BLC Obiter Dicta Edition 11

Edition 11 September 2016

1

Index of Articles

114

BREXIT and Other Constitutional Issues

3

Issues of National Significance

36

EU and International Issues

71

CEEMC and BLC Updates

108

A number of articles in this edition of Obiter Dicta were prepared prior to the UK electorate’s momentous decision to leave the European Union. Whether the UK leaves or remains in the EU, joins EFTA, or something else, there has rarely been a more important time in the last 50 years to be aware of English law and to engage in a multi-national sharing of ideas and legal knowledge. As such, Obiter Dicta has a new challenge to enable BLC students and alumni to collaborate and share their special knowledge of UK law, EU law and the law of their own Member States.

For 25 years, the BLC has sought to foster an interest and understanding of English law across the Central and Eastern European region, and for the last 8 years, Obiter Dicta has given BLC students the opportunity to write and publish on their legal interests. In this edition, we have plenty to offer readers: there is an interview with Iain Morley QC, the eminent criminal barrister and author of „The Devil’s Advocate”, several diverse articles dealing with both ’BREXIT’ specific issues and other national constitutional problems, as well as articles looking at aspects of national and European law within the fields of employment law, company law, spatial planning, criminal law and 2 much more. We hope you enjoy it, and please, keep in touch!

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The BLC year in Obiter Dicta RECRUITMENT for the new year in the British Law Centre has started in all our centres. We hope that our students and alumni will encourage their friends and

BLC NEWS AND EVENTS

colleagues to join us in 2016-2017 - more details as always can be found at the dedicated BLC web site (britishlawcentre.co.uk/courses).

BLC 25TH ANNIVERSARY CONFERENCE: It will be an exciting year for the British Law Centre as we will be celebrating our 25th anniversary with a conference on European Union law to be held on 8 September 2017 at the Faculty of Law, Cambridge University.

As well as a special line-up of speakers to include members of the EU Court of Justice and Cambridge law faculty, we will be calling for papers from BLC students/ alumni who might wish to participate and present at the conference. More details on this ‘anniversary competition’ will follow in 2017 in a dedicated anniversary Edition of OD, but to make sure you don’t miss your opportunity to join us in Cambridge, you can write to us now at editorial@britishlawcentre.co.uk and ask to be added to the mailing list.

ANNOUNCEMENTS It has been a special year for some of our colleagues and friends to whom we pass our warmest congratulations and wish every success in their new positions: Professor Arkady Rzegocki, the BLC Local Programme Director for our UJ centre in Krakow was appointed as the new Polish ambassador to the United Kingdom in August 2017. Ms Krystyna Kowalik-Bańczyk (BLC alumni from Gdansk centre) was appointed a judge to the General Court of the EU on 1st September 2016. Dr Alexander Kornezov (regular member of CEEMC judging panel) was appointed a judge at the European Civil Service Tribunal in March 2016. Carsten Zatschler (recurring member of CEEMC judging panel) was appointed the Head of Legal Services at the EFTA Surveillance Authority.

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In this section contributors are given the opportunity to write about UK and international constitutional law issues and the elephant that is BREXIT!

CONSTITUTIONAL AND BREXIT ISSUES

British Constitutional Norms and the Primacy of EU Law after the HS2 Judgment Aleksander Makal, BLC Student, Bratislava Centre

In January 2014 the British Supreme Court gave judgement in R (HS2 Action Alliance Ltd) v Secretary of State for Transport [2014] UKSC 3. The ruling featured, inter alia, an exciting excursus by Lords Neuberger and Mance on the nature of

British constitutional ‘instruments and principles’ and the necessity to adopt a more nuanced understanding of the hierarchy of constitutional norms. Following the decision in Thoburn v Sunderland City Council [2002] (Metric Martyrs case), the situation at common law seemed settled: the doctrine of implied repeal had been qualified and was said not to apply where it would lead to abrogation by an ‘ordinary’ statute of earlier ‘constitutional’ legislation. Thus, it was argued, a

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balance was struck between ‘the proper supremacy of Community law and the proper supremacy of the UK Parliament,’ and the UK was said to enjoy ‘most of the benefits of a written constitution,’ while preserving ‘the flexibility of [the] uncodified constitution.’ Even though this proposition originated in a lower court, it put down some roots in British constitutional thought and it is only now, confronted with the HS2 judgement, that we begin to see a hierarchy of (constitutional) norms more complex than that originally envisaged by Laws LJ. In the HS2 case, the Supreme Court was asked to consider whether the decision-making process adopted by the Government for the purposes of the planned high-speed connection between the capital and the North would fulfil the requirements of the Environmental Impact Assessment Directive (2011/92/EU). The Directive codifies earlier Community legislation and sets minimum

requirements as to the degree of public participation in the discussion of projects likely to have considerable impact on natural environment. The main circumstance which gave rise to the discussion of potential constitutional problems was the fact that the decision was to be taken not by an administrative body, but by Parliament itself. The appellants challenged the legality of this measure and failed: the High Speed Rail (London-West Midlands) Bill is currently scheduled for a second reading in the House of Lords.

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The appellants argued that the EIA Directive, as construed by the CJEU, required national courts to deny validity to legislative enactments which failed to fulfil the Directive’s objectives, including, most importantly, a satisfactory degree of public participation in the discussion of projects akin to the controversial HS2 railway. Such denial would normally amount to disapplying the national legislation found contrary to the relevant EU instrument in accordance with the doctrine of supremacy of EU law as first acknowledged by British courts in R (Factortame Ltd) v Secretary of State for Transport. In the HS2 case, however, the stakes seemed higher as it was contended by the appellants that the substantive provisions of the Directive required the Supreme Court to critically

assess the adequacy of the legislative process itself, a step necessarily contrary to Article 9 of the Bill of Rights which expressly prohibits any court from questioning ‘the Freedome of Speech and Debates or Proceedings in Parlyament.’ Had the Directive required such judicial review of Parliamentary debates, the Court would have been faced not with a clash of ordinary and constitutional statutes, as was the case in Factortame and the Metric Martyrs, but with a conflict between two constitutional enactments (the Bill of Rights 1689 and the European Communities Act OBITER

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1972). Lords Neuberger and Mance

suggested

that,

should such a conflict ever materialise, it would be ‘for United Kingdom law and courts to determine that there may be fundamental principles, contained

whether in

other

constitutional instruments or recognised at common law, of which Parliament when it enacted the European Communities Act 1972 did not either contemplate or authorise the abrogation.’ Such a suggestion flies in the face of the contention of the ECJ in Internationale Handelsgesellschaft [1970], where it held that ‘the validity of a community measure or its effect within a Member State cannot be affected by allegations that it runs counter to either fundamental rights as formulated by the constitution of that State or the principles of a national constitutional structure.’ Prof. Mark Elliot has suggested that the Supreme Court judges have now introduced the idea that EU law’s position within the UK constitutional system is not to be determined solely by reference to the 1972 Act, ‘but also by reference to other features of the domestic constitutional landscape with which EU law might conflict, and which might therefore constrain the domestic applicability of constitutionally-suspect EU norms’ (Reflections on the HS2 Case). If this is the case, one may well conclude that constitutional norms do not constitute a uniform class, but are themselves varied in so far as some can be said to (be able to) repeal others.

It should be noted that Lords Neuberger, Mance, and Reed were careful to phrase their discussions

of these constitutional issues in the subjunctive as all of their remarks were strictly obiter dicta. In the end, the Court managed to steer clear of the perils of judicial review of Parliamentary business by interpreting (as a matter of EU law) the HS2 Bill to fall outside the scope of the EIA Directive.

Nonetheless, the opinion expressed by the Lords that there may be constitutional principles untouched by the supremacy of EU law as advocated by the CJEU remains intriguing and relevant not only in the context of the UK constitution debate.

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The Polish Constitutional Tribunal crisis Klaudia Zawiślak BLC Alumnus, Warsaw

According to Article 194 (1) of the Constitution of Poland “the Constitutional Court shall be composed of 15 judges chosen individually by the Sejm for a term of office of 9 years from amongst persons distinguished by their knowledge of the law. No person may be chosen for more than one term of office.” On 25 June 2015 the Sejm (one of the Chamber of the bicameral Polish Parliament) adopted the Act on the Constitutional Tribunal which stated, inter alia, that candidatures for new judges of the

Constitutional Court shall be submitted within 30 days from the Act’s entry into the force. The Act entered into the force on 30 August 2015 and on 8 October 2015 five new judges were elected. They were supposed to replace three judges whose tenures were to terminate on 6 November 2015, and two other judges whose tenures were to terminate on 2 and 8 December 2015. However, the newly elected President of the Republic of Poland refused to administer the oath to the elected judges and due to that fact they did not become entitled to assume their office.

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After the general election in October 2015 the new government in Poland has pushed through many legal changes. One of the biggest changes relates to the Constitutional Tribunal. On 25 October 2015 the new Sejm stated that the previous election of Constitutional Tribunal judges was incorrect in law and on 2 December 2015 five new judges were elected. The President administered the oath to these judges just a few minutes after midnight. Moreover, the new Parliament proposed amendments to the Act on the Constitutional Tribunal. The new regulation, inter alia, states that all verdicts need to be approved by a two-thirds majority (in contrast to the previous requirement of a simple majority). This rule has led to fears that it will be more difficult for the government’s opponents to question new legislation because more of the judges composing the tribunal are now connected with the winning political party. A situation in which the Constitutional Tribunal has lost its objectivity would potentially

lead to a state of legal imbalance in Poland.

The Constitutional Tribunal announced a judgment on 3 December 2015 concerning the case of the election of the five judges by the previous Sejm in June. The Tribunal stated that it was constitutional to choose three of the five judges (those who were supposed to replace the judges whose tenure expired in November) and unconstitutional to choose the remaining two judges (who were to replace the judges whose tenure expired in December). Also, the Tribunal stated that it was an obligation of 9

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the President to administer the oath to the judges, who were elected on 8 October 2015. Furthermore, on 9 December the Tribunal held a hearing in the case concerning the amendment of the Act on the Constitutional Tribunal and the constitutionality of the new Sejm electing the five judges in December.

There were also many others legal issues arising that were related to the procedures which were claimed to have been violated during the process of the Sejm’s election of the new judges in December.

According to Article 190 (1) of the Polish Constitution, the Court's judgements “shall be of universally binding application and shall be final.” Moreover, Article 190 (2) of the Constitution states that judgements of the Constitutional Tribunal “shall be required to be immediately published in the official publication in which the original normative act was promulgated.” However, the Prime Minister, who is responsible for publication of the verdicts of the Tribunal, refused to publish the judgment of the Constitutional Tribunal announced on 9 December 2015. That decision was justified on the grounds that the verdict was not a judgment but just a point of view expressed by some of the Tribunal’s judges.

In December 2015, the Minister for Foreign Affairs of Poland requested the opinion of the European Commission for Democracy through Law on the constitutional situation arising from the amendments to the Polish Law on the Constitutional Tribunal. The European Commission for Democracy through 10

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Law, also called the Venice Commission, is an advisory body of the Council of Europe composed of independent experts in constitutional and international law, judges, and members of national parliaments. The Commission works mainly in three areas: democratic institutions and fundamental rights, constitutional or ordinary justice and elections, referendums and political parties. The opinion on the Polish constitutional crisis was adopted by the Venice Commission on 11 March 2016.

Generally, the Commission presented a negative

opinion

concerning

the

changes to the functioning of the Polish Tribunal.

In

its

conclusion

the

Commission states that “as long as the Constitutional Tribunal cannot carry out its work in an efficient manner, not only is the rule of law in danger, but so is democracy and human rights.” The Commission also held that the efficiency of the Tribunal is in danger because the new regulations may lead to a serious reduction of the speed with which the Tribunal can dispatch its business. The

Commission concludes that “crippling the Tribunal’s effectiveness will undermine all three basic principles of the Council of Europe: democracy – because of an absence of a central part of checks and balances; human rights – because the access of individuals to the Constitutional Tribunal could be slowed down to a level resulting in the denial of justice; and the rule of law – because the Constitutional Tribunal, which is a central part of the Judiciary in Poland, would become ineffective.” If there will be no change to the situation affecting the Tribunal, the most important Constitutional Court will become ineffective as the guardian of the Polish Constitution.

It has to be emphasised that for the first time in democratic Poland the Constitutional Tribunal has

become the object of weak-legal changes, which have destabilized its functioning, and any future decision-making. It is hard to find any explanation that will account for this situation because the rule of law is the basis for any civil and democratic society and it had been respected in the democratic government Poland until the current controversy. What will be the future of the Polish Constitutional Tribunal? This is hard to predict. For now, the only thing which can be said is that the crisis poses great dangers, even if many people do not perceive the seriousness of the risk.

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The Butterfly effect!

(a question of timing and context-a review of the Factortame saga) Denise Ashmore BLC Course Director

butterfly effect noun …………(with reference to chaos theory) the phenomenon whereby a minute localized

The result of the recent UK referendum on European Union (EU) membership revealed a far from ‘United’ Kingdom (UK) with a slight majority of 52% voting in favour of leaving the EU from the 72.2% of UK registered voters who cast a vote. When perceived from the perspective of citizens from EU countries with written constitutions setting out in detail the complex stages required before any constitutional change, including; a set threshold percentage required for any vote on constitutional changes, rules on procedure and effect of referendums and the ability to refer questions of interpretation to a Constitutional court, the result might appear rather slapdash in the extreme. What happens next, who decides the next steps to take, what role will the UK Parliament play, does the

referendum require parliamentary approval are only a few of the basic questions that now arise, little surprise then that the immediate consequence of the vote on this extraordinarily vague question was followed by political, legal and economic furore.

