PrimaCom gives lenders certainty on jurisdiction

A recent German ruling gives international lenders certainty that German courts will uphold English law jurisdiction clauses. By Sven Schulte-Hillen and Markus J Friedl

This article appears courtesy of International Financial Law Review

On September 13 2005, the District Court of Mainz, Germany, dismissed a lawsuit brought by telecoms company PrimaCom against its lenders under its second secured loan facility. The court upheld the jurisdiction clause giving the courts of England exclusive jurisdiction over all disputes relating to the loan agreement and rejected PrimaCom’s claims based on the lack of international jurisdiction. PrimaCom had claimed that the loan agreement was null and void because it violates German public policy.