When it was signed on 12 January 2024, the then Sunak-led Conservative government branded the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters ("Hague Judgments Convention") as a "landmark treaty"[1] that would save UK citizens and businesses money and time if they were caught up in international legal disputes.
The Hague Judgments Convention is back in the news as the necessary legislation and rules to incorporate it into UK law have now been published and, on 27 June 2024, the UK deposited its instrument of ratification. This step signals the UK's commitment to promote itself as an attractive jurisdiction for dispute resolution and international trade.
What is the Hague Convention?
The Hague Judgments Convention is an international multilateral treaty which is aimed at creating a uniform set of rules to enable easier recognition and enforcement of judgments in signatory states. This means that a ready framework is in place for anyone who has succeeded in court proceedings in one country and wants to execute the judgment in another country where their opponent's assets are located.
Currently, over 30 states have signed the Hague Judgments Convention, including the USA and the European Union. The larger membership makes the Hague Judgments Convention more effective than its 2005 predecessor.
The Hague Judgments Convention is limited in scope, however, and for all the right reasons. It extends only to civil and commercial matters, and specifically excludes its application to intellectual property, insolvency, family law and other matters that are popularly regarded as falling within the realm of public policy.[2] Broadly, the rationale behind the exclusions is that these matters are either already governed by other international instruments, or they are matters of public policy on which it might be difficult to obtain the various member states' consensus on their interpretation.
What's in it for consumers and businesses?
The UK is the world's sixth largest economy and is widely regarded as a centre of international trade and business as well as dispute resolution. In this context, it is apparent that the Hague Judgments Convention is of particular importance to the UK's economy and legal system.
The legal certainty lent by the Hague Judgments Convention will promote predictability, enhance access to justice and ultimately reduce costs for international litigants. It bolsters the UK's position as a sophisticated legal jurisdiction and preferred destination for cross-border investment and dispute resolution.
Newly-published legislation and rules
The two main statutory instruments of note are (1) The Civil Procedure (Amendment No. 2) Rules 2024, and (2) the Recognition and Enforcement of Judgments (2019 Hague Convention etc) Regulations 2024. The first makes amendments to Part 74 of the Civil Procedure Rules 1998 ("CPR") which deals with the enforcement of judgments in different jurisdictions (and there is also an associated Practice Direction update to amend Practice Direction 74A of the CPR). The second is largely focused on amendments to the Civil Jurisdiction and Judgments Act 1982, which will have the effect of incorporating the Hague Judgments Convention into domestic law in the UK.
Included in the legislation is a registration requirement for parties seeking recognition and enforcement of a foreign judgment in the UK under the Hague Convention, as well as a route of challenge for setting aside a registration decision.
Looking ahead
We will have to wait for some time before we see the benefits of the Hague Judgments Convention. Pursuant to the UK having deposited the instrument of ratification, the Hague Judgments Convention will enter into force in the UK, along with the associated UK legislation, on 1 July 2025. However, importantly, it will apply only to judgments given in proceedings commenced after that date.
The Law Society, whilst lauding the UK's signing of the Hague Judgments Convention, emphasised that this was not the end of the journey for the enforcement of foreign judgments. Continued efforts need to be made to facilitate the enforcement of foreign judgments, including by acceding to the Lugano Convention.[3]
[1] Gov.UK Press Release, UK citizens and businesses to be spared time and money on cross-border legal disputes https://www.gov.uk/government/news/uk-citizens-and-businesses-to-be-spared-time-and-money-on-cross-border-legal-disputes 12 January 2024.
[2] Article 2of the Hague Convention.
[3] The Law Society Press Release, UK signs up to Hague Convention, https://www.lawsociety.org.uk/contact-or-visit-us/press-office/press-releases/uk-signs-up-to-hague-19-convention 15 January 2024.
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