The EU (Withdrawal Agreement) Act: what does it do?

On 23 January 2020, the European Union (Withdrawal Agreement) Bill completed its passage through both Houses of Parliament and received Royal Assent. We look at what it does – and whether it means that Brexit is finally "done".

What does the legislation do?

In short, the European Union (Withdrawal Agreement) Act 2020 ("WAA"):

provides for the ratification of the Withdrawal Agreement on the UK side and paves the way for the UK to leave the EU on 31 January 2020, once the Withdrawal Agreement has been ratified by the EU (and signed by the parties)
gives effect to the transition period, which (unless extended) is due to expire on 31 December 2020. During this time, the UK will remain part of the EU Customs Union and Single Market and the vast majority of EU laws and judgments will continue to apply, despite the UK ceasing to be an EU Member post 31 January 2020.

But the WAA does not mean that Brexit is "done", as the UK still needs to negotiate the terms of its future relationship with the EU. The WAA also allows for some potentially significant changes to the way that the courts will approach EU case law after Brexit (which are discussed further below).

What happens next?

The European Parliament needs to approve the Withdrawal Agreement, which is expected to occur on 29 January 2020. The Council of the EU will then need to take a formal decision to give its approval to the Withdrawal Agreement, which also needs to be signed by the parties. The UK will leave the EU at 11 pm UK time on 31 January 2020. However, as noted above, the transition period means that relatively little will change immediately.

The next stage is for negotiations on the future UK-EU relationship to begin. These are not expected to start until March and the EU does not think that it will be possible to agree an ambitious, comprehensive deal before the end of the transition period on 31 December 2020. The Withdrawal Agreement provides for an extension of the transition period, but this must be agreed by 1 July 2020. The UK Government has stated that it will not seek an extension and the WAA contains provisions which would make it unlawful for the UK to do so (although Parliamentary sovereignty means that if the Government wished to overturn that prohibition, it could easily do so).

FAQs on the WAA

What happened to the legislation in the House of Lords?

The House of Lords made five amendments to the Bill but these were all rejected by MPs when the Bill returned to the House of Commons on 22 January 2020. These were:

automatic right to stay in the UK for EU citizens
power of ministers to set aside judgments by the Court of Justice of the EU (CJEU) using secondary legislation
power of UK Courts (including the lower courts instead of the Supreme Court only) to diverge from EU law and the independence of the judiciary after Brexit
guarantee for refugee children to join their relatives in the UK
Parliament to abide by the Sewel Convention which states that Parliament should not legislate on devolved issues without the consent of the Scottish Parliament, the Welsh Assembly and the Stormont Assembly in Northern Ireland.

Despite dissatisfaction with the reversals, the House of Lords voted on 22 January 2020 to allow the Bill to pass.

What does the WAA say about the ability of UK courts to depart from EU case law?

The position in the European Union (Withdrawal) Act 2018 was that pre-Brexit case law of the CJEU would be binding on the lower courts, but the Supreme Court would be able to depart from it where appropriate. For the time being, that remains the basic position but the WAA allows ministers to issue secondary legislation giving lower courts power to depart from EU case law. This approach was criticised in the House of Lords as being likely to undermine legal certainty (potentially complicating litigation by encouraging parties to raise points of law which would otherwise have been regarded as settled). However, as noted above, the Lords ultimately gave way on this point.

Ministers could adopt regulations allowing lower courts to depart from EU case law only in quite narrow circumstances and subject to fairly stringent tests – but they could equally well adopt regulations giving the courts much broader discretion. For example, the "no deal" regulations relating to UK competition law after Brexit contain provisions amending section 60 of the Competition Act 1998, which currently requires UK courts to maintain consistency with EU case law (the rationale being that the 1998 Act is closely modelled on the provisions of EU competition law and requiring businesses to comply with two differing regimes would impose extra costs). These changes would allow UK courts (not just the Supreme Court) to depart from EU case law in the competition sphere in a reasonably wide range of circumstances (the test is set out at Regulation 23(7)).

What does the WAA say about the status of all the "no deal" statutory instruments?

The Government has passed over 600 statutory instruments intended to make appropriate amendments to UK legislation in the event of a "no deal" Brexit (i.e. where the UK left the EU without the Withdrawal Agreement in place). Many of these regulations stated that they would come into force on or around "exit day" i.e. 31 January 2020. However, as it is now clear that the UK will be leaving subject to the Withdrawal Agreement and a transition period, during which EU law will largely continue to apply, the WAA provides that the start date of all these "no deal" statutory instruments is changed to the end of the transition period (currently 31 December 2020).

What does the WAA say about Parliament's role in negotiations on the future UK-EU relationship?

The October 2019 version of the legislation contained provisions giving Parliament a significant role in approving the Government's objectives for the future relationship with the EU. It would have required the Government to make those objectives public and to provide regular updates on progress. However, these provisions were removed in the revised version of the Bill tabled after the election. It therefore remains to be seen how far the new Government will continue to pursue the highly secretive approach of Theresa May's administration or whether it will choose to be more open and accountable in its approach to the negotiations (consistent with its proposed approach to trade agreements with other countries – as noted here).

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