The Unification of Private Law in Times of COVID-19

Abstract

This article tests the role of three UNIDROIT instruments in reducing the uncertainty caused by the COVID-19 pandemic. First, we cover force majeure and hardship under the Principles of International Commercial Contracts. Then, we turn to the harmonisation of substantial civil procedure. Lastly, we analyse the International Convention on Travel Contracts.

1. The global pandemic and the unification of private law

Pandemics have always been an episodic feature of human existence.1 However, what differentiates how we address them in modern times is the use of the law rather than its suspension. From the work of Thucydides, who recounts the plague of Athens (430 B.C.),2 to Boccaccio’s documentation of the Black Death (1342-1353 A.D.),3 what emerges as a fil rouge is civil disintegration and the loss of social order.4 On the contrary, the response to the COVID-19 pandemic has been characterised by an extensive usage of the tools provided by the law.5

With specific regard to private law, it is clear that its patrimonial function has made it a protagonist in maintaining the certainty of social relations and in coping with the consequences of the measures taken by local governments. After all, the nature of private law is precisely that of regulating relations between individuals. To put it in a Latin brocard: “Publicum ius est quod ad statum rei Romanae spectat, privatum quod ad singulorum utilitatem” (“Public law consists of laws that affect the general interests of the state, private law is what concerns the utility of individuals”).6

One of the first concerns of local emergency laws was the recognition of the pandemic as a justification for exempting debtors from liability in the fulfilment of contracts. For example, the French Ministry for the Economy and Finance stated that the COVID-19 pandemic was to be considered a force majeure event.7 In May 2020, the British government urged contractual parties to act fairly and responsibly in performing and enforcing contracts that were materially impacted by the COVID-19 pandemic.8 The Italian government, with the Decreto Cura Italia, established that the COVID-19 pandemic-related containment measures were always to be taken into consideration when deciding whether to exempt the debtor from contractual liability.9

However, in a hyperconnected world, local events inevitably spread beyond national borders.10 The restrictions imposed by the governments of many countries resulted in the suspension of several economic activities.11 The domino effect of delayed payments and the suspension of the honourability of contracts and insolvencies risked an exponential increase of damages that were no longer limited to a single geographic area or to a single stage of the supply chain.12

Thus, for the reasons just outlined, while private law is important to tackle the effects of the pandemic, local emergency laws are not sufficient. Therefore, one organisation becomes of particular relevance: the UNIDROIT (International Institute for the Unification of Private Law) lays the foundation for a global private law, always taking into consideration and respecting different legal traditions.13 On the one hand, the rebirth of the lex mercatoria14 allows economic operators to rely on a set of rules designed and refined to meet the needs emerging from international contractual relations while simultaneously reducing transaction costs.15 On the other hand, the operational scope of the UNIDROIT is connected to a holistic definition of private law, including, among others, cultural property, intellectual property, agriculture and transportation.16

This article aims to analyse the impact of UNIDROIT instruments in addressing the current pandemic (or rather the economic consequences of government responses to COVID-19) in regard to three specific topics: (i) force majeure and hardship, where we will demonstrate the need for a common and flexible rule given the differences between various legal systems, (ii) national litigation and cross-border insolvencies, where we will argue that in order to guarantee the cross-border filing of claims in insolvency proceedings and the transnational enforcement of judgements, harmonised procedural rules and substantial insolvency law harmonisations are needed, and (iii) travel contracts and their cancellation, where we will recall the International Convention on Travel Contracts, signed 50 years ago, showing how its norms would be applicable to the current situation.

2. UNIDROIT Principles of International Commercial Contracts 2016 (“U.P.I.C.C.”): force majeure and hardship

The global outbreak of a viral disease is not a new phenomenon. This time, however, various government responses have been unprecedented in their scope. Contracts are certainly law between the contracting parties, but the regularity of economic life and the calculability required by commercial exchanges have been shaken by the introduction of new factors within the equation (such as business and transport limitations). There are two doctrines that are helpful to solve legal disputes: the force majeure doctrine (article 7.1.7 U.P.I.C.C.), which is used to excuse the non-performing party from liability for damages, and the hardship doctrine (article 6.2.2), which is useful for renegotiating the terms of the contract, so as to allow the contract to be kept alive although on revised terms.

