EU Law in a transitional period

14 Jul 2016

How should practitioners plan for the uncertain period ahead? What happens to the application of EU Law between now and the enactment of the act of Parliament that will be required to repeal the European Communities Act , as well as to implement into domestic law any successor deal with the EU?

Whatever the long term future relationship between the UK and the EU, there would be a transitional period before any final arrangements were entered into. The period of negotiation could be lengthy , but there are no precedents for what is about to happen. On the one hand, an EEA relationship with the EU would be easier to negotiate with the EU but the UK would still have to negotiate direct with the non-EU EEA states . Could that be achieved within two years, from a standing start? On the other hand, if the replacement relationship with the EU was a bespoke set of arrangements, it is inconceivable that the negotiations could be concluded within two years.

In the short term, it might not matter in the strict sense, since the existing rules of EU Law would continue to apply in such a period. The UK could not repeal the European Communities Act or domestic secondary legislation implementing EU obligations until its exit pursuant to Article 50 of the TEU had become legally effective, although the two acts are likely to be coterminous to avoid a legal vacuum . If the UK were to do otherwise, it would be in breach of EU Law and Public International Law.

The doctrine of direct effect of directives would continue to apply, as would the direct applicability of EU regulations. The courts would also be obliged to continue to apply the ordinary rules of construction under which they are likely to strive to apply domestic rules consistently with EU Law. Cases before the courts in Luxembourg would continue to proceed. The courts’ rulings would continue to have effect . But, during the transitional period, while a full member of the EU, our political influence would lessen dramatically in respect of influencing the content of new legislation.

It is less clear what might happen in respect of legal relationships that are predicated on the applicability of EU Law where those relationships straddle the boundary between a pre-exit and post-exit world. An example might be consumer rights which derive from EU Law, such as those which arise from the Denied Boarding Regulation (Regulation (EC) 261/2004), which has direct applicability. The regulation provides airline passengers with rights to remedies for excessive delays to a flight and, in the short term , these consumer rights would be unaffected. But, while the EU legal framework would continue to have effect in a transitional phase, a significant problem for the consumer and the practitioner would be legal uncertainty for a post-Brexit future, not least in circumstances where the Regulation has hitherto generated considerable controversy.

How should lawyers assess future legal risk in an environment where no one knows what the long term UK settlement will involve? Is there a possibility that a lawyer’s understanding of rights, obligations , liabilities or expectations flowing from EU Law , which arise in a transitional period prior to exit but which are intended to outlast exit from the EU and to outlast repeal of the European Communities Act 1972 , might be undermined ?

In some cases, contractual arrangements or administrative arrangements with public bodies might be expressly agreed between relevant parties to clarify the understanding of both parties as to the possibility of different types of future longer term, post-Brexit relationships with the EU. In other cases, there are general provisions of section 16 of the Interpretation Act 1978 which might apply:

“General savings.

(1) Without prejudice to section 15, where an Act repeals an enactment, the repeal does not, unless the contrary intention appears…

(b) affect the previous operation of the enactment repealed or anything duly done or suffered under that enactment;

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under that enactment…”

Much clearly depends on the outcome of the negotiations and of the content of the repealing legislation. But it would be wise to make sure that the Government’s policy makers understand the risks of legal uncertainty for businesses, individuals and their lawyers, so that express provision can be made in the repealing legislation, if only for clarity’s sake.