If the UK leaves the EU on 29 March 2019 with ‘no deal’ then the UK will no longer be a part of the EU’s civil judicial cooperation framework.
What rules would no longer be applicable?
As a result of a ‘no deal’ Brexit, the following rules would be repealed:
The “Brussels Regulations” - these are the rules on where a case should be heard and the recognition and enforcement of civil and commercial judgments between EU countries;
The Enforcement Order, Order for Payment and Small Claims Regulations – these provide the procedures for dealing with undisputed debts and claims worth less than €5,000;
The EU/Denmark Agreement - the rules to decide where a case would be heard when it is between Denmark and EU countries and also the recognition and the enforcement of judgments between Denmark and the EU;
The Lugano Convention - which provides rules for our civil and commercial relationship with Norway, Iceland and Switzerland.
How have the UK prepared for a ‘no deal’ Brexit?
Whilst the UK would retain the Rome I and Rome II rules on applicable law, the rules governing jurisdiction and enforcement of judgments between EU Member states will no longer apply to the UK after Brexit. In preparation of the possibility of a “no deal” new legislation has been passed, being The Civil Jurisdiction and Judgments (Hague Convention on Choice of Court Agreements 2005) (EU Exit) Regulations 2018. This legislation was required because the UK was only a member of the Hague Convention on Choice of Court Agreements 2005 because of our EU Membership and so it will be necessary for us to re-join in our own right. These Regulations, therefore, will only apply in the event of a ‘no deal’ Brexit and will come into force on 1 April 2019.
Re-joining the Hague Convention will mean that agreements containing an exclusive jurisdiction clause will fall within the Convention regime and so will continue to be upheld after Brexit and so related judgments would be enforceable in the UK, the EU (including Denmark), Singapore, Mexico and Montenegro.
What about the Lugano Convention?
The position is not so straightforward in relation to continuing to participate in the Lugano Convention which contains rules on jurisdiction and the enforcement of judgments that go beyond the Hague Convention (e.g. cases where there is no jurisdiction clause). The contracting parties of the Lugano Convention are not only EU Members but also Iceland, Norway and Switzerland. The UK has stated that its aim will be to re-join after Brexit but it cannot simply re-join the Lugano Convention in the manner as it can the Hague Convention. The UK will need to apply and will only be invited to become a party to the Convention if the other contracting parties unanimously agree.
Following a ‘no deal’ Brexit, the UK will need to rely upon either the Hague Convention on Choice of Court Agreements 2005 where that applies or failing which, we will need to revert to our own domestic and common laws in dealing with cross border issues.
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.
If you have any questions relating to this article or cross border queries or disputes or debts which have a cross border issue you would like to discuss, please contact Rachel Brown on [email protected]