Update on UK-EU Relationship

Revocation of EU Law

Following the Government agreeing to amend the Retained EU Law (Revocation and Reform) Bill, such that it will now repeal specific pieces of EU legislation, rather than all retained EU law as previously envisioned, the Bill has finally received Royal Assent, becoming the Retained EU Law (Revocation and Reform) Act.

The Lords begrudgingly passed the Bill despite concerns, after their proposed amendments regarding environmental protection and parliamentary scrutiny of statutory instruments were rejected by the Commons. Lord Krebs, who tabled several unsuccessful amendments, voiced his dissatisfaction with the debate, comparing it to the train journey from Oxford to London, saying “The journey takes longer than you would have wished and you do not end up at the destination that you had hoped to at the end”.

The Financial Services and Markets Bill has also received Royal Assent, becoming the Financial Services and Markets Act (FSMA 2023). FSMA 2023 sets out new provisions regarding the regulation of financial services and markets, departing from some of the relevant EU law that governed this area and establishing a post-Brexit regulatory regime.

Illegal Migration Bill

The Illegal Migration Bill, which seeks to deter individuals from entering the UK unlawfully, has faced significant opposition in both the Lords and more broadly. The Lords defeated the Government during its consideration of the Bill several times, including, crucially, by removing clause 1(5) of the Bill, which would have enabled the Government to disapply section 3 of the Human Rights Act when exercising powers under the Bill. Section 3 of the Human Rights Act requires legislation to be read and given effect in a way which is compatible with the European Convention on Human Rights, so far as possible.

The Joint Committee on Human Rights has published a report on the Illegal Migration Bill, stating that some of its provisions are incompatible with the UK’s legal obligations under international law, including under the European Convention on Human Rights. The Joint Committee said the Bill would “deny the vast majority of refugees access to the UK’s asylum system, despite the fact that there will have been, in many cases, no means for them to enter the UK by safe and legal routes”. They also found issue with clause 1(5), arguing that section 3 of the Human Rights Act is crucial to the protection of human rights in the UK, and finding that a clause which could allow for section 3 to be disapplied would undermine the principle that human rights are universal. This issue has now been addressed by the Lords, as mentioned above.

The Foreign Affairs and International Trade Committees of the European Parliament have also voiced their concerns regarding both the Retained EU Law (Revocation and Reform) Act and the Illegal Migration Bill. They believe that the former could “bring about a number of negative consequences that could lead to uncertainty for businesses and stakeholders on both sides of the Channel and would undermine workers’ rights in the UK”, and that the latter might result in divergence from the European Convention on Human Rights, which could, under the terms of the Trade and Cooperation Agreement, necessitate the termination of law enforcement cooperation between the UK and EU.

You can read more about the Illegal Migration Bill in our March update, here.

Gibraltar

As part of ongoing negotiations between the UK and EU over the status of Gibraltar, which was left out of the Trade and Cooperation Agreement, the European Scrutiny Committee took evidence from Fabian Picardo, Chief Minister of Gibraltar. The stated aim of both parties to negotiations is to maintain freedom of movement across the border, particularly regarding the thousands of workers who travel from Spain to Gibraltar each day for work.

These workers are obviously crucial for Gibraltar’s economy and make up a particularly large portion of the British Overseas Territory’s health service and tourism industry. However, an end to freedom of movement could also be disastrous for the neighbouring Spanish region, La Linea, as an inability to easily cross the border to Gibraltar could cause unemployment to skyrocket and make the area a far less desirable place to live.

Mr Picardo was optimistic that a deal could be reached, describing the two sides as being within “kissing distance of a treaty”. However, he firmly stated that the question of Gibraltar’s sovereignty was not on the table, and that Gibraltar would not cede “one iota of our sovereignty”.

Mr Picardo’s comments are a response to some of the more right-wing rhetoric coming out of Spain in recent years, where Gibraltar has been described as “the last colony in Europe” – the far-right Vox party has been particularly clear about its intentions to “reunite” Spain. The incumbent socialist government, led by the PSOE, has been more willing to engage in amicable negotiation over Gibraltar, but there had been fears that Spain’s recent elections would see the PSOE turfed out and replaced by a coalition between the right-wing People’s Party and Vox – a coalition which would undoubtedly take a much more hard-line stance.

Mr Picardo was very clear regarding his views on Vox and the idea of a Spanish Gibraltar: “Vox can say what they like about Gibraltar. I can say Galicia is French, but that does not make Galicia French… Gibraltar is not Spanish. Gibraltar has probably not ever been Spanish, because the Spain that held Gibraltar is not the Spain that you have today; it was Castile and all the rest of it. And Gibraltar is never going to be Spanish. That is the reality.”

However, following the shock outcome of the election, resulting in a hung parliament under which the PSOE look most likely to form a new government, there is still hope that negotiations can continue without Spanish revanchism, making a workable outcome far more probable.

Imports and Exports

Lord Benyon, a Minister for the Department of Environment, Food & Rural Affairs, answered questions earlier this month on the Government’s plans to reduce trade barriers to food imports from the EU. The Government intends not to introduce a formal sanitary and phytosanitary (SPS) agreement with the EU, meaning that agricultural food imports from the EU will be subject to strict checks aimed at preventing the spread of disease. During questions, Lord Hannay asked why the Government intended not to have an SPS agreement in place, despite other countries, including Switzerland and New Zealand, having such an agreement, enabling cheaper and speedier food imports from the EU. Lord Benyon reasserted the importance of maintaining these checks and flagged that “the cost of getting it wrong is really quite horrific”, pointing to African swine flu, which has spread to parts of Europe, as an example. “I want Ministers facilitating trade”, he said, “not sitting in COBRA trying to deal with a disaster”.

Meanwhile, Kevin Hollinrake, Minister for Business and Trade, has reported that the value of UK exports to EU, accounting for inflation, has increased from £298 billion in 2016 to £340 billion in 2022. Conservative MP Philip Hollobone described these figures as “very interesting”, given that they contrast most economist’s predictions regarding the impact on UK exports of leaving the EU.

Key dates

• Late 2023: new requirements for Export Health Certificates for EU imports into Great Britain are subject to further delay – a new date will be confirmed.
• Late 2023: Phytosanitary Certificates and physical checks on most remaining SPS goods (such as meat and plants) at Great British border are subject to further delay – a new date will be confirmed.
• Late 2023: Safety and Security declaration requirements on EU imports into Great Britain are subject to further delay – a new date will be confirmed.
• December 2023: current “sunset” date in the Retained EU Law (Revocation and Reform) Act, at which point the special status of EU legislation in UK domestic law will end.
• 31 December 2025: end of grace period for facilitating entry of veterinary medicines from Great Britain into Northern Ireland.