Best Practices in Handling Foreign Law

Background

In a legal dispute, a German court must also decide on foreign law to the extent that it is relevant. This obligation arises from § 293 ZPO, according to which the court is not limited to the evidence presented by the parties but is rather authorized to use other sources of information and to order what is necessary for such use.

The court must ascertain foreign law on its own initiative. How the court acquires this knowledge is at its discretion. The principle of free proof applies, meaning the court may use all means of evidence and sources of information. The court may also obtain an expert opinion on foreign law. However, the expert's task is limited to answering the questions posed by the court concerning foreign law. The determination, interpretation, and application of international private law (IPR) applicable in Germany, as well as the decision of the specific case (i.e., fact-finding and subsumption) applying foreign law, remain original tasks of the court.

The court must discuss the application of foreign law with the parties (right to be heard) and give them the opportunity to present arguments about its determination and content. If the court has formed a preliminary opinion about the content of foreign law, for example, based on its own research, it communicates this to the parties (Hamburg Guidelines (2023), Art. 2 § 2 No. 2).

The parties to the legal dispute can assist the court in determining foreign law, but they are generally not obligated to do so beyond their general duty to assist in the process. Since foreign legal norms are treated as legal principles and not as facts, the principles of the burden of proof and presentation do not apply (Hamburg Guidelines (2023), Art. 1 § 1 No. 3, referring to BGH, Decision of 24.08.2022 - XII ZB 268/19). For tactical reasons, each party should still present arguments about foreign law. For these reasons alone, it is sensible to be represented in an international legal dispute by experienced, specialized lawyers who can conduct the legal dispute competently and convincingly to the court.

According to established case law of the BGH, foreign law is to be determined and applied by the competent court as it is or would be applied by the courts of the respective country (cf. BGH, Judgment of 05.07.2023 - IV ZR 375/21 para. 27).

While the BGH holds that the application of foreign law is not subject to appeal (referring to § 560 ZPO in conjunction with § 545 ZPO). The appellate court is generally bound by the findings of the lower court regarding the content of foreign law. In other words: German law is subject to appeal, foreign law is not. However, the determination of foreign law is indeed subject to highest court review (cf. BGH, Judgment of 05.07.2023 - IV ZR 375/21 para. 24).

Hamburg Guidelines

The "Hamburg Guidelines on the Determination and Application of Foreign Law in German Proceedings" (Hamburg Guidelines), developed in extensive exchange between practice and academia and published by the Max Planck Institute for Comparative and International Private Law in Hamburg, assist courts, experts, and parties (including their representatives) in dealing with foreign law in international legal disputes. They present the relevant legal framework in a concise form and offer numerous practical recommendations (Michaels/Schmidt, The Hamburg Guidelines on the Determination and Application of Foreign Law in German Proceedings, NJW 2024, 24 with further information on the background, contents, and outlook).

The Hamburg Guidelines are geared towards civil court proceedings but are also applicable in principle to other cases where German courts or authorities (e.g., tax courts, criminal courts, asylum authorities, tax authorities, registry offices) have to apply foreign law (Hamburg Guidelines (2023), Foreword).

The Hamburg Guidelines do not address the international jurisdiction of German courts because the courts must address this question based on the relevant legal sources (e.g., Brussels Ia Regulation, Brussels IIb Regulation, §§ 97 ff. FamFG) independently (Hamburg Guidelines (2023), Foreword).

Summary

To summarize, the Hamburg Guidelines are a useful tool for practical application.

The Hamburg Guidelines are licensed under the Creative Commons License CC-BY 4.0. The publisher is the Max Planck Institute for Comparative and International Private Law, Hamburg. The authors are Prof. Dr. Ralf Michaels and Priv.-Doz. Dr. Jan Peter Schmidt. The Hamburg Guidelines are available here.