A post-brexit guide to UK-swiss disputes

COMMERCIAL AND BUSINESS LAW PARTNER, SÉBASTIEN COLLART, DESCRIBES THE IMPACT OF BREXIT ON CROSS-BORDER DISPUTES BETWEEN ENGLAND & WALES AND SWITZERLAND

The Brexit transition period ended on December 31, 2020, or “Exit Day”[1]. Since January 1, 2021, the courts of England and Wales are no longer covered by the EU rules for establishing jurisdiction and for mutual recognition and enforcement of judgments between member states contained in the Brussels Regulation.

Brexit also resulted in the UK no longer being party to the Lugano Convention, which establishes unified rules regarding jurisdiction and the mutual recognition and enforcement of judgments between the EU member states other than Denmark as one entity — previously, but now no longer, including the UK — and Norway, Denmark, Iceland and Switzerland. The aim of the Lugano Convention is to prevent parallel proceedings and irreconcilable judgments in two countries because their courts take different views as to which court has jurisdiction, and to ensure mutual respect for the judgments of other participating countries without substantive review of the merits of the claim under a different national law.

Therefore cross-border disputes involving parties and assets in England, Wales and Switzerland are also affected by Brexit[2]. As things now stand, the position for cross-border disputes between the UK and Switzerland is the same as that between the UK and the EU member states in that the key issues of jurisdiction, and recognition and enforcement of foreign judgments in civil and commercial cases are governed by each country’s national laws, with the exception of any international treaties in force in both states. That position will remain until either all the Lugano Convention members agree that the UK may rejoin in its own right or a separate agreement is reached between the UK and Switzerland. At present, while Switzerland has indicated its consent for the UK to accede to the Lugano Convention, the EU has not and is expressing some concerns about potential anomalies arising from the UK’s position outside the EU. Consequently, for now, the Swiss courts will apply the provisions of the Federal Private International Law Act, or PILA, and the UK will apply its common law rules.