Guidance

Cross-border civil and commercial legal cases: guidance for legal professionals

Published 31 December 2020

Applies to England and Wales

© Crown copyright 2020

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This publication is available at https://www.gov.uk/government/publications/cross-border-civil-and-commercial-legal-cases-guidance-for-legal-professionals/cross-border-civil-and-commercial-legal-cases-guidance-for-legal-professionals

This guidance only relates to cases involving the courts of England and Wales. If you have a cross-border case relating to the courts in Scotland or Northern Ireland, you should seek advice on gov.scot or justic-ni.gov.uk.

Note that the following have been amended with effect from 11pm on 31 December 2020 to ensure in particular that their provisions are consistent with Title VI of the Withdrawal Agreement.

Note also that the Private International Law (Implementation of Agreements) Act 2020 contains provisions giving legal effect in domestic law to the 2005 Hague Convention on Choice of Court Agreements and amending the Civil Jurisdiction and Judgments (Hague Convention on Choice of Court Agreements 2005) (EU Exit) Regulations 2018 (SI 2018/1124), which came into force at the end of the Transition Period.

The EU Commission have published guidance on cross-border civil and commercial legal cases.

1. Jurisdiction and recognition and enforcement of judgments

1.1 Cases in England and Wales

The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 (SI 2019/479), which came into force at the end of the transition period (11pm on 31 December 2020), set out a number of amendments to legislation in the field of civil judicial cooperation in civil and commercial matters, including rules of jurisdiction and recognition and enforcement of judgments. They also revoked the Brussels Ia Regulation and its predecessors as they applied in the UK and extinguished the effect of the Lugano Convention 2007 and the EU-Denmark Agreement in the UK. The Regulations have been amended by two further instruments (SI 2020/1493 and SI 2020/1574) in order to align the existing savings provisions with the requirements of Title VI of the Withdrawal Agreement. The amended 2019 Regulations also include savings provisions that have the effect of preserving the 2007 Lugano Convention (and the 1968 Brussels Convention) for cases that were ongoing at the end of the transition period.

The 2005 Hague Convention on Choice of Court Agreements still applies to the UK (without interruption) from its original entry into force date of 1 October 2015. It was given the force of law in domestic law on 1 January 2021 by the Private International Law (Implementation of Agreements) Act 2020, which also amended the Civil Jurisdiction and Judgments (Hague Convention on Choice of Court Agreements 2005) (EU Exit) Regulations 2018 (SI 2018/1124).

Transitional cases in England and Wales

The treatment of transitional cases (where proceedings commenced before the end of the transition period) is governed by:

  • for cases under the Brussels 1a Regulation and its predecessors and the EU-Denmark Agreement, Articles 67 and 69 of the Withdrawal Agreement
  • for cases under the Lugano Convention, regulation 92 of the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019.

Both Article 67 (and 69) and regulation 92 provide that courts in England and Wales will continue to apply the relevant EU rules on jurisdiction and recognition and enforcement of judgments which applied immediately before the end of the transition period (e.g. as appropriate, those of Brussels Ia and the Lugano Convention) to cases where the proceedings were commenced before the end of the transition period. Article 67 (and 69) and regulation 92 also provide that courts in England and Wales will continue to apply the EU rules on recognition and enforcement which applied immediately before the end of the transition period (e.g. those of Brussels Ia and Lugano respectively) where the parties have concluded a court settlement, or formally drawn up or registered an “authentic instrument”, before the end of the transition period, and recognition and enforcement is sought after that date in England or Wales.

Both Article 67 and regulation 92 include judgments delivered, whether before or after the end of the transition period, by a court in the UK or an EU member state in proceedings commenced before the end of the transition period, but which have not been enforced in an EU member state or the United Kingdom respectively before the end of the transition period. Exclusive choice of court agreements entered into from 1 October 2015 which choose a UK court or the court of an EU member state for the resolution of disputes, will continue to be subject to the terms of the 2005 Hague Convention on Choice of Court Agreements.

New cases in England and Wales

The rules governing jurisdiction in all cross-border disputes, including those involving parties domiciled in the EU (or in other states party to the Lugano Convention 2007), are derived from the domestic law of each UK jurisdiction. In England and Wales, that comprises the common law, together with various statutory provisions including, in particular, Part 6 of the Civil Procedure Rules 1998 (notably Practice Direction 6B). For consumer and employment claims – some specific provision on jurisdiction is made in sections 15B to 15E of the Civil Jurisdiction and Judgments Act 1982.

For claims initiated after the end of the transition period, involving an exclusive choice of court agreement entered into from 1 October 2015, in which the chosen court is established in a contracting party to that Convention (which includes all EU member states), the rules of the Hague Convention 2005 on Choice of Court Agreements) apply. The rules governing recognition and enforcement of foreign judgments in cross-border disputes are generally contained in the common law unless there is a bilateral agreement in force with the relevant country on reciprocal recognition and enforcement of judgments. In the case of judgments arising from exclusive choice of court agreements within scope of the 2005 Hague Convention, the Convention rules apply.

1.2 Cases in an EU member state

The treatment of transitional cases by EU member state courts is governed by Title VI, Part 3 of the Withdrawal Agreement.

The EU Commission have published guidance on cross-border civil and commercial legal cases, including on the approach that EU member states will take regarding exclusive choice of court agreements choosing UK courts concluded since 1 October 2015.

1.3 Potential accession to the Lugano Convention

On 8 April 2020, the Government applied for the UK to rejoin the Lugano Convention as an independent contracting state. It is now waiting for the other contracting parties to decide whether to agree to the UK joining the Convention. This guidance will be updated if the UK is able to rejoin this Convention with details of what this will mean for jurisdiction and the recognition and enforcement of judgments in cases to which the Convention applies and confirmation of the date from which this will be effective.

