Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019

Considered in Grand Committee

Moved by

That the Grand Committee do consider the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019.

My Lords, this draft instrument forms part of our ongoing work to ensure that, if the UK leaves the EU without a deal, our legal system will continue to work effectively for our citizens. If Parliament approves the withdrawal agreement, which includes an implementation period, and passes the necessary legislation to implement that agreement, the Government would defer the coming into force of these instruments until the end of that implementation period. Once a deal on our future relationship has been reached, we envisage that they would be revoked entirely.

Your Lordships will be aware that, as part of these preparations, the Government have published a series of technical notices to outline the implications of a no-deal exit for citizens and businesses. One of these, published on 13 September 2018, was titled Handling Civil Legal Cases that Involve EU Countries if There’s No Brexit Deal. It set out the implications of a no-deal exit for the rules on how to resolve cross-border disputes in civil and commercial cases.

The Secretary of State, the Ministry of Justice ministerial team and officials have had regular engagement with key stakeholders in the field of civil, commercial and family justice, including the Law Society of England and Wales, the Bar Council, through the Brexit Law Committee, and individuals. This has included discussions on the technical notice, to ensure that our policy proposals in respect of no deal provide the best outcome for citizens and businesses. The instruments we are discussing today are designed to implement the policy outlined in the technical notice. The Joint Committee on Statutory Instruments reviewed the statutory instrument and had no substantive comments.

This draft instrument makes changes to the rules in England and Wales, in Northern Ireland and in Scotland that determine which courts should have jurisdiction in cross-border civil and commercial cases involving courts in EU and relevant EFTA countries—that is, those party to the Lugano convention: Norway, Switzerland and Iceland. It also changes the rules on how to ensure that any judgments or decisions can be enforced across the EU and relevant EFTA states.

It may be helpful if I explain the current effect of EU law in this area. The current principal measure in relation to civil and commercial law is known as the Brussels Ia regulation, as it replaced the so-called Brussels I regulation. Denmark has a separate agreement with the other EU member states, based on Brussels Ia, to give Denmark access to the EU’s system of civil judicial co-operation, because it does not normally participate in EU justice and home affairs measures, pursuant to Protocol 22 of the Treaty on the Functioning of the European Union. There is also a separate but similar agreement, the 2007 Lugano convention, based on Brussels I, between the EU and Norway, Switzerland and Iceland. It also applies to Denmark. Brussels I, as distinct from Brussels Ia, remains of some continuing relevance because it applies in respect of actions commenced prior to 10 January 2015, but it is of limited relevance to the present issue.

My Lords—

I am not taking interventions during the opening speech. It is the Government’s view that removing deficient retained EU law and associated domestic legislation from domestic law will clarify the rules that apply to determine jurisdiction, recognition and the enforcement of judgments post exit. This has the benefit of protecting litigants from unnecessary expense and making UK legislation more transparent, therefore protecting its reputation. This will also ensure that the same rules apply to cross-border matters involving EU and non-EU countries.

There will be deficiencies in retained EU law, which implements the instruments of the Brussels regime, due to a lack of reciprocity. That will become obvious if we leave the EU without a deal. This SI fixes those deficiencies and establishes a practicable set of rules for dealing with cross-border disputes in civil and commercial matters in such a scenario.

My Lords, before the Minister sits down—

I have already sat down.

The Minister said that he would not take interventions.

That is correct.

That is extremely disrespectful to the Committee, if I may say so, because now there is no other way for us to ask the Minister questions before he responds at the end of the entire debate—and we will have no means to come back on his statements at that point because the Question will be put at the end.

Just to be clear, I have already sat down.

I am happy to take an intervention from the noble and learned Lord, even though he was not prepared to take one from me. I will speak later in the debate but I just want to put on record that I find his actions extremely disrespectful to the Committee. That alone would lead me to wish to negative the instrument, because the Minister is not subjecting himself to the proper process of interrogation and answering questions on the regulations. It is immensely disrespectful and the first time that a Minister has come to a Grand Committee and not been prepared to answer questions in the normal way.

My Lords, when I looked at the instrument, I began to wonder whether the Minister was open to the charge from some of his colleagues here and in the other place that he was part of Project Fear, because the instrument sets out some consequences of Brexit, both in general and in a no-deal scenario, pretty starkly.

The loss of reciprocity is central to this instrument. I did not notice the Minister express any concern or grief at this but it represents the removal of something that we have developed in recent years, to the great advantage of litigants, and which we are about to lose, to our detriment. The consequence is that separate enforcement will be required in many cases, including judgments of foreign courts; by foreign, I mean courts in the EU or the Lugano states. Incidentally, that includes Norway, a state with which we have particularly close and friendly relations.

The Explanatory Notes to the regulations show that the Government go only this far by stating:

“The impact on business, charities or voluntary bodies of this instrument is, on balance, expected to be positive when compared to making no changes to retained EU law”.

However, in the same paragraph the notes go on to explain that,

“an increased risk of parallel proceedings … could increase the number and complexity of disputes before the courts and the cost of litigation for parties … Common law rules also involve a less efficient mechanism for recognising and enforcing judgments than using existing EU rules deriving from the Brussels regime, which will cost those seeking to have their judgment recognised in the UK more money and time”.

There is a serious loss in that and a further loss in relation to the European Judicial Network, another development that has been beneficial to this country and to justice across Europe generally. Again, a bald statement is made in paragraph 7.14:

It is not clear from much that the Government have said elsewhere so far to what extent they are making the retention of any of these things a priority in the withdrawal agreement and the political processes that would follow if the withdrawal agreement is approved. Of course, we have no idea what would be agreed to. Precisely what will happen under the scenarios of either no deal or a deal needs to be made a little clearer. I think the Minister has indicated that the instrument would not be commenced if there was a deal, but perhaps he could explain that a little more clearly. My understanding so far, partly from intervening on him in another debate, is that there will have to be quite extensive provisions in any withdrawal agreement Bill to prevent all these no-deal SIs coming into effect if they are not needed. It is unclear whether any part of them would be needed if we had a deal but the Government were unable to reach satisfactory agreements about reciprocity and judicial co-operation so as to continue with the provisions whose loss I have been lamenting today.

I hope the Minister can make clear at some point what will happen to this instrument under either of those scenarios and to what extent it is the Government’s intention to seek to recover what, in a no-deal situation, they know they will lose in the respects that I have mentioned.

My Lords, I rise to ask a question and I am grateful to my noble and learned friend Lord Keen for setting the scene. A theme seems to be developing in relation to practitioners and the recognition of court judgments with the Government’s proposed exit from the European Union. My noble friend has responded to some of my concerns as regards practitioners and trading in legal services, which I hope to address in the context of the Trade Bill.

My specific concerns relate to the remarks of my noble and learned friend and what is set out on page 5 of the Explanatory Memorandum, which sets out a number of the deficiencies that will arise if we crash out without a deal. I presume that this falls into the same category that services and the jurisdictions of courts fall into with the World Trade Organization and its General Agreement on the Trade in Services. My question is similar to that of the noble Lord, Lord Beith. What will be the status of this in those circumstances? However, I have a more direct question of my own. If this is being done on the basis of reciprocity and if the instrument before us today seeks to fill the gap so that court judgments will be recognised in this country, what measures are the Government and my noble and learned friend’s department taking to ensure that reciprocity will be respected in the circumstances of Britain leaving without a deal?