BREXIT: Uncertainty continues, says expert, as High Court rules parliamentary approval needed for Article 50

Out-Law News | 03 Nov 2016 | 12:31 pm | 3 min. read

The UK government must seek a vote in parliament before it can trigger Article 50 and begin the country's withdrawal from the European Union, the High Court has ruled.

Upholding a claim for judicial review brought by businesswoman Gina Miller and others (32-page / 3MB PDF), three High Court judges ruled that when parliament passed the 1972 European Communities Act (ECA), it did not override its own sovereignty. Invoking Article 50 of the Treaty on European Union could not therefore be done unilaterally by the government, through the use of the Crown prerogative, according to the court.

Crucially, the High Court found that invoking Article 50 would "ultimately lead to the UK's withdrawal from the EU, which would in turn undo legal rights currently enjoyed by British citizens and companies in relation to their activities in other EU member states", according to EU law expert Guy Lougher of Pinsent Masons, the law firm behind Out-Law.com. Last week, the High Court in Northern Ireland dismissed a similar judicial review claim on the grounds that the constitutional consequences of triggering Article 50 were unclear.

For businesses, Lougher said that the best course of action was to "keep calm and carry on", as the judgment did little to alleviate the uncertainty that has prevailed since the results of the referendum became clear.

"The best course of action for business is to consider what outcome it would like to achieve from a Brexit and devise a plan for how best to achieve that outcome," he said. "This may well necessitate reaching out to government to ensure that business views will be taken into account in the government's current pre-Brexit planning. Meanwhile businesses can plan internally for the range of potential risks and opportunities which a Brexit might bring."

The government has already indicated its intention to appeal the High Court's decision to the UK's highest court, and this will "inevitably be heard by the Supreme Court as a matter of urgency, potentially in December", Lougher said. UK prime minister Theresa May previously indicated her intention to begin the Brexit process by the end of March 2017.

"If parliamentary approval is required before Article 50 can be formally triggered, it is unclear what the outcome will be," said Lougher.

"Even if the House of Commons votes in favour of invoking Article 50, it is far from clear that the House of Lords would do so. In such a scenario a major constitutional debate will be triggered, given that the referendum result was clearly in favour of Brexit – which may well lead to an early general election," he said.

Article 50 of Treaty on European Union sets out the formal legal process by which a member state can leave the trading bloc. Once 'triggered', a member state has two years in which to conclude negotiations and exit the EU. The wording states that a member state must do so "in accordance with its own constitutional requirements". The UK government has consistently maintained that this permits the use of its executive powers, bypassing the need for a parliamentary vote.

However the judges, who included the lord chief justice and the master of the rolls, pointed out that the Crown had no power to alter domestic law by use of its prerogative powers.

"It would be surprising indeed if … parliament, as the sovereign body under our constitution, intended to leave the continued existence of all the rights it introduced into domestic law [through the 1972 European Communities Act] subject to the choice of the Crown in the exercise of its prerogative powers as to whether to allow the Community Treaties to continue in place or to take the United Kingdom out of them," the judges said.

"In this context, it is also relevant to bear in mind the profound effects which parliament intended to produce in domestic law by enactment of the ECA 1972, which has led to its identification as a statute of special constitutional significance. The wide and profound extent of the legal changes in domestic law created by the ECA 1972 makes it especially unlikely that parliament intended to leave their continued existence in the hands of the Crown through the exercise of its prerogative powers," they said.

"Parliament having taken the major step of switching on the direct effect of EU law in the national legal systems by passing the ECA 1972 as primary legislation, it is not plausible to suppose that it intended that the Crown should be able by its own unilateral action under its prerogative powers to switch it off again," they said.