Legislating for transition: A stay of execution for the European Communities Act?

The UK Government’s white paper: Legislating for the Withdrawal Agreement between the United Kingdom and the European Union, published July 24, sets out its intentions if a withdrawal agreement is reached between the UK and EU27. Such an agreement will not (likely) be reached before October’s European Council summit but could come even later. However, any agreement would need to leave enough time to ratify and implement the deal in advance of ‘exit day’ (29 March 2019).

We already have a fairly clear sense of the structure any withdrawal agreement will take, as the European Commission published a (colour coded) draft Withdrawal Agreement in March 2018, indicating the progress of the negotiations up to that point. This Insight will explain what the white paper reveals about how the Government will implement or amend EU law during a potential transition period.

A transition period

At the heart of those draft proposals was the assumption that there will be a ‘transition’ or ’implementation’ period, beginning with exit day and ending no later than 31 December 2020. During this transition period, the UK would continue to follow EU law on substantively the same basis as it does now. Although it would no longer be a Member state, it would have to follow (almost identically) the obligations of a Member state, except where the withdrawal agreement otherwise provided.

The Withdrawal Act “doesn’t do” transition

Such a transition cannot be delivered by the European Union (Withdrawal) Act, which was passed just over a month ago. That Act operates on the assumption that the UK will leave the EU on exit day. It chooses that day as the ‘switch-over’ point, after which the European Communities Act 1972 (ECA) is repealed and most (but not all) EU law is converted into domestic law (or ’retained EU law’).

If exit day is to stay at 29 March 2019, but the UK is to give effect to EU law ‘proper’ (rather than ‘retained’ EU law) beyond that day, fresh legislation is needed. A new Act of Parliament will have to amend the Withdrawal Act before the new scheme of ‘retained EU law’ replaces the ECA.

The Government’s proposal

Until the white paper was published, it was less clear exactly how the Government would make those changes. The Government had referred to a future ‘Withdrawal Agreement and Implementation Bill’ but had not yet explained how it would operate.

We now know this Bill will be called the European Union (Withdrawal Agreement) Bill. It would make changes to the Withdrawal Act to delay some of its key effects. Although the Withdrawal Act ‘repeals’ the ECA, the EU(WA) Bill will ‘save the effect’ of parts of the 1972 Act. However, the Government has also indicated the financial settlement for exiting will be dealt with separately: it will not rely on pre-existing implementing legislation.

The EU (WA) Bill will also deal with the knock-on effects of preserving EU law for a further 18 months and convert it only at the end of transition. The UK would continue to follow developments in EU law that happen after exit day, and those post-exit developments, it now appears, would form part of UK law when the conversion process formally happens.

The Withdrawal Act also confers several time-limited powers on government ministers. These powers enable them (pre-emptively and after the fact) to change retained EU law up to two years after exit day (making so-called ’corrections’). Regulations can also be used to ‘freeze’ aspects of the devolution settlement until new arrangements are put in place. The white paper explains that those time limits would, in the event of a transition period being agreed, run from the end of transition, rather than from exit day. These changes would also need to be included in the Withdrawal Agreement Bill.

What if there’s no agreement?

All of the above is predicated on the UK and EU27 actually reaching and ratifying a withdrawal agreement before 29 March 2019. In the absence of such an agreement, the default position is determined by Article 50 TEU and the Withdrawal Act. The EU Treaties would cease to apply to the UK two years after the notification of an intention to withdraw and the ECA is repealed at the same time. There can be no ‘transition period’ without a withdrawal agreement.

The only way to delay the ‘switch-over’ in the absence of a deal before exit day is to extend withdrawal negotiations between the UK and the EU under Article 50(3) TEU. Section 20(4)(a) of the Withdrawal Act allows exit day to be delayed to reflect such a change in date. This would mean that the UK would be a Member state beyond 29 March 2019.

The Government has said the UK will leave with or without a deal and that it would not request such an extension. Even if it were to ask, it would require unanimous agreement from the EU27.

 

Further reading

The status of “retained EU Law”, House of Commons Library.

What happens to EU funding after Brexit? House of Commons Library.

Brexit reading list: economic, business and transport policy issues, House of Commons Library.

 

Graeme Cowie is a Constitutional Law Researcher at the House of Commons Library.