From newspapers we know that NIKI Luftfahrt is in financial trouble. Attempts from third parties to buy all or a significant amount of assets are ongoing. These include takeoff- and landing slots in places such as Vienna, Munich, Palma de Mallorca and Zurich. There also is (evidently) a legal battle. Where is NIKI located? Or better: which is the cente of main interest (COMI) of NIKI Luftfahrt GmbH nach östereichischem recht (NIKI Air GmbH, establishe according to Austrian company law)? It is under corporate control of Air Berlin PLC & Co. Luftverkehrs KG (Air Berlin), active in Germany. But is its COMI in Germany?
On 4 January 2018 the Charlottenburg District Court upheld its decision of 13 December 2017 in which it had decided that NIKI’s COMI was in Germany. I just note some legal arguments.
Article 4 EIR 2015 determines the examination of international jurisdiction. In my book International Insolvency Law Part II 2017/10622h I suggest courts to be guided by six steps, four of which are:
1 Object: international jurisdiction; The court seised with a request to open (main or secondary) insolvency proceedings needs to ascertain its international jurisdiction without any party asking for an examination of the court’s jurisdiction. The court’s role is discretionary, in that interested parties, such as creditors, may send information to the court, but they cannot interfere in the court’s building up its decision. It should, however, be noted that Article 4 EIR 2015 only requires the examination of ‘international’ jurisdiction, the court should test national procedural laws as to its ‘territorial’ jurisdiction in a way which is provided for under the lex fori, see recital 26;
2 Scope of the examination; Examination is required with regard to its international jurisdiction. In literature it is discussed whether the obligation of the court also is to investigate the factual elements forming the requirement of the debtor having its COMI or its establishment in the relevant jurisdiction ex officio. Some authors deny such an obligation, such as Mankowski, in: Mankowski/Müller/J.Schmidt (2016), Art. 4, nr. 8. My take is, that this is too narrow, see under 3 and 4;
3 Depth of examination; Recital 30 says that a court should assess ‘carefully’, whether the debtor’s COMI in ‘genuinely’ located in the Member State. This presupposes quite some detailed analysis;
4 Additional evidence; In practice, first, the court will take into account the facts presented in the request. Where ‘… the circumstances of the matter give rise to doubts about the court’s jurisdiction, the court should require the debtor to submit additional evidence to support its assertions and, where the law applicable to the insolvency proceedings so allows, give the debtor’s creditors the opportunity to present their views on the question of jurisdiction’, thus recital 32. In the light of the utmost importance of determining carefully a debtor’s COMI, it is unfortunate that recital 32 has not been included in the actual text of the EIR 2015 itself.
Article 5(1) EIR 2015 indicates which parties may request a judicial review of the decision to open main insolvency proceedings. These are mainly the debtor itself or any creditor.
The Charlottenburg District Courts decides the following. I am keeping it short:
a Article 5(1) is a European norm, to be autonomously interpreted. National requirements or limitations are not relevant. The same view is held in my Part II, para. 10622nff.
b Article 4(1) is limited to ex officio testing of the evidence (the court finds support in Mankowski’s view). The court also finds, on procedural ground, one should not set to heavy requirements to the activity of testing the facts leading to international jurisdiction. I submit, however, that it should also include further investigation, see also point 3 above, without denying that speed in deciding is certainly important.
c In deciding that COMI was in Germany, the court in its earlier decision has not been overlooking decisive factors, such as:
(i) From assessing the facts it follows that the debtor was incorporated in accordance with corporate law principles of control and operationally in the Air Berlin Group. Air Berlin as directing manager of NIKI has acted as such in a way ascertainably for third parties,
(ii) Where a company has a duty to pay taxes or have certain accounting duties fulfilled can not be decisive,
(iii) Plane tickets which included a certain flightnumber were booked outwardly recognizably via a contract with Air Berlin, and
(iv) The fact that around 80 % of the cabin staff is Austrian can not be decisive.
The Charlottenburg court upheld its decision and announced that, in appeal, the case must be decided by the Landgericht Berlin. A decision may be awaited on short notice, see https://www.berlin.de/gerichte/presse/pressemitteilungen-der-ordentlichen-gerichtsbarkeit/2018/pressemitteilung.662862.php.