Legal development

Are UK-EU anti-suit injunctions back

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    In the post-Brexit world, the Brussels Recast Regulation (EU 1215/2012) no longer applies to regulate new proceedings as between UK and EU 27 Courts, and the Turner and Grovit (EU: Case C-159/02) prohibition on anti-suit injunctions ("ASI") likewise no longer applies.  As a result, UK/EU ASIs are back on the agenda.

    In Ebury Partners Belgium SA/NV ("Ebury") v Technical Touch BV ("TT") & Anor [2022] EWHC 2927 (Comm), Ebury applied for an ASI in respect of Belgian proceedings which had been brought by TT. In answer, TT applied for an order that the English court had no jurisdiction to try the English claim.

    In May 2022, TT had commenced proceedings against Ebury in the Dutch-language Business Court in Brussels. They sought declarations of non-liability and that the relevant Relationship Agreement and Guarantee were void (as well as alleging that Ebury was in breach and seeking provisional damages of €1). TT did not give Ebury prior notice of the intended proceedings.

    The Judge indicated the now settled principles upon which an ASI would be granted were:

    • The court's power to grant an ASI to restrain foreign proceedings, when brought or threatened to be brought in breach of a binding agreement to refer disputes to arbitration, is derived from section 37(1) of the Senior Courts Act 1981, and it will do so when it is "just and convenient".
    • The touchstone is what the ends of justice require.
    • The jurisdiction to grant an ASI should be exercised with caution.
    • The ASI applicant must establish with a "high degree of probability" that there is an arbitration or jurisdiction agreement which governs the dispute in question.
    • The court will ordinarily exercise its discretion to restrain the pursuit of proceedings brought in breach of a forum clause unless the defendant can show strong reasons to refuse the relief.
    • The defendant bears the burden of proving there are strong reasons.

    The Judge indicated that a critical question was whether Ebury could show, with a high degree of probability, that there is was a English choice of court jurisdiction agreement governing the dispute in question. The important issue which arose was whether the jurisdiction clause contained in Ebury's standard terms was incorporated into the agreement between Ebury and TT.

    Ebury issued the English proceedings, together with the ASI application, on 29 July 2022.

    The Judge held that English law rather than Belgian law applied to the question of whether the English jurisdiction clause was incorporated in the terms.

    Accordingly, Ebury had established the relevant jurisdiction clauses, both in the RA and the Guarantee, were incorporated to the requisite standard: a high degree of probability.

    The burden was then on TT to show strong reasons to refuse relief restraining the pursuit of proceedings brought in breach of a forum clause. The judge held that no sufficiently strong reasons have been given.

    TT's argument in favour of the application of Belgian law, notwithstanding that English law is the applicable law of the agreements by express choice, would be based upon Article 3 (3) of Rome I (Regulation on the law applicable to contractual obligations (EC) No 593/2008)1. It was not necessary or appropriate to express even a preliminary view as to whether Belgian law would be applicable as a result of Article 3 (3). There would clearly be a substantial argument on the part of Ebury that the narrow exception to party autonomy did not apply on the facts of the present case. However, even assuming that it would be an issue in the English proceedings, and that therefore Belgian law evidence would be required, that did not provides a strong reason for declining to protect the parties' jurisdiction agreement by granting anti-suit relief. It simply meant that the Defendants have a Belgian law argument.

    In the light of these conclusions on the ASI application, TT's application challenging the jurisdiction of the English court failed.

    Post Brexit, are we likely to see the Italian torpedos skimming below the waves again? Or will they get caught in the ASI net?

    Authors: David Capps and Aneesa Khan

    1. That provides that where all other elements relevant to the situation at the time of the choice are located in a country other than the country whose law has been chosen, the choice of the parties shall not prejudice the application of provisions of the law of that other country which cannot be derogated from by agreement.

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