Today the Government published a White Paper for the Great Repeal Bill, but confirmed it does not intend to publish the Bill in draft before it is placed before Parliament.

When it appears, the Bill is likely to be only a few pages long, but the changes made under it will dominate the current Parliament, transform the UK’s legal landscape and almost certainly result in numerous legal battles in our courts for years to come.

The White Paper says that the legislation will do three main things.

First, it will repeal the European Communities Act 1972 (“ECA”).

Second, most EU law as it stands at the moment of exit will be converted into UK law before we leave the EU. This is necessary so that the UK does not suffer from legal ‘black holes’ when we leave (e.g. an absence of laws regulating pharmaceuticals etc.) and in order to maintain legal certainty.

The Government is probably hoping that this approach will also help us to get a better trade deal from the EU, on the basis that Member States will be reassured that UK products and services will continue to comply with rules and regulations derived from EU law.

Third, the Great Repeal Bill will create powers to make secondary legislation to adjust EU laws which would no longer operate appropriately once we have left the EU (e.g. because they grant functions to EU institutions which we will need to replace with an equivalent UK body).

These reforms will raise many issues, some of profound constitutional significance, others of enormous complexity. Some will be explored in future posts on this Blog, while some already have been (such as in this post by Christopher Muttukumaru CB, and this one by George Peretz QC). These are some of the key points arising from the White Paper.

Which EU laws will be converted into UK law?

At the moment, EU law operates in the UK in a variety of ways. In certain areas, we have implemented EU law by passing pieces of primary legislation (such as the Equality Act 2010). These will obviously not need incorporating (but they may need amending).

In other cases, EU law is implemented through secondary legislation, including statutory instruments made under the ECA – which will need to be retained as they would otherwise fall away on exit.

Other types of EU law have direct effect in the UK, including more than 12,000 regulations and EU Treaty provisions. The White Paper clarifies that regulations will not be ‘copied out’ for domestic purposes, rather the Great Repeal Bill will provide that they will continue to apply as a matter of UK law “as they applied in the UK the moment before we left the EU” (subject to the discussion below concerning post-Brexit EU law judgments).

It was unclear how Treaty provisions would be treated before the White Paper. It states, however, that Treaty rights that can be relied on in court by individuals (e.g. such as those setting out worker and consumer rights) will be incorporated into UK law. That may prove quite significant over the longer term, not least because it will mean that UK litigants will still be able to rely on the more ‘teleological’ legal reasoning that is characteristic of EU law, alongside the ‘black letter’ approach traditionally favoured by the common law.

In his response to David Davis’ statement, Keir Starmer on behalf of Labour focused on the fact that the White Paper says that the EU Charter of Fundamental Freedoms will not be converted into UK law. One suspects that issue may have been selected in part for its usefulness for political campaigning, and not only because of its legal impact. As the Government notes, the Charter was designed to codify pre-existing EU law, much of which will be converted into UK law in any event. UK citizens will also be able to rely on the ECHR and the Human Rights Act, as well as the fundamental common law rights that our courts have been busy developing over the past few years.

It will be interesting to see if anyone can point to a Charter right that would not otherwise exist under UK law, although incorporating the Charter would obviously give those rights added protection against encroachment by future legislation.

Will all the legislative changes receive proper Parliamentary scrutiny?

That is the key question. A huge number of laws are going to need amending in a short period of time, in particular given that many of the required changes will only become clear once the Article 50 negotiations have progressed. The White Paper estimates that between 8,00 and 1,000 statutory instruments may be required for Brexit-related changes.

The Government correctly states that “there is a balance that will have to be struck between the importance of scrutiny and the speed of this process”. But the level of scrutiny that has been proposed is almost certainly not adequate and the Government will need to adjust its approach.

In a handful of areas, such as customs, immigration, agriculture and a few others, reforms will be properly scrutinised because they will be brought forward in primary legislation – because the UK will effectively need to set up entirely new domestic regulatory regimes.

It is in the areas where changes are to be made through secondary legislation that concerns arise. Mr Davis sought to reassure by saying that changes would generally be made through the standard procedures for statutory instruments, namely the negative procedure (which does not require debate) and the positive procedure (which requires debate and approval by both Houses).

But this is not reassuring because these procedures stack the deck in favour of the Executive, not least because it is generally not possible for Parliament to amend secondary legislation. While Parliament can sometimes intervene to require a ‘super affirmative’ procedure, this will not help much as it is almost as lengthy and detailed as that for primary legislation. As a result, it will not generally be viable given the time constraints.

It is for these reasons that it has been suggested that new, more flexible procedures should be introduced to give Parliament greater scope to review and amend Brexit-related statutory instruments where appropriate, without bringing the whole process to a standstill. Increased but timely scrutiny would also be facilitated if the Government agreed to publish its proposed legislation in draft, accompanied by White Papers summarising what changes were being made and why they were necessary.