Specifically, according to article 7.1.7 of the U.P.I.C.C. (2016), force majeure can be invoked by the non-performing party to avoid liability when “the non-performance is due to an impediment beyond its control and that it could not reasonably be expected to have taken the impediment into account at the time of the conclusion of the contract or to have avoided or overcome it or its consequences”. It seems reasonable to assume that in the future, the possibility of a pandemic scenario will be more often incorporated in a contract’s clauses, given the previous experience. It is worth noticing that a necessary element for the application of the force majeure under U.P.I.C.C. is that the event must be unforeseeable and unavoidable or insurmountable.17 In the immediate future, lockdowns and restrictions will hardly be considered force majeure. As for hardship under U.P.I.C.C., article 6.2.2 states that it occurs in case of an event that “fundamentally alters the equilibrium of the contract either because the cost of a party’s performance has increased or because the value of the performance a party receives has diminished, and (a) the events occur or become known to the disadvantaged party after the conclusion of the contract; (b) the events could not reasonably have been taken into account by the disadvantaged party at the time of the conclusion of the contract; (c) the events are beyond the control of the disadvantaged party; and (d) the risk of the events was not assumed by the disadvantaged party”.

These two legal doctrines, as regulated in U.P.I.C.C., do not find their perfect match in national legal systems. In English law, there is no such thing as a hardship doctrine. The doctrine of “frustration and impossibility of performance” asserts that a contract is “frustrated” only if its performance has become impossible, illegal, or would result in an outcome radically different than the one intended by both parties at the time of the contract.18

In Germany, the doctrine of Störung der Geschäftsgrundlage (hardship) was codified in §313 of the German Civil Code (BGB) by Schuldrechtsmodernisierung of 2002.19 This article requires a fundamental change in the circumstances upon which a contract was based and that the parties would not have concluded it, or would have concluded it differently, if those changes could have been foreseen. While there is no reference to force majeure in the BGB, the legal concept of “impossibility of performance” is used in similar cases.20 If an adjustment of the contract is not possible, or not reasonable for a party, the disadvantaged party can withdraw from the contract. Instead of the right to withdraw from the contract, the right to terminate the contract applies for continuing obligations.

In French law, hardship was recently regulated by article 1195 of the Civil Code, finally overturning the théorie de l’imprévision21 asserted in the Cour de cassation’s decision in Canal de Craponne of 1867.22 According to this article, where a change of circumstances, unforeseeable at the time of the conclusion of the contract, makes the performance excessively onerous for a party that had not accepted to assume the risk, that party may ask for a renegotiation of the contract. In the case of refusal or failure to renegotiate, the parties may agree to terminate the contract, at the date and on such conditions as they shall determine, or by mutual agreement ask the judge to adapt it. In the absence of an agreement within a reasonable time, the judge may, on one party’s request, amend the contract or terminate it, at the date and on such conditions as he or she shall determine.23 It should be noted that this new rule only applies to contracts concluded after 1st October 2016.

Thus, different jurisdictions provide different rules to regulate the termination of contracts in the case of a disruptive event such as the pandemic. Conversely, U.P.I.C.C. represent a general rule for parties that goes beyond their municipal laws and that sets a common ground.24

As much as legal traditions differ in various countries, there are some common roots which are represented by ancient Roman Law. The articles on force majeure and hardship are connected to the change in circumstances after the conclusion of a contract, and they aim at providing a single balance between two contrasting fundamental legal principles that trace back to the Roman and medieval tradition: the principle of pacta sunt servanda and the principle of clausula rebus sic stantibus.25 According to the first principle, contracts are to be considered as a stable regulation of the relation between the parties. The second principle obliges parties to read the contract in the light of good faith; the contract is binding, but its continued enforceability and performance is subject to the perduring existence of those circumstances which were present at the time of contracting.26 Therefore, if something unforeseen changes the situation, it is appropriate for the contractual provisions to change accordingly.

To be sure, any jurisdiction in drafting the provisions that relate to the termination of contracts sets the national rule somewhere in between these two opposites, abstract and theoretical antipodes. As a result of this, the rule in France is different from that which is followed in Germany, and so on. For example, in English law, there seems to be a preference for the pacta sunt servanda principle because the doctrine of frustration does not account for the change of the equilibrium between the performances of the parties.

The benefit of U.P.I.C.C. is that they provide common rules. The articles on force majeure and hardship, since the sequence of their words is applicable everywhere, set one point somewhere in between the two abstract Roman principles that can substitute the plethora of different national rules that allocate this point differently. As there is a high degree of attention to changes in circumstances, it could be argued that the rules are tilted toward the clausula rebus sic stantibus.

