Competent Court in Consumer v. Trader Disputes in E-Contracts: A Comparative Study of European Union and Iranian Law

Document Type : Research Paper

Authors

1 Ph.D. Student in Private Law, Department of Private Law, Faculty of Law and Political Science, Ferdowsi University of Mashhad, Mashhad, Iran

2 Assistant Prof., Department of Private Law, Faculty of Law and Political Science, Ferdowsi University of Mashhad, Mashhad, Iran

3 Prof., Department of Private Law, Faculty of Law and Political Science, Ferdowsi University of Mashhad, Mashhad, Iran

Abstract

Introduction
In contemporary legal systems, substantive consumer protection rules address only part of the challenges arising from consumer contracts, making it equally crucial to examine extraterritorial jurisdiction rules governing consumer e-contract disputes. This article conducts a comprehensive analysis of jurisdictional rules applicable to consumer e-contract disputes in both the European Union and Iranian legal frameworks. The study specifically investigates scenarios where: (1) a consumer domiciled in Iran disputes an e-contract with an EU-domiciled trader; and (2) an EU-domiciled consumer initiates proceedings against a non-EU trader. These cross-border situations raise critical questions about which court possesses competent jurisdiction to adjudicate such disputes. 
Methods
This research employs an analytical-descriptive methodology with a comparative law approach, examining both Iranian and EU legal systems. The analysis focuses on applicable jurisdictional rules within these frameworks, evaluating their respective strengths and weaknesses through doctrinal legal analysis. The study incorporates examination of primary EU legal instruments, particularly the recast Brussels I Regulation (2012), and relevant Iranian legislation. European case law precedents are analyzed to illustrate practical applications of these rules. Data collection was conducted through traditional library research methods, utilizing legal texts, scholarly articles, and judicial decisions.
Results and Discussions
The research reveals significant divergences between the EU and Iranian approaches to determining competent courts in consumer e-contract disputes: In Iranian law, statutory provisions lack specific rules regarding extraterritorial jurisdiction for consumer e-contracts. Consequently, Iranian judges must resort to applying domestic jurisdiction rules, which may prove inadequate for cross-border digital transactions. This legal gap creates uncertainty for both consumers and traders engaged in international e-commerce. Conversely, the EU's recast Brussels I Regulation (2012) establishes a sophisticated jurisdictional framework for consumer disputes. Article 17(3) introduces the critical "directing activities" test, whereby jurisdiction is established when traders direct their commercial activities to the consumer's domicile. Article 18 then outlines three distinct jurisdictional presumptions: First, when both parties are EU-domiciled, consumers enjoy multiple forum options including their own domicile, the trader's domicile, or the location of the trader's branch/agency involved in the contract. This expansive approach significantly enhances consumer access to justice. Second, for EU-domiciled consumers suing non-EU traders without EU establishments, Article 18 permits consumers to file in their home courts regardless of the trader's domicile. This protective measure ensures EU consumers maintain access to local judicial remedies. Third, when non-EU consumers dispute with EU-domiciled traders, jurisdiction defaults to the general rule of defendant's domicile under Article 4, requiring consumers to litigate in the trader's home jurisdiction. This asymmetrical treatment reflects policy choices favoring EU consumers.
Conclusions
The comparative analysis demonstrates that the EU's jurisdictional framework prioritizes consumer protection through expansive forum options 
and the "directing activities" test, while Iranian law lacks specific mechanisms for cross-border e-contract disputes. Notably, the EU system disregards both the contract conclusion location and performance place as jurisdictional factors- elements that remain relevant in Iranian jurisprudence. The study recommends that Iranian law adopt a modified version of the plaintiff's domicile rule, incorporating safeguards like the EU's targeting test to prevent excessive jurisdictional claims. Without such balanced reforms, Iranian consumers will continue facing significant disadvantages in cross-border e-commerce disputes. The EU model offers valuable insights for developing countries seeking to modernize their private international law frameworks for the digital economy.

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Main Subjects

References

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