UK Prime Minister Theresa May recently announced that the Government would soon be putting before Parliament the grandly titled Great Repeal Bill.
The Great Repeal Bill has two key aims. First, it will remove at a stroke the European Communities Act 1972 (ECA), the statute which currently gives direct effect to all EU law in the UK. Secondly, it will convert the body of existing EU law into UK law.
On the face of it, this approach is reassuring. The same rules will continue to apply until we are told otherwise. There will be no cataclysmic collapse on the day the UK leaves the EU, ie Brexit day, of everything to which the UK has grown accustomed over the past forty years. Instead, as time goes on, Parliament will consider the amendment, repeal or improvement of appropriate elements of what will now be UK - not EU - law. But is it really as simple as it sounds?
We consider below some of the complexities that are likely to arise and merit greater reflection at this early stage.
Regulations and Directives: A careful approach required
EU legislation comes in a variety of forms, of which the most important are Regulations and Directives. Regulations take direct effect across the EU without further action being required by a Member State. Directives need to be implemented separately into the law of each Member State.
Will the UK really want to adopt all Regulations on Brexit day, as Prime Minister May's announcement seemed to suggest? In some cases certainly - but not in all. It seems to us that there will need to be an initial exercise of pick and choose and a preliminary content review.
Example: The General Data Protection Regulation (GDPR) comes into force across the EU (including the UK) in 2018. If on Brexit the UK did not continue to adhere to the GDPR, it would be faced with an immediate gulf in data privacy law, as the current Data Protection Act will have been superseded by the GDPR before Brexit. Proceeding without a data protection law would be unpalatable, so the sensible course would be to simply extend the GDPR into UK law, initially through the Great Repeal Bill. That sounds straightforward enough, but there will complexities that need to be unravelled underneath the legislation. For example, the GDPR allows for the establishment of a European Data Protection Board (EDPB) tasked with a range of responsibilities to support consistent application of the GDPR across the EU. It is unclear what (if any) role the UK would have on the EDPB post-Brexit or the extent to which the UK would wish to follow its decisions. There is some precedent here though to suggest we will not see a clear break - Norway and Liechtenstein, who are members of the EEA but not the EU, actively participate in and follow the Article 29 Working Party. This is the body that the EDPB will replace, so it is quite possible that the UK would have an active relationship going forward. Clarifying what these relationships will look like and how they will work in practice and be followed in UK law is a level of operational detail that will require time and negotiation to work through over the next few years, beyond the Great Repeal Bill and top level EU-UK Brexit negotiations.
Some EU Regulations, such as those that reflect EU policy on state aid or the EU Merger Regulation (EUMR) may simply no longer reflect UK Government policy. They clearly cannot be dropped wholesale into UK law.
Example: The EUMR provides that certain transactions that meet the turnover tests for its application must be notified to, and approved by, the European Commission prior to completion. Such transactions are currently carved out of UK merger control. The Government needs to decide whether post-Brexit this remains appropriate or whether - more likely - UK merger control law should apply to such transactions.
In contrast, Directives will already have been implemented into UK law, so on the face of it will not need to be a part of the Great Repeal Bill at all. However some Directives may also immediately become at least partly irrelevant or inapplicable. This will need to be assessed at an early stage. Others will become so over time: Post-Brexit, even if the UK does not repeal or amend Directives, it will presumably not automatically incorporate amendments to them that emanate from the EU.
Further amendments needed: Reflecting a different context
Even where legislation is adopted wholesale in the case of Regulations, or has already been implemented in the case of Directives, it is likely still to need contextual modification to reflect the fact that the UK is no longer an EU Member State, along with modification to deal with references to EU institutions that will no longer be relevant.
Example: The Public Contracts Regulations 2015, which implement the EU Public Procurement Directive, require contracting authorities to publish their intention to tender a contract in the Official Journal of the EU (the official record of the EU). This requirement exists to ensure that procurement opportunities are advertised across the EU and not just in the Member State concerned. Assuming that the UK withdraws from the single market, references to the Official Journal will likely be obsolete and the UK's Public Contracts Regulations would need to be modified to remove references to it accordingly (and perhaps replace with a UK equivalent).
Where enforcement currently depends on institutional oversight from the EU, thought needs to be given to where this will come from post-Brexit and how this is reflected in the Great Repeal Bill. This is likely to be a complex exercise in practice. If the plan is for the UK to provide the oversight itself, it will also need to resource accordingly in the relevant areas.
There may also be UK legislation that needs to be amended to reflect the new reality. For example, Section 60 of the Competition Act 1998 requires the UK competition rules to be interpreted in a manner consistent with the competition case-law of the European Court of Justice (CJEU).
European case law: Will it still bind?
