6 December 2018
Last month the Law Society published guidance (found here) for solicitors, concerning civil and commercial cooperation between the UK and EU member states in the event of a “no deal” Brexit.
In short, in the event that the UK exits the EU’s institutional structures immediately/without a transition period, cooperation between the legal regimes of the UK and EU will cease and the applicable legal cooperation regime, such as the Brussels I Regulation etc., will no longer apply. Practitioners should therefore be mindful of the following:
- All reciprocal elements of EU law will cease to have effect although, in some cases, bilateral treaties and conventions pre-dating EU membership may exist between the UK and EU member states.
- The Brussels I Regulation will no longer apply between the UK and the EU27 meaning it would be likely that England and Wales will fall back on the pre-existing common law regime governing the recognition and enforcement of foreign judgements.
- The Insolvency Regulation will no longer apply between the UK and the EU27, and therefore an insolvency officeholder appointed in the UK would have difficulty obtaining recognition in the EU.
- The state of ongoing cases with cross-border UK and EU cooperation elements would be unclear. If the UK leaves the EU on 29 March 2019 with no withdrawal agreement in place, the rules governing the enforceability of any given case decided after that point will cease to be effective, meaning that there is a risk that it is in certain parties’ interests to commence parallel proceedings in multiple jurisdictions.
- Although not as comprehensive as EU frameworks (in respect of the set of rules they apply to civil and commercial cooperation), the UK will accede to the Hague Convention. Here, where parties have an exclusive choice of court clause in their agreement, the Hague Convention’s rules will be applied between the UK and EU/EEA states, as well as any other state signatories to the Hague Conventions.
- The Hague Convention will continue to apply in respect of Service of Documents and Taking of Evidence.
Perhaps the most important practical point to take from the guidance is that in a “no-deal” Brexit there would be marked uncertainty for parties to cross-border disputes. Legal advice should be taken, therefore, as to the implications of this scenario on a particular case.
Further down the timeline, because the national law of each EU/EEA state determines whether a foreign judgment is recognised and enforceable in that jurisdiction, there would be a question hanging over the enforceability of English judgments in the future, particularly where some EU member states simply do not presently have in place rules to recognise such foreign judgments.
On Tuesday 11 December, the House of Commons will vote on the government’s motion to approve the EU withdrawal agreement and its accompanying political declaration.