Potential divorce reforms could impact London’s reputation as divorce capital
updated on 05 September 2023
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Earlier this year, a review was commissioned to revaluate 50-year-old legislation regarding how financial assets are split, with calls for less generous financial awards expected to be requested for financially weaker spouses. According to The Times, the potential reforms could put an end to London’s status as the ‘divorce capital of the world’.
Preliminary work began in April 2023 to review how finances are distributed post-divorce, with the Law Commission set to publish a ‘scoping paper’ in September 2024. As part of the reforms, the current law is being reviewed to assess whether it still works in the fairest way and, according to Justice Minister Lord Bellamy “builds on our landmark no-fault divorce reforms which ended the blame game, helping protect families and children from the stress of separation”.
Over the years, London has established itself as a popular jurisdiction for the wives of wealthy foreign business owners because the current law allows for considerable judicial discretion in financial awards, particularly when looking at spousal maintenance. If restrictions on judicial discretion are introduced, Baroness Deech has predicted that there will be an “onslaught of protest from barristers and solicitors as there have been years of objections to reform”.
Mark Harper, a partner at Hughes Fowler Carruthers, comments that UK legislation provides divorced women with more income than European jurisdictions. In Europe, a system of “marriage contracts” is used, meaning that wives typically “receive no share of their assets and therefore no capital” with spousal maintenance “usually assessed at a much lower level”. Harper points out that “many English judges and practitioners believe it would be unfair to allow such a system” in the UK.
Meanwhile, it's been predicted by some that the new reforms could negatively affect London’s position as a prominent location for divorces to take place. However, some believe that the changes could boost London’s legal position as wealthy foreigners seeking to enforce harsh prenuptial terms on less wealthy spouses may be attracted to the City post-reform.
