Services of Lawyers and Lawyer’s Practice (Revocation etc.) (EU Exit) Regulations 2019

Lord Beith Excerpts

Tuesday 15th January 2019 Lords Chamber

[Lord Keen of Elie]

In relation to this particular instrument, I am not in a position to say where the Scottish Government are in processing such a proposal. That is a matter for them and it is not a matter that they would, as a matter of course, disclose to me. But, as I say, I have confidence that they are aware of the issue and they have decided that they will take it forward. If they had wanted to utilise the provisions of the Scotland Act to have the UK Parliament legislate for them in regard to this matter, they would of course have said so. The very fact that they have not is indicative that they are making progress to legislate for this on their own behalf. That is where we stand.

[Lord Beith (LD)]

Perhaps I might ask the Minister to tidy up the point that was raised earlier. What ensures that if there is some kind of deal, the provisions of this instrument fall away? Does it require some further statutory provision to do so—in effect, revoking the instrument—or does it fall away if there has not been an exit day? But surely if there is a deal, there is still an exit day.

[Lord Keen of Elie]

My Lords, in the event that we have a deal, we will repeal this instrument. It will have no further purpose in those circumstances. This is to address the issue of there being no deal—I emphasise that again.

--- Later in debate ---

Another problem is that most EU states do not allow so-called fly-in, fly-out services by third-country members, so that it would be impossible for UK lawyers to advise EU clients, represent them in cases involving more than one EU state, or play a leading role in global investigations. Some EU states require membership of their professional bodies, while others, such as Spain and Sweden, go as far as banning their lawyers from partnership with non-EU lawyers, and most EU states do not allow non-EU nationals even to seek admission to their national legal professions. The Explanatory Notes, in paragraph 12.1, make light of these issues, but what steps have the Government taken to clarify the EU’s intentions, either collectively or at a national level, in these matters, which have a significant potential effect on the profession and indeed, therefore, on the financial return to this country?

[Lord Beith]

My Lords, before the Minister rises to respond to the debate, I wanted to seek a little further clarification on the fact that this instrument will have to be repealed if there is any kind of deal. We ought to know what we are doing, and in this case we are perhaps being asked to pass a statutory instrument which does not within it contain the suicide pill which it would require to cope with the situation in which there was a deal. That has implications for the timetable and for all the things we have to do before 29 March, one of which might be to repeal not only this but a whole series of other statutory instruments, presumably either by a stack of single positive or perhaps negative instruments to achieve the repeal or by one omnibus statutory instrument. We have not been told enough about what this procedure would be, and it casts further doubt on the wisdom of proceeding at this stage with a statutory instrument which, of course, has all the problems that my noble friend and the noble Lord, Lord Beecham, referred to. My objective was to clarify what the mechanism would be; I think it would be the bringing forth of a further statutory instrument to repeal this one.

[Lord Adonis]

Before the Minister rises, I noted in his opening remarks that he did not refer to the consultation that had taken place. This is a big theme in the way that the House is seeking to scrutinise these statutory instruments, since there has been very rushed consultation or almost no consultation. Can he tell the House in his response what the consultation has been and what the response has been?

I observe, from a brief search of responses to these regulations, that they have not been particularly positive. I notice that the President of the Law Society, Christina Blacklaws, is quoted as saying that these regulations,

“will cause firms a significant amount of expense to find work arounds and, with tight margins, small and medium sized firms that employ EEA lawyers will struggle most to adapt”.

I think the House will be particularly concerned about the small and medium-sized firms. The larger firms can take care of themselves and can pay a lot of the costs and associated expenses, but small and medium-sized firms under pressure should be of concern to us. Can the Minister tell us more about the engagement there has been with such firms, how the costs might be mitigated, and tell us more about the response to the consultation at large?

I also make a general point, which is that I know that in a sense, everything we are doing in response to no deal is utterly deplorable; I do not want to repeat all the remarks I made earlier, although they apply here too, about how it is almost unthinkable that we should be making these arrangements for a cliff edge and all that goes with it. What is becoming clear again, in case after case, is not just that no deal will be deplorable but that the effects for this country over the medium term of withdrawing from the European Union will also be deplorable.

The noble Lord, Lord Beecham, quite rightly referred to the very large European market in legal services. We have fantastic lawyers, some of the best law firms in the world, and as the Minister said, we are a major centre for international legal firms. I do not remember whether it was the Minister or my noble friend who referred to the proportion of the largest firms that do work across the European Union, but it was a high proportion. Essentially, we are engaging in an act of self-mutilation. We are deliberately choosing to restrict the markets in which our legal firms can work and deliberately choosing to restrict the opportunities for the next generation of lawyers to be able to practise. That is, on any reading, deplorable.

Maybe the Minister, who is such a distinguished member of his profession, might rise to the occasion and say that he regrets that and wishes that we were not limiting the opportunities for our lawyers and our country in the way that we are. When the next generation of lawyers looks back and sees that their opportunities have been stunted and that the opportunities they have to practise in European markets have been withdrawn and that if they wish to do so they will need to move to the EU, maybe some of them will look back and say that the leaders of the profession who had responsibility at this period should have had a much closer regard for the interests of the next generation than they have had.