The UK Government had opted out of the new rules but plans to
seek permission to become part of them again. Rome I governs whose
law applies in the case of a civil or commercial contractual
dispute.
Contracts are currently governed by the 1980 Rome Convention,
which does not harmonise actual contract law but does determine
which country's law applies in the case of a dispute between
parties in different nations.
Rome I is a proposed successor to that Convention, but in 2006
the UK opted out of it, saying that it affected consumer law too
greatly.
A new version of Rome I was proposed last year and the UK
Government has said that it will seek permission to opt back into
the agreement, though its consultation process on that opt in will
run until 25th June.
The European Parliament had made amendments to the Rome I
proposal, and now that these have been accepted by the Justice and
Home Affairs Council of the EU Council, the Rome I Regulation will
be implemented. It converts the Rome Convention into a European
Community Regulation.
The UK Government said after the publication of the more recent
version of Rome I that it more accurately reflected the content of
the Rome Convention, and that it therefore backed the
Regulation.
"Some of the benefits of the Rome I Regulation arise from its
structure as a Community instrument, rather than the specifics of
the text," said the Government's consultation paper, published in
April. "In conflict of laws issues, the widespread application of
similar rules can provide a benefit for those contracting across
borders. In particular, maintaining a single system prevents the
need for extensive legal advice."
"This benefit, presently provided by the Rome Convention, will
be lost if the UK does not opt in, as the Regulation will apply in
other Member States in any event. While the Convention and the
Regulation are similar in many respects, maintaining two separate
systems would increase complexity, especially for business," it
said.
The rules say that two parties can choose whose law governs a
contract. The Convention governs whose law applies in a dispute
over that contract if the parties have not previously agreed which
country's law to adhere to.
When that happens the law to be applied is that of the country
of the party to the contract whose service characterises the
contract.
Rome I differs slightly in that it gives courts the right to
enforce the law of the country "with which the situation has its
closest connection" even if the two parties have expressly chosen
another country's laws.
If the UK goes ahead and seeks to be included in Rome I it will
need the permission of the European Commission to opt back in.
Until then it will still be bound by the terms of the Rome
Convention.
