Neutral Citation Number: [
 2014]
  
EWCA
  
Civ
  
1130 
  Case No: B3/2013/2808/QBEN F 
IN THE COURT OF APPEAL (
 CIVIL
  DIVISION)  
ON APPEAL FROM QUEEN'S BENCH DIVISION  
MR JUSTICE ANDREW SMIT H 
[2013] EWHC 2131 (QB)   
 
  Royal Courts of Justice  
Strand, London, WC2A 2L L 
  31/07/
 2014 
B e f o r e :  
MASTER OF THE ROLLS  
LORD JUSTICE AIKENS  
and 
DAME JANET SMIT H 
____________________  
Between:  
 
 Young  Appellant  
 - and -  
 Anglo American South Africa Limited & 
Ors Respondent  
____________________  
Mr Alex Layton QC & Mr Sudhanshu Swaroop (instructed by Leigh Day) for 
the Appellant  
Mr Guy Philipps QC & Stephen Midwinter (instructed by Reynolds Porter 
Chamberlain LLP) for the First Respondent  
Mr Howard Palmer QC (instructed by George Dodd of Medical Protection 
Society) f or the Second Respondent  
Hearing date : 25/03/
 2014
   
____________________  
HTML VERSION OF JUDGMENT
 
____________________  
Crown Copyright ©  
Lord Justice Aikens :   
I. Synopsis.  
1. The question that arises on this appeal is whet her there is a "good arguable 
case"[1] that Anglo American South Africa Limited ("AASA"),  a South 
African company, had its "central administration" in England for the purposes 
of Article 60 of the Brussels 1 Regulation (Regulation EC 44/2001 – "the 
Regulation") when the current proceedings were issued on 25 August 2011. If 
that were so then in  the current proceedings AASA could be sued in England 
pursuant to Article 2 of the Regulation,[2] and therefore the proceedings could 
be served on AASA in South Africa without the leave of the court pursuant to 
CPR Pt 6.33(1).  Andrew Smith J held that there was no such "good arguable 
case". He had to deal with two sets of proceedings, but bef ore the Court of 
Appeal there was an appeal in only one, that of Jessica Margaret Young, 
acting by her father and litigation friend, Kenneth Niall Young. The claim is 
against AASA and Dr Peter Jankowitz ("the Young action"). If the judge was 
wrong it would  mean that Miss Young can bring an action for damages against 
AASA for alleged medical negligence of various doctors who managed her 
neo-natal care for whom it is alleged AASA is vicariously liable; and she 
could also bring an action against Dr Jankowitz, the second defendant. At the 
relevant time Dr Jankowitz was a paediatrician in independent private practice 
in Johannesburg, South Africa, although he was not then a consultant. Miss 
Young was referred to him early in her life and it is said that Dr Jankow itz was 
negligent in the conduct of those consultations.  
2. Miss Young was born on 30 August 1990 at the Jwaneng Mine Hospital in 
Botswana. She suffered from Phenylketonuria ("PKU"). It is said that four 
doctors, who worked in the hospital where Miss Young w as born and who are 
defendants in the Young action but who have not been served with the 
proceedings, did not guard against, detect or diagnose the PKU. AASA has 
accepted that it is vicariously liable for the acts and omissions of those doctors 
insofar as they amounted to a breach of duty. AASA itself is also alleged to 
have been directly responsible for Miss Young's current condition because it 
failed to have a system at the Jwaneng Mine for routine screening of babies for 
PKU, as is done in both the UK an d the USA.  
3. Miss Young was referred to Dr Jankowitz in Johannesburg and was seen by 
him on 7 February 1991. It is alleged that Dr Jankowitz, in breach of duty, 
failed to detect or diagnose that Miss Young was or might be suffering from 
PKU. Dr Jankowitz sa w Miss Young again in June 1991. On that occasion he 
considered there was a problem which needed to be referred to a consultant 
paediatrician in South Africa and that was done.  
4. The current proceedings were served on AASA at its registered office in 
Johann esburg on 15 December 2011 without the leave of the court. The 
claimant asserted that AASA had its "central administration" in England, so 
that it was "domiciled" in England for the purposes of Article 60 of the 
Regulation. AASA acknowledged service and th en on 20 January 2012 
applied under CPR Pt 11.1 for a declaration that the English court had no 
jurisdiction to hear the claim on the basis that AASA was not domiciled in 
England.  
5. Article 60 of the Regulation provides:  
"1. For the purpose of this Regulation, a company or other legal person or 
association of natural or legal persons is domiciled at the place where it has 
its:  
(a) statutory seat; or  
(b) central administration; or  
(c) principal place of business.  
2. For the  purposes of the United Kingdom and Ireland, "statutory seat" means 
the registered office or, where there is no such office anywhere, the place of 
incorporation or, where there is no such place anywhere, the place under the 
law of which the formation took place".  
6. The claimants have always accepted that AASA's "statutory seat" was not in 
England. Before Andrew Smith J they also accepted that England was not its 
"principal place of business". So the only way by which it could be established 
that AASA was dom iciled in England at the relevant time was if the claimants 
could show that there was a "good arguable case" that its "central 
administration" was in England.  
7. Dr Jankowitz emigrated from South Africa to New Zealand in 1994 and he 
continued to live there. On 12 January 2012 the claimant applied to the 
Master, without notice, for permission to serve Dr Jankowitz with the 
proceedings in the Young action, relying on CPR 6BPD 3.1(3). This provides, 
in short, that if a claim form has been served on another defen dant and there is 
between the claimant and that defendant "a real issue which it is reasonable for 
the court to try", then proceedings may be served upon another person, (in this 
case Dr Jankowitz) who is "a necessary or proper party to that claim". The 
Master made his order on 9 February 2012 and Dr Jankowitz was served on 22 
February 2012. On 29 March 2012 he applied, under CPR Pt 11.1, to set aside 
the Master's order for service. On behalf of Dr Jankowitz it is accepted that 
there is a "real issue which it is reasonable for the court to try" as between 
Miss Young and AASA. So the issue of whether Dr Jankowitz was properly 
served depends entirely on whether AASA has itself been properly served, 
which in turn depends on the issue of whether there is a "good  arguable case" 
that AASA had its "central administration" in England as at 25 August 2011, 
ie. when the proceedings in the Young action were issued.  