A closer scrutiny of the weeks leading up to the vote and the political chaos that followed would no doubt form an excellent case study for a social scientist/ anthropologist who might not only consider the actual issues and arguments that most influenced the voting public but would certainly also highlight the central role played by many individuals’ perceptions of significant issues such as British

sovereignty and the impact of EU migration (it matters little whether those perceptions were correct, exaggerated or inaccurate). There is no doubt that many were not prepared to waste that unique opportunity to express unrest, dissatisfaction and/or to simply press for a change.

The ‘no’ vote therefore left the United Kingdom (and consequentially the EU) in a state of political limbo without plan, direction or timetable and also brought the primary political parties to a state of 12

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internal revolt and disarray. Its legal implications however are even more interesting, particularly for lawyers seeking appropriate constitutional precedents or procedures. (Other articles in this edition will take up this theme…)

What a contrast only two months later to see an apparently resplendent ‘United’ Kingdom, ruling the waves of sport when its athletes took the country to an historic second place in the Rio 2016 Olympics following a well mapped, funded plan of dedicated sponsorship and support aimed primarily (and some argue cynically) at sports where athletes had a chance of a medal win. A plan which took the UK from 36th place in 1996 to an amazing 2nd place in 2016, to finish between the USA and China (populations respectively 321 million and 1.4 billion compared with the UK population of 65 million).

Let us pause for a moment and consider both the Referendum and the Olympics from another context and we might see a different picture.

What if the June referendum vote had set out a choice of alternatives to the current membership to the EU rather than a simple ‘in or out’ vote, options might have included a) full withdrawal from EU, b) associated membership with access to the single market c) withdrawal from the European Convention on Human Rights.

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Or what if the Olympic medal table order had been published according to the number of medals won based upon GDP or population only rather than number of medals won.

Perspectives and context therefore matter greatly and so at a time of extraordinary constitutional challenges for the UK, I would like to take the opportunity to turn the spotlight back to a key moment in the development of EU and UK constitutional jurisprudence and to a landmark case which resonates for national and EU lawyers alike. It centres around a dispute between the UK government and Spanish fishermen about the right to fish in UK waters… it is central to the development of the EU doctrine of State Liability and will remind us that jurisprudence cannot be divorced from its factual context, and that precedents are not created in theoretical isolation but are often a balancing act between a range of competing interests, influences and effects.

R (Factorame Ltd)-v- Secretary of State for Transport (March 1989-November 2000) Five different legal stages can be identified in this celebrated case which spanned a period of 11 years.

It involves weighty issues such as Parliamentary sovereignty, the Court of Justice’ doctrines of direct effect and state liability, the implementation and impact of the EU Common Fisheries policy and also

how elements of English company law combined with national procedural law would affect and be affected by the fisherman’s claim.

In EU textbooks you are told that this involves a case taken against the UK government by one company of Spanish fisherman who claimed a breach of European Community law (EC) by a UK government which acted to preventing the fishermen exercising their right of free movement. This is the simple version of the facts that would be recognised by most law students. How then did this case impact so greatly upon British Constitutional law at the time?

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THE FACTS The seeds of the dispute could be seen in 1970, before the UK became an EC member, with the founding of the Common Fisheries Policy which aimed:a) to create free access to waters of all member states to achieve a common market for fisheries products and b) to enable the fishing industry to modernise with the help of EU strategic funding support.

From 1976 onwards (the UK having joined the EEC in 1973) a number of agreements were put in place

extending national fishing zones to 200 nautical miles from national coastlines. At this time Spain was not an EC member but was a party to a bilateral fisheries agreement with the EU providing its citizens limited rights to fish in EU waters. Spain possessed the largest European fishing fleet at this time. It was also a time when there was concern at the threat of overfishing with both the EU and UK putting in place measures to protect their fishing stocks by means of national fishing quotas and total allowable catches. An environmental and economic balance appeared to have been achieved.

It is at this point that English company law raises his head, as it enabled some Spanish boats to avoid the national limitations restricting them from fishing in the UK national waters by effectively ‘taking the colour of UK boats’ . This meant in practice that they would set up as a UK domiciled company so as to take advantage of the rather lax requirements on fishing vessel registration imposed by the Merchant Shipping Act 1894 (1894 Act). The 1894 Act included provisions preventing non UK nationals from registering boats as under UK ownership but there was no corresponding limit upon the registration of boats by a UK company, whether or not, as in the case of Factortame Ltd, all its directors were foreign nationals with a non UK domicile. BLC 2nd year students will no doubt recall the specific English company law rules on the corporate veil preventing attribution of nationality to a company by looking at its shareholders or owners.

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From 1980 onwards therefore Factortame ltd and some other

96 businesses

16

(directors and

shareholders also mainly Spanish nationals) set up UK companies and re-registered their existing Spanish boats under the 1894 Act or acquired new boats in the UK to form a fleet of some 95 vessels.

Although in practice these boats landed and sold their catches in Spain not in the UK they were still treated as UK national boats so could legitimately catch fish within UK waters and set their catches set against the UK fishing quota, to the considerable disadvantage of the UK fishing industry, a practice called ‘quota

hopping’.

Although this practice was challenged before the UK courts by the British Government and on a preliminary ruling before the EU Court of Justice, the British government lost both cases (Agregate C 3/87 and Jaderow C216/87) and so it was decided that the matter required statutory intervention, leading to the enactment of a

revised Merchant Shipping Act in 1988 (the 1988 Act) which with the linked Merchant Shipping (Registration of Fishing) Regulations set a new registration standard which required vessels to have a ‘genuine and substantial connection’ with the UK before they could take the UK colours which could be proved by satisfying the following three conditions:the vessel must be British-owned; the vessel had to be managed and its operations had to be directed and controlled from the UK; and any charterer, manager or operator had to be a qualified person or company. A "qualified person

or company" was a person who was a British citizen resident and domiciled in the UK or a company which was incorporated in the UK and had its principal place of business there having at least 75% of its shares owned by, and at least 75% of its directors being, "qualified persons".

All UK vessels were now required to re-register under the 1988 Act by March 1989, at which time the earlier licences would expire. Naturally Factorame Ltd and the other Spanish owned companies would not be able to satisfy the new requirements.

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In 1985 Spain also acceded to the EC so was no longer bound by its earlier bilateral fishing agreement.

THE ISSUES Let us pause at this point to review a number of legal issues which required consideration. 

There was existing company law jurisprudence regulating the limited situations when it would be possible to pierce the corporate veil for the purposes of assessing national identify of a company through its shareholders and the Merchant Shipping Act was providing a further statutory exception.



It is a fundamental principle of EC/EU law that there should be no discrimination on the grounds of nationality and that direct discrimination could only by justified by exemptions/derogations set out in the primary EC/EU treaties although the Court of Justice to the European Communities (ECJ) had proved more receptive to recognising justifications in cases of indirect discrimination.



Parliamentary sovereignty forms the backbone of the British constitution and it appeared that Parliament had expressly legislated in a way that would put them in direct conflict with the EC principle of discrimination.



The company law loophole that had been exercised by the Spanish fisherman raised an issue

which continues to challenge the EU to the present day, is this ‘abuse’ of the law or rather simply appropriate application and ‘use’ of the law One might have some sympathy for the British government. Looked at morally, the actions of the Spanish entities such as Factortame Ltd could not be justified as they were arguably exploiting a situation to the

economic and social detriment of the national

fishing industry and regions of the country which were

reliant upon this trade. It could be argued that the UK government were doing no more than acting to protect their citizens when faced with a serious challenge to the social, economic and regional UK interests brought about by an unfair EC regulation.

However was it solely EC/EU law that brought about this situation?

Firstly; the government’s choice to link the system of allocation of licences and quotas to that of UK vessel registration, rather than treating them as separate issues, in effect parcelled the vessels and linked rights together in one nice neat package. There was no EC obligation requiring them to do this 17

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but it no doubt enhanced the attractiveness of buying a UK registered vessel for any EC buyers, who could also acquire automatic rights to fish in UK waters (it should be added that this so-called loophole was not only used by Spanish fishing fleets but also by a number of Dutch companies raising the number of foreign owned fishing boats to some 150).

Secondly; there was no requirement to land catches in UK waters at UK ports so enabling the fish to be landed elsewhere in the EC/EU. Thirdly; the definition of ‘qualified person’ set out the 1988 Act need not have been linked so directly to issues of nationality.

In short there were a number of other actions that could have been taken that would have been less confrontational but might have achieved the desired effect.

Instead the UK government, having taken prior legal advice, took an approach which might seem to have parallels in 2016 , that of ‘using a sledgehammer to crack a nut’, by drafting a law which would conflict with a fundamental principle enshrined in the primary treaties, that of non-discrimination (now contained in Article 18 of the consolidated Treaty on the Functioning of the European Union (TFEU)).

This set the scene for the legal battles that followed with its consequent impact upon British constitutional law.

THE COURT CASES In previous centuries the historical battles waged between England and Spain are things of legend and Hollywood myth. In the 20th century the battle was to be fought in court rooms in London and Luxembourg.

The Spanish fisherman took the first shot seeking

an

an

interim

injunction

declaring that the UK had breached directly effective EC rights, specifically the right not to be discriminated against on the grounds of nationality (then article 7 of the Treaty of Rome), the right of

individuals

establish 18

and

themselves

companies in

to

business

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anywhere in the EU (then articles 43–48 ECT), as well as a declaration that the Secretary of State could not cancel its registrations under the 1894 Act. Battle was joined and continued for a number of years and through a number of linked cases, each of which raised different issues which impacted both nationally and at the level of the EU. Let us consider each issue and its importance separately.

Legal Issue 1- could the court grant an interim injunction against the Crown

This type of remedy was available in most EU legal systems, however both the UK Court of Appeal and the House of Lords had concerns, stating:they did not have jurisdiction to issue an injunction in a case of a putative claim against the UK which had yet to be upheld under European Community law as this would effectively ‘confer rights directly contrary to Parliament's sovereign will’ by effectively disapplying the 1988 Statute and that in any event they had no jurisdiction under national law to grant such an interim injunction against the Crown.

The House of Lords (as a court against which there was no national remedy) referred the issue to the Court of Justice under the Art 234 TEC preliminary ruling procedure.

In June 1990 a court of 11 judges in Luxembourg found that a national court, in fact, has a duty to grant interim relief to safeguard alleged Community rights of individuals until the decision of the ECJ on the interpretation of Community law is available, and where a rule of national law would deny such relief, to set aside that rule. It stated that ‘the basis of such a duty lies in the nature and object of directly effective Community law rights which are intended to be fully effective throughout the EU, and where, in order to safeguard such a right, it is necessary to grant interim measures, a national court must do so. This is especially true where a national court is awaiting a clarification or interpretation of the right claimed by the ECJ’ Hence when the case was returned to the House of Lords in November 1990, Factortame Ltd was granted its interim injunction pending the outcome of the primary case, Lord Goff in his judgment indicating that the court had been influenced by the indication from the ECJ that the claimant’s arguments on EC had ‘considerable force’.

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It appeared that the Crown no longer remained immune from interim injunctions when faced with EC claims, would this also now enable such injunctions to be claimed when the breach claimed was one of national law?

The judgment formed the basis of innumerable articles, with Sir William Wade describing it as ‘revolutionary’. It should be noted however that the case was not presented by the government’s lawyers as a direct challenge to Parliamentary supremacy, considering rather that the 1988 Act had not been a direct attempt to conflict with primary EC law but rather an attempt to interpret, so sidestepping a potential constitutional issue for the national court of whether EC law was supreme. .

Legal Issue 2 - was the Merchant Shipping Act 1988 compatible with European Community law

Now for the primary issue on compatibility, the Court had little difficulty in following their Advocate General’s opinion in finding that "it is for the Member States to determine [...] the conditions which must be fulfilled in order for a vessel to be registered in their registers and granted the right to fly their flag, but, in exercising that power, the Member States must comply with the rules of Community law."

In particular, the conditions for registration should not constitute obstacles for nationals of one Member State to establish themselves in business in the territory of another Member State (the freedom of establishment), nor should they discriminate on the basis of nationality’.

Therefore the Court not only found the nationality requirements in the 1988 Act to be discriminatory but also that it was contrary to Article 43 EC as a restriction on the freedom of establishment and that it violated articles 12 and 221 EC. It also took the view that the residence and domicile conditions were also a breach of Article 43. The only requirement indeed which the court found acceptable was that for the business to be managed and its operations directed from the UK. The UK government had based its arguments on the history of the Common Fisheries Policies and the abuse by the foreign fishing fleets rather than seeking to concentrate on individual restrictions and the needs of the fishing industry and related industries. Certainly the latter would have been less likely to contravene EC law than an argument based upon nationality and residence conditions.

Legal Issue 3 – the question of compensation?

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The timing now becomes very important, with two shots fired successfully, Factortame now sought compensation, what compensation could be claimed?

Although the primary treaty was quiet on this issue, the ECJ had recently started to develop its principle of state liability in the case of Francovich (C6/90) decided in November 1991. In early 1992 a third reference is made to the ECJ, this time by the English High Court, which seeks to clarify and review the conditions to be satisfied for a claim of state liability to succeed. As a similar question has been raised by the German Federal Court in the case of Brasserie du Pecheur, the two cases, C46/93 and C 48/93, are duly joined together and a judgment follows some 4 years later in 1996.

The judgment itself has been exhaustively analysed by academics in EU textbooks and articles and so

little need to be added here save the comment that all Member States took the opportunity to intervene in the case, the majority arguing that the right to damages should be reviewed and even reversed. It is perhaps interesting that the UK appeared to follow a different beat, accepting in principle that the right to damages should exist and concentrating rather upon damage limitation to make the threshold conditions impossibly high. The ECJ did indeed reaffirm their earlier judgment 21

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whilst adding the additional threshold condition that the national court need to be satisfied of the existence of a ‘sufficiently serious breach’ and this would only be the case if the breach was both manifest and grave. In essence however this returned the battle to national courts, requiring claimants to submit their arguments to this new condition and to seek findings of fact against the national governments.

