The Retained EU Law (Revocation and Reform) Act 2023 (REUL Act) is the new legal architecture that provides for significant changes to the interpretation and application of retained EU law (REUL) in the UK following the UK’s exit from the EU.
REUL and EUWA
REUL is a category of law that was created by sections 2 to 4 of the European Union (Withdrawal) Act 2018 (EUWA) at the end of the transition period, based on the EU and EU-derived law that applied in the UK at that time. The components of REUL include EU-derived domestic legislation which continued to be part of domestic law by virtue of section 2 of EUWA. Section 3 of EUWA resulted in retained direct EU legislation (RDEUL) forming part of domestic law. RDEUL is essentially the EU regulations and EU decisions which were directly applicable in the UK immediately before the end of the transition period. Section 4 of EUWA set out that EU-derived rights, powers liabilities, obligations, restrictions, remedies and procedures contained within directly effective rights derived from EU treaties and EU directives formed part of domestic law.
The REUL Act makes provision to remove the special status and EU-derived features of REUL (as set out in EUWA) in the UK at the end of 2023. The REUL Act also provides the UK Government with powers to restate, revoke, replace or update REUL until 2026, as set out further below.
REUL to be known as “assimilated law” after the end of 2023
Section 5 of the REUL Act provides that REUL will be known as “assimilated law” after the end of 2023. Related bodies or types of law will also be renamed for example retained direct EU legislation or retained case law will be known as “assimilated direct legislation” or “assimilated case law” going forward. The Government’s explanatory notes to the REUL Act explain that the renaming is required to reflect that various interpretative effects of EU law will no longer apply to this body of law once the changes set out in sections 2, 3 and 4 of the REUL Act have taken place. It is also indicative of an attempt to further embed legislation that originated through the UK’s membership of the EU into the domestic legal order.
Sunset clause and the power to preserve
Pursuant to section 1(1) of the REUL Act, at the end of 2023, the subordinate legislation and RDEUL listed in Schedule 1 to the Act will be revoked. That Schedule lists 587 pieces of REUL setting out whether it is subordinate legislation (Part 1 of Schedule 1) or RDEUL (Part 2 of Schedule 1).
Section 1(4) of the REUL Act enables a relevant national authority (a minister of the Crown, devolved authority, or the two acting jointly) to make regulations to effectively preserve certain specified legislation listed in Schedule 1 from revocation. However, such regulations must be made before the end of 31 October 2023. In June 2023, the Secretary of Business and Trade said that the Government had included this power in case there was an error in Schedule 1 and did not anticipate that the power will be used.
Schedule 1 was added to the REUL Act on 17 May 2023 as a result of a Government amendment during report stage in the House of Lords to deal with concerns around how the sunset provisions were originally drafted. In the REUL Bill as introduced last year, all REUL was to be revoked automatically unless specifically preserved. However, in the REUL Act as passed, all REUL remains unless revoked by Schedule 1 or by regulations made under the Act.
In addition to the list in Schedule 1 to the REUL Act, the Financial Services and Markets Act 2023 and the Procurement Bill (once passed) will revoke approximately 500 additional pieces of REUL.
Abolition of EU-derived interpretive principles
Section 2 of the REUL Act provides that directly effective rights and obligations derived from EU treaties and EU directives in section 4 of the EUWA will be repealed at the end of 2023. Similarly, the doctrine of EU law supremacy as well as general principles of EU law (such as the precautionary principle) will also be abolished by sections 3 and 4 respectively. In fact, the concept of supremacy is reversed such that where there is a conflict between domestic law and RDEUL, it is the RDEUL that must be read in a way that is compatible with domestic legislation.
Government powers under the REUL Act
Under sections 11-16 of the REUL Act, the Government has various powers to make regulations to restate, revoked, replace or update various aspects of REUL affected by the Act. For example, regulations can be made up until 23 June 2026 in order to add to the list of REUL that is revoked by Schedule 1. Alternatively, the powers could be used to codify retained case law if the Government decides that it wishes to preserve the precedent value of certain cases which would otherwise be affected by the abolition of EU-derived interpretive principles.
The extent of changes to legislation and how the government exercises the powers conferred upon it by the REUL Act will depend on the Government’s forthcoming policy decisions around how much reform is required for certain sector areas.
Jurisdiction of the REUL Act
The REUL Act extends to England and Wales, Scotland and Northern Ireland. Any amendment, repeal or revocation made by the REUL Act has the same territorial extent as the provision to which it relates. However, the Devolved Administrations are given many of the same powers as UK Ministers, in order to restate, revoke, replace or update REUL in devolved areas.
New powers for the courts in interpreting REUL
Section 6 of the REUL Act amends provisions in EUWA relating to the role of UK courts and tribunals in the interpretation of REUL. Only UK courts with authority equivalent to, or higher than, the Court of Appeal will have the discretion to depart from retained EU case law. Section 6 of the REUL Act inserts new sections into EUWA establishing a new fast-track reference procedure enabling lower courts or tribunals to refer points of law arising on REUL/assimilated law to the higher courts if the points of law are of “general public importance”. The higher courts will also have greater powers to diverge from Court of Justice of the EU (CJEU) judgments.
Retained EU law dashboard and report
Section 17 of the REUL Act requires the Secretary of State to do the following, every six months from the end of this year, up until 23 June 2026:
- Update the government’s REUL dashboard
- Publish a report on the revocation and reform of REUL summarising the data on the updated dashboard and the progress made in revoking and reforming REUL.
Next steps
Given the potential impact of the REUL Act across a wide range of industries it is key that clients consider the particular risks and opportunities presented by the Act. In terms of timescales, the REUL Act has been enacted so the revocation and reform of REUL is underway at pace. Assessing the impact of the REUL Act on your business should not be delayed. We are uniquely well-placed to advise clients in this area and can deliver bespoke training across a range of sectors so please get in touch with the specialists listed on the right hand side of this article and/or your usual Hogan Lovells contacts and we would be happy to help.
Authored by Owen Robinson and Melanie Johnson.
