As the clock ticks ever closer to the end of the Brexit transition period at 11pm on 31 December 2020, divorcing HNW (High Net Worth) couples with links to an EU Member State may need to act sooner rather than later to avoid running the risk of protracted jurisdiction proceedings or being unable to rely on the English courts altogether.
Prior to the end of transition, High Net Worth Individuals need to ensure they are taking early advice about the ramifications of the severing of ties between the UK and EU.
Following the UK’s departure from the EU in January 2019, the Withdrawal Agreement provided for an 11-month transition period during which the UK would remain in both the customs union and single market, and would continue to follow EU laws.
For divorcing couples and family lawyers this meant that conflict of laws and related disputes between the UK and EU Member States (other than Denmark) would continue to be governed by Brussels II Regulation (EC) No 2201/2003, known as Brussels IIa.
Brussels IIa provides that the principle of lis pendens applies to jurisdictional disputes between Member States, so that the first party to issue proceedings seizes jurisdiction.
If proceedings are then issued elsewhere, that jurisdiction is compelled to stay proceedings.
It also provides for an automatic recognition of judgments and decrees between Member States, meaning divorces in one Member State will be automatically recognised in another.
Following the end of the transition period, the UK will cease being subject to EU laws and therefore Brussels IIa will no longer apply to proceedings instituted after that point.
While the regulation was not perfect and encouraged parties to race to court in order to seize jurisdiction in preference to using alternative dispute resolution, its absence will result in a loss of certainty for couples commencing proceedings from that date.
At the time of writing, there is no intention for the government and the UK to negotiate a bespoke agreement which would govern jurisdictional conflicts and therefore forum non conveniens will replace lis pendens as the principle for the courts to adopt.
This means that, instead of the jurisdiction first-seized determining the location of the proceedings, the court has discretion to determine which jurisdiction is the more appropriate one for the dispute to be heard in.
Therefore, if a party suggests to the English court that an EU Member State is a more appropriate jurisdiction, the court will have the discretion to stay the English proceedings.
The court will consider which jurisdiction is the more appropriate, giving it discretion to decline jurisdiction even where English proceedings were the first instituted, if it considers that the parties have closer links with another place.
The jurisdiction for divorce proceedings is particularly important where there are related financial proceedings. The law surrounding finances after divorce varies hugely from jurisdiction to jurisdiction and has resulted in England becoming the “divorce capital" of the world, due to the courts traditionally being more generous to the economically weaker party than elsewhere.