Brexit mini-series: (3) Retained EU Law

This blog post by Sam Cuthbert considers, in practical terms, some of the more prominent issues regarding Retained EU Law, Relevant Separate Agreement Law, and their interaction post-Brexit. Together these represent two of the major sources of law governing the UK’s relationship with the EU.

EU Retained Law

With effect from 31 December 2020 at 11 pm (“the IP completion day” – cf section 39 the Withdrawal Agreement Act 2020), EU law ceased to be applicable in UK courts.

The EU (Withdrawal) Act 2018 (“the 2018 Act) serves to maintain the rights, case law, and legislation (“Retained EU Law”) which have become a part of UK law in that period.  The purpose of Retained EU Law is to ensure that the end of the implementation period does not represent a cliff edge.

The 2018 Act therefore seems to preserve five categories of Retained EU Law:

1. Section 2: EU-derived domestic legislation. This is concerned with any existing UK legislation which relates to the EU or EEA, such as EU directive-implementing legislation. An example is the Health and Safety at Work, etc. Act 1974. 
2. Section 3: direct EU legislation. This includes any EU regulation, decision, or supplementing legislation (not EU directives, which are dealt with separately). Whilst obvious, it should be noted that, pursuant to paragraph 4 to Schedule 1 of the 2018 Act, UK citizens will no longer be eligible for compensation for losses suffered by reason of the UK government’s failure to transpose an EU directive per Frankovich v Italy C-6/90.
3. Section 4: EU rights. This includes any rights, obligation, powers, and remedies which existed in the UK before the IP completion day, such as directly effective rights under EU treaties. There is an open question about whether this includes rights derived from EU directives which have not been the subject of a judicial decision; one commentator argues convincingly that it does.
4. Section 6: retained case law. CJEU decisions preceding the IP completion day will remain binding on domestic courts (although they can be departed from by the Supreme Court or the Court of Appeal on the basis set out below). UK courts can still, however, “have regard” to CJEU decisions after this. The “preliminary reference” procedure has been removed (save for the exception set out below).
5. Section 6: retained general principles of law. These are essentially relevant to interpretation (rather than grounding rights of action in themselves): see paragraph 3 of Schedule 1 to the 2018 Act.

Retained EU Law was effectively frozen in its form at 11pm on the IP completion day such that any amendments made to EU community law thereafter will not be reflected in Retained EU Law.

Amending Retained EU Law

Retained EU Law may still be subject to amendment and addition in precisely the same way that domestic law may be, under section 6(7) of 2018 Act: “As that body of law is added to or otherwise modified by or under this Act or by other domestic law from time to time.”

Retained EU Law which is not subsequently modified by domestic legislation falls to be interpreted by UK courts in line with CJEU caselaw and EU law principles in place before the IP completion date. Where Retained EU Law is modified by domestic legislation, UK courts will interpret this in accordance with CJEU case law and EU principles where to do so would accord with the intention of the amendments (section 6(6)).

The Charter of Fundamental Rights

Under section 5(5) the Charter of Fundamental Rights is no longer a part of domestic law following the IP completion date, though section 5(5) qualifies that this does not affect the retention of fundamental rights or principles which exist irrespective of the Charter, in domestic law. Similarly, references to the Charter in the case law are to be read as references to retained fundamental rights or principles.

Supremacy

Section 5 of the 2018 Act holds that the principle of supremacy will remain relevant where a conflict arises between Retained EU Law and domestic law both made before the IP completion day.

But the EU principle of supremacy will not apply in respect of UK legislation which is passed or made on or after IP completion day. Legislation passed after IP completion day which is inconsistent with Retained EU Law will now take precedence.

This is subject to the caveat at section 6(4) and the European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case Law) Regulations 2020, which allow the UK Supreme Court and Court of Appeal to depart from CJEU decisions. In deciding whether to so depart the court must apply the same test as the Supreme Court would apply in deciding whether to depart from its own case law.

Section 26(1)(d) of the EU (Withdrawal Agreement) Act 2020 (“the 2020 Act”) inserts subsection 5A into section 6 of the 2018 Act. This widened the opportunities for UK courts to depart from CJEU case law by enabling Ministers to pass secondary legislation providing for “the extent to which, or circumstance in which, a relevant court or relevant tribunal is not to be bound by retained EU case law” and stating “the test which a relevant court or relevant tribunal must apply in deciding whether to depart from any retained EU case law”. This power extended only up until the IP completion day.

Relevant Separation Agreement Law

The EU (Withdrawal Agreement) Act 2020 provides the means by which the WA, the EEA EFTA Separation Agreement, and the Swiss Citizen’s Rights Agreement are adopted into UK law.

The Relevant Separation Agreement Law is too large and nuanced a topic to cover in significant depth in this article. However, it is worth noting that the 2020 Act operates to guarantee the direct effect of the rights conveyed by those agreements.

Section 7C(1), as inserted into the 2018 Act by section 26 of the 2020 Act, states that any question as to the validity, meaning or effect of any Relevant Separation Agreement Law is to be decided in line with the three agreements and consistency between them.

Preliminary References

Brexit has not completely sounded the death knell for preliminary references; the 2020 Act leaves open the possibility of preliminary references to the CJEU in specific circumstances.

Prior to the IP completion day, article 267 of the Treaty of the Functioning of the European Union (“TFEU”) enabled UK judges to request preliminary rulings concerning the interpretation of the Treaties as well as the validity and interpretation of acts of the institutions, bodies, offices, or agencies of the Union.

One such circumstance is created by article 158(1) WA, which permits a UK court to seek a preliminary ruling on a question from the CJEU, where that question involves the interpretation of the citizen’s rights provisions set out in Part 2 of the WA.

Hence, whilst the CJEU’s jurisdiction is greatly diminished after the IP completion day, the CJEU is nonetheless granted a new jurisdiction by the WA.

Supremacy

It is notable also that Section 5(7) of the 2018 Act makes its subsections 1 to 6 subject to Relevant Separation Agreement Law.

The effect of this is to subjugate the Retained EU Law – which may still be have supremacy over domestic law for those laws/decisions made before the IP completion day – to the Relevant Separation Agreement Law.

This will be of particular significance in respect of conflicts between rights conferred by domestic law, Retained EU law, and by Part 2 of the WA. It is also arguable that the supremacy of Relevant Separation Agreement Law over Retained EU Law, and the sustained facility for preliminary references to the CJEU undermines one of the principle political motivations for leaving the European Union in the first place.