These common roots should not be disregarded or rejected. Owing to the persistent work of the coders of the U.P.I.C.C., parties have the possibility to choose “state-less” rules, which lower the costs of transactions and can be applied and understood by judges in every country.27

The non-execution of contracts itself already causes much damage to the economy, but as the world is slowly seeking to recover from the shock of the pandemic crisis, a quick and certain response from courts will help with the rapid allocation of resources between various subjects of civil disputes. Also, in cases where U.P.I.C.C. are not deliberately chosen by the parties, tribunals can use these principles to interpret and supplement national law. A coordinated approach from courts and tribunals is needed to give enterprises the possibility to quickly move past legal disputes, and to give them the tools to forecast their outcomes, thus avoiding further costs. This cannot happen if tribunals in various countries identify force majeure or hardship differently, as this would not only damage legal certainty but also the economy: it could discourage economic agents from undertaking business activities and undermine their trust in the legal order. Moreover, as the Secretariat stated in its Note on the UNIDROIT Principles of International Commercial Contracts and the COVID-19 health crisis, in the U.P.I.C.C. the requirements needed to identify a force majeure event or the occurrence of hardship are less strict than the ones that many national laws demand. Therefore, the UNIDROIT Principles provide a more reasonable solution to controversies, thus providing a versatile solution to an unprecedented problem like COVID-19.28

3. The harmonisation of transnational civil procedure

Subsequent to this sudden economic shock, which is not regionally symmetrical,29 numerous claims will reach the civil court system, and even more so in the aftermath of several procedural suspensions, delays, slowdowns and shutdowns.30 Prior to the COVID-19 pandemic, courts were already struggling to develop jurisdictional models to account for transnational relationships entered into without regard to the territorial boundaries of the national-state.31 The costs both for courts and individual claimants resulting from cross-border legal conflicts should therefore be mitigated by reducing differences in legal systems and applying the same or similar rules of the game.32

In this sense, a choice-of-forum approach is not enough during a global pandemic; what is needed is a set of rules that allows: (i) the facilitation of cross-border civil actions; (ii) more transparent civil proceedings, which will also encourage reconnections of international commercial relations;33 (iii) effective and fair substantive rules for debt recovery to avoid an insolvency domino effect; and (iv) will result in an effective transnational enforcement system of the court results. The ALI/UNIDROIT Principles of Transnational Civil Procedure34 have provided a set of rules35 that promote procedural substantive fairness without disavowing national legal traditions36 which show some similarities and some differences.37 The benefit of these rules is that they do not focus solely on the choice of the forum or recognition of sentences,38 but rather on the substantive rules of the civil process.39

In addition to individual commercial disputes, in the interconnected world even bankruptcies are no longer geographically isolated. Comparative insolvency law scholars distinguish two different approaches to cross border insolvencies: a vision called universalism advocates for the submission of the whole supranational bankruptcy to one court (and therefore, one national insolvency law). According to the contrary vision called territorialism, different national courts (and therefore, insolvency laws) should respectively process their “share” of corporate assets present on their territory. There are also those who claim that a company should be able to select which country’s or countries’ laws will apply if the firm encounters financial distress.40 Harmonisation of substantive insolvency law is necessary in either approach: from the universalism perspective, it is needed to ensure that the whole bankruptcy is processed by a national law that presents guarantees, and from the territorialism approach, it helps to prevent several bankruptcies from being processed without coordination through substantially divergent regimes.41

The ALI/UNIDROIT Principles approach could be applied for the harmonisation of substantive bankruptcy law42 through the design of common rules in insolvency proceedings.43 This would help coordinate the reallocation of production factors in the aftermath of the pandemic or grant a “fresh start” to companies that were financially affected. Bankruptcy law has, in fact, undergone a “Copernican revolution”, switching from its traditional role of liberating and reallocating production factors to eliminate “poisoned” companies from the market, toward a new role of reorganisation that can provide a fresh start for firms.44 For now, international initiatives45 have focused solely on the choice of jurisdiction and enforcement rules,46 cross-border filings and cooperation agreements,47 but the recent project that the UNIDROIT has engaged in could harmonise insolvency bank laws by promoting a uniform procedure for the liquidation of banks.48

4. International travels during a pandemic

The pandemic had a profound impact on travel49 and tourism50 in the summer of 2020. On 23rd April 2020, an extraordinary meeting of G20 tourism ministers was convened and a statement was issued, welcoming national efforts to mitigate the economic and social impact of the pandemic. Ministers pledged to work together to promote a sustainable and inclusive recovery of the tourism sector.51 Exactly fifty years earlier, on 23rd April 1970, the UNIDROIT International Convention on Travel Contracts (“CCV”) was signed in Brussels.52

Over the past 50 years, the travel industry has grown significantly: in 1970 fewer than 200 million people went on holiday abroad; in 2019, 1.5 billion people did.53 It is undeniable that the pandemic has changed this scenario. The deserted Rome, the city where the International Institute for the Unification of Private Law is located, is a good metaphor for what the pandemic represented in its most critical moments, where the streets that used to be crowded with tourists were suddenly emptied, leaving the engine of an entire economic sector without fuel.54

 The pandemic has affected tourism mobility and will continue to do so, given that borders have continuously been opened and closed, with unpredictable local lockdowns being put into place. In this context, as in every sector of the economy interconnected at the international level, the need for unified rules has been more pressing than ever.

