Withdrawal Agreement Bill Policy and Context

Policy background

4 On 23 June 2016, a referendum was held in the UK and Gibraltar on whether the UK should remain a member of the EU. More than 33.5m people, some 72 per cent of registered voters, voted in the referendum and 52 per cent of those who voted, voted to leave the EU.

5 The European Union (Notification of Withdrawal) Act 2017 was passed into law on 16 March 2017. This gave the Prime Minister the power to notify the European Council of the UK’s intention to withdraw from the EU under Article 50(2) of the Treaty on the European Union. This notification was then given on 29 March 2017.

6 On 26 June 2018, the EU (Withdrawal) Act 2018 passed into law. Its purpose is to provide a functioning statute book when the UK leaves the EU.

7 On 13 November 2017, the previous Government announced its intention to bring forward a new Bill to implement the Withdrawal Agreement in domestic law. This confirmed that the major policies set out in the Withdrawal Agreement would be given effect in domestic law through new primary legislation, rather than by secondary legislation under the then EU (Withdrawal) Bill.

8 On 14 November 2018, the previous Government published a draft of the Withdrawal Agreement (agreed at negotiator level). This Agreement was agreed by European leaders on 25 November 2018 and laid before Parliament on 26 November 2018. The Agreement was subject to votes in the House of Commons as prescribed under s.13 of the EU (Withdrawal) Act 2018 (EUWA) on 15 January 2019 and 12 March 2019, whilst the Withdrawal Agreement alone, without the Political Declaration, was voted on by the House of Commons on 29 March 2019 (postponed to 31 January 2020). The Agreement was rejected in all these votes. The Agreement was also subject to a take note motions in the House of Lords.

9 On 6 March 2019, the previous Government announced that it would be bringing forward legislation designed to protect and enhance workers’ rights after the UK’s withdrawal from the EU.

10 On 22 March 2019 the European Council and the United Kingdom agreed to an extension to the Article 50 period until 22 May 2019, provided the Withdrawal Agreement was approved by the House of Commons before 29 March 2019 (postponed to 31 January 2020), or otherwise until 12 April 2019 (European Council Decision (EU) 2019/476, O.J. No. L 80 I, p.1). The definition of ‘exit day’ in the EU (Withdrawal) Act 2018 was amended by statutory instrument The European Union (Withdrawal) Act 2018 (Exit Day) (Amendment) Regulations 2019 (S.I. 2019/718) to reflect this having been approved by the House of Commons and the House of Lords on 27 March 2019 .

11 On 5 April 2019 the then Prime Minister wrote to the President of the European Council seeking a second extension of the Article 50 period. On 11 April 2019, the European Council and the UK agreed an extension to the Article 50 period until 31 October 2019 (postponed to 31 January 2020) (European Council Decision (EU) 2019/584, O.J. No. L 101, p.1). This extension could be terminated early if the Withdrawal Agreement was ratified and came into force before this date. Following the conclusion of the European Council, a statutory instrument The European Union (Withdrawal) Act 2018 (Exit Day) (Amendment) (No. 2) Regulations 2019 (S.I. 2019/859), was made under the negative procedure on 11 April amending the definition of ‘exit day’1 in the EU (Withdrawal) Act 2018 to 31 October 2019 (postponed to 31 January 2020) at 11pm.2

12 On 23 May 2019, Prime Minister Theresa May resigned. Following a change in Government, Prime Minister Boris Johnson committed to negotiating a new Withdrawal Agreement. This Withdrawal Agreement was agreed by European leaders at the European Council on 17 October 2019. In addition, the Government made a unilateral declaration concerning the operation of the ‘Democratic consent in Northern Ireland’ provision of the Protocol on Ireland/Northern Ireland.

13 On 19 October 2019, the Government laid before Parliament the new Withdrawal Agreement and new framework for the future relationship between the UK and the EU.

14 On 21 October 2019 the European Union (Withdrawal Agreement) Bill was introduced to Parliament.

1 ‘Exit day’ is defined by the EU (Withdrawal) Act 2018. The date of the UK’s departure from the EU is referred to as ‘exit day’ throughout this document.

2 Between the first and second extensions of the Article 50 period the procedure (found at paragraph 14 of Schedule 7 of the EU (Withdrawal) Act 2018) for exercising the power in s.20(4) of the EU (Withdrawal) Act 2018 to change the definition of ‘exit day’ in that Act was changed from the affirmative to the negative procedure. This was done by s.2 of the EU (Withdrawal) Act 2019, which received Royal Assent on 8 April 2019.

Approach of the European Union (Withdrawal Agreement) Bill

15 The UK has a dualist legal system, in which an international treaty ratified by the Government, although binding in international law, does not alter the laws of the state unless and until the treaty is incorporated into domestic law by legislation. This means that the UK Parliament has to pass implementing legislation before an international treaty can have effect domestically.1 This is a necessary step in the process of ratifying the Withdrawal Agreement as an international treaty.

