Exiting the European Union (Mediation)

Bob Stewart Excerpts

Monday 18th February 2019 Commons Chamber

[Lucy Frazer]

My hon. Friend is a member of the Justice Committee and has taken part in many debates on this subject. I know he has extensive experience of arbitration as well as mediation. I am very pleased that he is planning to go further on that. He must rest assured that the Government remain committed to mediation. It is a very important tool in the armoury to help people to resolve their disputes. Outwith this statutory instrument and the EU rules that we already have, as I will go on to explain, we have very strong domestic provision for mediation, and that will continue. The reason to bring forward this statutory instrument and the approach we have adopted is that the current arrangement with the EU is reciprocal and that following our leaving the EU we cannot rely on any reciprocity. This statutory instrument will therefore revoke the EU legislation.

In 2018, the European Council agreed a cross-border mediation directive which sought to harmonise certain aspects of mediation in relation to EU member state cross-border disputes. The aim of the mediation directive is to promote the use of mediation in such cross-border disputes. An EU cross-border dispute can be one between parties who are domiciled or habitually resident in two or more different member states, or it can be a dispute where judicial proceedings or arbitration are started in a member state other than the one where the parties are living. The UK, as a member state, enacted domestic legislation which gave effect to certain aspects of the mediation directive. I say certain aspects, because in many areas, such as ensuring the quality of mediation or information about mediation to the public, our existing arrangements already met the requirements or standards set out in the directive. However, to implement the directive the UK had to introduce some new rules for EU cross-border mediations involving UK parties.

The new rules first specify that if a time limit in a domestic law during which a claim could be brought in a court or tribunal expired during the mediation process, the parties could still seek a remedy through the courts or tribunals should the mediation not be successful. Secondly, the new rules define the rights of a mediator or someone involved in the administration of mediation to resist giving evidence in civil or judicial proceedings arising from information disclosed during a mediation. Various changes were also made to court rules to supplement the changes and to implement the requirements of the mediation directive relating to enforceability of agreements resulting from mediation.

Under the European Union (Withdrawal) Act 2018, the legislation implementing the mediation directive is retained EU law upon the UK’s exit from the EU. However, should the UK leave the EU without an agreement on civil judicial co-operation, the reciprocity on which the directive relies will be lost. Even if we were to continue to apply the enhanced EU rules to EU cross-border disputes, we would be unable to ensure that the remaining EU member states applied the rules of the directive to cross-border disputes involving parties based in the UK or judicial proceedings or arbitration taking place in the UK that were not otherwise in scope.

Accordingly, and in line with the Government’s general approach to civil judicial co-operation in the event of no deal, this instrument will repeal, subject to transitional provisions, the legislation that gives effect to the mediation directive’s rules on confidentiality and extension of limitation periods. It amends the relevant retained EU law in England, Wales and Northern Ireland, and in Scotland—in so far as it relates to reserved matters. Separate instruments will amend the related court rules in England, Wales and Northern Ireland. There is other legislation implementing the directive that is within the legislative competence of the Scottish Government, and I understand that they have decided to bring forward their own legislation in this area.

Turning to the impacts, this instrument is necessary to fix the statute book in the event of a no-deal exit. We have assessed its impact and have published an impact assessment. By repealing the domestic legislation that gave effect to the mediation directive, we will ensure clarity in the law applying to mediations between UK parties and parties domiciled or habitually resident in EU member states. We will also avoid a situation where mediations of an EU cross-border dispute conducted in the UK are subject to different rules on confidentiality or limitation from other UK mediations.

As I indicated, the instrument will change only the rules applying to what are currently EU cross-border mediations, and only in two respects: time limits and confidentiality. On time limits, claimants involved in such mediations who no longer have the benefit of an extended limitation period would, if they wanted more time to allow for mediation to take place, be able to make an application to the court and ask it to stay proceedings. Overall, this instrument will ensure that, post EU exit, UK-EU mediations are treated consistently under the law with mediations between UK-domiciled or habitually resident parties, or UK parties and parties domiciled or habitually resident in non-EU third countries.

[Bob Stewart (Beckenham) (Con)]

As I read it, fundamentally, for people who are seeking mediation, there will not be much change if the instrument is enacted.

[Lucy Frazer]

That is precisely the position. All that is happening with this SI is that we are going back to the position before the directive was implemented. It was implemented in 2011, so it has been in place for only a number of years, and we will still have all the rules that regulate domestic mediations, which take place across the country in various jurisdictions. This measure will impact only two very small areas—time limits and confidentiality—and as my hon. Friend highlighted, much will remain the same.

As I have set out, without a deal in place on 29 March 2019, certain EU cross-border mediations involving UK-domiciled parties—except for those that had started before exit—would no longer be subject to the mediation directive rules in EU member states. The Cross-Border Mediation (EU Directive) (EU Exit) Regulations fix that deficiency and ensure that both the courts and UK citizens have clear and effective rules to follow during a cross-border mediation dispute.

--- Later in debate ---

[Imran Hussain]

A number of objections have been raised, as I have set out, but the bottom line is that these regulations repeal legislation and mean effectively that the higher European standards will not be followed and that, instead, lower international standards will be.

[Bob Stewart]

But I thought I just heard the Minister say that in the matter of mediation, there will be very little difference, and that is what we are talking about: mediation.

[Imran Hussain]

Absolutely. The hon. Gentleman is right; we are talking about mediation. The Minister will know, and rightly pointed out, that there are two issues: time limits and confidentiality. This statutory instrument will repeal legislation that allows for extra time for that mediation, so that is substantially different. Perhaps the Minister can clarify that position in her closing remarks, because my understanding is that there is a substantial difference.

This statutory instrument would revoke and repeal the domestic legislation that enshrined in law the mediation directive. Many Members will be unfamiliar with the purpose of the mediation directive, but it is one of many examples whereby, through co-operation with our European partners, we have raised legal standards and protections across Europe. The European Statutory Instruments Committee—as raised by the hon. Member for Dudley South (Mike Wood)—considered whether this instrument could diminish rights. It found that it

“repeals legislation that extends the time limit for bringing certain claims in civil courts and employment tribunals to enable mediation”.

Some people may claim that legislation setting out the time limits for bringing civil claims is a minor issue, but it can have substantial real-world consequences. It could mean the difference between people being able to reach a mediated solution to a child contact case or not. The Government’s explanatory memorandum makes it clear that maintaining the standards of the mediation directive was an option available to the Government, but they have not sought to maintain the highest possible standards in all circumstances.

Why has the Minister not sought to maintain the highest possible standards? Can she guarantee today that if the statutory instrument passes and we move away from the high European mediation standards, people who rely on mediation for a family law matter—for example, a dispute over custody of a child—will be no worse off than they would have been had the mediation been conducted under the current European standards? I wait for her response, but she knows that the answer to that question is no.

For decades now, people from across the UK have travelled, lived and done business across Europe, safe in the knowledge that if something goes wrong they will be protected by legal systems that work, and work together. Many people from elsewhere in Europe have made their lives in the UK—some have started families, some created businesses, others are working in the NHS and other vital services—and they, too, trusted that they could rely on cross-border legal co-operation if something went wrong. That is why the Government’s failure to secure full judicial co-operation after we leave the EU is so damaging—it puts people’s rights at risk by lowering standards—and that is why we will vote against the SI. We in the Opposition know the Tories cannot be trusted to defend people’s rights.