The Consequences Of Brexit For Judicial Cooperation In Civil And Commercial Matters Since January 1, 2021

• Published date: 22 June 2021
• Subject Matter: Government, Public Sector, Litigation, Mediation & Arbitration, Constitutional & Administrative Law, Arbitration & Dispute Resolution
• Law Firm: Friedrich Graf von Westphalen & Partner
• Author: Gerhard Manz and Barbara Mayer

Following the expiry of the transitional period agreed upon in the Withdrawal Agreement between the EU and the UK, the Brussels Ia-/EuGV-Reg (Regulation on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters "EuGVVO") will no longer apply to proceedings relating to the UK as of January 1, 2021: The UK has become a third country. Therefore, the uniform jurisdiction rules, automatic recognition of judgments, and their enforcement without separate proceedings are a thing of the past. Since the EU-UK Trade and Cooperation Agreement ("TCA") lacks any provision on judicial cooperation in civil matters between the EU and the UK, a "mini-hard Brexit" has occurred in this area. In the future, a potpourri of multilateral and bilateral treaties as well as the respective national law will apply. However, under German civil procedure law, the UK will also be treated as a third country from now on. Consequently, the defendant can demand a British plaintiff to provide security for litigation costs according to Section 110 of the German Code of Civil Procedure (ZPO).

1. Proceedings before ordinary courts

a) Multilateral Agreements

(1) Hague Convention on Choice of Court Agreements (HCCA)

If the parties are merchants and have concluded a choice of court agreement, the rules of the HCCA apply. Until March 31, 2019, the HCCA applied to the UK as an EU member state. As of 1 April 2019, the UK accedes to the HCCA in its own name, provided the UK becomes a non-EU member state through Brexit. Contracting states of the HCCA are obliged to recognize agreements on jurisdiction between merchants. Furthermore, they recognize to enforce these judgments in a simplified procedure. In Germany, the enforcement of a judgment issued in the UK is specifically governed by the Act on the Execution of Intergovernmental Treaties and the Implementation of European Union Agreements in the Field of Recognition and Enforcement in Civil and Commercial Matters ("AVAG"): Since an application by the enforcement creditor suffices, no separate recognition and enforceability judgment is required. The competent regional court then decides on the issuance of the enforcement clause without hearing the enforcement debtor. However, the HCCA has a limited scope of application: it only applies to merchants and excludes some disputes, such as inheritance or antitrust (competition) matters or claims arising from rent and lease.

(2) Lugano Convention

The Lugano Convention...