The progressive expansion of digital financial services and platforms based on blockchain technology has put one of the classic pillars of law in crisis: territoriality.
Given this new paradigm, The National Chamber of Commercial Appeals recently issued a momentous resolution confirming the jurisdiction of the Argentine courts in a lawsuit filed against the digital financial entity Xapo Bank Limited, based in Gibraltar.
This decision consolidates a legal solution anchored in the protection of consumer rights, marking a jurisprudential milestone for international electronic commerce.
The millionaire dispossession and the beginning of the conflict
The case dates back to February 16, 2022, when the Argentine lawyer Carolina Biquard suffered the theft of her cell phone. Two weeks later, on March 1, when he managed to log into his account again in “Xapo Bank” confirmed the existence of two unauthorized transfers of crypto assets that completely emptied its funds: one for 5.00000911 bitcoins and another for 0.76570611 BTC.
These assets were directed to an unknown address that immediately generated a “transaction tree”thus consolidating the virtual dispossession of the user.
Given the desperate claim of the victim, The company disclaimed any type of operational responsibility, stating “that there had been no security breach in XAPO’s systemswhich meant that no further action on his part was possible.”
As a result of this refusal, Biquard filed a lawsuit for annulment of the legal act and compensation for $30,000,000 yu$262,484.18 against the entities Xapo Bank Limited and Xapo Vasp Limited.
The corporate evasion strategy
Faced with judicial action, The defendant companies, both domiciled in Gibraltar, quickly raised an objection of incompetence.
They argued that the link was formed through a “reverse request” driven by the user herself, and that The firm does not have subsidiaries, branches nor does it carry out any advertising activity within the territory of the Argentine Republic.
Based on this, they affirmed that the relationship should be governed exclusively by the “Terms and Conditions” accepted electronicallywhich stipulated that any controversy must be submitted to an arbitration procedure in accordance with local regulations, specifically under the Arbitration Act 1985 of Gibraltar.
Additionally, the entities denied the existence of a consumer relationship and argued that, under the directive of article 2655 of the Civil and Commercial Code of the Nation (CCCN), the law of the consumer’s domicile would only be applicable if there were cumulative connections that also protect the rights of the company providing the service.
Local Justice, in favor of the user
Chamber A of the Court of Appealsmade up of judges Héctor Osvaldo Chomer and Alfredo A. Kölliker Frers, It overturned the multinational’s claims and ratified the first instance ruling.
The Court highlighted that consumer regulations constitute a matter that is not available to the parties.based on public order provisions that enjoy undisputed constitutional status.
The judges analyzed the modality of the contracts known as “Click and Wrap Agreements”in which the general agreement is “wrapped” in the structure of the digital platform and consent is given with a simple “click”“, preventing any real margin for an equal negotiation between the participants.
The Chamber concluded that, given that the plaintiff resides in the City of Buenos Aires, it was reasonable to presume that “the provision of information and the ‘clicking’ that allowed it to carry out these operations was carried out through the application of the defendants downloaded on the plaintiff’s smartphone or through the website using a computer, precisely in this jurisdiction.”
Therefore, based on article 2654 of the CCCN – which expressly prohibits choice of forum agreements in consumer matters -, The judges declared the full and absolute jurisdiction of Argentine commercial justice.
The expert view: asymmetry and “jurisdictional bridge”
To measure the impact of the sentencethe analysis of the lawyer and founder of the consulting firm SGS World Ariel Aginsky in Diario Judicial is key.
The specialist unravels how the decentralization of blockchains dissolves traditional territorial criteria: “Where a legal event occurs when the infrastructure is decentralized, the parties are in different countries and the operation does not have a physical place of execution?”
Regarding the extension of jurisdiction clauses, he warns that requiring the user to litigate abroad “is not only impracticable, but also distorts the right of access to justice” and makes it, in fact, illusory.
According to his analysis, The digital consumer faces a double vulnerability: technicaldue to the complexity of the system; and economical, by the dominant position of global platforms.
In this context, the court’s reasoning stands out: “The ruling thus builds a jurisdictional bridge that allows re-anchoring in the consumer’s territory, preventing technological deterritorialization translates into lack of legal protection”.
And he adds a strong warning: “Forcing a consumer to litigate in a foreign jurisdiction implies, in fact, an illegitimate restriction of the right of defense“.
In summary, he concludes: “The figure of the digital consumer is consolidated as the axis from which it is possible to reconstruct the jurisdiction and prevent technological innovation from becoming a way for the frustration of rights”.
A message for international digital platforms
The case led by Carolina Biquard against companies based in Gibraltar shows that The state framework should not be paralyzed by the apparent intangibility of the network.
Hyperconnectivity and technological globality do not imply the disappearance of national law, but the urgent need to redefine its application criteria.
After this ruling, it is clear that international digital platforms will not be able to use geographical distance as a shield to avoid responsibilities towards local consumers.