These issues are likely to be picked-up in many of the responses to the White Paper as well as during the Bill’s passage through Parliament. They will be informed by the findings of the inquiry that has been launched by the Commons Procedure Committee into ‘Delegated powers in the Great Repeal Bill’.

Will there be legal constraints on what the Government can do?

Yes. The Government has said that the powers conferred on it by the Great Repeal Bill will be time-limited, although the White Paper does not specify a particular timeframe. The powers will probably need to extend beyond the date of Brexit, as even in the most hopeful scenario there will undoubtedly be legislative odds and ends that need sorting out. A cut-off of two or three years after Brexit has been suggested by others.

In addition, and importantly, the White Paper states that the Government “will ensure that the power will not be available where Government wishes to make a policy change which is not designed to deal with deficiencies in preserved EU-derived law arising out of our exit from the EU”. The powers conferred on the Government to amend the law through secondary legislation will therefore be expressly limited to Brexit-related issues.

Lawyers with clients itching to have their EU regulations amended for non-Brexit related reasons (e.g. because they regard them as unduly onerous), are therefore going to have to wait until after Brexit has taken place (except in those areas where broader reforms are brought forward in primary legislation where there may be more scope for lobbying). The Government will have plenty to do without also having to sift through a Pandora’s box of EU-related gripes.

In addition to the express wording of the Bill, the Government will also be subject to other, less obvious constraints. The effect of all of this is that many rules that were previously set out in effectively unchallengeable primary legislation (such as EU regulations and Acts of Parliaments) will in future be the product of statutory instruments – which there is much more scope to challenge.

The traditional approach of the UK courts is as has been stated by Lord Donaldson: “The duty of the courts being to give effect to the will of Parliament, it is, in my judgment, legitimate to take account of the fact that a delegation to the Executive of power to modify primary legislation must be an exceptional course and that, if there is any doubt about the scope of the power conferred upon the Executive or upon whether it has been exercised, it should be resolved by a restrictive approach”.

Various other principles of statutory interpretation will also be relevant, including the presumptions that secondary legislation should not infringe fundamental rights or change the law retroactively. Our courts are likely to be kept busy for many years with challenges to secondary legislation enacted under the Great Repeal Act.

What status will be given to EU judgments?

For all those areas of UK law which are derived from EU law, the White Paper proposes that UK courts will be required to treat EU case law that pre-dates Brexit as being equivalent to Supreme Court judgments (i.e. binding on all courts below the Supreme Court itself).

The position of post-Brexit EU judgments is less clear. The White Paper says that “the Bill will not require the domestic courts to consider the CJEU’s jurisprudence”. On the other hand, it also states that “for as long as EU-derived law remains on the UK statute book, it is essential that there is common understanding of what that law means”.

But what happens when the CJEU develops EU law after Brexit? If most UK courts are bound to follow the old, pre-Brexit EU law position, UK and EU law will diverge and there will no longer be a ‘common understanding’ – at least unless and until a UK case makes it to the Supreme Court. Our highest court is going to be very busy if it has to take responsibility for deciding cases every time there has been a development in EU law.

These difficulties can probably be minimised. If the Great Repeal Act is silent on post-Brexit EU judgments, UK courts will be free to treat them as being of persuasive authority (and probably will). They will then be free to follow post-Brexit EU law judgments, at least where there is no good reason for taking a different approach, so long as they can distinguish any earlier pre-Brexit EU authorities. It is only where those earlier judgments cannot be distinguished on the facts that the Supreme Court will be needed to develop EU-derived domestic law.

Nonetheless, this is not something that the White Paper grapples with at all and further thought will be required.

What happens next?

People will respond to the White Paper and the Government may adjust its position in various respects before it presents the Great Repeal Bill to Parliament, which will then spend several months debating it. Parliament will face a trade-off, though, as the longer it spends debating the Bill the less time it will have available to scrutinise the secondary legislation made under it.

In the meantime, Government departments will continue with trying to identify all the changes that need to be made to their areas of EU legislation in order to make them work properly at the time of Brexit. And now that Article 50 has been triggered, both civil servants and parliamentarians will be trying to hit something of a moving target as the negotiations develop.

There is, to put it mildly, a lot to be done.

 

In his speech last week, Michel Barnier, the European Commission’s Brexit negotiator, warned that the Withdrawal Agreement which is to be negotiated pursuant to Article 50 TEU will have to be subject to the law and judicial system of the EU. Of course, that agreement will be an act of the EU institutions and so cannot escape the jurisdiction of the Court of Justice of the EU. It follows that the CJEU will be able to rule on the legality and interpretation of all the provisions of the Withdrawal Agreement and any implementing measures which may be adopted.

