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Part of the book series: LCF Studies in Commercial and Financial Law ((LCFSCFL,volume 2))

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Abstract

This chapter discusses dispute resolution under the Trade and Cooperation Agreement between the EU and the UK (TCA) focussing on selected issues and outlines some of the problems arising. After providing an overview of the TCA, the chapter presents the salient features of the dispute resolution system provided therein focusing on its fragmentation and complexity, the role (or lack thereof) of the Court of Justice, and the position of private parties. It then discusses the principles of level playing fields and non-regression, dispute resolution under Part Three on law enforcement and judicial cooperation, and the protection of EU values through the essential elements clause.

Takis Tridimas is Professor of European Law at the Dickson Poon School of Law, Kings College London, University of London, United Kingdom and Professor and Nancy A. Patterson Distinguished Scholar, Pennsylvania State University, United States of America

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Notes

  1. 1.

    For a comprehensive presentation, see Fella (2021).

  2. 2.

    Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (OJ 2020, L 29/7).

  3. 3.

    EU-UK Trade and Cooperation Agreement, OJ 2021, L 149/10.

  4. 4.

    Article 1 TCA.

  5. 5.

    See Article 783(2) TCA. Provisional application under Article 218(5) TFEU was necessary given the short period of time between the finalisation of TCA on 24 December 2020 and the end of the transitional period on 31 December 2020 under the WA. This did not give the European Parliament sufficient time to scrutinize and give its consent. Provisional application was set to end on 28 February but was extended to 30 April by a decision of the Partnership Council (Decision No 1/21 of 23 February 2021) as envisaged in Article 783(2) TCA. The European Parliament gave its consent on 27 April 2021.

  6. 6.

    OJ 2020, L 444/2. Decision 2020/2252 came into force on 31 December 2020. See also Council Decision 2020/2023 approving the conclusion of the TCA on behalf of the European Atomic Energy Community (Euratom), OJ 2020, L 444/11.

  7. 7.

    OJ 2021, L 149/2. Decision 2021/689 came into force on 29 April 2021.

  8. 8.

    See Article 218(6) (a)(i) and Article 281(8) TFEU.

  9. 9.

    Article 778 TCA.

  10. 10.

    OJ 2020, L 444/1475.

  11. 11.

    OJ 2021 L 149/2540.

  12. 12.

    The agreement pertains to Cooperation on the Safe and Peaceful Uses of Nuclear Energy and is concluded between the UK and the Euratom, OJ L 150/1.

  13. 13.

    Article 2 TCA.

  14. 14.

    Article 734 TCA.

  15. 15.

    Article 18(2) NCA. A separate dispute resolution procedure is provided which envisages referral to a three member arbitration panel: see Article 21 NCA.

  16. 16.

    Fella, op. cit., p. 20.

  17. 17.

    Article 7 TCA.

  18. 18.

    Article 10 TCA.

  19. 19.

    Articles 8 and 7(2)(g) TCA.

  20. 20.

    Article 745 TCA.

  21. 21.

    Article 748(2) TCA.

  22. 22.

    Under Article 749(3), suspension of obligations is subject to certain conditions and some obligations may not be suspended.

  23. 23.

    Articles 749(11), 749(12) and 750 TCA.

  24. 24.

    CETA, Chap. 29.

  25. 25.

    See Title VIII.

  26. 26.

    TPPA, Chap. 28.

  27. 27.

    RCEP, Chap. 19.

  28. 28.

    See Chap. 22 of the agreement.

  29. 29.

    See CETA, the EU-Singapore Investment Protection Agreement (IPA), the Vietnam IPA and the revised EU-Mexico Global Agreement.

  30. 30.

    Article 735(4) TCA.

  31. 31.

    Article 737(1).

  32. 32.

    Article 737(2).

  33. 33.

    Article 754(2).

  34. 34.

    Article 754(3).

  35. 35.

    Article 754(4).

  36. 36.

    Ibid.

  37. 37.

    Article 754 (5).

  38. 38.

    Article 754(6).

  39. 39.

    See Article 696 TCA.

  40. 40.

    See below.

  41. 41.

    See Article 506 TCA.

  42. 42.

    These exceptions are the following: (a) Article 32(1)–(6) (relating to trade remedies and anti-dumping) and Article 36 (return of illicit cultural property); (b) Annex 12 (Medicinal products); (c) Title VII (small and medium enterprises) of Heading One (trade) of Part Two; (d) Title X (good regulatory practices and regulatory cooperation) of Part Two; (e) The following provisions of Title XI on level playing field: Article 355(1), (2) and (4) (principles and objectives) and Article 356(1) and (3) (right to regulate, precautionary approach and scientific and technical information); Chap. 2 (Competition policy); Article 371 (independent authority or body and cooperation) and Article 372 (courts and tribunals) of Chap. 3 on subsidy control; Chap. 5 (taxation); Article 411(4) to (9) (rebalancing) of Chap. 9); (f) Part Three (Law enforcement and judicial cooperation in criminal matters); (g) Part Four (Thematic cooperation); (h) Title II of Part Six (basis for cooperation); (g) Article 782 (interim provision for transmission of personal data to the UK pending the EU data adequacy decision) in Part Seven on final provisions; (j) the Security of Classified Information Agreement (SCIA). Also, according to Article 735(5), the main DSM does not apply to the Protocol on Social Security Coordination or its annexes in individual cases.

