United Kingdom: Retained EU Law Bill – what is staying for businesses when the door to Europe has closed?

There have been two spreadsheets provided by the Government which set out the laws that will remain in place in 2024 or will be repealed or subject to a “sunset” at the end of 2023. Some of the laws remaining are relevant to the manufacturing and automotive industries, and other more general and well-known areas such as TUPE (the transfer of employment legislation).

Below we present some examples of legislation in the UK that have a have a significant effect on businesses, and how this legislation will be affected by upcoming changes.

The Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Regulations 2012. This legislation restricts the use of ten hazardous substances in manufacture of electrical and electronic equipment. Manufacturers of such electrical products will need to ensure that the products still adhere to the restrictions in this legislation. This has been retained in the UK on the grounds of safety and to help prevent environmental incidents.

Regulation (EC) No 79/2009, which creates obligations for manufacturers and sets out the technical requirements for the type-approval of hydrogen-powered road vehicles. Given the target of becoming a Net Zero country by 2050, this legislation has been retained for safety reasons and will have far-reaching effects on the future manufacturing of hydrogen-powered vehicles in the UK. 

The almost indefinite delay placed on the implementation of the requirement to have the UKCA marking on products manufactured and/or sold in the UK, has resulted in the CE marking being kept as the main certification marking required for products in the UK.

The UK Competition (Amendment etc) (EU Exit) Regulations 2019 (Regulations) preserved the applicability of the EU’s block exemptions by modifying existing provisions in the Competition Act 1998 (CA). As a result of the Regulations, the block exemptions could be renewed or replaced in the UK, and as a result, the EU’s Motor Vehicle Block Exemption Regulation (Regulation 461/2010) (MVBER) has continued to apply in the UK, and provided an automatic exemption from the Chapter 1 CA prohibition on vertical agreements, for the purchase of spare parts and the provision of repair and maintenance services for motor vehicles, provided they fit within the specified parameters. UK Vertical agreements on this so-called motor vehicle aftermarket, however, also have to comply with the parameters specified in the Vertical Agreements Block Exemption Order 2022 (VABEO), which came into force in the UK on 1 June 2023 and replaces the EU Vertical Agreements Block Exemption (VBER). The MVBER also used to cover vertical agreements for the sale of new motor vehicles, but since 1 June 2013, these have only been subject in the UK to the VBER, which has now been replaced by the VABEO.

The UK has also begun to amend its laws relating to research and development and its exploitation. The UK implemented two orders relating to the CA, which came into force on 1 January 2023 and replaced the EU block exemptions relating to research and development, which had expired at the end of 2022.

An important and significant area of law affecting businesses seeking to expand into the UK has been the law affecting the position of commercial agents, who are people or companies, that find new customers in the UK, for the products manufactured and/or sold by their principal. Although the law governing the relationship between agents and principal in the UK, used to be governed solely by the so-called “common law of agency”, it became overlaid by the Commercial Agents Directive (86/653/EEC) (Directive) which, for the first time, sought to ensure that an agent was protected in relation to the termination of their contract. This directive was implemented in the UK by the Commercial Agents Regulations 1993 and its subsequent amendments (Agency Regulations). The agency regulations, establish the right of the agents to compensation on termination of the agency, and seeks to prevent companies from building a presence in a territory through the activities of an agent, before terminating the agency and taking all the credit for themselves.

Although the domestic law “The Commercial Agents Regulations 1993” was derived from the EU, it is now deemed part of the Retained EU Law. It is clear in section 1 (1) of the Retained EU Law (Revocation and Reform) Act 2023 that such law is not to be repealed at the end of 2023, but, UK courts are no longer bound by decisions of the Court of Justice of the EU, and like with many pieces of EU-derived legislation, it is not clear what the future is likely to be for this crucial area of law. 

In the UK, the main rights of consumers originated from EU law, some of which was set out in UK legislation, in a similar way to the laws relating to commercial agents. For instance, the UK Consumer Rights Act 2015 (CA) clearly sets out the rights of consumers in the UK, in particular contractual scenarios without making direct reference to EU law, and the CA is also part of the Retained EU Law that will not be repealed automatically at the end of 2023. If you have any questions regarding your company’s obligations to consumers, or uncertainty as to how your company’s contracts protect – or could better protect – the company when trading with consumers, please do not hesitate to contact our legal team who will be happy to assist you. 

There is of course always a risk that the Government will change its mind about the retained EU law, especially as political beliefs and attitudes directly influence policy. We will issue an update if these points change between now and 2024, but if you have any questions about the applicability of EU law that may have been retained or about the future of operating your business in the UK, our legal team are happy to assist.