On 2 July 2020, the Ministry of Justice issued a consultation on proposals to extend the power in section 6 of the European Union (Withdrawal) Act 2018 (EUWA 2018) for courts and tribunals to depart from retained EU case law after the end of the transition period.


The government's preliminary view was that the power should be extended to additional courts and tribunals, as well as the Supreme Court and the High Court of Justiciary in Scotland (HCJ), but that the extension should be limited to more senior courts. After the consultation, and despite opposition from, among others, the Bar Council, the Law Society and the Financial Markets Law Committee, that is precisely what the government has now decided to do.

After the end of the Brexit Transition Period, which ends on 31 December 2020, section 6(3) of the EUWA 2018 provides that retained EU law that has not been modified will in broad terms be interpreted according to retained EU case law, and the retained general principles of EU law. The EUWA 2018 provides that the Supreme Court is not bound by any retained EU case law but can depart from it by applying “the same test as it would apply in deciding whether to depart from its own case law”.

In January 2020 the government passed the EU (Withdrawal Agreement) Act 2020 (EUWA 2020). This amended the EUWA 2018, creating the power to issue regulations allowing lower courts and tribunals not to be bound by any retained EU case law either.

The MoJ consultation considered how the powers to depart from EU case law should be implemented. It sought views on:

  • the use of the government’s power to designate additional courts or tribunals that can depart from retained EU case law;
  • how to specify the circumstances in which they may do so;
  • the test they must apply; and
  • which considerations should be considered relevant.

The consultation closed on 13 August 2020, with a number of respondents expressing concerns over the proposals to extend the power to depart from retained EU case law beyond the Supreme Court. 

The Bar Council (representing approximately 17,000 barristers in England and Wales), responded to the consultation indicating a strong preference that the power to depart from EU case law is reserved to the Supreme Court. The Law Society echoed this position in its own response, setting out its view that the Supreme Court is best placed to consider the full implications of any departures from retained EU law. The Law Society's view is that any change from this position constitutes a major shift in the administration of justice and could result in a lack of legal certainty through the emergence of novel judgments that are either not binding on other courts or are inconsistent with precedent. Similarly the Financial Markets Law Committee submitted a response urging HM Government not to extend the ability to diverge from retained EU case law, on the basis that doing so would introduce unnecessary uncertainty into UK law and could also create difficulties in establishing similarity with the EU’s financial markets framework for the purposes of equivalence assessments for access to the EU markets.

The government, after reviewing the responses to the consultation, has published draft Regulations that give UK courts at Court of Appeal level the power to depart from EU case law when they consider it "right to do so" (which is the test currently applied by the Supreme Court). In doing so it has said that EU case law should "evolve more quickly than otherwise might have been achieved", had the power been vested only in the Supreme Court and the High Court of Justiciary in Scotland, in order to reflect the UK's withdrawal from the EU. As it said in the consultation, it wants litigants to have "sufficient ability to seek a change to retained EU case law where it adversely affects them".

 

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James Damarell

James Damarell

Associate, Commercial Disputes
Leeds

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