WIREDGOV

What happens to your house if you get divorced and your spouse is of another nationality? What happens to a joint bank account if the spouse dies? What happens in such cases if you and your spouse have the same nationality, but you have property or a bank account abroad? In Europe, there are around 16 million international couples, and at least 650,000 of them face these questions every year when their marriage or partnership comes to an end. Citizens lose time and money figuring out which law applies to their case and which court is competent to help them. Legal divergences between the 27 EU Member States create an incentive for "forum shopping" or a "rush to the court." This happens when one spouse – usually the wealthier one – rushes to a court where he/she thinks the outcome will be the most beneficial. The European Commission is therefore proposing EU-wide rules to bring legal clarity to the property rights for married international couples and for registered partnerships with an international dimension. The two proposed Regulations would help identify which law applies to a couple's property rights and the responsible court. The Regulations also provide for rules for recognising and enforcing court judgments on a couple's property in all EU Member States through a single procedure. The proposals are the first deliverable of the Commission's October 2010 Citizenship Report (IP/10/1390 and MEMO/10/525), which outlined 25 major practical obstacles that Europeans still face in their daily lives. Yesterday's proposals are the logical next step following the swift agreement last year on EU legislation to determine which country's rules apply in cross-border divorce cases (IP/10/347 and MEMO/10/695).

"The death of a spouse or a divorce is a harrowing time for anyone. Citizens should not be burdened even more by complicated administrative or legal procedures that cost time and money," said Vice-President Viviane Reding, the EU’s Justice Commissioner. "As more and more citizens fall in love and then marry or create partnerships across borders, we need clear rules to decide how joint property is divided in case of death or divorce. Today's proposals will help bring legal clarity and ease the complicated process of dividing up joint assets no matter where they are located in Europe. This is good news for international couples and good news for their bank accounts: the new rules can save around €400 million a year in extra costs."

Citizens expect a clear set of rules to know which court is competent to deal with their case and which law should apply to their assets. With today's proposals, the Commission wants to bring legal certainty to the daily lives of international couples. Following the new EU rules adopted last year – which allow international couples to decide which law applies to their divorce – the next step is now to clarify the rules covering the property rights of international couples.

The Commission is proposing two separate Regulations: one to implement the rules for married couples ("matrimonial property") and the other for registered partnerships ("patrimonial property"). Marriage is a legal institution recognised in all 27 EU Member States. In five countries, it is open to both opposite sex and same sex couples (the Netherlands since 2001; Belgium since 2003; Spain since 2005; Sweden since 2009 and Portugal since 2010). Registered partnerships are a more recent legal institution recognised in 14 EU Member States (Austria, Belgium, the Czech Republic, Denmark, Germany, Finland, France, Hungary, Ireland, Luxembourg, Netherlands, Slovenia, Sweden1 and the UK). While all 14 countries allow same sex couples to register partnerships, Belgium, France, Luxembourg and the Netherlands permit both same sex and opposite sex couples to register.

Both proposals presented today are gender neutral and neutral regarding sexual orientation. This means that, for example, a same sex marriage allowed under Portuguese law will be treated in the same way as an opposite sex marriage under the proposal dealing with matrimonial regimes At the same time, a heterosexual partnership can be registered in France under the same conditions as a same sex partnership and the registered partnerships proposal would apply to both situations.

Yesterday's proposals do not harmonise or change any of the substantive national law on marriage or registered partnerships. Instead, the proposals aim to make it easier for couples to settle property-related issues in case they move to another EU Member State or when they are from different countries and own assets abroad.

"We want to build bridges between Europe's different systems today to ease the daily lives of international couples, but our intention is not to create uniformity where social and legal traditions still vary widely and will continue to vary widely for the foreseeable future," said EU Justice Commissioner Reding when presenting the proposals in Brussels today. "Increasingly, registered partnerships are being introduced by national legislation. This is why the European Commission decided today not only to address the private international law aspects of international married couples, but also to enhance legal certainty to registered partnerships with an international dimension, with the first ever proposal for an EU regulation on registered partnerships."

The Commission's proposals will:

•Enable married international couples to choose the law that applies to their joint property in case of death or divorce;

•Enhance legal certainty for registered partnerships with an international dimension by submitting the assets of registered partnerships, as a rule, to the law of the country where the partnership was registered;

•Bring legal certainty for international couples (married or in registered partnerships) through a coherent set of rules to identify which country's court is responsible and which law will apply, based on a hierarchy of objective connecting factors;

•Increase predictability for international couples by smoothing out the process for recognising judgments, decisions and deeds throughout the EU. Couples will save time and money – an average of €2,000 to €3,000 per case. These savings are the result of citizens' ability to group several legal proceedings into one court action. For example, combining divorce or separation proceedings with proceedings on property issues in front of one single court.

Background

As more Europeans live outside their home country, there are currently around 16 million international couples in the EU. Out of the 2.4 million new marriages in 2007, 13% (310,000) had an international element. Similarly, 41,000 of the 211,000 registered partnerships in the EU in 2007 had an international dimension.

Many of these international couples have assets – such as property or a bank account – in more than one country. These couples face legal uncertainties and extra costs when dividing their property in cases of divorce, legal separation or death. At present, it is very difficult for international couples to know which courts have jurisdiction and which laws apply to their personal situation and their property. Rules vary greatly between countries and sometimes lead to conflicting situations. Parallel legal proceedings in different countries, complex cases and the resulting legal fees cost an estimated €1.1 billion a year. Around a third of these costs could be saved if today’s proposals were approved.

The plans require unanimous approval by the Council of Ministers and consultation by the European Parliament.

Further information

Homepage of Vice-President Viviane Reding, the EU’s Justice Commissioner:

http://ec.europa.eu/commission_2010-2014/reding/index_en.htm

ANNEX

1. International Marriages in the EU in 2007

2. International Divorces in the EU in 2007

3. Number of new Civil / Registered Partnerships by Year (Trends)

In 2007, 41,000 of the 211,000 registered partnerships in the EU had an international dimension. 8,500 international couples in registered partnerships were dissolved by separation and 1,266 were ended by the death of one of the partners.

When Sweden opened marriage for same-sex partners in May 2009, registered partnerships were abolished; they continue to exist if concluded before May 2009.