EURO-AMERICAN LAWYERS GROUP, Briefings

EALG BRIEFING OCTOBER 2005 VOL. 2 NO. 4

A SUMMARY OF RECENT LEGAL DEVELOPMENTS IN EUROPE AND THE UNITED STATES
COMPILED BY MEMBERS OF THE EURO-AMERICAN LAWYERS GROUP.

IN THIS ISSUE:

ITALY

REFORM OF THE ITALIAN CODE OF CIVIL PROCEDURE

THE NETHERLANDS

THE TOP 10 BOTHERSOME RULES FOR BUSINESSES IN THE NETHERLANDS
ALL EXISTING PUBLIC LAW PERMIT SYSTEMS ARE UNDER REVIEW
LIMITS ON CROSS-BORDER JURISDICTION IN DUTCH COURTS

PORTUGAL

EU DIRECTIVE ON UNFAIR COMMERCIAL PRACTICES

SWITZERLAND

EXEMPTION OF FOREIGN INVESTMENT FUNDS FROM THE SWISS STAMP DUTY

THE UNITED KINGDOM: SCOTLAND

NEW FIRE LEGISLATION
UK CHANGES TO EMPLOYMENT LAW - WHAT EMPLOYERS MUST KNOW
HATFIELD FINES FOR BREACHES OF HEALTH AND SAFETY REGULATIONS

UNITED STATES

DELAWARE COURT ADDRESSES DUTIES OF DIRECTORS OF PUBLIC COMPANIES
CONSUMER PRODUCT SAFETY ISSUES IN THE UNITED STATES VERSUS THE EU
NEW REMEDY FOR PRESCRIPTION DRUG PRICING IN WASHINGTON, D.C.
EMPLOYMENT DISCRIMINATION: EMPLOYERS BEWARE OF SHOUTING MANAGERS
UPCOMING DEVELOPMENTS IN ELECTRONIC DISCOVERY

ABOUT THE EURO-AMERICAN LAWYERS GROUP (EALG)

ITALY
REFORM OF THE ITALIAN CODE OF CIVIL PROCEDURE

On 14th May 2005 the Italian Parliament passed an act to reform the Italian Code of Civil Procedure. The new law will come into force on January 1, 2006. The aim of the reform is to shorten the length of civil proceedings. In order to further this purpose, a stronger system of preclusions has been introduced. In addition, the number of hearings and written briefs in civil proceedings has been reduced. According to the first comments, the new civil procedure rules will attach more importance to the oral phase of the proceeding, even though there is a dangerous risk of reduction of the right of defense.

For further details, please contact Marco Grando, Partner, Studio Legale Fumagalli E Grando, Milan, Italy; fumagalli.grando@studiolegale.ms

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THE NETHERLANDS
THE TOP 10 BOTHERSOME RULES FOR BUSINESSES IN THE NETHERLANDS

The Ministry of Economic Affairs has published a Top 10 of bothersome rules for businesses. The cabinet seeks by means of this Top 10 to chart the bottlenecks which businesses experience as most bothersome in practice and which according to them should be dealt with first. The Ministry asked for this Top 10 after complaints of businesses that the government initiatives for dealing with the pressure caused by regulations are too abstract and fragmented and do not sufficiently align with daily business practice. It is the first of two reports with recommendations to the cabinet.

For further details, please read the full article at the EALG News/Information web page, or contact Jurgen van Berkel, De Boort Hermes De Bont, Tilburg, Holland, j.vanberkel@devoort.nl; http://www.devoort.nl.

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THE NETHERLANDS
ALL EXISTING PUBLIC LAW PERMIT SYSTEMS ARE UNDER REVIEW

In order to substantially reduce the permit burden, all existing permit systems will be checked as to usefulness and necessity on the basis of government regulations before 1 May 2006. Permit systems which do not satisfy the conditions will disappear or be converted into general rules.

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THE NETHERLANDS
LIMITS ON CROSS-BORDER JURISDICTION IN DUTCH COURTS

The Dutch court does not have unlimited jurisdiction to impose cross-border injunctions. According to established jurisprudence the court may not impose a cross-border injunction if its jurisdiction is based on wrongful act and the defendant is domiciled in a country which is a party to the Brussels or Lugano Convention. However, whether this rule also applies if the defendant is domiciled outside of the countries which are a party to the Brussels Convention, is unclear.

It can be deduced from the judgment of 19 March 2004 of the Supreme Court in the Philips/Postech case that if the court has jurisdiction, it also has jurisdiction to make cross-border orders. In the judgment of the District Court of The Hague of 31 August 2005 there was an American plaintiff and an Indian defendant. The issue was whether the Dutch court has the jurisdiction to make a cross-border declaratory judgment. The court held that this was not the case.

