Category: Trade

Alicia Nicholls

In a landmark decision handed down today, the London-based UK High Court in R (Miller) v Secretary of State for Exiting the EU, has held that the Theresa May-led UK Government cannot begin the formal process of leaving the European Union (EU)  without first seeking parliamentary approval.

As a bit of context, on June 23, 2016 52% of the British electorate voted for the UK to withdraw from the EU. However, for Brexit (British exit from the EU) to formally begin, notification of such intention by the UK must be made pursuant to Article 50 of the Treaty on European Union (Lisbon Treaty). This came into effect in 2009 and  gives an EU member state the express right to withdraw from the 28-member bloc in accordance with its own constitutional requirements and with the provisions contained in said Article. A useful synopsis of the Brexit process can be found here.

EU leaders have stated that they do not intend to begin negotiations with the UK until Article 50 is triggered. This probably explains why British Prime Minister Theresa May has indicated that she wishes to make the Article 50 notification by March 2017.

This latest chapter in the Brexit saga is an unexpected bump in the road for the conservative government. While Mrs.May had been part of the “Remain” camp while serving as Home Secretary in the cabinet of then Prime Minister David Cameron, she has since upon becoming Prime Minister stated in pellucid language that she intends to respect the will of the British people. She has famously stated that  “Brexit means Brexit”.

The Issue

Simply stated, the central issue before the High Court was whether under UK constitutional law, the Crown (as embodied by the executive) has prerogative power to make a notification pursuant to Article 50. Prerogative powers, also known as the Royal Prerogative, are residual legal powers which are vested in the Sovereign but are exercised primarily by the executive. One of such prerogative powers is the power to engage in international relations, for example, through the conclusion of treaties.

Arguments

The crux of the Government’s argument was that the Crown under its prerogative powers could make the Article 50 notification without Parliamentary approval and that this had to have been the intention of Parliament under the European Communities Act of 1972 (ECA 1972). The Government argued that neither the ECA nor any other primary legislation has removed the Crown’s prerogative power to withdraw from the Treaty on European Union (Lisbon Treaty) or any other treaties. The Secretary of State, David Davis, also argued that Parliament would have its say on the withdrawal agreement in any case.

However, not everyone was happy with Mrs. May’s stated intention to by-pass Parliament and effectively take away legal rights accruing to the  British people under the EU treaties. A legal challenge against the Government’s policy position was led by investment fund manager, Mrs Gina Miller, and supported by London-based Spanish hairdresser, Deir Dos Santos, and other interested parties. They referred to the fundamental principle in UK constitutional law that rights under the law of the UK cannot be varied by the Crown in exercise of its prerogative powers unless Parliament has expressly or impliedly given the Crown this right. They, therefore, argued that Parliament has not given such authority (whether expressly or impliedly) in neither the ECA 1972 nor in any subsequent Acts.

The Judgment

The 30-plus page judgment was delivered by Lord Thomas of Cwmgiedd, Lord Chief Justice of England and Wales. The court relied primarily on law from England and Wales but also from other Scottish and Welsh law. Referring to the common ground between the claimants, the court noted that they both acknowledged that a UK withdrawal from the EU would change domestic law in each of the UK’s jurisdictions and that once notice pursuant to Article 50 is given, it is irreversible.

Going back to first principles and with reference to decided cases, the Court delineated several fundamental and long settled tenets of UK constitutional law. Importantly, they reiterated that sovereignty of the UK parliament was a cornerstone of UK constitutional law. The Court noted that while the ECA 1972 was an exception to the supremacy of primary legislation (Acts of Parliament), it is Parliament which made this decision and only Parliament has the power to repeal this Act if it so chooses.

Additionally, the Court went on to reiterate that primary legislation cannot be displaced by the Crown in the exercise of prerogative powers. In other words, the Crown cannot change domestic law by exercising its prerogative powers, nor can it confer or deprive individuals of rights without Parliamentary action. Recall that the ECA 1972 gives effect to EU law in domestic law, including rights.

