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Following the triggering of Art 50, Anneli Howard assesses the possible ramifications of the Supreme Court’s Miller ruling, other associated litigation and key next steps for the UK’s withdrawal from the EU
The British are famous for their unwritten constitution, which has evolved over the last 800 years.
Changes to the constitutional settlement have evolved organically, such as the UK’s accession to the European Community (as it then was), the European Convention on Human Rights, devolution and use of referenda. In many ways, the litigation in R (Miller) v Secretary of State for Exiting the European Union was the perfect storm to strength-test the modern British constitution, including the balance of powers between the Executive, Parliament and Judiciary and the limits of representative democracy.
My involvement in the Miller litigation started on the eve of Friday 24 June 2016, when I was asked with my leader, Rhodri Thompson QC, to start drafting a letter before action to the then Prime Minister, David Cameron, to stop him giving notice under Art 50 of the Treaty on European Union (“TEU”) to the European Council in Brussels on Tuesday 28 June 2016. That was the first of many paradoxes in the Brexit saga. It was no small irony that the very remedy we were threatening – an injunction against the Crown – was only available because of the European Court of Justice (ECJ) requirements for effective judicial protection following R (Factortame Ltd) v Secretary of State for Transport (Case C-213/89).
For EU lawyers, Brexit raises a crucial question regarding the formalities that have to be satisfied at domestic level before an individual’s fundamental rights can be removed or limited by the State. Article 50 TEU is a novel untested insertion, drafted more as a deterrent than a reality. The requirements for notification are written in very simple terms, without any special formalities. All that is required is a prior decision to withdraw, taken in line with the departing state’s ‘constitutional requirements’. EU law, in line with the principle of subsidiarity, does not intrude into domestic affairs regarding the nation state’s own constitution nor the treatment of its own citizens. Article 50 TEU is meant to be silent on such matters.
However, that does not mean that an act on the international plane between States in the European Council can simply do away with domestic constitutional requirements. The validity of the international act depends, inherently and conditionally, on the prior valid authorisation conferred at national level. Article 50 TEU therefore provides a litmus test for the interaction between the international and national legal regimes as part of our dualist system.
Once triggered, Art 50 TEU will eventually reverse the instruction for our courts to recognise the supremacy of the EU Treaties and EU fundamental principles and the primacy of ECJ rulings; instead, they will listen solely to Parliament in areas that have been previously governed by EU law. But what constitutional safeguards have to be observed before that defining moment is triggered? The Supreme Court affirmed the 1610 Case of Proclamations that there is a fundamental constitutional principle whereby ministers of the Crown, acting as the executive or ‘junior partner in the relationship’, cannot set aside or deprive individuals of their fundamental statutory rights without the prior authorisation of Parliament. Such authorisation has to be in the form of an Act of Parliament, passed by both Houses and not just an order or motion or resolution.
It is by no means clear that Miller [2017] UKSC 5 signals an end to Brexit litigation. The judgment has ramifications for the UK’s withdrawal from other international arrangements, including notably Euratom and the European Economic Area (EEA) Agreement. The UK ratified the EEA Treaty with a separate Act of Parliament and there is a distinct withdrawal mechanism in Art 127 EEA which has to be complied with. Article 50 TEU, which is addressed to different institutions and different member states within a different time period, will not suffice.
The Art 127 proceedings were commenced by Adrian Yalland and Peter Wilding as part of the Single Market Campaign, arguing that the referendum did not mandate withdrawal from the single market and that, in line with Miller, any such withdrawal has to be effected via Art 127 EEA with the prior authorisation of both Houses of Parliament. The Divisional Court (Lloyd Jones LJ and Lewis J) declined permission for judicial review in February 2017 on grounds of prematurity on the basis that, in advance of the Art 50 notification and the Great Repeal Bill, the factual and legal matrix for declaratory relief remained unclear.
When the Prime Minister triggered Art 50 on 29 March 2017, the baton passed to the EU Council and the Parliament, which have now issued guidelines and a mandate for negotiations, expected to start in June 2017. In reality, the two-year window envisaged by Art 50 TEU will be shortened to just 17 months to leave time for the eventual negotiations to be ratified by the other 27 national Parliaments. It would be ironic if all the other member states were given the opportunity to approve the final outcome, but the UK Parliament (and its devolved administrations) was not.
Indeed, three luminaries of European Law – Sir David Edward KCMG PC QC, Sir Francis Jacobs KCMG PC QC and Sir Jeremy Lever KCMG QC – have published the ‘Three Knights Opinion’, concluding that it is a ‘constitutional requirement’ for both Houses of Parliament to ratify any negotiated deal with a further Act of Parliament before the end of the Art 50 process.
