International Business Law
Blok 2.4 BK
2022-2023
IBL (MRVH7IBL Mock exam, including anwers
Question 1 (10 points: 5 – 5)
John Smith is an employee of British Petroleum (BP) and works at BP’s headquarters
in London under a one year contract from January 1 st 2015 onwards. BP terminates
the contract after 6 months. This is allowed under UK law. All employment contracts
whether for a definite or un-definite period of time can be terminated unilaterally
according to UK law.
According to EU Directive 04/123 employers are not allowed to terminate a fixed term
contract unilaterally before the fixed term has expired. This Directive was to be
implemented by the end of the year 2013, but the UK government failed to meet the
deadline.
John Smith wants to claim damages from the UK government because it did not
implement Directive 04/123 in time. Had this been done correctly the employment
contract of John Smith could not have been ended July 1 st 2015 and he would still
have an income till the end of the year.
a. Is Directive 04/123 directly applicable in EU member states?
b. Is it possible for John Smith to claim damages from the UK government
because of the fact Directive 04/123 was not implemented in time? If so, which
criteria apply?
Answer
a. A Directive is not directly applicable, but has to be transferred into national law
first before it can take effect. MS have to take further action to implement the content
of the Directive in national legislation. As a result a Directive cannot be directly
applicable.
b. State liability is possible on the following conditions (Francovich) :
a. The Directive must grant rights to individuals
b. The content of the Directive is clear
c. There is a causal link between the damages suffered and the failure
to implement the Directive
In this case all 3 conditions are met and therefore John Smith can successfully claim
compensation for his damages.
, International Business Law
Blok 2.4 BK
2022-2023
Question 2 (15 points)
Leusink is negotiating with Schmidt from Bonn (Germany) about the sale of his
practice in physiotherapy and the building where the practice of Leusink is situated in
Amsterdam (The Netherlands).
After several meetings the two parties agree on:
- the sale of the practice and the lease of the building where the practice is
situated
- a minimum price to be paid by Schmidt for the practice.
Parties cannot reach an agreement on:
- the price to be paid every month by Schmidt for the lease of the building
- the issue whether Leusink himself should act as the seller or not. The reason
for this is that another option could be that Leusink sets up a Limited
company, places the ownership of the practice and the building with this
company and after that has Leusink Ltd. sell it to Schmidt. This set-up would
be more favourable for Leusink, considering the income taxes he would have
to pay.
- furthermore the price to be paid by Schmidt for the so called goodwill remains
a big obstacle between the two parties.
Problems arise when Leusink is no longer prepared to continue the negotiations. In
the assumption that an agreement had not (yet) been reached, Schmidt starts
litigation against Leusink and demands:
- compensation for his costs (€ 15,000 for travelling expenses, costs related to
obtain a Dutch licence to practice physiotherapy, et cetera) and loss of profit
(estimated up to € 50,000 in 2015)
- that Leusink should continue the negotiations.
Will the Dutch court of law that has jurisdiction in this case, in your opinion, award all
the claims put in by Schmidt?
Answer
Is there an agreement between the two negotiating parties? There is no letter of
intent in this case, so check the two essential elements of an agreement:
Object of the agreement:
sale of the practice and lease of the building (+)
Leusink will act as the seller (–).
Price:
lease price (–)
Blok 2.4 BK
2022-2023
IBL (MRVH7IBL Mock exam, including anwers
Question 1 (10 points: 5 – 5)
John Smith is an employee of British Petroleum (BP) and works at BP’s headquarters
in London under a one year contract from January 1 st 2015 onwards. BP terminates
the contract after 6 months. This is allowed under UK law. All employment contracts
whether for a definite or un-definite period of time can be terminated unilaterally
according to UK law.
According to EU Directive 04/123 employers are not allowed to terminate a fixed term
contract unilaterally before the fixed term has expired. This Directive was to be
implemented by the end of the year 2013, but the UK government failed to meet the
deadline.
John Smith wants to claim damages from the UK government because it did not
implement Directive 04/123 in time. Had this been done correctly the employment
contract of John Smith could not have been ended July 1 st 2015 and he would still
have an income till the end of the year.
a. Is Directive 04/123 directly applicable in EU member states?
b. Is it possible for John Smith to claim damages from the UK government
because of the fact Directive 04/123 was not implemented in time? If so, which
criteria apply?
Answer
a. A Directive is not directly applicable, but has to be transferred into national law
first before it can take effect. MS have to take further action to implement the content
of the Directive in national legislation. As a result a Directive cannot be directly
applicable.
b. State liability is possible on the following conditions (Francovich) :
a. The Directive must grant rights to individuals
b. The content of the Directive is clear
c. There is a causal link between the damages suffered and the failure
to implement the Directive
In this case all 3 conditions are met and therefore John Smith can successfully claim
compensation for his damages.
, International Business Law
Blok 2.4 BK
2022-2023
Question 2 (15 points)
Leusink is negotiating with Schmidt from Bonn (Germany) about the sale of his
practice in physiotherapy and the building where the practice of Leusink is situated in
Amsterdam (The Netherlands).
After several meetings the two parties agree on:
- the sale of the practice and the lease of the building where the practice is
situated
- a minimum price to be paid by Schmidt for the practice.
Parties cannot reach an agreement on:
- the price to be paid every month by Schmidt for the lease of the building
- the issue whether Leusink himself should act as the seller or not. The reason
for this is that another option could be that Leusink sets up a Limited
company, places the ownership of the practice and the building with this
company and after that has Leusink Ltd. sell it to Schmidt. This set-up would
be more favourable for Leusink, considering the income taxes he would have
to pay.
- furthermore the price to be paid by Schmidt for the so called goodwill remains
a big obstacle between the two parties.
Problems arise when Leusink is no longer prepared to continue the negotiations. In
the assumption that an agreement had not (yet) been reached, Schmidt starts
litigation against Leusink and demands:
- compensation for his costs (€ 15,000 for travelling expenses, costs related to
obtain a Dutch licence to practice physiotherapy, et cetera) and loss of profit
(estimated up to € 50,000 in 2015)
- that Leusink should continue the negotiations.
Will the Dutch court of law that has jurisdiction in this case, in your opinion, award all
the claims put in by Schmidt?
Answer
Is there an agreement between the two negotiating parties? There is no letter of
intent in this case, so check the two essential elements of an agreement:
Object of the agreement:
sale of the practice and lease of the building (+)
Leusink will act as the seller (–).
Price:
lease price (–)
