European Union (Withdrawal) Act 2018

Schedule 1: Further provision about exceptions to savings and incorporation

207. This Schedule sets out some further exceptions to the preservation and conversion of EU law provided for under sections 2, 3 and 4. This Schedule should be read together with Part 4 of Schedule 8, which makes specific transitional, transitory and saving provision.

Challenges to validity of retained EU law

208. Paragraph 1 provides that, on or after exit day, no challenge can be brought in the UK courts to retained EU law on the basis that immediately before exit day, an EU instrument (for example, an EU regulation or decision) was invalid. This restriction is, however, subject to the exceptions in sub-paragraph (2). First, any decisions of the CJEU which pre-date exit day about the validity of the instrument will not be affected. Secondly, a Minister of the Crown has the power to describe in regulations types of challenge to validity which will be capable of being brought in domestic courts on or after exit day. Sub-paragraph (3) provides that any such regulations may enable challenges which, prior to exit, would have proceeded against an EU institution to proceed against a UK public authority following exit.

General principles of EU law

209. Paragraph 2 provides that only the EU general principles which have been recognised in CJEU cases decided before exit, will form part of domestic law after exit. These include, for example, some fundamental rights, non-retroactivity, and proportionality. More detail on the general principles is set out at paragraph 59 of these notes.
210. Paragraph 3 provides that there is no right of action in domestic law post-exit based on failure to comply with the EU general principles. Courts cannot disapply domestic laws post-exit on the basis that they are incompatible with the EU general principles. Further, domestic courts will not be able to rule that a particular act was unlawful or quash any action taken on the basis that it was not compatible with the general principles. Courts will, however, be required under section 6 to interpret retained EU law in accordance with the retained general principles.
211. Paragraph 3 is subject to the transitional provisions set out under paragraph 39 of Schedule 8. Sub-paragraph (5) of that paragraph sets out that the restriction on challenges based on incompatibility with any of the general principles of EU law (set out in paragraph 3 of Schedule 1) does not apply in respect of certain proceedings begun within three years of exit day. In order to fall within the scope of this sub-paragraph, any challenge must relate to something that occurred before exit day and may be made against either administrative action or domestic legislation other than Acts of Parliament or the common law. Courts, tribunals and other public authorities will be able to disapply legislation or quash conduct in the event of a successful challenge.
212. The right of challenge cannot be used in relation to anything which gives effect to or enforces an Act of Parliament or the common law, or anything which could not have been different as a result of any Act of Parliament or rule of law. Paragraph 3 should also be read in conjunction with sub-paragraphs (1) and (2) of paragraph 39 of Schedule 8, which set out how questions arising under the devolution statutes about the validity of devolved legislation (including questions about the compatibility of devolved legislation with general principles) are affected by the amendments made by section 12 and Part 1 of Schedule 3 to the Act.

Rule in Francovich

213. In Francovich1 the CJEU established that in some circumstances states have to compensate individuals for damage that they suffer as a result of the state’s breach of EU law. EU law confers a right to reparation where the rule of law infringed is intended to confer rights on individuals, the breach is ‘sufficiently serious’, which means that the member state has manifestly and gravely disregarded the limits of its discretion, and where there is a direct causal link between the breach and the damage.
214. Paragraph 4 provides that the right to claim damages against the state for breaches of EU law (Francovich damages) will not be available after exit. This provision does not affect any specific statutory rights to claim damages in respect of breaches of retained EU law (for example, under the Public Contracts Regulations 2015) or the case law which applies to the interpretation of any such provisions.
215. Paragraph 4 is subject to the transitional provisions set out under paragraph 39 of Schedule 8. In particular, sub-paragraph (7) delays the prohibition in the Bill on seeking Francovich damages in domestic law for two years after exit day. This ensures that the Bill will not prevent individuals from continuing to seek such damages in domestic law where a breach of EU law occurred before exit day.

Interpretation

216. Paragraph 5 clarifies that references in section 6 and this Schedule to the principle of supremacy of EU law, the Charter of Fundamental Rights, any general principle of EU law or the rule in Francovich are to be read as references to that principle, Charter or rule as they stand at exit day, not as they will operate in EU law in the future.