Within the EU there is an almost complete legal framework for the choice of law, jurisdiction and recognition and enforcement of judgments in civil and commercial matters.
The primary goal of this legal framework is the facilitation of the recognition and enforcement of judgments reached by Member States’ courts, to achieve the so-called free movement of judgments. This is achieved by the Brussels I Regulation (Brussels I), which provides for almost automatic recognition and enforcement of judgments.
There are a few alternative approaches that could provide for continued recognition and enforcement of judgments in civil and commercial matters. These are:
- maintaining the Brussels I framework as part of the EU-UK agreement on the new relationship;
- accession to the Lugano Convention on civil and commercial matters; and
- the various conventions agreed at the Hague Conference on Private International Law.
Practitioners would prefer to maintain the application of Brussels I as part of the new EU - UK relationship. Compared with any of the aforementioned alternatives, the Regulation contains the widest variety of judgments and orders, modernised rules on jurisdiction, speediest and most efficient enforcement of those judgments. The Brussels office has in their communication, however, considered at length the alternative, which are briefly surmised below.
The Lugano Convention provides for an almost parallel system of recognition and enforcement of judgments in civil and commercial matters to Brussels I. The Convention is open to the EU and EFTA States, and any other States that are invited by the participating states to join. This could provide an alternative route to guarantee recognition and enforcement of judgments to Brussels I. However, there are two specific issues that arise in this context: Brussels I was revised as to lis alibi pendens and recognition and enforcement; and the Lugano Convention will need to be ratified by all the parties to it.
The UK Government was strongly behind the amendments when Brussels I was being revised. Therefore, the view of practitioners is that, if access to the Brussels I recast Regulation is not possible and instead the UK will choose the Lugano Convention framework, the UK should aim to include the Brussels I amendments in the Lugano Convention.
Choice of Court Agreements Convention
An important convention that the UK should consider ratifying is the 2005 Choice of Court Agreements Convention on Civil and Commercial Matters. This Convention has been ratified by the EU (2015), Mexico (2007) and Singapore (2016). The UK is therefore already a party to this convention as an EU Member State.
As a point of priority, it should be ensured that the UK will accede to the Convention, as seamlessly as possible, as the UK withdraws from the EU membership. Usually it takes three months for the ratification to enter into force. If the UK were to deposit the ratification document only at the withdrawal, it could lead to a three month period when the Convention does not applied, which again would create a wealth of uncertainty that should be avoided.
Limits of the Choice of Court Agreements Convention
The Convention provides that it applies only to those choice of jurisdiction agreements which have been concluded after its entry into force. Without a transitional arrangement with EU then, this may create a gap whereby judgments reached by UK courts on the basis of agreements concluded before the entry into force of the Convention, but after the withdrawal from the EU membership, cannot be enforced.
It should also be noted that while this Convention is very important to commercial adjudication, as it provides for a recognition and enforcement of judgments where there is an exclusive choice of court agreement between the parties to the dispute, it does not fully replace Brussels I framework. Both Brussels I and the Lugano Convention apply to all judgments in civil and commercial matters, including for example where there is a consumer, employment or insurance dispute.
Service of Documents and Taking of Evidence: Differences between EU Regulations and the Hague Conventions
Additionally, it is important to ensure that courts can continue to obtain documents and evidence from other EU jurisdictions. The agreement on the new EU-UK relationship could also include the Service of Documents and Taking of Evidence Regulations as they support the aims of the recognition and enforcement of judgments and speedy and efficient dispute settlement mechanisms.
The Hague Conference has previously adopted Conventions on the service of documents and the taking of evidence, to which the UK is already a party. Generally these Conventions have been widely ratified by the EU Member States.
Practitioners involved in the processes of serving documents and taking evidence have however highlighted that the procedures under the Conventions are more cumbersome and slower than those under the EU Regulations. This means that the proceedings are less expeditious and more costly for the parties involved.
Recognition and Enforcement of Judgments in Special Cases
As made clear above, the Hague Conference Conventions do not cover as wide a scope as Brussels I and the Lugano Convention. In particular, the latter applies also to protect the weaker parties in insurance, employment or consumer contracts, ensuring that defendants can only be sued only in their place of residence or domicile. Therefore, the Hague Conventions would not protect weaker parties domiciled or located in the UK, even if the Hague judgments project comes to fruition in the not too distant future. Accordingly, the loss of these frameworks needs to be carefully analysed.