1 BY AN ORDER OF 21 MARCH 1980 WHICH AS RECEIVED AT THE COURT ON 11 JUNE 1980 THE BUNDESGERICHTSHOF ( FEDERAL COURT OF JUSTICE ) REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER THE PROTOCOL OF 3 JUNE 1971 ON THE INTERPRETATION BY THE COURT OF JUSTICE OF THE CONVENTION OF 27 SEPTEMBER 1968 ON JURISDICTION AND THE ENFORCEMENT OF JUDGMENTS IN CIVIL AND COMMERCIAL MATTERS ( HEREINAFTER REFERRED TO AS ' ' THE CONVENTION ' ' ) TWO QUESTIONS CONCERNING THE INTERPRETATION OF ARTICLE 5 ( 5 ) OF THAT CONVENTION .
2 ACCORDING TO THAT PROVISION , WHICH DEROGATES FROM THE GENERAL RULE OF FORUM DOMICILII SET OUT IN ARTICLE 2 OF THE CONVENTION , A DEFENDANT DOMICILED IN A CONTRACTING STATE MAY BE SUED IN ANOTHER CONTRACTING STATE ' ' AS REGARDS A DISPUTE ARISING OUT OF THE OPERATIONS OF A BRANCH , AGENCY OR OTHER ESTABLISHMENT , IN THE COURTS OF THE PLACE IN WHICH THE BRANCH , AGENCY OR OTHER ESTABLISHMENT IS SITUATED ' ' .
3 BLANCKAERT & WILLEMS , A BELGIAN FURNITURE MANUFACTURER AND THE DEFENDANT IN THE MAIN ACTION ( HEREINAFTER REFERRED TO AS ' ' BLANCKAERT ' ' ) HAS ACCORDING TO ITS OWN STATEMENTS HAD A BUSINESS ASSOCIATION SINCE 1960 WITH THE GERMAN UNDERTAKING HERMANN BEY ( HEREINAFTER REFERRED TO AS ' ' BEY ' ' ), A FURNITURE AGENCY ( MOBELAGENTUR ), WHICH IT MADE RESPONSIBLE FOR THE ESTABLISHMENT IN THE FEDERAL REPUBLIC OF GERMANY OF A SALES NETWORK FOR THE FURNITURE WHICH BLANCKAERT MANUFACTURED . IN PERFORMANCE OF THAT OBLIGATION BEY , ACTING ON BEHALF OF BLANCKAERT , ENTERED INTO A COMMERCIAL AGENCY WITH TROST , THE PLAINTIFF IN THE MAIN ACTION , FOR THE RHINE AND RUHR , EIFEL AND SOUTH WESTPHALIA AREA . UNDER THE TERMS OF THAT CONTRACT TROST WAS TO WORK AS THE DIRECT REPRESENTATIVE OF BLANCKAERT AND RECEIVE FROM THE LATTER A COMMISSION OF 5 % . THE CONTRACT STIPULATED THAT TROST WAS TO TRANSMIT THE ORDERS SHE OBTAINED FOR BLANCKAERT THROUGH BEY AT AACHEN . ON ANY SUCH ORDERS TRANSMITTED TO IT THROUGH BEY BLANCKAERT WOULD PAY THE LATTER THE EXTRA COMMISSION CUSTOMARILY GIVEN TO COMMERCIAL AGENTS WHO ARE RESPONSIBLE FOR SUPERVISING OTHER COMMERICAL AGENTS OF AN UNDERTAKING .
4 IN DECEMBER 1976 BLANCKAERT TERMINATED ITS CONTRACT WITH TROST , LEADING TO AN ACTION BY THE LATTER FOR PAYMENT OF COMMISSION AND AGENT ' S ADJUSTMENT FEES . TROST BROUGHT THE ACTION BEFORE THE LANDGERICHT ( REGIONAL COURT ) AACHEN , ON THE GROUND THAT BEY WAS AN AGENCY OR BRANCH OF BLANCKAERT AND THEREFORE THE DISPUTE COULD BE BROUGHT BEFORE THE COURT OF THE PLACE IN WHICH THAT AGENCY OR BRANCH WAS ESTABLISHED .
5 THE LANDGERICHT AACHEN DID NOT ACCEPT THAT VIEW AND DECLINED JURISDICTION BUT THE OBERLANDESGERICHT KOLN ( HIGHER REGIONAL COURT , COLOGNE ), HEARING THE APPEAL , HELD THAT THE CONDITIONS FOR THE INTERNATIONAL JURISDICTION OF THE LANDGERICHT AACHEN WERE FULFILLED BECAUSE BEY WAS AN AGENCY OF BLANCKAERT ' S WITHIN THE MEANING OF ARTICLE 5 OF THE CONVENTION AND BECAUSE THE AMOUNTS CLAIMED WERE ATTRIBUTABLE TO THE OPERATION OF THAT AGENCY .
