European Commission recommends that EU reject UK bid to join Lugano Convention

The post below was first published on our Litigation blog

On 4 May 2021, the European Commission has released its anticipated communication to the European Parliament and the Council confirming the Commission's view that the EU should not consent to the UK's application to accede to the Lugano Convention. If this position is reflected in the EU's formal response to the UK's application, the UK will not be able to accede to the Convention as it requires the unanimous consent of current contracting parties.

The Commission's stance is not surprising in light of recent press reports suggesting that the Commission was opposed to UK membership of the Convention (as referred in our previous post, here). The Commission justifies its stance by saying that it sees the Convention as a "flanking measure" for the EU’s economic relations with the EFTA/EEA countries via the internal market. In relation to all other third countries, it states, the EU's "consistent policy" is to promote cooperation within the framework of the multilateral Hague Conventions. It concludes:

"The United Kingdom is a third country without a special link to the internal market. Therefore, there is no reason for the European Union to depart from its general approach in relation to the United Kingdom. Consequently, the Hague Conventions should provide the framework for future cooperation between the European Union and the United Kingdom in the field of civil judicial cooperation."

At the end of the communication, the Commission states that it "informs the European Parliament and the Council of its assessment, and gives them an opportunity to express their views, before it will inform the Lugano Depositary accordingly". Our understanding is that the decision will ultimately be for the Council, by qualified majority voting (ie 55% majority, or 15 out of the 27 Member States, representing at least 65% of the EU population).

The Commission's communication also notes that it is planning to propose that the EU joins the 2019 Hague Judgments Convention "in the near future" - in which case, if the UK also joins that Convention, it would apply to future judicial cooperation between the UK and the EU. That would indeed be a positive step although, as we have previously noted, Hague 2019 will not come into force until (approximately) 12 months after ratification, and even then will only apply as between the UK and the EU where the proceedings that led to a judgment were instituted after the Convention was in force for both the UK and the EU.