Where Should a Claim Be Notified to a Parent Company Whose Registered Office is Abroad, Despite Having Subsidiaries with Registered Offices in the National Territory?

This question has led to numerous legal interpretations, to the point where the Spanish Supreme Court has raised a preliminary ruling before the Court of Justice of the European Union (CJEU) in one of the many proceedings related to the so-called "Truck Cartel."

Currently, the answer is clear: the notification and service of the claim must be made to the defendant company in its country of residence, even if it has a subsidiary with a registered office in Spain.

In any legal proceeding, time can be a critical factor, especially if our client is the plaintiff. There might be a temptation to expedite the process as much as possible, using shortcuts in serving the claim. However, in this case, attempting to serve a parent company through its subsidiary in Spain, when the parent company is domiciled in another European Union country, can result in a nullity of proceedings.

Regarding the preliminary ruling, on January 11, 2024, the Advocate General of the European Union presented a non-binding opinion to the CJEU in Case C-632/22, concluding clearly and emphatically that:

1.-) "A parent company established in another Member State (Sweden) has the right not to appear when the claim has been notified at the address of its subsidiary established in another Member State (Spain)."

2.-) "Similarly, a subsidiary (located in Spain) cannot be required to accept service of a claim directed at its parent company established in another Member State (Sweden)."

The Advocate General bases his arguments on the fact that notification and service in judicial proceedings must be carried out in accordance with Regulation No. 1393/2007 of November 13, 2007, which regulates the service and transmission of judicial and extrajudicial documents in civil or commercial matters within the Member States.

He reminds us that "the principle according to which a person sued in civil proceedings has the right to be personally served with the claim in sufficient time to prepare their defense is a fundamental element of the right to a fair trial."

Indeed, there are regulations within the European Union that specifically address situations where a person resides in a different state from where the proceedings are initiated. Article 28 of Regulation No. 1215/2012 of December 12, 2012, on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters states: "This court shall stay the proceedings so long as it is not shown that the defendant has been able to receive the document instituting the proceedings or an equivalent document in sufficient time to arrange for his defense, or that all necessary steps have been taken to this end."

Additionally, Article 19 of Regulation No. 1393/2007 of the European Parliament and of the Council of November 13, 2007, provides: "When a document instituting the proceedings or an equivalent document has been transmitted to another Member State for service there according to the provisions of this Regulation, and the defendant does not appear, judgment shall not be given until it is established that: (i) the document has been served by a method prescribed by the internal law of the Member State addressed for the service of documents in domestic actions upon persons who are within its territory, or (ii) the document has actually been delivered to the defendant or to his residence by another method provided for by this Regulation, and in either case, that the service or delivery was effected in sufficient time to enable the defendant to defend."

Thus, the court where the proceedings are taking place must ensure that the defendant receives the notification and service documents at their domicile despite (i) residing in a different Member State, and (ii) having a subsidiary in the state where the proceedings are initiated.

Moreover, the court must suspend the proceedings until it verifies that the service of notification has been effectively served on the defendant, ensuring the right to an effective defense and avoiding any form of legal helplessness due to residing in a different country from where the judicial proceedings are taking place.

To avoid inadmissibility, we must also remember to provide the claim in Spanish, along with its translation and the necessary documents, accompanied by Form A (Annex I) as stipulated in Regulation 2020/1784 of the European Parliament and the Council of November 25, 2020.