Legal Issue 4- application of ECJ interpretation by the National court

The national court therefore is now required to apply the ECJ’s interpretation to our case. Factortame Ltd itself, no doubt extremely content with its success to date and full of confidence, decided to not only seek compensation for their actual losses but also wished the court to make an award of exemplary damages so as to effectively ‘punish’ the government for their acts. The UK government in contrast argued that its reliance upon legal advice at the time of legislating was enough to prevent any breach being either ‘manifest’ or ‘grave’.

Although the court did appear to accept that the government had been acting in good faith so quickly

dismissed any idea of awarding exemplary damages, it did find that the government had been fully aware of the risk it was taking and further that it had aggravated the situation by contesting the interim injunction sought. It held that the UK government had indeed committed a sufficiently serious breach of EC law and gave judgment for Factortame.

The case was then stayed to enable damages to be assessed by a later court. In fact this proved unnecessary as a settlement was reached in which Factortame and the other claimants (approximately 90 Anglo-Spanish fishing companies) accepted an offer of settlement from the Secretary of State.

Under the terms of the settlement the claimants, who had originally claimed £285 million, received £55 million together with interest of some £26 million.

Legal Issue 5 – limitation periods Having succeeded in all courts, but not having received the full compensation sought, Factortame saw no reason for the battle to finish now and so sought to use the precedents to initiate further damage claims for all the vessels that it had not included in the initial action. In an even more ‘inventive; step it sought damages under the Race Relations Act 1976 for injury to feelings and aggravated damages 22

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using, comparing the actions to those for discrimination detailed by that Act. At this time however its luck ran out, the court enforced a tortious limitation period of 6 years and discarded any possibility of a Race relations claim which it said only concerned damage to an individual’s self-esteem.

What impact on UK and EU law? This case was not only a key building block in the development of ECJ jurisprudence and the changing

constitutional

structure of the EC/EU but also fundamental in its impact upon English law and

the

English

legal

system.

At the European level, the ECJ were given the opportunity to further advance its arguments on EC supremacy, restating that incompatible national law should be dis-applied and adding a further weapon to the developing armoury of EC procedural law in requiring effective remedies to be enforced/created at national level even when they did not exist in the national legal system. The Court was also able to refine and review the Francovich principle of state liability and reinforce the role of

national courts as enforcers of EC law in their own legal systems.

At the UK level, it was another step in a path suggesting that EC membership had diluted Parliamentary Supremacy, intimating A)

that Parliamentary Acts might no longer be treated as of equal status and adding that some Acts were now regulated directly by the EC and could be dis-applied when incompatible with EC law. The privileges and prerogatives of the Crown were also arguably now diminished with its actions being laid open to liability in EC claims.

B)

That the relationship of the Parliament and the Courts had also changed, with the Courts taking a role as enforcers of EC law in a changing constitutional hierarchy.

What is most instructive however is a consideration of cause and effect.

How much of this change was brought about by the actions of the Government of the day, both in the way it was decided to approach and resolve the initial economic and political problem and then subsequently in the manner in which it chose to manage and defend its case apparently with little understanding or foresight of potential future consequences. Will we look back on the events of June 2016 in 15 years and find similar parallels I wonder....

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The Constitutional Conundrum of Article 50 TEU and BREXIT Ruairi Oneill BLC Tutor

Section 1(1) of the European Union Referendum Act 2015 required a referendum to be held before the end of 2017 on whether the UK should remain a Member State of the European Union. On 23 June 2016, 52% of individuals eligible to vote in the referendum voted to leave the European Union. Given that the United Kingdom does not have a single, written constitution, there has been sustained debate since then as to precisely how the UK can leave the European Union. Starting with Art 50 TEU, this article will consider the options.

Article 50 TEU Article 50(1) TEU states that a Member State may decide to withdraw from the European Union in accordance with its own constitutional requirements. Article 50(2) further adds that the withdrawing Member State has an obligation to notify the European Council of its decision, which is followed by negotiations with the European Council resulting in a withdrawal agreement between the withdrawing

24

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25

Member State on the one hand, and the EU acting under its powers to enter into agreements with third countries under Article 218 TFEU on the other. Once officially commenced, the process of withdrawal must conclude within two years, and can only be extended with unanimous consent of all members of the European Council (Art 50(3) TEU).

Not including the withdrawal of Greenland from the EEC in 1985 to become an overseas territory of an EU Member State following its accession in 1973 as a dominion of Denmark and subsequent referendum result in 1982 to withdraw, no fully-fledged Member State has ever left the European Union. Furthermore, Art 50 TEU has only been in existence since the entry into force of the Lisbon Amending Treaty of 2009, and was established to ensure that membership of the EU was voluntary, as well as to prevent ‘awkward’ Member States from being ejected from the Union against their will.

Careful analysis of Art 50 TEU is therefore necessary in order to understand the obligations of both the EU and the UK in withdrawal negotiations.

Article 50(1) TEU Art 50(1) TEU assumes that all Member States possess constitutional mechanisms to facilitate withdrawal from an international organisation such as the EU. The debate in the UK has focussed on four possible mechanisms that can be utilised, with the Government favouring the exercise of the

Royal Prerogative.

Before considering the main mechanisms under consideration, there has been a fifth, plainly incorrect, theory, that the referendum result itself is the constitutional requirement required by EU law, and that prompt notification of this result is demanded by Art 50 TFEU. This theory stems from Article 5 of the European Parliament Resolution of 28 June 2016 on the decision to leave the EU resulting from the UK referendum, which states that the European Parliament: “… expects the UK Prime Minister to notify the outcome of the referendum to the European Council of 25

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26

28-29 June 2016; this notification will launch the withdrawal procedure.�

This view, adopted by the majority in the European Parliament, is probably based on the assumption that the UK has the same constitutional tradition as other Member States, such as Ireland, where referendums are required to give effect to important changes to the national constitutional order. In the UK, however, referendums are rarely utilised, and when they are used, they usually exercise a prelegislative advisory role for Parliament, which retains the legal discretion to give effect to the results of referendums. An example of this type of referendum was the first referendum on continuing membership of the EEC, which was held in 1975.

Only occasionally can referendums force legislative change, such as with the referendum on adopting alternative voting (AV) for Parliamentary elections, which took place on 5 May 2011, pursuant to Section 1 of the Parliamentary Voting System and Constituencies Act 2011. The result of the referendum was negative, thus retaining the first-past-the-post voting system, but had it succeeded, Section 8(1) of the Act required the Minister to present a draft Order to Parliament which, if then successfully adopted by the legislature, would implement the AV voting system for the next subsequent parliamentary election. What is clear is that, while this referendum compelled the 26

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27

Government to introduce draft legislation to change existing provisions, it was still subject to the ultimate approval of Parliament, thus confirming the most vital Constitutional Convention of Parliamentary Sovereignty: the principle that the Westminster Parliament theoretically retains sovereignty over all legislative matters.

The Royal Prerogative The prerogative powers are those discretionary powers that the Crown retains either because they have not been abolished by Parliament or replaced by statutory powers. In Council of Civil Service

Unions v Minister for the Civil Service (the GCHQ case), Lord Diplock added to the definition that the exercise of the power must have some legal effect, describing the prerogative as: “A residue of miscellaneous fields of law in which the executive government retains decision-making powers that are not dependent on any statutory authorisation but nevertheless have consequences on the private rights or legitimate expectations of other persons.

In a subsequent judgment of Secretary of State for the Home Department ex parte The Fire Brigades Union, the House of Lords considered the relationship between the Prerogative Power and statute, where Lord Browne-Wilkinson stated that: “…it would be most surprising if, at the present day, prerogative powers could be validly exercised by the executive so as to frustrate the will of Parliament as expressed in a statute and, to an extent, to pre -empt the decision of Parliament whether or not to continue with the statutory scheme…”

In a majority decision, the House of Lords held that the Secretary of State had abused his power through the exercise of the Royal Prerogative in a way that directly conflicted with an existing statutory obligation. What this is generally taken to mean is that the prerogative powers cannot be used to take a power away from Parliament, where statute law already exists and the Government wishes to

circumvent the application of primary law through its own actions.

Historically, however, the courts of the UK have denied that they had jurisdiction to review the exercise of the Royal Prerogative, though it is now accepted that if the Government claims to have exercised the Prerogative Power and that action is then challenged in judicial review proceedings, the courts will assess firstly whether the power exists and then consider under the normal principles of judicial review whether the power was exercised properly. The first major judgment where the courts 27

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28

showed a willingness to review the exercise of the prerogative power was Council of Civil Service Unions v Minister for the Civil Service, which concerned judicial review of an oral decision by the Prime Minister in the field of national security, which was itself taken pursuant to an Order in Council adopted under the Royal Prerogative. Overturning the Court of Appeal ruling that judicial review cannot be used to challenge the exercise of the Royal Prerogative, the House of Lords held that certain actions taken under the Royal Prerogative were justiciable, but qualified this statement by saying that some matters were not amenable for

judicial review, such as those relating to the making of treaties. The justiciability of the exercise of Royal Prerogatives was further developed in R (on the application of Bancoult) v Secretary

of

State

for

Foreign

and

Commonwealth Affairs (No. 2), with Lord Hoffmann stating that a prerogative Order in Council has the status of primary law in the UK, adding that: “… The principle of the sovereignty of Parliament, as it has been developed by the courts over the past 350 years, is founded upon the unique authority Parliament derives from its representative character. An exercise of the prerogative lacks this quality … I see no reason why prerogative legislation should not be subject to review on ordinary principles of legality, rationality and procedural impropriety in the same way as any other executive action.”

Where Art 50 TEU is concerned, the issue is whether the notification can be categorised as the exercise of the Royal Prerogative as it relates to international treaties, but equally important is whether the existence of the European Communities Act 1972 (“EC Act 1972), which gives effect to EU law within

the UK legal order, precludes the exercise of the Royal prerogative should one be deemed to exist.

The prerogative power limited by the EC Act 1972

The EC Act 1972 was adopted to give effect to the UK’s membership of the European Union. Section 2 of the Act provides that all rights, liabilities, obligations and restrictions arising under the Treaties are part of UK law. Section 2(1) states that: “All such rights, powers, liabilities, obligations and restrictions from time to time created or arising by 28

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or under the Treaties, and all such remedies and procedures from time to time provided for by or under the Treaties, as in accordance with the Treaties are without further enactment to be given legal effect or used in the United Kingdom shall be recognised and available in law, and be enforced, allowed and followed accordingly; and the expression “enforceable EU right” and similar expressions shall be read as referring to one to which this subsection applies.”

Further, Section 2(2) of the Act states that: “any designated Minister or department may … make provision— (a) for the purpose of … enabling any rights enjoyed or to be enjoyed by the United Kingdom under

or by virtue of the Treaties to be exercised.”

Thus one possible argument against the use of the Royal Prerogative to make the Art 50 TEU notification is that to do so would render application of the EC Act 1972 ineffective. The first criticism of this argument is that notification of withdrawal

under

Art

50

TEU

by

the

Government would not have the automatic effect of rendering the EC Act 1972 ineffective; notification merely activates the procedure in EU law whereby the UK will prepare for withdrawal from the European Union. Under the prerogative, the Government retains the power to ratify the withdrawal treaty with the EU, and once that treaty enters into force, the UK will no longer have an international obligation to comply with EU law. But even then, the EC Act 1972 will continue to exist until Parliament annuls it, with EU law continuing to exist in the UK legal order, either as implemented UK secondary law or as directly applicable EU law applied under Section 2(1) of the EC Act. In the same way that candidate

countries wishing to join the EU often implement EU law before having either a strict obligation to do so or the ability for making references to the Court of Justice of the EU (hereafter “CJEU”) to ensure compliance, a country that has left the EU will likely continue to apply EU law through incidental harmonisation. Additionally, until the UK signs the withdrawal agreement, it will be under an obligation to comply with EU law, so repeal of the Act prior to withdrawal would additionally amount to a breach of the UK’s obligation of mutual respect under Art 4(3) TEU. The second problem with the argument that the existence of the EC Act 1972 precludes the application 29

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30

of the Royal Prerogative to make the Art 50 TEU notification is that Section 2(2) of the Act provides the Government with the power to implement and give effect to EU law without requiring an Act of Parliament in every instance where an obligation arises under EU law, such as with the adoption of an EU directive; a power which could extend to the making of the Article 50 TEU notification.

The situation whereby a prerogative power and a power under statute overlap was dealt with by Lord Atkinson in Attorney-General Appellant v De Keyser’s Royal Hotel, when he stated that: “… such a statute … abridges the Royal Prerogative while it is in force to this extent: that the Crown can only do the particular thing under and in accordance with the statutory provisions and that

its prerogative power to do that thing is in abeyance … after the statute has been passed, and while it is in force, the thing it empowers the Crown to do can thenceforth only be done by and under the statute, and subject to all the limitations, restrictions and conditions by it imposed, however unrestricted the Royal Prerogative may theretofore have been.”

Thus it can be said that, since Section 2(2) furnishes the Government with the power to adopt secondary laws (specifically “order, rules, regulations or scheme”) to give effect to EU law without the need for recourse to Parliament, then the Government is fully entitled to make the notification under Art 50 TEU, as an obligation under EU law, pursuant to the 1972 Act.

Authority to authorise notification to the Council of withdrawal Geoffrey Robertson QC, writing in the Guardian Newspaper, argued that Art 50 TEU allows notification to be made in compliance with national constitutional requirements and that “the UK’s most fundamental constitutional requirement is that there must first be the approval of its parliament.” The constitutional provision he is referring to is that of Parliamentary Sovereignty; the most important constitutional convention that puts Parliament at the apex of the UK legal system.