Does that mean that all disputes arising out of Brexit will be subject to the jurisdiction of the CJEU?

Not necessarily. That is crucial because – sadly – following Brexit a host of disputes can be expected to arise in relation to the Withdrawal Agreement (if there is one) and to wider Brexit issues. It is scarcely conceivable that a Withdrawal Agreement could be concluded at all without an effective dispute settlement mechanism involving a court or arbitration. At the same time, the Government stated in its White Paper that ending the CJEU’s jurisdiction over the UK was to be an essential element of Brexit, while acknowledging that it must continue to abide by international law.

Amongst the ideas floated in the White Paper is that the Withdrawal Agreement might only provide for a Joint Committee of the Parties for the settlement of disputes – a purely political mechanism under which, if attempts to reach a diplomatic solution fail, a Party can only adopt political sanctions or denounce the agreement.

Precedents for this “model” include many of the bilateral agreements between the EU and Switzerland (of which there are said to be about 130!). But, while the Withdrawal Agreement can be expected to establish a Joint Committee, the EU is unlikely to be satisfied with that alone, given the depth and complexity of the relationship between the UK and the EU. Indeed, negotiations are currently under way between the EU and Switzerland in which the EU is seeking to persuade Switzerland to accept a judicial dispute settlement mechanism.

In the White Paper, the Government referred to a number of arbitration mechanisms enshrined in existing trade agreements (e.g. that between New Zealand and South Korea) as well as CETA, the agreement between the EU and Canada which has been signed but not yet ratified. Disputes between the Contracting Parties and (in the case of CETA) investors are decided by arbitration. No suggestion can be found in the White Paper that it might be appropriate to submit post-Brexit disputes to any type of court.

The potential disputes fall into two categories: those between the UK and the EU and/ or its Member States (let us call them “interstate disputes” even though one of the parties is likely to be an international organisation); and disputes to which individuals and companies are party.

As to interstate disputes, the CJEU does not have jurisdiction under the EU Treaties over disputes involving a State outside the EU (a “third country”), unless the latter agrees to that jurisdiction beforehand. The only exception is that, where the EU institutions adopt an act with adverse consequences for a third country (e.g. a decision by the Commission to set off a sum due to the UK against an amount due from the UK after Brexit day), the latter would be able to challenge it before the CJEU. What is more, it is usual for State disputes to be decided by international courts or tribunals. So the UK might have a good case for resisting attempts by the EU to grant the CJEU jurisdiction over such disputes.

Having said that, Article 20 of the Agreement between the EU and Switzerland provides: “All questions concerning the validity of decisions of the institutions of the Community taken on the basis of their competences under this Agreement, shall be of the exclusive competence of the Court of Justice of the European Communities.” (see here and here)

Nevertheless, a more conventional forum would be a body such as the Permanent Court of Arbitration. Furthermore, disputes relating to the World Trade Organization (WTO) would be decided by arbitration in accordance with that treaty, while the International Tribunal for the Law of the Sea (ITLOS) has jurisdiction over those concerning the United Nations Convention on the Law of the Sea (UNCLOS); the UK is already party to both treaties.

In contrast, the UK might face more of an uphill struggle trying to prevent disputes involving private parties (companies or individuals) from being heard by domestic courts.

Admittedly, Article 30.6.1 of CETA specifically provides that its provisions may not be “directly invoked in the domestic legal systems of the parties”. Article 17.15 of the EU-Singapore Agreement is to the same effect. However, having been a member of the EU for over 40 years and sharing a land border with a Member State, the UK’s links with the EU run far deeper and are far broader than those of distant countries such as Canada and Singapore. Accordingly, it is questionable whether such a provision would be appropriate in the Withdrawal Agreement, as least as regards non-commercial issues.

In 2014, the draft agreement for the accession of the EU to the European Convention on Human Rights was rejected by the CJEU because some EU law issues would have been decided outside the normal mechanisms, thereby circumventing the Court’s role in interpreting and applying EU law. How broad this rule is remains a matter for speculation.

Debate is still ongoing as to whether the dispute settlement mechanisms in CETA are in line with EU law, as the establishment of arbitral tribunals of a radically new type laying the basis for a Multilateral Investment Court (see here) to hear disputes involving investors would bypass the Court in Luxembourg.

Belgium is set to request an opinion from the Court of Justice on the legality of these mechanisms, which should be delivered shortly before the UK leaves the EU in March 2019.

Unless the Court gives its blessing to the CETA mechanisms, the EU presumably will insist on British companies bringing their disputes involving EU law before the courts of the Member States or the Court of Justice, as the case may be. To ensure reciprocity, the EU will presumably want all or part of the Withdrawal Agreement to be introduced into UK law, to ensure that EU nationals and companies can litigate in the UK courts.

