Asymmetric jurisdiction clauses empower English courts to defeat abusive litigation tactics
23 February 2017
Client Alert | International Dispute Resolution
On 3 February 2017, the Commercial Court handed down judgment in Commerzbank Aktiengesellschaft v Pauline Shipping and Liquimar  EWHC 161 (Comm) confirming that asymmetric jurisdiction clauses are valid exclusive jurisdiction clauses for the purposes of Article 31 of the Brussels 1 Recast Regulation (EU) 1215/2012 (the "Recast Regulation").
In making this determination, the Court confirmed that asymmetric clauses can be relied on to defeat abusive litigation tactics, and that the Recast Regulation empowers the English court to proceed in spite of on-going proceedings in another member state.
"Asymmetric" or "unilateral" jurisdiction clauses are extremely common in international transactional documents. They bind both parties to one method of dispute resolution and/or forum, while enabling one of the parties to unilaterally issue proceedings in another.
They are particularly common in international finance transactions, where a bank may wish to prevent a borrower from bringing proceedings in an unfamiliar jurisdiction whilst also maintaining the freedom to bring proceedings in another more convenient forum in the event of a dispute, for example the location of the borrower's assets.
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