In the House of Commons Briefing Paper on Brexit, the proposition in favour of Parliamentary approval

before the notification is made is derived from the common law principle found in The Case of Proclamations and Fire Brigade Unions case that the Royal Prerogative may only be used if it does not conflict with an Act of Parliament. The Act in question is the EC Act 1972, though affected legislation includes the European Parliamentary Elections Act 2002, which provides for European Parliament voting and representation rights. Rather than strengthen the proposition that Parliamentary approval is necessary before the Government can make the Art 50 TEU notification, however, this argument instead lends more weight to the proposition that Section 2(2) of the EC Act 1972 provides the proper 30

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31

authority to make the notification, since this is the Act of Parliament that empowers the Government to give effect to EU law.

Finally, the House of Commons Briefing Paper proposes that, because Parliament gave effect to the Lisbon Treaty, which included Art. 50 TEU, in the European Union (Amendment) Act 2008, approval has already been given to the Government to make the notification without authorisation. From a purely legal point of view, this cannot be the correct constitutional position, because giving effect to Art 50 TEU as part of primary EU law is not synonymous with having in place the national constitutional requirements that Art 50 TEU requires in order to give it effect. Rather, Art 50 TEU created an

obligation for Member States to have such arrangements in place as part of national constitutional law.

Conclusion on the Art 50 TEU Notification While the question of authority is not clearly discernible in the absence of defined and accessible constitutional rules, it is possible to make a number of conclusions at this point. The first is that the exercise of a right or obligation contained in an international treaty falls within the Royal Prerogative, unless that power has been limited or restricted by an Act of Parliament. In this case, the notification under Art 50 TEU is a right contained in a treaty, which, unless limited by Parliament, is exercisable under the Royal Prerogative. As an exercisable EU right, the Government has the choice to make the notification after authorisation is confirmed by statutory instrument pursuant to the EU Act 1972; this, though, would seem like an unnecessary additional burden, as it would have the absurd result of the same organ of state empowering itself to act. It is submitted that nothing in the EC Act 1972 restricts the Government in the exercise of this right, which in turn does not have the automatic effect of frustrating

the

will

of

Parliament, given that all EU law

will continue to apply in the UK legal

system

until

the

withdrawal agreement is ratified and primary law is enacted to define the precise status of EU law following Brexit.

31

Interview with Iain Morley QC Iain Morley QC is the author of the bestselling book ‘The Devil’s Advocate: A Short Polemic on How to Be Seriously Good in Court’. He has taught legal skills in 33 different jurisdictions and has litigated before numerous international criminal tribunals, including the International Criminal Tribunal for Yugoslavia (ICTY) and he was the leading force behind the creation and the organisation of the UN Rwanda Tribunal. His cases include everything from genocide, war crimes, ethnic cleansing, crimes against humanity and international terrorism.

On 16th September, Mr Morley gave a lecture for the British Law Centre, entitled: The Art of Advocacy – the Changing Role of Legal Skills Training. After the lecture, he was kind enough to speak to Obiter Dicta about his many years of experience as a barrister and legal skills trainer.

This isn’t the first time you have been to Warsaw, is it?

I came to Warsaw for the first time in 1992 to teach common-law advocacy skills to Russian judges. It was rather strange 32

Interview with because the Soviet Union had only just collapsed, as we all remember, on 25 December 1991, and they were quite sure at first that myself and the two judges we brought with us were working with either the CIA or MI6.

friend of mine Stephen Kay QC who was at the ICTY and he asked me to come over to help. The Tribunal had ordered him to represent Slobodan Milosevic, former president of Yugoslavia who had been representing himself until that time.

The decision was taken that Stephen was appointed defence counsel and all hell broke loose, because he didn’t have instructions and Milosevic didn’t want help. I was there for five months and the first thing we did was file that we shouldn’t be his defence counsel.

I’m pleased to say at the end of five months we were all fired!

When did you start practicing as a barrister?

I have been 28 years at the Bar of England and Wales, and was called forward to the rank of Queens Counsel (QC) in 2009, so 20-odd years of practice doing all sorts of criminal work.

I started out with speeding offences, drunk drivers, the things of lower courts and gradually worked my way through different types of criminal offences to the point where, by the time we get to 2004, I was doing rape cases, armed robberies and was junior counsel in murder trials.

Since then you’ve been involved a lot in international criminal tribunals, haven’t you?

In that time, I got to know how the world of international criminal law worked, and I was appointed by the UN Secretary General to prosecute the Rwanda genocide as one of the lawyers in Arusha in Tanzania, in the foothills of glorious Mount Kilimanjaro. I then travelled to The

How did you come to practice at the ICTY? I received a telephone call whilst I was in a bank in a small town back in the days when mobile phone batteries lasted only 45 minutes, and it was a 33

Interview with Hague, where I was responsible for constructing the indictment, and marshalling the evidence and building the case against Hezbollah in respect of the assassination in 2005 of the Lebanese Prime Minister, Rafic Hariri.

Then I felt the clarion call of my brothers and sisters at the Bar back home so I went back there at the beginning of 2013, where, for the last three years, I have mostly defended, sometimes prosecuted.

students basic advocacy skills; we then teach our apprentices, who we call pupils, more basic advocacy skills; we then teach our new practitioners, people of up to 5 years’ experience, more advocacy skills.

So you are a strong believer in continuing professional development?

One of the things that we’ve noticed is that, particularly in the early years (i.e. the first 15 years of practice) there’ is a huge variety of abilities and those who have had advocacy training have raced up the ladder in terms of recognition, reputation and reliability and developed their practices faster and more compellingly than the others. They win their cases because they’re better than the advocates on the other side. The consequence, therefore, is that within the adversarial system we have in England and Wales, advocacy means that a good lawyer can win a weak case and a weak lawyer can blow a good case. All the time you will hear lawyers commenting on each other’s advocacy abilities by reference to how it seemed

When did you become involved in advocacy training?

I stumbled upon advocacy training in 1993 when I went to the University of Gainesville, Florida, in the US, for a course on how to improve advocacy. I learnt that you can actually teach basic competence, and here’s the thing about basic competence in court among lawyers: it’s very rare! This was all very revolutionary back in 1993 where the senior elements at the Bar of England and Wales were absolutely certain that advocacy was learned by a process of osmosis. Since 1994, we teach our

34

Interview with impossible that that lawyer won the case, and that is very often a reflection of the ability of the lawyer as an advocate.

sharp with your opposition and ambushing them, keeping them offbalance by dumping legal authorities on them, calling witnesses that you didn’t say you would call, or not calling those that you said you would. The reason you don’t do that is because, if you do, your opposition won’t trust you and if they won’t trust you, they won’t work with you, and who’s going to be pretty unhappy about that? The judge. And who was it that you have to persuade?

The judge. And if the judge thinks you’re a bamboozler, you will find it difficult to persuade the judge. The third rule is to remember that it is not the client that you need to persuade, but the judge. Remember the three basic rules of behaviour; the three qualities that you require to be a good trial lawyer: you have to have integrity, you have to be irresistible, and you have to be invisible. In England and Wales, we are called an Honourable Profession, and your private life could be in complete chaos but your public life as a lawyer must always be with integrity, reliability and honesty!

What advice can you give young litigators?

The most persuasive thing you can develop in court is the trust of the judge as the finder of fact. There are three rules that we observe in the UK. The first is: do not lie. You know it’s sometimes very difficult to stick to, that if you tell a small, little, teeny-weenie lie, you might win the case, and be carried shoulder-high through the streets of New York as you might imagine on the TV. But if you lie, you should leave the Bar; the ground should open up underneath you and you should be buried in volcanic ash, because the whole system of justice requires that the public trust the system so the public need to have faith in the profession. The next rule is: do not bamboozle! It’s a nice word, and I’m not really sure what it means but I kind of understand that it basically means being

35

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National & International Interests

This section contains student contributions relating to topics of interest both nationally, within each Member State, and also of interest internationally and comparatively.

The power of revitalization:

A new Polish law on spatial planning Adrianna Konczak BLC 1st Year Warsaw Centre

Last year the Polish Parliament for the first time enacted a bill regarding the process of revitalisation. This legislation will have a significant impact on regional development and the regulations on spatial planning in Poland.

Before the aforementioned statute was passed, issues connected

with revitalisation had been governed by The Regulations of Spatial Planning. According to those provisions, municipalities were obliged to indicate conditions and directions for the study of spatial development, and areas

which

were

in

need

of

rehabilitation, restructuring and reclamation“ (sect. 10, sub.3). The lack of complex regulations regarding revitalization

36

prevented municipalities

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37

from designating degraded zones and taking actions to restore them. Now all the regulations on these matters have been moved to the Revitalisation Act 2015.

Reasons for the Act The working assumptions behind the enactment can be seen in four elements of the National

Revitalisation Act set out by The Ministry of Infrastructure and Development. The aim of the project is to implement a general framework for conducting the process of revitalisation and to simplify its procedures. Moreover, the proposed activities are intended to increase local inhabitants’ awareness of the importance of revitalisation and encourage them to participate in creating the revitalisation plan for their own particular municipalities.

According to the draft bill guidelines adopted by the Council of Ministers in March 2015, the main organizational barriers to revitalisation projects are:

a. A lack of coordination among public institutions in the process of preparing revitalisation programs b. Local authorities’ excessive focus on using the revitalisation program as an instrument for acquiring funds from the European Union c. Revitalisation activities are carried out in communities on an ad hoc basis without advance planning

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d. The lack of possibilities for implementing local zoning rules and regulations regarding the realisation of revitalisation process in a manner that complies with development planning.

The objectives of the Act The main addressees of the Act are local authorities and inhabitants of communities designated as degraded zones. Under section 2(2) of the Revitalisation Act, the legislation will also impact on: a. land held in perpetual usufruct and the owners of properties located on the areas subject

to revitalisation b. housing cooperatives, housing communities, and the administrators of real estate c. entrepreneurs performing economic activities on revitalisation areas d. public authorities and non-profit organizations.

General principles of the Act Establishing the programmes, creating the conditions, and coordinating the measures for revitalization are each defined as facultative community tasks. Accordingly, the affected local authorities are not obliged by law to draw up a plan. If municipalities have already carried out revitalisation activities in their jurisdictions, implementation of the Act shall not interfere with

OBITER

DICTA

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these.

PAGE

39

They can continue these activities within the old legal framework for several years

after the entry into force of the Revitalisation Act, but will be unable to benefit from the more convenient and inclusive procedures envisaged under the new regulations.

Under the Act, the main instrument for effecting revitalisation of degraded zones will be the municipal revitalisation programme enacted by local authorities through participatory procedures that include the views of inhabitants, entrepreneurs and non-governmental organizations. Nevertheless, the

municipal revitalisation program shall not be treated as generally applicable law and will bind only executive bodies of the municipalities.

A programme should comprise: a. diagnosis of social and economic problems occurring within the municipality

b. assessment of the condition of technical and infrastructural equipment c. a statement of the revitalisation programme’s goals regarding the relevant degraded zones d. delineation of degraded and facultative revitalisation zones e. the list of actions proposed to be taken f. a preliminary financing plan, which indicates the funds needing to be acquired for the realization of the programme

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Under section 9 of the Revitalisation Act, a degraded area can be defined as an area which suffers from a high unemployment rate, a low level of education, or a lack of social participation in public and cultural events.

A revitalisation target area will be that part of a degraded area where there is the highest concentration of negative factors. Delimitation of a revitalisation target area will be optional for local executives, but its demarcation can improve the efficiency of revitalisation activities because of the special

legal

instruments

applicable

to revitalized zones such as the Special Revitalisation Zone (SPR). Due to the exceptional powers

created

under

the

Act, regulations such as the SPR can be passed only as generally

applicable

law

binding on all inhabitants of the particular municipality and their duration is restricted to an upper limit of 10 years. The articles regarding the Special Revitalisation Zone contained in the Revitalisation Act 2005 anticipate longterm and integrated interventions such as in the area of social housing—which may necessitate the acquisition

of

real

estate

through

effective

expropriation

carried

out

by

local

authorities, although certainly attended by equitable compensation for owners. The designation by resolution of an SPR will also serve as the basis for termination or modification of terms and conditions of tenancy agreements in the field of social housing, at least when this is necessary in order to enable construction works. After works are completed, rental tenants will be entitled to return to their

former

dwellings.

During

the

realization

of

the

investment,

each

municipality must ensure that alternative residential accommodation is provided for social housing tenants. A provincial governor will be allowed to issue an administrative decree in cases where tenants refuse to move out of their old houses.

The aforementioned features of

the regulation raise the question of its compliance with the protection enjoyed by ownership rights. According to Article 21 of the Constitution of the Republic of Poland: “Expropriation may be allowed solely for public purposes and for just compensation”. There is no clear answer to which right prevails in the event of a clash between the needs of expropriation for important public 40

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reasons, such as revitalisation, and ownership. It seems the creation of a Special Revitalisation Zone should be pursued only in areas in which there is the highest level of social and economic

degradation.

Social participation in the revitalisation process One of the aims of the Revitalisation Act is to encourage inhabitants of local communities to participate in the process of transforming degraded zones. The Act imposes upon district councils the obligation to ensure use of the most appropriate mechanism prior to passing into law revitalisation programmes for particular municipalities. According to Article 6(3) a public consultation will be conducted

which

incorporates

debates,

surveys,

meetings

with

local

authorities

and the gathering of comments on actions being proposed by participants. Moreover, the Revitalisation Act assumes (ustawa zakłada powołanie), in each case, the establishment of a Revitalisation Committee, which is to provide a forum for dialogue between inhabitants

and authorities on matters relating to the preparation and assessment of proposals concerning the revitalisation programme already prepared by the district council. Also, the Revitalisation Committee will be regarded as an advisory body for local executives.

