Draft Challenges to Validity of EU Instruments (EU Exit) Regulations 2019

Richard Bacon Excerpts

Monday 18th March 2019 General Committees

[Mr Richard Bacon (South Norfolk) (Con)]

It is a pleasure to serve under your chairmanship, Mr Davies. I have a couple of quick questions for the Minister. I completely understand the Government’s desire to achieve legal certainty, which is, as he himself said, the purpose of the regulations.

Paragraph 2.1 of the explanatory memorandum clearly states:

“On exit day, the EU Withdrawal Act makes clear that there will be no right in domestic law on or after exit day to challenge any retained EU law on the basis that, immediately before exit day, an EU instrument was invalid.”

Is that designed to oust a challenge on any other grounds? It sounds suspiciously like an ouster clause. The Minister will know from history that the courts in this country are reluctant to entertain Governments’ attempts to remove the purview of the courts entirely, and it does sound as if that is exactly what the provision is trying to do. For example, the grounds that the Minister gave include a lack of competence, an infringement of an essential procedural requirement or a misuse of powers.

If an applicant brought before a UK court after exit day an application in relation to a piece of EU law that had been completely transferred—not an application pending in the way that is described here, but rather one that only started after exit day—and the removal of the purview of the CJEU had taken effect, and the application related, for example, to a breach of the rules of natural justice, which a court would certainly wish to entertain, or to a Minister misinforming himself as to his powers, including on an EU law that had been transferred to the UK statute book and had not been challenged hitherto, or in relation to any infringement of procedural requirements, which I suppose would include the rules of natural justice, what would be the Government’s attitude to such an application? Are the Government trying to say that the courts could not entertain such an application? I hope not, and the Minister is shaking his head.

Secondly and finally, if there were a case where a court found itself saying, “This is an instance where we would recognise the validity of the applicant’s claims if we could, but thanks to this regulation we can’t, so we won’t”, what would then be the Government’s policy?

[Vernon Coaker]

I think I agree with the hon. Gentleman regarding the questions that he has just asked.

I will say this again, and I say it in every SI Committee that I am on: there are numerous SIs that pass into law that have huge implications and people come to our surgeries and say, “When did this happen?” It usually turns out that it was under some SI, rather than a piece of legislation discussed in the main Chamber.

I am not a lawyer, but I will pick up on one or two things that the hon. Member for South Norfolk asked about. The Minister may say, “I have already answered this”, but for the benefit of those who might read these proceedings and non-lawyers, it would be helpful for us to understand better.

I take the point that the Minister made, when he very helpfully read out the court case numbers, which I failed to write down; I did write down the topics. But this is the point: those cases will be dealt with, because they have already begun. I understand that, because these cases were already entered into by the courts beforehand, so there will be an opportunity for our courts to make a judgment on them after exit day—should that happen.

I have no idea what challenges there are around therapeutic bandages or artificial body parts or anti-dumping duties on footwear from China, but I would hesitate to say that these issues are irrelevant or of no consequence, partly because in numerous SI Committees seemingly impenetrable things happen and impenetrable regulations are passed, and then sooner or later somebody comes to one of our surgeries and says, “You’ll never guess what: I have a footwear business and I do a lot of trade with China, and something has happened so that it’s been declared invalid and I can’t now do it.” I have no idea. I am not saying it is wrong or right; I just do not know.

However, I have a couple of questions and it would be helpful if the Minister could answer them. I ask the Minister’s pardon if this is obvious, but it is not obvious to me: is this a no-deal SI, or is it just an SI that is passed whatever the consequence or outcome, whether we leave with a deal or no deal? Is this in lieu of a no-deal Brexit?

Normally, under our constitution, the courts can interpret the law, but as I understand it this measure will allow the courts to strike a law down. So what part of our constitution is the Minister saying allows us to strike down a law? Can he more properly explain the operation of retained European law after exit? I thought it was just, “This is the law, these are the laws we don’t want, these are the laws we do want, so they become part of our law—full stop.” Now, if I am not a lawyer, somebody needs to explain what “retained” means, because what I have just said is what I would have assumed it meant.

[Mr Bacon]

That is my understanding as well—that retained EU law simply becomes part of domestic law. My questions to the Minister were around the case of something that—in these terms and for these purposes now, after exit day—would no longer be termed in retained EU law but simply for these purposes domestic law, and whether, as this purports to suggest, it would oust the ability of an applicant to get a court to entertain whether this was in breach, or whether the powers that the Minister was using, or purporting to use, under that—for these purposes—domestic law were wrong and invalid, and the Minister was acting inappropriately.

[Vernon Coaker]

I agree with that. It is very well put and is a question for the Minister to answer, because it goes to the heart of what we are asking.

My final point in this brief contribution is important. What happens if the CJEU—I need to be careful here or I will confuse myself—finds a pre-exit provision of EU law to be invalid? It will cease to be EU law, but will it continue here? The CJEU will have found an existing piece of EU law, which, presumably, we have retained, invalid, so it will not operate in the rest of Europe, but, because it is retained, we will not have the opportunity—or will we?—to strike it down. Or will it simply continue here, even though it has been struck down in the rest of the EU, if the Minister understands me?

