London asks EU to leave legal ties untouched
BRITAIN wants to keep London at the centre of European commercial legal disputes after Brexit. Except, without the European Court of Justice (ECJ).
A paper published by the British government on Tuesday gave few details about how this might be achieved, but it was clear that Britain doesn’t want to lose lucrative litigation business, which contributes more than £25 billion (R424bn) a year to the economy, according to business lobby group TheCityUK.
Officials pointed to a paper on the ECJ which was to be published yesterday as likely to give more information on that aspect.
Instead, the document focused on why such a deal would benefit both sides, highlighting the UK’s close links with the EU. The danger for Britain is if EU members decide they want a larger share of international litigation – according to the government.
“The optimum outcome for both sides will be an agreement reflecting our close existing relationship,” the government said. “Where litigating a cross-border case involving UK and EU parties under civil law, wherever it might take place, will be easier, cheaper and more efficient for all involved.”
The UK plans to continue its membership of international treaties that cover cross-border litigation, including the Hague Conventions focused on civil disputes, and the Lugano Convention, which allows members of the European Free Trade Association to work with EU courts.
But once Britain leaves the EU and rejects any role for the ECJ in British law, the possibility of “drift” away from EU standards will make it an increasingly unattractive place for banks and insurers to resolve disputes, according to Peter Bert, a litigator at Taylor Wessing, which was formed as the result of a merger between law firms in England and Germany.
“The question is how long UK law remains the law of choice for companies who are under EU regulatory oversight,” said Bert, who is based in Frankfurt. “Until now, if you chose UK law, you didn’t have to think twice because you chose a law that automatically was 100% EU-compatible.” – Bloomberg