The new kid on the block: the HCCH Judgments Convention of 2 July 2019
The HCCH has adopted a new convention that offers a facilitated regime of global circulation of court decisions in civil and commercial matters aiming to foster international trade. Care is needed to coherently shape the treaty’s place in existing regimes.
The new outcome of an old project
On 2 July 2019 the Hague Conference on Private International Law (HCCH) adopted the Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters ( Judgments Convention). It aims to establish – for the future Contracting States – a regime of simplified recognition and enforcement of court decisions. The convention is the result of the ‘Judgments Project’, rooted in an even older idea of creating a counterpart to the successful 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards ( New York Convention), that celebrated its 60th anniversary last year.
The need for such an instrument was already felt in the 1990s, when the late Professor Arthur von Mehren (Harvard) came up with the idea of creating a uniform regime for the global circulation of court judgments in civil and commercial matters. This was followed by considerable preparatory work which started in 1992. Yet, the most ambitious goal of an all-encompassing global uniform regime had to be postponed, if not abandoned, for two main reasons. First, the success of the regional unification through the predecessors of the Brussels Ibis Regulation and the 2007 Lugano Convention. Second, the considerable differences in national civil procedure, most importantly the diverging US and continental European approaches that are difficult to reconcile in a global instrument.
The project scaled down: the 2005 Convention on Choice of Court Agreements
In 2003, the initial goal of the Judgments Project was amended. The work continued, but was confined to commercial transactions including an exclusive choice of court agreement. The work resulted in the adoption of the Convention on Choice of Court Agreements ( Choice of Court Convention) in 2005. Commentators of one of the first decisions to apply this instrument, echoing the old project’s ambition, referred to the Choice of Court Convention as the serious counterpart to the New York Convention. Currently, the Choice of Court Convention is in force in the EU, Mexico, Singapore, and Montenegro. It has also been signed (but not yet ratified) by Ukraine and two important trade powers – China and the United States. Accession of other countries is actively being promoted by the HCCH.
Back to the initial ambition
While promoting the Choice of Court Convention, in 2012 the HCCH went back to the initial idea of a global uniform instrument. The Judgments Project was relaunched and resulted in the recent adoption of the Judgments Convention. The ‘new kid on the block’ turned up later than its already existing ‘downscaled version’. Compared to the Choice of Court Convention, the substantial scope of the Judgments Convention is broader since it is not confined solely to exclusive choice of court agreements, but also includes employment and consumer contracts, rights in rem and tenancies of immovable property. However, the Judgments Convention is still a compromise of the initial idea. Diplomatic discussions on several matters, including intellectual property, certain anti-trust (competition) matters and defamation, have not yet lead to consensus.
A delicate coexistence
Another delicate question is the new convention’s coexistence with the Choice of Court Convention as regulated in Article 23 Judgments Convention (Relationship with other international instruments). This question was not disregarded during the travaux preparatoires. According to the Draft Explanatory Report (para 220 ff) the underlying idea is that the Choice of Court Convention’s regime would apply to the assessment of the grounds of jurisdiction, if an exclusive choice of court is made. The Judgments Convention would cover other jurisdictional grounds, including non-exclusive choice of court agreements (Article 5(1)(m)). The envisaged coexistence of the recognition and enforcement regimes of both instruments is explained in the Draft Explanatory Report (para 421) as follows: ‘In most systems, the party seeking recognition and enforcement can rely on either instrument, or on both instruments, in the alternative.’ As a result, ‘[t]he procedure under one instrument could be more favourable than the procedure under the other instrument. The applicant seeking recognition and enforcement would then be entitled to use the more favourable process for recognition and enforcement’ (para 422). This is the case, for example, in Article 7 Judgments Convention and Article 9 Choice of Court Convention, where the grounds for refusal of recognition and enforcement diverge on certain points. But this is not the only possible situation of concurrence. For certain disputes with a connection to EU Member States, both conventions can concur with the Brussels regime. For disputes connected with Iceland, Norway or Switzerland, concurrence with the Lugano Convention is possible. This may add more complexity to the task of the practising lawyer or judge.
Aiming for success
The complexity of the coexistence of different cognate regimes certainly does not imply that the Judgments Convention could not become a success. While the HCCH is enthusiastic about the new instrument, the success of a convention is difficult to measure. One could assess, for example, whether a treaty caters for specific needs either of a country or of the participants in (a particular branch of) international trade. In the case of Brexit, the Judgments Convention could be an alternative to the Brussels Ibis Regulation for the UK, in the same way as the Choice of Court Convention to which the UK acceded under the condition precedent of leaving the EU. One could also simply count the number of ratifications some decades after the adoption of a treaty. The Judgments Convention is now open for accession to all countries.