UK Trends and Developments Contributed by: Jamela Collins, Sukhbir Kaur, Tadgh Kelly and Oliver White, Temple Legal Protection
Temple Legal Protection One Bell Court, Leapale Lane Guildford, Surrey GU1 4LY UK Tel: 01483 577877 Email: info@temple-legal.co.uk Web: www.temple-legal.co.uk
The Post‑Brexit Reality of Insuring UK Litigation: Why Habitual Residence, Not Governing Law or Jurisdiction, Determines Adverse‑Costs Cover The United Kingdom and its Commercial Court contin - ue to occupy a pre-eminent position in the resolution of complex, high-value commercial disputes. Despite repeated predictions that Brexit would erode London’s international standing, recent data demonstrates the opposite. Published analyses of Commercial Court judgments consistently show that a substantial proportion of cases involve non-UK parties. While international liti - gants now account for well over half of Commercial Court participants, European parties alone represent a significant and stable cohort, accounting for approxi - mately 14% of Commercial Court litigation by party nationality in recent reporting periods. This European participation is not incidental. EU- based corporates, financial institutions, insurers, and high net worth individuals continue to select the English courts because of their reputation for judicial independence, procedural efficiency, and doctrinal certainty. English law’s commercial orientation and the courts’ deep experience in managing cross-border disputes have combined to preserve London’s status as a dispute resolution hub notwithstanding the Unit- ed Kingdom’s departure from the European Union. However, the continued attraction of EU litigants to the UK courts has occurred against a backdrop of regulatory divergence in the insurance and financial services sphere. While jurisdiction and governing law questions are routinely navigated with confidence, the same cannot be said of adverse-costs protection. For
EU-resident claimants, access to after-the-event (ATE) insurance is now shaped not merely by market avail- ability but by the interaction between EU insurance law and post-Brexit regulatory boundaries. Choosing the governing law is not choosing the court Notwithstanding the United Kingdom’s withdrawal from the European Union, the legal framework govern - ing the choice of applicable law in civil and commercial matters has remained strikingly stable. Prior to Brexit, the determination of governing law was governed by Regulation (EC) No 593/2008 (Rome I) for contractual obligations and Regulation (EC) No 864/2007 (Rome II) for non-contractual obligations. That position has not materially changed, and both instruments contin - ue to apply in substance in the United Kingdom today. This continuity is the result of deliberate legislative design. Through the Law Applicable to Contrac - tual Obligations and Non-Contractual Obligations (Amendment etc.) (EU Exit) Regulations 2019, Rome I and Rome II were retained as part of UK domestic law, subject only to technical modifications reflecting the United Kingdom’s altered constitutional status. Eng - lish courts therefore continue to apply what are com- monly described as “UK Rome I” and “UK Rome II”. Crucially, Rome I does not depend on reciprocity, with European courts continuing to apply Rome I as a mat - ter of EU law, while English courts apply it as retained domestic law. An English governing law clause there - fore remains effective and enforceable on both sides of the Channel, providing legal certainty for EU parties contracting into the English legal system.
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