Ireland can be hub for dispute resolution after Brexit, says judge

Brexit will create a significant opportunity for Ireland to become a centre for international dispute resolution, the Chief Justice, Frank Clarke, has said in a speech in the United States.

Currently London is a major hub for dispute resolutions involving US corporations and others doing business in the European Union.

This is because England is a common law jurisdiction just like the US, and the rulings of its courts have effect across the European Union.

Ireland is the second-largest common law jurisdiction in the EU, after the UK. In common law jurisdictions a lot of the law arises from court rulings rather than acts of parliament.

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In continental Europe, most of the laws arise from legislation passed by parliament. In such civil law jurisdictions, court proceedings are inquisitorial rather than adversarial, as they are here.

Post-Brexit, Ireland will be the only EU jurisdiction where English is the spoken language, common law operates, and court rulings will be of consequence across the EU.

Attractive

This could make Irish law particularly attractive for dispute resolution involving US corporations trading in the EU, and other international arrangements.

Mr Justice Clarke, in a speech at Fordham University in New York, said there is an opportunity for Ireland to act in a significantly expanded way in dispute resolution in international litigation, including insolvency, where both the common law and recognition throughout the European Union are of importance.

However, there will also be challenges for Ireland as it will have to play a leading role, post-Brexit, as the main common law jurisdiction remaining within the EU.

Work that up to now has been done by the UK and its judiciary in representing the interests of common law jurisdictions will fall mainly on Ireland if the UK leaves the union. Ireland will have to do more work in relation to influencing new EU law and staffing of EU courts and other legal bodies.

There must, of course, Mr Justice Clarke said, remain “some possibility that Brexit will not happen”, but by far the most likely outcome was that the UK will leave.

Uncertainty

Contracts that are currently being signed are affected by the uncertainty that already exists about where any dispute in the future will have to be resolved.

The expiry of the Article 50 EU withdrawal notice period in March of next year could lead to a “fairly chaotic departure” if there is no agreement reached with the EU, he said.

The “political red line” issue identified by the UK government which suggests that the UK will not accept the jurisdiction of the EU Court of Justice, which oversees EU law, in any future arrangements, creates a significant difficulty.

In a paper accompanying the speech, it was stated that in a no-deal Brexit situation, the UK will face difficulties with continuing to participate in the European Arrest Warrant (EAW) system. This is because the system involves reciprocity between judicial systems. It seems likely, the paper said, “that in the absence of any explicit agreement on continued judicial co-operation in criminal matters, the UK will lose out on the benefits provided by the expedited EAW system.”