In his speech at the annual Mansion House dinner for judges last week, Lord Thomas of Cwmgiedd urged ministers to work faster to ensure that UK and EU court judgments are mutually recognised and enforced after Brexit.
Protecting the UK as an international legal centre
He was very clear that this is essential to protect Britain’s £25.7 billion a year legal industry and its position as an international legal centre. He said that the City and legal profession will suffer without a simple and flexible mutual agreement regime post-Brexit.
This is becoming a key Brexit battleground, with remainers and soft Brexiters wanting to ensure businesses trading with the EU are operating on equal terms, with hard Brexiters wanting total freedom from the Luxembourg-based European court of justice.
On 29th June 2017, the EU published interim arrangements on applicable law, jurisdiction and enforcement of judgments post Brexit.
The European Commission Position Paper on Judicial Cooperation in Civil and Commercial Matters indicates that current rules with regards to law and jurisdiction will continue to apply to contracts and proceedings in effect prior to the withdrawal date.
The paper also states that current provisions for the recognition and enforcement of judgments should continue as they are up to the withdrawal date.
Currently, enforcement of a judgment against a debtor based in the EU is very straightforward. Enforcement used to be carried out under a EEO (European Enforcement Order), which allows the court to treat the judgment as if it had been issued in their jurisdiction. Since January 2015, an EEO is no longer required.
Post Brexit enforcement
But what comes after Brexit? The EU paper covers a number of matters that will need to be included within the Withdrawal Agreement, including the:
- Jurisdiction and enforcement of judgments in civil/commercial matters (Regulation (EU) No 1215/2012 and Regulation No 44/2001)
- Recognition of judgments in the "European small claims procedure" (Regulation (EC) No 861/2007)
- European payment order (Regulation (EC) No 1896/2006)
- European enforcement order for uncontested claims (Regulation (EC) No 805/2004)
It is likely that there will be some procedure in place; the question is how simple and flexible that may be. We do hope Lord Thomas’ plea for speedy action is heeded.
David is an authorised High Court Enforcement Officer and our Director of Corporate Governance