The critics of the Revitalisation Act argue that the legislation should not have been passed, but the criticisms

levelled

generally

rest

on

dubious

and

invalid

assumptions.

According

to critics, ambiguous concepts such as “social capital” and “insufficient participation of inhabitants in 41

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42

cultural and social life” can cause misunderstanding as regards which zones should be selected or

revitalisation

programmes.

Another

criticism,

mentioned

above,

is

directed

at the seeming possibility that inhabitants living in the Special Revitalisation Zone might be expropriated on grounds that such SPRs represent a “public purpose” which outweighs the rights of ownership and possession.

A further questionable regulation is Article 35

of the Revitalisation Act, which allows municipal authorities to provide a grant-in-aid (not exceeding 50% of total expenditure) to owners and persons benefitting from perpetual usufructin-possession rights relating to a property in a Special Revitalisation Zone. Such funds would be granted for the rebuilding and reconstruction of the relevant properties insofar as such activities would comply with the Revitalisation programme. Critics state that uncontrolled grants allocated exclusively for revitalisation areas can lead to the misuse of funds.

Conclusion

It is worth noting that the Revitalisation Act came into force only six months ago and it is accordingly hard to evaluate its effects and how its regulations may influence and change local authorities’ approach towards revitalisation. A budget of 25 billion zlotys has been allocated for

revitalisation undertakings for the 2014-2020 period, of which as much as 90% will come from EU funds, with the remainder being sourced from central and local government budgets. Given this large flow of resources, and with the aid of coordinated action and long-term plans overseen by local authorities, it seems that the revitalisation anticipated by the recent legislation will have a large impact on the appearance of Polish towns and cities.

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Justice for the 96 (and many more)? The Hillsborough Disaster and its impact on English law Steve Terrett BLC Deputy Course Director

As an avid supporter of Liverpool Football Club (“LFC”), this writer has had few sporting victories to celebrate in recent years. However, recent legal events arguably represent the most important victory that the football club has seen in the past 27 years. The 2016 report of the Hillsborough inquest, which was set up to investigate the causes of the worst disaster in British sporting history, finally laid to rest the false accusations that LFC fans themselves had caused the crush as a result of which 96 people died and 766 were injured. This article discusses some of the legal ramifications of the Hillsborough disaster and the case-law which followed it, together with some of the ways in which the findings of the 2016 inquest may impact on certain aspects of English law. It critically analyses some of the criteria governing the recoverability of damages for “nervous shock “, laid down in the House of Lords’ judgment in the Alcock case, and suggests that the 2016 inquest report should act as a catalyst for reviewing these criteria.

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The factual events The semi-final of the FA Cup, featuring LFC against Nottingham Forest, took place on Saturday 15 th April 1989 at 15.00 at Hillsborough Stadium in Sheffield. This neutral venue was usually the home to Sheffield Wednesday FC. Hillsborough football ground already had a history of safety concerns. In 1981, a serious crush had occurred on the Leppings Lane terrace (which was to be repeated with much more disastrous consequences 8 years later), in which 38 visiting fans had suffered serious injuries. Following this, modifications were made to the Leppings Lane end – it was dividing into self-contained “pens”, which some commentators compared to cages at a zoo. This was, at the time, thought to be a necessary precaution against football hooliganism but, as the Hillsborough inquest reported, key features of the terrace were “dangerous or defective”, including crush barriers which failed to comply with official safety standards and the fact that over 10,000 fans were required to enter the terrace through a mere 7 turnstiles.

In 1987, Hillsborough hosted the FA cup semi-final between Leeds United and Coventry City. The kickoff was delayed because the fans were unable to access the ground on time, given the difficulties of processing so many fans through so few turnstiles.

Thus, as the 3pm kick-off of the 1989 FA Cup semi-final drew near, many were already sceptical about whether Hillsborough stadium should have been chosen to host the event and why the greater number of Liverpool fans had been allocated the smaller end of the stadium (Leppings Lane). All of the 53,000 available spaces (including over 10,000 standing places) had been sold and a large congregation of LFC fans were gathered near the entrance to the stadium, which was a very narrow street leading to the 7 available turnstiles. In order to disperse the tightly-packed crowd gathering outside the football ground, the South Yorkshire police opened a gate and allowed thousands of fans to pour into the stadium at once. Once inside, those fans followed the Gate C path in front of them to 44

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45

pens 3 and 4 of the Leppings Lane terrace (which had already been at beyond full capacity for some

time prior to this) and became trapped in the cage-like pens. The ensuing crush resulted in 95 people losing their lives on the day and another person dying many years later, following a legal battle to allow his life-support machine to be unplugged.

The initial potential for crowd congestion in the narrow street outside the stadium had been managed in previous years by creating horse-mounted police cordons (i.e. barricades) and controlling the flow of fans who entered the narrow street at the Leppings Lane end. However, on the day of the Hillsborough disaster, 172 fewer police officers were deployed than at previous semi-finals held at the same stadium and their strategy was coordinated by a newly-appointed Chief of Police, Chief

Superintendent David Duckenfield. He had had no experience of policing such a large sporting event and later admitted to a number of significant strategy errors, including his failure to order the creation of cordons to control the flow of fans into the stadium. Former South Yorkshire Police inspector Gordon Sykes prophetically described the area in question as a "death trap". Having failed to control the crowd outside the stadium, the police then made the situation far worse by failing to close “Gate C� inside the stadium, which led straight to pens 3 and 4. Had this been closed (as had happened previously when the pens 3 and 4 were full), the LFC fans would have been forced to 45

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46

disperse between the pens at the edges of the stadium. However, with Gate C left open, fans followed the large “Standing Areas” sign on Gate C and headed directly for the over-crowded central pens 3 and 4. Mr Duckenfield later admitted during the inquest that his failure to close the tunnel "was the direct cause of the deaths of 96 people”. He explained that he simply “froze” when it became apparent what was happening.

One possible response to the crowd congestion that had built up outside the stadium was to delay the kick-off from 3pm until such time as the crowd could be safely dispersed inside the ground. This was a fairly common tactic in football games of the time, but it was one which Mr Duckenfield did not adopt, despite being aware of the situation by way of CCTV located inside and outside the ground. He later accepted that this was a terrible mistake.

The chaos which resulted from the initial crush as the fans entered pens 3 and 4 was made much worse by the police’s failure to recognise and respond to the evident signs that the LFC fans in those pens were being crushed. Indeed, medical evidence heard during the inquest proved that the police’s failure to call for the emergency ambulance services and the decision to delay their entry into the stadium (due to “crowd trouble”) led to the deaths of people who could otherwise have been saved.

Meanwhile, the police near the pens confused the panicked attempts of those trying to escape the crush with attempts to invade the pitch – accordingly, some fans were beaten by the police and prevented from being lifted over the pens’ fences to safety.

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The aftermath of the tragedy The result of this calamitous combination of erroneous policing decisions was that 95 people died that day and another person died some years later. However, this tragic fact was made worse by the treatment of LFC fans which followed. Firstly, relatives who sought to locate their loved ones were forced to wait many hours before being taken to a gymnasium inside the stadium which was being used simultaneously as a temporary mortuary for the dead, a medical centre for the injured and an investigation room for the police. Relatives were shown a wall full of polaroid photographs taken of the dead victims and, if they were able to identify their loved one from the photograph, their dead

body was brought to the family for a confirmation of identification. No attempt had been made to segregate the bodies or photographs using simple criteria (e.g. male/female; adult/child; black/white etc.), which meant that families experienced a harrowing process of being shown almost 100 photographs of corpses, whilst the bodies lay nearby in body-bags. Once identified, families were prevented from touching or even spending any time with their deceased loved ones, and were told that their bodies were now evidence which belonged to the police. Almost immediately afterwards, the police began to interrogate the family members about the drinking habits previous criminal convictions and any violent tendencies that their recently-deceased loved one may have had. The South Yorkshire police had already taken blood samples from all of the dead bodies (including children as young as 10 years old), hoping to find traces of alcohol to bolster the story that would later be told – i.e. that a drunken mob of ticketless LFC fans had caused the fatal events of that day.

Indeed, very shortly after the tragic events, a police spokesman announced on public news that

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drunken LFC fans had forced down the gate to the stadium, despite this being a lie that was known to all involved. Meanwhile, a police-led media campaign had begun, claiming that the LFC fans had been drunk, aggressive (including allegations that they had fought with and urinated on police who were trying to save the lives of injured fans), and that many had stolen personal belongings from dead bodies. These disgusting falsehoods, all of which were retracted by the police in the inquiry over 20 years later, formed part of a concerted effort to divert public attention away from the police’s failings on that day and towards the alleged fault of LFC fans, including those who had died. Many years later, it would also come to light that many statements taken from police present at Hillsborough that day contained criticisms of the overall police management of the semi-final. All such statements were deleted from the versions of those statements which were later presented as evidence of why the tragedy occurred, and a number of retired policemen have reported being placed under severe pressure to “keep quiet” about the palpable police negligence which occurred that day.

The coroner’s investigations A subsequent coroner’s investigation provided no comfort for the families of the deceased who were seeking to have the full details of their loved ones’ death made public knowledge. The coroner declared that, in seeking to establish the reason for the deaths of the victims, he would not hear any

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evidence of events which took place after 15.15 on the day of the tragedy since, in his opinion, all victims had died by this time. This controversial conclusion was contradicted by video footage taken that day, which showed rescue attempts being made by medical personnel long after 15.15. One of the main allegations of the surviving family members was that the police’s extreme delay in calling for (or allowing access to) the emergency medical services on that day had caused the death of numerous people who could otherwise have been saved. The arbitrary cutoff time served to exclude any evidence being heard on this.

The ultimate conclusion of the coroner’s investigation was that of “accidental death”.

The Alcock case and the rules of recovering damages for nervous shock The media battle to divest the police of any responsibility for the tragedy was matched by a number of legal battles which lasted for many years. The most famous of these was perhaps the case which ended with a judgment from the House of Lords (Alcock & Others v Chief Constable of South Yorkshire [1992] AC 310) that prevented the relatives of the deceased from recovering any compensation for “nervous shock”. This area of tort law has given rise to a number of controversial rulings, since it based on the concept that certain people who have a very close relationship with the victim of a tort should also be able to seek compensation for the psychological illness they suffered due to witnessing the event. The various legal rules are complex and beyond the scope of the present article (they are discussed in more length during the BLC’s Diploma Course), but for present purposes it suffices to note a number of significant weaknesses which their Lordship’s opinions contained.

Firstly, it was confirmed that, in order to be eligible to claim such compensation, the claiming relative must be geographically proximate to the event which caused their loved one’s death or its “immediate aftermath”. On the facts of the case, this was clearly intended to deny any claims which may have been initiated by family members who witnessed the crush on live television. Their 49

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Lordships’ judgments were based, in essence, on the conclusion that events witnessed at a distance (such as those watched on live TV) could not be deemed, as a matter of law (not fact), to be as traumatic as those witnessed in person. This was almost certainly true as a matter of fact in relation

to the Hillsborough tragedy, since the BBC’s broadcasting guidelines meant that, once it was clear a disaster was unfolding, the camera footage showed only a long-distance, withdrawn view of pens 3 and 4, which did not show the suffering of any particular individuals, However, life is complicated and this may not be always the case. Imagine, for example, if a young boy (let’s call him Sam) has won a prize to ride in a hot-air balloon. Sam lives in a fairly small town, so his hot-air balloon ride attracts some local media attention and is shown on a live broadcast of the local news. Sam’s father has taken him to the place from which he will take-off, whilst Sam’s mother watches the event from home on live TV. Unfortunately, when the balloon has taken off and is a few miles away from the lift-off location, an accident occurs and it catches fire. The cameraman who is in the hot-air balloon with Sam films the entire event (until he also dies), so Sam’s mother watches her son’s agonising death on live TV. Meanwhile, Sam’s father has seen the balloon catch on fire from a distance of a few miles. He drives to the place where the balloon has crash landed, but police and fire services prevent him from getting close to the burning balloon. When the situation is under control, Sam’s body is taken to the hospital. In this horrific story, should it really be decided that as a rule of law Sam’s mother should be unable to seek compensation for nervous shock because she “only” saw the event on TV? Should we 50

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ignore the fact that the images she saw of Sam’s final moments were far more detailed, horrific and traumatising than those seen at a distance by Sam’s father? Of course, as with many legal cases, many questions of fact would need to be established about the nature of the images Sam’s mother saw, the extent to which Sam’s father’s presence at the scene of the crash-landing may be considered to have been more traumatic etc. The point that this author wishes to make, however, is that these are valid questions which should be left to the discretion of a trial judge who is best placed to deal with such factual questions. To decide, as a rule of law, that relatives who view traumatic images at a distance

are

automatically

incapable

of

seeking compensation seems an overly-rigid approach that is uncharacteristic of English law, which correctly prides itself on finding pragmatic answers to difficult legal issues. By removing the possibility for any discretion at a first-instance level, the House of Lords created an uncompromising rule of law which may prevent the recovery of damages in some cases that a “reasonable man” would find

deserving of compensation. Their Lordship’s inflexible rule also sits uncomfortably with many developments in modern technology. Is the experience of witnessing a loved one being killed during a Face-Time or Skype conversation really to be treated as so incomparable to witnessing the event “live” that a rule of law should exist to prevent the recoverability of damages?

Secondly, their Lordships decided that the categories of claimants entitled to recover damages for nervous shock must be limited to those in relationship that involves “close ties of love and affection”.

