Retained EU law reforms come into force in the UK

The Retained EU Law (Revocation and Reform) Act 2023 came into force on 1 January 2024 with the purpose of the legislation to distance the 'retained EU law' established in the UK post-Brexit from the EU law that previously applied in the UK.

The Act has removed the special features of EU law that governed the interpretation and application of this legislation. This has included revoking directly effective EU law rights that could override domestic legislation, and revoking the duty that required UK courts to interpret domestic legislation consistently with EU laws. To reflect these changes, retained EU law has now been renamed as ‘assimilated law’.

The retained EU law affected by the reforms includes most aspects of UK law that were previously derived or influenced by EU legislation, including environmental regulation, data protection, employment law, intellectual property, financial services, food safety, and medicines regulation. In relation to VAT, the government stated that it was so concerned by the uncertainty of the reforms impacting on the stability of the VAT regime and its ability to collect tax revenue effectively, that it had decided to exempt VAT legislation from the reforms.

Retained EU law expert David Thorneloe of Pinsent Masons said this creates some uncertainty: “The reforms set out the negative proposition of which legal principles cannot be applied in the UK legal system, but don’t address the positive side of the question as to what legal effects should actually flow from this. That is left to the courts to resolve. With more than 4,000 pieces of legislation affected, that will produce some uncertainty and a surge in litigation as our courts are asked to resolve these questions across the statute book about whether long-established legislation now produces different effects.”

Thorneloe explained that the impacts of the reforms will vary in different areas: “It quickly became clear, when we brought our teams together to assess the impacts of the Act in detail, that there are significant variations across subject areas. In employment law, for example, uncertainty levels are high because EU case law has played a major role in shaping workers’ rights and will need to be revisited by the courts. In intellectual property law, by contrast, uncertainty levels are lower, with the signals from the government and courts suggesting that the status quo is likely to be maintained on most, if not all issues.”

The government has embarked on a legislative programme to modify some of the legislation affected by the Act and to clarify how legislation affected will operate under the new ‘assimilated law’ regime. This has included regulations amending data protection legislation and others amending employment legislation.

Changes in the Act requiring UK courts and tribunals to have special new procedures to hear cases about whether to depart from established EU case law are not yet in force but are expected later in 2024.