer look at the NCC’s planned structure and composition will further show that the changes brought about by the new court are relatively modest compared to the other international commercial courts.

 

  1. The language of proceedings at the Supreme Court

An appeal of an NCC judgment is possible in the English language. However, cassation at the Supreme Court will always take place in Dutch.[7] The plan for the NCC does not give an explanation for this limitation. It is not at once clear why proceedings at the Supreme Court cannot be in English. There is currently no explicit legal basis for Dutch as the official language of proceedings.[8] In comparison, a pending legislative proposal for international commercial court chambers in Germany does provide for the possibility of conducting proceedings in English before the German Supreme Court, the Bundesgerichtshof (Article 184(3) Gerichtsverfassungsgesetzes).[9] The absence of such an initiative in the Netherlands once again shows the limited international focus of the NCC compared to similar commercial courts in other states.

 

  1. Composition of the court: no foreign judges and no additional domestic judges envisaged

In terms of the composition of the court, the NCC again seems less revolutionary than the courts in Singapore and Dubai. The NCC will take the form of a special chamber of the Amsterdam District Court and the Court of Appeals in Amsterdam and will consist of judges who are appointed based on their specialized knowledge, experience and English language proficiency.[10] These judges will come from other courts in the country. Since the Plan does not offer the possibility of hiring new or foreign judges, it seems that there will be no foreign judges appointed to the NCC.

By comparison, the SICC and the DIFC Courts are comprised of a unique mix of local judges and foreign judges from major jurisdictions around the world.[11] Such a mix is intended to improve the court’s ability to resolve disputes governed by laws from foreign jurisdictions and to enhance its international reputation in terms of neutrality and impartiality when it handles cases that do not involve parties from Singapore.[12] Chief Justice of Singapore Sundaresh Menon expressed a vision for the SICC as a court that is ‘blind to the nationality or domicile of a litigant’.[13]

The lack of foreign judges shows that these goals are not pursued in the same fashion by the NCC. The Dutch Court seems to put more emphasis on the internal specialization of national judges, rather than relying on the expertise of international professionals. This choice is consistent with the above-mentioned considerations concerning the purely domestic nature of the evidentiary rules on which the parties can rely.

The minimal changes envisaged by the plan with regard to the composition of the Court are unfortunate, since the NCC obviously aims to attract more commercial parties than Dutch courts currently do, whilst judges in the Netherlands are already deemed to be under great pressure due to excessive workload.[14]

 

  1. Absence of international standards of evidence

Another indication of the modest nature of the NCC’s international ambition compared to that of the other international commercial courts relates to the court’s evidence rules. The plan for the NCC does not offer flexibility as to the type of evidence rules to be applied, since it does not state explicitly that parties can choose what kind of evidence rules they would like to be applicable. Consequently, the NCC seems to rely exclusively on existing evidence rules in Dutch civil procedure law.[15] In contrast, the SICC is empowered to apply rules of evidence other than the ones under Singaporean law, such as the IBA Rules on the Taking of Evidence in International Arbitration (Article 18K(1) Supreme Court of Judicature Act). The absence of such freedom of choice, which in the case of the Singaporean court was welcomed as innovative and reflective of a strong international ambition, suggests that the NCC’s aspiration in this respect is more limited.[16]

It could be argued that there is no urgent need for the NCC to offer such alternative international standards, because Dutch procedural law generally is considered efficient, expeditious and predictable.[17] Nonetheless, this only reinforces the argument that the efficiency of the procedure is considered more important than its international dimension.

 

Conclusion

Where the SICC has been praised as a ‘visionary step’ and a judicial forum with unrivaled international legal sophistication, it is hard to say the exact same of the NCC as currently envisaged in the plan.[18] The NCC’s overall idea and structure can be considered a welcome institutional innovation and its specialized judges and the English language of proceedings will likely prove attractive to commercial parties.[19] However, a comparison with other international commercial courts reveals that the NCC’s set-up is not as revolutionary as its counterparts in Singapore and Dubai in terms of international ambition and focus.

As opposed to the SICC, the NCC does not offer the option to use alternative international evidence rules as an alternative for Dutch procedural rules. Furthermore, the composition of the court, lacking foreign judges, stands in contrast with the mix of domestic and international judges at the courts in Dubai and Singapore. Similarly, the imposition of Dutch as the only language of proceedings at cassation level confirms the limited international vocation of the NCC.

