Bahrain Brings the Hague Convention on Choice of Court Agreements into Force
On 1 July 2025, Bahrain brought the Hague Convention on Choice of Court Agreements 2005 into force, marking an important step in the development of cross border dispute resolution Bahrain. The move further strengthens Bahrain’s position as a jurisdiction aligned with international standards for commercial litigation.
Bahrain is the first country in the Middle East to ratify the Convention and, notably, the first jurisdiction outside the Hague Conference on Private International Law to do so. This development is expected to be welcomed by international investors, lenders, and commercial parties who place significant weight on certainty and enforceability when negotiating dispute resolution provisions.
Key Features of the Convention
The Convention gives legal effect to exclusive jurisdiction clauses in civil and commercial contracts. Where parties have agreed that disputes are to be resolved exclusively by the courts of a particular contracting state, the Convention seeks to ensure that this choice is respected and that judgments can be enforced across borders.
In practical terms, the Convention operates in two main ways. First, courts in contracting states are required to respect exclusive jurisdiction clauses and should generally decline to hear proceedings brought in breach of such agreements. Second, judgments issued by the chosen court must be recognised and enforced in other contracting states without a review of the merits, subject only to limited exceptions.
This framework provides greater predictability for parties both at the jurisdiction stage and at the enforcement stage of a dispute.
Scope and Limitations
The Convention applies only to exclusive jurisdiction clauses in civil and commercial matters. It does not apply to non-exclusive or asymmetric jurisdiction clauses, which are commonly used in finance and capital markets transactions.
There are also important subject matter exclusions, including insolvency, competition law, certain intellectual property matters, and specific rights in rem relating to immovable property. Parties should therefore continue to assess carefully whether their contracts fall within the Convention’s scope.
Where the Convention applies, the court designated in the exclusive jurisdiction clause must hear the dispute, while other contracting state courts must generally stay or dismiss competing proceedings. Judgments from the designated court must then be recognised and enforced by courts in other contracting states, subject to limited defences such as fraud or manifest incompatibility with public policy.
Regional Significance
Bahrain’s ratification reflects a broader regional trend towards strengthening cross border dispute resolution frameworks. Arbitration has long been supported across the Middle East through widespread adoption of the New York Convention. In the litigation context, courts in the region have increasingly recognised and enforced foreign judgments based on reciprocity or bilateral arrangements.
The Hague Convention offers a multilateral, rules-based alternative for parties who prefer court litigation. It is often described as the litigation counterpart to the New York Convention, providing similar certainty for exclusive jurisdiction clauses as the New York Convention provides for arbitration agreements.
For Bahrain, this development enhances its profile as a jurisdiction that supports international commerce and the effective enforcement of court judgments.
Practical Implications for Contracting Parties
With the Convention now in force, parties may wish to revisit their approach to jurisdiction clauses. In particular, exclusive jurisdiction clauses may become more attractive to parties seeking the certainty of predictable enforcement across contracting states.
That said, the choice between arbitration, exclusive court jurisdiction, and more flexible jurisdiction arrangements will remain transaction specific and driven by considerations such as enforcement strategy, confidentiality, speed, and market practice.
Looking Ahead
Bahrain’s adoption of the Hague Convention on Choice of Court Agreements 2005 is a meaningful step in the evolution of dispute resolution in Bahrain and the wider region. For international businesses and investors, it offers increased certainty, reduced enforcement risk, and further confidence in Bahrain as a sophisticated and reliable legal forum.
As awareness of the Convention grows, it will be interesting to see how market practice develops and whether exclusive jurisdiction clauses gain greater traction in contracts connected to Bahrain.