16 The principal purpose of the Bill is to implement the Withdrawal Agreement, the separation agreement between the UK and the EEA EFTA countries (EEA EFTA Separation Agreement) and the Swiss Citizens’ Rights Agreement (together, ‘the Agreements’). Where provisions of the Withdrawal Agreement (or EU law made applicable by it) are capable of having direct effect, the Bill enables legal or natural persons to rely directly on those provisions in UK courts. The Bill provides for these three Agreements to have an equivalent legal effect in domestic law.

17 The Bill is designed to work in conjunction with the EU (Withdrawal) Act 2018. Provisions relating to citizens’ rights and the financial settlement will remain separate to that Act, but the implementation of other parts of the Withdrawal Agreement and the additional commitments will require amendments to the Act. Specifically, the Bill will amend the EU (Withdrawal) Act 2018 in order to give effect to the implementation period following the repeal of the European Communities Act 1972 (ECA) in section 1 of that Act. This will ensure that sections 2 to 4 of the EU (Withdrawal) Act 2018 will save, and incorporate into domestic law, that EU law which applied in the UK at the end of the implementation period – a date referred to the Bill as ‘IP completion day’. This law will then be subject to any changes made by the UK Parliament or the devolved legislatures, consistent with the UK’s international obligations. It will also be necessary to amend the EU (Withdrawal) Act 2018 to:

a. insert the clauses directly applying the Agreements (clauses 5 and 6) and also to insert the rules of interpretation that will apply to ‘relevant separation agreement law’ (clause 26);

b. insert the clauses which make provision for giving further domestic legislative effect via secondary legislation to provisions of the Agreements that rely explicitly on clauses 5 and 6, namely the provisions giving effect to the Other Separation Issues (as defined below) and the Northern Ireland Protocol.

1 In some cases, it may be that domestic legislation is already sufficient to ensure compliance with the international agreement or that compliance can be delivered without legislation.

The implementation period

18 The UK and the EU have agreed that the UK’s exit will be followed by a time-limited implementation period, which will last until 31 December 2020 (‘IP completion day’). The Bill also provides in clause 30 that any extension to the duration of the implementation period is subject to the approval of the House of Commons before it can be agreed, and provides a power in clause 37 to reflect in statute a single extension of up to two years. During the implementation period, common rules will remain in place, with EU (also known as Union) law continuing to apply to the UK under the terms set out in the Withdrawal Agreement.

19 Therefore, new pieces of directly applicable EU law that are introduced during the implementation period will continue to apply automatically within the UK, in line with Part 4 of the Withdrawal Agreement. Other new EU measures introduced will need to continue to be implemented domestically to comply with Part 4 of the Withdrawal Agreement.

Relationship to EU law

20 On ‘exit day’, the EU (Withdrawal) Act 2018 will repeal the ECA. Under the terms of Part 4 of the Withdrawal Agreement, it will be necessary to ensure that the EU Treaties and other EU law continues to apply in the UK during the implementation period. This will be achieved by way of transitional provision, by which the Bill amends the EU (Withdrawal) Act 2018 so that the effect of the ECA (modified as described below) is saved for the time-limited implementation period.

21 The Bill also modifies the saved ECA provisions to reflect the fact that the UK has left the EU, and that the UK’s relationship with EU law during this period is determined by the UK’s obligations under the Withdrawal Agreement, rather than as a Member State. The Bill will also make sure that existing legislation continues to operate properly during the implementation period, despite the fact that the UK is no longer a Member State. As such, the Bill will provide glosses to make clear how EU terms on the UK statute book should be read during the implementation period. For instance, the devolution statutes limit the devolved institutions’ competence by reference to EU law. The definition of EU law is, for these purposes, tied to the ECA: it means the rights, obligations etc arising under ‘the Treaties’ as defined in the ECA. The Bill preserves the effect of the ECA for the purposes of the implementation period, and modifies the definition of ‘the Treaties’ and ‘the EU Treaties’ to include Part 4 of the Withdrawal Agreement. Therefore, the references to ‘EU law’ in the devolution statutes will be read in light of Part 4 of the Withdrawal Agreement during the implementation period and those references will continue to impose restrictions during the IP on the competence of the devolved administrations and legislatures, as they did during the period of the UK’s membership of the EU.

Interaction with the EU (Withdrawal) Act 2018 and secondary legislation

22 EU rules and regulations will continue to apply in the UK during the implementation period. The Bill, therefore, amends the EU (Withdrawal) Act 2018 so that the conversion of EU law into ‘retained EU law’ and the domestication of historic Court of Justice of the European Union (CJEU) case law can take place at the end of the implementation period rather than on ‘exit day’. The Bill defines this point in time as ‘IP completion day’ at clause 37.

23 The Bill does not seek to change the purpose of the EU (Withdrawal) Act 2018, which is to provide a functioning statute book outside the UK’s membership of the EU. The amendments in the Bill are technical changes to ensure that retained EU law can operate as intended at the end of the implementation period.