The Supreme Court is clear that it is inevitable, after withdrawal, that EU law will cease to apply to the UK and that there will be an inevitable loss of rights. Many of those ‘lost’ rights relate to ‘club membership’ rights such as agricultural subsidies, research grants and structural funding and procedural remedies (such as preliminary references and Commission complaints). Many other EU rights and obligations relate to cross-border activities that benefit from mutual recognition or ‘passporting’; their exact scope and effect post-exit will depend on the outcome of the Council negotiations.
Although the UK Parliament can legislate to recognise the rights of UK and EU nationals within the UK, it cannot guarantee the existence or enforcement of any rights in other member states or indeed on a pan-European basis. So, it will only be at the end of the negotiations that the full extent of the impact of the UK’s withdrawal on individual citizens and businesses will be known. Arguably, it is only at that point that a full economic impact assessment can be carried out and, following the Miller judgment, parliamentary scrutiny is required before such rights can be taken away. Litigation has been threatened if the government does not live up to its promises of effective parliamentary debate on the issue.
Much debate centres on the requirements of ‘effective’ scrutiny.
Article 50 TEU is drafted as a ‘rat trap’ so that if negotiations are not concluded by the end of the two-year period, the UK will automatically drop out of the EU without any EU future trading arrangements at all. It would have to fall back on the World Trade Organization rules, which would require substantial amendment to the schedules for each and every product listed. Businesses would most likely faces tariffs of between 5-20% on imports and exports in addition to the 25% sterling differential. For some sectors, notably agriculture, tariffs could be as high as 50% or indeed 90% for some products.
Given the potential impact of such tariffs on the competitiveness of UK businesses and the national GDP, it is all the more important that Parliament has a say which goes beyond a Hobson’s choice between ‘deal’ or ‘no deal’. That was the aim of the amendment sought by the House of Lords, which was rejected by the Commons on the basis of assurances given by the Prime Minister. The Three Knights Opinion goes further, arguing that parliamentarians need to have a vote before the final deal is put to the European Parliament at the last stage of the EU negotiations. It also canvasses the possibility that Art 50 TEU is revocable, a position which is supported by its author Lord Kerr, and that in the worst case scenario, the UK Parliament could revoke Art 50 or insist on an alternative version of Brexit, such as membership of the European Free Trade Association (EFTA) or the EEA, which would preserve the UK’s membership of the single market.
The Supreme Court did not address the issue of revocability, presumably because unilateral revocation is not possible in any event and therefore not within the government’s ‘gift’. Under international law, parties to international agreements can terminate or revoke acts by mutual agreement. There are pending proceedings in the Dublin courts, commenced on behalf of Jolyon Maugham QC, which actively seek a preliminary ruling on irrevocability. A preliminary hearing is expected in June 2017.
Revocable or not, the government is intent on pushing ahead with Brexit on both international and domestic fronts. It published a White Paper at the end of March. The Great Repeal Bill, which is due to be published shortly, will repeal s 2(1) of the European Communities Act and will re-patriate sovereignty to the UK Parliament. Once in force, some EU rights will be lost which may face challenge, particularly if the government resorts to Henry VIII enabling provisions. The Great Repeal Bill will be accompanied by numerous further Bills, currently estimated at 15 but possibly more, which will ‘cut and paste’ all outstanding EU laws, rulings and regulations in over 50 sectors to ensure parity with the EU regime. That is necessary to maintain the status quo and provide legal certainty for individuals and businesses during the negotiation period. It will also ensure that the UK is placed in the best position to secure a free trade agreement with the EU within the two-year deadline, by ensuring the maximum degree of convergence between the two legal regimes at the point of departure. Even if no deal is forthcoming, the UK may be able to secure the European Commission’s political recognition conferring the status of ‘equivalence’ for the purposes of securing passporting rights outside of the single market.
The negotiations will be tortuous and demanding; all the more so because of the two-year clamp. That period may be extended by mutual agreement but there is no guarantee that all states, including their federal regions, will accede to any such request. It is also clear that, whilst the more straightforward withdrawal agreement can realistically be secured within the two-year window, the hope of securing a free trade agreement covering over 50 business sectors within that time frame is somewhat optimistic. Recent negotiations with Canada and Georgia took over seven years to conclude and are still undergoing a further ratification and implementation period.
That could leave the UK in a legal vacuum until 2025 and beyond. It is therefore imperative that the UK secures a transitional agreement as a priority at the outset of negotiations to preserve rights and legal certainty for both UK and EU citizens in the interim. The EU Parliament has recently indicated that any transitional period will be for a maximum three-year period. In the meantime, individuals, global companies and SMEs should take all practical and legal precautions to protect their business operations and personal status during the turbulent times ahead.