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PORTUGAL
EU DIRECTIVE ON UNFAIR COMMERCIAL PRACTICES

The European Commission has published the Parliament and Council's Directive 2005/29/CE regarding unfair business-to-consumer business practices. The Directive regulates unfair commercial practices that have a purpose of distorting the consumer's economic behavior. It generally forbids unfair commercial practices and specifically forbids misleading and aggressive business practices. It is expected that the new Directive will be a defense mechanism for consumers against certain forms of unfair business practices.

For further details, please read the full article at the EALG News/Information web page, or contact Barros, Sobral. G. Gomes e Associados, Lisbon, Portugal; law@bsgg.pt; http://www.bsgg.pt.

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SWITZERLAND
EXEMPTION OF FOREIGN INVESTMENT FUNDS FROM THE SWISS STAMP DUTY

To ensure its competitive posture in the international financial markets, a recent Swiss law exempts foreign investment funds from the Swiss stamp duty. The Swiss Tax Administration has now unilaterally decided to add three conditions that foreign investment funds must meet in order to qualify for the stamp duty exemption. Imposition of these three additional conditions has taken both investors and banks by surprise, since they are not founded in any statutory or regulatory provision. A legal challenge to the actions of the Tax Administration is currently pending.

For further details, please read the full article at the EALG News/Information web page, or contact Douglas Hornung, Partner, Fontanet Jeandin Hornung & Partners, Geneva, Switzerland; d.hornung@fontanet.ch; http://www.fontanet.ch.

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THE UNITED KINGDOM: SCOTLAND
NEW FIRE LEGISLATION

The Fire (Scotland) Act 2005 was given Royal Assent on 2nd August. Part 3 of the Act comes into force in Spring 2006. The precise date is not yet known. It introduces new fire safety regimes for premises other than private dwellings.

For further details, please contact Elena Fry, Partner, Biggart Baillie, Glasgow, Scotland; efry@biggartbaillie.co.uk; http://www.biggartbaillie.co.uk.

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THE UNITED KINGDOM: SCOTLAND
UK CHANGES TO EMPLOYMENT LAW - WHAT EMPLOYERS MUST KNOW

Significant changes to Employment Law took effect in the UK on October 1, 2005. Employers must take care to ensure that they are aware of these changes and act accordingly. Areas where there have been changes in the law include the national minimum wage; sex discrimination; union recognition and industrial action; and employment tribunals.

For additional details, please read the full article at the EALG News/Information web page, or contact Paul Brown, Partner, Biggart Baillie, Glasgow, Scotland; pbrown@biggartbaillie.co.uk; http://www.biggartbaillie.co.uk

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THE UNITED KINGDOM: SCOTLAND
HATFIELD FINES FOR BREACHES OF HEALTH AND SAFETY REGULATIONS

Network Rail and Balfour Beatty have been fined £3.5 million and £10 million respectively for breaches of Health and Safety regulations, following the Hatfield derailment on 17 October 2000. They were each ordered to pay £300,000 in costs. There were 4 fatalities and over 100 people injured in the derailment. In delivering his judgment, Mr Justice Mackay declared the incident: "the worst example of sustained industrial negligence in a high-risk industry” he had ever seen.

For additional details, please contact Laura Brain, Solicitor, Biggart Baillie, Glasgow, Scotland; lbrain@biggartbaillie.co.uk; http://www.biggartbaillie.co.uk

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UNITED STATES
DELAWARE COURT ADDRESSES DUTIES OF DIRECTORS OF PUBLIC COMPANIES

On August 9, 2005, the Delaware Court of Chancery issued its long awaited decision in the highly-publicized case of In re Walt Disney Company Derivative Litigation. In the case, the Delaware Court held that the Disney Directors did not violate their fiduciary duties or commit waste by providing Disney’s former President, Michael Ovitz, with an estimated $140 million severance package just 14 months after his having been hired.

For additional details, please read the full article at the EALG NEWS/Information web page, or contact Marshall N. Lester, Partner, Warshaw Burstein Cohen Schlesinger & Kuh, LLP, New York, New York; mlester@wbcsk.com; http://www.wbcsk.com.

