What is the Retained EU Law (Revocation and Reform) Bill?
The Retained EU Law (Revocation and Reform) Bill 2022, commonly referred to as the Brexit Bonfire Bill, is intended to end the principle of the supremacy of EU law. The Bill empowers UK Government to restate, revoke and replace retained EU law. So far, in the region of 4,800 pieces of retained EU law have been identified and this total is likely to keep increasing. UK Government says the Bill will remove needless bureaucracy and encourage innovation. However, many businesses who operate across the UK and EU are less enthused about the prospect of abandoning EU laws and the resultant regulatory divergence, since complying with two different regulatory regimes adds cost and complexity.
What was the 10 May statement by Kemi Badenoch?
On 10 May, the Secretary of State for Department for Business and Trade issued a statement confirming that the controversial sunset clause in the Bill will be abandoned.
In case you are (understandably) confused about what that means, here is a simple summary:
- Before the 10 May statement: the Bill contained a sunset clause saying that all EU law will be repealed at the end of 2023 unless the UK Government expressly assimilated it into UK law.
- Since the 10 May statement: the sunset clause has been abandoned. This means that the Bill will now list those retained EU laws which will be revoked, and the rest will remain in force (at least for now).
UK Government will continue to review retained EU law, which is not revoked, and this review process will continue during the remainder of 2023 and beyond. However, the bonfire, which would have taken place by the end of 2023, is now more likely to be a sparkler. In the region of 600 pieces of retained EU law have so far been identified to be scrapped by the end of 2023, but this won't be a mass cull of all EU legislation at the end of the year.
Why has UK business been concerned about the Bill - and especially the sunset clause?
The Bill, and the sunset clause, were causing great uncertainty for UK businesses, who didn't know what regulations they would need to comply with next year. Concerns were that uncertainty could be a brake on investment, and that the UK regulatory regime would be perceived globally as more complex to navigate. There were strong doubts that civil servants had the manpower to consider and revoke / adopt more than 4,000 pieces of legislation by the end of this year and that the Government had set itself an overambitious task. Uncertainty is the enemy of business, so this reversal is likely to be viewed as good news for UK plc.
That said, UK business will now need to consider the Bill again to account for the changes confirmed by the 10 May statement. They will want to know what the Bill will look like in its final form so they can be clear about their obligations and can assess the benefits/detriments of any change and the costs of compliance. It seems inevitable that there will continue to be more divergence between the UK legislative framework and the EU legislative framework and UK businesses will be hoping that any change will ensure the UK is aligned to a global standard rather than imposing an additional regulatory burden on UK businesses. Examples of EU retained law which manufacturing businesses will be monitoring closely for change are set out below:
- General Product Safety Regulations 2005 – safety of consumer goods – concern that lower standards would reduce the ability to export.
- Working Time Regulations 1998, TUPE etc – workplace rights - the Government is currently consulting on proposed reforms.
- UK REACH – regulation applying to chemical substances - new registration model anticipated – concern about costs of the duplicative system.
- UK GDPR – data protection and privacy - further change proposed in the form of the Data Protection and Digital Information Bill (no.2) – some changes to the regulatory burden anticipated but the EU's adequacy decision must be preserved.
- Numerous examples of EU retained law setting out environmental protections.
What is next for the Retained EU Law (Revocation and Reform) Bill?
This will not be the end of the story for the Bill by any means. This is a highly political piece of legislation and prominent public figures have already publicly criticised the Government for the U-turn and for failing to stick to the deadline to scrap thousands of EU laws by the end of 2023. Meanwhile, the Department for Business & Trade continues to identify more pieces of retained EU law which will need to be reviewed by UK Government, and which could then be scrapped further down the line. The 10 May statement creates a much more realistic timeframe for this process to be undertaken, which is welcome news for UK businesses, but the process itself hasn't been abandoned. Uncertainty continues to be the new norm.
Please get in touch if you want to know more.
This article was also authored by Caitlin Evenden, Trainee Solicitor at Womble Bond Dickinson.