  43. 43.

    Article 735(3).

  44. 44.

    Article 735(4).

  45. 45.

    These include the obligation to (a) uphold the values of democracy rule of law and human rights; (b) respect the Paris Agreement and the United Nations Framework Convention on Climate Change and (c) counter the proliferation of weapons of mass destruction. These obligations are elevated to essential elements of the TCA: see Article 771. Under Article 735(2)(h), the main DSM does not apply to Title II of Part Six which enumerates the principles that form the basis of cooperation between the Parties.

  46. 46.

    See e.g. Article 359(1), Article 359(2), Article 360.

  47. 47.

    Article 4(1) TCA.

  48. 48.

    Article 4(2) TCA.

  49. 49.

    Article 1 TCA.

  50. 50.

    See Annex to Council Decision authorising the opening of negotiations with the United Kingdom of Great Britain and Northern Ireland for a new partnership agreement, Council of the European Union. General Secretatriat of the Council (2020), p.44.

  51. 51.

    For the UK negotiating position, see “Chap. 32: Managing the Agreement” in HM Government (2020), p.18.

  52. 52.

    See Article 322(2) of the EU-Ukraine Association Agreement (OJ 2014 L 161/3). See also Article 264 of that Agreement and Article 6 of Annex XVII on interpretation.

  53. 53.

    Article 726(3) states that the CJEU has jurisdiction to review the legality of Commission decisions imposing penalties on UK individuals or corporations in relation to any claims stemming from Union programmes. However, the UK courts have jurisdiction over complaints alleging that enforcement in the UK is being carried out in an irregular manner. Under Article 726(2), CJEU judgments delivered in application of an arbitration clause contained in a contract in relation to Union programmes is enforceable in the UK in the same manner as Commission decisions, namely in accordance with UK law but without any formality other than verification of their authenticity.

  54. 54.

    See e.g. Haegeman, 181/73, EU:C:1974:41, paras 3–6; Republic of Moldova v Komstroy, C-741/19, ECLI:EU:C:2021:655, para 23.

  55. 55.

    Similarly, it is not inconceivable that the CJEU could be asked to determine the ‘economic and societal impact’ of an alleged failure of the UK to comply with its obligations in the fisheries sector under Article 506 TCA.

  56. 56.

    The Withdrawal Agreement also bestows the CJEU with jurisdiction on specific matters outside the dispute resolution mechanism between the parties envisaged therein. See e.g. Articles 86(2), 87, 158 and 160.

  57. 57.

    See Article 162 of the draft agreement on Withdrawal circulated by the Commission on 19 March 2018, European Commission (2018). In an arrangement reminiscent to that of Article 260 TFEU, the CJEU would also have power to impose as penalty in the event that a Party failed to comply with its ruling: see Article 163.

  58. 58.

    Article 174(1) WA. The same procedure applies also where a question of EU law arises where the arbitration panel is called upon to review whether a measure taken by a Party in default is in conformity with the WA: Article 179(4) WA.

  59. 59.

    Article 174(2) WA.

  60. 60.

    These articles cover mainly cases pending before the CJEU before the end of the transitional period and new infringement proceedings brought by the Commission against the UK for failure to fulfill its obligations under Part Four of the WA (pertaining to the transitional period) before the end of the transitional period.

  61. 61.

    Article 178(2)(b) WA.

  62. 62.

    Article 749(4) TCA.

  63. 63.

    Article 5(1) TCA. This applies without prejudice to Article SSC.67 of the Protocol on Social Security Coordination and with the exception, with regard to the Union, of Part Three of the Agreement. Article SSC.67 requires the Parties to ensure that individuals can invoke the provisions of the Protocol before domestic courts, are able to effectively protect their rights, and can seek an adequate and timely remedy. Part Three provides for law enforcement and judicial cooperation in relation to the prevention, investigation, detection and prosecution of criminal offences and the prevention of and fight against money laundering and financing of terrorism. See Article 522. The proviso that the TCA does not confer rights on persons with the exception, with regard to the Union, of Part Three appears to suggest that private parties may derive rights from that Part which they can assert directly against the Union or its Member States, if the conditions of direct effect are fulfillled. In any event, affected persons could rely on the Charter since the TCA does not affect it. See Article 524(2).

  64. 64.

    Article 5(2).

  65. 65.

    See e.g. Article 525(2) and Article 769 (processing of personal data), Article 689(1) (asset confiscation), and Article 208 (consumer rights).

  66. 66.

    For the EU position, see Article COMPROV.16.

  67. 67.

    See Article 4(1) WA.

  68. 68.

    See Article INST.9 of the EU’s position and Article 33.2 of the UK’s position.

  69. 69.