8. The claimants in both sets of proceedings applied to the court for specific 
disclosure on the issue of wh ether AASA was domiciled in England. After a 
contested hearing before Silber J, he ordered extensive disclosure on 16 July 
2012. In his judgment, Silber J concluded that the claimants did not even have 
an arguable case that AASA had its "principal place of  business" in England 
and that basis for founding jurisdiction under the Regulation was therefore not 
pursued.  
9. Andrew Smith J heard the applications of AASA for a declaration that the 
English court did not have jurisdiction to hear the claims in the two a ctions on 
1 and 2 May 2013. He handed down judgment on 24 July 2013. By his order 
of the same date the judge declared that the English court had no jurisdiction 
to try either action before him and he set aside the claim form against AASA 
and Dr Jankowitz a nd set aside the order permitting service of the proceedings 
in the Young action against Dr Jankowitz in New Zealand.  
10. The judge gave limited permission to appeal but that was enlarged by Lewison 
LJ in an order made on 13 November 2013 following an applica tion on paper.  
II. The findings of fact of Andrew Smith J.  
11. In order for Andrew Smith J to be able to reach a conclusion on whether there 
was a "good arguable case" that the "central administration" of AASA was 
situated in London as at 25 August 2011, he h ad to make detailed findings of 
fact about the corporate nature of AASA, how it was run and how it fitted in to 
the corporate structure of the group to which AASA belonged, which was and 
is the Anglo -American group, ("the Group"). Andrew Smith J did so par tly by 
reference to conclusions on facts that Silber J had reached in his judgment on 
the application for specific discovery made by the claimants in the two actions 
for the purposes of the jurisdiction issue, and partly by reference to all the 
further evi dence which was before him (Andrew Smith J) on the applications 
before him on the jurisdiction issues.  
12. The "head" company of the Group is Anglo -American PLC (AA), an English 
company incorporated in 1999 with its head office in London and its shares 
listed  principally on the London Stock Exchange. AA was incorporated when 
the businesses of AASA and Minorco SA, a Luxembourg company with 
interests in mining companies outside South Africa, were brought together. 
The London head office of AA has hundreds of sta ff members who are 
engaged in issues of administration and finance, engineering and geology and 
"Group policies". AA has two important committees; one is the Group 
Management Committee ("GMC") and the other is the Executive Committee 
("Exco"). The judge fo und that when AA was incorporated "…AASA stopped 
providing services to other companies and that role was taken over by [Anglo 
Operations Limited – AOL] a company incorporated in South Africa as a 
wholly -owned subsidiary of AASA".[3]  
13. As for the structure of the Group overall as at August 2011, there was and is 
no dispute about it and it was se t out in diagrammatic form in the outline 
argument of Mr Alex Layton QC, who represented Miss Young on the appeal. 
AA at the head of the Group wholly owns Anglo -American Holdings Limited 
(UK), which in turn wholly owns Anglo -American International SA 
(Luxe mbourg), which wholly owns AASA. Thus AA is not directly a 
shareholder in AASA; the Luxembourg entity is. The judge found that AASA 
itself was founded in South Africa in 1917 to develop gold mining in the East 
Rand and became South Africa's leading mining finance house. It is 
incorporated there and it has its registered office in Johannesburg. AASA in 
turn wholly owns two companies, Anglo Operations Limited, which is 
incorporated in South Africa, and Anglo American South Africa Capital (Pty) 
Limited. AOL in  turn wholly owns Anglo Coal Limited, ("Anglo Coal") and 
Anglo American Africa Capital (Pty) Limited. That last company in turn owns 
79.2% of the capital in Anglo Platinum Limited ("Amplats") and 62.54% of 
the capital in Kumba Iron Ore Limited ("Kumba"). A nglo Coal, Amplats and 
Kumba are all mine operating companies in South Africa.  
14. The judge considered the role of AA and its two committees, the GMC and 
Exco. He noted that the GMC had delegated to it wide powers of the board of 
AA, save on certain matters;  in particular, the authority to make capital 
investments over US$250 million remained reserved to the AA board. Under 
the Group's "Investment Evaluation Guidelines" individual Group companies 
could only make capital investments on their own initiative up to US$ 10 
million; investments between US$10 and 100 million required the 
authorisation of AA's Investment Committee and investments between 
US$100 and US$250 million required the authorisation of the GMC. Above 
US$250 million authorisation of the AA board  had to be given.[4]  
15. The judge found that all of the Group's assets in South Africa were held 
through AASA and, during the years 2008 to 2011, AASA held a sizeable 
proportion of the total gross assets of the Group. In a press release in April 
2010 the Group said that 40% of its operating assets were in South Africa.[5] 
The judge further found that AASA not only had an interest in other mining 
companies in the Group but also provided administrative, financial, technical 
and engineering services to other Group operating companies through service 
contracts. AASA did not operate mines itself. But the judge accepted the 
evidence given in a witness statement o f Mr Christopher Griffiths, who had 
been a director of AASA since 27 May 2010, that AASA "…did not exercise 
management of the operating mining companies in which it had interests; 
those companies had their own boards and made their own corporate 
decisions" .[6] The judge found that AASA had no employees and did not 
conduct any business of its o wn.[7] He accepted Mr Griffiths' evidence that 
AASA's "vestigial business" was that of ho lding various shareholdings in 
predominantly South African companies and in guaranteeing certain financial 
obligations of those companies. That was done principally in South Africa.[8]  
16. Mr Godfrey Gomwe, a Zimbabwean citizen who lives in South Africa, has 
been a director of AASA since 2001, was appointed Executive Director of 
AASA in 2009 and remained so in 2011. He was a member of AA's Exco. 
