Monday, 27 April 2015

Some Progress for the Hague Choice of Court Convention

             The Convention of Choice of Court Agreements, which the Hague Conference on Private International Law finished in 2005, received a much needed and deserved boost recently when Singapore signed it.  To date, only three other states have signed: the United States, Mexico, and the European Union.    Only Mexico has ratified it so far, although the European Union is expected to do so soon.  At least two  states must ratify it before it enters into force. 

            The Convention aims to ensure the effectiveness of choice of court clauses, also known as forum selection clauses, in international, cross-border contracts.  The Convention obligates the courts of the jurisdiction specified in the contract to accept jurisdiction, and obligates courts of jurisdictions not chosen by the contracting parties to decline jurisdiction.  As well, courts in contracting states must recognize and enforce judgments issued by the court chosen by the contracting parties.    The Convention applies in international cases to civil and commercial contracts, but exempts employment, consumer, and certain other types of contracts. It applies to contracts with exclusive choice of court clauses, i.e. clauses that require, not merely permit, disputes to be litigated in the courts of a specific jurisdiction. 

            This Convention would benefit Canadians and Canadian businesses as much as anyone else, and thus it is to be hoped that Canada will sign and ratify the Convention soon too.

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