Windsor Framework (Retail Movement Scheme) Regulations 2023
Lord Browne of Belmont Excerpts(2 years, 11 months ago)
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Lord Browne of Belmont (DUP)
My Lords, I am not convinced that the regulations before us today are intra vires, for exactly the same reasons I doubt that the Windsor enforcement regulations are intra vires. I set out in detail the reason why I am unconvinced about this in my speech on the enforcement regulations when they were debated on 19 September, but the Minister did not respond at that time. I do not intend to repeat my speech of a month ago today in full and want to move on to address some additional points today, but I begin by drawing it again to the attention of the Government and asking for a response, not merely in relation to the enforcement regulations but the retail movement scheme regulations and the plant health regulations we are debating today.
In brief, while I acknowledge that the regulation-making powers are quite broad, they are not infinitely elastic, but held accountable to a fixed reality: the language of the protocol, now renamed the Windsor Framework. Both these sets of regulations have at their heart and give legal effect to EU Regulation 1231/ 2023. As we have heard, that affirms and effects the division of the UK into two, for the reasons that have been set out by the earlier speakers. This is a hugely important matter for the Windsor Framework retail movement scheme, plant health regulations, as well as the enforcement regulations 2023, because Article 1(2) of the protocol states, as I said on 19 September:
“‘This Protocol respects the essential State functions and territorial integrity of the United Kingdom’.
It is made directly effective in UK law by Section 7A(l)(a) of the European Union (Withdrawal Agreement) Act, requiring that
‘all such rights, powers, liabilities, obligations and restrictions from time to time created or arising by or under the withdrawal agreement’
are applied.
How can Article 1(2) be applied if attempts are made to implement other parts of the protocol that have the effect of actively disrespecting the territorial integrity and essential state functions of the United Kingdom that it insists on respecting? I can see that, if the regulation-making power were for the purpose of giving effect to certain articles of the protocol and not others, this vires difficulty may not necessarily apply. But the regulation-making power simply references the protocol/Windsor Framework, which means that it must be taken as a whole. That means that any Act that purports to implement it cannot contradict any part of the protocol, including Articles 1 and 2”. —[Official Report, 19/9/23; cols. GC 287-88.]
The same problem also arises because of the trade diversionary effects of both sets of regulations before us today and the trade diversionary implications of preparing for them. It is now known that the amount of product coming from Great Britain to Northern Ireland is significantly less than previously, with an increased number of empty trailers on the return journey. How can it be appropriate for the Government to introduce legislation within the confines of the regulation-making power to give effect to legislation which is supposed to be accountable to the Windsor Framework, when its actual consequence is to create trade diversion, which Article 16 of the Windsor Framework expressly states is inimical to the purpose and intention of the Windsor Framework, such that if this is the result, the parties may derogate from the treaty? I very much look forward to what the Minister has to say.
In order to understand the regulations before us today, and particularly the green lane that they purport to help construct, it is useful to look at how signage works in the rest of the European Union. Moving from one European Union jurisdiction to another, you are effectively presented with three lanes. The blue lane is for any goods moving from one EU jurisdiction to another EU jurisdiction. There is no paperwork and there are no checks. Then there is a red lane. This is for any good that has to be declared and subject to customs and potentially SPS paperwork and checks. Then there is a green lane, which means you can move freely, because you have nothing to declare. However, here in Northern Ireland, as a unionist, I particularly know what a fake green is when I see it. The truth is that what the regulations before us today offer is not an arrangement that, in the words of the Prime Minister,
“removes any sense of a border in the Irish sea”, —[Official Report, Commons, 27/2/23; col. 571.]
such that he could then, and we can now, talk about the regulations before us today as giving effect to aspects of the green lane.
In reality, the Windsor Framework, as the regulations before us today powerfully testify, effects and affirms a border where no border has a right to be. EU regulation 2023/1231, which it is the purpose of these retail movement and plant health regulations to operationalise—and without which they make no sense and cannot be understood or assessed—is about making provision for an alternative and less disruptive border experience than one would otherwise have. However, two things must be understood. First, the alternative arrangements are alternative border arrangements and thus the border remains very much in place and can be negotiated only if you have an export number, apply to join the trusted trader scheme and are accepted, fill in SPS forms, and are potentially subject to some checks at border control posts.