AASA had a designated "leadership team" which comprised Mr Gomwe, Mr 
Christopher Griffiths, who was not only a director of AASA but also the CEO 
of Kumb a, and Mr Norman Mbazima, who is a director of AASA and also 
CEO of another subsidiary company in the Group called Thermal Coal, whose 
operations are also principally in South Africa. The members of the AASA 
"Leadership Team" reported to Ms Cynthia Carroll , who was at the relevant 
time the CEO of AA and was based in London.[9] The judge consid ered that 
the fact that these AASA directors reported to Ms Carroll was not "an 
important indicator" of where AASA had its central administration. He held:  
"It is unsurprising given their other roles that they should have reported to Ms 
Carroll and unrema rkable that the Group should arrange a reporting line 
between [AA] and important subsidiaries: it does not indicate either that the 
subsidiary's central administration is done by the parent or that it is done 
where reporting takes place".[10] 
17. The judge found that between September 2010 and October 2011 AASA had 
only three board meetings: on 6  and 23 September 2010 and on 18 April 2011. 
The meeting on 6 September was held specifically to approve an interim 
report on the six months to 30 June 2010 because approval was required by the 
South Africa Reserve Bank. The judge recorded the following im portant 
statement, at [34] of his judgment:  
"I also accept, and [counsel for AASA] did not dispute, that [AA] is concerned 
that decisions about AASA's holdings and the Group's South African assets 
should be taken in accordance with the Group's policies an d strategies that it 
has determined and in accordance with its wishes".  
18. The judge noted not only that AASA board meetings were infrequent but also 
that between September 2010 and October 2011 Mr Medori, a director, did not 
attend a board meeting at all an d that other board members missed meetings. 
The judge further noted that the attendance of the "Leadership Team" was 
limited. But he concluded that these facts were not significant, and he was not 
able to regard them "as an indication that the board meetin gs of AASA were 
unimportant or that they were so regarded by its members or AASA".[11] He 
accepted that the detailed evidence of the AASA witnesses demonstrated that 
the board meetings were sufficient for AASA's limited business. AASA's role 
in the Group and the nature of its business did not call for either frequent or 
lengthy board meetings .[12] Furthermore, although no decision to enter into an 
acquisition or a disposal appea red in AASA's board minutes for recent years, 
the judge accepted the evidence of Mr Griffiths, director of AASA, that this 
was because AASA had not, itself, engaged in such activity; it had been done 
by AASA's own subsidiaries and so the decisions were mad e by their 
boards.[13]  
19. The judge found that AASA appointed its own auditors in accordan ce with the 
requirements of the South African Companies Act 2008.[14] He found that 
AASA  and its subsidiaries remained responsible for decisions about tax and if 
AASA or one of its subsidiaries required "tax advice or support", it looked to a 
department called "Group Tax" in South Africa (in a department of AOL), 
who might in turn look elsewh ere for further advice if needs be.[15] 
Furthermore, decisions about dividends were made  by the board of AASA or 
any subsidiary declaring a dividend, even if advice might be sought from 
Group Tax.[16] "Secondary management"[17] services that AASA required were 
provided by employees of AOL based in South Africa. This was done under a 
Master Services Agreement of 4 April 2011.[18] Thus, the judge accepted that, 
overall, the role of AASA included: (i) monitoring and reviewing the activities 
of subsidiaries; (ii) guaranteeing loans and providing other financial support to 
subsidiaries; (iii) charitable wo rks; and (iv) ancillary business functions such 
as appointing directors and auditors, setting budgets and dividends, defending 
litigation and managing business risks.[19]  
20. In respect of the relationship between AA and AASA, the judge concluded 
that there was no evidence, from what Mr Gomwe had said or elsewhere, that 
AA did more than "influen ce" decisions of AASA, "no doubt powerfully…", 
as opposed to AA "determining" AASA's decisions.[20] As for the role of Mr 
Gomwe himself, when he was appointed Executive Director of AASA in 
December 2009 his job description stated that the purpose of his appointment 
was "to be [AA's] chief representative in South Africa working together with 
Anglo American's Business Unit CEOs to deliver the Group strategy in the 
region". Mr Gomwe was a "frequent visitor" to London.[21] His position as 
Executive Director of AASA was only a part of his job. However, the judge 
concluded that:  
"..the fact [of Mr Gomwe's] other roles [does not mean] that, where he 
undertakes activities for AASA and p articipates in decisions of AASA, AASA 
is not acting as a distinct company or that it is acting under the control of 
another entity in the Group, still less that its activities are undertaken 
elsewhere than in South Africa".[22] 
Therefore, the fact that Mr Gomwe had a dual role was "no indication of 
where AASA had its central administration".[23] However, in stating his 
conclusions, the judge did note that Mr Guy Philipps QC, co unsel for AASA, 
"did not dispute" that AASA would not make an important decision such as, 
for example, to dispose of shares in a subsidiary company such as AOL, 
"otherwise than in accordance with [AA's] wishes".  
