# אוקראינע לעגאלע אקציע 'ריזיקירט UK לעגאלער סטאטוס'

The UK’s position as world’s foremost legal centre has been put under threat by Brexit, it has been claimed, שרייבט מארטין באַנקס.   

The legal sector is estimated to be worth approximately £26 billion to the economy annually. But like other sectoral leadership roles held by the UK, uncertainty surrounding Brexit places this status under potential challenge as other jurisdictions seek to position themselves as preferable to London for dispute resolution.

Back in December 2017, the then Justice Minister Dominic Raab presented Brexit as an "enormous opportunity" for the legal sector, adding that Britain had a reputation as a “global centre for business as being the best place to resolve disputes”.

The CityUK, which lobbies for financial and professional services firms, has however warned that Brexit poses a threat to the Britain’s ability to act as an arbiter on international cross-border trade and investment disputes.

The group has said it is critical to make sure “international parties understand the ongoing   benefits” of using English law and legal services once the UK has left the EU, with the “efficient and cost-effective resolution of disputes being critical to that goal and the international attractiveness of the UK."

Other cities are now explicitly seek to offer English law in their own jurisdictions, with Paris opening a new International Tribunal practising English law, followed by courts in the Netherlands, Germany and Belgium. Further afield, former lord chief justice Lord Woolf is now joined by eight other British judges running a commercial court in English law in Kazakhstan.

Commenting on the post-Brexit status of British courts, Jock Mendoza Wilson, who is Director of International and Investor Relations at Ukraine’s System Capital Management stated that London is “arguably” the world’s foremost legal centre for international arbitrations and disputes. He added: “There is no innate reason for this to be the case: it stems from the fact that English law is very widely respected internationally.

אַדווערטייזמאַנט

“Law is an important export and source of revenue and business activity for the City of London and the UK.”

Currently, he is pessimistic about the outlook, post Brexit, for UK courts, adding: “Now is, therefore, the very worst time for London to attract negative views with regard to tribunal conclusions.”

This was a direct reference to a high profile case involving his company, System Capital Management, and a ruling by the internationally respected London Court of International Arbitration.

SCM is embroiled in a long-running legal dispute with a rival over the country’s biggest fixed-line telecoms group, Ukrtelecom which the company acquired from Raga in June 2013 on the basis the company was fully in compliance with Ukrainian law.

Raga had previously purchased Ukrtelecom, a former public company, from State Property Fund of Ukraine (SPFU) in 2011 in a process now judged to be badly flawed.  Raga, it is claimed, had reneged upon a pledge to the SPFU to invest $450 million into Ukrtelecom and construct a special communications network for law-enforcement officials – a fact that was not disclosed to SCM, who have sought to back away from their acquisition of the company.

In a ruling last June, Raga won an award at the London Court of International Arbitration against SCM Financial Overseas. Raga, part-owned by former Ukrainian banker Denis Gorbunenko, has been pursuing SCM and others seeking full payment for the sale of Ukrtelecom. SCM totally disagrees with the order, calling it “completely groundless” and is contesting it.

In its ruling the arbitral tribunal ordered SCM Financial Overseas Limited (SCM FO) – a Cyprus-based offshoot of SCM, an industrial conglomerate – to immediately pay the alleged $760.6 million debt to Raga Establishment Limited.

It was alleged that SCM FO had failed to pay the majority of the instalments owed for the purchase of Ukrtelecom in 2013, claims strenuously denied by SCM.      Speaking of the impact of the SCM-Raga dispute, Mendoza-Wilson told אי.יו. רעפּאָרטער: “For a tribunal to hold that a party must pay another for an asset that the tribunal knows has been seized from them as a consequence of a flawed privatisation process would bring justice in London into disrepute.

“Ignoring the situation in Ukraine, including the decision reached by the Ukrainian courts, which had a defining impact on the case under consideration, could reflect very poorly on English courts. It suggests that this is not a jurisdiction willing or able to recognise or consider events in foreign markets in an international case.”      He added:  “Ultimately, certainty and confidence in English law could be undermined.

"Other leading international businesses, seeing this decision, would be less likely to contract to arbitrate here and London and the UK’s position as leader for commercial litigation and dispute resolution could be gravely undermined.

“It’s clearly wrong that English courts may make a company suffer and incur huge financial losses on the basis of another company having behaved inappropriately during a state privatization process.”

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