Britain top choice for international lawsuits: Windfall for barristers from oil-rich Kazakhstan
Foreign firms and tycoons increasingly decide to settle court cases in the UK
Cahal Milmo is the chief reporter of The Independent and has been with the paper since 2000. He was born in London and previously worked at the Press Association news agency. He has reported on assignment at home and abroad, including Rwanda, Sudan and Burkina Faso, the phone hacking scandal and the London Olympics. In his spare time he is a keen runner and cyclist, and keeps an allotment.
Wednesday 08 May 2013
Kazakhstan has emerged as an unlikely source of a flood of lawsuits rapidly turning Britain into the world's preferred location for legal dogfights involving tycoons and international companies.
The oil-rich Asian country has provided a windfall for London's highly paid commercial barristers as part of a trend that has seen more than 1,600 foreign litigants (62 per cent of the total) beat a path to the High Court in the last five years – nearly twice the number of UK-based individuals and companies.
A study of 705 judgments delivered by the Commercial Court, the division of the High Court that deals with disputes over contracts and related matters, showed Kazakhstan was tied with Switzerland in being second only to the United States in providing work for British lawyers and courts. The research confirms London's growing attraction as a forum for expensive litigation, which last year saw British lawyers earn £3.5bn from abroad.
It is a phenomenon that Justice Secretary Chris Grayling has been keen to encourage, appealing earlier this year for more foreign litigants to bring their woes to the UK's courts. The Government has signalled that taxpayers may yet benefit from the popularity of the courts. Legislation due to be unveiled this week could pave the way for a shift in fee structures, meaning that high-value commercial cases pay an increased share of the costs to the public purse.
From Saudi companies to Greek shipping magnates, a steady stream of complainants has made its way to £300m Rolls Building in central London with its 31 hi-tech courtrooms – despite the fact that many disputes have no direct link with Britain, and in the face of increased competition to provide legal services from Hong Kong and Singapore.
The £3bn dispute between the Russian billionaires Roman Abramovich and the late Boris Berezovsky is thought to have cost tens of millions of pounds in lawyers' fees, including an estimated £3m for the Chelsea owner's silk, Jonathan Sumption QC, who is now a Supreme Court judge.
Russian litigants also featured significantly in the number of cases, accounting for 75 claimants and defendants between 2008 and 2013. But it is Kazakhstan, a former Soviet state with a population of 16 million, which is the most surprising source of fee-generating lawsuits. Many of the 86 Kazakh litigants relate to an ongoing dispute between one of the country's biggest banks, BTA, and its former chairman, Mukhtar Ablyazov, who is alleged to have defrauded it of $6bn (£3.9bn). The case has resulted in 11 separate lawsuits, involving at least 50 lawyers. Mr Ablyazov, who denies wrongdoing, was ordered in March to surrender assets worth $2bn. Experts said there were early signs that the high profile and the huge cost of the Abramovich-Berezovsky litigation may now be resulting in more such cases being settled before a trial.
Idil Oyman, head of legal disputes for Portland Communications, which commissioned the research, said: “This study confirms London’s status as an international legal centre. While Russian and Kazakh parties together constitute six per cent of all litigants, their share has decreased since 2011, so there is a question as to whether we’ll see a sustained drop from the region.”
General Election 2015: Fishing is on Nigel Farage's mind as he casts a line to the disaffected of Grimsby
The man who filmed the Freddie Gray video has been arrested at gunpoint
Indonesia executions: Death row British grandmother Lindsay Sandiford will refuse to wear a blindfold when she faces firing squad
Oxygen-starved 'dead zones' with no marine life up to 100-miles long discovered in the Atlantic Ocean
Russian warships accused of 'chasing away' Swedish vessel to prevent Baltic States from achieving energy independence
Over 50,000 families shipped out of London boroughs in the past three years due to welfare cuts and soaring rents
EU asylum policy is 'a direct threat to our civilisation', says Nigel Farage
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: SNP and its activists 'openly racist' towards the English, Farage says
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 4 How the language you speak changes your view of the world