III. The conclusions of Andrew Smith J on t he legal issues and overall.  
21. First, the judge held that the claimant had to establish that there was a "good 
arguable case" that the "central administration" of AASA was in a Member 
State of the EU in order to fall within Article 60(1)(b). This standard of  proof 
for establishing jurisdiction has now been firmly established as a result of 
many cases both before and after the leading case, which is the decision of this 
Court in Canada Trust Co v Stolzenberg (No 2).[24] The same standard has 
been adopted in relation to jurisdictional issues under the Regulation.[25] In this 
context the expression "good arguable case reflects the notion that one sid e 
has "much the better of the argument" on the point. This standard was 
accepted by both sides on the appeal, although Mr Layton correctly 
emphasised that issues of law on the jurisdiction issue have to be decided by 
this court, unless it is a matter of EU  law which is not " acte clair", in which 
case we must refer the matter to the Court of Justice of the European Union 
("CJEU").[26]  
22. Secondly, in relation to the proper construction of Article 60(1)(b), in 
particular the meaning of the words "central administration", the judge 
considered various language versions of the text of the Regulation,  
Explanatory Memoranda on it (in English and German) and the Official 
Report of Professor Fausto Pocar on the revised Lugano Convention (2007) 
which adopted the same test of "domicile" for legal persons or associations of 
natural or legal persons as in Article 60 of the Regulation. The judge examined 
relevant English, German and CJEU decisions to which he was referred. He 
rejected the formulation of Mr Layton that the test for where a company has its 
central administration is "where the main entrepreneurial  decisions which 
determine the activity of the company" are taken, whether they be taken by the 
company, its parent or anyone else. Instead, the judge held that:  
"…the question where a company has its central administration clearly 
depends upon where the company itself carries out its functions, and unless 
the company can properly be said to act through another person or entity 
because of agency or delegation or on some other legally recognised basis, the 
actions of others do not determine the question".[27]  
23. Thirdly, on the facts, the judge concluded that none of the evidence indicated 
that AASA carried out any function in England; it did all its business in South 
Africa. Further, "the fact that decisions taken, or policies and strategies 
adopted by [AA] in England influence, indeed strongly influence, the decision 
taken by AASA in South Afri ca does not alter the position".[28]  
24. Fourthly, the judge rejected a subsidiary argument of Mr Layton that the 
central administration of a subsidiary company will be the domicile of its 
parent company where the parent could exercise control over, or usurp control 
from, that subsidiary. To introduce such a test would mean th at there would 
have to be an inquiry in each case as to what control, in law, a parent could 
exercise over a subsidiary company, which would defeat the whole object of 
the introduction of the rule in Article 60(1), which was to provide a simple, 
factual te st. Moreover, there was nothing in the cases or commentaries to 
support such a construction.[29]  
25. Lastly, the judge concluded that the meaning of "the place where [an entity] 
has its central administration" was clear and so there should not be a reference 
on the issue of construction of Article 60 to the CJEU. He concluded that: 
"AASA has its  central administration in South Africa and not in England and 
the claimants do not have an arguable case to the contrary".[30]  
IV. The arguments of the parties on the appeal and the issues for decision.  
26. First, Mr Layton attacked the emphasis in the findings of fact of the judge. Mr 
Layton submitted that the judge had concentrated too much on "who" took the 
decisions in the Group, rather than "what" decisions were taken and "where" 
they were taken. AASA's principal function was to hold the shares of the 
Group's South African companies and to be the vehicle through which AA 
implemented its st rategy within the Southern African region. That was done 
through the AA board, the GMC and Exco, the GMC Rules and the Group's 
Investment Evaluation Guidelines. Mr Layton submitted that, effectively, all 
corporate decision making, by AASA as well as operat ional companies such 
as Kumba and Amplats, was in London. It went further than AASA paying the 
greatest attention to the wishes of AA, he submitted; the board of AASA 
could, in fact, only do as it was told to do by the institutions of AA, which 
were all ba sed in London.  
27. Secondly, Mr Layton criticised the judge's approach to the construction of 
Article 60. It was common ground that the phrase "central administration" has 
to be given an "autonomous" meaning. However, relying on the German 
language version of  the Article, Mr Layton submitted that the three phrases in 
Article 60(1)(a), (b) and (c) reflected a distinction commonly accepted in 
German and other 
 civil
  law systems between the domicile of a legal person 
being the place of its "statutory seat" ( Article 60(1)(a) ) or its "real seat" 
(Article 60(1)(b) and (c)) .[31] Mr Layton submitted that this means  that the 
board meetings and formal decisions of the organs of a company will take 
place at the "statutory seat" but the principal economic activity of the company 
will be undertaken at its "principal place of business" or "real seat". Mr Layton 
pointed to  the German language commentary on the text of the Regulation, 
which equated the concept of "principal place of business" with "real seat": or, 
in the German, "tatsächlicher Sitz". Mr Layton argued that "central 
administration" must mean something different from these two concepts and it 
was intended to be the place where the strategic business decisions were taken, 
whether or not the "decision makers" are individuals who constitute the 
"organs" of the relevant company itself. Mr Layton also relied on the 
commentary of Dr Hans von der Groeben and Dr Jürgen Schwarze[32] in 
relation to Article 48EC of the EC Treaty , now Article 54FEU  of the Treaty 
on the Functioning of the European Union ("FEU Treaty")[33] granting the 
same "freedom of establishment" to companies and other legal persons as 
natural persons. Their commentary suggests that "central administration" 
means "the place where decisions are made and entrepreneurial ma nagement 
effectively takes place", although the commentary also goes on to state that in 
the case of a group, this will not be the place where group management takes 
place, but "the place of the bodies of the dependent undertaking which intends 
to exercise  the right of establishment".[34] This distinction is important.  
