Now that Brexit is back at the top of the agenda, the enforcement of UK judgments abroad is coming back into focus. At present, enforcement in the EU isn’t too much of an issue because the UK is party to international agreements governing cross-border enforcement, but the UK is party to many of these international agreements by virtue of its membership of the EU, so leaving changes things and brings with it new challenges for enforcing judgments in the EU and beyond.
The prospect of “no-deal” is a possibility, and this makes the landscape even more uncertain. There are no guarantees that an English judgment will be enforceable against an international opponent. In the event of a no-deal Brexit, and if the UK does not immediately re-join the relevant international agreements in its own right, enforcement will be subject to local rules and may, for example, require compliance with particular local procedures, or could even be barred altogether.
Current indications from the government are that it intends to avoid any scenario where the UK is not a signatory to the relevant international agreements for any period. However, given the current uncertainty, careful consideration and strategic planning are required whether you have obtained your judgment, are involved in ongoing litigation or are contemplating commencing a claim.
Be warned: there is also some uncertainty about whether the relevant international treaties will apply where a disputed agreement was entered into when the UK was a party only by virtue of its membership of the EU.
Depending on the terms of the withdrawal agreement, matters are likely to be more straightforward in the event that the UK leaves with a deal, particularly in relation to enforcement in EU countries.
If the deal is in terms of the current draft of the withdrawal agreement and court proceedings are commenced before the end of the transition period, the current rules will apply, and English judgments will be enforceable in EU countries. If the UK leaves with a deal, but court proceedings are commenced after the end of the transition period, the enforceability of any judgment will depend on a variety of factors, including the terms of any international agreements that the UK enters into during the transition period.
It is essential to plan ahead before you enter into any international contracts, particularly following exit day. Preventative steps can be taken, for example, by ensuring that any agreements you are entering now are drafted to protect you as robustly as possible. We have a wide range of expertise in relation to international agreements and disputes and would be happy to assist you whether you are considering taking protective measures, or if a dispute has regrettably already arisen.