This section focuses on the CCV because tourism is an area of the economy affected by the pandemic in which the UNIDROIT specifically produced an instrument. The CCV provides for a uniform discipline to a subject that is intrinsically international and recognises the importance of uniformity in the regulation of obligations and rights, both on the side of the travellers and on the side of travel organisers or travel intermediaries.

Even if this economic sector has significantly slowed down due to the pandemic, and reflections on how to revitalise tourism have subsequently arisen, this is a good opportunity to acknowledge the importance of this UNIDROIT instrument. During these uncertain times, the rules concerning traveller cancellation (art. 9 and 20), organisers withdrawal (art. 10), the obligation of the traveller to “furnish all necessary information specifically requested from him and comply with the regulations relating to the journey, sojourn or any other service” (art. 4), and travel organisers’ liability arising from loss or damage caused to the traveller as a result of non-performance (art. 13) are all relevant. Using the CCV rules guarantees a degree of certainty on applicable rules.

5. Conclusion

The difference between previous pandemics and the one caused by COVID-19 is captured in the words of WHO Director-General, Dr Tedros Adhanom Ghebreyesus, talking to the international press on 11th March 2020: “we have never before seen a pandemic that can be controlled”.55

The fact that this pandemic could be controlled has more than one implication: (i) all countries can take measures in order to slow down the spread of the disease, avoid the overcrowding of intensive care units, and thus make it possible for patients to be cured in a proper manner; (ii) governments can and have to mitigate the social and economic consequences connected to the pandemic; (iii) individuals have to sail through their individual legal relationships from a pre-pandemic scenario to a post-pandemic one, using the tools that private law provides.

The UNIDROIT instruments analysed throughout this article are different in nature and function: the U.P.I.C.C. are a piece of substantive law that discipline commercial contracts between international actors, the ALI/UNIDROIT Principles outline harmonised procedural rules when legal disputes arise, and the CCV regulate a very specific aspect of contract law relating to travel and tourism. Despite their differences, they form an integral framework seeking to move beyond political views and geographical borders. The UNIDROIT – in pursuing its goal to harmonise private law – creates a model of law which, due to the high degree of abstraction, the absence of references to particular national ethics, and the absence of contingent and time-conditioned concepts, can be applied to any form of society and economy. In this context, the political action of connection and mediation of the interests at stake, inherent to the law of legislative formation, faints. The UNIDROIT finds its strength in being an independent intergovernmental organisation. This feature is reflected in the working method adopted by the Institute in the drafting of the instruments: the members of the study groups appointed to prepare the preliminary draft are experts sitting in their personal capacity as opposed to being representatives of a particular interest group.56

In a time of crisis, when “global problems need global solutions”, UNIDROIT instruments can help build the post-pandemic world where relationships between international subjects have to be eased, costs of transactions have to be kept as low as possible and cooperation has to be encouraged. After all, while some borders continue to be closed, the post-pandemic world is likely to remain one of fast international economic exchanges, travels, and it will require the smooth resolution of international legal disputes. As such, UNIDROIT’s role in the post-pandemic world could and should be revitalised, through the renewed engagement of States before the momentum of international unity fades into the pre-pandemic status-quo.

---

[1] From the Antonine Plague (165-180 A.D.) to the Plague of Justinian (541-549 A.D.), from the Great Plague of London (1665-1666 A.D.) to the Spanish Flu (1918-1920 A.D.), such misfortunes have always occupied the attention of historiography. See Frank M Snowden, Epidemics and Society: From the Black Death to the Present (Yale University Press 2019). For an analysis of responses to past influenza pandemics, see Susan L Craddock and Tamara Giles-Vernick, Influenza and Public Health: Learning from Past Pandemics (Jennifer Gunn ed, Routledge 2010).

[2] Thucydides, History of the Peloponnesian War (George Bell & Sons 1893) paragraph 2.52: “the catastrophe was so overwhelming that men, not knowing what would happen next to them, became indifferent to every rule of religion or law”; paragraph 2.53: “In other respects also Athens owed to the plague the beginnings of a state of unprecedented lawlessness”.

[3] Robert Hollander, Boccaccio’s Dante and the shaping force of satire (University of Michigan Press 1997) 121, on the lawlessness generated by the plague.

[4] Jo N Hays, Epidemics and Pandemics: their impacts on human history ix (ABC-Clio 2005): “The significance of epidemics has not depended solely on their mortality rates. (…) The cholera pandemics of the nineteenth century, for example, often disrupted the societies they struck much more severely than their death tools would suggest”.

