Brexit

Westminster update: UK and EU agree to no transition period extension

Your weekly update from our public affairs team on all the latest developments and debates in Parliament and across Whitehall.

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Last week, the government announced it would seek to ratify the 2000 Hague Convention, we were mentioned 14 times in Parliament, and the government gave a statement on UK-EU negotiations, which reaffirmed that the UK and EU have agreed not to extend the transition period.

1. UK-EU agree to continue negotiations and no extension of transition period

Last Tuesday chancellor of the Duchy of Lancaster Michael Gove MP gave a statement in the House of Commons on UK-EU negotiations following the high-level ‘stock take’ meeting between prime minister Boris Johnson, president of the European Council Charles Michel, president of the European Commission Ursula von der Leyen, and the president of the European Parliament David Sassoli.

He said that “all parties agreed that now was the moment to accelerate the pace of these negotiations.” At this meeting it was also agreed by the UK and EU that they will not extend the transition period so it is likely that the transition period will end on 31 December 2020.

Gove used the statement to again stress that any future agreement with the EU “must fully reflect our regained sovereignty, independence and autonomy,” and that the government was seeking to secure an agreement based on precedents from Japan, South Korea and Canada.

He also reiterated the promise that the transition period would not be extended, and said that the government “will manage the adjustment required at the end of the transition period in a flexible and pragmatic way to minimise any challenges and to maximise all opportunities.

In response shadow chancellor of the Duchy of Lancaster Rachel Reeves MP stressed “what a calamity leaving only on World Trade Organisation terms would be for our country” but acknowledged that “both the UK and the EU [have] confirmed that there is not going to be an extension of negotiations beyond the end of this year.”

Labour Backbencher Dr Rupa Huq MP argued that the government “seems to have missed a fundamental 80% of our GDP, which is services” and asked about financial equivalence.

Gove said “that the question of equivalence is one the EU will grant on the basis of an objective rules-based process” and that any equivalence advances in financial services and data adequacy will not come from external negotiation.

Talks will be “intensified” and start again on 29 June, with meetings taking place every week in July. Gove said there will be a “keen focus on finding an early understanding on the principles that will underpin a broad agreement” with the UK “looking to get things done in July.”

Read the statement

Read our update on our Brexit work

2. Divorce Bill completes final stages in the Commons

Last Wednesday the Divorce, Dissolution and Separation Bill passed both committee stage and third reading in the House of Commons. We were mentioned seven times.

We briefed MPs ahead of the session and put forward the following amendment in relation to financial order which was not tabled. Other amendments were tabled (although not passed )in areas of concern for us, including on notice periods in the Bill.

The amendment was not passed but Alex Chalk, justice minister, once again committed to addressing the service point with the Family Procedure Rules Committee stating “I absolutely get this point. We entirely understand that no one wants to see respondents being ambushed; it would be nonsensical. I listened very carefully to what she said about this so powerfully on Second Reading. I will return shortly to the measures to address the risk. In fact, I will have to do it now because I am running out of time. In short compass, I spoke to the chair of the Family Procedure Rule Committee only this week. We would like, through that committee, to ensure that timings are imposed when people should serve these notices. That is a really good thing.”

There were also several mentions in regard of legal aid for early advice in family law cases, strongly supported by chair of the Justice Select Committee, Sir Bob Neill MP (Conservative) who said “I have always taken the view, as the lord chancellor knows, that we perhaps took too much out of legal aid funding in some areas; the removal of legal aid support for early advice in matrimonial matters was, I think, an error, and it does no harm to admit that” In relation to the role of lawyers he said “it has been demonstrated clearly in evidence to our Select Committee that the best gateway to mediation and a much more collaborative approach to achieving resolution is through early access to a lawyer.”

The lord chancellor Robert Buckland QC MP, in addressing the next steps for the Bill said “the Bill does not come at the wrong time, because its current stage is the culmination of a lengthy process that was delayed by a general election and a new Parliament. Its timing has nothing to do with the current COVID-19 emergency. The Bill’s reforms will not come into force on Royal Assent, because time needs to be allowed for careful implementation. At this early stage, we are working towards an indicative timetable of implementation in autumn 2021. As I have said, the Bill will deliver much-needed reform in respect of which there is clear, strong and broad consensus”.

We'll look to work with the Family Procedure Rules Committee on the issues around service of notice.

The Bill will now pass to the House of Lords for consideration of amendments before moving to Royal Assent.

Read the debate

3. Corporate Insolvency and Governance Bill debated in the Lords

Last Tuesday 16 June and Wednesday 17 June, the Corporate Insolvency and Governance Bill had its committee stage.

We briefed peers ahead of the debate and put forward a suggested amendment in relation to the priority of moratorium and pre-moratorium debt which was tabled by Baroness Altmann (Conservative).

During the session, our briefing was mentioned seven times in the debate including favourably by Lord Bourne of Aberystwyth (Conservative) and Baroness Altmann.

Baroness Altmann, when discussing the amendments she tabled regarding the priority of moratorium debts, thanked us for our help and support in addressing these inconsistencies or insufficiencies in the Bill.

Lord Hope of Craighead (Crossbench) in speaking on his suggested amendment regarding the requirement for a list of all known creditors to be included in the list of ‘relevant documents’, noted the need for a provision of this kind was drawn to his attention by our briefing.

