82.These draft Regulations propose to introduce caps on international mobile roaming wholesale charges between the UK, Norway and Iceland. The Department for Digital, Culture, Media and Sport (DCMS) says that this would implement the UK’s obligations under the 2021 Free Trade Agreement with Norway, Iceland and Liechtenstein (“the Agreement”).36 The instrument also proposes to give Ofcom powers to enforce the caps.
83.Wholesale charges are the fees mobile operators charge each other when a customer travels to another country and uses the mobile network of an operator based in that territory, while retail charges are the fees operators charge their customers. DCMS explains that in the EU wholesale and retail roaming charges are capped, but that these caps ceased to apply to the UK after Brexit. Since then, three out of the four UK mobile operators have re-introduced roaming charges for new and upgrading customers travelling to the European Economic Area (EEA). According to DCMS, these draft Regulations can only cap wholesale charges because that is a cross-border international issue, while operators’ retail charges are a domestic matter that cannot be regulated by the UK in relation to Norway and Iceland. The expectation is, however, that the cap on wholesale charges will facilitate surcharge-free international mobile roaming for retail consumers.
84.We asked DCMS whether there would be an obligation on operators to pass on the benefits of the caps to their retail customers. The Department told us that: “Although the Regulations introduce a cap on the wholesale element only, mobile operators are expected to react to the wholesale cap by reacting at a retail level - by making it surcharge-free for their customers roaming in Norway and Iceland. This expectation has been clearly communicated. If operators do not react appropriately, the Government will have to consider what further measures may be necessary to ensure the Free Trade Agreement [ … ] facilitates surcharge-free international mobile roaming.”
85.The proposed caps are equivalent to the wholesale caps that currently apply in the EU/EEA. Unlike in the EU/EEA, however, there is no automatic mechanism to reduce these caps over time. DCMS told us that, instead, “the UK-EEA/EFTA [European Free Trade Association] Joint Committee will review the rates every two years, unless it otherwise decides, with a view to determining whether those rates are still appropriate. An option with any review could indeed be the EU/EEA roaming rate glidepath [ … ], as the Agreement talks about relevant international benchmarks, but it would be for the Joint Committee to decide.”
86.These made affirmative Regulations came into effect on 16 December 2022 and 1 January 2023 to further refine the sanctions regime against Russia. They extend the financial prohibitions to providing trusts or similar arrangements for designated persons and persons connected to Russia. They also close loopholes identified in existing restrictions on dealing with securities and credit arrangements for persons connected with Russia. They seek to disrupt Russia’s ability to trade internationally by prohibiting the provision of accountancy and advertising services. Additionally, the Regulations extend the current prohibitions on the export, supply and delivery of a range of goods including five additional chemicals.
87.These Regulations relax two rules, contained in retained EU law and related legislation, dealing with communications between investment firms providing portfolio management services and their retail customers. The changes are part of a wider package of reforms intended to improve the competitiveness of the UK’s financial services sector post-Brexit, while maintaining high regulatory standards.
88.First, the instrument removes the need for firms to inform their client when the overall value of the portfolio falls by 10%, and thereafter in multiples of 10%. HM Treasury (HMT) argues that this rule can be “detrimental to investors’ best interests” because it can prompt investors into “panic” selling. Instead, the investor and portfolio manager can decide that the firm will provide a report when the value of the portfolio decreases by a bilaterally agreed amount (although there is no obligation on firms to agree to such a customer request from a customer). In addition, other reporting requirements, such as quarterly reporting on the value of the portfolio, remain in place.
89.Second, the Regulations make electronic communication the default mode of communication between firms and their retail clients. Customers will still have the right to opt in to receive paper communications if they so choose.
90.Both rule changes were implemented for institutional investors in 2021.37 We believe that relaxing reporting requirements for retail investors requires even greater care than for institutional investors. HMT told us, however, that in consultations with investors and their representatives, and the Financial Conduct Authority under its consumer protection remit, all respondents supported the changes with the safeguards described above. While these reassurances are welcome, we remain concerned about whether the consultation processes were sufficiently representative of the interests of consumers.
91.This instrument will enable the implementation of parallel airport security screening regimes during a transitional phase. The Regulations revoke current arrangements based on retained EU law with effect from 31 January 2023 so that a new dual regime can be implemented under the domestic Aviation Single Consolidated Direction.38 As well as maintaining equivalent levels of airport security, the revised Direction will also allow the tapered roll out of Next Generation Security Checkpoint (“NGSC”) equipment. The NGSC equipment provides enhanced security screening capability and should enable faster screening of passengers, who will no longer be required to remove liquids and large electrical items, such as laptops, from their cabin baggage for screening. The Department for Transport states the aim is for all airports to have moved over to the NGSC equipment by June 2024.
