Argentina recently enacted a new Civil and Commercial Code to replace the previous civil and commercial acts – approved over a century ago – which were historically regulated in separate codes. With this long-awaited initiative, Argentina has followed the modern trend adopted in many other countries of merging the existing civil and commercial codes and unifying private law in a new single, updated and systematic corpus.
The new code will come into force from August 2015 and contains significant new federal regulations on Argentine private international law in Sections 2594 to 2612 of Book VI, Title IV. The new code introduces a specific chapter on international jurisdiction that will alter the framework which governs international litigation in Argentina.
However controversial the process of drafting and final approval of the new code may have been, there was general consensus that it was imperative to modernise and reorganise the rules of conflict in Argentina.
In this context the new regulation sought to articulate local legislation on private international law effectively in line with the systems of other states, taking the phenomenon of globalisation as a determining factor of contemporary legal relations.
Key provisions on international jurisdiction
The new code legislates key aspects of international jurisdiction. Among other principles, the new code includes:
- party autonomy to choose and extend jurisdiction;
- the forum of necessity;
- the power to issue provisional measures and injunctions;
- individualisation of certain exclusive jurisdictions;
- international lis pendens – also termed international parallel litigation or duplicative foreign litigation; and
- international cooperation and procedural assistance.
Provisional measures and injunctions
Under Section 2603, the new code empowers Argentine judges to issue provisional measures and injunctions in the following scenarios:
- when they are competent in the main proceedings, whether the assets or persons are in Argentina or not;
- at the request of a foreign judge with jurisdiction in the case or in urgent cases, when the assets or persons are or may be in Argentina; and
- when the foreign judgment should be recognised or enforced in Argentina.
The new code clearly states that compliance with an injunction issued by a foreign judge shall not entail any commitment by Argentina to recognise or enforce the substantial foreign judgment on the merits of the dispute issued in the main proceedings.
International lis pendens
Section 2604 of the new code incorporates the concept of international lis pendens into Argentine private international law.
The law covers a situation in which there are two pending judicial proceedings between the same parties with the same object and cause of action, one initiated in Argentina and another previously initiated in a different state.
In principle, there is no common superior authority to both states and in the absence of a treaty, each court will determine its jurisdiction in accordance with conflict of laws rules that may be dissimilar.
In these circumstances, the new code provides that the Argentine judge shall suspend the local proceedings if it is foreseeable that the judgment to be issued in the foreign previously initiated law suit might be recognised in Argentina.
The process in Argentina can be resumed if:
- the foreign judge declines jurisdiction to intervene in the case;
- the foreign process terminates without a decision on the merits of the dispute; or
- the foreign judgment cannot be recognised in Argentina.
International cooperation and procedural assistance
The new code also contains general principles that relate to the interaction between Argentine and foreign judges in the context of judicial proceedings. In this regard, Section 2611 establishes the duty of the Argentine judges for jurisdictional cooperation with foreign judges.
In the same vein, Section 2612 establishes that communications between the Argentine and foreign authorities shall be made by letters rogatory to contribute to the expeditiousness of proceedings. It also provides that Argentine judges will comply with procedural and evidentiary measures ordered by foreign judges. However, it further establishes that such measures shall not affect the public order of Argentine law. In both cases, the collaboration of Argentine judges is an independent principle that shall not be affected by the lack of a treaty or the lack of reciprocity with the requesting state.
Prior to the introduction of the new code, Argentine private international law lacked federal laws containing general principles and specific rules on international jurisdiction combined in a single and systematic act. Conversely, Argentina had dispersed rules on international jurisdiction and certain provisions contained in international treaties to which the country is party.
Consequently, beyond the pros and cons of the amendments introduced by the new code, Argentina has legislated on this matter in the same way as many other countries. Further, the incorporation of rules on international cooperation and procedural assistance between Argentine and foreign courts should help to obtain solutions in multinational cases with greater speed and effectiveness. Nevertheless, while civil, commercial and criminal legislation in Argentina is enacted by federal authorities, the power to enact procedural rules still remains with each province.
Therefore, some legal authors have raised the issue that the constitutionality of some international procedural issues included in the new substantive code – technically reserved for regulation by the provinces – may be a matter for debate. This will be examined by local doctrine and case law. Indeed, the new code should be tested in practice in order to confirm that it offers practical solutions to the abovementioned issues.
The new Civil and Commercial Code deliberately excludes provisions on the rules of recognition and enforcement of foreign judgments. Regulation on this matter – a key aspect of international litigation – can be found only in the country's civil procedure codes enacted in the federal (National Civil and Commercial Procedural Code) and provincial jurisdictions.
For further information on this topic please contact Ricardo Ostrower at Marval O'Farrell & Mairal by telephone (+54 11 4310 0100) or email (email@example.com). The Marval O'Farrell & Mairal website can be accessed at www.marval.com.ar.
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