Volume 6, Number 20, Page 2
Overview of the Venezuelan Private International Law
By Eugenio Hernández-Breton
The new Venezuelan Private International Law, which entered into effect on February 6, 1999, constitutes a significant reform and the first codification of private international law in Venezuela. A new chapter in the history of Venezuelan law began when the Law entered into effect. This Law takes a broad view of the purpose of private international law. In this regard, it regulates both private international law, in a strict sense, as well as international civil procedural law.
The Venezuelan Private International Law (the “Law”) has as its origin the draft of a bill of Standards for Private International Law prepared between 1958 and 1963, and subsequently reformed in 1965. Over the following 30 years, the bill was viewed favorably both in Venezuela and abroad, although it never became the subject of any real public discussion in Venezuela. In fact, it was never clear whether the Bill had ever been presented to Congress for debate. The bill was kept alive in academic circles and the solutions it offered were frequently considered as generally accepted principles in private international law. As such, they were applied to resolve problems containing foreign elements.
The bill was resurrected in July 1995 when the First National Meeting of Private International Law Professors was held. They unanimously agreed to send a message to the Minister of Justice urging that the original bill be submitted to Congress for its consideration and approval, a move that the Minister supported. However, in view of the developments concerning Private International Law in the Americas since 1975, as a result of the work from the Specialized Inter-American Conferences on Private International Law, it had become necessary to revise the bill’ s provisions. In April 1996, the Second National Meeting of Private International Law Professors was held. That meeting dealt exclusively with examining and reconsidering the bill, with reports being presented by professors from Universidad Central de Venezuela (UCV) and Universidad Cato1ica Andrés Bello (UCAB). However, the most important aspect of the meeting was that it addressed the bill’s impact on current Venezuelan law. A few months later, the professors from UCV and UCAB responsible for coordinating the review heard the observations of Professor Parra Aranguren, one of the original drafters of the bill.
In reviewing the bill (which was to become the 1996 Bill), the Inter-American Conventions, ratified by Venezuela from 1975 to 1994, played an important role. The Venezuelan delegation’s decisive participation in preparing these conventions justified the partial incorporation of their provisions into the 1996 Bill. In addition, in reviewing international civil procedural law standards, the 1986 Civil Procedural Code (in effect since 1987) was also considered. The Bill was then revised and presented to the Senate. A lengthy political discussion then began. Professors from UCV and UCAB once again joined forces to demonstrate to the Senate and the Chamber of Deputies that passing the 1996 Bill was warranted and necessary.
One objection raised in the Senate, perhaps the main objection, was the Law’s proposed name: the Law of Standards of Private International Law. Given that a name change was not a substantive change, it was quickly agreed to call it the Bill on Private International Law. Fortunately, other objections concerning the name of the Law were rapidly discarded. The discussion process continued slowly and, by the beginning of 1998, the bill had to be modified to adapt to the new Law of Commercial Arbitration. In October 1997, the UCV and UCAB professors once again undertook the task of publicly presenting the provisions of the modified bill in a series of conferences, whose information was published in August 1998, by coincidence only a few days after the Law was published in the Official Gazette. As the text of the Law differs only slightly from the text of the 1996 Bill, these conferences could therefore be considered the first commentary on the Law.
The General Provisions of the Law partially regulate the institutions of general theory of private international law. Even in its provisions which reflect its originality, the Law observes the provisions of the Inter-American Convention on General Standards of Private International Law (Montevideo, 1979). Among the Law’s innovations is the inclusion of the standards of public international law as one of the sources for Venezuelan private international law (Article 1). The Law regulates matters concerning the application of foreign law as applied in the country of origin, provided that the following are observed: Venezuelan standards on conflict of laws (Article2); solutions to inter-locale or inter-personal conflicts (Article3); acquired rights (Article 5); adaptation (Article 7); public policy (Article 8); unknown institutions (Article 9); and the application of mandatory standards of the forum (Article 10). However, the provision that stands out is on the regulation of remand (Article 4), which was written 35 years ago. In this regard, the Law partially coincides with the solution in Article 13(1) (a) and (b) of the Law of the Reform of the Italian System of the 1995 Private International Law, but the Law goes beyond that by regulating an additional assumption. The Law expressly omitted regulating the matter of qualification, quite possibly the most difficult area in international private law. Nor did it include a regulation on fraud, which is regulated in Article 6 of the Inter-American Convention on General Standards of Private International Law. This omission may only be interpreted as a rejection of such regulation.
The truly important reform of private international law is in the adoption of the factors of domicile connection and abandonment of nationality connection to regulate the capacity of physical persons, including matrimonial capacity, effects of matrimony, divorce, and legal separation, filiation, paternal/filial relations, adoption, guardianship and other institutions for the protection of the disabled, and successions (Articles 16,21,22,23,24,25,26, and 34). The domicile of an individual is located in the territory of the country of habitual residence (Article 11). Married couples may have different domiciles (Article 12). The domicile of minors or handicapped individuals is determined separately from that of his or her parents or legal representatives (Article 13). The sole paragraph of Article 23 of the Law attempts to correct alleged fraud regarding divorce. It provides that the change of domicile of the plaintiff spouse becomes effective one year after having entered the territory of one country with the intention of establishing his or her habitual residence. Domicile also plays a fundamental role as a criterion for jurisdiction (Articles 15 and 39). Because the Law does not establish criteria to determine the domicile of legal entities, such domicile will be determined in accordance with Articles 27, 28, and 29 of the Venezuelan Civil Code and Article 203 of the Venezuelan Commercial Code, in which case the provisions set forth in the Articles of Incorporation concerning the address or administration or main place of business, as the case may be, will be followed, except as provided in special laws. The adoption of the domicile criterion has in effect abandoned the Venezuelan practice, in effect since 1862, by which jurisdictional law was governed by the law of the nationality of the effected persons.