24 The Bill also amends the deficiency-correcting powers in the EU (Withdrawal) Act 2018 to allow them to correct deficiencies arising both from withdrawal (i.e. from the UK leaving the EU and ceasing to be a Member State) and from the termination or any other effect of the implementation period. For instance, deficiencies could arise where:

a. the law does not function appropriately or sensibly because of the UK’s exit from the EU and the end of the implementation period, such as where a piece of legislation references an obligation ‘under EU law’, which no longer applies at the end of the implementation period. This reference may need to be amended, for instance, to a reference to the obligation under retained EU law, in order for the piece of legislation to continue to function usefully.

b. reciprocal arrangements which, as a result of Part 4 of the Withdrawal Agreement, no longer apply to the UK at the end of the implementation period. For instance, during the implementation period, the UK will need to continue to report to the European Commission on many issues. On IP completion day, the reference to the European Commission could be removed or replaced with reference to a domestic UK body or replacement UK domestic regime.

25 The amendments will not affect the procedures for the scrutiny of secondary legislation made under the EU (Withdrawal) Act 2018, including the system set out in paragraph 3 of Schedule 7 to that Act requiring the ‘sifting’ of certain statutory instruments proposed to be made by the ‘negative’ procedure.

Governance, enforcement and safeguards

26 Direct jurisdiction of the CJEU in the UK will come to an end with the implementation period. During this time, the UK and the EU have agreed that the existing EU mechanisms for supervision and enforcement will continue to apply in the UK. This will ensure that EU rules are interpreted and applied consistently in both the UK and the EU for the duration of the implementation period.

27 During the implementation period, the UK will maintain the same recourse to the EU’s judicial review structures as a Member State. Should the UK have concerns about the implementation or application of EU law during the implementation period, it will retain the same formal ability to challenge such action as Member States.

28 The ECA currently gives effect to the supremacy of CJEU rulings. This will be preserved during the implementation period, through the saving of the ECA. The Bill amends the EU (Withdrawal) Act 2018 so that provisions of that Act which end the jurisdiction of the CJEU in the UK will take effect at the end of the implementation period.

Remaining implementation of the Withdrawal Agreement

29 Article 4 requires that the provisions of the Withdrawal Agreement and the provisions of Union law made applicable by the Withdrawal Agreement produce “the same legal effects” in the UK as those which they produce within the EU and its Member States. In broad terms (and subject to the provisions of Article 4 itself), the intention is that the Withdrawal Agreement and the provisions of EU law applied by the Withdrawal Agreement have the same legal effects in UK domestic law as attached to EU law while were are a Member State. One effect of this is that legal or natural persons will be able to rely directly on some of the provisions of the Withdrawal Agreement before the UK courts.

30 The approach in the Bill is intended to give effect to Withdrawal Agreement law in a similar way to the manner in which EU Treaties and secondary legislation were given effect through section 2 of the ECA. Although the ECA gives effect to EU Treaties and secondary legislation, it is not the originating source of that law but merely the ‘conduit pipe’ by which it is introduced into UK domestic law. Further, section 2 of the ECA can only apply to those rights and remedies etc that are capable of being ‘given legal effect or used’ or ‘enjoyed’.1

31 The approach in the Bill to give effect to Article 4 is to mimic this ‘conduit pipe’ so that the provisions of the Withdrawal Agreement will flow into domestic law through this Bill, in accordance with the UK’s obligations under Article 4. The approach also provides for the disapplication of inconsistent or incompatible domestic legislation where it conflicts with the Withdrawal Agreement. This ensures that all rights and remedies etc arising under the Withdrawal Agreement are available in domestic law.2 The approach in the Bill is explained in more detail in the commentary below at paragraphs 120 to 138.

32 In some circumstances, provisions contained in the Withdrawal Agreement require further detail to be set out in domestic legislation to ensure rights and obligations etc are given full effect in the UK legal system. For example, Article 159 of the Withdrawal Agreement creates an obligation to establish an independent authority to monitor the implementation and application of the citizens’ rights part of the agreement in the UK. Domestic legislation will be required to establish the authority and to define its powers and purpose in line with the Withdrawal Agreement.

33 In a further example, although a qualifying EU citizen can rely directly in UK courts on some of the provisions of the citizens’ rights part of the Withdrawal Agreement, further provision is required to ensure UK legislation gives full effect to and is compatible with those rights. Therefore, the remaining provisions of the Bill make provision for how these parts of the Withdrawal Agreement will be implemented.

1 R (on the application of Miller and another) (Respondents) v Secretary of State for Exiting the European Union (Appellant) [2017] UKSC 5, paragraph 65. For further explanation of how EU Law applies in the UK please see http://www.legislation.gov.uk/ukpga/2018/16/notes/division/10/index.htm

2 This ‘conduit pipe’ does not apply to Part 4 of the Withdrawal Agreement which sets out the agreement on the Implementation Period.