In summary, the two main reasons presented by the Court for its ruling were that:

(1) there is nothing in the text of the ECA 1972 to support that the Crown can exercise prerogative powers in such matters. Indeed, the Court methodically laid out several instances in which Parliament intended that EU law be introduced into domestic law in such a way that it could not be undone by the Crown in the exercise of its prerogative powers,

(2) it is contrary to the constitutional principles of parliamentary sovereignty and of the inability of the Crown to change domestic law through the exercise of prerogative powers

In summary, the Court ruled in favour of the claimants and held that the Crown had no prerogative power to give notice of withdrawal under Article 50.

Reactions to the Ruling

As one would expect, the ruling has brought mixed reactions. For Brexiteers and for Mrs May, the disappointment was palpable. They have viewed this defeat as undermining the will of the people. For their part, EU envoys do not appear to welcome the delay either.

For the Pro-EU supporters, the ruling is a small victory. After all, it is one more hurdle in the road towards Article 50. Ms. Miller in her speech after the ruling reiterated that the case was about “process and not politics” and urged the Government not to appeal the ruling. First Minister of Scotland, Nicola Sturgeon welcomed the ruling which she termed “hugely significant”, according to media reports.

What does this ruling mean?

So what do we know? Firstly, we know from the ruling that the Crown has no prerogative power to trigger Article 50 and that parliamentary approval is needed. But what form of approval should this take? Should there be just a yes or no vote or should there be a fuller debate on the scope of the negotiations as some are suggesting?   The ruling also appears to confirm that the referendum was merely advisory and not mandatory.

Does this ruling stop Brexit? No. The Court went to great pains to explain that what it was being called upon to decide  was a question of law and not the merits or demerits of a UK withdrawal from the EU. The court has not, nor was it its role to, decide on the political issue of whether there should be a Brexit.

But lest, we think this ruling has settled the matter of who is responsible for triggering Article 50, it should be noted that the Government has been granted leave to appeal to the UK Supreme Court which will hear the matter in December. The Supreme Court’s ruling is final. Therefore, it could either uphold the ruling of the lower court or it could overturn the lower court’s ruling and hold in favour of the Government.

Assuming that the Supreme Court upholds the High Court’s ruling and the question goes to Parliament for a vote, there are two possible scenarios. If the members of Parliament and the Peers decide to support the wishes of the British electorate and support making the notification, then the Government is free to make its Article 50 notification. However, if the Parliament votes against the triggering of Article 50, then the situation is less clear. My own view is that if the referendum is merely advisory, then would not Parliament have the final say? It will be interesting to see what happens in such a case. But will it be a simple yes or no vote or will Parliament seek to delineate the parameters under which the negotiations take place?

Here is another thing. It puts a spanner in the works of the quick Brexit Mrs. May was envisioning and the feasibility of the posited March 2017 deadline. There is no telling how long it will take for the question to be laid before parliament and for both houses of Parliament to debate and vote on the issue. What is certain though is that there will be more uncertainty. Some have speculated that Mrs. May may be forced to call an early general election.

But there is one bit of good news! On the back of this news, the value of UK Pound Sterling rose to GBP to 1.25 USD, still low but higher than the slump it has endured for the past few weeks when it appeared the Government was going for a “hard” Brexit. The rationale is that Parliamentary involvement would lead to a “soft” Brexit (where the UK remains in the single market and accepts the free movement of persons) as opposed to a “hard” Brexit which Mrs. May appeared to be supporting by her statements on immigration.

Suffice it to say, we have a long way to go before this issue of triggering Article 50 is resolved. And that is just the beginning of the Brexit process! It will be interesting to see whether the UK Government will rely on the same arguments it made in this case or whether it will change its pleadings when it makes its submissions before the Supreme Court in December. Interesting times are ahead!

The full judgment may be accessed here.

Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.