Ministry of Defence and Support of the Armed Forces for the Islamic Republic of Iran v Faz Aviation Ltd.& Anor

For jurisdiction under the Brussels jurisdiction regime, a company may be domiciled in more than one place because its statutory seat, central administration and principal place of business are alternative bases. The relevant question is where the company had the asserted connection when proceedings were issued. The concept is autonomous and is not governed by common-law rules concerning an individual’s domicile.

Principal place of business ordinarily focuses on the centre of corporate authority, control and management. Day-to-day activity in one country will not suffice where it is subject to senior management elsewhere. A company may also cease to have a principal place of business when its business ceases.

The claimant, part of the Iranian government, brought claims in fraud, conspiracy and dishonest assistance concerning payments made for an aircraft which was never delivered. It sought jurisdiction over a Cypriot company and its Cypriot-domiciled managing director.

The claimant relied on the company’s alleged central administration or principal place of business in England under articles 2 and 60 of EU Regulation No 44/2001. The defendants denied that England was a relevant domicile. The central issue was whether the claimant had shown a good arguable case that the company was domiciled in England when proceedings were issued.

Jurisdiction refused. The claimant failed to establish a good arguable case that the company was domiciled in England on 21 July 2006. The court therefore had no jurisdiction over either defendant.

1. Under EU Regulation No 44/2001, the statutory seat, central administration and principal place of business are autonomous and alternative connecting factors. The existence of a previous English connection does not create a continuing domicile. The question is whether the relevant connection existed at the date proceedings were issued.
2. The reasoning in The Rewia was adopted. Principal place of business ordinarily refers to the place where corporate authority is located and from which the company is controlled and managed. The place of day-to-day operations may be subordinate where those operations remain subject to control elsewhere.
3. The evidence could support an English centre of business during the aircraft transaction in 2002–04 and perhaps 2005. However, the transaction had effectively ended by May 2005. At the relevant date the persons active for the company were substantially in Cyprus, and the English connections were insufficient. There was no principal place of business elsewhere on the evidence.
4. Because the court lacked jurisdiction over the company under article 2, it also lacked jurisdiction over the managing director under article 6. The court made orders for the defendants accordingly, with ancillary matters to be addressed at formal hand-down.

First-instance jurisdiction decision. The judgment records no appeal from the present decision.