[5] Countries have used public law pondering health measures with constitutional rights. From an international law standpoint, see Armin von Bogdandy and Pedro Villarreal, ‘International Law on Pandemic Response: A First Stocktaking in Light of the Coronavirus Crisis’ (2020) MPIL Research Paper No. 07/2020. On the importance of the rule of law during the pandemic, see also Ministère de l’Europe et des Affaires étrangères, ‘Joint Statement on the Principles of the Rule of Law in Times of Covid-19 (02 Apr. 2020)’ (France Diplomacy – Ministry for Europe and Foreign Affairs) <https://www.diplomatie.gouv.fr/en/coming-to-france/coronavirus-advice-for-foreign-nationals-in-france/coronavirus-statements/article/joint-statement-on-the-principles-of-the-rule-of-law-in-times-of-covid-19-02> accessed 5 May 2021.

See also Judgment of the Supreme Court of Israel, case HCJ 769/02 (2006), The Public Committee Against Torture in Israel v. The Government of Israel, para 61-62. To put it in the words of Israeli judges: “It is when the cannons roar that we especially need the laws … Every struggle of the state … is conducted according to rules and law. There is always law which the state must comply with. There are no ‘black holes’”.

[6] Friedrich C von Savigny, the founder of the German Pandectist School, referred to private law as “patrimonial law”, consisting of property law and law of obligations, in his famous System of the Modern Roman Law: Friedrich Karl von Savigny, System of the Modern Roman Law (J Higginbotham 1867)

[7] ‘Statement by Bruno Le Maire, Minister of the Economy and Finance, on the economic impact of the COViD-19 epidemic and the support measures for businesses, in Paris on February 28, 2020’ (Vie publique.fr) <https://www.vie-publique.fr/discours/273763-bruno-le-maire-28022020-coronavirus> accessed 5 May 2021.

[8] United Kingdom Cabinet Office, Guidance on Responsible Contractual Behaviour in the Performance and Enforcement of Contracts Impacted by the COVID-19 Emergency, (7 May 2021) para 15(c) https://www.gov.uk/government/publications/guidance-on-responsible-contractual-behaviour-in-the-performance-and-enforcement-of-contracts-impacted-by-the-covid-19-emergency accessed 5 May 2021.

[9] Article 91, Law Decree 18/2020 (Italian Official Gazette, 17 March 2020).

[10] Ian Goldin and Mike Mariathasan, The butterfly defect: How Globalization Creates Systemic Risks, and What to Do about It (Princeton University Press 2014), on the consequences of living in a more interconnected, complex, and uncertain globalized world.

[11] Peterson K Ozili and Thankom Arun, ‘Spillover of COVID-19: Impact on the Global Economy’ (2020) MPRA Paper No. 99850/2020, https://mpra.ub.uni-muenchen.de/99850/ accessed 12 August 2021.

[12] Suborna Barua, ‘Understanding Coronanomics: The Economic Implications of the Coronavirus (COVID-19) Pandemic’ (University Library of Munich, Germany 2021) 55(3) JDA 435. See also Hiroyasu Inoue and Yasuyuki Todo, ‘The Propagation of the Economic Impact through Supply Chains: The Case of a Mega-City Lockdown against the Spread of COVID-19’ (2020) 15(9) PLOS ONE e0239251 <https://doi.org/10.1371/journal.pone.0239251> accessed 1 September 2021. See also Maryla Maliszewska, Aditya Mattoo and Dominique van der Mensbrugghe, ‘The Potential Impact of COVID-19 on GDP and Trade: A Preliminary Assessment’ (2020) World Bank Policy Research Working Paper No. 9211/2020, https://openknowledge.worldbank.org/handle/10986/33605 accessed 12 August 2021.

[13] It is what has been called a “process of mutual education and the expansion of understanding”: Joseph M Perillo, ‘UNIDROIT Principles of International Commercial Contracts: The Black Letter Text and a Review’ (1994) 63(2) Fordham Law Review 281, 284. See Michael J Bonell, An International Restatement of Contract Law: The UNIDROIT Principles of International Commercial Contracts (3rd edn, Transnational Pub Inc  2005) 26. On the flexible nature of the Principles, see also : Ceyda Sural, ‘Respecting the rules of law: the UNIDROIT Principles in national courts and international arbitration’ (2010) 14(2) VJ 249, 250-251.

[14] Fabrizio Marrella, ‘La nuova lex mercatoria, Principi UNIDROIT ed usi di contratti del commercio internazionale’, in Trattato Di Diritto Commerciale e Di Diritto Pubblico Dell’economia (Cedam 2003) vol XXX.

