The UK has ratified the Hague 2019 Judgments Convention

On 27 June 2024, the UK ratified the Hague Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (the “Convention”). The Convention will come into force in the UK on 1 July 2025, filling a lacuna in recognition and enforcement of foreign judgments that arose after Brexit.

In addition to the UK, EU member states (except Denmark), Ukraine and Uruguay are also Contracting States to the Convention. It is expected that the Convention will be signed and ratified by other states in the near future. To date, it has been signed, but not yet ratified, by Israel, Costa Rica, Montenegro, North Macedonia, the Russian Federation, and the USA.

The Convention provides a uniform framework for the recognition and enforcement of judgments in civil or commercial matters between one Contracting State (the State of origin) and another Contracting State (the requested State). Therefore, the Convention will better facilitate the effective recognition and enforcement of foreign judgments between the Contracting States. This is a significant and much welcomed step for the UK and its position in cross-border litigation and enforcement, especially post-Brexit. 

The effect of Brexit on the recognition and enforcement of foreign judgments

Before Brexit,  the UK benefited from the following multilateral recognition and enforcement regimes:

• The so-called “Recast Brussels Regulation”( EU Regulation No. 1215/2012), which regulates jurisdiction and recognition and enforcement of judgments in civil and commercial matters as between EU member states’ courts.
• The 2007 Lugano Convention on Jurisdiction and the Recognition and Enforcement of judgments in Civil and Commercial Matters of 21 December 2007, which regulates jurisdiction and recognition and enforcement of judgments between EU member states and Iceland, Norway and Switzerland.
• The Convention of 30 June 2005 on Choice of Court Agreements (the “Hague 2005 Convention”), which requires the courts of contracting states to give effect to qualifying exclusive jurisdiction clauses in favour of the courts of other contracting states, and to recognise and enforce judgments arising from disputes governed by those qualifying exclusive clauses.

Following Brexit and from 1 January 2021, the EU regime for the recognition and enforcement of judgments ceased to apply in the UK, leaving only the Hague 2005 Convention. The current state of play is that the enforcement of English court judgments in other countries relies on bilateral treaties, the Hague 2005 Convention, or the domestic laws in the country where recognition / enforcement is sought.  That position will change once the Convention is in force, as summarised below.

The scope of the Convention

The Convention applies to the recognition and enforcement of judgments in civil or commercial matters (Art. 1), and it is expected to complement the Hague 2005 Convention.

The Convention provides a list of criteria to be used by the courts of the requested State to ascertain whether the judgment is eligible for recognition and enforcement in that State. Article 5(1) sets out a detailed and wide-ranging list of the relevant criteria for when the Convention applies, including where a party was habitually resident in the State of origin at the time when they became a party to the proceedings in the court of origin, or there is a connection between the claim and the State of origin (e.g. place of performance of a contract or the place where the tort was committed). 

Certain subject matters are outside the scope of the Convention, such as insolvency matters, intellectual property, defamation, privacy and certain anti-trust (competition) matters (Art. 2(1)). In addition, the Convention does not apply to arbitration and related proceedings (Art. 2(3)) or interim measures of protection (Art. 3(1)(b)). Contracting States may also declare that the Convention does not apply to other specific matters, but only where a State has a “strong interest” in that matter (Art. 18(1)).

Potential grounds for refusal of recognition and enforcement

Article 7(1) of the Convention provides that the courts of a requested State may refuse to recognise or enforce a judgment on several grounds, including, but not limited to, where the defendant has not been properly notified of the proceedings; where the judgment was obtained by fraud; on public policy grounds; and where the proceedings breached a pre-existing jurisdiction agreement between the parties. These grounds for refusal are not mandatory and, therefore, the courts of the requested State will retain ultimate discretion regarding whether to refuse recognition and/or enforcement.

The practical effects of the Convention

The UK's ratification of the Convention will bring several practical benefits for parties involved in cross-border disputes. In particular, we observe that:

• The Convention applies to a wider range of judgments than the 2005 Hague Convention, which only covered exclusive jurisdiction clauses. Significantly, the Convention provides for the recognition / enforcement of a judgment where the dispute falls within a non-exclusive or asymmetric jurisdiction clause in favour of the English court as well as where there is no jurisdiction clause. 
• The wide-ranging scope of the Convention will give contractual parties more flexibility and choice to select non-exclusive or asymmetric English jurisdiction clauses in their commercial contracts. 
• Once in force in the UK, the Convention will provide greater certainty that an English court’s judgment will be recognised and enforced in other Contracting States, provided the judgment meets the eligibility criteria detailed in the Convention.
• The Convention will simplify and expedite the recognition and enforcement of English judgments in Contracting States, as it provides for a streamlined procedure and a limited set of grounds for refusal. This will reduce the time and costs of recognition and enforcement and increase the likelihood of recovery following a successful judgment.
• As a result of all of the above, the Convention serves to further enhance the attractiveness and competitiveness of the UK as a jurisdiction for international disputes. 

The challenges that may arise from the Convention

That said, we observe that the intricate details of when the Convention is applicable may give rise to the following challenges in the future:

• The Convention only applies to judgments where, at the time the proceedings were commenced in the state of origin, the Convention had effect between that State and the requested State. Therefore, the application  of the Convention will depend on when each State ratifies the Convention. As noted above, to date, the UK, EU member states (except for Denmark), Ukraine and Uruguay have ratified the Convention.
• There is an opt-out process, such that when a state deposits its instrument of ratification/acceptance it can choose to opt out of the Convention’s application between it and any other Contracting State. Furthermore, each Contracting State also then has a 12-month period to decide whether the Convention will or will not apply as between it and the joining state (Art. 29(2) and (3)). As a result, there remains a possibility for the EU member states to declare in the next 12 months that the Convention should not apply to their relations with the UK. We consider that possibility to be more theoretical than real, but only time will tell.

Comment

By setting common accepted conditions for recognition and enforcement of judgments, as well as agreed grounds for refusal to recognise and enforce judgments, the Convention provides legal certainty to parties involved in cross-border transactions and reduces recognition / enforcement timeframes, costs and risks in cross-border cases. This is a significant development and was much needed following the cessation of the EU-wide recognition and enforcement regimes in the aftermath of Brexit, and after the UK was refused consent to independently accede to the Lugano Convention in May 2021.

By ensuring the recognition and enforcement of foreign judgments, the Convention enhances access to justice in a real and tangible manner. This allows claimants to make informed decisions about the jurisdiction clauses in their contracts and, if a dispute ensues, about where to commence proceedings based on where a judgment will be recognised and enforced.

The full text of the Convention is available here.