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Home / News and Insights / Insights / Will Brexit mean an exit for arbitration?

Will Brexit mean an exit for arbitration? Will parties be less inclined to arbitrate post Brexit?

Donna Goldsworthy does not think so and believes it may make London more appealing as an arbitral venue.

Why?

English courts are well known for upholding the independence of the arbitral process and will not intervene unless absolutely necessary. The Arbitration Act 1996 also provides the courts with powers to support arbitration if required.

London-seated arbitration is frequently a first port of call, even where the parties have no connection to the UK. London as a seat remains a good choice because international parties regard the English legal system as efficient effective and impartial. Furthermore – English law in contracts remains trusted internationally

Will this change post Brexit?

None of these features are likely to change assuming the UK withdraws from the membership of the EU. The arbitral processes will be available and continue in spite of the Brexit process.

Why?

Generally, enforcement of English arbitration awards in EU countries (or elsewhere) takes place under the New York Convention. The New York Convention, to which 157 countries are currently signatories (including the UK and all other EU member states) is not reliant or connected to EU membership, so it follows that enforcement of English awards in EU countries under its provisions will be unaffected.

Will there be more arbitrations in London post Brexit?

We think that there will be London-seated arbitrations as the enforcement process under the New York convention will provide international parties certainty that a dispute can be resolved following the rules under the New York Convention.

The return of EU anti-suit injunctions?

Following Brexit, it is possible that the UK courts may again be able to support arbitrations by issuing anti-suit injunctions to restrain proceedings commenced in EU member state courts in breach of an arbitration agreement. Should this happen, London will become even more attractive as a seat for arbitration in comparison to other EU arbitral venues. Arbitration is also attractive when it comes to enforcement and an award can be easily enforced in many more countries than a court judgment because of the recognition and enforcement of foreign arbitral awards afforded by the New York Convention world wide.

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