On Global Trade & Investment
Published Three Times a Week By:
The Global Business Dialogue, Inc.
Washington, DC   Tel: 202-463-5074
No. 64 of 2016
Filed from Portland, Oregon

Click here for the October 26 quote on Sweden and Brexit.

"It is common ground that the most fundamental rule of UK constitutional law is that the Crown in Parliament is sovereign and that legislation enacted by the Crown with the consent of both Houses of Parliament is supreme."

The High Court of Justice
Lord Thomas, Sir Terence Etherton, and Lord Justice Sales
November 3, 2016
The three judges of Britain's High Court issued an opinion yesterday that greatly complicated the already complex issue of Brexit or, more fully, the effort of the government of Prime Minister Theresa May to execute on the decision of the June 23 referendum. That decision, of course, was that the United Kingdom should leave the European Union. 
Normally, we would have used the final, concluding paragraph of yesterday's judgment as the featured quote. It is the operational paragraph, and, as such, could hardly be more important. It said:

"For the reasons we have set out, 
we hold that the Secretary of State [for Exiting the European Union] does not have the power under the Crown's prerogative to give notice pursuant to article 50 of the TEU [Treaty on European Union] to withdraw from the European Union."

As important as that holding is, for us the discussion of the role of Parliament - a discussion that runs throughout the opinion - was even more compelling.
Brexit is life as a jigsaw puzzle in which the shapes of the pieces are constantly changing. Yet some aspects of it can be noted with reasonable confidence.
One is that Prime Minister May's government is appealing the decision. It is expected that the Supreme Court of the United Kingdom will hear that appeal in early December, though it may be January before a ruling is issued. The Supreme Court is, in fact, a relatively new institution, having been established in 2009 as a successor to the Law Lords, which had previously served as the UK's final judicial arbiters. 

Second, Mrs. May has told her European colleagues that she expects the government will win its appeal. And 

Third, she has also told them that it is still her intention to trigger Article 50 by the end of March. That will, of course, depend upon what the Supreme Court says, and not everyone is as confident as Mrs. May that their decision will favor the government. 
What can be noted with even more confidence are the actual words of yesterday's decision. The headline for today's entry included a truncated version of the Latin aphorism "Fiat justitia, ruat caelum." - "Let justice be done though the heavens fall." In a sense, the justices of the High Court laid claim to the spirit of that thought when, early in their opinion, they wrote:

"[T]he court in these proceedings is only dealing with a pure question of law. Nothing we say has any bearing on the question of the merits or demerits of a withdrawal by the United Kingdom from the European Union; nor does it have any bearing on government policy, because government policy is not law."

The argument that followed included these elements: 

Only Parliament can make or unmake laws. 

The notification by a Member State of its intention to withdraw from the European Union - Article 50 - is irrevocable and cannot be conditional. 
Such notification by the UK would in effect mean a change in the laws currently applicable in the UK and so must itself be expressed through an act of Parliament. 

That leads to the question, did Parliament implicitly grant the government of day the ability to trigger Article 50 by passing the European Union Referendum Act of 2015? Emphatically, the High Court justices said, no, it did not. They wrote:

"...a referendum on any topic can only be advisory for the lawmakers in Parliament unless very clear language to the contrary is used in the referendum in question. No such language is used in the 2015 Referendum Act."


The "remain" side of the Brexit debate is now celebrating a victory while those who voted to leave are feeling betrayed by the judiciary. Our impression of yesterday's ruling, however, is that it was a fair reading of the issue being adjudicated and stands a good chance of being upheld by the Supreme Court. Does that mean that the UK electorate has lost its bid to separate from the European Union? No, it does not, but it does mean that the referendum was only the first step. As the High Court put it:

"This court does not question the importance of the referendum as a political event, the significance of which will have to be assessed and taken into account elsewhere."
For our part, we think it would be a serious mistake to underestimate Prime Minister May's determination to give force to the referendum or her ability to overcome the disappointment of yesterday's ruling. After all, the basic message was that Parliament is supreme. And, for the moment, she is in charge there.
The GBD colloquium BREXIT: THE WTO ISSUES will look at the difficulties associated with untangling the UK's membership in the World Trade Organization from that of the European Union. This session, the first in a series of Brexit related events, will be held at the St. Regis Hotel on Wednesday, November 16, from 9 to 10:30. Click the title link above for full details, including registration options. GBD is extremely grateful to the law firm of Steptoe & Johnson for their co-sponsorship of this event and the series that will follow.
The Judgment takes you to the text of the opinion issued yesterday, November 3, by the High Court of Justice in London on the question of whether the government of Prime Minister Theresa May can trigger Article 50 of the Treaty on European Union or whether it needs to see further authority from Parliament. This was the source for today's featured quoted. 

The Referendum Act is the Wikipedia entry on the European Union Referendum Act of 2015.


Or Other GBD Notices, click below.
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R. K. Morris, Editor