14 September 2017

Denmark accedes to the convention on jurisdiction

On 30 May 2017, the Danish parliament adopted a bill stating that Denmark accedes to the Hague convention on jurisdiction of 30 June 2005 (the Convention on jurisdiction). The bill came into force on 1 July 2017.

The accession of the Convention on jurisdiction implies that Danish citizens and companies will obtain the same legal position in relation to the Convention as the rest of the EU. Below, we will describe the scope of the Convention and the most important changes in relation to the Danish parties.

SCOPE OF THE CONVENTION

The Convention applies to exclusive jurisdiction agreements concluded in international civil and commercial matters. An exclusive jurisdiction agreement is an agreement between two or more parties which stipulates that only the court(s) stated in the agreement is/are competent to hear a specific legal issue. The Convention will only cover the agreement if it is concluded in writing or can otherwise be referred to, and if it gives authorisation to a court in a contracting state.

IMPORTANT CHANGES IN THE LEGAL POSITION

Accession to the Convention will have special impact on the recognition and enforcement of judgments from Danish courts in third countries (countries that are not members of the EU or EEA) and vice versa.

In general, a judgment from a Danish court which is competent under an exclusive jurisdiction agreement must be recognised and enforced in third countries that are contracting parties to the Convention.

Also, a judgement delivered by a court in a third country that is competent to hear a legal issue according to an exclusive jurisdiction agreement must generally be recognised and enforced in Denmark and the other EU Member States. It is a condition, however, that the third country is a contracting party to the Convention. At the moment, the Convention has come into force in Singapore and Mexico. The USA and Ukraine have signed, but not (yet) acceded to the Convention.

THE CONVENTION’S EXEMPTIONS

The Convention contains several exemptions from the basis on access to recognition and enforcement of judgments covered by the Convention. A material exemption is that recognition or enforcement may be rejected if the writ is not served in time or correctly on the defendant. The same applies if recognition or enforcement will be manifestly contrary to fundamental legal principles in the state where the request is filed. Further, a state with a strong interest may declare that the Convention does not apply to a specific legal area.

A special procedure applies (a so-called “exequatur procedure”) in order for a judgment from a contracting state outside the EU/EEA to be enforceable before the Danish courts. It is a requirement that a written request concerning enforcement must be sent to the enforcement court, and that a process agent is appointed in Denmark if the party filing the request is not domiciled in Denmark.

COMMENTS

Denmark’s accession to the Convention implies that Danish citizens and companies may to a greater extent determine where a dispute is to be heard and enforced. Also, the access to Danish judgments being enforced in third countries and vice versa will be expanded.

The access to enforcement may have significant impact on the dispute resolution between Danish companies and foreign contracting parties. The impact will especially depend on whether the USA will accede to the Convention as many Danish companies have American cooperation partners.

Further, the increased access to enforcement means that procedures before the courts will be a relevant alternative to arbitration proceedings in international disputes to a greater extent than before.

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