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Court Guidance on ‘Domicile’ of Multinational Companies

Published: 27 August 2014, in categories: Personal Injury Updates | Legal Updates | News and Updates

In the era of multinational companies bestriding the globe it can sometimes be difficult to pin down exactly where their administrative hearts lie. However, that task may now be easier after the Court of Appeal gave important guidance on the issue in the context of a clinical negligence claim.

A woman issued proceedings in England against a company registered in South Africa, claiming that her life had been blighted by clinical negligence before her birth at a hospital attached to a mining operation in Botswana. Her lawyers had purported to serve her damages claim on the company’s offices in South Africa.

It was submitted that, although the company had its ‘statutory seat’ in South Africa, its ‘central administration’ was based in London and that it was therefore domiciled in this country. The company was a subsidiary of a multinational corporation registered in London and which was listed on the London stock exchange. It was said that the corporation had substantial control over the company’s strategic management.

However, those arguments were rejected by a judge, who ruled on the evidence that the English courts had no jurisdiction to hear the woman’s claim. In dismissing her appeal, the Court could find no flaw in the judge’s conclusion that the company’s main entrepreneurial decisions were taken in South Africa and that its central administration was centred, both formally and in reality, in South Africa.

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