Brexit update.

 

July saw the passing of the European Union (Withdrawal) Act 2018 which will repeal the European Communities Act 1972 (ECA) but retain EU legislation as part of UK law. The Act will come into effect on “exit day” which has been defined as 29 March 2019 at 11.00 p.m. Directly applicable EU law, which is currently given effect through s.2(1) of the ECA is referred to as ‘converted legislation’ and covers: EU regulations; EU decisions; EU tertiary legislation; Direct EU legislation as it applies with adaptations to the European Economic Area; and any other rights which are available in domestic law by virtue of section 2(1) of the ECA, including the rights contained in the EU treaties, that can currently be relied on directly in national law without the need for specific implementing measures. This corpus of EU law will be converted and incorporated into UK law immediately before exit from the EU. The second category of retained legislation is ‘preserved legislation’ which comprises: regulations made under section 2(2) or paragraph 1A of Schedule 2 to the ECA; other primary and secondary legislation with the same purpose as regulations under section 2(2) ECA; other domestic legislation which relates to the above, or to converted legislation, or otherwise relates to the EU or EEA. This corpus of legislation will be preserved as it exists immediately before exit from the EU.

Section 6 of the EUWB sets out the relationship between the CJEU and domestic courts and tribunals after exit. The validity, meaning or effect of any retained EU law is to be decided in accordance with any retained case law and any retained general principles of EU law, and having regard to the limits, immediately before exit day, of EU competences. Decisions of the CJEU made after exit day will not be binding on domestic (UK) courts. Domestic courts cannot refer cases to the CJEU on or after exit day and are not required to have regard to anything done by the EU or an EU entity on or after exit day. However, domestic courts, when interpreting retained EU law, will be able to consider post-exit EU actions including CJEU case law if they consider it appropriate. The UK Supreme Court (UKSC) and the High Court of Justiciary (HCJ) are not bound by either retained general principles or retained CJEU case law. In deciding whether to depart from any retained EU case law, the Supreme Court or the High Court of Justiciary must apply the same test as it would apply in deciding whether to depart from its own case law.

Section 7 gives ministers delegated powers to correct operability problems in converted and preserved legislation by way of statutory instrument, and to transfer the functions of EU authorities to UK public authorities and of creating new UK public authorities to take on those functions.

The Act means that most existing EU law will continue to apply as domestic law after exit day, although civil servants are going to have a demanding task making the necessary amendments to make sense of this transition – for example, references in the 2012 Brussels Regulation (recast) on Jurisdiction and Judgments will need to redefine ‘Member state’ so as to include the UK. However, there is no reciprocity in this exercise and this will be particularly felt with regards to the provisions of the Brussels Regulation on reciprocal enforcement of judgments. The UK will still enforce a French judgment under these provisions but France will no longer return the favour. It is likely that some reciprocity will be regained by the UK applying to accede to the 2005 Hague Convention on Choice of Court Agreements which would take about three months, although the process cannot be initiated until after Exit Day. The current parties to the Convention are the EU, Singapore, Mexico. The UK is currently party to the Convention through its membership of the EU but will cease to be a party on Exit Day. Many areas of maritime law fall outside the Convention. Article 2 excludes, inter alia, e) insolvency, composition and analogous matters; f)  the carriage of passengers and goods; g) marine pollution, limitation of liability for maritime claims, general average, and emergency towage and salvage; h) anti-trust (competition) matters; i)  liability for nuclear damage; j) claims for personal injury brought by or on behalf of natural persons; k) tort or delict claims for damage to tangible property that do not arise from a contractual relationship;

Arbitration will be unaffected. Enforcement of awards is subject to the 1958 New York Convention. The EU Regulations on choice of law in contract and tort, Rome I and Rome II, will also continue to function in EU courts as per usual as their choice of law rules are of universal application and are not tied to EU Member States.

After Exit Day the UK will be free to amend or repeal parts of this domesticated corpus of EU law. Two pieces of legislation immediately come to mind as candidates for this exercise. First, the universally unpopular  Regulation (EU) 2017/352 on Port Services which is due to come into effect five days before Exit Day. Second, the Brussels Regulation (recast) on Jurisdiction and Judgments could be amended, by including arbitration proceedings in art. 25, so as to permit once again the use of anti-suit injunctions to restrain proceedings commenced before the courts of an EU Member State in breach of a submission to arbitration in the UK.

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