Contributor Anneli Howard, Monckton Chambers, junior counsel in the Miller and Art 127 Brexit litigation
Anneli, Monckton Chambers, is a former référendaire at the ECJ and recognised for her expertise in EU law. She is standing counsel to the CAA; a member of the Attorney General’s A Panel and Public International Law Panel; and junior counsel for the lead claimants in the Art 50 and Art 127 Brexit litigation.
Changes to the constitutional settlement have evolved organically, such as the UK’s accession to the European Community (as it then was), the European Convention on Human Rights, devolution and use of referenda. In many ways, the litigation in R (Miller) v Secretary of State for Exiting the European Union was the perfect storm to strength-test the modern British constitution, including the balance of powers between the Executive, Parliament and Judiciary and the limits of representative democracy.
My involvement in the Miller litigation started on the eve of Friday 24 June 2016, when I was asked with my leader, Rhodri Thompson QC, to start drafting a letter before action to the then Prime Minister, David Cameron, to stop him giving notice under Art 50 of the Treaty on European Union (“TEU”) to the European Council in Brussels on Tuesday 28 June 2016. That was the first of many paradoxes in the Brexit saga. It was no small irony that the very remedy we were threatening – an injunction against the Crown – was only available because of the European Court of Justice (ECJ) requirements for effective judicial protection following R (Factortame Ltd) v Secretary of State for Transport (Case C-213/89).
For EU lawyers, Brexit raises a crucial question regarding the formalities that have to be satisfied at domestic level before an individual’s fundamental rights can be removed or limited by the State. Article 50 TEU is a novel untested insertion, drafted more as a deterrent than a reality. The requirements for notification are written in very simple terms, without any special formalities. All that is required is a prior decision to withdraw, taken in line with the departing state’s ‘constitutional requirements’. EU law, in line with the principle of subsidiarity, does not intrude into domestic affairs regarding the nation state’s own constitution nor the treatment of its own citizens. Article 50 TEU is meant to be silent on such matters.
However, that does not mean that an act on the international plane between States in the European Council can simply do away with domestic constitutional requirements. The validity of the international act depends, inherently and conditionally, on the prior valid authorisation conferred at national level. Article 50 TEU therefore provides a litmus test for the interaction between the international and national legal regimes as part of our dualist system.
Once triggered, Art 50 TEU will eventually reverse the instruction for our courts to recognise the supremacy of the EU Treaties and EU fundamental principles and the primacy of ECJ rulings; instead, they will listen solely to Parliament in areas that have been previously governed by EU law. But what constitutional safeguards have to be observed before that defining moment is triggered? The Supreme Court affirmed the 1610 Case of Proclamations that there is a fundamental constitutional principle whereby ministers of the Crown, acting as the executive or ‘junior partner in the relationship’, cannot set aside or deprive individuals of their fundamental statutory rights without the prior authorisation of Parliament. Such authorisation has to be in the form of an Act of Parliament, passed by both Houses and not just an order or motion or resolution.
It is by no means clear that Miller [2017] UKSC 5 signals an end to Brexit litigation. The judgment has ramifications for the UK’s withdrawal from other international arrangements, including notably Euratom and the European Economic Area (EEA) Agreement. The UK ratified the EEA Treaty with a separate Act of Parliament and there is a distinct withdrawal mechanism in Art 127 EEA which has to be complied with. Article 50 TEU, which is addressed to different institutions and different member states within a different time period, will not suffice.
The Art 127 proceedings were commenced by Adrian Yalland and Peter Wilding as part of the Single Market Campaign, arguing that the referendum did not mandate withdrawal from the single market and that, in line with Miller, any such withdrawal has to be effected via Art 127 EEA with the prior authorisation of both Houses of Parliament. The Divisional Court (Lloyd Jones LJ and Lewis J) declined permission for judicial review in February 2017 on grounds of prematurity on the basis that, in advance of the Art 50 notification and the Great Repeal Bill, the factual and legal matrix for declaratory relief remained unclear.
When the Prime Minister triggered Art 50 on 29 March 2017, the baton passed to the EU Council and the Parliament, which have now issued guidelines and a mandate for negotiations, expected to start in June 2017. In reality, the two-year window envisaged by Art 50 TEU will be shortened to just 17 months to leave time for the eventual negotiations to be ratified by the other 27 national Parliaments. It would be ironic if all the other member states were given the opportunity to approve the final outcome, but the UK Parliament (and its devolved administrations) was not.
Indeed, three luminaries of European Law – Sir David Edward KCMG PC QC, Sir Francis Jacobs KCMG PC QC and Sir Jeremy Lever KCMG QC – have published the ‘Three Knights Opinion’, concluding that it is a ‘constitutional requirement’ for both Houses of Parliament to ratify any negotiated deal with a further Act of Parliament before the end of the Art 50 process.
