Cross-Border Litigation Lawyers in Cyprus

Where the dispute belongs is often the outcome

A jurisdiction clause is read first and taken seriously.

Within the European Union, Regulation 1215/2012 decides which member state’s courts hear a civil or commercial dispute. The general rule is the defendant’s domicile, and where a Cyprus court has jurisdiction under the Regulation it cannot decline it in favour of a supposedly more convenient forum. Parties can choose their court in advance, and a valid choice of court is exclusive unless agreed otherwise.

Where two courts are seised of the same dispute, the first seised generally has priority, with one exception that matters in practice: a court chosen by an exclusive jurisdiction clause may proceed even if the other side filed elsewhere first. Racing to issue is therefore sometimes a strategy, and sometimes a waste of money, and the clause decides which.

Those rules have article numbers, and knowing them shortens the argument. Article 4(1) is the general rule: persons domiciled in a member state shall, whatever their nationality, be sued in the courts of that member state. Article 25(1) governs the clause: where the parties have agreed on a court, that jurisdiction is exclusive unless they agreed otherwise, and the agreement must be in writing or evidenced in writing, or in a form matching the practices the parties have established between themselves, or, in international trade, in a form matching a usage they were or ought to have been aware of. Article 25(5) then severs it: a jurisdiction agreement forming part of a contract is treated as an agreement independent of the other terms, and its validity cannot be contested solely on the ground that the contract is not valid.

The race itself is Article 29(1): where proceedings involving the same cause of action and between the same parties are brought in different member states, any court other than the court first seised must of its own motion stay its proceedings until the jurisdiction of the first court is established. The exception is Article 31(2): where the court on which an Article 25 agreement confers exclusive jurisdiction is seised, any other member state court must stay its proceedings until the chosen court declares that it has no jurisdiction under the agreement. That is the provision that defeats the tactical filing, and it is why the wording of the clause, not the date of the writ, usually decides the point.

Outside the Regulation, the answer depends on the contract, the defendant and where the events happened. Fighting about the forum for two years is a result in itself for the party that benefits from delay, which is why the question is answered before the claim is drafted.

Enforcing a foreign judgment in Cyprus takes one of three roads

The choice of route affects speed, cost and the defences available to the debtor.

Judgments from EU member states circulate under Regulation 1215/2012 without any declaration of enforceability: the creditor presents the judgment and the standard certificate and moves to execution, with refusal confined to narrow grounds such as public policy and lack of service.

The mechanism is worth stating precisely, because it is what makes the EU route quick. Article 36(1): a judgment given in a member state is recognised in the others without any special procedure being required. Article 39: a judgment enforceable in its own member state is enforceable in the others without any declaration of enforceability. Article 42(1) lists what the creditor hands the enforcement authority, and it is two documents: a copy of the judgment satisfying the conditions necessary to establish its authenticity, and the Article 53 certificate certifying enforceability and containing an extract of the judgment, with information on recoverable costs and the calculation of interest where relevant. Article 43(1) sets the one step that must come first: the certificate is served on the person against whom enforcement is sought before the first enforcement measure, accompanied by the judgment if that has not already been served.

The narrow grounds are Article 45(1), and there are five: recognition manifestly contrary to public policy in the state addressed; a default judgment where the defendant was not served with the originating document in sufficient time and in such a way as to enable them to arrange a defence, unless they failed to challenge the judgment when they could have; irreconcilability with a judgment between the same parties in the state addressed; irreconcilability with an earlier judgment on the same cause of action between the same parties elsewhere; and conflict with the protective jurisdiction rules for insurance, consumer and employment matters where that party was the defendant, or with the exclusive jurisdiction rules. Article 45(3) closes the door on the rest: the jurisdiction of the court of origin may not be reviewed, and public policy may not be applied to the jurisdiction rules. Article 52 closes it on the merits: under no circumstances may the judgment be reviewed as to its substance.

Judgments from countries with which Cyprus has a treaty are registered under the Foreign Court Judgments (Recognition, Registration and Enforcement) Law, Law 121(I)/2000, by summons supported by affidavit, on a short statutory timetable and with limited grounds of opposition. The statute reaches enforceable interim orders as well as final judgments.

Judgments from everywhere else are enforced at common law, by action on the judgment as a debt: the judgment must be final and conclusive, for a fixed sum, from a court that had jurisdiction, and not contrary to Cyprus public policy. There is no re-trial of the merits on any of the three roads.

Arbitral awards travel more easily still. Cyprus has ratified the New York Convention, and an award, wherever made, is recognised as binding and enforced on written application, with refusal confined to the Convention grounds. The full picture is in our article on enforcing foreign judgments and arbitral awards in Cyprus.

Cyprus orders in aid of foreign proceedings

By the time the foreign judgment arrives, the account that mattered is usually empty.

Foreign litigation regularly needs something from Cyprus while it is still running: assets frozen before they move, information from a Cyprus company or bank, service on a Cyprus entity. Cyprus law provides for exactly this. The courts’ statutory power to grant interim orders extends to proceedings outside the jurisdiction, and for arbitration the court has the same powers of interim protection whether the seat is in Cyprus or abroad.

In EU matters, the Regulation itself preserves the power of Cyprus courts to grant provisional and protective measures even where another member state’s courts have jurisdiction over the merits.

That is Article 35, and it is short enough to quote in substance: application may be made to the courts of a member state for such provisional, including protective, measures as may be available under the law of that member state, even if the courts of another member state have jurisdiction as to the substance of the matter. It is the article that lets a Cyprus freezing order support proceedings running anywhere in the Union.

This is where Cyprus counsel earns its place in a foreign team, and it is time-critical work. The freezing side of it has its own page: see Freezing Orders in Cyprus, and where the underlying claim is fraud, Fraud and Asset Recovery in Cyprus.

Small roles, done properly

Not every cross-border matter is a dispute.

Where a foreign contract needs a Cyprus address for service, see Cyprus Process Agent. Where a foreign law firm needs Cyprus proceedings issued, evidence obtained, or a Cyprus opinion for a foreign court, we act as local counsel with reporting in the rhythm the lead firm expects: see our page for international law firms.