This article is by David Green of 12 King’s Bench Walk.

The Brexit Department’s two position statements issued last week, on Enforcement and Dispute Resolution and Civil Judicial Cooperation,  show welcome progress by the UK government on the conflict of laws issues raised by Brexit. However, many Brexit-watchers will be disappointed that they do not go further than acknowledging broad areas of difficulty and setting out some very abstract possibilities for their resolution.

Of most practical importance to lawyers in the field is the Civil Judicial Cooperation paper. It ominously begins by confirming many suspicions that “when the UK withdraws from the EU, we will leave the civil judicial cooperation system that exists between EU Member States”, and that the UK will seek a new framework to replace the familiar system of the Rome I and Rome II Regulations, the Brussels Regulation (Recast), and the rest of the orders and regulations concerning non-criminal judicial cooperation.

Beyond this statement, the paper offers very little that is concrete on what the form of a future judicial cooperation framework might take: there is a lot of airy talk of the UK’s commitment to judicial certainty and the rule of law, and confirmation that the UK will continue to participate in the Hague Conference and Conventions on Private International Law, UNCITRAL, and the Lugano Convention.

Continued membership of the Lugano Convention – assuming the other members agree – provides a degree of the continuity with the pre-Brexit EU framework, since Lugano is based on the Brussels Regulation. However, it has not been updated since the Brussels Regulation was recast, and so it now differs markedly from the system that will continue in use in the rest of the EU post-Brexit.

The Enforcement and Dispute Resolution paper mostly concerns itself with possibilities for resolving conflicts between EU law and UK domestic law concerning the terms of the Withdrawal Agreement, and on related agreements where the UK and the EU will continue to cooperate post-Brexit. It concedes that, where international bodies aim for mutually intelligible enforcement of such agreements, there are three possible disputes that might arise:

  • Implementation disputes, where one party asserts that the other’s implementation of its obligations in its domestic arrangements is deficient in some way;
  • Disputes over subsequent actions, where one party considers that the other party’s legislative or executive actions taken subsequent to the agreement are incompatible with its obligations under the agreement; and
  • Divergence, where the agreement or its implementing legislation develops differently in the domestic systems of the parties to the agreement, as a result of differing interpretations by those parties’ legal systems.

The paper helpfully sets out a number of options for resolution of these disputes, mostly drawing on international precedents and other agreements with third countries to which the EU is a party: for example, joint committees, active and mutual monitoring of executive and judicial decisions, and binding arbitration models are discussed.

However, the paper fails to set out the UK government’s preferred model from among these options. This is perhaps no surprise. Even if the UK decides to implement EU legislation into its domestic legal system post-Brexit in identical terms, it is conceivable that the appropriate dispute resolution system for, say, energy and mineral resource cooperation (where highly integrated cross-border markets would not tolerate much divergence at all) might be different to the system which would best fit, for example, the agricultural sector (where post-Brexit continuity with the EU’s system is more about providing reassurance to farmers and businesses in the UK’s domestic market).

This proposition in itself seems prima facie sensible and flexible, two characteristics the UK government has been keen to stress throughout the process. However, the prospect that dispute resolution and enforcement measures might vary sector by sector, with an alphabet soup of technical committees and arbitration boards responsible for discrete areas, does not feel like the sort of freedom promised by Brexiteers during last year’s referendum. And this is before the question of judicial interpretation is addressed. Lord Neuberger’s pre-retirement plea that judges should be given clear guidance on the extent to which CJEU rulings are to be taken into account post-Brexit is likely to be unfulfilled, the more so if the meaning of “give due regard” varies according to the subject matter of the litigation. Even if the implementing legislation is drafted carefully so that resourceful judges and lawyers are able to navigate the landscape without too much difficulty, the consequences for public understanding – and thus for business certainty, respect for the legal system, and for the rule of law – are potentially serious.

Unfortunately, the frustrating lack of detail in this document is of a piece with the rest of the UK government’s approach. This is ultimately a temporary problem: there will be an agreement, of some kind, by March 2019, and it looks increasingly likely that a transition period will be agreed (if for no other reason than that the technical scale of the issues is such that they cannot be addressed in the tight two-year period provided by Article 50). There are, of course, opportunities in the legal sector whenever the legal outlook is ambiguous. But where the main winners are the lawyers, the bigger worries are for the losers. Our clients require greater certainty about the legal environment they will inhabit in 2019, and soon.

James Beeton

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