[15] Luigi Balestra, Introduzione al diritto dei contratti (Il Mulino 2015) 209.

[16] For the full list of the UNIDROIT instruments, see: ‘News and Events’ <www.unidroit.org/143-instruments> accessed 5 May 2021.

[17] Ş Esra Kiraz and Esra Yıldız Üstün, ‘COVID-19 and force majeure clauses: an examination of arbitral tribunal’s awards’ (2020) Uniform Law Review 1, 29.

[18] Taylor v. Caldwell (1863) 3 B. & S. 826 (QB).

[19] Klaus P Berger and Daniel Behn, ‘Force Majeure and Hardship in the Age of Corona: A Historical and Comparative Study’ (2019/2020) 6(4) McGill Journal of Dispute Resolution 79, 123.

[20] Hannes Rösler, ‘Hardship in German Codified Private Law: In Comparative Perspective to English, French and International Contract Law’ (2007) 15(4) European Review of Private Law 483.

[21] According to this theory, a change in circumstances not foreseeable at the time of the formation of the contract can lead to its revision in court, for the benefit of the party injured by the changed circumstances.

[22] Cass. civ., De Gallifet v. Commune de Pélissanne, March 6, 1876, D. 1876, 1, 193. See François Terré and Yves Leguette, Les grands arrêts de la jurisprudence civile (Dalloz 1994) 406-413.

[23] Tobias Lutzi, ‘Introducing Imprévision into French Contract Law – A Paradigm Shift in Comparative Perspective’, in Sophie Stijns and Sanne Jansen (eds), The French Contract Law Reform: a Source of Inspiration? (Intersentia 2016) vol 153, 89. Force majeure is regulated by article 1218 of the French Civil Code as that event which prevents the fulfilment of the debtor’s obligations, which could not be foreseen at the time of concluding the contract and whose effects could not be avoided by appropriate measures.

[24] UNIDROIT Principles of International Commercial Contracts 2016, Preamble: “These Principles set forth general rules for international commercial contracts. They shall be applied when the parties have agreed that their contract be governed by them. They may be applied when the parties have agreed that their contract be governed by general principles of law, the lex mercatoria or the like. They may be applied when the parties have not chosen any law to govern their contract. They may be used to interpret or supplement international uniform law instruments. They may be used to interpret or supplement domestic law. They may serve as a model for national and international legislators”.

[25] Berger and Behn (n 19).

[26] ibid 86.

[27] Arthur I Rosett, ‘Part I: The UNIDROIT Principles of International Commercial Contracts: A New Approach to International Commercial Contracts’ (1998) 46 The American Journal of Comparative Law 347, 347: “The Principles demonstrate that basic principles of contract law can be agreed upon by all major legal systems in a form that is, not too vague and general to be useful in the resolution of specific disputes”.

[28] ‘Note of the UNIDROIT Secretariat on the UNIDROIT Principles of International Commercial Contracts and the COVID-19 Health Crisis’ https://www.unidroit.org/english/news/2020/200721-principles-covid19-note/note-e.pdf accessed 5 May 2021.

[29] Nuno Fernandes, ‘Economic Effects of Coronavirus Outbreak (COVID-19) on the World Economy’ IESE Business School Working Paper No. WP-1240-E/2020, https://ssrn.com/abstract=3557504 accessed 12 August 2021.

[30] Among all, for the United States: ‘Some Courts Slow Reopening Plans as COVID Cases Rise’ (United States Courts, 16 July 2020), https://www.uscourts.gov/news/2020/07/16/some-courts-slow-reopening-plans-covid-cases-rise accessed 5 May 2021. See also: National Center for State Courts, ‘Coronavirus and the courts’, https://www.ncsc.org/newsroom/public-health-emergency accessed 5 May 2021. See also, for the United Kingdom: ‘Coronavirus (COVID-19): Courts and Tribunals Guidance’ (GOV.UK) https://www.gov.uk/guidance/coronavirus-covid-19-courts-and-tribunals-planning-and-preparation accessed 5 May 2021.

[31] Paul S Berman, ‘From International Law to Law and Globalization’ (2005) 43(2) Columbia Journal of Transnational Law 485, 530.

[32] Geoffrey C Hazard Jr and others, ‘Introduction to the Principles and Rules of Transnational Civil Procedure’ (2001) 33 New York University Journal of International Law & Politics 769, 769.

[33] Antonio Gidi, ‘Notes on Criticizing the Proposed ALI / UNIDROIT Principles and Rules of  Transnational Civil  Procedure’ (2001) 6(4) Uniform Law Review 819, 820.

