2.4.1. Allocution of {Exclusive) Regulatory Jurisdiction

It has been argued that Alpine Investments not only raises the problem of conflicting

(exercise of) regulator}1 jurisdiction but also contains (the elements of) a solution to

such conflicts. In Alpine Investments the Dutch company had argued that the Dutch

measure was unnecessary and thus unlawful as the Netherlands ought to rely on the

law of the Member State of destination. The Court rejected this argument, observing

that

11 ] he Member State from which the telephone call is made is best placed to regulate

cold calling, kven if the receiving State wishes to prohibit cold calling or to makeit

subject to certain conditions, it is not in a position to prevent or control telephone

calls from another Member State without the cooperation of the competent

authorities of that State.1""

One interpretation suggested is that the Court has some sort of analysis at its disposal

by which, in case of conflict, regulatory jurisdiction can be allocated to the Member

State that is 'best placed' to regulate m a t t e r s . l N

This, it is submitted, is reading more into the judgment than is actually there. The

Court 'merely' held that in pursuing the protection of its own interests the Netherlands

were not bound to rely on the regulatory measures taken by the receiving Member

State, as it was 'best placed to regulate cold calling'. It did not however say that the

receiving Member State would not be allowed to pursue its own regulatory policy

regarding cold calling because it was 'worse placed'. Assume that an investor/consumer

had initiated proceedings before a court of t he receiving Member State seeking to have

his or her contract concluded in breach with the Dutch prohibition declared null and

void."''"' Would that court be precluded from applying its own, more permissive law? '"'

Or, conversely, assume that the Netherlands had not prohibited cold calling but had

opted for a (far) more permissive policy than the receiving Member State considers

appropriate in terms ofprotection ofits consumers. Would the receiving Member State

not be allowed to take protective measures, because it would be 'worse placed'? This

cannot be interred from the judgment.

The Court does not deny but in fact acknowledges that the receiving Member State

retains its regulatory jurisdiction with regard to the protection of the investor/consumer

residing in its territory. It is consistent case-law that in the absence of harmomsation

Mem her States remain competent to regulate matters in their territory.'"' The

Court confirms this principle, be it implicit!)', by observing that the protection of the

investor/consumer abroad is not as such a matter for the Netherlands to regulate; that

remains an interest for the other Member State.: " The legitimate interest the Netherlands

had in prohibiting cold calling was the reputation of its financial sector which,

as Advocate General Jacobs noted, existed 'independently of any interest of a receiving

Member State. 111

Neither did the Court conclude that the receiving Member State, even if i t would in

principle have jurisdiction, was precluded from exercising that jurisdiction because

the Netherlands was better placed to regulate cold calling. The Court did observe that

the receiving Member State could not prohibit or control cold calling without the c o operation

o f the Member State from which the telephone call i s made. However, this

does not mean that it was in fact unable to take any measures. On the one hand, the

Court arguably underestimates the receiving Member State's regulatory options. The

receiving Member State could effectively provide for any contract entered into by

making useot cold calling techniques to be null, avoidable or unenforceable whether

or not combined with liability for any loss suffered by the consumer.'"' On the other

hand, a mere need for co-operation does not by itself preclude a Member State from

exercising its regulatory jurisdiction. It should be recalled that in Centres the Court

Sector instance Case C I I3/S9 Rush I ' o r t u g u c v i , / • ( R 1990,1-1417; (:.ise ( . 43/93 Raymond Vandcr expressly allowed Denmark, as the State of secondary establishment (destination), to

take measures ' i f necessary with the co-operation of t he Member State ot incorporation'

(origin).'"" In other words, whether a Member State is in a position to take

effective measures or not must also be assessed in light of the assistance to be provided

in good faith by other Member States.

In any event, a criterion of the relative regulatory ability of Member States in terms

of prevention and control is open to criticism. That ability may be of little relevance

depending on the regulatory choices made, for instance a permissive policy. More importantly,

the fact that a Member State is better placed to prevent or control a certain

activity does not mean that that Member State is in the 'best' position to make

regulatory choices in substantive terms. It may easily fail to appreciate fully the interests

of the Member State where the measure is to take effect, risking either underor

overregulation.

By allowing the Netherlands to extend its measure to other Member States and simultaneously

confirming the territorial regulatory sovereignty of t he (receiving) Member

State, Alpine Investments creates the risk of the concurrent and conflicting exercise ol

regulatory jurisdiction and thus of a 'true' conflict of laws. The Court however offers

no mechanism to resolve such a conflict. Nonetheless, as will be shown below, Member

States are not entirely free under Community law in these instances.