The New Hague Judgments Convention Entered Into Force

• Jurisdiction: European Union
• Law Firm: Castren & Snellman Attorneys
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution, Trials & Appeals & Compensation
• Author: Ilona Karppinen, Veera Sundberg and Touko Hakahuhta
• Published date: 06 September 2023

The Hague Judgments Convention of 2019 entered into force on 1 September 2023. The Judgment Convention is a new instrument in cross-border dispute resolution in civil and commercial matters.

The Judgment Convention's objective is to establish a unified framework for the recognition and enforcement of foreign judgments. By providing clear rules and procedures, the Judgments Convention aims to enhance legal certainty, promote predictability, and facilitate international trade and commerce.

In this blog post, we will explore the effects of the Judgments Convention, with a particular focus on its potential impact on the current situation concerning the United Kingdom in the post-Brexit era.

APPLICATION BEGINS BETWEEN THE EU AND UKRAINE

So far, the Judgments Convention has nine signatories, and three of the contracting parties - the EU, Ukraine and Uruguay - have ratified it. The Judgments Convention entered into force on 1 September 2023, when its application commenced between the EU (excluding Denmark) and Ukraine.

As the application of the Judgments Convention commences, it is essential to note that the Judgments Convention's entry into force will not affect recognition and enforcement of intra-EU judgments. The Brussels Regulation will continue to apply between the EU Member States.

It remains to be seen whether more jurisdictions will accede to and ratify the Judgments Convention, which would, at best, improve the much-needed circulation of foreign judgments in civil and commercial matters.

NON-EXCLUSIVE JURISDICTION CLAUSES INCLUDED IN THE SCOPE OF THE CONVENTION

One of the main features of the Judgments Convention is that it applies to judgments stemming from non-exclusive jurisdiction clauses.

Non-exclusive jurisdiction clauses can be defined in negative: they do not designate the courts of one state or one or more specific courts of one state to the exclusion of the jurisdiction of any other courts. Such clauses are common in finance agreements, for instance.

In this regard, the Judgments Convention avoids the overlap with the 2005 Hague Choice of Court Convention, which enables contractual parties to agree on the exclusive court that will hear a claim. If this prerequisite is satisfied, the Choice of Court Convention also provides for the recognition and enforcement of a judgment given by the court chosen by the parties.

However, if the jurisdiction clause between the parties is non-exclusive, the Choice of Court Convention does not apply. For...