In September, the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (the 2019 Judgments Convention) came into force between the first two parties – the EU (encompassing all of the EU member states other than Denmark) and Ukraine. As discussed in our earlier article on this development, the results of a UK government consultation on the 2019 Judgments Convention were eagerly awaited towards the end of 2023 to provide further details. If adopted by the UK, the 2019 Judgments Convention will "provide a set of common rules for the recognition and enforcement of civil and commercial judgments between the UK and the other Contracting Parties, including the EU".
The results of that consultation have now been published. In this brief update, we discuss the proposed approach of the UK Government following the consultation, the key issues being addressed and what to expect in terms of implementation.
What is the outcome of the consultation?
In what is anticipated to be positive news for the UK, the consultation and proposed approach of the UK Government is for the UK to become party to the 2019 Judgments Convention (with the intention being for the UK to sign up "as soon as practicable"). Following feedback from major UK firms, universities and industry bodies, it has been recognised that the UK joining the 2019 Judgments Convention would "benefit both businesses and consumers operating and living across borders, between the UK and other countries" and "provide assurance that UK judgments in scope will be recognised and enforced in current and future Contracting Parties to the Convention, and vice versa, which will in turn encourage trade and investment." It was also recognised that the 2019 Judgments Convention has a role to play (especially given that the EU is a party, and the United States has signed and is expected to ratify shortly) in promoting the UK as a "preferred forum for dispute resolution".
What are the key issues being addressed?
While consultation respondents highlighted a number of potential downsides – including the risk of UK courts being forced to recognise and enforce foreign judgments where they otherwise would not have been required to do so, particularly judgments from states where there are concerns in respect of procedural fairness and the rule of law – it's noted that:
- these potential downsides are guarded against through a number of protections and safeguards within the 2019 Judgments Convention framework; and
- on balance, the downsides are outweighed by the benefits gained.
Interestingly, the consultation response expressly recognises one concern raised by a number of practitioners in the post-Brexit period (since the UK lost access to the Brussels and Lugano regimes), namely that the 2019 Judgments Convention is more limited in scope. However, the UK Government's response is that the 2019 Judgments Convention is "the right choice for the UK at this time" and joining that convention "does not prevent the UK joining the Lugano Convention in future" (although, given that the UK previously applied to do so and was rejected, the decision to join is not directly within its control).
What happens next?
Given the strength of positive sentiment, which is apparent across the consultancy respondents and in the Government's approach, the UK's ascension to the ranks of the 2019 Judgments Convention members will hopefully be swift, and bring with it a new degree of certainty in certain international matters. We will keep you updated.
To discuss any of the points raised in this article, please contact Sean Adams or Tom Price.