On March 3, 2021, Israel signed the HCCH Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (“2019 Convention”). Israel became the third State to sign the Convention, joining Uruguay and Ukraine.
The Hague Conference on Private International Law adopted the Convention to provide a uniform process to HCCH member states for enforcing civil judgments in other countries throughout the world. The convention provides that contracting states will recognize and enforce certain civil or commercial judgments rendered by courts of other contracting states, obviating the need for a review of the underlying judgment on its merits.
The principal tenet of the convention is Article 4, which provides that “a judgment given by a court of a contracting state (state of origin) shall be recognized and enforced in another contracting state (requested state) in accordance with [chapter 2 of the convention].”
Although three States have now signed the 2019 Convention, the Convention has yet to be ratified, which is an important milestone for the Convention to come into full force and effect.
Article 28 of the 2019 Convention specifically provides that:
“This Convention shall enter into force on the first day of the month following the expiration of the period during which a notification may be made in accordance with Article 29(2) with respect to the second State that has deposited its instrument of ratification, acceptance, approval or accession referred to in Article 24.
At least two States need to deposit their instruments of ratification, acceptance, approval or accession. However, the fact that Israel signed the Convention is a good sign for the 2019 Convention’s viability and is a signal that the States are supportive of the global framework for the foreign judgment recognition and enforcement.
Although United States has yet to sign the 2019 Convention, several states, including New York, provide broader mechanisms and protections for the enforcement of foreign judgments than the Convention. New York adopted the Foreign-Money Judgments Recognitions Act, or Article 53, of the New York Civil Practice Law and Rules. As we have previously discussed, New York’s Article 53 is relatively broad, allowing for recognition and enforcement of “any foreign country judgment which is final, conclusive and enforceable where rendered.” The grounds for non-recognition are more limited than the grounds provided in the 2019 Convention.
Further, under Article 53, there is no explicit limitation on what categories of foreign money damages a judgment creditor can have recognized and enforced. In contrast, the 2019 Convention has a potential significant limitation. Under Article 10 of the 2019 Convention, “recognition or enforcement of a judgment may be refused if, and to the extent that, the judgment awards damages, including exemplary or punitive damages, that do not compensate a party for actual loss or harm suffered.”
The 2019 Convention, however, provides a useful framework for recognition and enforcement of foreign judgments, particularly in those countries and States that, contrary to New York, do not have robust proceedings. Israel’s signature is an important step forward towards legitimizing the Convention’s framework at the global level.