The Lugano Agreement: What is It and How Does it Affect International Litigation?
The Lugano Convention, also known as the Lugano Agreement, is a treaty that governs jurisdiction and the recognition and enforcement of judgments in civil and commercial matters between the European Union (EU) and three European Free Trade Association (EFTA) countries: Iceland, Norway, and Switzerland.
The Lugano Agreement was first signed in 1988 and was updated in 2007. It aims to simplify and harmonize the rules on jurisdiction and the recognition and enforcement of judgments between EU and EFTA countries. The Convention establishes the principles of mutual trust and respect between the signatory states, where they recognize each other’s legal systems and the judgments made by their courts.
One of the main provisions of the Lugano Agreement is the principle of “lis pendens”, which means that if there are two or more proceedings relating to the same matter in different signatory states, the court that is first seised of the matter has jurisdiction to hear it. Additionally, the Convention provides rules on jurisdiction for specific types of disputes such as consumer contracts, employment contracts, and individual contracts of insurance.
The Lugano Agreement also includes rules regarding the recognition and enforcement of judgments made in other signatory states. A judgment made in one of the signatory states is recognized and enforceable in the other signatory states without the need for a special procedure. However, recognition and enforcement can be refused in certain circumstances such as if the judgment is contrary to public policy.
The Lugano Convention is significant for businesses operating in the EU and EFTA countries as it provides a framework for resolving cross-border disputes. By establishing harmonized rules on jurisdiction and the recognition and enforcement of judgments, the Convention provides legal certainty and predictability for businesses and individuals alike.
In conclusion, the Lugano Agreement is a treaty that governs jurisdiction and the recognition and enforcement of judgments in civil and commercial matters between the EU and three EFTA countries. The Convention establishes the principles of mutual trust and respect between the signatory states, simplifying and harmonizing the rules on jurisdiction and the recognition and enforcement of judgments. It is significant for businesses operating in the EU and EFTA countries providing them with legal certainty and predictability.