On this point, their Lordships did indeed leave trial judges with the unenviable task of establishing (as a matter of factual evidence) whether this test was fulfilled in any particular case. This is no doubt a difficult task which is bound to provide some incorrect judgments, but surely no less difficult than the courts’ everyday obligations to decide whether civil actions were done fraudulently, whether a defendant is mentally unfit etc. My point is that, despite the difficulties involved in such an assessment, this is precisely the kind of fact-based analysis which the courts are designed to perform and which their Lordships were happy to entrust to trial judges. However, their Lordships appeared 51

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dissatisfied with allowing trial judges unfettered discretion on this question. They decided, as a rule of law, that certain relationships would be automatically recognised as being ones that involve “close ties of love and affection” (parents and children, spouses and fiancées) whereas others would require claimants to bring evidence before the court to establish their close ties of love and affection with the victim (siblings, friends etc.) This hard-and-fast rule could lead to some very strange conclusions. A married couple who are known to despise each other are, a day before their divorce is finalised, still as a matter of law presumed to have ones involving “close ties of love and affection”, whereas two sisters are not, even if they are very close in fact. Likewise, a couple which does not believe in marriage but has lived happily with each other for 50 years would still not benefit from the presumption that their relationship was one involving “close ties of love and affection”. Surely the courts are properly (and best) equipped to deal with evidence which would distinguish these cases as a matter of fact and do not require to have a conclusion imposed upon them from on high as a matter of law? Is life, and are relationships, not sufficiently complicated to make it an inadequate legal solution to simply draw a line between relationships which benefit from such a presumption and those that do not? Is it not an affront to common sense for grandparents who have lovingly raised their grandchild since birth (having won a legal battle to deprive his biological mother – a drug addict – of custody over the child) to discover that English law automatically presumes them to have “close

ties of love and affection” with their daughter (with whom they have no contact – and do not wish to have – for many years), whereas the same presumption does not apply to the grandchild they have raised and adored since birth?

Regardless of your personal convictions on this question, I hope that their Lordship’s next conclusion can be considered by almost everyone as curious, at the least, if not downright pernicious. Faced with a claimant who had been at Hillsborough with his brothers, whose deaths he had witnessed at firsthand (in fact, the surviving brother was trapped face-to-face with his brother as he died over a period of time, unable to even fall to the ground), their Lordships decided that, since the relationship

between siblings is not one which should as a matter of law be presumed to involve “close ties of love and affection”, the claimant brother was required to bring evidence to the court to establish that such ties existed with his deceased sibling. On the facts of the case, this would not have been difficult for the claimant – he enjoyed a close, life-long relationship with his brother and they regularly met together on social occasions, including attending football games together. The problem, however, was that their Lordships’ requirement for evidence to be adduced during the first-instance trial only came into existence upon appeal (i.e. after the case had already been heard by the first-instance 52

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court and Court of Appeal). In such circumstances, it was impossible for the claimant to go back in time and introduce this evidence during the first-instance case in order to comply with a rule of law which (until their Lordships handed down the Alcock judgment many years later) no one was even aware existed. If the claimant had known at the time of the first instance trial that he was required to adduce evidence to establish his “close ties of love and affection” with his brother, he would surely have done so. He did not because he was unaware that this was necessary – and in this he was not alone, since even the most reputable tort law lawyer

was

requirement Lordships’

unaware until

gave

of

after

judgment.

this their The

ridiculousness of the situation would be no less if their Lordships had suggested that claimants in nervous shock cases must wear red socks during the first-instance trial. As a legal requirement to succeed in a tort claim, this rule would

inevitably be assessed with different degrees of satisfaction by various commentators (as has been the rule of law which deprives siblings of the presumption that they had close ties of love and affection with each other). However, even those who disagree about the validity of the rule per se would surely unite in criticism of a highest appeal court which appears to impose the requirement ex post facto on a particular claimant. To deny a claim on the basis that the claimant failed to comply with a rule which was only noted (some may say “invented”) by the highest appeal court after the event is, to put it mildly, grossly unfair.

There are numerous other aspects of the Alcock case which are capable of criticism, but the

constraints of this short article preclude the possibility to discuss them in full. For the purposes of the present analysis, it suffices to say that this author considers the House of Lords’ ruling in the Alcock case to have been intellectually and logically flawed on a number of key legal issues.

If that were the end of this article, it would be a depressing conclusion indeed. However, as you may have guessed from its original paragraphs, a number of significant victories have taken place this year.

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These victories are the final step on a lengthy and heart-breaking journey which the families underwent for 27 years. Many of the steps before this were equally as traumatising for the victims’ families as those described above. For example, when their perseverance led to the minor victory of Lord Justice Stuart-Smith (a Court of Appeal judge) being asked to undertake a “scrutiny” of the Hillsborough disaster, this victory was short-lived when it transpired that Stuart-Smith’s role would be to assess “new evidence” and he would not be allowed to review any evidence which had already been heard by either the coroner or the courts. Naturally, this limitation effectively undermined the very sense of organising such a “scrutiny”. Stuart-Smith was seen as being determined to “rubberstamp” the earlier findings made in relation to the tragedy and his approach was seen as dismissive to the victims from the very first day. When he asked the father of a deceased victim whether he was alone or planned to have other family

members join him (adding that, if so, he hoped they were not like LFC fans who “turn up at the last minute”), his credibility was tattered from the very outset. Unsurprisingly, StuartSmith’s conclusions were in line with those that had gone before and he concluded that no new inquiry into Hillsborough was necessary. However, the rules of the “scrutiny” enabled the victims’ families to have access to “old evidence” which – despite the fact that it was inadmissible in the “scrutiny” – allowed them to see, for the first time, the evidence which had been falsified, was inconsistent and which bore all the hallmarks of a “cover up” by the police.

Following further campaigning by the families, the government agreed to create a Hillsborough Independent Panel to evaluate thousands of documents and produce a report on whether the events surrounding Hillsborough had been properly reported. The two-year review of over 450,000 pages of materials ended in a report which absolved LFC fans of any blame for the disaster and concluded that 41 of the 96 who died that day had a chance of survival if they had received medical care earlier. The Panel discovered and disclosed 164 witness statements which had been altered, of which 116 had 54

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been amended to remove negative comments about South Yorkshire Police. The coroner's verdicts on the deaths of the 96 victims were changed to "unlawfully killed".

The conclusions of the Hillsborough Independent Panel led the government to open a new inquiry into the disaster. The inquiry was chaired by a High Court judge (Lord Goldring), but the judgment was handed down by a jury. This inquest lasted for more than two years and is, to date, the longest jury case in English legal history. On 26th April 2016, the jury reached a series of conclusions which confirmed that police negligence was directly responsible for the 96 deaths at Hillsborough. The jury also found Sheffield Wednesday (i.e. the football club which owns Hillsborough), the emergency

medical services and the stadium’s safety inspectors shared the blame for the tragedy, but it made no mistake about laying the ultimate blame for those deaths at the door of South Yorkshire Police. The inquiry’s finding of “unlawful killing” confirmed that Chief Superintendent David Duckenfield owed a duty of care to the 96 who died, that he breached that duty of care, that this breach caused the deaths and that the breach amounted to "gross negligence." Although the inquiry had no power to make findings about criminal liability, the Crown Prosecution Service (CPS) may initiate prosecutions against either individuals (such as Mr Duckenfield) or corporate bodies (such as the South Yorkshire Police, or Sheffield Wednesday FC) and a full criminal investigation into the disaster remains ongoing.

A number of proposals for legal reform have arisen since the findings of the inquiry in April 2016.

Some of these focus on the need to endure that government funding is available to financially assist

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those, such as the Hillsborough victims’ families, who are engaged in lengthy and expensive litigation against state-financed institutions, such as the police. Others seek reform of the manner in which coroners’ inquests are conducted. Others focus on procedural and institutional reforms to the police, especially when allegations of negligence have been made. Others seek to prevent police officers from retiring and avoiding the consequences of investigation/punishment by the Independent Police Complaints Commission (as did Mr Duckenfield and a number of other officers involved at Hillsborough).

Although the aforementioned rules on the recoverability of damages for nervous shock laid down in

the Alcock case are not intended to be limited in application to the Hillsborough tragedy (and need not logically be changed due to the 2016 inquest findings), this writer hopes that the positive spirit and relief which the inquest has provided will lead to a re-think of these rules. At present, these rules are arbitrary, illogical and capable of producing extremely unfair conclusions based on unjustifiably rigid criteria. A thoughtful review and adaptation of the 1991 Alcock judgment is as necessary as the findings of the 2016 inquiry itself. It would certainly be a non-sporting victory which this writer would cheer.

However, the true victory in this story lies in the fact that the families of 96 people who were unlawfully killed, then subjected to a cover-up which saw them blamed for their own deaths, can finally

rest

in

the

knowledge that the truth is finally known.

Their passion

perseverance, and

dignity

can serve as a lesson to us all, whether inside or outside the

legal profession. Each of them has confessed that, at times, they felt like giving up yet, on each such occasion, they found the strength in themselves, and in each other, to continue their struggle and see it through to a successful conclusion. There is a lesson in there for each of us. In the famous words that are inscribed above the Hillsborough memorial at LFC’s stadium in Anfield, “You’ll Never Walk Alone”.

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New rules on termination of employment contracts in Poland Mateusz Gajda BLC Student 2nd Year Warsaw 22 February 2016 marks the date of

entry

into

force

of

new

provisions of the Polish Labour Code

concerning

contracts.

One

employment of

the

most

influential changes is an extension of the termination notice period for

fixed-term

employment

contracts. Pursuant to the new provisions, the duration of notice

periods depends only on the length of the employment relationship with the employer. This amendment is the result of the judgment of the European Court of Justice (ECJ) in Case C38/13.

According to the view of the ECJ, provisions of the Polish Labour Code concerning termination of employment contracts gave rise to a form of discrimination on the basis of the type of agreement concluded.

According to the Polish Labour Code, the duration of the period of notice for an employment contract for an indefinite period of time is based on the length of the employment relation with the employer.

Particularly, the duration of the period of notice for an employee who has been employed for: a) less than 6 months, amounts to 2 weeks, b) at least 6 months, amounts to 1 month, c) at least 3 years, amounts to 3 months. In the case of an employment contract concluded for a definite period of time, the relationship between the employee and the employer – as a principle -

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ends after the expiry of the period for which the contract was concluded. Pursuant to article 33 of the Polish Labour Code - which is no longer in force - in cases of employment contracts concluded for a definite period of time longer than 6 months, the parties of the agreement could include a provision providing a possibility for early termination. In such a case, the duration of the notice period was two weeks. Such an approach was generally justified by the fact that only a contract of employment for

an indefinite period of time functioned stability

of

to the

promote

the

employment

relationship between the parties.

In the context of the highly flexible Polish labour market, employers

frequently

offered

employees contracts of fixedterm employment which took advantage of the possibility of early termination after 2 weeks’ notice.

That meant that employers could terminate contracts of employment with employees performing work under fixed-term agreements faster than in the case of employees who had worked for the same period of time but under indefinite term contracts.

A Polish court decided to request a preliminary ruling concerning the interpretation of the provisions of the Framework Agreement on fixed-term work concluded on 18 March 1999. Importantly, one of the main aims of the Framework Agreement is to ensure that fixed-term employment contracts are not used in a manner that facilitates the abuse of power by employers. Moreover, the Framework Agreement emphasizes the necessity of the application of the principle of non-discrimination. The ECJ issued a judgment which determined that some of the provisions of the Polish Labour Code were inconsistent with Council Directive 1999/70/EC of 28 June 1999. For this reason, from 22 February 2016, the duration of the notice period for fixed-term contracts of employment and employment contracts for an indefinite time are the same and depend on the length of the employment relationship with the employer.

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The Duomatic Principle Explained...

Ruairi ONeill BLC Tutor

The Duomatic principle, otherwise known as the unanimous consent principle, was established in Re Express Engineering Works Ltd [1920] 1 Ch 466, which was applied in Re Duomatic Ltd [1969] 2 Ch 365, which now lends its name to the principle. That particular case concerned the validity of payments made to directors of a company for their personal benefit, in the absence of a formal resolution or permission under the company constitution. Buckley J, at page 373C, held that the payments were to be treated as properly authorised because they were made with the full knowledge and consent of all the shareholders entitled to vote at the relevant time.

Thus the rule provides for informal unanimous consent by all shareholders who would otherwise be entitled to vote at a general meeting on a matter that would be given effect at a general meeting.

As a common law principle, there have been attempts to codify it in statute; for example, Paragraph 2.14 of the Company Law Steering Group Review proposed that the rule should be codified in the Companies Act 2006 (CA 2006), and defined it as expressly allowing the shareholders, acting unanimously, to make any decision which it has power to make, without having to observe any

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formalities required either by the Act or by the company constitution. Thus the codified rule would have the same effect as a resolution of the company.

Furthermore, Paragraph 7.17 of the Review accepted

that

the

rule

is

particularly

important for small companies, on the basis that many decisions are made by unanimity and in good faith anyway (Paragraph 7.19).

The CA 2006 did not, however, codify the principle, but it also didn’t say it had been abolished! Instead, at Section 281(4) CA 2006, the Act indicates that it does not affect any rule of law that permits decisions done otherwise than by passing a resolution.

Explanatory Note 523 to the Act clarifies that this preserves the Duomatic principle. What

this means is that company directors and lawyers still need to refer to the case law on the principle to determine the scope of its application.