--- Later in debate ---

[Chris Heaton-Harris]

I thank the various members of the Committee and the shadow spokesman for their points, questions and contributions. I attempted in my opening speech to be relatively brief. Unfortunately, some of the questions raised are relatively complicated, so I am afraid my concluding remarks might take slightly longer.

I will go through some of the points raised. To give an example, one case that I mentioned was partially successful, and I should go into more detail so that people can understand exactly what sorts of case have been subject to validity changes in the past. The one that was partially successful was a tax case submitted by the first-tier tax tribunal. The case concerned the validity of regulations imposing anti-dumping duties on shoes containing specific leather parts. The hon. Member for Gedling is completely correct: such cases are very particular to certain Members of Parliament. I come from Northamptonshire. Shoe manufacturing is a big deal in my part of the world and the case was a big local news story at the time. The CJEU found that, although parts of the regulations were invalid, the parts imposing the anti-dumping duties were still valid, which is why the ruling was partial.

The claimant in the case, Clarks the shoemaker, a manufacturer, claimed that the EU had committed an infringement of an essential procurement requirement on the basis that the Commission had not adjudicated upon claims for market economy treatment and individual treatment by certain Chinese and Vietnamese exporting producers. The claimant argued, therefore, that the regulations imposing anti-dumping duties on specific footwear containing uppers—which, as members of the Committee will know, are the parts of the shoe that cover the toes, the top of the foot, the sides of the foot and the back of the heel—made from leather, and originating from Vietnam, China and Macao, were invalid.

The CJEU found that two EU regulations were partially invalid, but that specific requirements of regulations imposing the anti-dumping duties were still valid. In other words, the hon. Gentleman is quite correct. Although it is easy to brush over the effects of the judgments in a couple of sentences in Committee, they are quite significant judgments for big manufacturing companies across our constituencies. He and my hon. Friend the Member for South Norfolk were right to raise the questions that they did.

The first question is, does the measure reduce access to justice in certain ways? No, it does not. It allows cases begun before exit to continue largely as at present. Without regulations, it would not be possible to continue a validity challenge begun before exit. The decision that it will not be possible to challenge the law on the basis of validity after exit was taken and voted upon by Parliament when the EU withdrawal Act passed.

Another question was, what will happen if the CJEU rules after exit that EU legislation was invalidly made? Will that invalid legislation remain on the UK statute book? The answer is yes—decisions by the CJEU will not affect retained European law. The hon. Member for Gedling asked what EU retained law is. It is a snapshot of all European law taken the day we leave the European Union. It is being done by the National Archives, and will be accessible to every person in this country. I have been to visit the programme that is doing this. I promise the Committee that not only is it on budget, on time and able to do its job; it is ready to go now. There will therefore be a body of retained EU law that people can interrogate from their homes, should they wish to do so.

Even if the CJEU decides to void legislation after exit day, that law will remain on the UK statute book as retained EU law, because the European Union (Withdrawal) Act will take a snapshot of EU law as it stands on exit day, and all law on the UK statute book at that time will be valid as a result of its being made law under the Act. After exit, it will be for Parliament to decide whether and how to diverge from EU law, or indeed perhaps to take note of what might have happened at the CJEU, and to take action that flows from that.

Another question—raised, I think, by the hon. Member for Sheffield Central—was, why do the regulations not go further and include provision for future rulings of the CJEU to be taken into account, or provision for there to be consideration of future rulings? The decision to extinguish validity challenges domestically is coherent with the Government’s intention to re-establish UK parliamentary supremacy over UK law after exit. After exit day, it should and will be for Parliament to decide how, when and whether the UK should modify retained EU law.

[Mr Bacon]

The Minister is being very clear and has, to some extent, put my mind at rest. I have no issue with the idea that our domestic courts cannot challenge the validity of EU retained law—for these purposes, domestic law. In any case, an ability on their part to do that would seem to me to be a dodgy and suspicious foreign import to English jurisprudence, so I have no problem with that at all. I suppose what I am really trying to get at is simply whether I am correct in supposing that the SI does not purport in any way to limit at all the ambit of the judicial review of administrative action of any law, including the law to be imported as EU retained law into domestic law.

[Chris Heaton-Harris]

I can absolutely give my hon. Friend that assurance.

Returning to why the regulations do not go further, the statutory instrument could not act in contradiction to the explicit intention of the withdrawal Act. It could not, for example, make provisions so that UK judges followed validity rulings of the CJEU, or so that future rulings of the CJEU on validity would mean that retained EU law was invalid.

I hope that I have answered a couple of the questions. I am wary in that I might not have tackled everybody’s questions, so, as I begin to conclude, if I have missed anybody I would very much appreciate it if they let me know. My hon. Friend the Member for South Norfolk talked about an ouster clause. We have copied the CJEU grounds, and cannot currently challenge validity for any other reason. I hope that he is now completely satisfied on those grounds.

The regulations aim to ensure the effective continued delivery of justice as we leave the European Union. As such, they are an important part of the Government’s preparations for the UK’s withdrawal from the European Union. As such, I commend them to the Committee.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Challenges to Validity of EU Instruments (EU Exit) Regulations 2019.