[34] Frédérique Ferrand, ‘La procédure civile internationale et la procédure civile transnationale: l’incidence de l’intégration économique régionale’ (2003) 56 Derecho PUCP 361, 394-405. The Principles were written with the American Law Institute, which later produced the Rules of Transnational Civil Procedure to regionally adapt the Principles to the American context. The project ELI/UNIDROIT Transnational Rules of Civil Procedure (jointly with the European Law Institute) aims at regionally implementing the Principles in the European context. The Rules were approved by the ELI Council and Membership in summer 2020, as well by the UNIDROIT Governing Council on 23-25 September 2020. The final text will be published by Oxford University Press in 2021. On the history of the ALI/UNIDROIT Principles and their impact on the European rules of civil procedure, see also: Xandra E Kramer, ‘Towards ELI-Unidroit Model Rules of Civil Procedure: Basic Premises and Challenges’ (Short Paper presented at the Bay Area Civil Procedure Forum, 2016), https://ssrn.com/abstract=2828148 accessed 12 August 2021. Xandra E Kramer, ‘The Structure of Civil Proceedings and Why It Matters: Exploratory Observations on Future ELI-UNIDROIT European Rules of Civil Procedure’ (2014) 19(2) Uniform Law Review 218. On the application of the ALI/UNIDROIT Principles on procedural contracts, see also: Stacie I Strong, ‘Why is Harmonization of Common Law and Civil Law Procedures Possible in Arbitration But Not Litigation?’ (2013) Univ. of Missouri School of Law Legal Studies Res. Paper No. 12/2013, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2266672 accessed 1 September 2021.

[35] They address judicial relief for commercial dispute through common rules on independence and impartiality of the Judges, procedural equality of the parties, prompt rendition of justice, structure of the proceedings, claims, evidences, oral and written presentations, burden and standard of proof, settlement, costs, enforceability of judgments, appeal, res judicata.

[36] On the risk of an interpretation in the light of national law that would dilute the harmonisation attempt, see Gidi (n 33) 820.

[37] For similarities and differences among jurisdictions on civil procedural rules, see Hazard Jr and others (n 32) 772. Jeffrey S Parker, ‘Comparative civil procedure and transnational “harmonization”: a law-and-economics perspective’ (2009) George Mason Law & Econ. Res. Paper No. 03/2009.

[38] ALI/UNIDROIT Principles of Transnational Civil Procedure art 30. See also: ALI/UNIDROIT Principles of Transnational Civil Procedure art 31, on international judicial cooperation.

[39] Hazard Jr and others (n 32) 770-771. Also, common procedural rules can help bridge the gap that has been created between international commercial litigation and international arbitration, the latter equipped with recognized enforcement mechanisms. The underdevelopment of international litigation is mainly due to the suspicion that States continue to demonstrate toward results of civil cases decided in other jurisdictions. Common standards would address this. See Strong (n 34).

[40] Robert K Rasmussen, ‘A New Approach to Transnational Insolvencies’ (1997) 19(1) Michigan Journal of International Law 1.

[41] To deepen the theoretical debate, see Edward S Adams and Jason K Fincke, ‘Coordinating cross-border bankruptcy: how territorialism saves universalism’ (2009) 15 Columbia Journal of European Law 43. See also Andrew T Guzman, ‘International Bankruptcy: In Defense of Universalism’ (2000) 98(7) Michigan Law Review 2177. See also Adrian Walters, ‘Modified universalisms & the role of local legal culture in the making of cross-border insolvency law’ (2019) 93(1) American Bankruptcy Law Journal 47. See also Jay Lawrence Westbrook, ‘A Global Solution to Multinational Default’ (2000) 98(7) Michigan Law Review  2276. See also John A E Pottow, ‘The Myth (and Realities) of Forum Shopping in Transnational Insolvency’ (2007) 32(3) Brooklyn Journal of International Law 785. See also Lucian A Bebchuk and Andrew T Guzman, ‘An Economic Analysis of Transnational Bankruptcies’ (1999) 42(2) The Journal of Law and Economics 775. See also Frederick Tung, ‘Is international bankruptcy possible?’ (2001) 23(1) Michigan Journal of International Law 31. See also Frederick Tung, ‘Skepticism about Universalism: International Bankruptcy and International Relations’ (2001) U.C. Berkeley Law and Economics Working Paper No. 7/2001 <https://papers.ssrn.com/abstract=267437> accessed 1 September 2021. See also Lynn M LoPucki, ‘Cooperation in international bankruptcy: a post-universalist approach’ (1999) 84(3) Cornell Law Review 696.

