No-deal Brexit will cause uncertainty for cross-border litigants, says MoJ

Brexit: Domestic rules would come to the fore

The government has outlined the uncertainty that a no-deal Brexit would cause in civil cases that involve EU countries.

“We will seek to provide legal certainty for businesses, families and individuals who are involved in ongoing cases on exit day,” according to Ministry of Justice (MoJ) guidance issued today.

“Broadly speaking, cases ongoing on exit day will continue to proceed under the current rules.

“However, we cannot guarantee that EU courts will follow the same principle, nor that EU courts will accept or recognise any judgments stemming from these cases.

“Individuals with cases in progress on 29 March are encouraged to seek legal advice on how this may affect them.”

The guidance said that, in the event of a no-deal scenario, the government would repeal most of the existing civil judicial cooperation rules – including Brussels Ia, which provides rules to decide where a case should be heard when it raises cross-border issues between the UK and other EU countries, and the recognition and enforcement of civil and commercial judgments between EU countries.

It would instead use the domestic rules which each UK legal system currently applies in relation to non-EU countries.

“Businesses, individuals and legal practitioners would need to consider how these rules interact with the domestic rules of relevant EU countries to determine how jurisdiction in cross-border disputes should be established and whether any judgments should be recognised and enforced,” the guidance said.

“In certain cases, the interaction between these rules may not be clear and certain countries may not recognise judgments from UK courts. Businesses and individuals may wish to take legal advice about how these changes may affect your individual circumstances.”

The MoJ would retain elements of the current EU rules in some specific areas, where they either did not rely on reciprocity to operate or where they currently formed the basis for existing domestic or international rules.

“We would also continue to apply existing international agreements, such as the Hague Conventions, which in many areas provide alternative rules covering the same areas as the EU-specific instruments, although they are not always as comprehensive.”

The UK currently participates in the 2005 Hague Convention on Choice of Court Agreements and the 2007 Hague Convention on Maintenance because of its EU membership.

“We would make the necessary arrangements to continue to participate in these international agreements in our own right,” the MoJ said.

All parts of the UK would retain the Rome I and Rome II rules on applicable law in contractual and non-contractual matters, which generally do not rely on reciprocity to operate.

“This would ensure that businesses and individuals could generally continue to use the same rules as at present to determine which law would apply in cross-border disputes.”

The guidance also covers insolvency and family matters, and said the MoJ would repeal the EU Service Regulation and the Taking of Evidence Regulation, which cover both civil and family matters and rely on reciprocity to operate.

“However, we would apply the equivalent Hague Conventions in this area, to which the vast majority of EU countries are party. Finally, we would repeal the legislation implementing the Mediation Directive and the Legal Aid Directive.”

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