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Retained EU Law (Revocation And Reform) Act 2023

Contents

Policy background

  1. On 23 June 2016, more than 17 million citizens of the UK and Gibraltar voted for the UK to leave the European Union (EU). Since then, the UK has pushed forward with building a framework for the future relationship between the UK and the EU through a series of pieces of legislation.
  2. The first step was to process the UK's departure through the EU (Notification of Withdrawal) Act 2017. This was followed by the EUWA and the European Union (Withdrawal Agreement) Act 2020.
  3. On 31 January 2020, the UK left the European Union. Pursuant to the Withdrawal Agreement, at the end of the Transition Period at 11pm on 31 December 2020, the UK recovered its full economic and political independence. As such, the UK is no longer part of the EU Single Market or the EU Customs Union, and is therefore no longer bound by its laws and regulations.
  4. The UK and EU signed a Trade and Cooperation Agreement on 30 December 2020 on the terms of their future relationship. This was implemented in the European Union (Future Relationship) Act 2020.
  5. To maintain legal certainty as the UK ended the Transition Period, the EUWA allowed for the retention of most EU law, as it applied in the UK legal system on 31 December 2020. EUWA incorporated EU law that applied to the UK onto the statute book as "retained EU law" (REUL), creating a new category of domestic law possessing most of the special features of EU law.
  6. REUL consists of a combination of EU regulations, decisions and tertiary legislation, domestic legislation passed to implement EU directives, general principles of EU law, directly effective rights and obligations developed in relevant case law of the Court of Justice of the European Union (CJEU), and other principles developed in that case law and the case law of the UK domestic courts.
  7. EUWA defined REUL by reference to three categories:
    1. Section 2 preserved EU-derived domestic legislation. This (typically) covers any primary or secondary legislation implementing one or more EU obligations, including those under EU directives.
    2. Section 3 incorporated direct EU legislation into domestic law. This is defined as all EU regulations, decisions or tertiary legislation that had direct application in the UK, including certain parts of the EEA agreement.
    3. Section 4 preserved any directly effective rights, powers, liabilities, obligations, restrictions, remedies and procedures in EU law into domestic law.
  8. Retained case law and retained general principles of EU law were applied to the interpretation of REUL, under section 6 of EUWA. The REUL framework established by EUWA, however, was not intended to be maintained indefinitely on the UK statute book. The Retained EU Law (Revocation and Reform) Act facilitates the amendment, restatement or revocation and replacement of REUL and assimilates REUL remaining in force after the end of 2023 by removing the special EU law features attached to it.
  9. To achieve this, the Act includes provisions outlined below.

Sunset of EU legislation

Sunset of EU-derived subordinate legislation and retained direct EU legislation
  1. This Act facilitates the revocation of 587 pieces of Retained EU Law (REUL) listed in Schedule 1. This REUL will sunset at the end of 2023.
  2. The sunset kick starts the process of reform and planning for future regulatory changes, which will benefit both UK business and consumers.
  3. The sunset, via a revocation Schedule, also increases business certainty by setting out clearly what will be revoked by the end of the year and to allow for business planning before this comes into effect.
Sunset of Section 4 EUWA Rights etc.
  1. This Act repeals all former EU directly effective rights etc. that continue to be recognised in domestic law, at the end of 2023. These rights were retained under section 4 of EUWA and by application of the principle of EU law supremacy.
  2. In order to provide legal continuity and ensure these provisions could be relied upon in legal proceedings after the UK left the EU, section 4 ensured the recognition and continuation in domestic law of directly effective rights, powers, liabilities, obligations, restrictions, remedies and procedures in EU law, which previously had effect in domestic law through section 2(1) of the European Communities Act 1972.
  3. This also allowed the continuation of legal effects of domestic legislation related to EU obligations that remained in force once the UK left the EU.
  4. This Act repeals these rights etc. and instead provides powers to legislate to codify these rights and obligations directly and more clearly into domestic statute.