Currently the UK courts are bound by decisions of the CJEU. These decisions form part of UK law. We assume that this will continue to be the case at least initially.
However in a recent statement David Davis, Secretary of State for Exiting the European Union, noted specifically that post-Brexit the jurisdiction of the CJEU would end with the repeal of the ECA. The Supreme Court will be re-established as the English court of final appeal. Whilst a question of EU law outside the jurisdiction of a UK court can currently be referred to the CJEU, in a post-Brexit world, such referrals will disappear.
This makes sense, but divergence with the remaining EU Member States on the interpretation of EU law, to the extent such law continues unamended on the UK statute books post-Brexit, is inevitable over time. Future CJEU decisions will not bind UK courts (although they might potentially carry some persuasive authority or influence with them). We anticipate that a line will have to be drawn between the binding nature of pre- and post-Brexit CJEU caselaw.
The bigger picture: The EU's relationship with non-Member States
The Great Repeal Bill is only attempting to deal with the UK's relationship with EU law. It does not assist with the wider picture, comprising amongst other things the EU's many external agreements with third party non-Member States. For example, the UK currently benefits from air traffic rights negotiated with third states at an EU level - such as the bilateral "open skies" aviation agreement between the EU and the US. There are also a number of free trade agreements with third states, and a raft of arrangements with Switzerland. Upon Brexit, the UK loses the benefit of these agreements. The Great Repeal Bill appears to plug none of these gaps.
Some EU legislation will also continue to affect UK companies as the UK becomes, for these purposes, a third state.
Example: UK companies that enter into agreements which may affect trade between EU Member States and which have as their object or effect the restriction of competition within the internal market or which abuse a dominant position within the internal market in so far as it may affect trade between EU Member States will continue to be subject to EU competition law. Since the European Commission asserts and effects jurisdiction, competition cases involving UK companies will continue long after the UK leaves the EU.
Impact of exit negotiations: A drafting challenge
Inevitably much will change as the exit negotiations get underway. Government will have to find a way of bridging the gap between the latest draft of the Great Repeal Bill and the latest status of negotiations, the final outcome of which may not be known until close to the date of the UK's exit (and therefore the date on which the Great Repeal Act is enacted). It is likely that the Bill will be announced in the Queen's speech in May 2017, shortly after (on Prime Minister May's current timing) the UK notifies its intention to leave the EU pursuant to Article 50. In practice, the Act may be passed some time prior to Brexit day, with its commencement likely to be designed to coincide with that date. This therefore provides scope, in theory, for the Great Repeal Act to be amended through the exit negotiation process following the Article 50 notice (in which case its initial terms may prove a useful starting point for discussion).
At present, no-one can know what the outcome of the negotiations will be. Looking just at the question of access to the single market, the possible outcome ranges from the UK retaining complete access to the single market to the UK retaining no access at all. We may end up somewhere in the middle. In some instances, the UK might accept continuing oversight from certain EU institutions in agreed areas. Those working on the Great Repeal Bill are likely to be struggling constantly to keep up with the negotiations and there could be practical sequencing issues as a result.
Any Great Repeal Bill will have to pass through the UK Parliament in order to become an Act.
In addition, there may be an issue for the devolved parliaments/assemblies. Under the Sewel convention, the UK Parliament would not normally legislate in areas of devolved competence without the consent of the devolved parliament. Any Great Repeal Bill would likely cut across devolved competencies which would, normally, trigger a legislative consent motion in the devolved institution. Whilst there is some debate about the formal status of the Sewel convention, it does raise the wider question about the legal and constitutional impact of any Great Repeal Bill on the law of Northern Ireland, Wales and Scotland.
Conclusion: Significant complexities
Overall, while on paper the Great Repeal Bill is a simple-sounding solution, it will need to be quite a complex beast in practice, and subject to change right up to the point when it comes into effect. Even if it is to deal with the immediate short term issues, some of which are considered above, it may well have to be broken down into a number of chapters, each reflecting the slightly different treatment required sector by sector.
Over time, as the UK goes through a process of independent policy making and legislates accordingly, consideration will need to be given as to what this does to the Great Repeal Act. Ideally the Bill itself will attempt to deal with the question of how, once the UK no longer needs particular elements, these can be removed.
Overall, the drafting of the Great Repeal Bill is therefore no easy task. That said, whatever approach is taken to the untangling of EU legislation from the UK, some uncertainty and inconsistency is highly probable.
Prime Minister May's speech will undoubtedly be a helpful catalyst for flushing out areas where further reflection is needed. The question is to what extent these areas can be identified and adequately dealt with before the Bill becomes an Act. For the time being, it seems unlikely that we have seen the end of Brexit uncertainty.