In other cases, many changes were needed for the legislation to “work” outside the EU. For example, depending on the context, references to EU supervisors in many financial services rules derived from EU directives have been replaced by references to UK bodies such as the Financial Conduct Authority, the Prudential Regulation Authority, the Bank of England or UK ministers. This has happened, for example, in UK legislation, which originally transposed the rules introduced by the Alternative Investment Fund Managers Directive (AIFMD) and the recast Markets in Financial Instruments Directive (MiFID II). Similarly, the provisions allowing for the mutual recognition of financial service providers authorised by EU and EEA Member States and the concept of “transfer” of financial services on a cross-border basis or through the establishment of branches have been deleted (to take into account the withdrawal of the United Kingdom from the EU internal market). EU case law is important because it clarifies how EU law is to be interpreted and applied. After Brexit, the UK could theoretically have taken the position that UK courts should not be bound by EU case law when considering retained EU law and should take no account of it. However, this would have led to a situation where UK courts had to start from virtually zero to decide how to interpret or apply part of the retained EU law. Apart from the fact that this approach represents a heavy burden for UK judges, this approach would have created considerable uncertainty for the economy as to how the retained EU law would work in practice. To avoid this, Article 6 of the European Union (Withdrawal) Act 2018 provides that, as a general rule, Articles 86 and 89 of the Withdrawal Agreement provide that decisions of the CJEU on matters submitted by the UK courts before the end of the transition period are binding on the UK. It follows that it is possible that CJEU decisions issued after the end of 2020 will be binding on UK courts – but usually only if a referral has been made by a UK court before the end of 2020. After 2020, UK courts will no longer have the possibility to appeal to the CJEU. As a result, we probably won`t see a large number of CJEU decisions after 2020 that have binding status in the UK – but there will be (like this example when it comes to the EU Commercial Agents Directive).
A judgment of the Court of Appeal of March 2022, taking into account a judgment of the CJEU of June 2021, confirmed that the effect of Articles 86 and 89 is that described above (see paragraphs 13 to 22 of the judgment). In fact, the Court of Appeal appeared bound by the relevant CJEU ruling (which concerned excise duties), although it and the Supreme Court are free to depart from the CJEU`s case law before 2021 (see box above). At the end of 2019, there was a change of leadership within the Conservative Party and the new government agreed with the EU on the terms of the Withdrawal Agreement. The government decided to reconsider the extent to which the CJEU`s decisions would be binding on UK courts, fearing that if only the Supreme Court could deviate from retained EU case law, a desirable deviation from CJEU case law would be unnecessarily long in coming. This has been regulated by amendments made to § 6 of the Withdrawal Act by the European Union (Withdrawal Agreement) Act 2020. In order to avoid the possible negative consequences described above, section 3 of the European Union (Withdrawal) Act 2018 incorporated all relevant EU decisions available on 31 December 2020 at 11pm into the UK Code, thus preserving their validity in UK law. In cases where the EU decision in question was part of a legal framework, it may have been amended by a legal instrument to reflect the UK`s withdrawal from the EU (similar to EU directives and EU regulations). Where that body is required to examine the meaning of a concept of EU law, Article 174 of the Withdrawal Agreement obliges it to ask the CJEU for a binding interpretation of that concept of EU law.
The panel must then apply that interpretation to the dispute before it. The CJEU will not be involved in disputes that do not concern the concepts of EU law and will not settle on the dispute between the UK and the EU itself. EU regulations include laws such as the EU General Data Protection Regulation or the GDPR, which is the main legal instrument for the processing of personal data in the EU (see below for more examples). As with EU directives, EU regulations will no longer apply to the UK from 31 December 2020 at 11pm, except to the limited extent provided for in the Northern Ireland Protocol (see section 2 above). However, many EU regulations have been incorporated into the UK Code and then amended, in the same way as EU directives. The retained EU case law is set out in Article 6(7) of the European Union Withdrawal Act 2018 (EUWA 2018). With a few exceptions, it covers all principles and decisions of the Court of Justice of the European Union established by the Court of Justice of the European Union, which will enter into force in EU law immediately before 31 December 2020. After the date of completion of the intellectual property, changes made by the EU to EU legislation and published on EUR-Lex do not automatically apply to the UK. Instead, the UK can make its own changes to EU law, which are maintained in UK law. First, its jurisdiction over concepts of EU law arising from the interpretation and application of the VA remains in force as long as certain aspects of the VA remain in force. In the case of Part 2 of the Civil Rights Withdrawal Agreement, this is the case as long as EU citizens and UK nationals covered by Part 2 remain alive. An explanation of Part 2 of the Withdrawal Agreement can be found in the research briefing of the EU-UK Withdrawal Agreement library of October 2019.
In the case of the Protocol on Ireland and Northern Ireland, the jurisdiction of the CJEU could be unlimited. Extending the power of courts to deviate from EU case law The UK government has also legislated to allow lower courts and regulators to derogate from pre-2021 CJEU case law in the area of competition law – although they can only do so if they are satisfied that certain conditions are met (see this briefing note). It may decide to extend this approach to other areas where retained EU case law plays an important role. However, they can continue to take into account the new judgments of the CJEU as long as they are relevant to the case pending before the court. This publication is general and therefore cannot be used to cover specific situations. The application of the principles set out above depends on the circumstances and we recommend that you seek professional advice before acting or refraining from the content of this publication. Deloitte LLP is pleased to advise readers on how to apply the principles set out in this publication to their particular situation. Deloitte LLP assumes no duty of care or liability for any loss suffered by any person acting or failing to act as a result of any material contained in this publication. UK courts and tribunals are only required to follow the case law of the CJEU before withdrawal, which remains unchanged. If Parliament changes the retained EU law, for example when adopting new legislation, the binding effect of retained EU law and the relevant case law of the CJEU with regard to that specific amendment will no longer apply. Article 86(1) of the Peace and Union Agreement specifies that all cases pending before the CJEU at the end of the transitional period fall within the competence of the CJEU until their closure.
This includes decisions on appeals. Most will. Section 6(3) of EUWA2018 provides that any question concerning the interpretation of retained Union law (such as the provisions of the 2015 RCP derived from the EU) is to be decided in accordance with previous EU case-law and all retained general principles of Union law.