Explanatory Notes

Clause 1: Saving of ECA for implementation period

77 This clause inserts a new section 1A into the EU (Withdrawal) Act 2018. New section 1A saves and amends the ECA for the purpose of giving effect to Part 4 of the Withdrawal Agreement. Until ‘exit day’, the ECA’s purpose is to implement EU law as required by the UK’s membership of the EU; during the implementation period, by contrast, the modified and repurposed 1972 Act will implement EU law as set out in the Withdrawal Agreement.

78 Subsection (1) makes clear that the provisions in the following subsections (2) to (4) will have effect despite the repeal of the ECA on ‘exit day’.

79 Subsection (2) provides for the ECA to continue to have effect in domestic law, subject to the modifications repurposing that Act so that it works to give effect to the implementation period at subsections (3) to (5). To the extent the ECA currently has any effect in the law of a relevant territory - the Isle of Man, any of the Channel Islands or Gibraltar - it will continue to have the same effect for the purposes of the implementation period.

80 Subsection (3) modifies the saved ECA, so as to ensure that it gives effect to EU law in the UK for the purposes of the implementation period at Part 4 of the Withdrawal Agreement. Specifically:

a. (3)(a)(i) adds Part 4 of the Withdrawal Agreement, except those provisions that relate to the Common Foreign and Security Policy, to the definition of ‘the Treaties’ and ‘the EU Treaties’ in section 1(2) of the ECA. This means that international agreements concluded by the EU and which enter into force during the implementation period will be given effect to via Part 4 of the Withdrawal Agreement.

b. (3)(a)(ii) takes a snapshot of what falls within the definition of ‘the Treaties’ and ‘the EU Treaties’ on exit day. Article 129(4) of the Withdrawal Agreement states that ‘the United Kingdom may negotiate, sign and ratify international agreements entered into in its own capacity in the areas of exclusive competence of the Union, provided those agreements do not enter into force or apply during the transition period, unless so authorised by the Union’. 3(a)(ii) also provides a power to Ministers to exclude an international agreement from the definition of Treaties / EU Treaties where appropriate, to cater for the eventuality where the UK negotiates, signs and ratifies an international agreement during the implementation period in an area of EU exclusive competence, the EU authorises the UK to bring it into force or for it to apply during the implementation period, and, in order to do so, the UK needs to remove an existing EU-third country international agreement given effect to via the ECA, and which conflicts with this new international agreement, from the definition of ‘the Treaties’.

c. (3)(b) amends section 2(2) of the ECA so that the reference in that section to the ‘objects of the EU’ becomes a reference to those objects so far as they are applicable to and in the UK by virtue of Part 4 of the Withdrawal Agreement. This modifies section 2(2) of the ECA so that it functions to give effect to the UK’s EU obligations as per Part 4 of the Withdrawal Agreement on the implementation period.

d. (3)(c) removes section 2(3) of the ECA. Section 2(3) authorised payments due under the Treaties to be made to the EU. In order to allow for payments due under the Withdrawal Agreement the UK will rely on clause 20 of the Bill, which provides for payments to be made under a standing service provision until March 2021, after which payment will be made under the system of supply.

e. (3)(d) modifies section 3(1) of the ECA, so that in legal proceedings questions regarding the meaning or effect of the Withdrawal Agreement during the implementation period shall be treated as a question of law. Such questions are to be determined by the domestic court, in accordance with relevant decisions of the CJEU in line with Part 4 of the Withdrawal Agreement.

f. (3)(e) specifically modifies sections 5 and 6 of the ECA (concerning customs duties and the Common Agricultural Policy (CAP)) to make sure that they continue to operate properly during the implementation period and to avoid any suggestion that the Bill merely preserves CAP arrangements and customs duties etc as they had effect at the moment of withdrawal.

g. (3)(f) modifies Part 2 of Schedule 1 of the ECA:

i. (i) modifies the definition of ‘EU customs duty’ so that any reference to such provision is a reference to it so far as it is applicable to and in the UK by virtue of Part 4 of the Withdrawal Agreement during the implementation period;

ii. (ii) modifies the definition of ‘Member State’ that will apply in domestic law during the implementation period.

81 Subsection (4) provides a definition for ‘relevant territory’ being any territory to which the ECA has applied in any limited capacity previously. Specifically, the term includes the Isle of Man, any of the Channel Islands or Gibraltar.

82 Subsection (5) will repeal subsections (1) to (4) at the end of the implementation period, referred to as ‘IP completion day’ in the Bill. This will be at the point the implementation period ends i.e. 11.00pm on 31 December 2020.

83 Subsection (6) clarifies the meaning of various terms referenced in this section, specifically:

a. ‘implementation period’ - implementation or transition period, as provided for by Part 4 of the Withdrawal Agreement and beginning with ‘exit day’ and ending on ‘IP completion day’;

b. ‘IP completion day’ - as defined in clause 39(1) of the Bill, is 31 December 2020 at 11.00pm, unless amended by regulations under clause 39(4) of the Bill to take account of any changes to EU summertime arrangements; and

c. ‘Withdrawal Agreement’ - as defined in clause 39(1) of the Bill, is the agreement between the United Kingdom and the EU under Article 50(2) of the TEU which sets out arrangements for the United Kingdom’s withdrawal from the EU.

84 Subsection (7) clarifies that:

a. references to the ECA are to be read as being or as including references to the repurposed and saved version of that Act so far as the context permits or requires; and

b. references to any part of the Withdrawal Agreement or of the EEA EFTA Separation Agreement also include references to a different part of that agreement so far as apply to that part. Provisions in other parts of the Withdrawal Agreement will, therefore, be caught by the term ‘Part 4 of the Withdrawal Agreement’, so far as those provisions apply to Part 4, for example, the definitions in Article 2 of the Withdrawal Agreement.


Prepared 19th December 2019