Even if the CJEU were to give its blessing to CETA, it should be recalled that, if there is to be any Withdrawal Agreement at all, it will cover the acquired rights of EU nationals resident in the UK and those of British expats living in the EU. It is hard to imagine any appropriate forum for determining disputes over these matters other than the domestic courts of the UK and the Member States of the EU, as the case may be: the proverbial Polish plumber could hardly be expected to go to international arbitration, and exactly the same applies to the British pensioner on the Costa del Sol.

Any mechanism requiring the UK courts applying provisions of the Withdrawal Agreement would probably encounter strong opposition from hardline Brexiters. No doubt, they would see it as introducing the case law of the CJEU into UK law by the back door.

On the other hand, this morning’s Financial Times suggests that the Government may take a more moderate line, speaking of “signs that Mrs May’s promise ‘to end the jurisdiction of the European Court of Justice in Britain’ is being recalibrated to provide room for manoeuvre in one of the most contentious areas of the negotiation”; and it quotes the Brexit department as saying that this means “bringing to an end the direct jurisdiction” of the Court in the UK (with the emphasis being on the word “direct”).

At any rate, given the massive uncertainties surrounding the forthcoming negotiations, other scenarios cannot be excluded. But the EU is likely to reveal its hand sooner than might have been expected, if Mr Barnier’s new bid to ensure the maximum possible transparency of the EU’s negotiating position gains the day.

Acknowledgements Many thanks to my colleagues Professor Panos Koutrakos and Conor McCarthy for their helpful comments on an earlier draft of this post. Responsibility for this post is mine alone, however.

 

On 13 March 2017, Anneli Howard participated in the UK Legal Future event at the House of Commons. Her Panel discussed the need for transitional arrangements for the period between the UK’s withdrawal from the EU and the eventual conclusion of the trade negotiations and thereafter. She focussed on the potential disruptions to cross border and pan European business outside the single market as well as the pragmatic solutions that companies should be considering as part of their Brexit preparations to ensure business continuity. A copy of her presentation is here.

On Valentine’s Day, the House of Lords Select Committee on the EU published a report entitled “Brexit: Environment and Climate Change” .But there is nothing romantic about this document: while recognising that Brexit affords the UK the opportunity to improve on EU environmental legislation in certain respects, it paints a bleak picture of what environmental law in this country could become post-Brexit, all the more because this event will affect “nearly every aspect of the UK’s environmental policy”.

The report stresses the risk that binding environmental standards will be lowered for financial reasons, not least to attract foreign investment – although it points out that this risk may be especially high in England since, according to several witnesses, “in some respects the Devolved Administrations’ environment and climate change ambitions” are higher.  But it is clear from the report that this decline might occur quite slowly.  In the colourful language of one witness, it will not necessarily be “a race to the bottom” but could be “a stroll to the bottom” with standards being regularly pared down in small ways.

Having said that, the report underlines the fact that, if the UK is to continue to sell its products in the EU, it will have to meet the EU’s environmental standards.  In addition, the report indicates that the UK would be subject to firm diplomatic pressure if it were to lower its standards regarding air pollution, since the prevailing winds would sweep most of the pollution over to the Continent.

On the issue of the enforcement, the report is particularly forthright, stating:

The importance of the role of the EU institutions in ensuring effective enforcement of environmental protection and standards, underpinned as it is by the power to take infraction proceedings against the United Kingdom or against any other Member State, cannot be over-stated. The Government’s assurances that future Governments will, in effect, be able to regulate themselves, along with Ministers’ apparent confusion between political accountability to Parliament and judicial oversight, are worryingly complacent.

As if to emphasise this point, the very next day the Commission announced that it was issuing a reasoned opinion to the UK – along with four other Member States – for failing to address repeated breaches of air pollution limits for nitrogen dioxide (here).

To remedy this deficiency, the report calls for “an effective and independent domestic enforcement mechanism” with regular oversight of “Government’s progress towards its environmental objectives, and the ability, through the courts, to sanction non-compliance as necessary”. No doubt, the reference to “Government” here includes the Devolved Administrations, since environmental policy is primarily within their remit.

In short, in this report the Select Committee appears to cast some doubt on the Government’s statement in its recent White Paper on Brexit (here) that it is “committed to ensuring we become the first generation to leave the environment in a better state than we found it”.

What is more, the report warns of the dangers of legal uncertainty, quoting Professor Macrory as saying “on exit, whatever form it takes, we need a period of regulatory stability … The last thing you want is to find there are gaps, lots of litigation and so on; that will not help business or anyone else.”