28. Mr Layton referred to a number of English and European authorities on 
Article 60. These included the English cases of: King v Crown Energy 
Trading AG,[35] Ministry of Defence and Support of the Armed Forces for 
Iran v Faz Aviation Ltd and Al -Zayat[36] and Alberta Inc v Katanga Mining 
Ltd.[37] He referred to the German Federal Supreme Court ( Bundesgerichtshof ) 
judgment of 27 June 2007;[38] the German Federal Labour Court 
(Bundesarbeitsgericht ) decision 5 AZR 60/07 of 23 January 2008[39] and the 
German District Court for Frankfurt am Main decision 2 -08 S 25/09 of 3 
March 2010. Mr Layton also referred to the decision of the CJEU in Regina v 
HM Treasury and another ex parte Daily Mail and General Trust PLC,[40] a 
case in which Advocate General Damon made comments on the concept of 
"central managemen t" for the purposes of what is now Article 54FEU .  
29. In summary Mr Layton submitted that the judge had erred in two respects. 
First, the "central administration" of a company, for the purposes of Article 
60, was where the policy shaping entrepreneurial busin ess decisions were 
made, looking at the position overall. That test had to be applied to the facts of 
this case, which had to take account of the fact that AASA was a part of the 
Group in which the "parent" company AA was, in reality, the vehicle through 
which Group decisions were made. Secondly, the judge therefore erred in 
concluding that AASA's decisions were not made in London. As an 
alternative, Mr Layton submitted that if the entrepreneurial decisions that were 
made on behalf of AASA in London could b e relevant to a decision on 
whether the "central administration" was in England, then the meaning of 
Article 60(1)b) was not acte clair and so the court should make a reference to 
the CJEU.  
30. On behalf of AASA, Mr Guy Philipps QC submitted that the fallacy in the 
arguments of the appellant lay in their attempt to divorce the actions of 
individuals from the organs of the company that was responsible for taking 
decisions. It is the "central administration" of the relevant company that has to 
be located and the  appellant's arguments ran the danger of forgetting that all 
companies in a group were separate legal entities. The "central administration" 
of AASA was located where that company, through relevant individuals and 
organs, took its entrepreneurial decisions , even if AA was the entity which 
formulated "group strategy" and influenced the decisions of AASA.  
31. In the submission of Mr Philipps the meaning of "central administration" is 
clear. He accepted that the description of "central administration" given in 
several of the German commentaries, and adopted in the German court 
decisions referred to above, is correct. This is to the effect that a company's 
"central administration" is the place where the decisions of the company are 
made and the entrepreneurial mana gement of the company itself effectively 
takes place; or where the "policy - shaping" and "actual business management" 
of the company itself is centred. Mr Philipps submitted that the meaning was 
clear and there was no need for a reference to the CJEU. The judge carefully 
considered all the evidence and his conclusion that, in the case of AASA, this 
location was in South Africa, cannot be faulted.  
32. Mr Howard Palmer QC adopted the arguments of Mr Philipps. He also 
submitted that the characterisation of the me aning of "central administration" 
by HHJ Chambers QC in King v Crown Energy Trading AG was wrong.  
33. There are only three issues that have to be decided on this appeal. The first is 
whether the judge's interpretation of the words "central administration" in 
Article 60(1)(b) was correct. The second is whether there is any doubt as to 
that construction such that we should make a reference of the issue to the 
CJEU. The third is whether, on the assumption that the judge's construction 
was correct, his conclusion on the facts that the "central administration" of 
AASA was in South Africa was correct.  
V. The interpretation of the words "central administration" in Article 
60(1)(b) of the Regulation.  
34. The parties were correct to accept that the wording of Article 60 must be given 
an "autonomous" meaning, that is a meaning not based on the canons of 
construction of any particular Member State's system of law. In order to 
consider the correct interpretation of the wording it is necessary to look at the 
objectives of the  Regulation as a whole, particularly as noted in the Recitals of 
the Preamble to the Regulation, as well as the context of Article 60 within the 
Regulation and any relevant official commentary.  
35. Paragraph 11 of the preamble of the Regulation states that the "rules of 
jurisdiction must be highly predictable and founded on the principle that 
jurisdiction is generally based on the defendant's domicile…". The same 
paragraph also stipulates that:  
"…The domicile of a legal person must be defined autonomou sly so as to 
make the common rules more transparent and avoid conflicts of jurisdiction".  
36. Article 60 is found in Chapter V of the Regulation, which is headed "General 
Provisions". It consists of Articles 59 -65. Article 59 deals with the "domicile" 
of a pa rty generally. Article 61 deals with the special situation where a person 
is facing certain types of criminal charges in one state in which he is not 
domiciled. Articles 62 – 65 relate to specific circumstances in specific 
Member States. Article 60 is the sole article to deal with the domicile of "a 
company or other legal person or association of natural or legal persons". 
Article 60(2) sets out a specific rule for the UK and Ireland as to what 
constitutes the "statutory seat" of a legal person. Article 60( 3) deals with the 
domicile of a trust.  
37. It is clear that Article 60(1) is drafted so that a company (and the other entities 
referred to which I will not keep repeating) may have three different locations 
of domicile for the purposes of the Regulation, beca use, for that purpose, the 
domicile of a company may be the place of its "statutory seat" or its "central 
administration" or its "principal place of business". Thus it is intended to give 
a claimant a wider choice of where he can sue a company using the ge neral 
rule in Article 2(1) of the Regulation that "…persons domiciled in a Member 
State shall, whatever their nationality, be sued in the courts of that Member 
State." This analysis accords with the commentary in paragraph 28 of the 
official Explanatory Re port of Professor Fausto Pocar on the revised Lugano 
Convention of October 2007. The revised Lugano Convention used the same 
wording as that of Article 60 of the Regulation. Professor Pocar also points 
out, at paragraph 30, that the choice of a "broad defi nition" was made to allow 
a company to be brought before a court in a state bound by the Convention (or, 
I would say, the Regulation ) "with which [the company] has a significant 
connection, in the shape of its central administration, its principal place of  
business or its statutory seat". The adoption of three possible "connecting 
factors" followed those used in Article 48EC of the EC Treaty for recognising 
the right of establishment of companies or firms in the territory of the EU.[41] 
One connecting factor in Article 48 is the "central administration" of a 
company.  
