Guides & Advice

UK Government consults on lower courts’ powers to depart from retained EU case law

Published: 10th August 2020
Area: Litigation & Dispute Resolution

UK Government consults on lower courts’ powers to depart from retained EU case law

The Ministry of Justice is currently consulting on whether the lower UK courts should be given powers to depart from retained EU case law after the end of the UK’s transition period after Brexit on 31 December 2020.

The consultation is running until 13 August 2020 with members of the judiciary, legal partners and stakeholders, and devolved administrations of Scotland, Northern Ireland and Wales having been called upon to give their views on the UK Government’s proposals.

Why has the UK Government issued the consultation?

After the end of the transition period, the UK will no longer be bound by future decisions of the Court of Justice of the European Union.

Currently, only the highest courts in the UK (the Supreme Court and the Higher Court of Justiciary in Scotland) have powers to depart from retained EU case law.

However, under the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020), the UK Government has until 31 December 2020 to introduce regulations that could give lower courts and tribunals the powers to depart from retained EU case law, and outline the extent to which they can do so.

What is UK Government proposing?

The UK Government proposes two options, namely that the powers to depart from retained EU case law could be extended to: -

1. The Court of Appeal of England and Wales and its closest equivalents in Northern Ireland and Scotland; or

2. In addition to the Court of Appeal and the other courts specified in option one, the High Court in England and Wales and its closest equivalents in Northern Ireland and Scotland.

What is the UK Government hoping to achieve?

The UK Government considers that the lower courts’ powers to diverge from retained EU case law is necessary in the same way that courts and tribunals can currently depart from their own case law to prevent the law becoming “fossilised”.   The UK Government believes the proposals will enable litigants the "sufficient ability to seek a change to retained EU case law where it adversely affects them.”

The Government says it recognises the need to provide legal clarity and certainty, yet also considers it is important that UK courts are not bound by retained EU case law “for longer than is appropriate”.  The Government considers its proposals balance the need for legal clarity with the need for the law to reflect the UK’s changing needs following our departure from the EU.

Will the proposals achieve the UK Government’s desired outcome?

Whilst the UK Government’s aim is to create certainty and flexibility, there are concerns that its proposals will have the counter effect.

With different courts applying different tests across the UK, this could create "disparate considerations and judgments" and uncertainty for appeal courts when considering whether or not a decision to depart from retained EU case law was correct.

Further, if the lower courts are given powers to depart from retained EU case law then there runs a risk of divergence between UK jurisdictions, and the emergence of "forum shopping" could become a real possibility for litigants.

In its preliminary view, the Government aims to alleviate these risks by proposing that the ability to depart from retained EU case law should be limited to senior courts.  The views of various stakeholders will be concerned as to whether this will be enough.

What these changes may mean for your business

If the Government’s proposals are welcomed, and if regulations are implemented to give the lower UK courts jurisdiction to depart from retained EU case law, a level of legal uncertainty after the transition period will undoubtedly ensue.

Notwithstanding that, the proposals could also be your window of opportunity if you have been adversely impacted by retained EU case law and wish to challenge this.  The proposed regulations may be your long-awaited incentive to re-litigate and seek relief of issues that are covered by retained EU case law, such as scope of VAT or paid leave entitlement.

You can view the full consultation proposals here.

Contact us

If you’d like to discuss these proposals further, or need some guidance and advice on how they may affect your specific circumstances, please speak to a member of your local corporate restructuring and insolvency team.

We are following the developments of the consultation closely; the Ministry of Justice intends to provide a full response to the consultation in the coming months, at which point we will provide a further update.

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