As the report points out, the Great Repeal Bill could be a source of considerable legal uncertainty, given the numerous complexities of attempting to carry over the existing body of EU law into a post-Brexit UK – a point already made in relation to all the areas concerned by George Peretz QC back in October (here).  (Indeed, back in October 2016, DEFRA Secretary Andrea Leadsom had already acknowledged that around a third of environmental acts “won’t be easy to transpose” (here).

Again, the reference to the Great Repeal Bill must be taken to refer equally to the primary and secondary legislation enacted by the Devolved Administrations designed to achieve the same objective.  (In the White Paper, the Government reiterated its commitment to the effect that it would not attempt to recover devolved powers. That is in accordance with the Sewel Convention.)

The final chapter of the report is devoted to devolution.  In the absence of the “overarching framework of EU legislation”, considerable divergences between environmental law and policy in the four constituent parts of the UK can be expected, according to several witnesses to the Select Committee.  To some extent, because Scotland, Wales and Northern Ireland are widely expected to be more ambitious than the UK Government in this regard, this could be positive.  However, the report stresses the need for coordination to avert unnecessary divergences and even “friction”.

 

Gerry Facenna QC and former Head of Monckton Chambers Sir Jeremy Lever KCMG QC are two of the five authors of a legal opinion published today by “the People’s Challenge”, a group who took part as an interested party in the recent Supreme Court case initiated by Gina Miller. The Opinion, whose authors also include former CJEU Judge Sir David Edward KCMG PC QC and former CJEU Advocate General Sir Francis Jacobs KCMG PC QC, considers the United Kingdom’s constitutional requirements for withdrawing from the EU and the contentious issue of whether, under EU law, a notification given by a Member State of its intention to leave the EU may subsequently be revoked.

Please click here for the full news release, and here to read the Opinion.

 

Thomas Sebastian spoke yesterday at an event organised by UK Legal Future at the House of Commons.

His remarks dealt with the so-called “WTO Option”. Thomas addressed two questions of process: (1) Whether the UK will be able to rely on WTO rules post-Brexit even if other WTO Members object to its proposals for revised “schedules”? (2) Whether any post-Brexit UK-EU transitional arrangements will have to be approved by the WTO?

A copy of his speech is available here.

25 January and 8 February 2017

Christopher Muttukumaru CB writes that, thus far, the Brexit debate has focused purely on the UK wish list. What are some of the significant legal issues which the Commission and the other 27 Member States may need to consider in order to protect the EU’s interests? This post is based on a presentation at the Ministry of Infrastructure and Environment in The Netherlands on 18 January 2017 and updated to reflect the Government White Paper on the United Kingdom’s policy on exit from the European Union.

The UK Prime Minister has now made two speeches (2 October 2016 and 17 January 2017) in which she has set out her wish list for the upcoming Brexit negotiations. On 2 February, a White Paper was published by the UK Government (The United Kingdom’s exit from and new partnership with the European Union). This post covers some legal and legal policy issues that arise from the UK’s wish list, but from an EU perspective. This post should be read with earlier Monckton posts identified below.

The issues covered in this post. Although the picture is constantly changing, the issues arising from the UK wish list covered here are: (a) the instability that will result from the unknown numbers of agreements (and their content) that the UK wishes to negotiate and from the non-UK national constitutional implications that will inevitably flow from the EU/UK agreements; (b) the harm that could be done to the principle of uniform application of EU laws, to the extent that they continue to apply in the UK, if the UK successfully argues that it should  be free from the jurisdiction of the Court of Justice of the EU; (c) the question whether the UK’s plans to replicate the EU acquis in domestic law are capable of early and effective  enactment; (d) the question whether there will be any supervisory regime in place to enforce the replicated rules or the new UK/EU trade agreements after the European Commission ceases to have an enforcement role.

The UK Government’s wish list for the negotiations

By early January 2017, there were a number of emerging themes in the UK Prime Minister’s preferred vision of the UK’s post-Brexit future, including:

(a)The UK’s future was to be a global future;

(b) “It is not a… negotiation to establish a relationship anything like the one we have had for the last forty years or more. So it is not going to be a “Norway model”. It’s not going to be a “Switzerland model”…. I want it to include cooperation on law enforcement and counter-terrorism work. I want it to involve free trade in goods and services. I want  to give British companies the maximum freedom to trade with and operate in the Single Market – and let European companies do the same here…”

(c)  “…And we are not leaving to return to the jurisdiction of the European Court of Justice.”

That was a reasonably clear signal that the UK would not seek to retain membership of the Single Market or the EEA; nor would the UK accept the jurisdiction of the CJEU. Since the UK Prime Minister rejected the Norway model, that seems to suggest that she had similarly excluded the jurisdiction of the EFTA Court.