38. It is, I think, important  to note that it is the "central administration" of the 
company sought to be sued  that has to be identified. It is no accident that the 
wording of Article 60(1) is that "…a company…is domiciled at the place 
where it has its …(b) central administration. (My emphasis). There is no 
suggestion in either the Regulation or in Professor Pocar's Explanatory Report 
or in any commentary that any different approach should apply where a 
company is a part of a group of companies. I accept that if, on the facts of a 
particular case, company A in a group has taken over or "usurped" the relevant 
functions of the organs of company B, which is the company sought to be 
sued, then it may well be arguable that the "central administration" of 
company B is where company A makes tho se decisions on company B's 
behalf. But Mr Layton did not advance an argument on the facts of this case 
that AA had "taken over" or "usurped" the decision making process of AASA. 
He accepted that the search in this case was for the location of the "central  
administration" of AASA itself.  
39. What then is the correct interpretation of the words "central administration" in 
Article 60(1)(b) , bearing in mind that it is one of three alternative possible 
"domiciles" of a company for the purposes of the Regulation . Article 60 
contemplates the possibility that a company's "statutory seat", its "central 
administration" and its "principal place of business" could be in the same or in 
different locations. In my view the draftsman of Article 60 also plainly 
contemplated th at the three attributes of the company set out in Article 
60(1)(a), (b) and (c) were to be differentiated. Thus the first is the domicile for 
the purpose of the internal laws of the state where the company is 
incorporated. It will usually be identified in its Memorandum and Articles of 
Association or equivalent. The third is the place where the company does its 
principal "business". Where that is must be a question of fact in each case. The 
second attribute is different in kind from the other two, although it may be that 
its location is the same as one or other or both. In all cases, as Professor Pocar 
pointed out in his commentary on Article 60 in his Official Report on the 
amendments to the Lugano Convention, the aim is that the "statutory seat", or 
"centr al administration" or "principal place of business" will be a location with 
which the potential defendant company will have a real connection with a 
Member State at the relevant time, viz. when the proceedings are issued.  
40. Given the need to differentiate b etween the three attributes of a company 
contemplated by the three phrases used in Article 60(1), I would give the 
phrase "central administration" the same meaning as that which was given by 
commentators to the same phrase in what is now Article 54FEU, which grants 
the same right of freedom of establishment to companies and other legal 
persons and associations as to natural persons who are nationals of Member 
States of what is now the EU. Thus I agree with the interpretation given by Dr 
Ulrich Everling in 1 964[42] to the "central administration" of a company in that 
context; it is the place wh ere "the company organs take the decisions that are 
essential for the company's operation". In my view his emphasis that it is only 
the organs of that company that counted and it was irrelevant "whether the 
company depends upon the decisions of a parent co mpany which has its 
domicile outside the Community" is correct. His interpretation is, effectively, 
the same as that used in the commentary of Dr Hans von der Groeben and Dr 
Jürgen Schwarze on Article 48EC ,[43] although they also refer to the place 
where "entrepreneurial management effectively takes place". That amounts to 
the same thing in m y view. The same phraseology is used in two further 
commentaries which note that the same words are used in both Article 54FEU 
and Article 60(1) of the Regulation.[44]  
41. Even more persuasively, the German Federal Supreme Court 
(Bundesgerichtshof ) adopted this line of interpretation, citing the work of 
Professor Dr Kropholler, when it considered Article 60(1)(b) in the context of 
a jurisdiction dispute concerning a company in its Ruling XII ZB 114/06 of 27 
June 2007. The analysis of the German Federal Supreme Court was followed 
by the German Federal Employment Tribunal ( Bundesar beitsgericht)  in its 
decision 5 AZR 60/07 of 23 January 2008,[45] which also concerned Article 60. 
The court drew a distinction between "essential business decisions" and "mere 
secondary management tasks such as accounting and settling of tax matters", 
which were irrelevant for the purposes of determining the seat of the "head 
office". That a nalysis was in turn followed by the District Court ( Landgericht ) 
for Frankfurt am Main in its decision 2 -08 S 25/09 of 3 March 2010.  
42. The phrase "central administration" in what is now Article 54FEU (then 
Article 58 of the EEC Treaty) was also considered b y the CJEU in R v HM 
Treasury ex parte Daily Mail and General Trust PLC.[46] Advocate Ge neral 
Darmon referred with approval to Dr Everling's interpretation of "central 
administration".[47] The judgment of the Court itself does not directly comment 
on those words.  
43. As already noted, the interpretation of "central administration" has been the 
subject of decisions in the English courts. The most recent to which we were 
referred was  that of Tomlinson J in 889457 Alberta Inc v Katanga Mining.[48] 
One of the issues in th e case was whether the first defendant, which was a 
company incorporated in Bermuda, resident in Canada for tax purposes and 
which had its principal office in London and had a 75% interest in a valuable 
copper and cobalt mine in the Democratic Republic of Congo, was domiciled 
in England for the purposes of Article 60(1). Tomlinson J held that the 
company had its "central administration" in London because "those who have 
the serious responsibilities in the company have their place of work" in 
London.[49] With respect to Tomlinson J, who did not have the benefit of the 
German commentaries or cas e law for his consideration, I think it does not 
necessarily follow that the place where those who have serious responsibility 
in the company work is the place where the "central administration" of the 
company will be. The correct interpretation of Article  60(1)(b) is to find the 
place where the essential decisions are taken by the company through its 
organs for that company's operation and where the company takes its 
"entrepreneurial" decisions. The place of work of those who have "serious 
responsibility" for decisions and the place where the essential decisions of the 
company are made could be different. It is always going to be a question of 
fact.  
