Retained EU law: what's changed and why does it still matter?

From 1 January 2024, retained EU law has a new name ("assimilated law") and different rules apply when interpreting it. We explain why this matters and what the impact on business is likely to be. We've also included a glossary of relevant terminology, together with a timeline highlighting key dates in the development of retained EU law.

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Why does retained EU law still matter and what's changed from 1 January 2024?

In June 2023, Parliament passed the Retained EU Law (Revocation and Reform) Act 2023 (the REUL Act). At the time, much attention focussed on provisions which, as originally drafted, would have repealed vast swathes of EU-derived measures which had been retained by the UK following the end of the Brexit transition period. However, in the final version of the legislation, the UK Government opted for a list of just over 600 EU-derived measures which were revoked at the end of 2023. Around 100 further measures were revoked at the same time by a separate statutory instrument, issued after the Act was passed. Our view is that this will have limited impact in practice, as many of the measures revoked were already effectively redundant (although in the environmental field, there was some surprise at a number of the measures listed for revocation).

According to the Government's own figures, this still leaves well over 4000 EU-derived measures on the UK's statute book – which underlines how this body of law is likely to remain an important element of the UK's legal framework for some time to come. This is why retained EU law still matters – and it's also why a number of the other changes made by the REUL Act are potentially significant.

Other key changes in the REUL Act

Less attention was paid to the impact of the REUL Act in other areas, notably the following (which came into force from 1 January 2024):

Changes to the interpretation of retained EU law and the removal of directly effective rights - discussed in section 2; and
New terminology - discussed in section 3

The REUL Act also aims to encourage more departures from retained EU case law, using a variety of measures including providing more opportunities for courts to rule on whether to depart and altering the test for when divergence is appropriate. However, at the time of writing (March 2024), these provisions were not yet in force.

Finally, section 4 provides a timeline of retained EU law, which also serves to highlight some of the complexities that have arisen in the process of adapting EU-derived laws to work on the UK statute book, outside the EU framework.

New rules on interpretation and removal of directly effective rights

Now that most provisions of the REUL Act are in force, EU-derived measures on the UK's statute book may in some cases be interpreted and applied differently. There are a number of reasons for this:

Removal of key interpretative principles: The REUL Act removes key EU law principles which are often important when interpreting retained EU law. These include the principle of supremacy of EU law and other general principles of EU, such as proportionality. UK principles of statutory interpretation are to be applied instead, which may produce different outcomes - but see the discussion below under "What's the impact?" about the role of pre-2021 caselaw in helping to provide some degree of certainty and continuity.
New rules on conflicts with domestic legislation: Where the relevant measure is derived from an EU Regulation (as in the case of the UK's current data protection regime, which is based on the EU GDPR), the REUL Act provides that domestic legislation will take precedence if there is any conflict. This reverses the current position, where the relevant EU-derived legislation would override any conflicting domestic measures.
Removal of directly effective EU rights: The REUL Act also removes all directly effective EU rights, including the concept of direct effect of EU Directives.

What's the impact?

The changes made by the REUL Act arguably undermine one of the key aims of the European Union (Withdrawal) Act 2018, which was to give businesses certainty that after the end of the Brexit transition period, the majority of EU-derived law on the UK's statute book would continue to operate in the same way as before. However, the following points should be noted:

First, as a general rule, pre-2021 caselaw on EU law issues continues to be binding on most UK courts. Where a pre-2021 case has already established that an EU-derived measure means X, it is likely to be more difficult to argue that, as a result of the REUL Act, the measure should now be interpreted as meaning Y instead. However, it would appear that pre-2021 cases on the direct effect of Directives can no longer be relied upon – so in these instances, the meaning of the relevant EU-derived measure is likely to change. It is also unclear how far pre-2021 cases involving the supremacy principle or other general principles of EU law continue to be binding.
Second, whilst the removal of direct effect of Directives may, at first sight, sound somewhat alarming (because it is likely to force courts to interpret UK legislation implementing certain Directives in a different way), it should be borne in mind that this right was only enforceable against "emanations of the state"; it could not be relied upon in disputes between private parties. It follows that its loss is likely to be felt primarily in scenarios where private parties would prefer Government, a public body or a regulator to act (or refrain from acting) in a particular way, based on how UK legislation implementing a Directive has been interpreted prior to 2024.
Third, there are a number of areas where the Government has acted to negate the impact of the REUL Act, effectively preserving the status quo. For example, it has legislated to preserve the effect of certain EU-derived rights in the pensions sphere and to reproduce the effects of Article 157 on the right to equal pay for equal work between men and women.
Fourth, whilst uncertainty is rarely desirable, businesses should not assume that a change in interpretation will necessarily always be adverse to their interests; in some areas, it could result in a less stringent application of EU-derived regulation, which many businesses might welcome.