On 17 January 2017, the UK Prime Minister clarified her previous views: “…being out of the EU but a member of the Single Market would mean complying with the EU’s rules and regulations that implement the [Four Freedoms] …It would mean accepting a role for the [CJEU] that would see it still having direct legal authority in our country… So we do not seek membership of the Single Market. Instead we seek the greatest possible access to it… through a Free Trade Agreement. That…may take in elements of current Single Market arrangements in certain areas – on the export of cars and lorries, for example, or the freedom to provide financial services across national borders…”

Also on 17 January, Mrs May said that she would not want to be limited by the Common Commercial Policy or by the Common External Tariff. So she would not want the UK to be part of the Customs Union. But the UK did want a customs agreement with the EU.

The White Paper, published on 2 February 2017, shows signs of having been drafted in haste, largely cutting and pasting the UK Prime Minister’s earlier wish lists of 2 October and 17 January.

A summary of the overall position in the White Paper is this. There will of course have to be a withdrawal agreement under Article 50 of the TEU. Moreover, the UK “will pursue a new strategic partnership with the EU, including an ambitious and comprehensive Free Trade Agreement and a new customs agreement” (chapter 8 of the White Paper). In addition, to avoid a “disruptive cliff edge…we should consider the need for phasing in any new arrangements we require as the UK and EU move towards a new partnership” (chapter 12 of the White Paper) – in other words, a transitional agreement. Thus the UK seems to have in mind the probability that at least four agreements would be required to establish a new strategic partnership with the EU.

The Magical Mystery Tour had begun.

Point (a) Timing: the impact of uncertainty.

Leaving aside the extensive debate about how long the negotiations as such will take, there are a number of other unpredictable factors in respect of timing. Few observers would doubt that unquantifiable delay is going to result in instability, both for businesses and for individuals. Critically, on what basis should nationals of other Member States plan, for example, an entity considering investment in the UK; or an EU national resident and working in the UK planning for their future; or otherwise?

First the original starting point had appeared to be that the UK would seek (i) two agreements (withdrawal agreement under Article 50  and an agreement governing future legal  relations with the EU – a trade agreement) or (ii) three agreements (a withdrawal agreement, a long term trade agreement and  a transitional trade agreement ). In fact the better view is now that there is an option (iii) which is in play – four agreements (withdrawal agreement; free trade agreement; customs agreement; transitional trade agreement).

Secondly, what national constitutional requirements might be triggered in the 27 other Member States  by the agreements between the UK and the EU, however many there are? The withdrawal agreement will be governed by Article 50 and will be concluded by the Council and not by the individual Member States. It is unlikely to require ratification by each Member State. But the Article 50 agreement will be limited in scope and, in essence, will deal with the treatment of existing rights and obligations, including rights of residence , budgetary matters, and transitional measures. Any future trading agreement (and other agreements) will be negotiated in line with the Treaty provisions on agreements with third countries. A trading agreement (and other agreements) would therefore be subject to ratification in line with national constitutional requirements, if applicable. In other Member States, for example, there are bound to be  constitutional requirements which apply, including the possibility that  any agreement other than the withdrawal agreement could  be subject to a national referendum.

Thirdly, on 17 January 2017, the UK Prime Minister said: “…the Government will put the final deal that is agreed between the UK and the EU to a vote in  both Houses of Parliament.” This appears to mean that, before the UK signs the negotiated agreements with the EU, the UK Parliament will be given a chance to debate the deal(s)  and vote on it/them. Under the UK parliamentary system, depending on the kind of vote that is offered, that does not mean that the vote will be binding on the UK Government. But, if it is binding, and if the deal is rejected by Parliament in whole or in part, what is the scope  for further delay? Questions about  the type of vote, as well as its effect and timing, are under debate in the UK Parliament at the time of writing.

Fourthly, as a result of the judgments in the Supreme Court in the Miller litigation, new legislation has been introduced in the UK Parliament to permit the triggering of Article 50. But this is unlikely to undermine the timing of the Article 50 notice.

Point (b). Rejection of a continuing role for the CJEU

There are two aspects to the question  whether the Commission, acting on behalf of the 27 Member States,  should accept the UK negotiating position on CJEU jurisdiction – (a) in respect of the  EU acquis to be preserved by the Great Repeal Bill and (b) in relation to the Single Market rules to which the UK will have to adhere if it wishes to have partial access to the Single Market permanently or on a transitional basis. A Customs Agreement might raise different questions unless it replicates aspects of  the provisions of the Customs Union.

In the context of the UK wish list to enjoy such partial Single Market access , there are at least six issues which arise for other Member States to consider  if the UK continues to oppose the future jurisdiction of the CJEU. Some of these points apply equally to the EU acquis as will be preserved by the Great Repeal Bill.