For example, in Re Home Treat Ltd [1991] BCLC 705, Harman J accepted that unanimous consent is as good as a special resolution, which includes situations of acquiescence in full knowledge by the shareholders. Also, in Monecor (London) Limited v Euro Brokers Holdings Limited [2003] EWCA Civ 105, Mummary LJ described the rule as a sound and sensible principle of company law allowing for agreement without the need for strict compliance with formal procedures, and allowed it to be applied to shareholder agreements. In Wright v Atlas Wright [1998] BCC 163, the court looked at the purpose

of the relevant statutory provision governing approval of directors’ service contracts, and concluded that, since the provision aims to protect shareholders, the Duomatic principle could be applied. The method of assessing the purpose of the statutory provision was applied again in BDG Roof-Bond Ltd v Douglas [2000] BCC 770, where it was held that the statutory rules on share buy-backs were designed to protect shareholders, so again the Duomatic principle was held to apply. Finally, in Hussain v Wycombe Islamic Mission and Mosque Trust Ltd [2011] EWHC 971 (Ch), the principle was applied to

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validate the adoption of a revised company constitution.

These cases all show where the rule has been held to validate the informal actions of the members, but it is equally important to have a clear understanding of when the rule does not apply. In SSBIS v Doffman, Re Stakefield Ltd [2010] EWHC 3175 (Ch), three limitations to the principle were identified:Situations where the interests of third parties need to be considered, such as: 

when the board of directors must consider the interests of creditors due to the poor financial health of a company, thus applying the rule from Atlas Wright v Wright [1999] EWCA Civ 669, which held that the purpose of the statutory provision needed to be considered.



Similarly, Duomatic doesn’t applies to procedures which don’t aim to protect shareholders but third parties, including the validity of the buy-back of shares, as in Re RW Peak (Kings Lynn) Ltd [1988] BCC 596, where the Court held that the statutory buy-back provisions were designed to protect third party interests so shareholders shouldn’t be allowed to waive them.



It was stated obiter, but Sheldon QC in Bonham-Carter v Situ Ventures Ltd [2012] EWHC 230 (Ch) considered that it may not be possible to use the Duomatic principle to remove directors, since Section 169 CA 2006, which gives directors the opportunity to make representations at a meeting to remove a director, is designed for the protection of directors and not shareholders.

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Furthermore, situations where the shareholders had not been made fully aware of a proposal and agreed to it, as in Schofield v Schofield [2011] EWCA Civ 154, fall outside the scope of application, such as where the director-shareholder was held not to have consented to a meeting to dismiss a director in contravention of the rules on calling such meetings in Section 307 CA 2006. An objective analysis needs to be conducted by the court to determine that the shareholders’ agreement was real and unqualified, as in Bonham-Carter v Situ Ventures Ltd [2012] EWHC 230 (Ch), where it was held that filing forms to remove directors was invalid on the basis of a mistaken belief that they had resigned.

Finally, the principle cannot be used to ratify situations when a formal resolution also would not have the same effect: in Re Frontsough (Witham) Ltd [2011] EWHC 1668 (Ch), it was considered, obiter, that the shareholders may not have the power to usurp the general power of the directors to put a company into administration.

Thus, after considering the case law, the Duomatic principle (or unanimous consent principle) is not strictly representative of its name. Its purpose is obviously to allow flexibility in the decision-making of shareholders and not to place an over-reliance on procedural requirements and formalities. But there are instances where the principle cannot allow the shareholders to unanimously by-pass formal procedural rules. Do you have such a rule in your legal system?

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The Academy of Good Law Aleksandra Cięścik BLC 2nd Year Student Warsaw Centre Being an extraordinary and promising law student takes a lot of effort. Great achievements are more likely to be at your fingertips when you are talented, but they would never come to life if it wasn’t for hard work. It does not always have to mean sleepless nights with textbooks and carefully taken notes.

What if you could enrich your knowledge in a specific field of law by participating in a special programme addressed to outstanding individuals?

The Academy of Good Law is an initiative, which derives from the Jagiellonian Club, a think-tank with a long-standing tradition. Through the years, it could be easily observed that there is a tendency to forget that being a lawyer carries more than just a name, that there is the key to being a part of this association. This is why the main aim of the programme is to confront different ideas among the participants, refresh the ethos of the legal culture and explain what it means to be a lawyer. What is more important for the students, the Academy is an opportunity to develop advocacy skills under the tutelage of experienced professionals. The exchange of ideas enriched by practical abilities create a perfect combination for a future legal master.

What else makes a perfect lawyer? Most certainly, a thirst for knowledge. It means that in order to be successful and being able to have an understanding with clients, it is necessary not only to be well versed in law but also to have a general idea about different fields where law applies. What is more, a lawyer needs to require from the others but especially from himself or herself. Knowing the issues, the Academy of Good Law tends to imply them in its programme and encourage young beginners to develop them on their day-to-day basis.

This year’s edition subject holds for new technology, an area still uncovered, which is nevertheless dynamic and prospective. It may seem that such technical field is destined to be approached by IT workers only. However, this way of thinking is completely erroneous. One of the strongest represented professions in the new technology sector is lawyers. Currently, for many students, it is almost impracticable to gain additional experience in areas different from those taught at the University. This situation may be saddening, especially taken into account that the beginners are more likely to crave

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diversified possibilities to choose from. This is why the Academy of Good Law has been created - to give opportunities for the outstanding individuals, who strive for more than the bare minimum of what the programme of their studies has to offer.

One of the advantages of our project is its formula two stages in which we

focus on specific issues chosen by the organisers.

During the first one, we invite our participants to take part in lectures given by

the

experts

in

presented subjects. This year we will approach the controversies around the Constitutional Tribunal and the South China Sea. The latter will be carried out for three days at the centre outside Warsaw. During the first day we will concentrate on presenting different aspects of the new technology law. During the second day the panel of experts and practitioners will concentrate on passing their advocacy skills to the participants.

The additional advantage of the seminar will be a training course, followed up by a moot court. Its case will focus on the most intriguing aspects of new technology law, which is a great opportunity to apply the participants’ knowledge in practice.

Speaking of partners - the Academy of Good Law is organised by experts in both fields, IT and law, including Wardyński and CMS. By sharing their experience through lectures and workshops, they encourage the students to be more active and aware outside their studies. Our group is of a limited

number of members in order to assure that the trainings are focused on active participation of the young beginners.

We strongly encourage you to apply for this project. It will not only be the source of new skills and abilities, but also a great opportunity to meet people who share the same interests and are willing to exchange their points of view with others.

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Flying Pizzas A whirlwind tour of some of the safety implications of the rise of the drones Will Odogwu BLC Tutor

Those loveable product-launch lab rats of humanity have stepped up to the plate once again. Within weeks of one man quitting his job to devote himself full-time to “going out into the world to hunt Pokemon” and another obliviously pounding on the iron gates of the local Hells Angels HQ in search of the furry mini-monsters, New Zealand is now to become an outsized petri dish for a far more conventional product – pizzas. Yes, there is a twist, delivery will be by far from conventional means – namely, by drone. The prospect of pleasantly rotund farmers in the backblocks of New Zealand watching Flight of the Concords episodes while devouring freshly baked Domino’s pizza whisked from

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the city to their front gates in the proverbial blink of an eye seems the perfect opportunity for a whirlwind tour of some of the headache-inducing regulatory issues arising from the skyrocketing number of drones in our skies. Below I touch upon a few of the safety issues that arise and some of the regulatory responses that have been adopted. In a later contribution, attention will be turned to the perhaps rather more far-reaching privacy implications of the new technology.

Danger in the skies Not surprisingly, if so-called ‘bird strike’ can bring down a large aircraft, then so too can collisions with drones—or ‘unmanned aerial vehicles’

(UAVs).

Chesley

‘Sully’

Sullenberger, the pilot who saved 155 souls by miraculously landing on

the Hudson River after striking a flock of geese, has already suggested that a similar incident involving a drone collision is a matter not of if but when.

Nevertheless, so far the greatest collision dangers have arisen in a somewhat different context to the nightmare scenario involving passenger jets. Firefighting aircraft tackling huge wildfires in the western states of the U.S. are repeatedly being grounded due to the activities of curious hobbyists flying their recreational drones into the airspace above blazes. There were 6 documented groundings last year (one of which was for 20 hours) and the pattern continues this year. One notorious example in California involved a wildfire that eventually went on to kill an elderly couple and destroy 150 homes.

In July, charges were brought against a California man in connection with a separate incident.

Problems of this nature are also arising increasing in ridiculously flammable Australia. Given that drone footage of fires rampaging across Portuguese landscapes is already circulating on the internet, it can be assumed that this problem also poses risks for those regions of Europe that are vulnerable to forest

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fires. Firefighting aircraft are particularly susceptible to collisions with drones given that they fly low in

poor visibility conditions and pilots are general focused on positioning their aircraft to make maximally efficient drops of fire retardant rather than on hazards in the air.

Forest fires might be a rather remote concern for most inhabitants of generally cool and damp northern Europe, but risks arising from the possible use of drones to perpetrate terrorist attacks or to penetrate secure facilities do pose special concerns. Then of course there are the more humdrum scenarios of UAVs getting away from their operators due to problems with communications and running amok over busy streets or crowds of music festival goers, colliding with goodness knows what or whom.

Domesticating drones – the regulators Besides targeted rules appearing in recreational drone-use regulations prohibiting flying in proximity to such fires, a set of common general measures have been adopted by regulatory agencies in many countries. These include imposing low flight ceilings (120 metres has become the standard in many jurisdictions) and prohibitions on flying in close proximity to airfields and airports. It has also become commonplace for a ‘line of sight’ requirement to be imposed, i.e. a requirement that the operator of

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the drone (or someone in constant communication with that person in the case of New Zealand) be able to see the drone at all times during its flight. Regulations of this nature make it inevitable

that

anyone

interfering

with

firefighting operations or posing a hazard to planes shortly after take-off and during the final approach for landing will find themselves

liable to prosecution.

However, the reassuring picture just presented belies the real concerns as regards the difficulties in enforcing the regulations and detecting those who flout them. Mandatory registration for drone operators may go some way to ameliorating these difficulties and this approach has been adopted in the United States for all drones that exceed the miniscule weight of 0.25 kg.

New Zealand has, in

contrast, adopted a ‘light touch’ approach and requires registration only for drones exceeding 25kg. But in most jurisdictions, activities thought to pose special risks, such as flying drones (irrespective of their weight) at night or over large crowds and densely populated areas, requires special authorisation by the regulatory authorities. New Zealand again sits at the most permissive area of the spectrum given that flying drones over people requires no special certification, but only the consent of the people who will be overflown. This divergence in approach also extends to commercial

operators of drones, who in all other jurisdictions are subject to special requirements as regards registration and the certification of drone operators, which no doubt goes some way to explaining the enthusiasm of operators such as Domino’s pizza for the land of the kiwi. The absence of speed limits on drones in New Zealand—in contrast to the U.S. and most other jurisdictions—may also help that outback farmer get their pizza that much quicker!

The impression created by a focus on closely-defined rules and distinctions is however likely to obscure the bigger picture. There are often general regulatory principles in place that are applicable across the 68

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board and which mean that compliance with technical rules will not necessarily keep one within the bounds of the law. In New Zealand for example, even if an operator complies with all the rules, they

are still obliged to ensure that they do not operate their UAV in a “hazardous manner.� Accordingly, cavalier UAV operators are likely to be caught by such catch-all provisions even if more technical rules have been successfully skirted. Besides sui generis rules, there are of course also general systems of tortious liability in place and in the specific context of common law jurisdictions, it can be readily anticipated that the law of negligence or nuisance will provide possibilities for the pursuit of compensation by anyone suffering loss due to the operation of UAVs regardless of the situation as regards criminal liability.

Bringing the mavericks to book

Despite the difficulties in apprehending reckless individuals posed by the nature of drone technology, authorities have successfully imposed fines and even achieved convictions for more serious transgressions. Three New Zealanders were fined under the regulatory framework in force up until last year—one man for flying a drone over Auckland at night and two other operators for operating their drones in close proximity to airports. One of the most serious incidents, which resulted in prosecution and conviction of the individual in question, transpired in the United Kingdom. In The United Kingdom Civil Aviation Authority v Robert Knowles (unreported, 2014), Mr Knowles lost remote radio contact 69

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with his drone when operating it in circumstances that were otherwise safe (i.e. over a large city park).

For three minutes the drone flew out of his control. But during this time it flew within 50m of a bridge and over a nuclear facility. Mr Knowles was fined ÂŁ800 plus court costs of ÂŁ3,500. The situation of the California

man

impeding

firefighting

efforts

already discussed will of course also be recalled.

Learning to embrace a future populated by drones Hard and fast rules and the imposition of liability have not distracted regulators form more soft touch approaches however. Aviation authorities in all

the

significant

leading efforts

jurisdictions towards

have

directed

public education

campaigns and ensuring that guidance on safety issues is readily accessible and presented in a

simplified manner. This is no doubt entirely sensible given that the vast majority of incidents likely arise from simple ignorance among drone operators regarding the dangers to which others may be exposed by their activities and the strategies that can be adopted to minimise such risks.

Finally, it is important not to lose sight of the brave new future which may be made possible by drones and their capabilities. How long will it be before the dangers of drones colliding with firefighting aircraft are superseded by the wholesale replacement of such aircraft by unmanned drones? What of

those people who presently live out of reach of medical care and who could in the future perhaps be easily reached by increasingly affordable drones bearing lifesaving medicines? Drones are no doubt here to stay and the safety challenges that they pose seem far from insurmountable. NASA is presently developing a flight control system which will monitor UAV traffic and law enforcement authorities have already shown their ability to apprehend reckless users. But the puzzle arising out of the privacy and surveillance implications of drones may raise far deeper questions for our societies and how we want to live. Stay tuned for the next edition and a brief overview of concerns in the field of privacy.

