The Government has now published its long awaited big Brexit bill. The European Union Withdrawal Bill, also known as Repeal Bill, provides a mechanism for ‘domestication’ of EU-derived law and repeals the European Communities Act 1972 that gives effect to the EU treaties in UK law. The latter function is necessary to regain the sovereignty that Britain lost when it joined the EU (although some of which may have to be relinquished to whomever is offering us a great deal). The former is a mechanism to gradually untangle the EU and UK legal orders.
The Repeal Bill works as follows. Imagine you are leaving your job and are tidying up unfinished business for a professional and dignified transition to another job, or another life. After years of engagement you have 2,000 business cards and one day to sort them. The best strategy is to put them in a big bag and comb through them later on.
This is what will happen when the EU acquis (the body of EU law) is being domesticated. In one stroke of a pen, or Delegated Act for that matter, EU Regulations and Directives are moved on to the UK statute book. I can hear you say ‘but EU legislation is already part of UK law, wasn’t this precisely the problem for many who voted to leave?’. Indeed, EU law is currently either directly applicable or is implemented into UK law. What the Bill does is to convert and preserve EU law. However, after we have left, MPs would be free to keep, amend, replace or remove EU originated law in the UK. What’s more, the Court of Justice of the European Union will no longer be able to issue rulings on this body of law.
Domestication of EU law prevents a regulatory cliff-edge where overnight, a significant number of laws would no longer apply upon the UK leaving the EU. The Repeal Bill ensures that laws are the same pre- and post-Brexit, and that changes will be gradual. However, its simplicity and nobleness are as tempting as deceitful.
Regulatory divergence, which occurs when two bodies of law grow apart, is eyeing us in the short and the long term. This could spell bad news for internationally operating businesses, whether from the UK or elsewhere. It will happen if the body of retained EU law is not updated with their version in the EU. Laws may be the same on leaving the EU, except that if we do not keep up with changes to EU law, we will quickly have an older version. Like operating systems that are not updated regularly, this can leave the door open to complications. Problems may get worse if legal patches are not provided. Also, changes of these laws by our own Parliament could result in more divergence if domestic issues are prioritised over barrier-free access to the single market.
A business cannot blindly assume laws will all remain the same post-Brexit, and clarity on the status of each piece of law is required. Has it been converted/preserved and can divergence be expected or anticipated? When will Parliament scrutinise it and could red tape be removed or be added? Which laws will be under negotiation and will they get the Repeal Bill treatment later on? Have Parliament or Government sneaked in policy changes when converting EU law?
Then the big question is: When is B-Day? Its due date of 29 March 2019 can be pushed back by extension and/or transition periods, or may not materialise at all.
The Brexit process is characterised by political setbacks, timing issues, lack of clarity and plans, leaving business in limbo and unsure how to capitalise on future opportunities. There is no doubt a mechanism for separating laws, such as presented in today’s Bill, is needed in the Brexit process. But can it repeal uncertainty?