The Great Repeal Bill & Triggering Article 50: What Might Brexit Mean for Fashion Business?

Theresa May, the first British prime minister to be featured in US Vogue, wearing a coat and dress by LK Bennett for an article in the April issue of American Vogue. Photo credits | Portrait photographer @Annie Leibovitz.

Theresa May has triggered Article 50. Britain's departure from the EU is imminent and marks a "historic moment from which there can be no turning back," says May. These impending changes have thrown us into particularly uncertain times. The UK has now entered a two-year-long period of negotiations, and question are being raised as to what the UK's leaving the EU means for both the creative industries and the UK's future creative economy? In a 100 plus page parliamentary report (published last week), launched by the House of Lords EU Internal Market Committee focused on the impact of Brexit on the non-financial services sector, It said these industries represented around a third of UK exports, at £162bn and could possibly be under threat.

Added to that, the fashion industry is a significant contributor to the British economy. The British fashion industry contributes the equivalent of 1.5% of the GDP to the UK and £28.1bn GBP and its GVA contribution grew 4.7% last year compared to the economy’s 2.2 and supports 880,000 jobs "is heavily reliant on international trade, especially with Europe, the majority of our exports to non-EU markets, especially Japan and China." (BFC Written evidence)

The report concluded that: “Creative industries will need a comprehensive agreement on the protection of intellectual property rights. For example, in fashion, the continued protection of Unregistered Community Designs will be important to ensure that fashion designers are still protected when showing their designs for the first time in the UK. Without such protections, the viability of events like London Fashion Week could be called into question, posing a direct threat to jobs in the UK and, more broadly, to the standing of the UK’s fashion industry.”

"In parliamentary report published last week, it was noted that the UK’s departure from the European Union could call into question “the viability of events like London Fashion Week" as a platform to promote British businesses due to issues over intellectual property rights."

The report noted that: “the protection afforded by Unregistered Community Designs was particularly important to the fashion industry, because via this system all designs were protected automatically, thereby saving on the costs of registering all designs across a portfolio (which can be substantial).” After the UK’s withdrawal, the report raised particular concerns that UK designers would only be able to benefit from the EU’s protection for registered and, more importantly, unregistered designs, if the “relevant designs are first disclosed in the EU.”

The British Fashion Council added that asking designers to register design rights in the EU before a fashion show would be “costly across an entire portfolio, making that option uncompetitive” and it was also felt that the domestic protections for intellectual property were weaker than those in the EU. The Design Council said that the UK’s equivalent to the UCD right was “not an equitable right for UK designers”, because it did not protect novel surface design (for example, the look of a shirt rather than how that shirt was made), and it was felt that a loss of UCD rights would “leave a gap in protection for our design and fashion businesses.”

"Many designers are concerned about how Brexit will impact the international nature of their business operations."

The report also addressed free movement of persons (British and EU nationals) and the importance of priorities for a UK-EU Free Trade Agreement.  Last year, the European Union accounted for 74 percent of UK exports, making it Britain’s biggest export market for textiles and apparel, and many designers are concerned about how Brexit will impact the international nature of their business operations. In terms of negotiation and safeguards leading up to the UK's exit - the importance is to raise awareness of designers rights and ensure that designers and the industry are not severely disadvantaged in comparison to our European counterparts.

In terms of how the government will navigate these transitionary changes - a white paper explaining how the UK will legislate post Brexit, has been published. It lays out the general terms of what the Great Repeal Bill, and we also wanted to clarify some important points below (courtesy of the Institute For Government):

What is the Great Repeal Bill?

At the 2016 Conservative Party Conference, Theresa May announced that her government would introduce a Great Repeal Bill to end the supremacy of EU law in the UK, a crucial part of leaving the European Union.

The Government released a White Paper for the bill on 30 March 2017.

What will it do?

According to the Government’s White Paper, the bill will do three things:

Repeal the European Communities Act 1972. This legislation provides legal authority for EU law to have effect as national law in the UK. This will no longer be the case after Brexit.

Bring all EU laws onto the UK books. This means that laws and regulations made over the past 40 years while the UK was a member of the EU will continue to apply after the Prime Minister triggered Article 50 on 29 March.

Create powers to make secondary legislation. Technical problems will arise as EU laws are put on the statute book. For instance, many EU laws mention EU institutions in which the UK will no longer participate after Brexit, or mention “EU law” itself, which will not be part of the UK legal system after Brexit. There will not be time for Parliament to scrutinise every change, so the bill will give ministers some powers to make these changes by secondary legislation, which is subject to less scrutiny by MPs.

If the UK is leaving the EU, why is it keeping laws made by the EU?

EU law covers areas such as environmental regulation, workers’ rights, and the regulation of financial services. Without the Great Repeal Bill, when the UK leaves the EU, all these rules and regulations would no longer have legal standing in the UK, creating a ‘black hole’ in the UK statute book and leading to uncertainty and confusion. By carrying EU laws over into UK law, the Government plans to provide for what David Davis, Secretary of State for Exiting the EU, calls ‘a calm and orderly exit’ from the EU, while giving the Government and Parliament time to review, amend or scrap these laws in future.

What did we learn from the White Paper?

EU Law

The White Paper commits to ending the supremacy of EU law in UK law. It will no longer be the case that every law passed in Westminster has to be compatible with those passed in Brussels.

The document also says that past judgements of the European Court of Justice (ECJ) will be downgraded in status after Brexit.

ECJ judgements will have no role in the interpretation of laws passed by Parliament after the UK has left the EU.

Pre-Brexit ECJ judgements will continue to have some role in interpreting pre-Brexit EU law, but the UK Supreme Court will be able to overrule these decisions in some cases.

The role of post-Brexit ECJ judgements on pre-Brexit laws is still unclear.

Delegated Powers

The White Paper argues that a “prohibitively large amount of primary legislation” would be required to make all the necessary changes to the body of EU law.

Therefore, it will “provide a power to correct the statute book, where necessary, to rectify problems occurring as a consequence of leaving the EU”.

The Government acknowledges there will need to be some constraints on how ministers can use secondary legislation to change the law.

However, the White Paper is vague about what these constraints will be. For instance, the White Paper acknowledges that ministers’ new powers will have to be time limited, but does not discuss what these time limits will be.

The Government is seeking a “discussion between Government and Parliament as to the most   pragmatic and effective approach to take” on powers.

When will it come into force?

The plan is for the bill to complete its passage through Parliament well before the point at which the UK leaves, but for it to include ‘commencement provisions’ enabling ministers to bring it into force at a moment of their choosing. The Government says that the bill will come into force ‘from the day we leave the European Union’. This will be on 29 March 2019, although if Article 50 negotiations are extended, it may be later.