London commercial courts judgments fall but proportion of foreign litigants grows
London commercial courts recorded 20% fewer judgments and 34% fewer litigants compared to the previous 12 months, according to Portland’s 2022 Commercial Courts Report.
The courts handed down 234 judgments, down from a record 292 last year. But the proportion of foreign litigants increased, as nearly half (456) came from overseas.
The decrease in activity, which may be attributed to a combination of Brexit, COVID-19 and increased competition from other international courts, still makes 2021/22 the second busiest year since Portland started monitoring 10 years ago.
The number of judgments handed down in 2021/22 was 18% up on 2019/20 and an eye-catching 42% more than recorded five years before.
Number of judgments handed out by London commercial courts
But courts’ activity in 2022/23 may be impacted more severely as a result of the fallout from Russia’s invasion of Ukraine in February.
Portland’s report highlighted that Russian litigants have dominated the London commercial courts over the last 10 years.
Between 2017 and 2022, the number of Russian litigants more than doubled from 20 to 41 and Russia has consistently been in second or third place in number of litigants.
The long-term effect on the courts of Russia’s war on Ukraine is yet to be seen.
The UK accounts for 46% of litigants, with the courts continuing to attract litigants from around the world, with 75 countries represented. This includes 14 new nationalities, such as Bermuda, Benin, Iraq, Czech Republic and the Congo.
Though their proportion on the total increased in 2021/22, the number of foreign litigants dropped from 616 last year to 456.
Litigants by nationality in the London commercial courts
The proportion of litigants from EU-27 countries has remained unchanged, representing 12% of litigants: 16 EU member states were represented compared to 15 last year.
However, Portland’s report notes the full impact of Brexit and the opening of new commercial courts in Europe may not be felt yet as cases before the court now reflect “choice of law” and “choice of venue” clauses in contracts that may have been negotiated several years ago.
To accompany the report, Portland conducted public opinion polling regarding law firms providing legal services to Russian clients since the start of the conflict in Ukraine.
55% of respondents had a less favourable opinion towards law firms who provide legal services to Russian individuals and companies; 49% had a negative opinion towards English courts being used by Russian litigants.
As firms responded to the Russian invasion of Ukraine by closing offices in Russia, the poll found that 69% of respondents had a more favourable view of law firms that had taken this step.