Secondly, article 14 of EU regulation 2023/1231 makes it absolutely clear that the EU reserves the right to remove this border experience in favour of the most disruptive available that it could mete out between itself and a foreign country. In that sense, the Windsor Framework does not get rid of any sense of the border in the Irish Sea any more than it creates a green lane. Its actual effect is to confirm the presence of the border in the Irish Sea and to introduce two red lanes, one of which is less demanding than the other, but which defaults to full disruption at the behest of the European Union.
Neither arrangement reconnects Northern Ireland to the UK single market, which can happen only when it is given unfettered access, which means access without the fettering of customs or SPS requirements as per trade movements between Scotland, England and Wales, or trade movements within any single market. Indeed, rather than reconnecting Northern Ireland to the UK single market, the purpose of the regulations today is to define two different levels of fettering at the border.
Therefore, rather than removing the border, the purpose of these Windsor regulations is to effect and affirm it. This makes it absolutely clear that talk about green lanes is totally confusing and, frankly, misleading. It generates an impression of a green light, of the coast being clear, and so on, but nothing could be further from the truth.
However, in order to really understand the regulations before us today, we need to see them in context, because the truth is even more awkward. Under the border target operating model, it is widely recognised that it is much easier to move goods from the EU into GB than to move goods from GB to the EU. This has immediate consequences for Northern Ireland because all red-lane goods movements between Northern Ireland and GB, which are in the same country, are subject to more fettering than movements of goods from the EU to GB—between different countries.
To this one might say, “But what about the green lane?”—which is of course a red lane. In the first instance, Northern Ireland is part of the same country as the rest of the UK and so should not be disinherited from its own single market by the imposition of any kind of border obstacles. In the second instance, when we study the particular manifestation of the red lane that masquerades as a green lane, we find that some companies regard the burdens associated with it as so onerous that they actually prefer the other red lane. For example, Lynas Foodservice has said that it intends to move 75% of its products on the red lane; in other words, we will have accepted an arrangement that places the interests of GB more with those of France, Germany, Bulgaria and Estonia than with Northern Ireland, because we will want to make it easier for goods to be traded between those countries and Great Britain, in terms of fettering, than with part of our own country. We will have done this, even as we know that through the EU we are offering easy access to our market to those countries—France, Germany, et cetera—that are refusing to respect the territorial integrity of the United Kingdom, imposing both economic disadvantage and the partial disenfranchisement of part of the UK.
I am happy to support this Motion to Regret.
Windsor Framework (Enforcement etc.) Regulations 2023
Lord Browne of Belmont Excerpts(3 years ago)
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Lord Browne of Belmont (DUP)
My Lords, having listened to my noble friends, it is doubtful that these regulations are intra vires. They are tied umbilically to regulation 2023/1231, which, as we have seen, rather than removing the border down the Irish Sea, bestows on it an alternative set of border arrangements which, while in some ways are less demanding, remain border arrangements—and ones that, crucially, are predicated on Article 14, which gives the EU the default right to press its full rights against the border it has thrust across our country. The EU regulations consequently disrespect the territorial integrity and the essential state functions of the UK, both by dividing it with an international border and asserting the default right to control that border within our country.
This is a hugely important matter for the Windsor Framework (Enforcement etc.) Regulations 2023 because Article 1(2) of the protocol states:
“This Protocol respects the essential State functions and territorial integrity of the United Kingdom”.
It is made directly effective in UK law by Section 7A(l)(a) of the European Union (Withdrawal Agreement) Act, requiring that
“all such rights, powers, liabilities, obligations and restrictions from time to time created or arising by or under the withdrawal agreement”
are applied.
How can Article 1(2) be applied if attempts are made to implement other parts of the protocol that have the effect of actively disrespecting the territorial integrity and essential state functions of the United Kingdom that it insists on respecting? I can see that, if the regulation-making power were for the purpose of giving effect to certain articles of the protocol and not others, this vires difficulty may not necessarily apply. But the regulation-making power simply references the protocol/Windsor Framework, which means that it must be taken as a whole. That means that any Act that purports to implement it cannot contradict any part of the protocol, including Articles 1 and 2.
Some might say that the power affords the Minister significant latitude. That may be the case, but the power is not a power to do anything; it is constrained by references to the protocol—now the Windsor Framework. Although the Minister may have freedom, this plainly does not extend to directly contradicting any part of the framework, which these regulations plainly do, in acting in direct opposition to Article 1(2).