Assimilation of retained EU law

Abolition of Supremacy of EU law
  1. The principle of the supremacy of EU law is a concept developed by the CJEU. The principle means that, where the domestic law of a Member State is found to be inconsistent with EU law, the latter takes priority.
  2. Under EUWA, this principle was incorporated into the UK statute book, so that the supremacy principle still applied in relation to domestic legislation that was made prior to the end of the Transition Period, after the UK’s exit from the EU. This ensured that domestic legislation related to EU obligations that remained in force after the UK left the EU continued to produce the same legal effects as before the UK’s departure. The principle does not apply to domestic legislation made after the end of the Transition Period.
  3. This Act abolishes the principle of supremacy of EU law in UK law at the end of 2023, so that it no longer applies in relation to any domestic legislation, whenever it was made.
Abolition of general principles of EU law
  1. General principles of EU law have been developed by the CJEU. CJEU case law provides that they may be used as an aid to the interpretation of the EU Treaties and EU legislation, and may be relied upon directly by individuals against EU institutions or national authorities acting incompatibly with them. There is no definitive list of general principles recognised in the CJEU case law, but examples include the protection of fundamental rights, and the principle of equal treatment.
  2. Under EUWA, general principles recognised by the CJEU case law before the end of the transition period were incorporated onto the UK statute book, but with some restrictions, so that they may only be used as an aid to the interpretation of REUL.
  3. This Act abolishes these retained general principles in UK law at the end of 2023, so that they no longer influence the interpretation of legislation on the UK statute book.
Assimilated law
  1. This Act removes the interpretive effects of EU law on the UK statute book through the sunset of section 4 EUWA rights, the abolition of supremacy and the abolition of general principles of EU law.
  2. This Act consequently renames REUL as "assimilated law" at the end of 2023 to reflect that these interpretive effects of EU law no longer apply to this body of law once these changes have taken place.
Interaction with relevant separation agreement law
  1. This Act does not affect the operation of the provisions of EUWA relating to relevant separation agreement law (RSAL), i.e. anything which is domestic law by virtue of section 7A or 7B or any domestic law that implements or is otherwise within scope of the Withdrawal Agreement, the EEA EFTA Separation Agreement, or the Swiss Citizen’s Rights Agreement (see section 7C(3) EUWA). RSAL includes any retained EU law, and in particular any EU-derived domestic legislation, which implement provisions of UK-EU Withdrawal Agreement (WA) including the Windsor Framework, the EEA-EFTA Separation Agreement and the Swiss Citizens’ Rights agreement.
  2. The reforms in Sections 2 to 6 of this Act leave intact the existing provisions of EUWA that give effect to relevant separation agreement law.
  3. Section 7A EUWA provides that "rights, powers, liabilities, obligations and restrictions… created or arising by or under the withdrawal agreement" have effect "in domestic law". Amongst other things, it ensures that EU law applied by the Agreement capable of applying directly will apply in domestic law without the need for any further implementing legislation. An EU Regulation required to be applied in the UK by the Withdrawal Agreement will continue to apply. This is undisturbed by the Act. Section 7A(3) expressly provides that "every enactment… is to be read and has effect subject to [section 7A]". That includes future enactments, including this Act.
  4. Furthermore, section 7C EUWA provides that the "meaning or effect" of RSAL "is to be decided, so far as they are applicable …in accordance with the withdrawal agreement". Amongst other things, this ensures that the principle of Supremacy, general principles of EU law and relevant CJEU case law (as they apply for the purposes of the Withdrawal Agreement) will continue to operate where applicable for the purposes of interpreting RSAL and giving effect to obligations under the Withdrawal Agreement and the Windsor Framework. That includes ensuring that any EU law that is required to apply in the UK by virtue of the Withdrawal Agreement or the Windsor Framework continues to be interpreted in accordance with those principles.
  5. This will continue notwithstanding the reforms made by the Act. Section 7C is undisturbed by the Act. The reforms by sections 2 to 6 of the Act are given effect by modifying EUWA. The relevant provisions of EUWA remain expressly subject to RSAL, which includes section 7C (see section 5(7) and 6(6A) EUWA as modified).

