Will the primacy of English law will remain for international contracts following Brexit

Part of our series: What does Brexit mean for lateral hires?

A growing fear among junior lawyers in the UK is that English law will cease to maintain its primacy as the lex contractus for international conflict resolution. As the EU’s only common law system, it is often included in international commercial and finance contracts as the choice of governing law, even though the parties to the contract have little or no connection to the UK. This is generally accepted to be due to:

– English being a global business language
– Legal certainty as a result of common law precedent and literal interpretation when compared with more purposive civil law methods of interpretation
– Quality and commercial acumen of judges and legal service providers
– The influence of common law on global legal systems

For this reason, many non UK national EU qualified lawyers elect to invest in sitting for the Qualified Lawyers Transfer Scheme (QTLS) which allows them to qualify as a solicitor of England and Wales without completing the full certification required by the SRA. Some now fear that English law will face an uphill battle to remain relevant in a post Brexit environment, rendering the choice to work in the UK as less attractive.

The Law Society stated in its pre-Brexit 2015 report “The EU and the Legal Sector” there for the reasons stated above that English law is, and thereby English courts will be, likely to remain involved at the forefront of the international legal practice for major cross border corporate and finance transactions.

Other experts and legal commentators have also voiced their support for the continuing primacy of English law in major cross border corporate and finance transactions. While Holman Fenwick Willan partner Damian Honey has stated that “English law remains a safe and responsible choice for both contractual and non-contractual disputes”. Allen & Overy litigators Karen Birch and Sarah Garvey believe that “English law is currently a popular, if not the most popular, choice of law for parties to cross-border commercial contracts worldwide”. We think it is a safe bet to wager that stable and commercially oriented English law will remain as relevant in a post Brexit environment.

The one major nuance to this view would be a challenge to the rules of private international law (PIL) in the UK. Given our present dependency on EU PIL Regulations, the effect of a ‘clean-break’ Brexit on PIL will be profound: what we in the UK presently understood to be ‘our’ private international law will cease to apply unless positive legislative action is taken. A challenge to current regulations would have a significant impact on cross-border matters as diverse as family law, civil and commercial claims and insolvencies. This would certainly undermine the traditional primacy of English law for major cross border corporate and finance transactions

In order to counter these risks before they arise, legislators in the UK should consult on this matter and then act to minimise the PIL risks of Brexit for their citizens. The Brexit negotiations could – if the matter is placed high enough up on the agendas of each side and is pursued with sufficient determination by the UK – lead to the UK being able to retain the benefits of some of the existing EU PIL Regulations on some sort of a reciprocal basis by also allowing those in the 27 State version of the EU the possibility of using their EU PIL ‘rights’ within the post-Brexit UK. However, like many other matters in the Brexit melting pot, all of these may end up the victim of horse-trading with a 27 strong set of adversaries at the negotiating table.

You can read our other predictions for how Brexit will impact the careers of UK lawyers here:

Brexit and what it means for UK lawyers
The background to a post-Brexit legal jobs market
Practice areas that will face threat and opportunity following Brexit
The impact of Brexit on UK lawyers’ rights to work in the EU

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