44. The older case of The Rewia,[50] which concerned (amongst other things) an 
issue of whether the "central management and control" of a company was in 
England for the purposes of section 42(6) of the 
Civil
 Jurisdiction and 
Judgments Act 1982 and Article 52 of the Brussels Convention, is not helpful 
on the interpretation of the different wording in Article 60(1)(b) of the 
Regulation. The suggestion of HHJ Chambers QC at paragraph 12 of his 
judgment in King v Crown Energy Trading AG[51] that "administration" has 
something of the "back office" abo ut it and the statement in paragraph 13 of 
the judgment that the place of a company's "central administration" can be 
determined by "a simple listing of those with important responsibilities in the 
company" is equally unhelpful and, in my view, should be d isregarded. In 
Ministry of Defence and Support of the Armed Forces for the Islamic 
Republic of Iran v Faz Aviation Ltd[52] Langley J made no analysis of the 
meaning or interpretation of the words "central administration" beyond 
referring to The Rewia and King v Energy Crown Trading AG.  
45. Overall, then, I conclude that the correct interpretatio n of "central 
administration" in Article 60(1)(b), when applied to a company, is that it is the 
place where the company concerned, through its relevant organs according to 
its own constitutional provisions, takes the decisions that are essential for that 
company's operations. That is, to my mind, the same thing as saying it is the 
place where the company, through its relevant organs, conducts its 
entrepreneurial management; for that management must involve making 
decisions that are essential for that compan y's operations. As Andrew Smith J 
pointed out at [71] of his judgment, that location will be where the company 
(or other entity) has its "central administration" for the purposes of Article 60 
and that will therefore be a jurisdiction where, for the purpos es of the 
Regulation, the company has its domicile and so can be sued under the 
jurisdictional rule of Article 2 . Therefore I agree with Andrew Smith J's 
conclusion on the issue of the interpretation of Article 60(1)(b). .  
VI. Is there any doubt about the interpretation of "central 
administration" in Article 60(1)(b) such that a reference to the CJEU is 
necessary?  
46. In my view the clear answer to this question is "no". The Pocar Report, the 
German commentaries, the decisions of th e German courts and the view of 
Advocate General Damon in the Daily Mail Trust case all go the same way. In 
the only relevant English decision that might have a different emphasis, that of 
Tomlinson J in 8889457 Alberta Inc, the judge did not have the bene fit of the 
German or ECJ jurisprudence. In my view there can be no doubt as to the 
correct interpretation of the phrase and I would therefore decline to make a 
reference.  
VII. Was the judge's conclusion on the facts that the "central 
administration" of AA SA was in South Africa on 25 August 2011 correct?  
47. The judge's task was to assess the evidence he had before him and arrive at a 
provisional conclusion of fact (ie. whether or not the claimant had a "good 
arguable case") by reference to a juridical concept,  viz. that of the place of the 
"central administration" of AASA. So the question was simply: did Miss 
Young have a "good arguable case" that AASA had its "central 
administration" in England on 25 August 2011 for the purposes of Article 
60(1)(b). This court  has said, on many occasions, that where the task of the 
judge is to make an overall assessment of the evidence by reference to a 
juridical concept, then the Court of Appeal will not interfere with the 
assessment and conclusion of the judge unless it is ma nifestly wrong on the 
basis of the material before him.  
48. In this case the judge was correct to concentrate on the factual position 
relating to AASA itself and to search for the place where AASA itself, through 
its relevant organs according to its constitut ional provisions, made the 
decisions that were essential for AASA's own business, or where AASA's own 
"entrepreneurial" decisions were taken. In that way he would arrive at a 
provisional view on where AASA had its "central administration" at the 
relevant d ate. The judge was correct not to be diverted by Mr Layton's 
ingenious attempt to turn the issue around so as to ask the more impersonal 
question "where were the main entrepreneurial decisions taken which 
determined the activity of AASA". That is the wrong  question. It removes the 
focus from where it should be, which is on the decisions of the company itself. 
It obfuscates matters by looking at other companies in the Group or the Group 
as a whole. It gets away from the essential question: where does AASA ha ve 
its "central administration"?  
49. Once this point is appreciated, it seems to me that the answer in this case is 
obvious and it is the answer the judge gave at [72] of his judgment: "None of 
the evidence indicates that AASA carries out any function in Engl and: it does 
all its business in South Africa". AA and its organs, based in London, plainly 
guided and even heavily influenced the decisions taken by the board of 
AASA. But, as the judge also correctly stated, that "does not alter the 
position". Nor does t he fact that Mr Gomwe had a role that was a "Group" role 
as well as being the Executive Director of AASA. Nothing that Mr Layton 
said about the judge's analysis of the facts has persuaded me that his approach 
or conclusions were even arguably wrong. Not on ly is there no "good arguable 
case" that AASA had its "central administration" in England in August 2011, 
there is no case at all.  
50. Mr Layton did briefly resurrect the argument referred to by the judge at [73], 
ie. if it is shown that AA could exert or usu rp control over AASA, then that 
would be enough to establish a good arguable case that AASA's "central 
administration" is in England. I respectfully agree with the answer the judge 
gave to that argument. Article 60(1)(b) is not dealing with possibilities b ut 
with actualities. If it were dealing with what a parent company had the power 
to do ("could do") then that might lead to arguments about the powers of 
parent companies over subsidiary companies in the context of a group. That, in 
turn, would lead to arg uments concerning the correct interpretation of the 
constitutional provisions of parent and subsidiary companies, perhaps with 
their "statutory seat" in different countries, thus possibly involving the internal 
company law provisions of more than one state . The whole aim of Article 
60(1) was, as Professor Pocar pointed out at paragraphs 27 and 28 of his 
Explanatory Report, to cut out such possible complications. So I would reject 
this alternative argument.  
