In December 2016, the FMLC published a paper on questions arising in the context of Brexit relating to English governing law and jurisdiction clauses in cross-border financial markets transactions. The looming issue of legal uncertainty, it observed, was that a number of legal instruments which form the bulk of private international law (or “conflict of laws”) rules which regulate financial markets transactions apply in the U.K. solely by reason of the fact that the U.K. is a Member State of the E.U. These instruments include the 2005 Hague Convention on Choice of Court Agreements (the “Hague Convention” or the “Convention”). In order to avoid any disruption in the normal conduct of business, the FMLC had recommended in the 2016 Paper that the U.K. should become a party to the Hague Convention.
The U.K. deposited its instrument of accession to the Hague Convention in December 2018 with the intention that the Convention would come into force for the U.K. on 1 April 2019. In March 2019, HM Government negotiated two extensions to the Article 50 notice period, consequently setting a new Exit Day of 31 October 2019. The depositary for the Hague Convention issued a notice communicating that the U.K.’s accession to the Convention is suspended until 1 November 2019.
The U.K.’s accession to the Hague Convention in its own right has not, however, been the panacea for which market participants and HM Government had hoped. A number of questions have arisen regarding the timing of the Convention’s entry into force in the U.K. and its application to exclusive choice-of-court agreements concluded in the period before the U.K.’s accedes to the Hague Convention in its own right. The suspension raises further issues of interpretation. It is intended that this Addendum survey the situation as it currently stands with respect to exclusive choice-of-court agreements and the recognition of English court judgments—by way of update to one aspect of the 2016 Paper—and set out the better view as to the applicability of the Hague Convention in the U.K.
Available at: PDF.