Skip to content What is the Rome I Regulation?
The EU Regulation 593/2008 (‘ROME 1’) establishes the law applicable to contractual obligations. In other words, it dictates which law applies to a contract. The freedom to choose and change the contract’s governing law is the basic rule (Article 3). The Regulation 593/2008 (ROME 1) determines this choice’s limits and the governing law in situations where the parties do not specify one.
What is a contract’s ‘governing law’?
Choosing a contract’s governing law means that the contract is under the jurisdiction of the country of choice. For example, if an employment contract is governed by Dutch Law, then Dutch Law applies to the contract, and its provisions cannot breach Dutch Law.
Effect of Rome I Regulation
EU Regulation 593/2008 entered into force in Member States’ legal systems on 17 December 2009. The Regulation affects decisions at the judicial level, when the judge must determine, during a dispute, which law applies.
How are national rights protected? – Articles 8 and 9
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Are the economic and social rights of an employee protected? – Article 8
Article 8 of Rome I Regulation on the individual employment contracts protects an employee’s economic and social rights. Therefore, the choice of law cannot deprive the employee from their rights which would be protected in the case of absence of a choice (Paragraph 1).
For example, a remote-work contract is explicitly governed under Dutch Law between a Dutch company and a France-based employee: The contract cannot deprive the France-based employee of its right to a maximum work hour of 35h/week compared to the Netherlands’ maximum of 60h/week. Indeed, the France-based employee would have enjoyed this right in the case of an absence of choice of law in the contract (Paragraph 1).
In the case of absence of choice, the contract is governed by the State where the work is habitually carried out (Paragraph 2).
If that is not possible, the contract is governed by where the place of business is situated (Paragraph 3). If it appears that the contract is more closely connected to another country, the law of that connected country applies (Paragraph 4).
For example: if a French company employs a Dutch person to physically deliver a service in Italy, the contract would fall under Italian law, where the service is delivered (Paragraph 2). If, instead, the service is not physical but a remote consultation, French law applies as this is where the place of business is situated (Paragraph 3). If this consultation has a close connection to the Netherlands, Dutch law shall apply to the contract.
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Is national public interest protected? – Article 9
Article 9 on the ‘overriding mandatory provisions’ causes the most important matters under the Regulation. Overriding mandatory provisions are laws considered crucial in a country to protect the public interest. Therefore, they must be applied to any situation falling within their scope. Contracts cannot breach them.
Article 9 thus limits the freedom of choice and safeguards the public interest of the country where the contract is performed (Paragraph 1).
The judge must give effect to those mandatory laws if the performance of the contract in the country according to the governing law is rendered unlawful by them (Paragraph 3).
Even the provisions of the Regulation itself cannot limit those overriding mandatory provisions (Paragraph 2).
For example, in practice, if a Dutch company employs a Belgian person to provide a service in France, the employee will enjoy the better protection of maximum working time (35h/week in France versus maximum 60h/week in the Netherlands) which is recognized as an ‘overriding mandatory provision’ in France.
What did the Court of Justice of the European Union decide on those matters?
The Court of Justice of the European Union (‘CJEU’) clarified some aspects of Articles 8 and 9. Those clarifications are good to consider when choosing the contract’s governing law, especially in cases of frequent mobility.
- C-384/2010 Voogsgeerd on Article 8(3): the place of business through which the employee was engaged is the entity that exercises employer authority, not simply the company named in the contract. This clarification reinforces the substance-over-form approach.
- C-29/10 Koelsch on Article 8(4): a habitual place of work means a real centre of working activity rather than relying on the mobility of the contracted workers/services.
- C-64/12 Schlecker on Article 8(4): Even when an employee works long-term in another country, courts must still assess whether the contract is more closely connected with another state. However, this exception must be applied restrictively. The provision is a safety valve rather than a loophole. Habitual place of work thus remains the primary rule.
- C-485/24 (Locatrans) on Article 8(4): In the case of a worker who worked for a certain time in one place and is called upon to take up his or her work activities in a different place, when determining the law which would be applicable in the absence of a choice made by the parties, account should be given to the entire employment relationship, and the most recent and intended habitual place of work.
- C-184/12 Unamar on Article 9(3): The use of Article 9(3) is restricted to limit its abuse. National Courts must write explicit reasons to use this provision and may use it only if:
- the legislature clearly intended the ‘overriding mandatory provisions’ to be fundamental;
- their application is proportionate; and
- non-application would seriously undermine public interests.
How do courts decide in different countries regarding EU Regulation 593/2008?
- France
French courts follow the jurisprudence of the CJEU on Article 8 strictly. Nonetheless, they used (less now after Unamar) Article 9(3) more liberally than its neighbouring Member States, in order to protect the employee according to French Worker Laws.
For example, According to the French Court de Cassation, Article L.442-1 (formerly L.442-6) of the Commercial Code is an overriding mandatory provision prohibiting restrictive business practices even if the contract’s law is otherwise chosen while the Netherlands refrains to do so.
- Netherlands
Dutch courts apply Article 8 more methodically but still following the logic of the CJEU. Contrary to French courts, Dutch courts treat Article 9(3) like an exceptional exception, requiring a strong connection to the territory, a serious risk for the public order of the other MS, and a detailed motivation. The courts thus use it very rarely.
- Italy
Concerning Article 8, Italy prioritizes a clear habitual place of work and seeks to protect the employees through the imperative content of its laws rather than over-interpretation.
On the other hand, Italian courts use Article 9 if the overriding mandatory provision protects a constitutional right and its immediate application is explicitly wanted. The use of the latter provision is thus rare but used efficiently.
- United Kingdom
After Brexit, the United Kingdom retained the Regulation as the domestic law ‘retained Regulation (EC) 593/2008’. While the law is still valid in the UK as legislature, the national courts may since depart from the CJEU’s reasonings.
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