    See Article 751(2) and Article XII, para 40, of Annex 48 which contains the rules of procedure for dispute settlement.

  70. 70.

    See Article 754(2), above.

  71. 71.

    EU–Canada Comprehensive Economic and Trade Agreement (‘CETA’); (2) EU–Singapore Investment Protection Agreement (‘IPA’); (3) EU–Vietnam IPA; and (4) revised EU–Mexico Global Agreement (‘GA’) The signing date of the EU Agreements are as follows: (i) CETA (30 Oct. 2016); (ii) EU–Singapore IPA (19 Oct. 2018); EU—Vietnam IPA (30 June 2019); (iv) EU—Mexico GA (negotiation concluded on 28 Apr. 2020, to be signed after finalizing the agreement and translating it to all EU languages). See for a discussion, among others, Kim and Winnington-Ingram (2021).

  72. 72.

    See e.g. Joined cases C-120/06 P and 121/06 P FIAMM and others v Council and Commission [2008] ECR I-6513; 247/87 Star Fruit, ECLI:EU:C:1989:58.

  73. 73.

    See Article 207 TFEU and for judicial confirmation, and Opinion 2/15, EU-Singapore Free Trade Agreement, EU:C:2017:376, para 82, Komstroy., para 26.

  74. 74.

    Article 2(1) TFEU.

  75. 75.

    Article 355(1) TCA.

  76. 76.

    See Mariani and Sacerdoti (2021).

  77. 77.

    This applies, for example to Article 355(4), which relates to the Parties commitments to a level playing field, and Article 356(3), which states that, when taking measures aimed at protecting the environment or labour conditions that may affect trade or investment, each Party must take into account scientific information and international standards, both of which are excluded from any DSM.

  78. 78.

    See Article 362 TCA.

  79. 79.

    See e.g. Article 359(1) which states that ‘each Party shall maintain a competition law which effectively addresses’ anti-competitive agreements, abuse of dominance and merger control; The peremptory ‘shall; is also used in Article 359(2), Article 360 on enforcement, and Article 361(2) on cooperation.

  80. 80.

    See e.g. Article 372 which imposes concrete obligations on each Party to provide for judicial remedies in the field of subsidy control but is exempted from any DSM.

  81. 81.

    See Article 375.

  82. 82.

    See Article 408.

  83. 83.

    See Article 735(e).

  84. 84.

    See Articles 389, 391, and 407.

  85. 85.

    See Article 387(2) in relation to labour and social levels of protection and Article 391 in relation to environment and climate.

  86. 86.

    See Article 384.

  87. 87.

    See to this effect Articles 385 and 408.

  88. 88.

    See Article 409(3) and (4).

  89. 89.

    See Article 746 TCA.

  90. 90.

    Article 409(9).

  91. 91.

    Article 409(16).

  92. 92.

    Article 410.

  93. 93.

    See evidence by Hestermeyer (2021).

  94. 94.

    Article 411(2).

  95. 95.

    Article 522(1) TCA.

  96. 96.

    Fella (2021).

  97. 97.

    See Article LAW.OTHER.136 of Draft text of the Agreement on the New Partnership with the United Kingdom, 18 March 2020, UKTF (2020) 14, https://ec.europa.eu/info/sites/default/files/200318-draft-agreement-gen.pdf. Article LAW.OTHER.136(1) made cooperation conditional upon the UK’s continued adherence to the ECHR and Protocols 1, 6 and 13 thereto, and giving continued effect to these instruments under its domestic law. Article LAW.OTHER.136(2) stated that, in the event that the UK abrogated the domestic law giving effect to the above instruments or made amendments to the effect of reducing the extent to which individuals could rely on them before domestic courts, the Title on law and enforcement and cooperation was to be suspended.

  98. 98.

    See Ministry of Justice (2021).

  99. 99.

    See Articles 695 et seq.

  100. 100.

    Cf R (on the application of EM (Eritrea)) v Secretary of State for the Home Department [2014] UKSC 12, per Lord Kerr, para 42.

  101. 101.

    Article 763(1).

  102. 102.

    Article 764.

  103. 103.

    Article 765.

  104. 104.

    Article 766.

  105. 105.

    Article 767.

  106. 106.

    Article 768.

  107. 107.

    Article 769.

  108. 108.

    Article 770.

  109. 109.

    Article 771 and see preamble, recital 1.

  110. 110.

    Article 772(3).

  111. 111.

    Article 772(4)

  112. 112.

    Fella, op. cit.

  113. 113.

    This is the case in relation to safeguard measures: see Article 773(5).

  114. 114.

    Article 773(1).

  115. 115.

    Id.

  116. 116.

    Article 773(2) and (3).

  117. 117.

    Mancini and Keeling (1994).

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Tridimas, T. (2024). Brave New World: Dispute Resolution Under the EU–UK Trade and Cooperation Agreement. In: Heidemann, M. (eds) The Transformation of Private Law – Principles of Contract and Tort as European and International Law. LCF Studies in Commercial and Financial Law, vol 2. Springer, Cham. https://doi.org/10.1007/978-3-031-28497-7_3

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