OLG Frankfurt: Injunction declarations of foreign debtors must contain jurisdiction agreement and choice of law clause
Your contact person
The Berlin Court of Appeal (KG, Urteil v. 25.04.2014, Az. 5 U 178/11) already ruled in 2014 that foreign companies operating on the German market must accept a German court agreement in the cease-and-desist declaration in the event of legal infringements.
A recent decision by the Higher Regional Court of Frankfurt has reaffirmed this principle (OLG Frankfurt, Beschluss v. 11.3.2021, Az. 11 W 13/21) and added the necessity of a choice of law clause.
Cease-and-desist declaration must put the creditor in the same position as if he had a title
If the debtor wants the creditor to refrain from enforcing the claim in court, he must be prepared to grant the creditor a legal position – usually by submitting a cease-and-desist declaration – that is not too inferior to that of a title creditor in the event of an infringement. If this willingness is lacking, there are generally justified doubts as to the seriousness of the declaration made.
In the present case, a Swiss company had used photographs without authorization and, despite being requested to do so, refused to add a declaration to the cease-and-desist declaration issued in accordance with the new Hamburg custom that it agreed to the application of German law and a German place of jurisdiction, preferably the Regional Court of Cologne.
Cease-and-desist declaration according to Hamburg custom without jurisdiction agreement and choice of law clause is not sufficient
In the present case, this was not sufficient to eliminate the risk of repetition, ruled the Higher Regional Court of Frankfurt (OLG Frankfurt, Beschluss v. 11.3.2021, Az. 11 W 13/21). In view of the defendant’s registered office in Switzerland, the competent court for an action for a contractual penalty could not be determined beyond doubt from the outset. If the place of jurisdiction for the contractual penalty claim is not based on the defendant’s registered office in Switzerland but that of the plaintiff, the jurisdiction agreement is only of declaratory significance.
Mf the contractual penalty proceedings had to be conducted before a Swiss court without such an agreement, the plaintiff would also have a significant legitimate interest in an agreement on the place of jurisdiction. This is because this place of jurisdiction would be associated with a considerable additional burden for him, as he would have to conduct the proceedings before a foreign court with procedural rules with which he is not familiar. Even if it could be assumed that German law would apply, there would still be uncertainty as to how Swiss courts would apply German law.
Practical tip for creditors and debtors
Strict requirements are placed on the elimination of the risk of repetition by submitting a declaration of submission. If there are even minor doubts about the content and scope of the declaration of submission, it is not sufficient to dispel the concern of a future infringement of competition law. The creditor can or must then enforce his claim in court in order to protect his rights.
In disputes with an international dimension, the creditor must ensure that he is not satisfied with an obligation to cease and desist with a contractual penalty, which he may later have to enforce abroad and by applying foreign law. The guideline here is the title that would be issued at the end of a legal dispute.
It is important for the debtor to know that he does not have to offer the described additions on his own initiative. As a rule, they only have to act when the creditor asks them to do so. Against the background of freedom of contract, the parties to a forbearance agreement are free to formulate it as they wish. If the creditor is satisfied with a certain cease-and-desist declaration, it is not the debtor’s responsibility to “help him get on the horse”.
(Disclosure: LHR represented the applicant)
Related posts
Multiple awards.
