The recognition and enforcement of foreign judgments in the UK is going to be one key area affected by Brexit. At present, the Recast Brussels Regulation applies to this area of law. This Regulation provides that, except in very limited circumstances, if a judgment is enforceable in the EU member state within which it was handed down, it is enforceable in any member state.
This reciprocal method of enforcement avoids the need for fresh proceedings to be commenced in every member state in which a judgment creditor wishes to enforce. As the Recast Brussels Regulation relies on reciprocity across EU member states, it will cease to have effect once the UK has left the European Union.
The Government currently has a draft deal that is being considered by Parliament. If it is approved, the UK will leave the EU with a deal that covers a transitional period. During this transitional period, the Recast Brussels Regulation will continue to apply.
As the Government will need to negotiate the UK’s future relationship with the EU, we don’t know what will happen at the end of the transition period, which is currently set to end in January 2021. This will depend on any agreement that can be reached between the UK and EU.
If the UK leaves the EU without a deal, the European regime of reciprocal enforcement will cease to apply to the UK from exit day, which is currently set for 31 January 2020. The Government has published statutory instruments which will, in the event of a no-deal Brexit, revoke the Recast Brussels Regulation meaning the UK will revert to the common law rules which currently apply to cross-border disputes where the European regime does not.
The common law regime is a slower and more costly process. It is not as certain or predicable as the Recast Brussels regime as a narrower class of judgments will be enforceable under it, and the grounds for challenge will be wider.
If you have a foreign judgment that you want to enforce in the UK, we recommend you act now to have this registered before exit day to avoid the uncertainty that Brexit could bring. If you’d like more information about registering a foreign judgment, don’t hesitate to contact a member of our Dispute Resolution Team.
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