Insolvency (Amendment) (EU Exit) Regulations 2018

Lord Stevenson of Balmacara Excerpts

Tuesday 15th January 2019 Lords Chamber

[Lord Fox (LD)]

My Lords, in addition to the concerns which were very importantly raised on the nature of the drafting involved here and the use of powers, I have a couple of major technical quibbles. At the risk of treading into what may be the patented territory of asymmetry, which was just discussed, we seem to be back in an asymmetrical relationship here. We are changing our rules in the hope that Europe will reciprocate. That is my interpretation; if it is wrong, perhaps the Minister can update me. How forlorn or optimistic is this hope? What hope do those employees have of their rights and benefits being preserved—the Minister rightly highlighted that we need to have these processes in order to preserve them—for businesses which cross not just into the United Kingdom but into the rest of Europe?

The Minister’s point about courts was very interesting, because that of course was what the European Court of Justice was for: dealing with cross-border disputes over a similar group of rules. What the Minister describes is complicated, expensive and fraught with the possibility of failure. Perhaps the Minister can explain what benefits we will reap from substituting what we have today with what his department has set in front of us. So I have serious concerns that there are major problems with this SI.

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the Minister for introducing this issue. The SI seems to be welcomed by many in the industry and deals with a particularly difficult issue in a very constructive way, according to reports from those who have written to us. I agree with the points made by the noble Lord, Lord Fox. When the Minister responds, it would be interesting if he could be quite clear about whether the SI covers the minimum necessary to get the statute book in order if there is no deal, or whether, as he suggests, the Government will go a little further and lay out some sort of attractive regulatory pas de deux for the EU post Brexit which would make it easier to legislate for an asymmetrical solution. That is probably not quite what is happening here, but it would certainly be interesting to get the Minister’s response.

Given that the results are coming in of the vote in another place in which the Government’s proposals have been roundly defeated, we may be witnessing a transition to a slightly different arrangement, which we do not need to comment on just yet. In the circumstances it would perhaps be best to let the Minister respond to the points made. I hope to hear from him very shortly.

[Lord Lexden (Con)]

Before my noble friend replies, I will make just a couple of points as a current member of the Joint Committee on Statutory Instruments. I preface them by saying how greatly the committee will relish the praise that my noble friend heaped upon it at the outset.

The two points arise from the committee’s report. The first relates to Regulation 5(1), where the committee points out that it would have been far better if the department, despite the explanation that it provided, had avoided the ambiguity of language to which the committee drew attention by replacing vague concepts with clearer definitions, instead of continuing with its own approach.

The second point relates to Regulation 5(2), to which the committee drew attention because it appears to give very wide powers to the courts that will be called upon to adjudicate issues. Despite the department’s explanation, the committee remained concerned,

“at the breadth of the discretion conferred on a court by regulation 5(2)”.

It went on to say that this regulation,

“leaves it entirely to the courts to determine—on a case-by-case basis—what law they should apply in any particular case”.

I would be very grateful if my noble friend could touch on those points when he replies.