92.Building on previous extensions,39 this instrument extends further, until 31 January 2024, the temporary suspension of sanitary and phytosanitary (SPS) checks on imports from the European Economic Area (EEA) into England which would otherwise have been introduced from 1 January 2023. Specifically, the instrument suspends:
93.The Department for Environment, Food and Rural Affairs (Defra) says that the Scottish and Welsh Governments are taking forward equivalent legislation, so that the same rules will apply across GB. According to Defra, the further extension is needed while work is still underway on a Target Operating Model for a new regime of border import controls. Defra says that this new regime will apply equally to products from the EU and the rest of the world, with a “proportionate risk-based and technologically advanced approach to controls”. Publication of the Target Operating Model and implementation timetable was originally scheduled for Autumn 2022, but Defra says that these will now be published early in 2023.
94.We note that ports and other businesses have already made significant investments to prepare for the anticipated introduction of import checks. Asked whether any support would be made available to businesses given the further delay in the introduction of these checks, Defra told us that: “We are aware that ports have invested their own money, recruited staff and made other preparations. We are working with them on a port-by-port basis, as well as engaging with representative bodies, to understand the implications of this decision for ports and the sector, and to address any issues or concerns they may have. This includes seeking to identify ways of preventing unnecessary additional capital cost and minimising ongoing costs.”
95.This instrument contains a number of measures relating to immigration legal aid. These include setting new fixed fees for advice on cases appealing to the asylum tribunal using an online system, and for advice on referrals into the National Referral Mechanism (NRM) for identifying victims of modern slavery. NRM referrals were made eligible for legal aid by the Nationality and Borders Act 2022. In a consultation, a large majority of respondents opposed the fixed fee approach on the bases that it could impact the quality of service offered and because civil legal aid fees have not risen since 2012. The Government are nevertheless proceeding and state that the standard fees offer “a fair remuneration package”, relate only to new services and will improve administration and forecasting.
96.The Regulations also include a new means of defining the immigration removal centres (IRC) at which legal aid can be provided under the Home Office’s Detained Asylum Casework (DAC) scheme, a fast-track process that expedites migrants through the asylum process if asylum is unlikely to be granted. Currently, legal aid is only available at three IRCs specified in legislation. The Regulations change this to any location that meets the statutory definition of an IRC. The Ministry of Justice (MoJ) says this will ensure legal aid provision is available in all IRCs in England and Wales if the DAC is extended to further centres. MoJ told us that a further three IRCs would currently fit the definition in the Regulations and that the Home Office may designate further centres in the future.
97.These Rules implement the requirement to show photographic identification (photo ID), as set out in the Elections Act 2022, in relation to principal area local elections and parish elections in England as well as Greater London Authority elections (both Mayoral and Assembly).
98.We reported an earlier instrument41 to the House which implemented the photo ID requirements for UK general elections. Our report criticised that guidance on how the new rules would be applied in practice had not yet been published, and that there was little time for a public awareness campaign and for local authorities to issue the new Voter Authority Certificate (“the Certificate”) for those who do not have an appropriate photo ID before the local elections in May 2023.
99.The Department for Levelling Up, Housing and Communities (DLUHC) told us that the Electoral Commission (EC) has now published guidance for Electoral Registration Officers (EROs),42 while guidance for Returning Officers is to be completed at the end of January and the Polling Station Handbook is due to be published in March.
100.We note that the EC launched its national awareness campaign on 9 January to support the introduction of the new requirements, and that the new Local Authority Administration Portal (ERO Portal), through which all online applications for the new Certificate will be made, is to go live on 16 January. While the Department is “confident” that Certificates will be issued to all those who apply successfully for one, we remain concerned, however, that there are only four months until the local elections. This leaves little time to reach those 4% of people who the EC estimates are eligible to vote but who may not have a recognised photo ID and who will therefore need to apply for the new Certificate to be able to vote.
36 Due to its operators’ commercial relationships with Switzerland, Liechtenstein has opted out of this specific aspect of the Free Trade Agreement.
37 Through the Markets in Financial Instruments (Capital Markets) (Amendment) Regulations 2021 (SI 2021/774), noted as an instrument of interest in SLSC, 9th Report (Session 2021–22, HL Paper 45).
38 These Directions are issued by the Secretary of State under Part 2 of the Aviation Security Act 1982 to those members of the directed party with sufficient security clearance to ensure appropriate handling.
39 The last extension was implemented through the Official Controls (Extension of Transitional Periods (Amendment) Regulations 2022 (SI 2022/621), see: SLSC, 5th Report (Session 2022–23, HL Paper 28).
40 The Faroe Islands, Greenland and Switzerland.
41 Draft Voter Identification Regulations 2022. SLSC, 18th Report (Session 2022–23, HL Paper 96).
42 Electoral Commission, ‘Voter Authority Certificates and Anonymous Elector’s Documents’: https://www.electoralcommission.org.uk/running-electoral-registration-england/voter-authority-certificates-and-anonymous-electors-documents [accessed 17 January 2023].