Who Uses The Commercial Court? – 2013

Today, Portland’s Disputes Unit launched research showing that foreign litigants are outpacing British parties in the Commercial Court.

From 2009 to 2012, foreign parties in the English courts increased by 30 percentage points while British parties decreased 11 percentage points. Over the past five years, 35 per cent of litigants were British and 61 per cent foreign (four per cent were unknown).

This research confirms the prominence of London as a centre for global justice and suggests that growth of the legal services industry will increasingly be driven by work from overseas.

Justice Secretary Chris Grayling has launched an initiative to promote UK Justice abroad, saying: “Our courts and judiciary command great respect around the world and we should be proud of their international reputation and the contribution they already make to our economy.”

In contrast to the positive energy about the legal sector’s growth, the blockbuster Berezovsky v Abramovich case debuting the new Rolls Building generated scathing media coverage questioning why the English courts were hearing these cases, whether they damaged the credibility of the courts and if they squeezed out British litigants.

Portland’s Disputes team operates at the intersection of the legal world and media. Through our work on major cases at the commercial court, it became clear that there was a knowledge gap on the key issue of Court usage. Reporters and other observers were simply unable to point to any objective record of where litigants were actually coming from.

This need for concrete data forms the background to Portland’s “Who uses the Commercial Court?”, a study of all 705 Commercial Court judgments between March 2008 – March 2013. These judgments, augmented by research to identify the nationalities of the parties, reflect a legal action that has advanced past initial stages, and when reviewed over years, we get a substantive picture of the nationalities in the UK court system.

Some media have estimated that anywhere from 50 to 60 per cent of the court’s work involved Russian and Central/Eastern European parties. In reality, that figure for the Commercial Court is only 3 per cent for Russia and 6.6 per cent for Eurasia (Russia, Kazakhstan, Armenia and Georgia). Moreover, after peaking in 2011, litigants from the region have dropped 39 per cent.

The undeniable story for the UK legal sector is that the English justice system remains a credible and influential jurisdiction in which to hear a dispute. This is bearing out commercially as British lawyers report roughly £3.5 billion in annual income from abroad.

Yet, litigants looking to the English Commercial Court may also notice that London is a vibrant international media hub that closely scrutinises court cases. This can shape the discourse around a dispute and impact the reputation of the parties involved.

Managing communications around court cases has therefore become an important factor in the wider case management both in supporting legal outcomes and balancing reputational impact.

As the Commercial Court continues to attract major international disputes, only time will tell whether the trends identified by Portland’s research endure. What appears clear, however, is that with increasing numbers of foreign parties involved and a UK media hungry for sensational legal stories, communications will continue to play an important role, regardless of whether oligarchs are prominent or not.

Portland’s Disputes Unit helps organisations and individuals manage the reputational impact of a legal dispute and prevent damage through inaccurate reporting — engaging the media, policy makers, regulators and other stakeholders to ensure an accurate and balanced public record.

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