This inward-looking dimension is somehow acknowledged by the plan itself, which mentions the interests of Dutch companies in saving costs by avoiding recourse to Anglo-American courts for specialized commercial procedures as one of the rationales for the court.[20] Therefore, the goal of the NCC appears to be different from that of the SICC and the other international commercial courts. It would seem that the focus of the plan for the NCC is more about providing Dutch and foreign companies operating in the Netherlands with effective and familiar procedural remedies than about the establishment of a truly international commercial court. This choice is perhaps hard to justify, given the absence of any stated reason for this restraint in the attempt to internationalize the rule of law for the benefit of the international community.[21] It is to be hoped that the NCC will gradually develop its international focus in the future.

 

Annette Scholten, LL.B. Leiden University; LL.M. Candidate, New York University (2017).

[1] Dutch Council for the Judiciary, Plan tot oprichting van de Netherlands Commercial Court inclusief kosten-batenanalyse (Plan for the establishment of the Netherlands Commercial Court including cost-benefit analysis), November 2015, http://www.netherlandscommercialcourt.nl and http://netherlands-commercial-court.com. The court was originally scheduled to start functioning from 1 January 2017, but this deadline has not been met due to delays in the passing of the necessary legislation. Although no official revised opening date of the court has yet been stated, the Netherlands Commercial Court Act is planned to come into force on 1 January 2018. See http://netherlands-commercial-court.com.

[2] Dutch Council for the Judiciary, supra note 1, p. 8-10, 12, D.H. Wong, The rise of the international commercial court: what is it and will it work?, 33(2) Civil Justice Quarterly 205 (2014), p. 206-207, E. Bauw, Ondernemerschap in de Rechtspleging (Entrepreneurship in Legal Procedures), Ars Aequi 93 (February 2016), p. 93, D.P. Horigan, From Abu Dhabi to Singapore: The Rise of International Commercial Courts, 3(2) International Journal of Humanities and Management Sciences 78 (2015), p. 78.

In Germany, there is currently a legislative proposal pending that would also make it possible to establish international commercial courts: Gesetzentwurf des Bundesrates, Entwurf eines Gesetzes zur Einführung von Kammern für internationale Handelssachen (Draft law on the introduction of chambers of international trade), 30 April 2014.

[3] Dutch Council for the Judiciary, supra note 1, p. 2, 4-6, 9, S. Menon, The Transnational Protection of Private Rights: Issues, Challenges and Possible Solutions, 108 American Society of International Law Proceedings 219 (2014), p. 224, C. Sikkel, P.A.M. van Schouwenburg-Laan, Actualiteiten maritieme kamer Rechtbank Rotterdam (News maritime chamber Rotterdam Court), 1 Tijdschrift Vervoer & Recht 20 (2016), p. 22, Bauw, supra note 2, p. 96.

[4] Dutch Council for the Judiciary, supra note 1, p. 2. G.A. van der Steur, Kamerbrief NCC (Letter of Minister of Justice to Parliament), 23 November 2015, p. 2, S. Menon, International Arbitration: The Coming of a New Age for Asia (and Elsewhere), Keynote Address Opening Plenary Session ICCA Congress 2012, p. 13-14, E. Lein et alia, Factors Influencing International Litigants’ Decisions to Bring Commercial Claims to the London Based Courts, Ministry of Justice Analytical Series 2015, p. 16, C. Jeloschek, ‘Netherlands Commercial Court’: eindelijk een alternatief voor grote (inter)nationale handelsgeschillen vanaf 1 january 2017 (‘Netherlands Commercial Court: finally an alternative for large (inter)national trade disputes from 1 January 2017), 34(11) Bedrijfsjuridische berichten 129 (2016), p. 130-131.

A similar initiative is already taking place in Rotterdam, where a pilot started in January 2016 in the Rotterdam District Court enabling proceedings in maritime, transport and international trade sale cases to be conducted in English. See https://www.rechtspraak.nl/Organisatie-en-contact/Organisatie/Rechtbanken/Rechtbank-Rotterdam/Nieuws/Paginas/Pilot-project;-civil-court-procedures-in-English.aspx, Sikkel, van Schouwenburg-Laan, supra note 3, p. 20, C.J.M. Klaassen, Producties in een vreemde taal (Documents in a foreign language), Ars Aequi 843 (November 2016), p. 847, R.J. Tjittes, Een Netherlands Commercial Court vereist reclame voor Nederlands recht (A Netherlands Commercial Court asks for advertisement of Dutch law), 6 THEMIS 261 (2014), p. 261.

