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14 November 2008
In 1998 a pond containing toxic water burst at a Spanish mine owned by a subsidiary of the Swedish company Boliden. The subsidiary subsequently went bankrupt with a shortage of nearly Skr1.5 billion. The bankruptcy estate brought a lawsuit against Boliden AB and Boliden Mineral AB with a request for sequestration. A Swedish court of appeal, after a review which is possible only in this type of case, established that the Spanish order of sequestration was enforceable in Sweden.
The bankruptcy estate argued before the Swedish court that the Spanish order fell within the Swedish Insolvency Regulation and therefore should be enforced in accordance with the Brussels I Regulation. The Boliden companies argued that the Spanish order was made in the absence of the opposing party, and that enforcement under the Brussels I Regulation requires that the right to defence must have been respected in the state of origin, as ruled in the Denilauler Case. The Boliden companies also argued that execution of the Spanish order would be contrary to both public policy and Article 6 of the European Convention on Human Rights.
In Denilauler the European Court of Justice held, among other things, that interim measures which are intended to be executed and enforced without first having heard and served the party to which they are addressed are not covered by the Brussels I Regulation system for recognition and enforcement. Furthermore, the court stated that security can be requested directly through a court in the country in which the property is located, and that such court is best suited to appraise the circumstances which may lead to the measures requested being granted or refused. According to Denilauler, the court in the country where the property is located is also best suited to stipulate rules and conditions for the applicant.
The Swedish Court of Appeal held that neither Denilauler nor any other ground implied that the Spanish order of sequestration could be refused execution in Sweden. Furthermore, the court stated that the Skr1.4 billion that the Boliden companies sought as security should be provided.
For further information on this topic please contact Margareta Andersson or Jörgen Wistrand at Wistrand Advokatbyrå by telephone (+46 31 771 21 00) or by fax (+46 31 771 21 50) or by email (email@example.com or firstname.lastname@example.org).
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