Hague Convention on Choice of Court Agreements: is it a game changer?

Since the beginning of 2025, the Hague Convention of 30 June 2005 on Choice of Court Agreements has been in force in Switzerland. The Hague Convention establishes uniform rules governing the international jurisdiction of courts in civil and commercial matters where exclusive choice of court agreements (also referred to as exclusive jurisdiction clauses) are in place. It also facilitates the recognition and enforcement of judgments rendered pursuant to such agreements.

Although jurisdiction clauses are a common feature of international commercial contracts, the practical impact of the Hague Convention is uncertain. In this Law-Now article we provide an overview of its key aspects and explore its potential implications, particularly concerning the UK and the drafting of dispute resolution clauses.

I. KEY ASPECTS OF THE HAGUE CONVENTION

A. Aim of the Hague Convention

The Hague Convention of 30 June 2005 on Choice of Court Agreements aims to promote international trade and investment by creating uniform rules for exclusive jurisdiction clauses. These rules are designed to enhance legal certainty and efficiency, thereby reducing costs for businesses operating across borders (see preamble to the Hague Convention).

B. Scope of Application

From a Swiss perspective, the Hague Convention's most relevant contracting states include the European Union, the United Kingdom of Great Britain and Northern Ireland and Singapore. While China (2017) and the United States of America (2009) have signed the Hague Convention, their ratification timelines remain unclear.

The Hague Convention applies to exclusive jurisdiction clauses (i.e. jurisdiction clauses limiting disputes to the courts of one jurisdiction) in civil and commercial matters but explicitly excludes areas such as wills and succession, insolvency and anti-trust (competition) matters. Contracting states may declare exclusions, but Switzerland has refrained from doing so (art. 1 and 2).

Furthermore, contracting states may reciprocally declare that they will also recognise and enforce judgments based on non-exclusive jurisdiction clauses (art. 22). As of March 2025, Switzerland is the only state to have made such a declaration, meaning there is currently no use-case for enforcing judgments based on non-exclusive jurisdiction clauses under the Hague Convention.

For a jurisdiction clause to be valid under the Hague Convention, it must be concluded in writing or documented in a way that allows access to the relevant information. The jurisdiction clause is treated as a standalone agreement, meaning its validity is assessed independently of the validity of other contractual provisions (art. 3).

Additionally, the Hague Convention applies only to jurisdiction clauses concluded after its entry into force in the state of the chosen court (art. 16). It does not cover proceedings initiated before that date. Therefore, only jurisdiction clauses designating Swiss courts and concluded from 2025 onward fall within the Hague Convention’s scope.

C. Relationship with other legal frameworks

Given that several contracting states are also members of the Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters ("Lugano Convention", of which Switzerland is a member), questions arise regarding which legal instrument takes precedence. The Hague Convention stipulates that other international agreements prevail, regardless of their date of entry into force (art. 26). Thus, where applicable, the Lugano Convention, which applies between the member states of the EU and the EFTA, overrides the Hague Convention. Similarly, the Brussels I Regulation takes precedence over the Hague Convention when the parties are based in the EU.
In Switzerland, the Hague Convention as an international treaty supersedes, where applicable, conflicting provisions of the Swiss Private International Law Act.

II. MAIN PRACTICAL IMPLICATIONS

A. Addressing the post-Brexit gap

Following Brexit, the Brussels I regime no longer applies to UK litigation and the EU has declined the UK's request to rejoin the Lugano Convention. The Hague Convention provides a partial solution for the recognition and enforcement of UK court judgments. Previously, no international treaty governed the recognition and enforcement of judgments between Switzerland and the UK. However, expectations should be tempered, as non-exclusive jurisdiction clauses – relatively common in financial contracts – fall outside the Hague Convention unless both the state of origin and the state of enforcement have made a specific declaration. As mentioned before, Switzerland has made such a declaration. However, the UK is unlikely to make such a declaration soon, given the upcoming entry into force of the Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters, which also addresses non-exclusive jurisdiction clauses.

B. Alternative to arbitration clauses

The Hague Convention opens new possibilities for parties to cross-border commercial contracts. Until now, parties had relied primarily on arbitration clauses to ensure the enforceability of decisions. The Hague Convention now provides a viable alternative in terms of enforceability of court judgments across jurisdictions. Whether parties to a contract should opt for an arbitration clause or a jurisdiction clause depends, of course, on many different factors as both options carry distinct advantages and disadvantages. Below are some differences between the two types of clauses, which should be considered when drafting a contract: 

• Arbitrability: When drafting a contract, it is essential to assess arbitrability – meaning whether a claim may legally be resolved by arbitration – under both the law of the seat of arbitration (lex arbitri) and in jurisdictions where enforcement is anticipated. This dual analysis can be complex. By contrast, an exclusive jurisdiction clause under the Hague Convention may provide greater legal certainty.
   
• Geographical location: In court litigation under frameworks such as the Hague Convention there is typically an inherent connection between the governing procedural law (lex fori) and the physical location of the proceedings. Arbitration, by contrast, offers greater flexibility. The parties may select an arbitration-friendly seat and thereby determine the governing procedural law (lex arbitri), which does not necessarily require the arbitration hearings to take place within that jurisdiction.
   
• Asymmetric clauses: Unlike the 2005 Hague Convention, which applies strictly to exclusive jurisdiction clauses, the 2019 Hague Convention on Recognition and Enforcement of Foreign Judgments broadens its scope to include judgments based on asymmetric jurisdiction clauses (i.e. it is exclusive for one party but non-exclusive for another). The 2019 Hague Convention explicitly excludes arbitration. Arbitration clauses and arbitration awards remain governed entirely by the 1958 New York Convention and local arbitration laws. Consequently, arbitration clauses – whether symmetric or asymmetric – fall outside the Hague Convention's enforcement framework, maintaining their separate enforcement system provided by the New York Convention.
   
• Tailored Proceedings: While the Hague Convention has improved cross-border enforceability of court judgments, arbitration remains attractive due to its procedural flexibility, enabling parties to tailor the process, appoint arbitrators with relevant expertise, and manage sensitive or complex disputes according to their specific needs.
   

C. Closer ties with Singapore

Singapore is Switzerland's most important trading partner in Southeast Asia. There are a large number of bilateral agreements between Switzerland and Singapore. The Hague Convention, which both states have ratified, further strengthens the relations between these two financial hubs. 

III. CONCLUSION: NOT A GAME CHANGER, BUT MORE OPTIONS

Given its limitation to exclusive jurisdiction clauses and the still limited number of contracting states, the Hague Convention’s transformative impact is likely to be modest. It, however, fills a gap left by Brexit in the legal relationship between Switzerland and the UK and expands the options available to parties drafting dispute resolution clauses in cross-border commercial contracts. Furthermore, relations between Singapore and Switzerland are strengthened.

The choice between a jurisdiction clause and an arbitration clause depends on the specific circumstances of the transaction and the parties involved. The Hague Convention enhances legal certainty in certain aspects but remains limited in scope. Arbitration, nevertheless, offers greater flexibility and broader enforceability but can be more complex. Careful consideration of both options is essential when drafting dispute resolution clauses.

For more information, contact your usual CMS contacts or these experts at CMS Zurich: Dr. Daniel Zemp and Manuela Kälin.