Brexit News, Member News

Dispute Resolution Update: After Brexit – Ireland as a Litigation Safe Haven?

By Sinéad Power 

The departure of Ireland’s biggest trading partner from the EU will undoubtedly create challenges. However, depending on the outcome of the current Brexit negotiations and the precise terms of the deal that might ultimately be struck, this seismic change in our business and legal structure will also create opportunities.

Speaking in New York recently, Ireland’s Chief Justice Mr Frank Clarke highlighted Ireland’s attributes “in the context of transactions or litigation which involve common law countries who wish to do business within the EU in a legal system with which they are familiar but where European rules, including, in particular, rules which give Europe wide recognition, apply”. 

Common law
Contracting parties, in agreeing the jurisdiction of a future dispute, seek familiarity with court process and predictability.

The US, the UK and Ireland are all “common law” jurisdictions, where the court process is adversarial, judicial interpretation of statutes is of critical importance and courts follow previous decisions or “precedent”. The majority of other EU countries have a different “civil law” system, with an inquisitorial court process placing reliance on the prescribed content of codified law rather than previous court decisions. In European litigation terms, the UK has long been the foremost common law jurisdiction, not least due to its size and history. If the UK leaves the EU, Ireland will be the largest common law jurisdiction in the EU, with the added benefit of an English speaking judiciary.

EU membership
Ireland’s continued membership of the EU affords litigants the ability to enforce judgments obtained in Ireland throughout the EU. This right arises from the Brussels I Regulation and its successor, the Recast Regulation. These regulations apply irrespective of where the parties come from. It is currently unclear what arrangement, if any, the UK will negotiate to replicate this enforcement capability.  

Regardless, the Irish courts have the capacity to adjudicate on issues of EU law. If necessary, they may also seek a referral of an EU issue to the Court of Justice of the European Union (CJEU) – which their UK counterparts may not have following the UK’s formal exit from the EU. 

Commercial expertise
In Ireland, litigants can avail of a fast-tracked court process within the commercial division of the High Court. This “Commercial Court” harnesses commercial expertise within our judiciary and it generally deals with business disputes valued at a minimum of €1 million and intellectual property cases. Cases are, on average, concluded within 10 months from the issue of proceedings.

Confidence in Ireland as a commercially nuanced legal system is illustrated by the International Swaps and Derivatives Association’s (ISDA) recent publication of a master template agreement governed by Irish law, previously confined to either US, UK or Japanese law.

A post-Brexit Ireland will offer many benefits as a jurisdiction within which to do business and if necessary, litigate. Mr Chief Justice Clarke emphasised that “in all the uncertainty which currently surrounds Brexit….Ireland can provide, not least for those outside the EU in the common law world, a safe haven. In a time of great uncertainty, I would like to think that that safe haven may prove to be a significant advantage.”

For more information on litigation in Ireland, contact a member of our Dispute Resolution team.

The content of this article is provided for information purposes only and does not constitute legal or other advice.

Compliments of Mason Hayes & Curran, a member of the EACCNY