[42] Robert K Rasmussen, ‘Resolving Transnational insolvencies through private ordering’ (2000) 98(7) Michigan Law Review 2252, 2252: “International bankruptcy law as it currently exists is … in reality, domestic bankruptcy law. The challenge for each nation’s domestic law in this area is to mediate the tensions that arise because the firm and its creditors are spread across more than one jurisdiction.  This question becomes difficult in large measure because each country’s domestic bankruptcy laws diverge”.. See also Thomas M Gaa, ‘Harmonization of International Bankruptcy Law and Practice: Is It Necessary? Is It Possible?’ (1993) 27(4) The International Lawyer 881.

[43] For a study across 88 jurisdictions focused on differences (and efficiency) of insolvency mechanisms, see Simeon Djankov and others, ‘Debt Enforcement Around the World’ (2008) 116(6) Journal of Political Economy 1105.

[44] Mark J Roe, ‘Three ages of bankruptcy’ (2017) 7 Harvard Business Law Review 187. In this sense, national bankruptcy laws, perhaps modified temporarily, can allow, with monetary measures, to mitigate the effects of the pandemic, which generates insolvencies not only caused by the market (i.e. a drop in demand or a change in consumption methods) but also with health-related restrictions that determine a change in the production method, or even a direct block of production activities. See also Aurelio Gurrea-Martínez, ‘Insolvency Law in Times of COVID-19’ (2020) Ibero-American Institute for Law and Finance Working Paper No. 2/2020 <https://papers.ssrn.com/abstract=3562685> accessed 1 September 2021, for proposed insolvency law reforms. In any case, common procedures for fresh starts are necessary to ensure equal treatment for companies around the world.

[45] Anthony T Sexton, ‘Current problems and Trends in the Administration of Transnational Insolvencies Involving Enterprise Groups: The Mixed Record of Protocols, the UNCITRAL Model Insolvency Law, and the EU Insolvency Regulation’ (2012) 12(2) Chicago Journal of International Law 811.

[46] UNCITRAL’s Model Law on Cross-Border Insolvency addresses cooperation issues but not uniform substantial insolvency law. See, in relationship with the universalism and territorialism debate: Alexander M Kipnis, ‘Beyond UNCITRAL: Alternatives to Universality in Transitional Insolvency’ (2007) 36(2) Denver Journal of International Law & Policy 155.

[47] Francisco Satiro and Paulo F C Filho, ‘Transnational Insolvency: Beyond State Regulation and Towards Cooperation Agreements’ (2011) SSRN Scholarly Paper ID 1858968 https://ssrn.com/abstract=1858968 accessed 12 August 2021.

[48] The project, done jointly with the Bank of Italy and the European Banking Institute (EBI), is called “Insolvency law: the harmonisation of national insolvency laws for the liquidation of banks and rules of cooperation and coordination in cross border cases”.

[49] Barbara von Tigerstrom and Kumanan Wilson, ‘COVID-19 travel restrictions and the International Health Regulations (2005)’ (2020) 5 BMJ Global Health e002629.

[50] Gokhan Karabulut and others, ‘How Pandemics Affect Tourism: International Evidence’ (2020) 84 Annals of Tourism Research 102991.

[51] ‘G20 Tourism Ministers’ Statement on COVID-19’ http://www.g20.utoronto.ca/2020/2020-g20-tourism-0424.html accessed 5 May 2021.

[52] Maria Goretti and Sanches Lima, Traveller Vulnerability in the Context of Travel and Tourism Contracts (Springer 2018) 190. The Convention is fully consistent with the idea that travel is a holistic experience organized or brokered by an operator and not relegated only to a transport contract. The CCV distinguishes, in an avant-garde way, organisation contracts (with multiple services sold together as a unit at a “global price”) from travel brokerage contracts (in which individual services are also sold).

[53] ‘How tourism will survive the pandemic’ (The Economist, 28 May 2020), https://www.economist.com/leaders/2020/05/28/how-tourism-will-survive-the-pandemic accessed 5 May 2021.

[54] For a touching photographic memoir, see Lorenzo Zichichi and Angelo Cricchi, Nolite timere, Roma non perit 2020. Roma ai tempi del coronavirus. Fotografie e testimonianze (Il Cigno GG Edizioni 2020).

[55] ‘WHO Director-General’s opening remarks at the media briefing on COVID-19 – 11 March 2020https://www.who.int/dg/speeches/detail/who-director-general-s-opening-remarks-at-the-media-briefing-on-covid-19—11-march-2020 accessed 5 May 2021.

[56] Bonell (n 13) 33.

Michele Corgatelli

JD (Catholic University of Milan) ’20, LLM (Glasgow) ’22

Francesca Giordanelli

JD (University of Bologna) ’21, LLM (King’s College London) ’21