Brexit and the Impact on Foreign Judgments
As Brexit negotiations continue to be ever present in the headlines, it is a timely reminder for parties contemplating litigation or with concluded cases to consider the impact Brexit will have on enforcing judgments in the UK or abroad.
There are currently four regimes for the enforcement of foreign judgments in England and Wales:
- The UK Regime for judgments in Scotland or Northern Ireland
- The European Regime for judgments from EU and certain EFTA countries
- The statutory regime for judgment in most commonwealth countries
- The common law regime for judgments in other countries (for example the USA)
In this blog, we focus primarily on the European Regime and how this will be affected by Brexit. Under the European Regime, English judgments are currently enforceable in all EU member states. Depending on when Court proceedings began, parties can rely on:
- The Recast Brussels Regulation (Council Regulation (EU) 1215/2012) on jurisdiction and the recognition of judgments in civil and commercial matters for proceedings commenced on or after 10 January 2015; or
- The 2001 Brussels Regulation (Council Regulation (EU) 44/2001) on jurisdiction and the recognition of judgments in civil and commercial matters for proceedings commenced on or before 10 January 2015.
The Recast Brussels Regulation in particular creates an enforcement procedure which is less time consuming, less costly and enables parties to enforce judgments across the EU regardless of the origin member state in which the dispute arose. A wide range of judgments are enforceable (not just money claims) and there are limited grounds to refuse enforcement. The objective was so that enforcement of foreign judgments across EU member states was a straight forward process.
Post Brexit, the enforceability of English judgments across the EU and vice-versa may be a far more time consuming and costly exercise. Subject to any transitional period, the Recast Brussels Regulation will no longer apply and will be subject to the rules each country applies to the enforcement of non-EU judgments which could be complex, time-consuming and expensive.
What happens next?
There will be a degree of uncertainty until Brexit talks are finalised and the UK moves into a transitional period. The Government may decide to adopt a similar agreement to the 2007 Lugano Convention, which applies to EFTA States (except Liechtenstein) i.e. Iceland, Norway and Switzerland, and is broadly similar to the Recast Brussels Regulation. The UK could also try to remain a part of the existing Recast Brussels Regulation; although there is serious doubt as to whether the EU will agree to this.
Our advice is to act now if you have an English judgment that you wish to enforce in the EU. We have extensive experience in dealing with the registration and enforcement of foreign judgments in the UK and in the EU. If you would like more information on the enforcement of foreign judgments, please contact Hailey Nip on 01905 744 887 or email her at firstname.lastname@example.org