Baroness McIntosh of Pickering (Conservative), in discussing her support for amendments which would seek to clarify the role and independence of the monitor, noted our support for these amendments.

Baroness Warwick of Undercliffe (Labour) and Baroness Drake (Labour) quoted our briefing when speaking on the priority of moratorium and pre-moratorium debts. Lord Mann (Non-aff) referred to our support for a number of amendments during his speech.

Parliamentary under-secretary (Department for Business, Energy and Industrial Strategy) Lord Callanan stated that the moratorium was in place to ensure that companies were rescued rather than liquidated. The moratorium in question was built on “two pillars” – that directors believed a company was insolvent and that an insolvency practitioner thought the company was liable to be rescued having been in a moratorium.

We raised concerns about the priority of these debts and the potential for a super priority for lenders in our briefing. During the debate, the government committed to bring forward an amendment at report stage to amend the definition of pre-moratorium debts so that accelerated pre-moratorium debts will not be afforded super-priority status or protection.

In our briefing we noted our support for a number of amendments which sought to clarify the independence and role of the monitor. Lord Stevenson tabled a number of probing amendments related to the postholder of the position of monitor, but they were all withdrawn. The Opposition was concerned that the role of postholder would not have an appropriate set of specific regulations which apply to it.

The report stage and third reading of the Bill have been scheduled for 23 June. We'll be briefing again for these stages of the Bill.

Read the debate on 16 June

Read the debate on 17 June

4. Government confirms 2000 Hague Convention will be implemented

Last Wednesday, in response to an amendment to the Private International Law (Implementation of Agreements Bill) tabled by Lord Wallace of Tankerness, advocate-general for Scotland and justice minister Lord Keen announced that the government would seek to ratify the 2000 Hague Convention on the Protection of Adults with regard to England and Wales, something we've been calling for.

When proposing his amendment during report stage of the Bill, Lord Wallace mentioned us and quoted a passage directly from our briefing:

“Due to not being party to the convention, England and Wales does not have a central authority to issue the relevant certificates of authority for powers of attorney to act outside the jurisdiction. This gives rise to unnecessary difficulties in relation to the protection of overseas property and welfare by attorneys and deputies who have been appointed to protect potentially vulnerable people.”

The amendment was supported by Liberal Democrat justice spokesperson Lord Marks and shadow attorney-general Lord Falconer.

Lord Keen responded that he is “pleased to confirm to the noble and learned Lord that it is our intention to extend the ratification of this convention to England and Wales. Discussions have commenced with officials in Northern Ireland to ascertain whether the Northern Ireland Executive would require the extension to apply to Northern Ireland.”

He went on to say that this will be done via powers provided by the 2005 Mental Capacity Act. He said this will be done “as soon as [it] reasonably can, taking account of the need to take the Northern Ireland Executive with us if it is their wish that the matter be extended to Northern Ireland.”

Read the debate

5. Lords question Minister on Constitution Commission

Last Tuesday Baroness Whitaker (Labour) asked an oral question in the House of Lords regarding the terms of reference and appointments process for the proposed Constitution, Democracy and Rights Commission.

Responding on behalf of the government was Lord True, minister of state at the Cabinet Office, who declined to give any clear commitments, indicating that the coronavirus outbreak was partly responsible for the delay in the establishment of the Commission. He said careful consideration of the Commission’s scope is required, and that further announcements would be made in due course.

In supplementary questions a number of peers made suggestions as to what the Commission should look at. Lord Strathclyde (Conservative) asked whether the Commission would look at “political interference by the judiciary”, the 2005 Constitutional Reform Act and the possibility of returning the role of lord chancellor to the House of Lords.

Lord Howell of Guildford (Conservative) asked whether the Commission would look at the relationship between the Supreme Court and Parliament, and in particular at the Court’s recent judgment regarding interim custody orders in Northern Ireland. Lord Caine (Conservative) meanwhile, citing what he called the “damaging impact” of the retrospective application of the Human Rights Act on legacy cases in Northern Ireland, asked whether the Commission would consider legislating to limit the scope of the Act.

Lord Wallace of Saltaire (Liberal Democrat) asked the government to commit to holding a debate in the House of Lords on the agenda and terms of reference of the Commission before the summer, or at the latest in September.

The minister was unable to give any firm commitments in response to these questions, save to say that the government would “continue to promote the United Kingdom’s interests and values, including freedom of speech, human rights and the rule of law.”

Read the full exchange

Coming up this week

This week will see a number of pieces of legislation continue to progress in both Houses of Parliament.

In the Commons the Extradition (Provisional Arrest) Bill will have its Second Reading on Monday, the Trade Bill will continue with its Committee Stage on Tuesday and Thursday, and the Counter-Terrorism and Sentencing Bill will begin its Committee Stage in the Commons on Thursday.

In the Lords, the Corporate Insolvency and Governance Bill will have its Report Stage and Third Reading on Tuesday.

Beyond legislation, on Tuesday there will be a debate on a petition relating to the support for UK industries in response to Covid-19 in the Commons and the Lords Constitution Committee will be taking evidence on Wednesday.

View all upcoming parliamentary business

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