Will the UK's withdrawal from the European Union
affect London's position as a pre-eminent seat of international
arbitration? And which European city could be vying to take its
In part two of our video series, Breaking Brexit Down,
Corrs Partner Bronwyn Lincoln takes a closer look at the
implications of the UK's momentous decision and considers how
it will impact on international arbitration.
What are the immediate challenges for the UK, EU and the wider
Will restrictions on freedom of movement affect international
What should businesses keep in mind, as the terms of the
withdrawal are negotiated?
Over the coming weeks we'll bring you insight from Corrs
Partners who'll examine areas ranging from competition law to
privacy, trademarks, regulation and more.
Look out for more episodes in this series, as Corrs Partners
consider the key issues which will affect the ways in which
Australian firms and their networks do business.
We'll examine the challenges that will come with the
changes, while also exploring the potential opportunities that
International arbitration is a little bit of an unknown, as are
so many elements of the economy and politics and business as a
result of Brexit. What we do know is, it's creating uncertainty
and wherever there is uncertainty in an economy you tend to get
more disputes and you get parties who are bringing matters to
disputes quicker. They take the view that, 'well, we better try
to recover our damages now, we better enforce our rights now, we
won't wait, we won't negotiate, we'll go straight into
it.' So, it's quite possible that there will be an increase
in international arbitration.
London is one of the most popular seats for international
arbitration – international commercial arbitration – in
the world and it has been for a long time. Partly historical,
partly because of where it's located geographically, it has
such a well-regarded judiciary, legal fraternity and the
infrastructure that you need for a solid and certain arbitral
What we might see changing is the perception of the business
community when they are looking for a centre and at a more
practical level, things like visa's might be more difficult for
business people to obtain to go into London. So that might change
how often it is selected as a centre. But the way that the arbitral
institutions – for example the London Court of International
Arbitration, administer arbitration – that is not going to
change. They will continue with the high standard that they are
There are a number of cities around the world that would love to
have the place that London has had in the international arbitration
community for a long time. Frankfurt is one of those if you are
looking specifically in the northern hemisphere and in Europe. It
is very well placed. I have spoken to colleagues in the US and who
have done work with US clients who suggest that that is where they
would look to. The planes from the US apparently fly largely to
Heathrow and Frankfurt, so it's perfectly placed. People speak
English and, of course, it's in the centre of Europe.
But there is another side to it to. It's not all down side
for London and in thinking about where London is at the moment in
the arbitration world and comparing it to, for example, Singapore.
Singapore is not part of an economic community such as the EU but
it has been highly successful in establishing itself as a centre
for international commercial arbitration. There may be lessons that
London could learn from Singapore after Brexit is implemented.
Businesses who have traditionally looked to London as their
place for arbitration now need to reconsider whether that is the
right place for them in the context of what is happening. The
relationship of the UK to the EU in the next two to five years is
uncertain. No one quite knows where it will land but what it means
is if you have a contract which at the moment has an arbitration
clause in it which identifies London as the seat then when a
dispute arises you need to look at that clause. You need to ask
yourself whether, given what is happening at the time the dispute
arises, it's still the right place. Can you get there easily?
Does London still have the infrastructure that you need to run your
arbitration? All those questions need to be foremost in your
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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PNG has domestic arbitration legislation, but does not provide for the enforcement of foreign arbitral awards.
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