The impact of Brexit on dispute resolution

On the 23rd June 2016, the voting electorate decided that they would prefer the UK to leave the European Union.

It is not yet clear when (or indeed if) notice under Article 50 of the Lisbon Treaty will be served by our government. What is clear, is the uncertainty amongst businesses of the impact on international business.

For the time being, the status quo remains. However, if you are a business involved in international trade, you may want to give some thought to the following issues:

  • If you are entering into new relationships, renewing, or renegotiating existing contracts, you should give some thought to clauses dealing with disputes and the governing law that applies to your contract. You need to give thought to which Court will have jurisdiction in the event of a dispute and which law is to govern the contract. As an alternative, arbitration may seem an attractive alternative as it is unlikely to be affected by the vote to leave and the subsequent “leaving arrangements” to be negotiated.
  • If you have a Court judgment that needs to be enforced in another EU state, you may need to act quickly to take advantage of the present enforcement arrangements we have in place, as they may change in the future.
  • At the moment, a claimant can serve proceedings on a defendant in another EU member state without having to obtain permission from the Court, provided certain conditions are met. If similar reciprocal arrangements are not negotiated with EU member states before we formally exit, this process may become longer and more expensive.

If you would like to discuss this article further, please contact Alka Kharbanda on 01494 478 611, or email alk@blasermills.co.uk. Alternatively, you can contact Sangita Manek on 020 8515 7574, or email sam@blasermills.co.uk.