In its final form, the Act did not create the “bonfire” of EU-derived legislation that was originally envisaged. Nonetheless, this remains an important piece of legislation, which has the potential to open the door to significant legal change in a wide range of policy areas.

As discussed in greater detail below, the Act gives ministers wide-ranging powers to amend and replace EU-derived legislation and the courts are given greater freedom to depart from retained case law. The overall effect is to create a degree of uncertainty because it is not yet known how ministers will exercise the powers conferred by the Act or how courts will apply the new test for departing from retained case law.

Sunset provision reduced in scope

As is well known, the Act originally contained a very broad sunset provision, which provided for most EU-derived subordinate legislation and retained direct EU legislation to be revoked at the end of 2023 (unless it was expressly carved out or preserved). This led to concerns that legislation could be revoked without proper consideration of the consequences or replacement legislation being put in place.

During the passage of the Act through Parliament, however, this sunset provision was replaced by a new section 1 of the Act, which revokes only the EU-derived legislation that is specifically identified in Schedule 1 to the Act. Much of the legislation included in Schedule 1 is in effect already redundant and the impact of the Act is in this respect considerably less than it would have been if the sunset provision had been retained in its original form.

Changes effective at the end of 2023

Whilst the above change has reduced the controversy surrounding the Act, it nevertheless makes some important changes. In particular, it removes the following features of EU law from the UK statute book at the end of 2023.

• The Act repeals section 4 of the European Union (Withdrawal) Act 2018 (EUWA 2018), which preserved, for example, directly effective rights derived from EU treaties and directives. Although this sunset provision has attracted less attention, it raises similar concerns to the one described above (in its original form) in that there is no definitive list of the rights that will be revoked.
• The principle of the supremacy of EU law (which currently still applies in a limited form in UK law) will be abolished. Courts will be required to interpret retained direct EU legislation in a way that is compatible with domestic enactments and, where this is not possible, to give preference to domestic enactments. Broadly, this reverses the current position. Section 7 of the Act gives ministers the power to replicate the effect of supremacy but only between specific domestic enactments and specific pieces of retained direct EU legislation. 
• The general principles of EU law (such as the principles of effectiveness, fundamental rights and non-discrimination) will be abolished (although there will be scope for dispute as to whether some of these principles otherwise form part of English domestic law).
• Retained EU law will become known as “assimilated law” (although, for ease of reference, this note refers to “retained EU law” throughout). 

The change in name produces no substantive effect in itself. However, the other changes are significant because they alter the basis on which legislation has previously been interpreted. This, combined with the new test for departing from retained case law (see below), could require courts to revisit the way in which EU-derived legislation has been interpreted in past cases, including in areas where the case law was previously considered settled. Cases which were decided by reference to the general principles or directly effective rights, or on the basis that EU law took preference over domestic law, will presumably be particularly susceptible to challenge.

Retained case law

The starting point under EUWA 2018 was that decisions handed down by the Court of Justice of the European Union (CJEU) before 31 December 2020 continued to be binding on English courts. The Supreme Court could depart from such decisions where it appeared “right to do so”. This ability was subsequently extended to the Court of Appeal (and other equivalent courts).

The Act introduces new tests, which give the Supreme Court and Court of Appeal greater freedom to depart from CJEU decisions and from those courts’ own previous decisions on retained EU law. The tests are slightly different depending on whether a relevant court is considering a judgment of the CJEU or its own previous judgment. But, on any footing, the tests are less restrictive than the previous one and could be seen as encouraging appellate courts to depart from retained EU case law. For example, the test for whether to depart from a CJEU decision includes the requirement that the appellate court should have regard to “the fact that decisions of a foreign court are not (unless otherwise provided) binding”.

The Act also introduces a new mechanism for first-instance courts and tribunals (such as the High Court of England and Wales) to refer points of retained case law to the appellate courts, which will then rule on whether the retained case law should be followed (using the new tests discussed above). The case will then return to the lower court to decide the dispute, applying the higher court’s finding on retained case law.

If no such reference is made, law officers (senior legal advisers to the UK Government and devolved administrations) can make a similar reference up to six months after proceedings have concluded. The outcome of the reference will not affect the proceedings themselves but will be binding in future cases. Law officers are also entitled to intervene in proceedings where an appellate court is considering whether to depart from retained EU case law.

Powers to modify retained EU law

The Act gives ministers wide powers (with limited Parliamentary scrutiny) to amend, restate, revoke, replace and update EU derived legislation. Perhaps the most striking example of these powers is found in clause 14 of the Act, which enables ministers or devolved authorities to revoke any secondary retained EU law and (clause 14(2)) to “replace it with such provision as the relevant national authority considers to be appropriate and to achieve the same or similar objectives” or (clause 14(3)) to “make such alternative provision as the relevant national authority considers appropriate”. When the Act was first introduced to Parliament, one commentator described this as a “do anything we want power”.

These are, on any footing, very wide powers. Several attempts were made by the House of Lords to impose limits on them but their proposed amendments were in each case rejected by the House of Commons. In the House of Lords, the Government gave certain commitments about how they would use these powers. For example, the Government said that it would “follow the usual protocols on public consultation” when using its powers under section 14 to make “significant reforms”. Beyond this, however, there is very little guidance as to how the Government intends to exercise these powers, which remain in place until June 2026.

Comment

The immediate impact of the Act is less than it would have been if the original section 1 sunset provision had been retained and there will not be a sudden and dramatic change in the law on 1 January 2024. However, if the Government wishes to make significant changes in the future, it has given itself the powers to do so. Furthermore, the Act creates doubts over the status over the corpus of EU-derived case law that has been built up over the past 50 years and it creates an incentive to litigate about issues that had previously been considered settled.