Brexit: Dispute Resolution and Enforcement (European Union Committee Report)

Lord Anderson of Ipswich Excerpts

Wednesday 17th October 2018 Lords Chamber

[Lord Anderson of Ipswich (CB)]

My Lords, I declare an interest. I am a member of the Bar Council Brexit working group, though I do not speak on its behalf. I have also been a barrister for 30 years, appearing regularly for individuals, businesses and the Government before the European Court of Justice in Luxembourg.

The grand chamber of the Court of Justice, with its elevated and distant bench, gold cloth hangings and majestic proportions, comes from a different forensic tradition from our own Supreme Court, where judges look advocates in the eye and engage them in dialogue at short range. However, in ways that matter, the Court of Justice has evolved—under the influence of its British and Irish members—in a direction that is both familiar and welcome to common lawyers. It treats its own judgments not as mere illustrations of principle on the continental model but as precedents, applied, distinguished and only occasionally departed from—much as we do in the common law. Though formulaic in style, those judgments are illuminated by opinions of the advocates-general, often as thoughtful and discursive as the best judgments of our own courts. Its judges have taken to questioning the advocates—or at least those who have the skills to make that exercise worthwhile—in a way that would be unusual, even improper, in some of the national courts in which they previously sat. The British Government have long been among the most influential interveners. As the noble Lord, Lord Thomas of Gresford, said, of all who come regularly before that court, they have also been the most successful in their own defence.

The relationship between national courts and the European Court, as expressed through the preliminary reference procedure, is co-operative, rather than hierarchical— based on the recognition that each court has a different function and on mutual good will and respect. Our courts have been adept in their use of that procedure, often pushing the Court of Justice to clarify the law and to define the remedies available to individuals who have suffered from administrative overreach or abusive market conduct.

What lessons for the future can we draw from that experience? I will mention first the transitional period, and then the future relationship. During the transitional period—during which we will remain subject to the full panoply of EU law—Articles 82 and 162 of the draft withdrawal agreement provide for the Court of Justice to rule on disputes arising under EU law or the withdrawal agreement itself. Perhaps that is inevitable. Can the Minister confirm whether those Articles have now been agreed? If they have, is it certain that the Court of Justice will lose its British members, familiar as they are with our legal systems, but appointed as they were by common accord of the member states? I understand that not everybody considers Article 6 of the withdrawal agreement— conclusive as it may be in relation, for example, to the Council—to be wholly clear in its application to members of the Court of Justice.

Even if the Government consider it necessary to submit during the transitional period to the authority of a Court of Justice without its British members—which seems rather a one-sided way of doing things—would they be equally sanguine if, as reported this morning, the transition period is substantially extended, say, to the end of 2021? Or might the exclusion of British members be revisited in the event of such an extension?

As for the future relationship, the plan, as I understand it from the White Paper, is to provide for a common rulebook for goods, supplemented by common rules on state aid, and a range of reciprocal commitments—from environmental requirements to labour standards, going well beyond those normally found in free trade areas. Our existing common EU rulebook is enforceable by any individual or company with an interest in doing so, before any national court and then, if necessary, before the Court of Justice. This highly developed and highly accessible system is needed, given the extensive integration required by the single market in goods. This integration is intended to continue. Yet we are proposing not a system of justice built around the individual, but one that is intergovernmental or statist in nature. As has been said, this is a joint committee of officials, backed by an independent arbitration panel which only it could invoke.

At present—I will not weary your Lordships with detailed examples, although my own case of ABNA illustrates the point—a business that falls victim to an ill-considered EU rule can go to court, whether in the UK or in another country where it does business. It can seek to have the operation of the rule suspended in those countries. Preliminary references can be made, and the Court of Justice may in the end declare the rule invalid. However, under the proposed future arrangement, it seems that it would depend on officialdom, in the UK and in the EU, to appreciate the urgent threats to its businesses and to take the necessary action. Whether UK officials would take up their cause would no doubt depend, as the noble Baroness, Lady Kennedy of The Shaws, has indicated, on many factors remote from the legal merits: its size; competing policy priorities within government; the wish not to pick too many fights in the joint committee; or the wish to avoid the public perception that the Government are relaxed about the policy that the rule is supposed to implement.

The only forum in which the validity of the rule could be challenged—assuming irreparable damage had not been done by then—would be under the Ukraine model, via the joint committee or arbitration panel to the Court of Justice. Could the companies that had brought the complaint be represented there, by the advocate of their choice, or would proceedings become a matter to be resolved on the basis of arguments between officials?

Each of the possible options looks less satisfactory than what we currently enjoy. But may I encourage the Minister to set his sights high and press for a system of remedies that fully supports the heartening emphasis of the committee on individual access to justice? Having declared my interest at the start, I hope I may count on him to make full use of the Bar Council and other sources of independent legal expertise to help design such a system.