The Determination of Jurisdiction in Grid and Cloud Service Level Agreements GECON 2009, Delft, 24/8/09 Davide M. Parrilli

Business Experiments in GRID 2 Agenda Background; Research questions; Absence of choice B2B; Absence of choice B2C; Choice of court, written form B2B; Derogations B2C; Conclusions.

Business Experiments in GRID 3 Background Focus on the problems linked to the individuation of the court that is competent to judge and solve the disputes arising from an SLA between the provider and the client in a Grid/Cloud computing environment.

Business Experiments in GRID 4 Background Legal source: Regulation 44/2001. Scenarios: 1.Provision of Grid/Cloud computing and storage resources; 2.Supply of Grid/Cloud-based services (SaaS, etc). B2B and B2C.

Business Experiments in GRID 5 Background Dispute between the provider and the client: resolution before a judge (public authority): which court is competent if the issue has an international dimension?

Business Experiments in GRID 6 Research questions 1.If the parties did not state in the SLA which court is competent, how is it possible to find the competent court in B2B and B2C scenarios? 2.If the parties agreed on the competent court in the SLA, -In which form must the clause be drafted? -In case of B2C SLA, to what extent the clause is valid pursuant to the European laws?

Business Experiments in GRID 7 Absence of choice B2B The determination of competent court in the absence of choice in B2B SLAs. Problem: location of the principal place of business of the provider. Rule: the court of the place within the EU where, under the SLA, the services were provided or should have been provided. Very difficult to establish!

Business Experiments in GRID 8 Absence of choice B2B But: can an SLA be considered as a contract for the provision of services? No positive, active conduct by the provider (literature, case law ECJ). So: competence of the court of the place where the obligation has to be performed under the law governing the SLA (Rome Convention 1980): Law decided by the parties; Law of the country where the Grid/Cloud provider has its central administration.

Business Experiments in GRID 9 Absence of choice B2C The determination of competent court in the absence of choice in B2C SLAs The determination of competent court in the absence of choice in B2C SLAs: Who is consumer? Every physical person acting outside his trade or profession (no small businesses or professionals, even if they are “profane”). Special rules: protection for consumers if some conditions are met.

Business Experiments in GRID 10 Absence of choice B2C Conditions: special rules apply if the provider directs his activities to the Member State where the consumer is domiciled: not easy to establish! Criteria to take into account: Language of the website; Nature and characteristics of the website – active website; Disclaimers of the provider; Ways of payment, currencies/credit cards accepted; Etc.

Business Experiments in GRID 11 Absence of choice B2C Special rules: 1.Consumer acting as plaintiff 1.Consumer acting as plaintiff: competence of the court of the place where the consumer is domiciled OR where the provider is domiciled; 2.Provider acting as plaintiff 2.Provider acting as plaintiff: only the court of the place where the consumer is domiciled is competent.

Business Experiments in GRID 12 Absence of choice B2C These rules apply only if the defendant is domiciled in the EU (for companies, also if they have a branch, subsidiary or agent in the EU). Problem of the location of the consumer: German courts competent if a German tourist travels to Spain and buys services there?

Business Experiments in GRID 13 Choice of court, written form B2B Choice of court by the parties: the written form in B2B choice of court Choice of court by the parties: the written form in B2B choice of court: it must be in writing, or in a form agreed by the parties, or according to trade practices. And: any communication by electronic means with durable record is equivalent to writing. click-and-wrap Is click-and-wrap enough? Probably yes (it respects trade practices), but better delivery of the clause in pdf (via or direct download).

Business Experiments in GRID 14 Derogations B2C Intra-EU and extra-EU derogations in B2C Intra-EU and extra-EU derogations in B2C: allowed only if the agreement is entered into after the dispute has arisen (and in other cases). All other derogations are null and void, also if non-EU courts are selected. Invalidity of many commercial SLAs!

Business Experiments in GRID 15 Conclusions Issues of jurisdiction are important to build trust towards Grid/Cloud providers; Lack of protection for businesses-customers, more protection for consumers-customers; Potential problems of enforcement of decisions issued by the competent court, especially if the provider is established outside the EU: automatic recognition of decisions within the EU; Need to reconsider the position of SMEs: extend the definition of consumer?

THANK YOU Davide M. Parrilli ICRI – K.U. Leuven – IBBT © BEinGRID Consortium