Lee A. Bygrave (red.) YULEX 2002 - Universitetet i Oslo

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Contractual Disputes regarding Virtual Enterprises 25
factors which show that the contract is closely connected to a specific country.
It is submitted that one should look at the particular circumstances of the
case, how the VE is set up and where it appears to the customer to be operating
from. For example, if the contractual negotiations for the VE were carried
out by one particular VE member who also runs and takes care of the operation
of that particular VE project (such member is usually referred to as the
VE broker), perhaps the contract has the closest connection to the country
where the VE broker’s business is situated.
In the above example, the judge may also decide to sever the contract and
deem the maintenance and upgrading of the website to be an independent
and separable part of the whole agreement. Article 4(1) of the Rome Convention
provides that “a separable part of the contract which has a closer connection
with another country may by way of exception be governed by the
law of that other country”. The Giuliano-Lagarde Report on the Convention
[1980] held that severance should be allowed “by way of exception, for a
part of the contract which is independent and separable, in terms of the contract
and not of the dispute, where that part has a closer connection with
another country”. It gives the example of contracts for joint ventures and
complex contracts. The above could be said to be such a complex contract.
5.2 Choice of Law, B2C Contracts and Mandatory Rules
Special rules apply to contracts with consumers also as regards the choice of
law. A consumer is defined in the Rome Convention (and also in the Brussels
& Lugano Conventions and the Jurisdiction Regulation) as a person who
enters into a contract outside his trade or profession. Of particular note for
VE networks are the first two indents of Article 5(2) which provide that even
where an express choice of law was made in the consumer contract, this is
not allowed to have the result of depriving the consumer of the protection
afforded to him by the mandatory rules of the country in which he has his
habitual residence:
• if in that country the conclusion of the contract was preceded by a
specific invitation addressed to him or by advertising, and he had
taken in that country all the steps necessary on his part for the conclusion
of the contract, or
• if the other party or his agent received the consumer’s order in that
country.
Mandatory rules are defined in Article 3(3) as rules “which cannot be derogated
from by contract”. In order to determine whether rules of a particular
country are mandatory, reference must be made to the law of that country