[5] Wet houdende wijziging van het Wetboek van Burgerlijke Rechtsvordering en de Wet griffierechten burgerlijke zaken in verband met het mogelijk maken van Engelstalige rechtspraak bij de internationale handelskamers van de rechtbank en het gerechtshof Amsterdam (Act concerning the modification of the Code of Civil Procedure and of the Act on Fees for Civil Proceedings in order to make proceedings in the English language possible in the Netherlands Commercial Court chamber of the Amsterdam District Court and the Court of Appeals in Amsterdam), consultation version, December 2016. See also Van der Steur, supra note 4, p. 2.

[6] SICC: Articles 18A – 18M Supreme Court of Judicature Act. DIFC Courts: Dubai Law establishing the Judicial Authority at the Dubai International Financial Centre No. 12 of 2004, the DIFC Court Law No. 10 of 2004.

[7] Dutch Council for the Judiciary, supra note 1, p. 10.

[8] T. Veling, Vreemde talen in de civiele procedure (Foreign languages in the civil procedure), 5 Tijdschrift voor de Procespraktijk 109 (2016), p. 109.

[9] See footnote 2 for more information about the German legislative proposal.

[10] http://www.netherlandscommercialcourt.nl/news/ncc/, Veling, supra note 8, p. 111, Dutch Council for the Judiciary, supra note 1, p. 10.

[11] Article 5A Supreme Court of Judicature Act Singapore, A. Emmerson, S. Jhangiani, J. Lewis, Why international courts may be the way forward, Global Arbitration Review News (16 February 2015), R. Hermans, A Netherlands Commercial Court, Ars Aequi 187 (May 2015), p. 195, Wong, supra note 2, p. 208, W.Y. Kenny, Exploring a New Frontier in Singapore’s Private International Law, 28 Singapore Academy of Law Journal 649 (2016), p. 650.

[12] S. Leong, Planting the Seeds for an International Rule of Law – The Commercial Court of England and Wales and the SICC, Practical Law UK (12 May 2015), p. 10, S. Menon, International Commercial Courts: Towards a Transnational System of Dispute Resolution, Opening Lecture for the DIFC Courts Lecture Series 2015, p. 24-25. See for example the International Judges of the SICC, a group of reputable judges from both common and civil law backgrounds: http://www.sicc.gov.sg/Judges.aspx?id=30.

[13] Menon, supra note 12, p. 42.

[14] J.C. Oord, Geschillenbeslechting als business model (Dispute resolution as business model), 5 Tijdschrift Ondernemingsrechtpraktijk 370 (2016). Concerning the complaints about high workload for Dutch judges, see for example http://www.mr-online.nl/juridisch-nieuws/23356-hoge-werkdruk-rechterlijke-macht-bewezen, http://www.volkskrant.nl/binnenland/president-hoge-raad-bezorgd-om-werkdruk-rechters~a3388115/.

[15] E. van de Kuilen, Netherlands Commercial Court to launch next year, AKD 16 February 2016, https://www.akd.nl/o/Paginas/PublicatiesEN/Netherlands-Commercial-Court-to-launch-next-year.aspx.

[16] Kenny, supra note 11, p. 650. For example, the Commercial Court of England and Wales in London does not offer such a choice of evidence rules: HM Courts & Tribunals Service, The Admiralty and Commercial Courts Guide 2014, p. 57ff.

[17] Dutch Council for the Judiciary, supra note 1, p. 9, Hermans, supra note 11, p. 193, Lein et alia, supra note 4, p. 27, Leong, supra note 12, p. 7-8.

[18] S.J. Brogan, Singapore’s Leadership in Advancing the Rule of Law, The Straits Times 19 January 2016.

[19] Horigan, supra note 2, p. 80, C.A. Kern, English as a Court Language in Continental Courts, 5(3) Erasmus Law Review 187 (2012), p. 190-191.

[20] Dutch Council for the Judiciary, supra note 1, p. 6.

[21] Leong, supra note 12, p. 12.

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