Guidance Through the Evolving Legal Landscape
Winning a sum in a court case is often considered the toughest part of the legal process. However, after successfully securing the judgment, considerable challenges arise in actually recovering the awarded sum from an unconscious counterparty. This is especially complicated when the person or business that owes the money under the judgment is situated in another country. Therefore, it is crucial to identify as many potential issues that can arise during the enforcement process as possible. Ideally, the complete understanding of where and how the legal ruling will be enforced at the moment of filing the case. Besides identifying the potential judgment debtor and locating its assets, it is essential to distinguish between the two types of potential legal decisions that may be obtained at the outcome: court judgments and tribunal awards, as the steps to enforce them differ. This piece will focus specifically on how to enforce a foreign court judgment in the United Arab Emirates (UAE) or Ukraine. To facilitate the enforcement of the rights and obligations of parties from two different jurisdictions, the concerned states involved in international trade often enter various conventions and treaties in the sphere of judicial cooperation and reciprocal enforcement of each other's judgments. the UAE and Ukraine (States) have entered into several such international agreements. Both States have agreed to recognise and enforce each other's court judgments in civil and commercial matters, as outlined in a bilateral treaty called “On Judicial Assistance in Civil and Criminal Matters” (the Treaty). In the UAE, this agreement was ratified by a law called Federal Decree No. 139/2013, while Ukraine enacted a law for the same purpose, Law No. 337-VII, on June 19, 2013. Basic Provisions of the Enforcement of Court Judgments The Treaty outlines the mutual commitments of the parties to support one another in several key areas: Article 20 of the Treaty specifies certain limitations under which a judgment may not be enforced by a party-State. These conditions include: To limit potential disagreements concerning the exclusive jurisdiction of each country's courts, Article 18 of the Treaty provides rules for determining the States’ jurisdiction, which are essentially similar to those States' national procedural rules. To summarise briefly, the exclusive jurisdiction will be determined when: Practical Steps to Enforce Foreign Judgment To have a judgment recognised and enforced in one of the States of the Treaty, certain documents must be provided, according to Article 22. Specifically, the application for enforcement needs to include: Once these documents are ready, the application must be submitted directly to the appropriate court in the State where the judgment is to be enforced. Notably, when the court in the enforcing State reviews the application, it shall only check if the judgment meets the necessary conditions outlined in the Treaty. They shall not look into the details of the case itself. Hence, the enforcement stage shall not be considered as another opportunity to argue the case. However, if some parts of the judgment are found not enforceable for the reasons already discussed above, the court can decide to enforce the whole judgment or only parts of it if those parts can be enforced separately. Conclusion To put it simply, even though clear rules and guidelines for enforcement are outlined in the Treaty, there are still many important details that require careful attention and particular awareness. Key issues concerning exclusive jurisdiction, the parties’ proper notification and capacity, and some other factors can pose serious impediments to the recovery process. These issues can make it difficult to enforce any final decisions made in court, and need to be addressed before a legal dispute is even initiated. It’s always a good idea to work with a legal expert who understands the laws in both relevant countries. In Aleoprive, we can help ensure that you’re taking the right steps and may suggest alternative strategies for overcoming any difficulties as you work towards achieving recovery.
Cross-Border Contracts: Drafting and Negotiating What is a cross-border contract? A cross-border contract, also known as an international commercial contract, involves parties situated in at least two different jurisdictions. This characteristic is the defining feature of such contracts and carries a number of legal implications. While many national legal systems are working to adapt their regulations to facilitate cross-border trade, certain aspects can only be addressed through written agreements between the parties involved. To provide a better understanding of these contracts, we will explore traditional provisions typically found in commercial contracts, along with specific considerations that apply to international transactions. Key Considerations in Drafting Cross-Border Contracts Parties’ Identification When your counterparty is from a foreign country, it is crucial to obtain as much detailed information as possible about the party, i.e. its legal form, person(s) authorised to act for the company, business address and last but not least, postal address for delivering formal correspondence. Whenever possible, such information should be obtained from official business registers in that party’s country. In today's world, nearly every state looking to attract more foreign businesses has established a government-run companies registry to help identify their counterparts. Examples include the UK's Companies House, the UAE's National Economic Register, and Ukraine's Unified Register of Legal Entities. Each registry offers a specific set of publicly accessible information. However, when dealing with certain jurisdictions, like the UAE, it often requires much more in-depth investigation beyond a simple registry search. The information available through this register, there, is quite limited, typically only including the company name and trade license numbers. Therefore, obtaining additional company documents for further analysis alongside public records is crucial for ensuring a certain level of safety. Choice of Law Another thorough consideration in international transactions needs to be given to the law governing the contract. However, understanding of a legal background