Interpretation and effect of retained EU law

Role of UK Courts
  1. The EUWA provided that UK domestic courts should remain bound by relevant CJEU judgments made on or before 31 December 2020. This provided legal certainty upon the UK’s exit from the EU and prevented the risk of considerable uncertainty for business over how EU law would operate.
  2. This has however contributed to establishing legal provisions with different rules of interpretation, meaning that EU case law has continued to influence the interpretation and application of REUL in the UK after the UK’s exit from the EU.
  3. The Government considers that the UK courts should have greater freedom to develop case law on REUL that remains in force in ways that are not unduly constrained by the continuing influence of previous EU case law. This Act addresses this by facilitating domestic courts departing from retained EU case law.
  4. This Act also gives the Attorney General and other Law Officers in the UK and devolved administrations the power to intervene in and refer cases to the higher courts, so that they may be invited to exercise their new discretion to depart from retained EU case law.
  5. In practice, interventions and references may not always lead to courts departing from retained case law. However, they will ensure that courts give full consideration to the appropriate influence of retained case law in the continuing development of domestic case law.
Compatibility
  1. Following the repeal of the principle of EU law supremacy, this Act establishes a new priority rule for retained direct EU legislation (RDEUL) to be interpreted and applied subject to domestic legislation.
  2. This Act also establishes the power to specify the legislative hierarchy between specified pieces of domestic legislation and specified provisions of RDEUL, including that which is assimilated after 2023.
  3. By exercising this power, the Government will be able to give priority to certain individual pieces of RDEUL. The power will sunset on 23 June 2026.
Incompatibility Orders
  1. This Act requires a court to make an "incompatibility order" where it concludes that a provision of RDEUL is incompatible with any domestic enactment, or vice versa where the power described above has been exercised.
  2. Where the court considers it relevant, the order could set out the effect of the incompatible provision in that particular case, delay the coming into force of the order, or remove or limit the effect of the operation of the relevant provision in other ways before the incompatibility order comes into force.

Modification of retained EU law

Scope of powers
  1. This Act modifies powers in other statutes, to facilitate their use to amend retained direct EU legislation (RDEUL) in the same way that they can be used to amend domestic secondary legislation. In effect this ensures RDEUL has a more appropriate status in UK law, downgrading it from primary to secondary status for the purposes of amendment.
  2. Schedule 8 to EUWA limited the use of such powers by treating Retained Direct Principal EU Legislation as equivalent in status to an Act of Parliament, however this legislation has not undergone the same detailed democratic scrutiny by the UK Parliament.
  3. This Act simplifies the status of RDEUL, ensuring that all RDEUL is treated as equivalent to domestic secondary legislation, thus clarifying that it may be amended in a similar way.
Procedural Requirements
  1. This Act removes the additional parliamentary scrutiny requirements that applied to the exercise of powers to make amendments to secondary legislation made under section 2(2) of the European Communities Act 1972.

