Will Brexit have any significant long-term effect on the English arbitration market? The consensus amongst commentators is no: it will largely be business as usual. The advantages of London-seated arbitration do not derive from EU law or from UK membership of the EU, and will remain in place after the UK exits the EU. We give five good reasons for this level of confidence.


01 | Brexit will not diminish the many advantages of London as a seat of arbitration


Where an arbitration is seated influences the efficiency and effectiveness of proceedings, the availability of court measures in support of arbitration, challenges to awards, and the enforceability of awards. The choice of seat is therefore of critical importance.

For some time, London has enjoyed an almost unrivalled status as one of the most popular seats of arbitration. Parties frequently choose to resolve international disputes by London-seated arbitration, even where the parties have no connection to, and the contract was neither made nor performed in, the UK. London’s success as a seat of arbitration can be attributed to certain features of English law and the confidence of parties in the English judicial system, its efficiency, impartiality and effectiveness.


02 | Brexit will have no impact on the enforcement of English arbitration awards


The UK’s withdrawal from the EU will have no impact on the enforcement of English arbitration awards in EU countries (or elsewhere). Generally, parties seeking recognition and enforcement of arbitral awards do so under the New York Convention. There are 157 states that are signatories to the New York Convention, including all 28 EU member states. The Convention does not depend on EU membership, and so enforcement of English awards in EU countries under its provisions will be unaffected by Brexit.


03 | Brexit might enable English courts to issue EU-wide anti-suit injunctions again


Historically, the English courts had demonstrated a willingness to act in support of arbitration and to protect their own jurisdiction by issuing anti-suit injunctions to restrain parties who brought court proceedings in breach of an arbitration agreement or an exclusive jurisdiction clause. However, EU law severely curtailed the English courts’ power to do so where the offending court proceedings have been brought in an EU member state. (The English courts can and do still issue anti-suit injunctions in respect of proceedings before non-EU courts.) The Court of Justice of the European Union (CJEU) has long held that intra-EU anti-suit injunctions are incompatible with EU law.


04 | Brexit may spark a rise in London-seated arbitrations


Exactly when the UK will give notice of its withdrawal from the EU is still not known. It is clear, however, that the process of withdrawal and negotiation with EU Member States will take a number of years. In the meantime, prior to the UK’s withdrawal, little will change for the English arbitration market. Existing arbitration clauses specifying London as a seat of arbitration will continue to operate as before.


05 | The forecast is business as usual for the English arbitration market after Brexit


At this stage, Brexit is not expected to have any real impact on the English arbitration market. In the long term, the consequences are less predictable. London’s status as a global centre for dispute resolution is undeniably influenced by its role as an international business hub, so if Brexit does have an impact on the UK’s global trade and economy as a whole that may have a knock-on effect – but this is expected to be minimal.

The original press release can be found here on the Norton Rose Fulbright website