Basis law governing real property is governed by lex rei sitae (Article 27). A change of location does not affect rights validly constituted under the previous law. However, such rights may only be opposed by third parties after they comply with the requirements established by law concerning the new situation (Article 28).
The Law, in the regulation of contractual obligations, follows the guidelines of the InterAmerican Convention on Law Applicable to International Contracts (Mexico, 1994) including: autonomy of the parties, closer ties, and application of lex mercatoria (Articles 29 to 31). Obligations arising from illicit acts are regulated, at the victim’ s discretion, either by the laws of the jurisdiction where the event generating the illicit act took place or the laws of the jurisdiction where the effects of such act are evident (Article 32). The laws of the jurisdiction govern all business management, improper payment, and unjustified enrichment where the act creating the obligation occurs (Article 33). The regulation of the acts is to be done in a flexible and alternate manner, under the law which governs the content of the act, or of the domicile of its grantor, or of the common domicile of its grantors (Article 37). Thus, the rigidity of the rule of locus regit forman actus contained in Article 11 of the Civil Code is abandoned.
In general, the Law does not independently regulate matters concerning international business law, although it does annul some provisions thereof. This is in response to an alleged tendency to make private law uniform and to circumstances under which private international law regulations on civil matters are generally either the same as those in commercial law or logically derived therefrom.
Additionally, it was considered that the standards concerning special matters-insurance, bankruptcy, securities, or companies-should be provided for in special laws, following the general principles established in the Law.
In international civil procedure the governing rule is locus regit processum (Article 57). The Law reorganizes and modifies the question of the jurisdiction of Venezuelan courts (Articles 39 to 47). The Law does not use the expression “international procedural jurisdiction” because that may be confused with the notion of “internal territorial jurisdiction,” which is also regulated in Articles 48 to 52. The basic criterion for the attribution of jurisdiction is the domicile of the defendant- a criterion, however, which is acknowledged only implicitly. This allows the voluntary submission of acts, either expressly or implicitly, to Venezuelan courts concerning patrimony without requiring any kind of relationship with Venezuelan territory (Article 40(4)). In matters related to a person’s condition or family relationships, voluntary submission is allowed provided that there is an actual link to Venezuelan territory (Article 42(2)). However, both provisions confirm the provisions in current legislation (Articles 53(3) and 57(2)). The specific submission must be evidenced in writing (Article 44), and this is tacitly acknowledged when the plaintiff presents the claim or, for the defendant, when he appears at trial, either personally or through an attorney, any act other than a special appearance to present an affirmative defense or oppose a preventive or equitable measure (Article 45). The submission is not valid for acts which affect the creation, modification, or elimination of federal taxes on personal property, unless this is admitted by the laws of the jurisdiction where the property is located (Article 46).
The conventional overruling of Venezuelan jurisdiction is currently regulated by Article 47 of the Law, which clarifies and repeals the incomprehensible Article 2 of the Civil Procedural Code. In this way, bypassing of Venezuelan jurisdiction is allowed through the submission to foreign courts or arbitrators abroad without requiring any links with the country where the courts or arbitrators are seated, unless the controversy refers to (i) federal taxes on real property located in Venezuela; (ii) matters in which transactions are not possible; or (iii) affects fundamental principles of Venezuelan public policy.
Articles 48 and 52 regulate the internal territorial jurisdiction for cases in which Venezuelan courts have jurisdiction to hear cases with relevant foreign elements. However, Articles 48 and 51 do not overturn the regulations on international territorial jurisdiction which may correspond to other Venezuelan courts in accordance with other Venezuela laws (Article 52). Regarding the recognition and execution of foreign decisions, this has been reformed by eliminating the reciprocity requirement in Article 850 of the Civil Procedural Code (Article 53). The possibility of admitting partial efficacy of a foreign decision is expressly recognized (Article 54). Article 58 allows the same case to be pending in another international court, except for cases in which Venezuelan jurisdiction is exclusive. However, the usefulness of the preceding provision is thrown into question by Article 53(6) which states that a foreign decision can be effective in Venezuela only if no trial is pending in Venezuela courts on the same matter between the same parties and which was initiated before the foreign decision was issued.
The Law supersedes all previous provisions which regulate the same matter (Article 63). While not a complete list, the following are all superseded by the Law: Articles 9,10, 11,26 (in fine), 104,105,106,108, and 879 of theCivilCode; Articles 116,483,484, and 485 of the Commercial Code; and Articles 2, 4, 6,53,54,55,56,57,58,59 (first paragraph), 850, and 851 of the Civil Procedural Code. The Law came into effect on February 6, 1999 (Article 64). In accordance with Article 44 of the Venezuelan Constitution, legal rules are not retroactive. However, the immediate application of procedural rules is allowed, even in processes in progress. These rules will serve as guidelines to determine the application of the Law.
In general, the Law must be viewed in a positive light. It is now up to commentators and jurisprudence to bring the text of the Law to life. All who have participated in the preparation of the Law hope that the new provisions will take the future of the Venezuelan Private International Law down the right path.
Eugenio Hernández-Breton is an attorney with Baker & MacKenzie in Caracas, Venezuela.
