EU introduces Regulation for law applicable to torts 

On Sunday, the EU introduced an entirely new approach to the way in which courts within the EU will determine what law applies to non-contractual obligations (torts and similar claims). Sunday was the date on which the Rome II Regulation (Rome II) came into force.

Rome II is designed to harmonise conflicts of law, and thus facilitate mutual recognition of court judgments between EU states. It is relevant to all businesses which trade anywhere outside England, and which may face tort claims, such as product liability, personal injury or unfair competition.

Note that Rome II does not affect EU rules on jurisdiction. The question of which courts should hear a dispute is still determined by the Brussels Regulation 44/2001.

The new general rule is that the applicable law is the law of the country in which direct damage occurs, although there are exceptions where the claimant and defendant to a claim have their "habitual residence" in the same country or if the damage is "manifestly more closely connected" with another country. For example, if an English resident travelling in France is involved in a car accident, the law of France will apply to his or her personal injury claim unless the party causing the accident also has habitual residence in England.

There are rules for certain specific torts, some of which are very complex. Broadly speaking these can be summarised as the law of the country where, for claims based on:

• product liability, the product has been marketed;
• restriction of competition (cartels/monopolies), the relevant market is located;
• intellectual property, the IP protection is sought;
• industrial action, the action takes place;
• unjust enrichment, the relationship giving rise to it was based.

…and there are other detailed specific provisions, together with exemptions.

Rome II also, and importantly, introduces the novel concept of parties "agreeing" what law will apply to non-contractual obligations.

Rome II has "universal application", so can result in the application of a non EU law. It also applies to the question of quantum (how much a claim is worth), which is a radical departure from the previous English approach of leaving that question to the courts where the dispute is heard, as a matter of procedural rather than substantive law. The spectre thus arises of large foreign law claims being litigated in the English courts.

All businesses need to be aware of the possible consequences of Rome II, as it will apply to all tortious claims which have a connection with legal systems outside England and Wales. It should also be taken into account in the drafting of international contracts.

This update is not intended as a statement of law and should not be taken as such. It is for information purposes only. Its contents do not constitute legal advice and should not be regarded as a substitute for detailed advice in individual cases.

For further advice or information, please contact
Clare Dwyer on +44 (0)161 934 6534 or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

John Gatenby on +44 (0)161 934 6548 or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it