After Britain formally left the transition period in January, Prime Minister Boris Johnson had to ask the EU for permission to join an international treaty, failing to devastate a multibillion pound legal services industry . The agreement is called the Lugano Convention and its effects are much the same as the Brussels Regulation of 2001. It governs questions of jurisdiction and the enforcement of judgments between EU Member States and countries of the European Union. ‘European Free Trade Association (EFTA) other than Liechtenstein (ie Iceland, Switzerland and Norway).
London is considered the international dispute resolution capital of the world, due to England’s world-class legal system and courts.
A long-term failure to join the Lugano Convention could cause real damage to the UK legal services sector, which beats the world, as well as create difficulties for large companies.
The UK abandoned the treaty following Brexit and applied to join in April 2020.
Such accession requires the unanimous agreement of all other contracting parties to the Convention and the European Commission has now recommended that the EU reject this request.
He said the European bloc was “not in a position” to give its consent to the UK membership.
However, the EU’s position is not shared by the EFTA countries, which have been much more welcoming.
In March 2021, the Swiss Federal Department of Foreign Affairs issued a letter confirming that Switzerland had consented to the UK being invited to deposit its instrument of accession to the Lugano Convention.
The letter reads: “Switzerland welcomes the intention of the United Kingdom (UK) to accede to the Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (the“ Lugano Convention 2007 “) and will support a UK membership application.”
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In an exclusive interview with Express.co.uk, a trade adviser to the UK government, who wishes to remain anonymous, argued that the EU had to be very careful, as Switzerland could “react” if the bloc continued to get rid of the Great Britain just for the sake of it.
He said: “I think the EU has to be careful, especially with the EFTA countries and Switzerland, because they might push them back with their actions.
“Mainly Switzerland because what Switzerland does is different.
“It is aligning itself with EU regulations on purpose, which is obviously quite controversial and is becoming more and more controversial.
“For example, the Swiss had their own data protection law, weaker penalties for GDPR and the EU said, because it was different, that they were going to punish them on financial services even though the result was the same. “
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He added: “If you add this to that, then I think you’re going to find yourself in a situation very quickly where the Swiss are going to react.
“The EU must be careful about this
“What is the advantage of the European Community and what is the advantage for European companies to have the United Kingdom in the Lugano convention?
“I would not reject the UK for the sake of rejecting the UK when I could harm my own economic interests.”
This sentiment has been shared by several lawyers, who believe that the Commission’s decision will now bring painful and costly legal insecurity to family breakdowns.
Rachael Kelsey, president of the European section of the International Academy of Family Lawyers, urged the EU to reconsider its position for the sake of millions of European and UK citizens with family connections straddling the English Channel.
She told the Financial Times: “A year ago we could say with complete confidence and clarity ‘this court has jurisdiction, this is how long a case will take, and that is the approximate cost” – but Now, that is no longer the case .
“We need to put politics aside and recognize that there are millions of citizens in the EU and the UK who are going to be harmed if we don’t end up with a better set of harmonized rules.”
Additionally, Josep Gálvez, a former Spanish judge and commercial arbitration expert now at London-based Del Canto Chambers, told the publication that the Commission’s advice to block UK membership appeared to be designed to weaken the attractiveness of the British capital as a center for dispute resolution. .
He said: “This is a way to punish the UK for leaving the EU, but also a very good opportunity for some EU jurisdictions to bring international disputes to their courts.”