53: Brexit – Different shades of white on white paper

The Government has published a White Paper, setting out proposals for a European Union (Withdrawal Agreement) Bill (WAB), which would implement the Withdrawal Agreement with the EU into domestic law.

This Bill is distinct from:

• the European Union (Notification of Withdrawal) Act 2017, which allowed the UK Government to trigger Article 50, to start the formal process of withdrawal from the EU; and
• the European Union (Withdrawal) Act 2018 (EUWA), formerly known as the Great Repeal Bill, which repeals the European Communities Act 1972, and contains the powers to prepare the UK’s statute book for Brexit by enabling EU law to be transposed into domestic law.

Of course, the Withdrawal Agreement itself remains in negotiation, and it is not clear that a deal will be reached. The new SSExEU, Dominic Raab, claims in his introduction to the White Paper that the Government ‘are making good progress in these negotiations’ (although he no longer has primary responsibility for them), but Liam Fox, and the Bank of England Governor Mark Carney both suggested earlier this week that chances of a ‘no deal’ exit were high. Until the Withdrawal Agreement is in place, the Government will continue to plan (in parallel) for a ‘no deal’ scenario by using the powers under EUWA to prepare the UK’s statute book for the UK’s exit from the EU on 29 March 2019 (and amending SIs are already being introduced to do that).

Because of that uncertainty, the White Paper deals only with ‘the provisions required to deliver the three parts of the Withdrawal Agreement which were agreed at the March European Council’ (ie transition/implementation period, citizen’s rights, financial settlement) plus the procedures for approval and implementation of the Withdrawal Agreement. It does not cover the ‘unagreed’ parts of the Withdrawal Agreement, such as Northern Ireland, governance and dispute resolution issues.

As Raab explains in his introduction:

‘The content of the European Union (Withdrawal Agreement) Bill will ultimately depend on the final terms of the Withdrawal Agreement. This White Paper sets out our early expectations for this legislation.’

That means the WAB, on introduction, may look very different from what is set out in the White Paper. Shades of white, perhaps.

Implementation: Changing EUWA so soon?

The White Paper proposes that the WAB modify two key elements of EUWA: the repeal of ECA 1972 (the principal legal mechanism by which EU law is given effect in the UK) on Brexit day (29 March 2019) and the transposition of EU into UK law on that day (in order to avoid a ‘black hole’ in the UK’s statute book). This is because, in March 2018, the EU and UK agreed (subject to the Withdrawal Agreement being agreed) that EU law would continue to apply in the UK during the transition/implementation period, ie to the end of 2020.

The Government now proposes that the WAB will amend EUWA so that:

• the effect of the ECA 1972 is saved for the transition/implementation period (ie to end 2020);
• the ‘transposition’ of EU law into UK domestic law takes place at the end of the transition period (not on ‘exit day’, 29 March 2019); and
• the EUWA sunset clause (which provides that the Government’s ‘correction’ power expires on 29 March 2021) is extended to the end of 2022.

The WAB will also modify the saved provisions of the ECA 1972 (so that the UK is obliged to apply EU law under the Withdrawal Agreement, rather than as a Member State) and provide for changes to UK laws during the transition period to reflect the fact that the UK is no longer a Member State (eg to read references to Member States as references to Member States and the UK).

All of which raises the question of why the Government insisted on a defining ‘exit day’ in the EUWA as 29 March 2019, while at the same time negotiating a Withdrawal Agreement which, in effect, provided for Brexit at the end of 2020. While 29 March 2019 was the logical consequence of the two-year notice period in article 50, could an extension of that period not have been sought at the earliest stage? Or was it simply a concession to the ERG, as a matter of political expediency, to show ‘Brexit means Brexit’?

Procedure: a tight squeeze

Which brings us to timing. In order for the Withdrawal Agreement to come into force once the UK has left the EU, three parliamentary processes have to take place by ‘exit day’ (ie 29 March 2019):

• approval of the final deal as negotiated under the Article 50 process (Parliament’s ‘meaningful vote‘), as set out in the EU (Withdrawal) Act 2018;
• the Government introduce the WAB ‘as soon as possible after Parliament has approved the final deal’;
• a final scrutiny process under the Constitutional Reform and Governance Act 2010 (CRAG), ie the Withdrawal Agreement must be laid before both Houses of Parliament for a period of 21 sitting days; and
• The Government can then ratify the Withdrawal Agreement.

Given the Withdrawal Agreement may not be agreed until November or December, the ‘meaningful vote’ may not happen until early 2019, and the time available to get the WAB through Parliament is likely to be extremely short.

The time to pass any SIs to cover the transition/implementation period (under the WAB) is even tighter. Presumably, given only a couple of months will be available, the Government envisage significantly fewer SIs being made under this power than the estimated 800 required under EUWA (now) for the period after transition/implementation.

Citizen’s Rights

On citizens’ rights, the proposed Bill will give legal effect to the rights conferred by the Withdrawal Agreement and will establish a new independent body to oversee the Government’s adherence to its commitments to afford ‘settled status’ to EU citizens resident in the UK who meet the criteria agreed in the Withdrawal Agreement.

This broadly entails granting settled status to those who have been resident in the UK for five years or more. However, the Government will use rules under the Immigration Act 1971 to deliver the EU scheme so that work can start before the Bill is enacted. The proposed Bill will also provide that any future repeal of the UK legislation implementing those rights will be subject to an ‘additional procedural step’ in Parliament, presumably to make any such repeal or divergence from commitments more difficult, and politically unpalatable.

Financial settlement: paying what’s due to end 2020

The UK has committed to make payments to the EU to address the EU’s funding obligations that arose during the UK’s participation in the EU budget (current budget period runs to end of 2020) and related to its broader membership of the EU. These commitments will be set out in the Withdrawal Agreement and the proposed Bill will put the payment mechanism on a statutory footing and create a mechanism for Parliamentary scrutiny of payments.

Will WAB happen?

There cannot be a WAB without a Withdrawal Agreement, and there is still a real possibility that will not be agreed, leading to a ‘no deal’ exit (subject to some ’emergency extension’ of the UK’s membership).

The Irish border question (including the ‘backstop’) remains unresolved, and the proposed solution is now inextricably wrapped up in in the negotiations over the UK and EU future relationship. The Commission is lukewarm on the UK’s current proposal as set out in the White Paper (discussed here), and the UK’s charm offensive around European capitals (appealing directly to the economic interests of Member States) is yet to bear any substantive fruit. Time is running short, even for a high level political agreement on a future relationship.

The next six months will be absolutely crucial.

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‘Forty different shades of white on white paper’ (Marillion, White Paper)