Sunday 13 August 2017

EU (Withdrawal) Bill ~ It will be goodbye to Francovich

Francovich 1991
This post continues my look at the European Union (Withdrawal) Bill  with a particular focus on Schedule 1 to the Bill which is entitled "Further provision about exceptions to savings and incorporation."   Legal effect is given to the Schedule by Clause 5(6)

Explanatory Notes are available - HERE.  Previous posts considering aspects of the Bill are OVERVIEW , ECA Repeal and Exit Day , Retention of Existing EU Law and Clause 6 - Interpretation.

Schedule 1 makes frequent appearances in the Bill - see Clause 2(3), Clause 3(5), Clause 4(3).  The wording, on each occasion, is - "This section is subject to section 5 and Schedule 1 (exceptions to savings and incorporation).  Tucked away in this Schedule are some very important matters:

A] Challenges to the validity of retained EU law:

The EU Treaties permit challenges to the validity of EU legislation to be brought in the CJEU.  A recent example concerned the Tobacco Products Directive - Directive 2014/40/EU.  In May 2016, the CJEU rejected various challenges to the directive - HERE.

Schedule 1 paragraph 1 is concerned with preventing challenges to retained EU law being brought in domestic law - "There is no right in domestic law on or after exit day to challenge any retained EU law on the basis that, immediately before exit day, an EU instrument was invalid."  However, a challenge may be possible if (a) the European Court has decided before exit day that the instrument is invalid, or (b) the challenge is of a kind described, or provided for, in regulations made by a Minister of the Crown. Such Regulations may (among other things) provide for a challenge which would otherwise have been against an EU institution to be against a public authority in the United Kingdom.

B] General Principles of EU Law:

Schedule 1 paragraph 2 and 3 are concerned with General principles of EU law and state that - "No general principle of EU law is part of domestic law on or after exit day if it was not recognised as a general principle of EU law by the European Court in a case decided before exit day (whether or not as an essential part of the decision in the case). 

There will be no right of action in domestic law on or after exit day  based on a failure to comply with any of the general principles of EU law. 

No court or tribunal or other public authority may, on or after exit day - (a) disapply or quash any enactment or other rule of law, or (b) quash any conduct or otherwise decide that it is unlawful, because it is incompatible with any of the general principles of EU law.

C] Francovich:

Schedule 1 paragraph 4 -There is no right in domestic law on or after exit day to damages in accordance with the rule in Francovich

This refers to the decision of the European Court of Justice in Francovich and Bonifaci v Italy (1991) where Italy failed to implement Directive 80/987/EEC by the required implementation date.  The Directive sought to give compensation  to workers who suffered damage when their employers became insolvent.  Italy was held to be in breach of its Treaty obligations and was under a duty to compensate individuals for damage suffered as a result of the failure to implement.  The court laid down certain conditions for this to apply but these need not concern us further here. 

An example of a Francovich claim failing is Carswell v Secretary of State for Transport [2010] EWHC 3230.  Another example is the Recall Support Services [2014] EWCA Civ 1370.  However, a claimant succeeded in Delaney v Secretary of State for Transport [2015] EWCA Civ 172 - a decision about which the Mail Online (9th March 2015) commented in (unusually) quite moderate terms.

There have been calls for a right to sue for damages to be preserved - HERE

The Explanatory Notes - HERE - say that - "Paragraph 4 provides that the right to claim damages against the state for breaches of EU law (Francovich damages) will not be available after exit. This provision does not affect any specific statutory rights to claim damages in respect of breaches of retained EU law (for example, under the Public Contracts Regulations 2015 ) or the case law which applies to the interpretation of any such provisions.

D] Interpretation:

Paragraph 5 clarifies that references in clause 5 and Schedule 1 to the principle of supremacy of EU law, the Charter of Fundamental Rights, any general principle of EU law or the rule in Francovich are to be read as references to that principle, Charter or rule as they stand at exit day, not as they will operate in EU law in the future. 

This is another example of why the state of EU law - as it stands at Exit Day - will be so important. 

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