First if the  UK wishes to have partial access to the Single Market permanently or on a transitional basis, that must mean acceptance of EU rules and regulations in those sectors. If so, is it plausible to think that the other 27 Member States would not  demand the uniform application of the same rules for all States  which are party to a new agreement under which partial UK access to the Single Market is permitted?

Secondly, although many Brexit supporters resist it (as do the UK Prime Minister and the White Paper), the rationale for a role for the CJEU is that it ensures that the law applies uniformly across the EU. As Mr Justice Bingham said in the Samex case, the ECJ (as it then was) could apply “… [its] panoramic view of the Community and its institutions, a detailed knowledge of the Treaties and of much subordinate legislation made under them, and an intimate familiarity with the functioning of the Community market which no national judge denied the collective experience of the Court of Justice could hope to achieve…”

Thirdly, the EFTA Court could be an option to deliver a measure of uniformity even though I have drawn the inference that that has been excluded by the UK. But Judge Bauchenbacher’s speech in October 2016 at King’s College, London, might offer a view of the EFTA Court’s jurisdiction and approach which might attract the UK Government. That said, it could be an uphill struggle to persuade the 27 EU Member States to agree.

Fourthly, the White Paper , having rejected a role for the CJEU (chapter 2) , recognizes that “ensuring a fair and equitable implementation of our future relationship with the EU requires provision for dispute resolution”. The paper continues:” Dispute resolution mechanisms ensure that all parties share a single understanding …of interpretation and application. “ The White Paper describes at length the dispute resolution mechanism in the CETA (Canada/EU Free Trade Agreement) model as an example of what could be agreed by the EU and the UK. Crucially, the 27 Member States, if they intend effectively to safeguard  the interests of their nationals, are likely to consider whether a dispute resolution mechanism which applies only at the international level with no direct effects in UK domestic law and enforceable at the instance of EU nationals, confers adequate protection on them.

Fifthly, a dispute resolution mechanism would not guarantee uniformity of legal approach. To the extent that the Single Market rules continue partially to apply to the UK  in a post Brexit world, there would be two supra-national judicial bodies whose views on the same rules could theoretically diverge. There could of course be provision made for a choice of forum  for disputes under the EU/UK consensus , but that would not adequately respond to the question of divergent jurisprudence. Moreover  if a preliminary opinion were sought of the CJEU on the compatibility  with the EU treaties of a dispute resolution mechanism,  the CJEU’s Opinion 2/13 on the Accession of the EU to the ECHR  might make uncomfortable reading for the 27 Member States and the UK.

Sixthly, if  it is eventually decided  that the UK Supreme Court should  become the final appellate court in cases involving relevant “preserved” parts of the acquis (or, far more improbably in respect of any new rules which are agreed in  EU/UK agreements), a critical issue will be whether the UK courts will be able, either by express provisions of the withdrawal treaty (and the Great Repeal Bill – see below ) or by rules of domestic judicial interpretation, to follow, or at least take account of, the judgments of the CJEU in respect of relevant preserved EU laws. Happily the White Paper seems to agree with the concerns expressed above since it asserts: “In general, the Government also believes that the preserved law should continue to be interpreted in the same way as it is at the moment” (chapter 1.5 of the White Paper). The question is: how will that be achieved?

The wise outcome would be for the parties to the withdrawal agreement and trade agreements to decide what should happen, both in a transitional period and beyond it. In that way, the 27 Member States would be properly protecting the interests of their commercial entities and citizens operating in, or living in (as the case may be), the UK.

Point ( c ) UK domestic legislation which implements  the consensus – the Great Repeal Bill

Under normal circumstances, the domestic implementation of an international agreement would be of limited interest to another Member State – unless their own national  interests might be at stake if the consensus is not properly implemented. At present, the Commission performs a watchdog role and protects the interests of all Member States.

On 17 January, repeating what had been said on 2 October 2016, the UK Prime Minister affirmed: “[Re certainty] We will provide certainty wherever we can…It is why , as we repeal the European Communities Act, we will convert the “acquis” …into British law…the same rules and laws will apply on the day after Brexit as they did before.”

This passage helpfully signalled the importance of legal stability after Brexit in the short term. An equally significant issue is what will happen in the long term since the proposal is to repeal, amend or reenact EU rules over the ensuing period.

But the issues are not limited to the existing EU acquis. In the light of the evolving signals from the UK Government, there  are at least three types of rights and obligations arising from the Brexit treaties which will have to be covered in the UK’s domestic laws: (a) rights under the present EU acquis; (b) rights under the withdrawal treaty under Article 50; (c) rights under the trade treaties, permanent or transitional.

Will the replication  scheme work as intended?