The Supreme Court is clear that it is inevitable, after withdrawal, that EU law will cease to apply to the UK and that there will be an inevitable loss of rights. Many of those ‘lost’ rights relate to ‘club membership’ rights such as agricultural subsidies, research grants and structural funding and procedural remedies (such as preliminary references and Commission complaints). Many other EU rights and obligations relate to cross-border activities that benefit from mutual recognition or ‘passporting’; their exact scope and effect post-exit will depend on the outcome of the Council negotiations.
Although the UK Parliament can legislate to recognise the rights of UK and EU nationals within the UK, it cannot guarantee the existence or enforcement of any rights in other member states or indeed on a pan-European basis. So, it will only be at the end of the negotiations that the full extent of the impact of the UK’s withdrawal on individual citizens and businesses will be known. Arguably, it is only at that point that a full economic impact assessment can be carried out and, following the Miller judgment, parliamentary scrutiny is required before such rights can be taken away. Litigation has been threatened if the government does not live up to its promises of effective parliamentary debate on the issue.
Much debate centres on the requirements of ‘effective’ scrutiny.
Article 50 TEU is drafted as a ‘rat trap’ so that if negotiations are not concluded by the end of the two-year period, the UK will automatically drop out of the EU without any EU future trading arrangements at all. It would have to fall back on the World Trade Organization rules, which would require substantial amendment to the schedules for each and every product listed. Businesses would most likely faces tariffs of between 5-20% on imports and exports in addition to the 25% sterling differential. For some sectors, notably agriculture, tariffs could be as high as 50% or indeed 90% for some products.
Given the potential impact of such tariffs on the competitiveness of UK businesses and the national GDP, it is all the more important that Parliament has a say which goes beyond a Hobson’s choice between ‘deal’ or ‘no deal’. That was the aim of the amendment sought by the House of Lords, which was rejected by the Commons on the basis of assurances given by the Prime Minister. The Three Knights Opinion goes further, arguing that parliamentarians need to have a vote before the final deal is put to the European Parliament at the last stage of the EU negotiations. It also canvasses the possibility that Art 50 TEU is revocable, a position which is supported by its author Lord Kerr, and that in the worst case scenario, the UK Parliament could revoke Art 50 or insist on an alternative version of Brexit, such as membership of the European Free Trade Association (EFTA) or the EEA, which would preserve the UK’s membership of the single market.
The Supreme Court did not address the issue of revocability, presumably because unilateral revocation is not possible in any event and therefore not within the government’s ‘gift’. Under international law, parties to international agreements can terminate or revoke acts by mutual agreement. There are pending proceedings in the Dublin courts, commenced on behalf of Jolyon Maugham QC, which actively seek a preliminary ruling on irrevocability. A preliminary hearing is expected in June 2017.
Revocable or not, the government is intent on pushing ahead with Brexit on both international and domestic fronts. It published a White Paper at the end of March. The Great Repeal Bill, which is due to be published shortly, will repeal s 2(1) of the European Communities Act and will re-patriate sovereignty to the UK Parliament. Once in force, some EU rights will be lost which may face challenge, particularly if the government resorts to Henry VIII enabling provisions. The Great Repeal Bill will be accompanied by numerous further Bills, currently estimated at 15 but possibly more, which will ‘cut and paste’ all outstanding EU laws, rulings and regulations in over 50 sectors to ensure parity with the EU regime. That is necessary to maintain the status quo and provide legal certainty for individuals and businesses during the negotiation period. It will also ensure that the UK is placed in the best position to secure a free trade agreement with the EU within the two-year deadline, by ensuring the maximum degree of convergence between the two legal regimes at the point of departure. Even if no deal is forthcoming, the UK may be able to secure the European Commission’s political recognition conferring the status of ‘equivalence’ for the purposes of securing passporting rights outside of the single market.
The negotiations will be tortuous and demanding; all the more so because of the two-year clamp. That period may be extended by mutual agreement but there is no guarantee that all states, including their federal regions, will accede to any such request. It is also clear that, whilst the more straightforward withdrawal agreement can realistically be secured within the two-year window, the hope of securing a free trade agreement covering over 50 business sectors within that time frame is somewhat optimistic. Recent negotiations with Canada and Georgia took over seven years to conclude and are still undergoing a further ratification and implementation period.
That could leave the UK in a legal vacuum until 2025 and beyond. It is therefore imperative that the UK secures a transitional agreement as a priority at the outset of negotiations to preserve rights and legal certainty for both UK and EU citizens in the interim. The EU Parliament has recently indicated that any transitional period will be for a maximum three-year period. In the meantime, individuals, global companies and SMEs should take all practical and legal precautions to protect their business operations and personal status during the turbulent times ahead.
Contributor Anneli Howard, Monckton Chambers, junior counsel in the Miller and Art 127 Brexit litigation
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