Brexit and mixity – the implications for a UK free trade agreement with the EU

Posted on 22 Dec 2016 by Brick Court

Aidan Robertson QC

In a blog in July, I referred to the question whether the EU is likely to have exclusive competence to conclude a free trade agreement with the UK or whether a free trade agreement will be a ‘mixed’ agreement requiring ratification by individual EU Member States so far as it would cover areas not falling within the EU’s exclusive competence.

The issue of the extent of the EU’s exclusive competence is under consideration by the Court of Justice of the European Union in relation to the EU’s free trade agreement with Singapore.

Advocate General Sharpston handed down her Opinion in this case on 21^st December 2016. In her view, the Singapore agreement is infected with some degree of mixity because the EU does not have exclusive competence over particular areas. These include provisions on trade in air transport services, maritime transport services, types of investment other than foreign direct investment; -government procurement in so far as they apply to transport services; non-commercial aspects of intellectual property rights; provisions laying down fundamental labour and environmental standards and falling within the scope of either social policy or environmental policy. Thus any free trade agreement with the UK involving those limited areas would require national ratification. However, the areas falling within EU exclusive competence, which would form the bulk of any agreement with the UK, could have provisional application without national ratification.

In other words, the outcome so far before the Court of Justice is as predicted by Professor Derrick Wyatt QC in July this year (see my previous blog): not much of a free trade agreement would fall within shared competence.

The Court will hand down its judgment in the new year.

The Court’s press release is here.

Advocate General Sharpston’s Opinion is here.

The return of the anti-suit injunction post-Brexit?

Posted on 19 Dec 2016 by Brick Court

Oliver Jones

The decision of the united Kingdom to leave the European Union has given rise, in the context of the rules regulating civil jurisdiction and enforcement in the EU, to questions as to how this may impact on the availability of the anti-suit injunction, an injunction issued by the courts of this jurisdiction to prevent a person from bringing proceedings in any other jurisdiction.

For many of us the anti-suit injunction featured heavily in our legal education as a prime example of the remedial power and flexibility of English law. However they have been a somewhat rare occurrence in recent legal practice because of the regime now embodied in the recast Brussels Regulation (Regulation (EU) No. 1215/2012), and its predecessor, the Brussels Regulation No. 44/2001.

Brexit is likely to lead to the UK’s departure – in some form – from that regime. As a consequence, this has at least given rise in some quarters to the perception that the anti-suit injunction may be in line for a return to prominence.

Common Law

The anti-suit injunction is to some degree a juridical weapon built on judicial mistrust. At common law, it was available where a party to a contract with an exclusive English jurisdiction clause sued, or threatened to sue, elsewhere, in breach of the jurisdiction clause. It was also available in a more amorphous category of case, where the conduct of the person was considered vexatious or oppressive in some way in the eyes of English law and thus constituted an equitable wrong. Because the foreign court could not be trusted to uphold the jurisdiction agreement, or prevent this oppressive conduct (or did not have the necessary powers), the English court had to step in and injunct the person from doing so itself. This was always styled, however, not as an interference with the jurisdiction of the foreign court, but simply with a personal restriction on a person over whom the English court had in personam jurisdiction.

ECJ rejects this approach in the context of legislation

The anti-suit injunction fell foul, however, of the European regime. This was a regime, it was said, founded upon a theory of mutual trust that represented the antithesis of the underlying rationale of the anti-suit injunction. That was established by the ECJ in Turner v Grovit (a case on the predecessor to the Recast Regulation and the Brussels Regulation, the Brussels Convention). This has rankled with some academics and practitioners because it was built on a premise that some do not believe in: namely, that all EU courts were created equal. It was felt that some EU courts did not give sufficient respect to exclusive jurisdiction clauses in favour of, in particular, the English courts.

Those concerns were only exacerbated with the ECJ’s decision in Allianz SpA v West Tankers Inc. That, in turn, put an end to the use of anti-suit injunctions to uphold arbitration agreements in the context of the Brussels regime, on essentially the same reasoning as in Turner (despite the fact that Article 1(1)(d) of the Brussels Regulation states that “the Regulation shall not apply to arbitration”).

Changes in the Recast Regulation

Those tasked with negotiating amendments to the Brussels Regulation, which when agreed became the Recast Regulation, sought to address some these problems in two ways. First, a provision was introduced that enabled a court chosen by the parties in an exclusive jurisdiction clause to continue to hear a claim despite a foreign court being first seised (reversing the ECJ’s decision in Erich Gasser GmbH v MISAT Srl). So it could not prevent those foreign proceedings happening, as it once could, but it could at least hear a competing case of its own. The second was to insert an additional recital – recital (12) – addressing the arbitration exception, that has given some hope that the anti-suit injunction might, at least to some degree, be back in an arbitration context (see AG Wathelet’s decision in Re Gazprom and the ECJ’s subsequent judgment).

