Anti-suit injunctions to restrain proceedings in EU courts

The Commercial Court’s decision in Ebury Partners Belgium SA/NV v Technical Touch BV & Anor [2022] EWHC 2927 (Comm) illustrates how, post-Brexit, English courts can now grant anti-suit injunctions to restrain proceedings in EU courts brought in breach of an exclusive English jurisdiction clause and the principles they may apply in considering ordering such relief.

Background

Prior to Brexit, the English court could not grant an anti-suit injunction to restrain proceedings in EU courts which had been brought in breach of an exclusive English jurisdiction agreement. The European Court had held that such relief was incompatible with the Brussels Recast Regulation (the “Regulation”), which continues to apply between EU Member States. The Regulation controls which Member State court has jurisdiction to hear a particular dispute and provides the mechanism for how this is determined. Anti-suit injunctions were considered to interfere with this regime.

Now that the UK is outside of the Regulation regime, such considerations no longer apply and anti-suit injunctions are available.

Court’s decision

The case concerned an agreement between two Belgian entities for the provision of foreign exchange currency services. The defendants had ticked the box on the claimant’s online application form to agree to the claimant’s terms and conditions. Those terms provided for the agreement to be governed by English law and any dispute to be subject to the exclusive jurisdiction of the English courts. However, the defendants did not access the terms and conditions on the claimant’s website at the time. A dispute arose when the defendants failed to make certain payments due to the claimant. In breach of the exclusive jurisdiction agreement, the defendants started proceedings in the Belgian court seeking negative declaratory relief. The claimant brought proceedings in the English court and applied for an anti-suit injunction against the defendants to restrain the Belgian proceedings.

The judge granted the anti-suit injunction. The decision contains a useful discussion of some of the principles relevant to whether the court will exercise its discretion to grant such relief. In particular:

1. an applicant must establish with a “high degree of probability” that there is a jurisdiction agreement which governs the dispute in question.

   For example, in this case, the defendants unsuccessfully sought to argue that the jurisdiction agreement had not been properly incorporated into the contract. Applicants should also consider whether the scope of the clause is broad enough to cover the particular dispute.

2. The court will ordinarily exercise is discretion to restrain the pursuit of proceedings brought in breach of a jurisdiction clause unless the defendant can show strong reasons to refuse the relief, and the burden is on the defendant to show this. The defendants could not show strong reasons in this case. The judge emphasised that it is not open to a respondent to argue about the relative merits of fighting an action in the foreign jurisdiction, as compared with fighting an action in England, where the factors relied on would have been foreseeable at the time that they entered into the contract. For example, factors such as where the parties are based, the location and language of documents, the location of witnesses, which proceedings are more advanced etc. Nor is it necessary for an applicant to show that England is the natural forum.

The judge also dealt with the defendants’ argument that an anti-suit injunction would not be supported by the Belgian court and therefore might not be effective. He commented that it is not the habit of the English court in considering whether or not it will make an order to contemplate the possibility that it will not be obeyed. In any event, there was no clear evidence from the defendants that they would in fact disobey an anti-suit injunction granted by the English court. Further, if an injunction is disobeyed, there are effective measures applicants can take. If the respondent disobeys the injunction they may be debarred from defending the claim in the English court. The respondent may also have debtors or other assets within the jurisdiction which could be liable to confiscation. 

Key takeaways

Post-Brexit, the English court will exercise its discretion to restrain proceedings brought in EU and non-EU countries unless the respondent can show strong reasons why the court should refuse the relief. The availability of such relief is an important tool for claimants who find a jurisdiction clause has been ignored.