Powers contained in this Act

  1. EU law evolved in order to meet the various needs of 28 countries, with differing economic and legal requirements. These laws no longer accurately meet the needs of the UK moving forward as an independent sovereign nation.
  2. This Act ensures that only those regulations that are appropriate for the UK will remain on the statute book, by creating a suite of powers that allow retained EU law to be revoked or replaced, restated or updated and removed or amended to reduce burdens.
Powers to restate
  1. This Act establishes a power to restate retained EU law. This power will enable UK Ministers and devolved authorities to clarify, consolidate and restate any secondary REUL to preserve the effect of the current law whilst removing it from the category of REUL.
  2. This Act also provides for the codification of the effects of retained case law and EU-derived principles of interpretation where necessary to maintain the existing policy effect. The power does not allow the function or substance of the legislation to change nor introduce substantive policy change.
  3. This Act also establishes a power to restate assimilated law or reproduce sunsetted EU rights, powers liabilities etc (section 11). This power achieves a similar policy effect as section 12, except that it acts on any assimilated secondary law and can operate up to 23 June 2026.
  4. This power will ensure legal certainty in areas of REUL where policy is not intended to immediately change and mitigate any unintended consequences associated with the sunset and the end of the special status of REUL on 31 December 2023.
Powers to revoke or replace
  1. This Act establishes powers to revoke or replace any secondary REUL. These powers give the UK Government and the devolved authorities the ability to revoke secondary REUL (or assimilated secondary law after the 31st December 2023), and to replace it if they wish to do so. The replacement can achieve the same or similar objectives (under subsection 2) or implement new provisions with different objectives as the Minister (or devolved authority) considers appropriate (under subsection 3).
Power to update
  1. This Act establishes a power to update. This power enables UK Ministers and devolved authorities to amend ‘any secondary REUL’ or ‘secondary assimilated law’ (i.e. including the codification of retained case law), as well as regulations made under the powers to restate and powers to revoke or replace under sections 11, 12 and 14 in this Act, to take account of changes in technology or developments in scientific understanding.
  2. The power is not intended to make significant policy changes, but is only intended to make relevant technical updates to REUL for these specific purposes. The power is designed so that it can be used more than once on the same piece of legislation as advances in science and technology take place over time.
Power to remove or reduce burdens
  1. This Act facilitates a small and targeted reform to the Legislative and Regulatory Reform Act (2006) (LRRA) to confirm that the existing parliamentary framework of Legislative Reform Orders (LROs) extends to retained direct EU legislation (RDEUL) and enables primary RDEUL to be amended within the current procedures and scope of the LRO process.

Retained EU law dashboard and report

  1. This section imposes a duty to report on retained EU law reform. This duty is two-fold. Firstly there is a duty to update the retained EU law dashboard. The second duty is to publish and lay before Parliament a report on the revocation and reform of retained EU law at set intervals.
  2. The retained EU law dashboard is the database of retained EU law maintained and made publicly available by the Secretary of State. It is an interactive list of retained EU laws. Since its launch, the public has been invited to explore this catalogue of retained EU law. The dashboard allows the public to explore what retained EU law there is and to see when it has been revoked or repealed or updated. The duty to update the dashboard in this Act ensures public scrutiny of the REUL reform programme.
  3. The second duty in the Act is a duty to publish and lay before Parliament a report on the revocation and reform of retained EU law. Each report must:
    1. summarise data on the retained EU law dashboard,
    2. set out progress made in revoking and reforming retained EU law during the relevant reporting period, and
    3. detail the Government’s plans for revocation and reform of retained EU law in future reporting periods, including a list of provisions of retained EU law which His Majesty’s Government intends to revoke or reform.
  4. This duty ensures that Parliament is adequately informed of the actions taken by the Government, and their future plans to revoke or reform retained EU law.

Business Impact Target

  1. This Act repeals the Business Impact Target (BIT) contained in the Small Business, Enterprise and Employment Act 2015, in order to make use of the UK’s regulatory autonomy now that we have left the EU, to ensure that regulation is fit for the UK economy, business and households.
  2. The repeal of the Business Impact Target (BIT) forms part of the Governments’ response to the ‘Better Regulation Framework’ consultation, as set out in the Benefits of Brexit Policy paper. It was determined that the BIT is not fit for purpose, as it fails to take into account the wider impacts of regulation outside of businesses.

Devolved Administrations

  1. The approach to engaging with the devolved administrations as part of this Act is consistent with other EU Exit legislation, including the European Union (Withdrawal Agreement) Act 2020 and the European Union (Future Relationship) Act 2020 (FRA).
  2. The Government has proactively engaged with the devolved administrations in order to ensure the Act works for all four nations.
  3. The Government also remains committed to respecting the devolution settlements and the Sewel Convention, and has ensured that the Act will not alter the devolution settlements and will not intrinsically create greater intra-UK divergence.
  4. The measures created by this Act are UK wide. This approach is consistent with other EU Exit legislation and will enable the devolved administrations to make provisions for REUL in areas of devolved competence. To achieve this, this Act provides the devolved administrations with the tools to amend, repeal and replace their REUL to enable further opportunities of Brexit to be seized.

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