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18 February 2020

75: EU (Withdrawal Agreement) Act 2020 – part 2

The EU Withdrawal Agreement Act (the WAA) gives effect to the Withdrawal Agreement (WA) reached between the European Commission and the UK government in October 2019.

We considered last time how the WAA made provision for the transition period/implementation period (TP/IP) agreed in the WA, which runs from 31 January 2020 (exit day) until 31 December 2020. But the WAA also gives effect to the WA in other ways.

Domestic effect

First, the WA contains commitments on the part of the UK beyond TP/IP, eg the CJEU is to have jurisdiction to hear cases for up to eight years after IP/TP; certain rights under the WA will last for the lifetime of anyone who has accrued them.

Article 4 of the WA requires the UK to ensure directly applicable provisions of WA (and anything done under it) are given ‘the same legal effects’ in UK law as they would have in EU law and in the law of Member States. This enables legal or natural persons to ‘be able to rely directly on the provisions contained or referred to in this Agreement which meet the conditions for direct effect under Union law.’ Article 4 requires the UK to ensure compliance with these commitments.

The WAA gives effect to this element of the WA as follows:

  • section 5 gives effect to Article 4 by inserting new s7A into EUWA. This an equivalent provision to s2(1) and (4) of the ECA 1972, giving supremacy and direct effect to relevant provisions of WA (much as EU Treaties were granted supremacy and had direct effect during the UK’s EU membership). The WAA also provides for the ‘dynamic tracking’ of the WA and any EU law it co-opts (like the ECA did) so UK Parliament doesn’t have to do ‘domestic updates’; and
  • section 6 gives the same status to the UK’s agreements with the European Economic Area (EEA), European Free Trade Association (EFTA) and the Swiss.

Two clauses of the WAA appear to have been included in response to this ongoing application of EU law, to reassert the supremacy of UK courts and the UK Parliament.

Section 26 of the WAA allows a minister to make regulations specifying which courts can depart from EU laws. Section 6 of EUWA 2018 – as passed – had provided that, following Exit Day, any question as to the validity, meaning and effect of retained EU law was to be decided in accordance with, among other things, ‘retained EU case law’ – that is, the decisions and principles of the CJEU. Only the UK Supreme Court was excepted from this obligation: it was to treat CJEU decisions as equivalent to its own previous decisions, which it rarely departs from. EUWA further provided that UK courts were not bound by decisions of the CJEU made after exit day, ‘may have regard’ to those decisions ‘so far as it is relevant to any matter before the court’.

Section 26 of WAA changes that. It introduces a power for the government to specify the circumstances in which any lower court can depart from previous EU case law. It is not clear how these powers will be used but they effectively give the government power to remove the precedent effect of large swathes of EU case law.

Second, and more explicitly, s38 of WAA includes a clause specifically about parliamentary sovereignty.

‘It is recognised that the parliament of the United Kingdom is sovereign’.

This is a curious clause that simply reflects the current constitutional position on parliamentary sovereignty, namely, that under the UK constitution parliament is sovereign and so can make and unmake any law, but that in certain laws (originally the ECA 1972, but now EUWA as amended by WAA) it has provided that EU-derived law should be given overriding effect in the UK. So far as we can see, the clause therefore has no practical effect and has presumably been included for political reasons.

Ratification

Second, the WAA deals with ratification of the WA.

International treaties were historically negotiated, signed and ratified by the UK government without parliamentary approval. But some treaties need domestic law to be changed to ensure the UK meets its (new) international obligations, eg ECA 1972 was required re accession to European Community, so that the UK gave domestic effect to Community law. The Constitutional Reform and Governance Act 2010 (CRAG) requires government to lay a copy of a final treaty text before parliament and wait 21 sitting days to allow parliament to scrutinise the treaty. If there is a debate but no approval, the government can’t ratify the treaty.

The WA was not exempt from CRAG. In addition, EUWA 2018 s13 contained particular provisions re ratification of the WA, including the need for ‘meaningful votes’ which caused Prime Minister May such difficulties. The WAA removed all those requirements:

  • section 31 repeals section 13 of EUWA 2018; and
  • section 32 stipulates that Part 2 of CRAG does not apply to ratification of the Withdrawal Agreement.