The Windsor Framework enforcement regulations are also problematic because, unlike most forms of legislation that do not have an impact until they formally come into effect, businesses have been busily restructuring in preparation for the regulations, as part of the retail movement scheme—first announced as the green lane in February. For some months, Asda has started to use “not for EU” labels. This means that, unusually, we can already see something of the effect of these regulations. Moreover, their actual consequence has been plain to see since 14 June, if not before, when the EU regulation 2023/1231, to which they relate and without which they make no sense, came into effect.
Many businesses have made it clear that relying on the retail movement scheme and its enforcement mechanism, as set out in these regulations, is too complicated, and it is too expensive for the retail movement scheme to simply take over from the old and very light-touch scheme for temporary agri-food movements to Northern Ireland—STAMNI—which it replaces, such that supermarkets can continue to function on the basis of the old GB-NI supply chains that attended and defined what was the UK single market for goods until the end of 31 December 2020, giving effect to UK economic nationality.
In this context, big supermarkets I have already referred to, such as Tesco, have been restructuring their supply chains to move as much as possible of what previously came from Great Britain to Northern Ireland so that, after 1 October, it comes from the Republic of Ireland to Northern Ireland. One might respond to this by arguing that, to the extent that these regulations apply GB regulations, their enforcement component cannot have a trade diversionary effect. There are two difficulties with this assertion. In the first instance, to the extent that the deployment of these standards is through an SPS certificate—in relation to which one must have an export number and have obtained and kept membership of the trusted trader scheme, negotiated a border control post and provided “not for EU” labels—this all amounts to costs that do not apply to goods movements in other parts of the United Kingdom. This is an increased cost compared to STAMNI.
In the second instance, the impact of the retail movement scheme in terms of enforcement regulations does not simply determine where GB regulations apply. It also determines, by implication, where they cannot apply and where EU regulations, the presence of which was obscured by STAMNI, will now take effect.
The trade diversionary implications of preparing for the Windsor Framework (Enforcement etc.) Regulations 2023, and thus EU regulation 2023/1231, without which it and the other retail movement scheme legislation makes no sense, was brought home with particular clarity in the case of Tesco, through a slide at a recent presentation to retailers. The heading was:
“Packaged Food approach. For products currently moving from GB to NI”.
It said that, under the retail movement scheme, it would be important to restructure to get as many of these goods as possible from the Republic of Ireland to avoid the green and red lanes. Under the heading “Ireland Supply Routes”, the slide said:
“1. More Direct from the EU. 2. Move all common products from the ROI to NI stores. 3. Align some range with the ROI range”.
Of course, this is not to suggest that there will be no use of the green lane but rather that, together with the red lane, the green lane, as defined by various SIs published since August, including the Windsor Framework regulations, is already driving trade diversions. The fact that one can already see that trade diversion is the straightforward result of replacing STAMNI with the retail movement scheme facilitated by the Windsor Framework enforcement regulations, even before they formally come into effect. It demonstrates that, rather than fixing the problem with the Northern Ireland protocol/Windsor Framework, these Windsor Framework regulations have actually helped to call it out, in terms that were always recognised as fatally problematic by the drafters of the protocol/Windsor Framework, such that they justify derogation from it.
Article 16 of the protocol, which is directly effective in UK law, and which many Members of the House of Lords criticised the Government for not triggering ahead of introducing the Northern Ireland Protocol Bill, represents the mechanism to use if the protocol is failing. Failure is defined by Article 16 in the following terms:
“If the application of this Protocol leads to serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade, the Union or the United Kingdom may unilaterally take appropriate safeguard measures. Such safeguard measures shall be restricted with regard to their scope and duration to what is strictly necessary in order to remedy the situation. Priority shall be given to such measures as will least disturb the functioning of this Protocol”.
The interesting thing about the form of words employed here by the drafters is that the diversion of trade is recognised to be such a serious matter that, even if it does not lead to
“serious economic, societal or environmental difficulties that are liable to persist”,
Article 16 can still be triggered, just because it results in a diversion of trade.
Of course, that is not at all surprising, because trade flows that are definitive of a single market are definitive of the economic nationality that underpins the modern nation state. As such, they are of an entirely different constitutional effect to trade flows between economies. They could not be cut away without shaking the very foundation of the polity in question. The trade diversionary implications of the retail movement scheme, as evidenced by Tesco’s presentation, have had a clear impact on the haulage sector, which has experienced a significant reduction in goods travelling from Great Britain to Northern Ireland since the announcement of Windsor, and the replacement of STAMNI with the retail movement scheme that it is the purpose of these regulations to implement.