Given all these points, our view is that the overall impact of the interpretative provisions of the REUL Act is likely to be fairly localised and should not be overstated. That said, in those areas where they do actually "bite", they have the potential to result in some quite significant interpretative changes, depending how the courts apply the new rules in practice. Exactly which areas will be affected is difficult to predict, but some indication of the breadth of areas covered by retained EU law is given by our earlier briefing from shortly after the REUL Act was passed.

Retained EU law: new terminology

The REUL Act also introduces new terminology, replacing the term "retained EU law" with "assimilated law" in legislation governing the UK's post-Brexit legal framework for EU-derived measures. The following glossary of terms may help to reduce the scope for confusion from this change:

What's the impact?

If you are referring to EU-derived law in a formal document, such as a contract or pleadings in litigation, you should use the new terminology. However, as a general rule, it should not be necessary to go back through pre-2024 contracts and update the terminology; the courts will normally have regard to what the parties intended at the time of contracting, when the correct term was still retained EU law. Even if you have referred to retained EU law in a post-2024 contract, it is likely in most cases that the courts will assume that you meant "assimilated law" (as it is difficult to see what other meaning the contract will have).

Retained EU law timeline

The timeline below illustrates some of the complexities which have arisen as a result of Brexit and its aftermath. For example, let's say you are looking at a dispute where the fact pattern starts before 2021 and continues through to the present day 2024. In such a case, you may well have to consider:

The pre-2021 position, when EU law was still applicable in the UK;
The post-2021 position when most EU law ceased to apply in the UK but the relevant EU measure may well have been retained on the UK statute book; and
The position from 2024 onwards, since it may have been altered by the REUL Act.

26 June 2018

European Union (Withdrawal) Act 2018 (EUWA) receives Royal Assent, creating legal framework for post-exit retention of EU-derived law in the UK. However, EU law continues to apply in the UK (pending the UK's exit). Government starts process of legislating to amend EU-derived law from the point of UK's exit.
17 October 2019

Withdrawal Agreement concluded between EU and UK.
1 February 2020

Withdrawal Agreement enters into force. UK officially ceased to be part of EU at 11 pm on 31 January 2020, but no immediate substantive change because UK continues to be subject to EU law (and treated as if it were a Member State) until end of Brexit transition period on 31 December 2020.
31 December 2020

End of Brexit transition period at 11 pm UK time. EU law ceases to apply except as set out in EUWA and Withdrawal Agreement. UK concept of retained EU law "goes live".
31 December 2022

3 year limitation for bringing proceedings seeking "Francovich damages" pre-2021 breaches of EU law expires.
31 December 2023

3 year limitation for bringing proceedings based on pre-2021 breaches of general principles of EU law expires.
29 June 2023

Retained EU Law (Revocation and Reform) Act 2023 (REUL Act) receives Royal Assent, making significant changes to EUWA. Government starts process of legislating to preserve the effect of certain EU-derived measures which would otherwise fall away or have to be interpreted differently from 1 January 2024 onwards.
31 December 2023

Revocation of 600+ EU-derived measures as a result of REUL Act.
1 January 2024

Changes set out in REUL Act to interpretation of EU-derived law in the UK take effect.

How we can help

Retained EU law (or "assimilated law") is now a feature of the UK legal landscape and is likely to remain important for some time to come. As indicated above, it is not straightforward and the REUL Act has arguably made the analysis even more complicated. We can help you navigate these complexities to achieve your commercial objectives, with advice which is always tailored, practical and jargon-free.

See also our detailed guide, "Retained EU law: 10 key questions", which has been fully updated to reflect the changes made by the REUL Act.

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