The effect of a no-deal Brexit will be felt in different ways by EU litigants depending on the stage in which they find themselves in proceedings. As time ticks on and the possibility of no deal continues to increase, what questions should litigants be asking themselves?
A no-deal Brexit has the potential to have a significant effect on cross-border civil and commercial litigation in the EU as in that scenario the UK’s participation in the Brussels and Lugano regimes will cease. These instruments govern jurisdiction and enforcement of judgments in civil and commercial matters in the EU and certain EFTA states and the UK’s participation depends upon its status as an EU Member State. The UK has taken some legislative steps to address this deficit while the European Commission has published a notice outlining how it sees matters unfolding within the EU.
Can I enforce a judgment already obtained in proceedings?
Under the draft Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019, the UK has indicated that it will continue to enforce judgments given in other EU and relevant EFTA states where the proceedings were initiated before Brexit.
For its part, the EU has stated that where the relevant instrument foresees exequatur, if a judgment of a UK court has been exequatured in the EU-27 before the withdrawal date but not yet enforced before that date, the judgment can still be enforced in the EU-27. The fact that it was originally a judgment handed down by the UK courts will be irrelevant.
However, unless a judgment of a UK court has been exequatured before the withdrawal date, the EU rules on recognition and enforcement of judgments will not apply to a UK judgment, even where
- the judgment was handed down before the withdrawal date; or
- the enforcement proceedings were commenced before the withdrawal date.
In such a case, unless the Hague Choice of Court Convention 2005 applies, it will be up to individual EU Member States to apply their own national rules on the enforcement of judgments.
Is there any effect on proceedings initiated on or after the withdrawal date?
After the withdrawal date, in proceedings involving the UK, the Hague Choice of Court Convention 2005 may apply to deal with issues such as the jurisdiction of a court to hear the case and the subsequent recognition and enforcement of any judgment. If it does not, these issues will be governed by the national rules of the particular state(s) involved. In this context, it is should be noted that UK rules of private international law governing the court’s jurisdiction to hear proceedings differs from say, the Brussels regime and that national rules on recognition and enforcement of foreign judgments are typically narrower than under that regime.
What should I do if proceedings are likely but are not yet in being?
Given the issues outlined above, where proceedings which may involve the UK are contemplated but are not yet in being and in particular where it is envisaged that enforcement in the UK may ultimately be necessary, you will need to consider whether to act in advance of any no-deal Brexit. If necessary, appropriate plans should be put in place. Another option may be alternative dispute resolution.
These are some of the headline issues for EU litigants faced with the prospect of a no-deal Brexit. However, it should also be remembered that the practicalities of conducting litigation involving the UK may also be complicated if this event comes to pass. EU instruments facilitating cross-border cooperation in relation to the formalities of proving public documents, the service of proceedings and the taking of evidence are also scheduled to fall away.