6 HEARING THE APPEAL ON A POINT OF LAW THE BUNDESGERICHTSHOF HELD THAT THE OBERLANDESGERICHT KOLN HAD RIGHTLY ESTABLISHED THAT BOTH BEY AND TROST HAD WORKED FOR BLANCKAERT ' ' AS A COMMERCIAL AGENT ( HANDELSVERTRETER ) AND MORE SPECIFICALLY AS A BUSINESS NEGOTIATOR ( VERMITTLUNGSVERTRETER ), THAT IS TO SAY , BOTH WERE CHARGED ON A PERMANENT BASIS WITH NEGOTIATING BUSINESS ON BEHALF OF AN UNDERTAKING , NAMELY THE DEFENDANT , AS INDEPENDENT BUSINESSMEN WITHIN THE MEANING OF THE FIRST PARAGRAPH IN ARTICLE 84 OF THE GERMAN COMMERCIAL CODE ( HANDELSGESETZBUCH ) ' ' , AND RULED THAT THE QUESTION WHETHER THE OPERATIONS OF AN AGENCY OR OTHER ESTABLISHMENT WITHIN THE MEANING OF ARTICLE 5 ( 5 ) OF THE CONVENTION INCLUDE THE ACTIVITIES OF A COMMERCIAL AGENT , AND MORE PARTICULARLY THOSE OF A BUSINESS NEGOTIATOR WITHIN THE MEANING OF THE ABOVE-QUOTED PROVISION OF GERMAN LAW , HAD YET TO BE DECIDED BY THE COURT OF JUSTICE .
7 CONSIDERING THEREFORE THAT THE DISPUTE RAISED QUESTIONS CONCERNING THE INTERPRETATION OF THE CONVENTION THE BUNDESGERICHTSHOF REFERRED TWO QUESTIONS TO THE COURT OF JUSTICE FOR A PRELIMINARY RULING ON THE INTERPRETATION OF ARTICLE 5 ( 5 ) OF THAT CONVENTION .
FIRST QUESTION
8 THE FIRST QUESTION ASKS IN SUBSTANCE WHETHER A COMMERCIAL AGENT ( HANDELSVERTRETER ) WHO IS A BUSINESS NEGOTIATOR ( VERMITTLUNGSVERTRETER ) WITHIN THE MEANING OF ARTICLE 84 ET SEQ . OF THE GERMAN COMMERCIAL CODE IS TO BE CONSIDERED AS AN ' ' AGENCY ' ' OR ' ' OTHER ESTABLISHMENT ' ' WITHIN THE MEANING OF ARTICLE 5 ( 5 ) OF THE CONVENTION .
9 AS THE NATIONAL COURT CORRECTLY OBSERVES , THE COURT STATED IN ITS JUDGMENT OF 6 OCTOBER 1976 ( CASE 14/76 DE BLOOS V BOUYER ( 1976 ) ECR 1497 ) THAT ONE OF THE ESSENTIAL CHARACTERISTICS OF THE CONCEPT OF A BRANCH OR AGENCY IS THE FACT OF BEING SUBJECT OF THE DIRECTION AND CONTROL OF THE PARENT BODY .
10 THE COURT DID NOT HAVE OCCASION IN THAT DECISION TO IDENTIFY THE FACTORS ENABLING IT TO BE DETERMINED WHETHER OR NOT AN UNDERTAKING OR OTHER BUSINESS CONCERN IS SUBJECT TO THE DIRECTION AND CONTROL OF A PARENT BODY , BECAUSE THE MAIN DISPUTE CONCERNED THE RELATIONSHIP BETWEEN THE GRANTOR AND THE GRANTEE OF AN EXCLUSIVE SALES CONCESSION , AND THE NATIONAL COURT HAD STATED THAT THE GRANTEE WAS NOT SUBJECT TO EITHER THE DIRECTION OR THE CONTROL OF THE GRANTOR .
11 FURTHERMORE , IN ITS JUDGMENT OF 22 NOVEMBER 1978 ( CASE 33/78 SOMAFER ( 1978 ) ECR 2183 ), THE COURT STATED THAT ' ' THE CONCEPT OF A BRANCH , AGENCY OR OTHER ESTABLISHMENT IMPLIES A PLACE OF BUSINESS WHICH HAS THE APPEARANCE OF PERMANENCY , SUCH AS THE EXTENSION OF A PARENT BODY , HAS A MANAGEMENT AND IS MATERIALLY EQUIPPED TO NEGOTIATE BUSINESS WITH THIRD PARTIES SO THAT THE LATTER , ALTHOUGH KNOWING THAT THERE WILL IF NECESSARY BE A LEGAL LINK WITH THE PARENT BODY , THE HEAD OFFICE OF WHICH IS ABROAD , DO NOT HAVE TO DEAL DIRECTLY WITH SUCH PARENT BODY BUT MAY TRANSACT BUSINESS AT THE PLACE OF BUSINESS CONSTITUTING THE EXTENSION ' ' .
