London has long enjoyed a reputation as one of the most popular and trusted arbitral seats in the world. The reasons for this deserved reputation have never depended on membership of the EU.
The most important features of an arbitral seat are:
- respect for the rule of law
- domestic arbitration legislation which is modern, comprehensive and clear, which respects the parties’ choice of arbitration, provides a framework for resolving a dispute by arbitration, limits the scope for judicial intervention and mandates the recognition and enforcement of arbitral awards in accordance with international treaties.
- a highly experienced, independent and efficient judiciary with an established pedigree of respecting the arbitral process and enforcing arbitral awards including those rendered overseas
- a respected, experienced and dynamic local bar governed by the highest standards of ethical conduct.
- the ability of parties to be represented in arbitration by lawyers from anywhere in the world
- safety, accessibility and infrastructure.
London has all of these important qualities. None requires membership of the EU. Other leading centres for international arbitration, including Hong Kong and Singapore and those in Switzerland have thrived wholly outside of the EU.
For international arbitration, it is the New York Convention that is our most important legal infrastructure. That global treaty, which allows for the recognition and enforcement of arbitral awards in over 150 countries, does not depend on membership of the EU. Awards rendered in London will continue to be enforceable in other New York Convention jurisdictions, including in the EU Member States, regardless of Brexit. The key European instrument on jurisdiction and enforcement issues in civil and commercial matters, the Brussels Regulation, does not apply to commercial arbitration. Arbitration agreements concluded pre-Brexit providing for arbitration in London will, therefore, continue to be binding and enforceable. The English courts will intervene to restrain proceedings brought in breach of an arbitration agreement, even where no arbitral proceedings are contemplated (Ust-Kamenogorsk Hydropower Plant JSC v AES Ust-Kamenogorsk Hydropower Plant LLP 2013 UKSC 35).
The English Arbitration Act is now in its 20th year. It provides a tried-and-tested framework for international arbitration. Brexit will not affect that framework. The (truly) international arbitral community based in London will remain committed to preserving London’s standing as a leading arbitral seat and to delivering world-class services that remain relevant to end users of arbitration.
Whilst the wider impact of Brexit remains to be seen, the legal consequences for London arbitration are known and they are negligible if not non-existent. Overseas parties and counsel attending hearings in London post-Brexit should see no impact on their London cases (besides, for now at least, some very favourable exchange rates).
The message from London arbitration is therefore clear: keep calm, and keep choosing London.