In a significant development for cross-border litigation, the UK has ratified the Hague Judgments Convention 2019 (HJC). We take a short look at what this means, including the implications for the use of the English courts as a chosen forum for the resolution of international disputes.

What is the Hague Judgments Convention 2019?

The HJC is an instrument which provides a recognition and enforcement regime for court judgments, in civil and commercial matters, amongst states who become party to it (HJC Contracting States). It is concerned with the treatment of a judgment from one HJC Contracting State (the State of origin) in another HJC Contracting State (the requested State). Notably, it is an instrument which is somewhat wider in scope than the Hague Convention on Choice of Court Agreements 2005 (HCCC) as the HJC contains a broader range of grounds upon which judgments may qualify for recognition and enforcement pursuant to its terms (by contrast, a concept central to the HCCC is the use of a fully exclusive choice of court agreement (ECCA)).

As with any such instrument, it is technical, and contains detailed provisions. A “taster” of its core workings is as follows.

Bases for recognition and enforcement: At the heart of the HJC is its list of “bases”. If any one of these are met then the judgment becomes eligible for recognition and enforcement under the HJC’s scheme.

These “bases” contain grounds which, broadly speaking, establish a connection between the defendant and the State of origin (e.g. defendant was habitually resident there), or a connection between the claim and State of origin (e.g. place of performance of a contract). The HJC is “holistic” in the sense that the bases cover a range of grounds and are not limited to, for example, contractual claims.

Notably, one of the bases is the existence of a choice of court agreement in favour of a court of the State of origin in a form other than an ECCA (the meaning of ECCA is derived from the HCCC - the HCCC and the HJC are intended, in a broad sense, to be complementary but their operation is different and there is no requirement on a state to be party to both).

General effect/regime: Where it applies, the HJC’s recognition and enforcement regime requires recognition and enforcement in any HJC Contracting State without a review of the merits of the case. There are, however, certain grounds (broadly familiar from other international law instruments) upon which this can be refused.

Entry into force provisions: The HJC contains reasonably complex provisions as to its entry into force. In summary, however, when one state deposits its instrument of ratification/acceptance it can choose to opt-out of the HJC’s application between it and any other HJC Contracting State. Each HJC Contracting State also then has a 12-month period in which it has an equivalent, individual, right to decide that the HJC will not apply as between it and the joining state. Subject to these notifications, the HJC then enters into force accordingly between the joining State and the other HJC Contracting States on the first day of the month after the expiry of that 12-month period. Furthermore, in order for it to apply to a particular set of proceedings, the HJC’s transitional provisions require the proceedings to have been instituted at a time when the HJC had effect between the State of origin and the requested State.

In September 2023, the HJC entered into force for the first time, and as between the EU Member States (excluding Denmark) and Ukraine. Uruguay also, in September 2023, ratified the HJC (so the HJC is due to enter into force for Uruguay, subject to any such notifications, on 1 October 2024).

What does the UK’s ratification mean, and why is it significant?

Following the UK’s signature in January, it has now, on 27 June 2024, formally ratified the HJC. This means that the HJC is due to come into force in respect of the UK on 1 July 2025. The UK’s ratification was accompanied by one declaration made by it to the effect that, pursuant to Article 25/30 HJC, it has limited the HJC’s application to England & Wales only. It is not entirely clear why Scotland and Northern Ireland have been excluded from the scope of the ratification for now. However, as noted in the declaration, and provided for in Article 30, that is a position which the UK can modify.

Overall, however, the UK’s ratification is likely to be regarded as a very welcome step. In particular, because it carries the potential to help rebuild cross-border judicial co-operation between the UK and EU. As is well known, aside from the HCCC (which is relatively narrow in scope), following the UK’s exit there has been no holistic EU/UK arrangement covering mutual recognition and enforcement of judgments, with the result that national law may apply in many cases.

So, provided the EU permits the HJC to apply between it and the UK, it could help plug that gap. Furthermore, from the perspective of business-to-business transactions (along with certain other subject matter excluded from their scope, both the HJC and HCCC contain limitations or exclusions in relation to consumer or employment cases), it would help better facilitate the use of English jurisdiction clauses in commercial contracts involving EU entities. Generally, as between the UK and EU, the HJC would then sit alongside the HCCC with the latter providing coverage for the recognition and enforcement of a judgment where an ECCA has been used, and the former doing so where some other form of jurisdiction agreement (for example a non-exclusive, or asymmetric clause) has been.

What happens next?

In practice, given the HJC’s relatively complex provisions on entry into force (including the possibility of “opt-outs”), parties would be sensible to wait until the HJC has fully come into force between the UK and any other HJC Contracting States before making any positive decisions (such as concerning the use of jurisdiction agreements) based on its application to the UK. Unless, and until, that happens (and in relation to any proceedings commenced before), then the situation on recognition and enforcement of UK judgments (and foreign judgments in the UK) will continue to be governed by currently applicable regimes. Having said that, although, in the immediate future, things remain the same, developments in this space will be closely, and optimistically, watched as, overall, this is a very positive development.