DENMARK Law and Practice Contributed by: Johannes Grove Nielsen, Camilla Søgaard Hudson, Lars Rosenberg Overby and Malthe Hersom Kløft, Bech-Bruun
The procedure applicable to maritime arbitration and mediation depends on the parties’ agreement and on whether the rules of an arbitration or mediation insti- tute have been specified by the parties. In addition to these procedures, the Danish Maritime and Commercial Court uses expert judges with mari - time expertise. Thus, all maritime cases heard before the Maritime and Commercial Court are heard by a panel of three judges: one legal judge and two lay judges with relevant maritime expertise. 7.6 Remedies Where Proceedings Are Commenced in Breach of Foreign Jurisdiction or Arbitration Clauses The ordinary courts may refer a case to arbitration if, on the basis of a request from one of the parties, the court finds that the case has been commenced incorrectly and is in breach of an arbitration clause. However, this presupposes that the court does not declare the clause invalid or assess that the subject matter cannot be admitted to arbitration. In the event that arbitration proceedings have already been instituted, the courts alone may decide whether the subject is suitable for arbitration. In that case, the pending arbitration proceedings may proceed, irrespective of whether the proceedings are pending before the ordinary courts. If it turns out that the case is not suitable for arbitration, the arbitral tribunal will dismiss the case. According to the Danish Arbitration Act, Section 16, a party’s objection to the validity of an arbitration clause must be submitted no later than the submission of the defence. If proceedings are commenced in breach of a for - eign jurisdiction clause, the remedy depends on the nationality of the jurisdiction clause in question. If the breached jurisdiction clause specifies jurisdic - tion within the EU, and if the Brussels I Regulation is applicable, a Danish court must decline jurisdiction if the court designated in the jurisdiction clause has already declared that it has jurisdiction; otherwise, a Danish court must stay proceedings until the desig - nated court declares whether it has jurisdiction.
If proceedings are commenced in breach of a foreign jurisdiction clause designating a court outside an EU member state, a Danish court may choose to hear the matter if jurisdiction can also be established in Denmark. 8. Ship-Owners’ Income Tax Relief 8.1 Exemptions or Tax Reliefs on the Income of Ship-Owners’ Companies Danish ship-owners are able to choose to be subject to the Danish tonnage tax scheme as an alternative to payment of regular corporate tax. Under the Danish tonnage tax scheme, ship-owners’ income is fixed on the basis of the net tonnage at their disposal. Ship- owners pay tonnage tax irrespective of actual income, profit and loss. The participation of ship-owners in the tonnage tax scheme is voluntary, but the choice of opting in or out is binding for a period of ten years. Special vessels such as supply, construction, offshore and ice-breaking vessels are also eligible for the ton - nage tax scheme. 9. Implications of Non-Performance, IMO 2020, Trade Sanctions and International Conflict 9.1 Force Majeure and Frustration For a non-performing party to invoke force majeure, the party must prove that: • performance of the contract is impossible; and • the exclusion is due to unforeseen events of extraordinary character. Force majeure under Danish law is slightly different from the English term “frustration”. The decisive time factor of whether an event is unfore - seen is the signing of the contract. If the shipping contract was signed before the event of extraordinary character, such event would be considered unfore - seen, and the party could potentially be able to invoke
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