1 . 2 . M E T H O D S I N P R I V A T E I N T E R N A T I O N A L LAW

Before further analysing the (possible) impact of the economic freedoms on national

private international law, it is appropriate to point out that Member States do not

employ a single, uniform approach to private international law. Broadly speaking, two

approaches operate next to one another: the abstract and the substantive approach.

The use of these two approaches is roughly parallel to the private-public law divide:

since Von Savigny the abstract approach has formed the basic approach for private

law; for public law rules, however, the substantive approach dominates.

The abstract approach is characterised by the fact that the legal question or relationship

forms the starting-point of the conflicts analysis. The central objective is to allocate

a legal relationship or question to the legal system to which it belongs according to

its nature, its so-called 'Seat'. In the words of Von Savigny:

dais bei jedem Rechtsverhaltnis dasjenige Rechtsgebiet aufgesucht werde, welchem

dieses Rcchtverhaltnis seiner eigenthiunlichen Natur nach angehort oder unterworfen

ist.

The abstract approach operates through the use of connecting factors. By selecting

a specific element, the relationship or question is allocated to a particular legal system.

The abstract approach is therefore also multilateral: it not only determines the

applicability of a forum's own rules of law but also the applicability of foreign law. In

principle the abstract approach is considered to be 'blind' and 'neutral': neutral because

i t operates on a premise of equality of legal systems and has thus no preference lor one,

in particular its own, or the other system; blind because the allocation to a particular

legal system does not depend on the substance of that legal system and the substantive

outcome ol the case. '

The basis of the traditional Von Savignyan approach is to be found in a pre-positive

notion of l a w . " As an exponent ot the Historic School, Von Savigny considered the

real source of law to be the Volksgcist and not the nation-state. Law is not made but

found bv the legislator. Accordingly, legislation is 'merelv' declaratory ot law. It is this

negation of law as the expression of the sovereign state involving statal or political

concerns which has made the mutual inter-changeability of national legal rules

possible.

Von Savignv, Svftcm i / o heuliyen kiimi>chcn Hcclih. Vol. V I I I , 18-14. 2V.

Mrikwcrila. Inkiiling u>l het Xeikrahuke inlernulionanl prinuitnvlit, 200(1, 4K.

Sec generally, [oerges, Zmti hunktion^wtitulcl tic* k<'Hi<ien<recht, 19~1; Ponticr. ('onlhclcitrcJit)

".Savigny und das Internationales I'rivatrecht des 14. lahrhunclcrts". KcibchZ. 2001, 64.

Chapter lour. Community law and Private International Law I

Von SjAigny, System iA> heiiliyen Kominhai KechU, V I I I , 1849, 33: 'Ceset/e von strong positive!',

zwingender Natur, die elx'n wegen dieser Natur zu iener treien Behandlung, unabhangtg v im den

( i r a n / e n verschiedener Staaten, nieht geeignet sind'.

( i o n vent ion on the law applicable to contractual obligations, R o m e IV June 1980, ( > ! I W O / I . 266/1.

Article 3 and 4.

I'his also indicates why the abstract approach is generally incapable of accommodating

rules of a public law nature within its system. Rules of public law, better known as

'mandatory rules of law', luiigriffsiwrmen or loi< d'applicatum immediate, do not

conform to this p r e p o s i t i v e notion of law. Instead, strong public interests underlie

such rules ot law and states pursue specific goals by their application. Von Savigny

himself recognised the limits of the abstract, multilateral model and observed the

presence ot rules which, by virtue of their strictly positive and mandatory nature, could

not profit from mutual inter-changeability.'5 He regarded these rules not as 'law'

IRecht) but as elements which aim to realise values extraneous to law (auficrrechtlidi).

The applicability of mandatory rules of law is therefore typically not determined bv

means of abstract, blind and neutral rules. The applicability and international scope

of a national rule of mandatory law is determined by reference to its substance and

objectives. The point of departure of the conflicts analysis i s therefore not the 'nature'

of the legal relationship but the substance of the legal rule. Moreover, private

international law in respect of mandatory rules of law is predominantly of a unilateral

nature. States are concerned with the applicability of their own rules of law; foreign

mandatory rules of law are not generally taken into account.

The respective fields ot operation of the two methods (private v. public law) are however

not absolute. lust as the private-public law dichotomy cannot fully be maintained

in substantive law, neither can it in private international law. On the one hand, the

abstract approach takes more and more account of substantive interests and

consequently the conflicts outcome becomes less blind and neutral; while, on the other

hand, the substantive approach is showing signs of multilateralism. The Rome

Convention on the applicable law to contractual obligations illustrates the coexistence

ot the two conflicts methods.' The main rule provided by the (Ion volition is essentially

in line with the abstract method: in the absence of c h o i c e the contract will be governed

by the law of the country with which it is most closely c o n n e c t e d . 1 In respect of

consumer and employment contracts, however, the substantive interests of protecting

the weaker party to the contractual relationship have influenced the choice of law. On

the one hand, this interest is reflected in the selection of the objective connecting

factors (habitual residence of the consumer and place of habitually carrying out the

work respectively).'' These choice-of-law rules are still 'blind' and 'neutral'. T hey aim

not to refer to the law providing the highest level of protection but to the law that is,

irrespective of the substantive level of protection, the most appropriate one to provide

it. On the other hand, where parties make a choice of 'law, the protection under the

substantive law directly determines the applicable law. A choice is only effective to the

extent it is more favourable to the weaker party. The Convention departs from the

abstract methods entirely in respect of mandatory rules of law. The applicability of

these norms depends on their nature and purpose and the consequences of (non-1

application. This rule, however, also applies to the mandatory rules of law of another

country', introducing a degree of multilateralism."'