in a specific country involves not only an extensive reading of its codes. Often, an essential source of the law, especially in aspects of its interpretation, lies within judicial precedents. This requires review and analysis of an array of court judgments to evaluate the legitimacy and enforceability of a contract. In most cases, this happens to be impractical or demands substantial legal expertise. As a result, when drafting a commercial contract, parties often choose a jurisdiction they are familiar with as the governing law or may leave this clause unaddressed, which can either benefit or disadvantage the parties involved. Compliance with Local Laws Parties involved in a contract must not only be aware of the governing law, but they must also ensure that their agreement complies with the current regulations set by government agencies in the relevant jurisdictions. This includes adhering to local licensing and permit requirements, tax laws, import/export controls, and any industry-specific standards. In a cross-border contract, the parties can assign the risks associated with non-compliance with such regulations. This may include designating a party responsible for any taxes, levies, and fines incurred in a specific jurisdiction or related to a transaction. However, understanding the full range of potential implications is crucial for a successful venture. Jurisdiction and Dispute Resolution When drafting an international commercial agreement, it is important to include provisions for resolving disputes between the parties. Typically, but not always, the contract will specify the courts in the jurisdiction of one of the parties as a venue for any legal action to be taken. As an alternative, some may choose a sustainable neutral country jurisdiction under the belief that a strong rule of law will offer them the best protection. However, this is not always true, as it is not only the formidable law involved that matters, but also how easily a concerned party can access the justice system in such a country. In most cases, to represent a company in legal proceedings requires engaging a local attorney. Therefore, before deciding on a foreign country’s courts, think ahead about how feasible it will be to hire a lawyer who understands your needs without the aid of an interpreter, in places like, for example, Switzerland or the United Arab Emirates. When choosing a jurisdiction for dispute resolution, consideration must, among others, be given to: These factors can significantly impact the outcome of a dispute, even when the governing (substantive) law is favourable. An alternative option is to submit disputes to arbitration. This can eliminate the need for translation and provide a more transparent and understandable procedure, yet not a time- or cost-efficient one. Language International contracts are often drafted in more than one language. In bilingual agreements, it’s essential to specify the authoritative version of the contract and, if needed, ensure accurate translations are provided to avoid misinterpretations. Cultural Sensitivity Sensitivity to different business practices and communication styles can impact discussions and lead to misunderstandings. This is especially the case when the parties’ native countries have different legal systems, such as Common Law and Civil Law jurisdictions. Here, the level of detail to be discussed and agreed upon can vary drastically. Nevertheless, robust contractual provisions setting out each party’s rights and obligations can work out most of the uncertainties regarding how the parties have treated each stage of contract performance at the time of entering into it. Conclusion A well-drafted contract that considers the unique challenges of international transactions ensures clarity and protects the interests of all parties involved. To secure these aspects, in addition to all standard clauses pertinent to a particular type of transaction, it is prudent to negotiate and include: Businesses looking to expand into international markets need to pay attention not only to the commercial aspects of their agreements but also to the legal complexities that come with operating in different jurisdictions. Engaging a legal professional early on is always advisable, as this can help establish effective dispute resolution and recovery measures. Most importantly, it can prevent many potential issues from arising in the first place.
Where to File Legal Action in Commercial Dispute with a Foreign Party Cross-border commercial disputes, with their wide range of issues, demand a thorough evaluation on a case-by-case basis. From straightforward trade or corporate disagreements to significant failures in natural resource management and major construction projects, the complexity of a case necessitates a meticulous approach. This article delves into the most basic and relatively uncomplicated matters that involve two parties located in different jurisdictions, with transactions that may occur within their respective states or involve the cross-border transfer of goods or services. Initial Considerations In an ideal scenario, where the parties have thoroughly negotiated and executed a commercial contract , the process for dispute resolution is typically outlined in great detail. This roadmap, embedded within the contract, normally allows the parties to avoid most of the potential pitfalls . In such cases, the parties need to follow the specified steps to escalate their issues and engage with the designated dispute resolution body according to the terms of the contract . A different approach is required when the parties have conducted their business using basic commercial documents, missing the jurisdictional clauses or any guidelines regarding how and where disputes should be resolved. Looking for a correct course of action Whenever the contract provides, it is essential to comply with the dispute resolution mechanism selected by the parties . As a general rule, the contract prescribes that disputes be resolved by the courts of the state of one of the parties or by arbitration ( venue of the dispute). In addition to a dispute venue , the contract often sets out pre-action procedures that are essential to observe. Pre-legal steps Pre-legal steps are crucial to the parties in most jurisdictions and often are advantageous as well. This phase can facilitate the