Wednesday 3 February 2021 4:48 pm

Exclusive: City law firm chief warns Brexit may damage Square Mile’s ecosystem

Since the turn of the year, London’s outward-looking legal community has rushed to adapt to the new post-Brexit arrangements.

In a wide-ranging, two-part interview, City A.M. sits down with Natasha Harrison, the Chancery Lane-based managing partner of global law firm Boies Schiller Flexner, to discuss the changes that Britain’s departure from the EU has brought to solicitors and legal professionals in the Square Mile and beyond.

Harrison’s firm, which has 11 offices around the world with nearly 400 staff members, represents clients such as Amazon, its soon-to-depart CEO Jeff Bezos and Al Gore. Most recently, Boies Schiller Flexner’s London office was hired by bondholders involved in both Wirecard and McLaren.

Durham University-educated Harrison, a banking and financial services lawyer, became managing partner in 2019 and was listed by Financial News as one of the 100 Most Influential Women in European Finance in 2020.

Following the end of the transition period, with Brexit completed, what ramifications has Britain’s departure from the EU for London’s legal sector? For example, many English lawyers have started registering in Ireland.

The UK’s changing relationship with its largest trading partner post-Brexit foreseeably creates an unpredictable economic environment in which lawyers will practice, in the short term at least. And, for lawyers and parties engaged in the resolution of commercial disputes, the deal reached provides only some relief to the uncertainty. At a sector level, UK legal professionals will face more limited access to the EU legal services market following the transition period. Whilst this has less direct impact on English-qualified lawyers who predominantly litigate before the English courts, it nay have repercussions for disputes involving EU law and law firms with EU establishments.

The [UK-EU] deal reached provides only some relief to the uncertainty

Within the EU, the EU Lawyers Directive provides automatic mutual recognition of legal qualifications. Prior to the end of the transition period, affected UK lawyers sought to requalify as EEA lawyers, such as seeking admission to the Irish roll, although this is now subject to demonstrating a physical presence for practising in Ireland, in order to continue to benefit from this extensive access. Now, post-transition period, the UK/EU FTA helpfully includes express provisions relating to the legal sector, retaining the right for UK lawyers to advise clients across the EU on English law and public international law using their existing professional titles.

How do you envisage Brexit will affect commercial litigation?

Brexit has direct consequences for users of the English court system. In particular, a significant consideration for future litigants will be whether parties can continue to enforce with a relative degree of uniformity and at low cost a judgment of the English court across EU Member States in order to execute against high value assets in different jurisdictions. It also remains possible that in due course the UK will receive consent from the necessary contracting States to fully accede as a party to the 2007 Lugano Convention, which provides reciprocal enforcement access across the EEA similar to the EU’s current regime.

London remains attractive as a global centre for resolution of commercial disputes

Notwithstanding, London remains attractive as a global centre for resolution of commercial disputes, in part because of its developed legal market, the sophistication, efficiency and relative certainty of the English judicial system, and the adversarial nature of proceedings. In this regard, the rules governing the conduct of commercial arbitration and enforcement of arbitral awards exist outside of the EU system, and therefore London-seated arbitration continues to be an option for contentious disputes.

And what about the recognition of court orders and judgments?

There could be a significant impact on cross border litigation in relation to the loss of automatic recognition judgements under Brussels Regulation should provision not be made. However, I don’t believe that will result in clients moving to litigate in Europe as opposed to England, which has one of the strongest and most independent judiciaries in the world. For those lawyers practicing in Europe before the European Commission, there are potentially significant ramifications, but for international disputes firms such as ourselves, we wouldn’t expect any direct ramifications at present.

Do you fear many or some legal frameworks will no longer apply post-Brexit and you will lose access to many European markets, and thus clients?

There is a risk that we will lose some legal frameworks in relation to the Rome Convention and  Brussels Regulation but I don’t believe this will result in a loss of access to European markets or clients. Clients are not going to pivot from taking their cases or international arbitration to English courts in favour of local European Courts where there is a lack of certainty over process. Most legal frameworks will remain the same. Parties will be able to submit their disputes to English law and that choice will continue to be respected by both the English and European Courts. 

There is a risk that we will lose some legal frameworks

Most of the advantages of resolving disputes under English law will remain the same and so we would not expect there to be a significant reduction in the number of parties agreeing to have their contracts governed by English law and so the number of disputes under English law.

And if we look at the next decade orso.

Yes, there are some longer term risks. As the Brussels Regulation no longer applies it is possible that some European courts may seek to engage in judicial expansionism – trying to reduce the number of disputes subject to the jurisdiction of the English courts. The risk of that is limited but not wholly eliminated by the UK’s independent ratification of the Hague Convention. Perhaps more significant is the risk that Brexit will damage the overall ecosystem of the City of London. Part of the reason so much ligation happens in London is because of the central importance of London as a finance hub and its deep reserves of skills and expertise. If increased protectionism and competition in Europe reduces those attractions one might see a knock on effect on London litigation.

Tomorrow part Two of this interview series, in which Harrison will zoom in on the rise of class action suits in the UK.

Share