Famanet v. Reuters: 20 million euros claim must be tried in Cyprus

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A Nicosia Court has held that the choice of jurisdiction and law clauses cannot present an obstacle to protecting commercial representatives who exercise their activity within member states. This protection is provided by a European Directive that has now been incorporated into Cypriot legislation. The company Reuters applied to the Nicosia District Court asking for the legal action filed against them by the Cypriot company, Farmanet Holdings Ltd, in the Cypriot Courts to be dismissed. They alleged that the American Courts had jurisdiction to try the dispute due to an exclusive jurisdiction clause in the agreement, which referred to New York as the proper jurisdiction to hear the dispute. Famanet, via its lawyers, Georgiades & Mylonas, filed an objection claiming that according to European Law and in particular a European Directive that has now been incorporated into Cypriot company law, the Cypriot Courts were the most appropriate place to try the dispute. The submissions put forward by Famanet’s lawyers, Georgiades & Mylonas, also referred to Ingmar G.B. Ltd v Eaton Leonard Technologies Inc-Reference for a preliminary ruling, European Court Reports 2000 page I-09305, a case that had come before the European Court of Justice, which contained similar characteristics and circumstances. The Court, following the principles laid down in The Eleftheria [1969] 2 All E.R 641 and those concerning Forum non Conveniens, held that the claimants succeeded in proving that all of the necessary conditions justifying that the Cypriot Courts had jurisdiction to try the claim filed by Famanet had been met and that consequently, any proceedings initiated must be continued in Cyprus

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