Is it possible to enforce a judgment from a different country in Denmark?

In September 2018, Denmark acceded to the Hague Convention on Choice of Court Agreements. In other words, since 2018, it has been far easier for businesses to enforce their foreign judgments in Denmark by the Danish courts

In addition to the enforcement of judgments, the convention allows for binding agreements on choice of jurisdiction (forum selection clauses) in civil and commercial matters. It has always been possible for two parties to agree to a certain forum in a contract – e.g. “arbitration in London”, or the “ordinary district courts in Copenhagen”. So what has changed? The change is that the parties can now be certain that all courts will actually respect such a choice of forum clause. At least if it is a court governed by the Hague Convention (2018).

What you should know:

• Enforce judgment regarding civil and commercial matters, which were delivered in other member State of the Convention, can be recognized and enforced in Denmark.
• Danish judgements regarding civil and commercial matters can be recognized and enforced in other member States of the Convention.
• Member States of the Convention will respect your choice of forum, i.e. a Court from a member State will dismiss the case if the parties have made an express choice of another court or country.

In short, foreign judgments can be enforced in Denmark, and Danish judgments can be enforced abroad in any of the contracting states of the Choice of Court Convention.

With the recent accession and ratification from Denmark and Montenegro, the Choice of Court Convention now has 32 contracting parties, including the EU.

The courts of the Contracting States will:

• Respect the exclusive jurisdiction clauses in favor of the courts of other Contracting States
• Recognize and enforce judgment from courts of other Contracting States.

In short, foreign judgments can be enforced in Denmark, and Danish judgments can be enforced abroad in any of the contracting states of the Choice of Court Convention.

The convention applies to almost all types of judgments within the scope of civil- and commercial matters.

There are a few exceptions to the rule. For practical purposes, the only relevant exception can be found in Article 2 of the Convention. Article 2 excludes certain types of matters from recognition and enforceability including:

• Consumer cases
• Employment cases, including collective bargaining agreements, and
• Family law matters, wills and succession to name a few

You can review the full list of exceptions in Article 2 here.

In addition to excluded matters, there is a general exception for matters that are incompatible with the public policy or “ordre public” of the requested State (Article 9). Such “public policy”-exception does not carry any practical relevance.

Background of the Hague Convention on Choice of Court Agreements

The Hague Convention on Choice of Court Agreements came into force in 2005 with the aim to promote international trade and investment, by encouraging judicial co-operation and the enforcement of foreign judgements.

The Convention applies to international civil and commercial cases, except for matters that fall out of scope as mentioned above.

The key features of the Convention are i) a court expressly selected by the parties shall conduct the proceedings as long as the choice of court agreement is valid; ii) any other court must dismiss the case to avoid parallel proceedings; and iii) a judgement rendered by the court of a Contracting Party must be recognized and enforced by the courts of other Contracting Parties.

For example, two companies, one German and the other Danish (both from Contracting States of the Hague Convention) have a commercial contract between them that includes a choice of court clause in favor of the Danish courts. If a dispute arises between the parties concerning the commercial contract, the Danish courts will be the competent jurisdiction to hear the case. Thus, if one of the parties files a lawsuit in the courts of another jurisdiction, for example in Germany, the German court will have to dismiss the case, on the grounds of the express choice of court agreement made by the parties. Once the Danish court has decided on the case, the subsequent judgement will be recognizable and enforceable by the German courts, as well as by any other court from a Contracting State of the Hague Convention.

Prospective of the Convention

The Danish ratification of this Convention is significant for judicial cooperation, as it eases the recognition and enforceability of judgements between Contracting Parties, in a similar way as the New York Convention does for the enforceability of foreign arbitral awards. Thus, the Hague Convention can create an impact on how the commercial parties see litigation as a means for dispute resolution at the international level, in comparison with arbitration. Especially, when signatory States that have not yet ratified the Hague Convention, e.g. US, People’s Republic of China and Ukraine, ratify, the Convention will have a greater impact in international trade.

We always recommend contacting an experienced attorney in international commerce to evaluate the particular contract and dispute resolution clauses in order to choose the law and forum, which would be most beneficial to your business in the future whether you are a company doing business with Danish partners or a Danish company crossing the border in your exportation efforts.

Do you want to hear more about dispute resolution methods? Contact our experts Nicholas Ørum Keller, Baker Tilly Legal.