2. Special European procedures

Under EU law, the following three EU Regulations dealt with cross-border civil and commercial claims, providing procedures for obtaining and/or enforcing orders or judgments in certain types of claims:

Legislation dealing with the EEO, EOP and ESCP Regulations is contained in the following statutory instrument: the European Enforcement Order, European Order for Payment and European Small Claims Procedure (Amendment etc.) (EU Exit) Regulations 2018 (SI 2018/1311). This instrument revoked the retained EEO, EOP and ESCP Regulations and variously revoked and amended related EU amending measures and domestic legislation (other than the relevant court rules). The European Enforcement Order, European Order for Payment and European Small Claims Procedure (Amendment etc.) (EU Exit) Regulations 2018 (SI 2018/1311), were amended with effect from 11pm on 31 December 2020 to ensure in particular that their provisions are consistent with Title VI of the Withdrawal Agreement.

2.1 Transitional cases

Article 67 of the Withdrawal Agreement provides that:

  • the EEO Regulation still applies to judgments given in legal proceedings instituted before the end of the transition period, and to court settlements approved or concluded and authentic instruments drawn up before the end of the transition period, provided that the certification as a European Enforcement Order was applied for before the end of the transition period;
  • the EOP Regulation still applies to European payment orders applied for before the end of the transition period. Where, following such an application, the proceedings are transferred according to Article 17(1) of the EOP Regulation, the proceedings shall be deemed to have been instituted before the end of the transition period;
  • the ESCP Regulation still applies to small claims procedures for which the application was lodged before the end of the transition period.

2.2 New Cases

From the end of the transition period, the European Enforcement Order, European Order for Payment and European Small Claims Procedure (Amendments etc.) (EU Exit) Regulations 2018 (SI 2018/1311) mean that:

  • EEOs, EOPs and ESCP judgments issued by EU member state courts are no longer recognised or enforceable in the UK; and
  • UK courts are unable to certify judgments as EEOs, issue EOPs or ESCP judgments. Claims which would have been capable of being pursued in the UK under the EOP or ESCP Regulations prior to the end of the transition period need to be made in the appropriate court as ordinary civil claims.

The EU Commission have published guidance on cross-border civil and commercial legal cases.

3. Applicable law

3.1 Cases in England and Wales

The EU rules governing applicable law in civil and commercial cases in the UK and EU member states before the end of the transition period can be found in the following EU instruments and agreements:

  • for contractual obligations, Regulation (EC) No 593/2009 (the Rome I Regulation) applies to contracts entered into from 17 December 2009; the 1980 Rome Convention on the law applicable to contractual obligations applies to contracts entered into between 1 April 1991 and 16 December 2009);
  • for non-contractual obligations, Regulation (EC) No 864/2007 (the Rome II Regulation) applies to events giving rise to damage which occurs after 11 January 2009.

Legislation dealing with the “Rome” rules on applicable law is contained in the following statutory instrument: The Law Applicable to Contractual Obligations and Non-Contractual Obligations (Amendment etc.) (EU Exit) Regulations (SI 2019/834). This instrument amended the Rome I and Rome II Regulations as retained by the EU Withdrawal Act 2018 so that they operate effectively as domestic law and made amendments to other related legislation.

This statutory instrument also preserves and amends the Rome Convention Rules, which are set out in the Contracts (Applicable Law) Act 1990, so that they still apply to contracts entered into between 1 April 1991 and 16 December 2009. This SI has been amended by The Jurisdiction, Judgments and Applicable Law (Amendment) (EU Exit) Regulations 2020 (SI 2020/1574) to ensure in particular that its provisions are consistent with Title VI of the Withdrawal Agreement.

Cases in England and Wales

Article 66 of the Withdrawal Agreement provides that:

  • the Rome I Regulation (Regulation (EC) No 593/2008 of the European Parliament and of the Council) continues to apply in respect of contracts concluded before the end of the transition period;
  • the Rome II Regulation (Regulation (EC) No 864/2007 of the European Parliament and of the Council) shall apply in respect of events giving rise to damage, where such events occurred before the end of the transition period.

For contracts concluded, or where an event giving rise to damage occurs, after the end of the transition period, the retained Rome I and Rome II Regulations (and, for relevant old contracts, the Contracts (Applicable Law) Act 1990) as amended by the Law Applicable to Contractual Obligations and Non-Contractual Obligations (Amendment etc.) (EU Exit) Regulations 2019 (which was further amended by SI 2020/1574) applies to determine applicable law in relation to contractual or non-contractual obligations. The retained versions of Rome I and Rome II Regulations also apply to determine applicable law in the case of intra-UK conflicts of laws (or conflicts of laws between the UK and Gibraltar), where the contract is concluded, or the events giving rise to the damage occurred, before the end of the transition period.

3.2 Cases in an EU member state

Article 66 of the Withdrawal Agreement provides that, in EU member states (in cases involving the UK):

  • the Rome 1 Regulation continues to apply in respect of contracts concluded from 17 December 2009 (including after the end of the transition period); and
  • the Rome 2 Regulation applies in respect of events giving rise to damage, where such events occurred on or after 11 January 2009 (including after the end of the transition period).

Practitioners should note, however, that both the Rome I and Rome II Regulations apply whether or not the applicable law is the law of an EU member state or not (see Article 2 of Rome I and Article 3 of Rome II).

For more information, please consult the EU Commission’s guidance.

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