Cross-border companies and their lawyers will lament the Agreement’s lack of long-term alternatives to existing rules on jurisdiction and enforcement of judgments in civil and commercial matters.
However, not everything changes on 1 January 2021.
In the short term, some provisions continue to apply:
- The EU-UK Withdrawal Agreement of 2019 gave effect to some provisions of the Brussels I (Recast) Regulation. These will continue to apply as between the EU and the UK in respect of procedures started before 1 January 2021 and, for enforcement matters, to judgments rendered in proceedings instituted before that date. So will the Rome I and II regulations on applicable law in contractual and non-contractual matters, for contracts concluded or events occurring before 1 January 2021.
- The Lugano Convention continues to apply between the UK and non-EU members, most notably Switzerland, in relation to procedures started before 1 January 2021. See here the acknowledgment of the Swiss Federal Department of Justice regarding the continued application of the Lugano Convention to the enforcement of judgments rendered before 1 January 2021.
- Some bilateral agreements between the UK and individual EU Member States predating the Brussels Regime may become relevant again.
In the longer term:
- The UK has applied on 8 April 2020 to independently re-join the Lugano Convention. Accession is subject to approval by the EU, Iceland, Norway and Switzerland (the latter three having already approved the application). Once the UK re-joins, this will re-establish jurisdictional and enforcement rules similar (though not identical) to those existing before Brexit.
- The UK has acceded to the Hague Convention on Choice of Court Agreements independently from the EU on 1 January 2021. Exclusive jurisdiction clauses in favour of UK courts should lead to judgments enforceable under the Convention in other ratifying states (the EU and its Member states, including Denmark; Mexico; Montenegro; and Singapore. China and the United States have signed but not yet ratified the Convention).
And as always:
Commercial arbitration remains largely unaffected by Brexit. The UK and EU Member States, as well as Switzerland, are parties to the New York Convention in their own right. Many have judiciaries that are firmly in favour of commercial arbitration. Arbitration therefore remains a safe choice for UK-based parties and their continental counterparts.