A year ago the United Kingdom (“UK”) and the European Union (“EU”) reached the Brexit deal. However, it was a “no deal” for the direct enforcement of judgments. Since the UK and the EU have not (yet) reached an agreement on the accession of the UK to the Lugano Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the “Lugano Convention”), the question arises how to deal with the enforcement of judgments by the English Court (“British judgments”) in the Netherlands after the Brexit deal.
1. Which rule applies for the enforcement of a British judgment in the Netherlands if the case was brought to court on or before 31 December 2020?
British judgments in civil and commercial matters brought to the English Court on or before 31 December 2020 can still be enforced directly in the Netherlands, because the rules enforcement of the Brussels I-bis Regulation still apply pursuant to the Withdrawal Agreement.
For British judgments in cases that are brought to court on or after 1 January 2021, the Brexit deal does however not regulate the enforcement in the Netherlands. Therefore the rules of enforcement are based on the following regulations, depending on the circumstances.
2. Is an exclusive choice of court clauses included in the agreement (entered into on or after 1 April 2019)?
The 2005 Hague Convention on Choice of Court Agreements (the "Hague Convention") – to which the UK has separately acceded in the Brexit process – applies to exclusive choice of court clauses in agreements that are entered into on or after 1 April 2019 and concern civil or commercial matters in "international situations 1.”. The Hague Convention provides that British judgments can be enforced in the Netherlands. However, a British judgment is not directly enforceable as it was before the Brexit. First an exequatur or a declaration of enforceability must be obtained by the Dutch Court. A Dutch new substantive procedure within the meaning of Article 431(2) of the Netherlands Code of Civil Procedure (“NCCP”) will not be needed. The advantage of including an exclusive choice of court clause in an agreement is therefore that it saves parties time and effort in the event that a British judgment has to be enforced in the Netherlands.
3. Does the British judgment on or after 1 January 2021 only concern the payment of a sum of money?
When a British judgment on or after 1 January 2021 only concerns the payment of a sum of money, the enforcement of this judgment in the Netherlands can be based on the bilateral Convention between the Kingdom of the Netherlands and the United Kingdom of Great Britain and Northern Ireland providing for the Reciprocal Recognition and Enforcement of Judgments in Civil Matters (the “Convention November 1967”). This is regardless of whether there is an exclusive choice of court or other jurisdiction clause included in the agreement. The parties should be aware that this judgment must involve an order to pay a definite or sufficiently definite amount. Under this convention, an enforcement of a British judgment in the Netherlands also requires an exequatur or a declaration of enforceability by the Dutch Court. Parties are not obliged to start a new substantive procedure within the meaning of article 431(2) NCCP.
According to the Amsterdam Court of Appeal, the Convention November 1967 does not apply when the judgment orders the payment of costs that have yet to be budgeted2. Also, a judgment could contain obligations to do or to omit something next to the order to pay a sum of money. Parties must then rely on national or domestic regulations. Naturally, in case the Hague Convention also does not apply.
4. Does the judgment on or after 1 January 2021 concern a non-monetary obligation or does the agreement include a non-exclusive or asymmetrical choice of court clause?
In the case of, among other, a non-exclusive or asymmetrical choice of court clause or if the British judgment contains an obligation to do or to omit something, the 'national path’ of article 431(2) NCCP must be followed. This means that the substantive case must be reassessed by the Dutch court3. However, the reassessment will not lead to a full 'retrial' quickly, as long as the Dutch court can ascertain that - in short - the British judgment has been rendered by a competent court, in a procedure surrounded by sufficient guarantees and is not in conflict with the Dutch public policy or a Dutch judgment with the force of res judicata between the same parties on the same dispute.
5. Schematic representation of enforcement of British judgments in the Netherlands on or after 1 January 2021
Here follows a schematic representation of the information from the above.
6. Consequences for agreements, deeds, instruments and legal opinions
Because the British judgments on the basis of current regulations are not immediately enforceable in the Netherlands, this has various consequences in practice. For example, in a contract, an exclusive choice of court clause could be advisable, where it would initially have been hybrid. Also in other situations, the way in which a British judgment can be enforced will have to be addressed, for example when drawing up legal opinions, litigation agreements, deeds and other legal instruments.
The question now remains whether the UK will accede to the Lugano Convention. If the UK is a party to this convention, the UK judgments can be enforced directly in the Netherlands. However, the possible outcome of the vote is not clear. Soon the member states of the Lugano Convention will vote on this.
Do you have any further questions about the enforcement of British judgment in the Netherlands? Would you like to know more about drawing up a solid jurisdiction clause in your contract or the practice of issuing a legal opinion? We are happy to help.