VIII. Disposal  
51. For these reasons I would dismiss t he appeal and uphold the order of Andrew 
Smith J dated 24 July 2013.  
Dame Janet Smith:  
52. I agree.  
The Master of the Rolls:  
53. I also agree.  
Note 1    The reason for the “good arguable case” test is explained in [21] below.     [Back]  
Note 2    This provides: “…persons domiciled in a Member State shall whatever their nationality be 
sued in the courts of that Member State”; the Member State being, in this case, the UK.     [Back]  
Note 3    [32] of Andrew Smith J’s judgment.     [Back]  
Note 4    [47] of Andrew Smith J’s judgment.     [Back]  
Note 5    [34] of Andrew Smith J’s judgment.     [Back]  
Note 6    See[31] of the judgment o f Andrew Smith J.     [Back]  
Note 7    [33] of the judgment of Andrew Smith J.     [Back]  
Note 8    It was on that basis that the claimants in the two actions were prepared to accep t that AASA 
did not have its “principal place of business” in England for the purposes of Article 60 of the 
Regulation (See: [33] of the judgment. Of course, whether AASA had its “central administration” in 
England in August 2011 remains a separate issue.     [Back]  
Note 9    There were two further directors of AASA: Mr Rene Medori and Mr Nevil le Nicolau.     [Back]  
Note 10    [36]    [Back]  
Note 11    [36 (ii)].     [Back]  
Note 12    [37], referring to the decision of Park J in Holden v Wood [2005] EWHC 547 (Ch)  at [25]. 
    [Back]  
Note 13    [48].     [Back]  
Note 14    [51(i)].     [Back]  
Note 15    [51(iii)]     [Back]  
Note 16    [51(iii)]     [Back]  
Note 17    Andrew Smith J’s phrase at [64]     [Back]  
Note 18    [61]    [Back]  
Note 19    [64]    [Back]  
Note 20    [38].     [Back]  
Note 21    [39]    [Back]  
Note 22    [40]    [Back]  
Note 23    [40]    [Back]  
Note 24     [1998] 1 WLR 547  at 555 per Waller LJ with whom the other two jud ges agreed.     [Back]  
Note 25    See eg: Bols Distilleries BV v Superior Yacht Services Ltd [2007] 1 WLR 12  at [23] -[28] in 
the judgment of Lord Rodger of Earlsferry giving the Advice of the Board.     [Back]  
Note 26    I will use this expression to include the European Court of Justice, the name of the CJEU 
until it changed after the Lisbon Treaty.     [Back]  
Note 27    [71].     [Back]  
Note 28    [72].     [Back]  
Note 29    [74]    [Back]  
Note 30    [75].     [Back]  
Note 31    In the German language version the word for “principal place of business is 
“Hauptniederlassung”, which Mr Layton translated literally as “principal establishment”, which he 
equated with “ tatsächlicher Sitz” which he translated as “real seat”.     [Back]  
Note 32    Commentary on the Treaties on European Union and establishing the Eur opean Community: 
6th Ed 2003.     [Back]  
Note 33    This provides: “Companies or firms formed in accordance with the law of a Member State 
and having their registered office, central administration or principal place of business within the  
Community shall, for the purposes of this chapter, be treated in the same way as na tural persons who 
are nationals of Member States”.     [Back]  
Note 34    Commentary on th e Treaties of the European Union and establishing the European 
Community: 6th Ed (2003) Art 48 margin 9. A similar comment is made by Dr Ulrich Everling in The 
Right of Establishment in the Common Market (1964) para 314 and other commentators.     [Back]  
Note 35    [2003] 2 CLC 540, a decision of HHJ Chambers QC.     [Back]  
Note 36    [2008] 1 All Er (Comm) 372, a decision of Langley J.     [Back]  
Note 37    [2009] 1 BCLC 189 , a decision of Tomlinson J.     [Back]  
Note 38    NJW -RR 2008 551.     [Back]  
Note 39    [2008] NJW 2797     [Back]  
Note 40    [1989] 1 QB 446.     [Back]  
Note 41    See para 31 of Prof Pocar’s Explanatory Report.     [Back]  
Note 42    The Right of Establishment in the Common Market: para 314 (1964).     [Back]  
Note 43    Commentary on the Treaties on European Union and establishing the Europe an Community: 
6th Ed 2003.     [Back]  
Note 44    European 
 Civil
  Procedure Law Commentary by Prof D r Reinhold Geimer and Prof Dr 
Rolf A Schütze: 2nd Ed 2004; European 
 Civil
  Procedure law by Prof Dr Jan Kropholler: 8th Ed 
2005.     [Back]  
Note 45    [2008] NJW 2797.     [Back]  
Note 46    [1989] 1 QB 446.     [Back]  
Note 47    See page 453C.     [Back]  
Note 48    [2009] 1 BCLC 189     [Back]  
Note 49    See [23] of the j udgment, adopting a suggestion of Prof. Adrian Briggs in para 2.115 of the 
4th (then current) edition of 
 Civil  Jurisdiction and Judgments. The same suggestion is repeated at 
para 2.138 of the current 5th edition. There is no reference to the German commentary o r cases. 
    [Back]  
Note 50    [1991] 2 Lloyd’s Rep 325     [Back]  
Note 51    [2003] 2 CLC 540     [Back]  
Note 52     [2008] 1 All ER (Comm) 372 .    [Back]