What will become of the anti-suit injunction post-Brexit?

If we revert back to the common law, then the anti-suit injunction would return in the EU context. In this scenario, however, all of the reciprocity on which the Brussels regime is based will be lost. This might be good for aficionados and fans of the anti-suit, but is probably bad for any commercial lawyer who casts her gaze a little wider to look at the over-arching recognition and enforcement context. The return of the anti-suit injunction is unlikely to outweigh – as a benefit – the negatives that will follow from such an outcome.

The best outcome in relation to the underlying concerns that motivated the anti-suit injunction in the first place – in particular a lack of respect for exclusive jurisdiction clauses – would appear to be the UK re-signing up to the Recast Regulation, or the Lugano Convention.

This would not bring with it the complete remedial freedom and flexibility afforded by the common law, being the jurisdiction in which the anti-suit injunction was forged. Anti-suit injunctions would remain unavailable. The reality may be, however, as it may be in so many other areas of Brexit negotiations, that we are not able to pick out the plums and leave the duff behind. The price for reciprocity with other EU courts may be deference to them in relation to anti-suit injunctions, as in others respects.

New Irish Brexit case

Posted on 14 Dec 2016 by Brick Court

Maya Lester QC

The UK Supreme Court case challenging the Government’s use of the royal prerogative to trigger Article 50 has been widely reported on this blog and elsewhere.  Another set of proceedings is now to be lodged in the High Court in the Republic of Ireland.  The purpose of the Irish proceedings is said to be: (a) to ascertain whether Article 50 has already been triggered; (b) to persuade the Irish High Court to refer a question to the European Court of Justice in Luxembourg on the revocability of Article 50; and (c) to clarify whether leaving the European Union means automatically leaving the European Economic Area.  The likely claimants are members of the European Parliament, and defendants are the Government of Ireland and the European Commission and Council of Ministers.

Brexit: Security, surveillance and home affairs

Posted on 13 Dec 2016 by Brick Court

David Heaton

On Tuesday 6 December 2016, Brick Court hosted a Brexit panel discussion on “Security, Surveillance and Home Affairs”.  Gordon Corera, the BBC’s Security Correspondent, moderated the event.  He opened it by remarking that the subject presented many unanswered questions.

Brick Court’s David Anderson QC, Independent Reviewer of Terrorism Legislation since 2010, outlined the UK’s leading role within the EU on many counter-terrorism initiatives and observed that EU policy tends to reflect UK policy.  Anderson touched on how far the EU involves itself in national security given Article 4(2) of the Treaty on European Union, which reserves national security to Member States.  He identified two main fault-lines in EU–UK security cooperation: the UK’s wariness of compromising sovereignty and the rest of the EU’s wariness of privacy intrusion, typified by the CJEU’s decision in C-393/12 Digital Rights Ireland Ltd v Minister for Communications.  Anderson concluded by suggesting that two key questions post-Brexit are whether the EU’s measures will be sufficiently useful and whether UK participation in them will be satisfactory.

Alison Duncan-Mercy MBE, Deputy Director for Strategy and Communications at the National Counter Terrorism Policing HQ, spoke about EU–UK counter-terrorism policing cooperation and the likely effect of Brexit.  She outlined the UK’s counter-terrorism policing network and explained the threat presently posed by, amongst other things, the 850 individuals from the UK and those from elsewhere who have travelled to Syria and Iraq, some of whom have returned.  Duncan-Mercy explained the role of the eight (soon to be eleven) UK Counter Terrorism Police Liaison Officers stationed with EU Member States.  The critical elements of the strategy they implement are information exchange, investigative support, crisis support and capacity building.  Duncan-Mercy stated that the UK’s counter-terrorism relationships were and would remain stronger than ever due to the severe threat.

Georges Baur, Deputy Secretary General of EFTA (previously Deputy Head of the Liechtenstein Mission in Brussels), considered the bespoke relationship of EFTA states to EU security policy.  Security is generally outside the scope of EFTA and EFTA states have cooperation agreements with (not full membership of) EUROPOL, but all EFTA member states are Schengen states and use the Schengen Information System. Norway and Iceland are linked to the European Arrest Warrant by agreements on a surrender procedure.  Baur suggested that political dialogue means EFTA states adhere de facto to the EU’s Common Foreign and Security Policy.  All these were matters to bear in mind for anyone suggesting that EFTA membership might be a post-Brexit option for the UK.

Brick Court’s Jemima Stratford QC addressed the UK’s data protection legislation during and after Brexit.  Stratford explained that the General Data Protection Regulation (Regulation (EU) 2016/679), which replaces the Data Protection Directive (Directive 95/46/EC) from May 2018, will have direct application in the UK during Brexit negotiations.  New features include mandatory reporting of breaches, higher standards of consent and larger fines (up to £20 million from the current £500,000 maximum).  Stratford suggested that the UK’s post-Brexit data protection regime would likely mirror EU law: the UK has very limited room for manoeuvre if it wants a Commission adequacy decision to enable continued UK–EU dataflows.  Stratford concluded by observing that divergence between EU and UK data-protection law post-Brexit was likely to create unwelcome uncertainty for business.