reconciliation of accounts, potentially leading to an early recovery of the agreed-upon outstanding amounts. On the other hand, bypassing this pre-litigation stage— even when it is apparent that resolution in this manner is unlikely—may result in the court or tribunal dismissing the case without consideration of its merits . To ensure a thorough approach at this stage, the following key questions should be answered: All these questions should be answered by conducting a thorough review of the written agreement. This comprehensive understanding of the dispute resolution process, as outlined in the agreement, is crucial. In the absence of clear guidance in the agreement , the procedural rules of the country where the case will be litigated need to be consulted. In most scenarios, the next step will be to serve a contractual notice of dispute to the defaulting party. The contract can also stipulate a waiting period or mandate active engagement in settlement discussions or go into mediation . It is essential to take all necessary steps in compliance with the required formalities before advancing the legal claim. Addressing Relevant Authorities Certain disputes must be presented to the concerned authorities prior to being escalated to a court or tribunal, regardless of whether this requirement is explicitly stated or omitted within the contract. This step is particularly crucial in jurisdictions that impose specific protocols for certain disputes. For instance, in the case of matters arising from insurance contracts in the United Arab Emirates, it is mandatory to initiate proceedings with the Federal Insurance Authority first. Neglecting to adhere to such requirements may result in the dismissal of the case purely on procedural grounds . Filing a Case After attempting all pre-legal steps and measures, there may still be a need for one party to secure a formal, enforceable order— a court judgment — to recover under the contract . When selecting the court to initiate your legal proceedings, several key factors need to be taken into account: Ideally, the contract will direct the dispute to the courts of a country where the judgment shall be subsequently enforced . Suppose a court judgment from one country must be enforced in another . In that case, it's crucial to review any international treaties that allow for the mutual enforcement of court judgments and documents between the relevant jurisdictions. Key treaties may include: The Hague Convention "On the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters", as between Ukraine and England; and The Bilateral Treaty "On Judicial Assistance in Civil and Criminal Matters" between Ukraine and the UAE. Besides committing to respect each other's court judgments, the treaties also provide valuable guidance on procedural matters that could affect the judgment's enforceability in either country. The country where the dispute is adjudicated is important not only for litigation but also for arbitration. In arbitration, the legal seat will determine how procedural aspects are handled. Unlike litigation, arbitration does not require proceedings to be physically held at the legal seat, and parties enjoy greater flexibility in choosing their representation . If arbitration isn't an option, the claimant must file their case in a state court that is competent to hear the subject matter under local procedural law . Choosing the right court can be more complex than it seems at first. Claimants might instinctively think that the jurisdiction lies with the country's most prominent court, such as the Dubai Courts in the UAE. However, upon further examination, they may find that the defendant is located in Sharjah or Ras Al Khaimah, or that a significant part of the contract was performed there , leading to the lack of jurisdiction by the Dubai Courts. Even greater confusion can arise when deciding between the Commercial Court of Kyiv City and the Commercial Court of Kyiv Oblast. The weight of this decision and its potential consequences for the case cannot be overstated. Representation in Court In Ukraine and the UK, the lower courts permit parties to represent themselves . For corporate entities, this representation can be handled by management bodies, such as a general manager. To make the process more accessible, these courts allow parties to file and defend cases remotely using electronic means of communication . However, while this may be manageable in a familiar jurisdiction, self-representation could introduce unnecessary challenges during litigation and the execution phase, especially for cases that hold substantial value or significance to the party involved. Therefore, when the stakes are higher, it's always advisable to involve a local practitioner for guidance and support. Enforcement of the decision See our article about foreign judgments enforcement
In July 2025, the Hague Convention came into effect in the UK. The Convention presents an efficient mechanism of recognition and enforcement of judgments between the contracting countries. In accordance with the preamble, it will facilitate access to justice and enhance chances of recovery in cross-border transactions for international market participants. The Convention effectively abandons the need for review of the underlying disputes when enforcing judgments from countries different from where it is being implemented. Providing that the court has passed its decision within its powers as defined by the rules of jurisdiction, the grounds for refusal of enforcement of such judgments are limited to very few reasons outlined in Article 7 of the document. The Convention, however, explicitly excludes judgments in a number of areas, which still remain subject to an exclusive jurisdiction, special scrutiny, or different rules for the enforcing courts. Among these are matters arising from insolvency, intellectual property, defamation, privacy, competition law, family law, carriage of passengers and goods and arbitration-related judgments. In addition to the UK, other countries that have joined this agreement include EU nations (except Denmark), Ukraine, and Uruguay. Overall, the adoption of this convention marks an important step in providing greater certainty and predictability for businesses and individuals engaged in international legal matters, making cross-border enforcement of obligations more definitive.