12 FROM THE GROUNDS GIVEN IN THOSE TWO JUDGMENTS , AND ESPECIALLY FROM THE RULE THAT A ' ' BRANCH , AGENCY OR OTHER ESTABLISHMENT ' ' WITHIN THE MEANING OF ARTICLE 5 ( 5 ) MUST APPEAR TO THIRD PARTIES AS AN EASILY DISCERNIBLE EXTENSION OF THE PARENT BODY , IT IS CLEAR THAT THE DEPENDENCY ON THE DIRECTION AND CONTROL OF THAT PARENT BODY IS NOT ESTABLISHED WHEN THE REPRESENTATIVE OF THE PARENT BODY IS ' ' BASICALLY FREE TO ORGANIZE HIS OWN WORK AND HOURS OF WORK ' ' ( ARTICLE 84 ( 1 ), LAST SENTENCE , OF THE GERMAN COMMERCIAL CODE ) WITHOUT BEING SUBJECT TO INSTRUCTIONS FROM THE PARENT BODY IN THAT REGARD ; WHEN HE IS FREE TO REPRESENT AT THE SAME TIME SEVERAL RIVAL FIRMS PRODUCING OR MARKETING IDENTICAL OR SIMILAR PRODUCTS AND , LASTLY , WHEN HE DOES NOT EFFECTIVELY PARTICIPATE IN THE COMPLETION AND EXECUTION OF TRANSACTIONS BUT IS RESTRICTED IN PRINCIPLE TO TRANSMITTING ORDERS TO THE UNDERTAKING HE REPRESENTS . THOSE THREE FACTORS PRECLUDE A CONCERN HAVING ALL THOSE CHARACTERISTICS FROM BEING CONSIDERED AS THE PLACE OF BUSINESS HAVING THE APPEARANCE OF PERMANENCY AS AN EXTENSION OF THE PARENT BODY .
13 THE REPLY TO THE FIRST QUESTION MUST THEREFORE BE THAT AN INDEPENDENT COMMERCIAL AGENT WHO MERELY NEGOTIATES BUSINESS ( HANDELSVERTRETER ( VERMITTLUNGSVERTRETER )), INASMUCH AS HIS LEGAL STATUS LEAVES HIM BASICALLY FREE TO ARRANGE HIS OWN WORK AND DECIDE WHAT PROPORTION OF HIS TIME TO DEVOTE TO THE INTERESTS OF THE UNDERTAKING WHICH HE AGREES TO REPRESENT AND WHOM THAT UNDERTAKING MAY NOT PREVENT FROM REPRESENTING AT THE SAME TIME SEVERAL FIRMS COMPETING IN THE SAME MANUFACTURING OR MARKETING SECTOR , AND WHO , MOREOVER , MERELY TRANSMITS ORDERS TO THE PARENT UNDERTAKING WITHOUT BEING INVOLVED IN EITHER THEIR TERMS OR THEIR EXECUTION , DOES NOT HAVE THE CHARACTER OF A BRANCH , AGENCY OR OTHER ESTABLISHMENT WITHIN THE MEANING OF ARTICLE 5 ( 5 ) OF THE CONVENTION .
SECOND QUESTION
14 THE SECOND QUESTION IS ASKED ONLY IF THE REPLY TO THE FIRST QUESTION SHOULD BE IN THE AFFIRMATIVE . A REPLY TO IT IS THEREFORE NOT REQUIRED .
15 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES WHICH HAS SUBMITTED OBSERVATIONS TO THE COURT ARE NOT RECOVERABLE . AS THE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED , IN THE NATURE OF A STEP IN THE PROCEEDINGS BEFORE THE NATIONAL COURT , THE DECISION ON COSTS IS A MATTER FOR THAT COURT .
ON THOSE GROUNDS ,
THE COURT ( THIRD CHAMBER )
IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE BUNDESGERICHTSHOF BY AN ORDER OF 21 MARCH 1980 HEREBY RULES :
AN INDEPENDENT COMMERCIAL AGENT WHO MERELY NEGOTIATES BUSINESS ( HANDELSVERTRETER ( VERMITTLUNGSVERTRETER )), INASMUCH AS HIS LEGAL STATUS LEAVES HIM BASICALLY FREE TO ARRANGE HIS OWN WORK AND DECIDE WHAT PROPORTION OF HIS TIME TO DEVOTE TO THE INTERESTS OF THE UNDERTAKING WHICH HE AGREES TO REPRESENT AND WHOM THAT UNDERTAKING MAY NOT PREVENT FROM REPRESENTING AT THE SAME TIME SEVERAL FIRMS COMPETING IN THE SAME MANUFACTURING OR MARKETING SECTOR , AND WHO , MOREOVER , MERELY TRANSMITS ORDERS TO THE PARENT UNDERTAKING WITHOUT BEING INVOLVED IN EITHER THEIR TERMS OR THEIR EXECUTION , DOES NOT HAVE THE CHARACTER OF A BRANCH , AGENCY OR OTHER ESTABLISHMENT WITHIN THE MEANING OF ARTICLE 5 ( 5 ) OF THE CONVENTION OF 27 SEPTEMBER 1968 ON JURISDICTION AND THE ENFORCEMENT OF JUDGMENTS IN CIVIL AND COMMERCIAL MATTERS .
