The Tribunal's approach
The case concerned an assessment to excise duty by HM Revenue and Customs arising out of alleged irregularities in the movement of shipments of wine on which the duty payable had been suspended. As part of this, the Tribunal was called on to interpret two sets of UK Regulations, each of which implemented an EU directive.
The impact of the end of the Brexit implementation period was considered only briefly (at paragraph [12] of the decision). Both parties agreed the effect of the European Union (Withdrawal) Act 2018 (EUWA 2018) was that the UK Regulations continued to apply as "retained EU law". That is uncontroversial.
Of more note was that the Tribunal stated that the requirement to construe those laws in conformity with the relevant EU directives in accordance with the Marleasing principle (and other general principles of EU law) also continues to apply. And it did so by reference only to the general provision of the EUWA 2018 dealing with the ongoing role of EU case law. No mention was made of the specific "gateway" in section 4(2)(b) of the Act through which propositions based on EU directives must pass to remain part of EU law post-Brexit.
This represents one of the approaches we mooted (in relation to another EU directive) in our article The Principal VAT Directive in the UK after Brexit last year. It is perhaps the simplest, and may mean that most or all EU tax law, even as developed by CJEU caselaw after Brexit, remains relevant in the UK. It will be interesting to see whether the UK tribunals and higher courts also adopt this approach in other cases or whether they follow the more granular assessment of the effect of the specific provisions of the relevant directive which section 4 of the EUWA 2018 would seem to require.
Next steps
More cases (both tax and non-tax) where the question of the continuing role of the Marleasing principle arises can be expected throughout the course of this year and beyond. But it may still be some time before a clear and consistent approach emerges. In the meantime, if you would like to discuss the issues this raises, please get in touch with the authors or one of your usual Hogan Lovells contacts.
Authored by Rupert Shiers and Adam Parry.