So, by passing the WAA, the WA was approved by parliament and could be ratified, paving the way for the UK’s exit from the EU on 31 January.

Financial payments

The UK/EU financial settlement in the WA has three main components:

  • during TP, until 2020, the UK will pay into the EU budget almost as if it were a Member State, and receive funding from EU programmes;
  • the UK will also contribute towards the EU’s outstanding commitments as at 31 December 2020 (end of budget period) and UK recipients will receive funding for outstanding commitments made to them; and
  • the UK will share the financing of some EU liabilities as at the end of 2020 and will receive back a share of some assets. The UK’s most significant liability is likely to be EU staff pensions. The most significant return to the UK is likely to be its stake in the European Investment Bank.

The WAA establishes how the UK will make its financial settlement payments to the EU under the WA. This provides domestic authority for such payments, replacing the statutory authority in the ECA 1972 (which is repealed):

  • until 31 March 2021, the UK will make payments from the Consolidated Fund, so no need for parliament’s annual approval. As under ECA 1972. Or it can make such payments from the account it usually uses for its borrowing and lending (the National Loans Fund); and
  • after 31 March 2021, parliamentary approval will be required for most payments (but not for customs duties and sugar levies collected by the UK on the EU’s behalf) under the process of ‘annual estimates’.

Payments to the UK from the EU will be paid into the Consolidated Fund or, if the government wishes, the National Loans Fund.

Devolution

The WAA 2020 also makes provision in respect of the devolved institutions – the Scottish Parliament, Welsh Parliament and NI Assembly, and the respective administrations. It does this by altering the devolution statutes and EUWA:

  • to reflect the existence of the TP/IP;
  • to limit certain powers given by EUWA and the WAA to those devolved institutions’ devolved competences;
  • to amend the devolved institutions ‘legislative competence’ to allow them to make changes incompatible with EU law; and
  • to grant Ministers Henry VIII powers to enact Ireland/NI Protocol contained in the WA.

As regards the devolved institutions, it is worth nothing that, because the WAA’s provisions extend and apply to the whole of the UK, they gave rise to the need for a Legislative Consent Motion (LCM) to be passed by the devolved institutions. None of the three gave such consent.

Note too that the WA Protocol on Ireland/NI states that its arrangements are to be subject to a democratic consent mechanism in Northern Ireland. That mechanism is not included in the WAA. A UK government Declaration published on 17 October included a commitment to legislate for this before the first consent motion is required towards the end of 2024.

Citizens’ Rights

Finally, the WAA makes provision as regards citizens’ rights under the WA.

The WA section on citizens’ rights was largely unchanged from May’s WA. It provides a framework for continued legal residence (and associated rights) of those EU (including EEA EFTA and Swiss) citizens living in UK, and of those UK nationals living in EU (and EEA etc) at the end of IP/TP (referred to as the ‘protected cohort’). After the end of the IP/TP, these rights will be subject to future negotiations between the UK and the EU, within the framework set out in the political Framework on a Future Relationship.

The WAA 2020 largely delivers these commitments domestically using regulation making powers (including Henry VIII) in sections 7-15:

  • the establishment of the UK’s EU Settlement Scheme, to which EU citizens can apply to get the WA protections;
  • amending the Immigration Act 1971 and UK Borders Act 2007 as regards deportation of EU citizens;
  • establishing a new right of appeal against restrictions of resident’s rights – beyond the internal/administrative review by Home Office which already exists;
  • providing for social security co-ordination and equal treatment, equivalent to the long-established EU Social Security Co-ordination Regulations;
  • providing for non-discrimination and equal treatment of EU citizens, to ensure that EU nationals can continue to access benefits and services after the end of TP/IP;
  • establishing the Independent Monitoring Authority for the Citizens’ Rights Agreements’ to monitor the UK’s implementation of the citizens’ rights parts of WA; and
  • providing that UK courts can refer questions on the WA Citizens’ Rights provisions to the CJEU for eight years following the end TP.
‘Wa Wa, Wa Wa’ (Sam Collins, Wa Wa)

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Webinar

If you would like more information on EUWA, WAA and the WA, my colleague, David Mundy, and I have recorded a webinar with LexisNexis about Retained EU Law Post-Brexit.

The webinar is available here (please note that a subscription is required).

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