The recovery of international commercial debts, nor the resolution of international (commercial) disputes has ever been easy, but with the Brexit approaching (probably rendering the access to British courts more difficult) and the insecurity of its implementation, the need for an international commercial court is imminent.
The Belgian legislator has sensed this need, and recently approved a draft bill for the creation of an International Business Court in Brussels (BIBC). This initiative aims to handle potential disputes linked to the Brexit, as well as international (commercial) disputes (B2B).
The BIBC could best be described as a hybrid court, wherein the advantages of arbitration are combined with features of traditional civil courts.
The BIBC would have the following particularities:
- The parties shall be able to decide voluntarily to bring proceedings before the BIBC. Parties shall also be able to determine the relevant governing law;
- The working language before the BIBC shall be English: the proceedings itself shall be held in English, exhibits can be produced in English and the awards shall also be rendered in English;
- The BIBC will be presided by both professional judges and selected legal experts, from domestic and foreign jurisdictions. By combining such expertise, proceedings should be fast and professional;
- Due to the high level of expertise, it will not be possible to lodge an appeal against the decisions of the BIBC. This should accelerate the proceedings in general;
- The Belgian government aims to create a largely self-financing international court (in light of the financial need of the Belgian civil courts). Hence, we expect substantial enrolment fees to be demanded from both parties before initiating proceedings.
As a reaction to the potential creation of the BIBC, several magistrates of the Brussels Court of Appeal have published an open letter, wherein they criticize the creation of the BIBC, and its potential impact on the resources of the traditional Belgian courts. The current draft bill foresees two judges and clerks of the Brussels Court of Appeal to be deployed at the BIBC. Given the current (and urgent) need for more resources within the various courts in Belgium, the magistrates perceive the potential creation of the BIBC as premature and ill-conceived.
At Cresco, we believe the BIBC has the potential to become a useful and efficient forum for international litigation in Belgium.
The English language has long time been established as the dominant international (corporate and) business language, especially in the field of corporate venturing. As such, foreign investors often require the relevant contractual framework in Belgium to be drafted in English. For the same reasons, Belgian start-ups, growth funds and investment companies often (immediately) adopt the English language for their legal framework and opt to use English as their working language.
However, when it comes to dispute resolution regarding these said legal and contractual frameworks, parties often resort to (expensive) arbitration proceedings, since Belgian state court litigation proceedings cannot be conducted in English.
As such, and to the extent that the costs to initiate and conduct proceedings in front of the BIBC can be kept under control, we are convinced that the creation of the BIBC could constitute a valuable, and effective alternative dispute resolution forum alongside customary arbitration proceedings.
The bill hasn’t been adopted yet. We will closely monitor this subject matter and keep you informed on its implementation.