Graham Smith of Bird & Bird discussed the mechanics of post-Brexit data-transfers and the data-protection implications of the very recent Investigatory Powers Act 2016 (IPA).  Smith explained the requirements to obtain a Commission adequacy decision, which would enable EU-UK dataflows post-Brexit.  Case C‑362/14 Schrems v Data Protection Commissioner established that state surveillance regimes are relevant to an adequacy determination and that generalised access to content of electronic communications compromises the essence of the right to respect for private life.  However, there was a disconnect between the different uses of bulk data, with vastly different levels of privacy intrusion, and the concept of “access” in Schrems.  Smith pointed out that the July 2016 EU–US Privacy Shield recognised that bulk powers can be a legitimate interference.  Smith suggested that, in terms of UK implications, the IPA is long on safeguards but short on limits to powers, blurs metadata and content, and includes “new” hacking powers; further, it is unclear whether government policies are sufficiently public under the IPA to satisfy human rights requirements.

The Rt Hon Yvette Cooper MP, Chair of the Home Affairs Select Committee, discussed the political dimensions of post-Brexit home affairs cooperation.  She remarked that it was difficult to start deciding on details when the government hadn’t articulated the big picture, although security cooperation was likely to remain an area for continued cooperation.  Evidence to the Home Affairs Select Committee was that the EUROPOL and SIS2 databases and the European Arrest Warrant were very effective instances of security cooperation.  Cooper identified three key political challenges in continuing this cooperation post-Brexit: a bespoke UK data-protection regime preventing continued UK access to EU security databases; the challenges of negotiating long-term arrangements within 18 months (and the likely need for transitional measures); and the possibility of negotiations on security cooperation being squeezed or upset by unrelated politics.  Cooper concluded by reiterating that Parliament would vote to trigger Article 50 if and when asked to do so.

The presentations were followed by a lively Q&A session.

Please click here to view a video recording of the event.

ICEL – Law Society of NI Brexit Conference

Posted on 05 Dec 2016 by Brick Court

Tuesday December 13th 14:00 – 17:00

Law Society House, 100 Victoria Street, Belfast

3 CPD Points

Chair – TBC

Much about Brexit is still unknown, but it will certainly be one of the most significant changes to the UK and Irish legal landscape since Ireland and the UK joined the EU in 1973. This afternoon conference brings together leading legal speakers from Northern Ireland, London and Dublin to examine a series of constitutional and economic issues.

Confirmed speakers and topics

• Professor Derrick Wyatt QC, Brick Court Chambers, London – Brexit and Article 50 – glass half full, or glass half empty
• David Anderson QC, Brick Court Chambers, London – Brexit and the Border
• Margaret Gray BL, practising in Belfast, Dublin and from Brick Court Chambers, London – Some implications for private and public law litigation
• Professor Christopher McCrudden, Queens University Belfast and Blackstone Chambers London – The devolved setting and fundamental rights
• Dorit McCann, Carson McDowell Solicitors Belfast – Competition and state aid post Brexit
• Clare Archbold, Legal Advisor to the Department of Justice for Northern Ireland – Northern Ireland Executive: mechanisms to respond to the prospect of Brexit

Please click here for the Irish Centre for European Law online registration page. The cost is £100 for non-members, £50 for members and £25 for associate members. It is also possible to pay in euros.

Please note that this event is being organised by ICEL. If you prefer to register using more traditional means, or have any other queries, please feel free to contact the Centre directly via email icel@tcd.ie or by phone: + 353 1 896 1845, by fax: + 353 1 896 4455. The Centre’s Office Hours are between 10am to 2pm Monday to Friday.

Article 50 ‘Brexit’ appeal

Posted on 02 Dec 2016 by Brick Court

The Supreme Court has uploaded the written arguments of the parties and interveners, which are available on its website here. The hearing is due to commence at 11am on Monday 5th December.

Eight members of Brick Court Chambers are instructed for various parties and interveners:

• Martin Chamberlain QC and Emily MacKenzie are instructed by Baker & McKenzie on behalf of the Scottish government.
• Richard Gordon QC and Tom Pascoe are instructed by the Welsh government.
• Tim Johnston and Professor Robert McCorquodale are instructed by Bindmans LLP on behalf of ‘The People’s Challenge’ (Graham Pigney and others), Interested Parties.
• Simon Salzedo QC and Andrew Henshaw QC are instructed by Wedlake Bell on behalf of Lawyers for Britain, who have filed written submissions as intervener.