Are you going through a divorce in a foreign country but you or your spouse has an English pension? This area has potential trips and pitfalls so it is important you think about it early, and take early advice – read on!

You might now be living in another jurisdiction, but have spent considerable time in England, during which period you built up an English pension. Your English pension might even be the only asset that you still have in England, and all the rest of the assets relevant to your divorce are located in the other country where you are divorcing. This might mean that you forget about the English pension, when it’s important not to do so!

An English pension cannot be shared without an English court pension sharing order, or “PSO”. A foreign court order that says that all pensions should be shared will not be applicable to or enforceable against an English pension. If your divorce is completed abroad and you have a foreign court order dealing with the finances associated with your divorce, it is therefore required that you also get an English PSO. The only way to do this is to make an application to the English courts under Part III of the Matrimonial and Family Proceedings Act 1984, commonly known as a “Part III claim”. This law enables the English court to review a foreign financial order associated with divorce, and possibly provide further financial provision to the applicant above and beyond the foreign order.

The criteria to qualify for a Part III claim is that your divorce in the other country was legally valid; you have not remarried since that divorce; and that you have a “sufficient connection” with England. You will have a “sufficient connection” if either you or your spouse are domiciled in England and Wales (and were/was at the time of the foreign divorce), or if either of you have been habitually resident in England and Wales for a year before making the Part III claim.

Prior to Brexit, there was an additional limb of the “sufficient connection” test that was called the “forum Necessitatis’” limb. Essentially this allowed for England to secure jurisdiction for a Part III claim if no court of any other EU country has jurisdiction on any other ground. This was very helpful for making a Part III claim for a PSO because you would only have to prove that you are not domiciled or habitually resident in any EU country (other than the country you divorced in, if relevant). This made applications under Part III for an English PSO by parties who are both resident and domiciled abroad possible.

This “forum Necessitatis’” jurisdiction option was removed by post Brexit legislation. This means that, if neither of you are domiciled or habitually resident in England or Wales, you will not be able to secure an English PSO, and the English pension will remain with the person whose name it is in. You do not want to have gone through your whole divorce settlement negotiation acting on the assumption that the English pension would be shared, only to discover that will not be possible. Therefore, if you are entering a divorce abroad but you know that you or your spouse have an English pension, take advice at the outset on whether or not you will be able to get an English PSO and ideally before you even issue the initial proceedings, if possible. If a lawyer confirms this will be difficult for you, you can consider “off-setting”, whereby you account for the fact that the English pension is out of scope of any financial order by granting a higher share of other assets to the non-pension holding spouse. It is best that this forms part of the settlement negotiation from the outset and will likely require specialist actuarial advice to determine the value of the pension to the party who is retaining it.