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UNITED STATES
CONSUMER PRODUCT SAFETY ISSUES IN THE UNITED STATES VERSUS THE EU

The EU law governing consumer product safety and product liability issues has been strongly influenced by U.S. law. However, there are also a number of areas where the EU and U.S. legal obligations differ. This is especially so with respect to the reporting obligations and time frames governing the notification of unsafe products and whether such notification and subsequent communications with governmental officials will be kept confidential. U.S. companies, in particular, must be aware of the generally stricter reporting standards that exist in the EU in order to avoid any surprises.

For additional details, contact please read the full article at the EALG NEWS/Information web page or contact John N. Zarian, Partner, O'Brien Zarian LLP, Los Angeles, California; jzarian@obrienzarian.com; http://www.obrienzarian.com.

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UNITED STATES
NEW REMEDY FOR PRESCRIPTION DRUG PRICING IN WASHINGTON, D.C.

In an unusual but innovative first, the District of Columbia local Government has passed a bill that takes direct aim at excessive prescription drug costs. Legislation passed by the DC Council says that any person including public interest organizations directly or indirectly affected by overpriced prescription pricing may file a legal action against the drug company and seller of the drugs. The twist here is that the law allows the plaintiff to make out a case of excessive pricing in the first instance if the pricing is 30% or more than the same drug product being sold in Canada, the United Kingdom, Germany or Australia. The burden will then shift to the defendant to prove that the pricing is not excessive. While the actions of the local government in Washington, D.C., usually do not influence the policy decisions of the federal government, they are frequently noticed by policy makers and the national media. The recent actions by the D.C. government reflect efforts made by other localities to reduce the costs of prescription medications in the United States.

For additional details, contact Ronald N. Cobert, Partner, or Andrew M. Danas, Partner, Grove, Jaskiewicz and Cobert, Washington, D.C.; rcobert@gjcobert.com; adanas@gjcobert.com; http://www.gjcobert.com.

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UNITED STATES
EMPLOYMENT DISCRIMINATION: EMPLOYERS BEWARE OF SHOUTING MANAGERS

If they have not done so already, employers should be warning their managers that shouting, screaming, and using foul language will not be tolerated in the work place. A recent Federal 9th Circuit Appeals Court has held that such offensive conduct which is not facially sex specific nonetheless may violate Title VII of the 1964 Civil Rights Act. The Judge writing the decision for the Court said that the case illustrates an alternative motivational theory in which an abusive bully takes advantage of a traditionally female workplace because he is more comfortable when bullying women than when bullying men.

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UNITED STATES
UPCOMING DEVELOPMENTS IN ELECTRONIC DISCOVERY

Lawyers, and particularly those who are litigators, must be savvy these days about information technology and the techniques used by clients in electronically storing information. The Federal Courts are in the process of finalizing changes to the Federal Rules of Civil Procedure which will standardize procedures regarding the discovery in Federal Court litigation of electronic communications including e-mails and digitally stored documents. The new rules address such matters as early intervention by the Judge in the discovery process, the preservation of electronically stored data once the litigation has commenced, the treatment of cost issues on information that is not reasonably accessible, and the process of asserting privilege by the target party. This is not necessarily an entirely new world for seasoned litigators who have dealt with electronic discovery in the past; however this new emphasis brings the electronic storage process to the front and center stage.

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ABOUT THE EALG

The Euro-American Lawyers Group (EALG) is an association of Law Firms founded in 1985. The members of the EALG believe that they can best serve their clients' interests overseas by co-operating with like-minded firms who have local knowledge of, and immediate access to, the legal system operating in their own jurisdiction.

Eagle's philosophy is that local representation is vital in today's dynamic market where both legislation and commercial practice is changing regularly at both the national and international levels.

The EALG has steadily developed since its inception in 1985. It now comprises twenty seven (27) law firms working in 20 different jurisdictions. Each member has their own network of local contacts.

With member firms throughout Europe, the United States, and Asia, the EALG provides excellent communications to many of the important commercial centres of the world and access to hundreds of lawyers. For further information about the EALG and its member law firms, please visit our web site at http://www.ealg.com.

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EALG BRIEFING is a free monthly e-mail publication of the Euro-American Lawyers Group (EALG) and is distributed by EALG member law firms. The articles contained in EALG BRIEFING are a brief overview of recent legal developments in Europe and the United States. The articles do not constitute legal opinions or advice and should not be regarded or relied upon as such. By using this publication you agree to the Terms and Conditions of the EALG, which may be viewed on our web site at http://www.ealg.com. If you have colleagues who may wish to subscribe to EALG BRIEFING, please feel free to pass along this e-mail to them. To subscribe and be placed on our distribution list, they may send an e-mail to adanas@gjcobert.com or to the EALG contact in their jurisdiction. To unsubscribe, please send an e-mail to the same address(es).