If, in the short term, the EU acquis is going to be replicated in UK domestic law, it inevitably means that the UK will protect EU Law rights and obligations until such time as the rules are revoked or amended. So it is a transitional measure, with no signal as to the UK Parliament’s likely future approach.

Unfortunately, the apparent clarity of the Prime Minister’s promise on 17 January in respect of legal stability  has been watered down in the White Paper  or, as the case may be, become more realistic. It now says: “…wherever practical and appropriate, the same [EU] rules and laws will apply on the day after we leave the EU as they did before [emphasis added] ”.  There are of course obvious problems with simple replication,  such as how to deal with cases where the European Commission would previously have had an enforcement role (see point (d)) but will no longer have such a role in a post Brexit world. But what else does the new qualification mean? We are promised a further White Paper on the Great Repeal Bill, which may answer some of these points.

In these cases, it is also self-evident that the rules will be incorporated as if they had been frozen at relevant time, eg. the point at which exit takes effect. What if, before the rules are subject to a process of domestic amendment or revocation, the rules subsequently change at the EU level?

Previous posts (see list at the end of this post) have covered the complexity of the replication exercise. One example is as follows. EU legislation is subject to the application of fundamental EU principles. It follows that the rules of interpretation requiring compliance with the fundamental principles will no longer apply unless the withdrawal agreement requires it (possibly as a quid pro quo for post hoc access to the Single Market) or the UK Government implements them. The rules would include principles such as non-discrimination on grounds of nationality, proportionality and fiscal neutrality. How, in this context, should EU businesses plan ahead if there are doubts about the level of protection that they will be afforded by UK domestic legislation?

Here are two further complications to keep in mind. First, by way of example, in evidence to the Environmental Audit Committee of the UK Parliament, the Secretary of State for Environment, Foods and Rural Affairs said: “We think that in the region of about two thirds of the [environmental] legislation that we are intending to bring  into UK law will be able to be rolled forward with just some technical changes, so roughly a third won’t, which means that obviously there will be work to do to ensure that those measures continue to work once we leave the EU”. This is hardly surprising. But from the perspective of EU entities or nationals seeking to plan ahead, might there be similar difficulties in other policy sectors?

Secondly, EU Member States will need to take into account the UK’s devolution arrangements, in particular in relation to  Scotland. Scotland enjoys considerable devolved lawmaking competence in a number of policy areas and may have its own views about how the EU acquis should be replicated.

Point (d) Policing the consensus

On the hypothesis either that replicated EU rules would continue to apply domestically or that, if continued access to agreed EU sectors was agreed, adherence to relevant Single Market rules would be the price of access, how would the preserved rules be enforced in a world where the Commission no longer had an enforcement function? The White Paper is silent in this regard.  The UK could of course establish new domestic supervisory bodies to carry out the functions of the Commission. But there would be no obligation to do so unless the trade agreements required it.  In any case, it is questionable whether the EU would be prepared to accept surveillance by a national body in  cases within the scope of  the trade agreements.

Things happen in negotiations. So far the UK Government has a wish list and the EU is waiting for notice under Article 50 before disclosing its negotiating position. Things will happen – compromise is inevitable if deals are to be struck. Meantime, how should a waiting world (businesses and individuals)  plan ahead for the lengthy period which the Magical Mystery Tour is likely to take?

Related posts:

George Peretz QC (11 October and 1 November 2016)

Christopher Muttukumaru CB ( 31 August, 5 October and 30 November 2016)

The Prime Minister today unveiled a new, more interventionist industrial strategy – intended to boost the UK economy after Brexit. Last year it appeared that part of that strategy would involve extending the Government’s powers to block mergers on non-competition grounds, but that aspect of the plan appears to have been scaled back.

In July, Theresa May said that it would have amounted to ‘asset stripping’ if the US drugs company Pfizer had been allowed to take over the British company AstraZeneca, opining that a “proper industrial strategy … should be capable of stepping in to defend a sector that is as important as pharmaceuticals is to Britain”.

This would have required changes to the UK merger regime, under which takeovers are generally assessed solely by reference to competition considerations – save where they could undermine defence, media plurality or financial stability.

Various concerns were raised. Among others, the CMA noted that allowing proposed takeovers to be blocked on the basis of additional non-competition criteria would make the merger regime less clear and less certain, which might reduce investment into the UK.

It seems that the Government has listened. No such proposal was contained in today’s Green Paper on industrial strategy, which instead acknowledges that the “UK has benefitted greatly from its open economy”.  In an interview with the Financial Times on Friday, the Prime Minister indicated that any changes were likely to be limited to mergers affecting critical national infrastructure, such as UK nuclear power plants.

This is likely to come as a relief to most competition lawyers, who will have plenty of other changes to get to grips with over the coming years as a result of Brexit (as discussed here).