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In this section contributors are given the opportunity to write about EU law-related issues, ranging from software piracy, European companies, and consumer protection

SOFTWARE PIRACY

EU & INT’L LAW ISSUES

Gabriela Stoyanova, BLC Alumnus Sofia Centre

The software industry is the world’s fastest growing highly globalized field, and a major source of growth for the EU. The ICT sector accounts for a substantial part of the EU’s GDP and employment, and stimulates productivity and competitiveness in all areas of economic activity. An industry with this kind of potential needs legal certainty and a stable framework for its proper functioning. Though supporters of the ‘Software Patent’ see the US software industry as a successful example that would be instructive in creating an EU Software Patent, the main instrument used to date to protect software throughout European Union is Copyright Law.

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Types of Software Piracy Software piracy is the illegal copying, distribution, or use of software.

Some common types of software piracy include: Corporate Software Piracy – corporations reproducing copies of software without authorization; Counterfeit Software - fake copies of software produced in such a way that they appear to be authentic; OEM unbundling - OEM-packaged software is separated from the hardware it originally came bundled with by retailers; Softlifting - a legally licensed software program is installed or copied in violation of its licensing

agreement in order to provide the program to multiple users; Hard disk loading – manufacturers or resellers of computers load illegal copies of software onto hard disks to make the purchase of the relevant hardware more attractive; Internet Software Piracy - software illegally obtained through Internet channels, usually through peer-to -peer file sharing systems or downloaded from pirate web sites.

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The EU Directives Legal instruments, such as the Directive on Enforcement already exist in the EU to prevent the

infringement of intellectual property rights.

The Directive on the enforcement of intellectual property rights (IPRED) requires EU member states to apply effective remedies and penalties against those engaged in copyright infringement. It requires all Member States to apply effective, dissuasive and proportionate remedies and penalties against those engaged in counterfeiting and piracy.

The agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), has also assumed a crucial position in the fight against piracy.

Barriers to enforcement According to the BSA (also styled ‘The Software Alliance’) the principal barriers to the effective enforcement of IPRs are the complex legal proceedings and inefficient tools available for the collection of evidence (evidence in software piracy cases can be deleted using a few key-stokes). For this reason, the industry relies on surprise searches and seizures to secure evidence of theft. However not all Member states have civil search mechanisms implemented in their national laws.

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On the other hand, the industry group representing Internet Service Providers (ISPs) in Europe sees some of the technical measures aimed at procuring compliance with IP rights, such as website blocking as "possibly repressive" and inefficient. According to this body, Internet access is a “fundamental right”. The European Union adopted an Internet freedom provision, stating that any measures taken by EU member states that affect a citizen's access to the Internet "must respect the fundamental rights and freedoms of citizens". The case law of the Court of Justice of the European Union has coherently communicated the principle that ISPs should not be required to install "mandatory network-level filtering" systems to prevent illegal downloading as this constitutes a serious infringement of their freedom to conduct business (C-70/10 Scarlet Extended, Judgment of 24 November 2011).

It should be remembered that tackling Software Piracy is essential for the economic and societal wellbeing of the citizens of the EU, as Software Piracy means the loss of tax revenue and jobs. It also harms consumers who expose themselves to hidden cyber security threats, malicious code, Trojan horses, and other infectious computer code. At the same time, consumers are also involved in criminal activity as contributors to software piracy.

Given this uncertain time, politically, legally, culturally: we thought we give you a round-up of some Brexit jokes doing the rounds on the interweb: 

Why does Britain like tea so much? Because Tea leaves



An Englishman, a Scotsman and an Irishman walk into a bar. The Englishman wanted to go so they all had to leave



Heard the news that UK has decided to reduce the number of vowels in the English alphabet? It only wants to keep a, i and o. It is throwing out e and u 74

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The impact of EU Directives on the EU market A comparison of the Polish and the English Consumer Rights Acts Piotr Warchol BLC 2nd Year Student, Warsaw

The EU Consumer Rights Directive 2011 obligated the all EU Member States to implement provisions aimed at better protecting the interests of consumers on the EU market. The Polish and the English legislation mentioned below serves as an example of that implementation in two member states.

General consumers’ rights under English legislation are covered by the Consumer Rights Act 2015 (hereafter “CRA 2015”) and The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (hereafter “CCR 2013”). The equivalent Polish regulations are stipulated in The Consumer Rights Act 2014 (hereafter “CRA 2014”) and the Civil Code (hereafter “CC”). In these statutes are comprised two important rights for consumers: the right to reject the goods and the right to cancel the contract. These two rights will be the subject of comparison below.

There are also other English statutes besides that mentioned above which set out consumer rights, e.g. the Consumer Protection Act 1987, the Contracts (Rights of Third Parties) Act 1999, but these are beyond the scope of the present comparison.

This article will also not describe every right given to consumers by the two Acts to which attention will

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here be directed. The general purpose of the present comment is to compare one of the most important consumer rights which appears in both bodies of legislation – the Polish and the English, and underline any differences that exist.

The right to cancel the contract.

There are very similar provisions in the Polish and the English Acts about the circumstances in which the consumers have a so-called ‘cooling off period’. The first important circumstance is that those rights exist only when the contracts made between traders and consumers are either off-premises

contracts

or

distance

contracts. In other words, if the contract is made on business premises the consumers will not be entitled to cancel the contract on the grounds of these provisions (section 29 CCR 2013 and art. 27 CRA 2014).

The period within which the consumers have the right to cancel an off-premises contract or a distance contract is 14-days. Both bodies of legislation – the Polish and the English, are consistent in this matter.

This period will generally start from the day after the day on which the goods come into the physical possession of the consumer if it is a sales contract, or the day after the day on which the contract was made if it is a contract for the supply of digital content not supplied on a tangible medium, or the day after the day on which the contract was made if it is a service

contract (section 30 CCR 2013 and art. 29 CRA 2014).

There is a significant exception in both bodies of legislation as regards the period in which the consumer is entitled to cancel a service contract or a contract for the

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supply of digital content not supplied on a tangible medium. This exception applies where a consumer expressly requested to start a service contract or to be supplied with digital content that is not on a tangible medium within the cancellation period – 14 days, and has acknowledged that by this he has lost the right to cancel the contract (section 36-37 CCR 2013 and art. 38 CRA 2014).

Right to reject faulty goods.

In both the English and the Polish legislation consumers have rights to be supplied

with

goods

which

are

of

satisfactory quality, fit for purpose and compatible with the description provided by the trader. If the goods provided by a trader do not fulfil these requirements, the consumer generally has a right to reject the goods, to receive a price reduction, or to repair or replacement of the faulty goods.

In the English legislation, the time limit for the rejection of faulty goods is 30 days from the day after the day on which the contract was made (section 22 CRA 2015). It does not mean that consumers are forced to reject the goods as a first choice. This period stops running when a consumer chooses, as a first request, to repair or replace the faulty goods (section 22(6) CRA 2015). However, after that option has been selected, a consumer’s right to reject the goods will be constrained and before final rejection can be elected the trader must be given the opportunity to

repair or replace the faulty goods in reasonable time and without significant inconvenience to the consumer (section 23 and 24(5)(a) CRA 2015).

If the goods cannot be repaired or replaced within a reasonable time and without significant inconvenience to the consumer, the consumer will have the right to final rejection or a price reduction (section 24 CRA 2015).

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Perhaps the most significant time limit for the consumer is the period of six months after purchasing the goods. Within this time, the onus to prove that a fault affecting the goods was not present at the time of purchase is on the trader (section 19(14) CRA 2015). After that period elapses the consumer will be obliged to prove that the fault was present at the time of purchase, which could be difficult for a consumer without professional knowledge in the relevant area.

There is no time limit for consumer action stipulated in CRA 2015. Therefore, the general time limit for an action founded on simple contract will be applicable which is six years from the date on which the cause action accrued (section 5 Limitation Act 1980). It does not mean that goods should last six years, but it is the time in which a consumer will be entitled to make a claim. Although, as we mentioned above, after six months the consumer will have to prove that the fault affecting the goods was present

at the time of purchase and the length of time elapsed from the day of purchase will be a significant circumstance. In other words, the elapsed time works against the consumer.

The provisions mentioned above are also applicable to second-hand goods as if the consumer was purchasing new goods, subject of course to the requirement that they are bought by a consumer from a trader.

In the Polish legislation there are similar rights which can be utilised by a consumer but there are 78

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different terms and restrictions applying to the rights elected. Firstly, the consumer is not constrained to any specific time period within which he can choose to reject the goods. Therefore, he can choose to reject, repair or demand replacement of the faulty goods. At this stage the trader is obligated to fulfil the consumer’s request unless compliance with the remedy chosen by the consumer is impossible or the cost of doing so is disproportionate to the remedy offered by the trader (art. 560 CC). Factors relevant to assessing whether the remedy is disproportionate include the value of the goods, the significance of the fault and the inconvenience to the consumer arising from the alternative remedy offered by the trader.

The one significant time limit for consumer actions is the term of one year after the purchase of the goods. After that term has elapsed, the onus to prove that the fault was present at the time of purchase is on the consumer (art. 5562 CC). With the exception of the length of the term in question, the presumption is similar to that in English law.

The second important time limit is the term of two years after the purchase of the goods within which the trader may be liable for a fault affecting the goods (art. 568 CC). If within this period the goods turn out to be faulty, the consumer will be entitled to invoke one of the abovementioned rights. The consumer is obligated to exercise his rights within one year from the day that the fault was exposed, but this time limit cannot elapse for so long as the term of the trader’s liability continues – as we mentioned above, this is two years after the purchase of the goods.

As to second-hand goods, there is also a significant difference as regards the time limit within which the trader is liable. This term can be reduced to one year if the trader informs the consumer about this 79

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change before the contract is made.

Conclusions.

From comparison of only the two abovementioned rights it can be concluded that some aspects of these rights are very similar in both the English and the Polish legislation, and that others are characterised by greater difference. It could be the result of the different history of laws and customs in both countries.

Therefore, the Consumer Rights Directive introduced by the EU in 2011 and other relevant European consumer directives stipulate only a framework or rather a minimum level of protection for all EU consumers. As a result, every EU Member State enjoys some latitude to choose which right to extend

to what specific extent.

This has a great impact for consumers on the EU market. Even if the extent of some rights is not the same in different EU Member States, the most important factor for consumers is awareness of the very existence of rights. The awareness that in the same circumstances as in their own country they have similar rights and that they need only ask or seek information as to how these rights are applied in the EU member state in which they find themselves is primary. With this awareness, consumers are better protected and accordingly the main purpose of the harmonisation of law in the EU is furthered.

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What changes lie in store for e-commerce with the introduction of the EU Regulation on consumer ODR? Bartosz Dobkowski BLC 2nd Year Student, Warsaw

On 9 January 2016 Regulation No 524/2013 of the European Parliament and of the Council of 21 May 2013 on online dispute resolution for consumer disputes and amending Regulation (EC) No 2006/2004 and Directive 2009/22/EC (hereinafter referred to as the “Regulation on consumer ODR” or the “Regulation”) became applicable, bringing new requirements both for traders engaged in online sales or service contracts and online marketplaces.

The Regulation laid down foundations for the establishment of the European Online Dispute Resolution Platform (“ODR Platform”) – a tool designed to provide consumers and traders with the opportunity to settle their disputes arising out of contracts concluded online without resorting to court litigation.

The Regulation on consumer ODR sets forth a four-stage dispute resolution process that is conducted entirely online. The procedure is initiated by the consumer or trader filling in the electronic complaint form. Subsequently, the ODR platform directs the submitted complaint to the respondent party, who proposes an ADR entity to handle the case. Once the parties have reached an agreement as to which ADR entity shall settle their dispute, the ODR platform transfers the compliant to that entity. The final stage consists in the ADR entity resolving the dispute. The outcome of the ADR procedure shall be made available within a period of 90 calendar days from the date on which the ADR entity has received

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the complete complaint file. However, a competent ADR entity will have discretionary power to extend this period in the case of a highly complex dispute.

Under the Regulation, traders engaging in online sales or services and online marketplaces (subject to the caveat that they are established within the EU) are obliged to provide on their websites an electronic link to the ODR platform. The Regulation requires that the link be “easily accessible� for consumers. Moreover, traders engaging in online sales or services must state their e-mail addresses.

Specific requirements are imposed upon traders committed or obliged to use one or more ADR entities to resolve disputes with consumers. Pursuant to the Regulation, they are under an obligation to: (a) inform consumers about the existence of the ODR platform and the possibility of using the ODR platform for resolving their disputes, (b) provide an electronic link to the ODR platform on their websites and, if the offer is made by e-mail, in that e-mail. The information shall also be provided, where

applicable, in the

general terms and conditions applicable to online sales and

service contracts.

The ODR platform is intended to guarantee a quick and inexpensive procedure for seeking redress. Time will tell whether it will facilitate the resolution of business-to-consumer (B2C) disputes and thereby create a conducive setting to further development of e-commerce.

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Shall or Should?

The Attitude Towards Soft Law in International and European Law Katerina Yordanova BLC Alumnus Sofia Centre

I. Introduction The term ‘soft law’ is one of the first things a law student is taught, together with the terms ‘legal order’, ‘legal act’, etc. Ultimately, if asked what soft law is, most law students and legal professionals will answer something along the lines of ‘rules of conduct which are not binding’. By giving such a response, they will be right in principle. But what should be kept in mind is the absence of a universal definition of soft law and thus its scope cannot be deemed completely clear.

Furthermore, soft law is a term used predominantly in relation to international law where it constitutes a useful instrument for the facilitation of rough agreement between states, albeit not

OBITER

DICTA

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legally binding. Even though European law has been defined as ‘a new legal order of international law,’1 it continues to be part of international law and it still deals with sovereign states that quite often see the usage of soft law as a guarantee against interference in their internal affairs. That explains the widespread usage of recommendations, opinions, communications, etc. in the European legal

framework. In-depth analysis of those soft law instruments, however, proves that their initial nonbinding character has altered and that the European Union acts as a ‘hardening agent’.

The aim of this paper is to offer a number of characteristics that can be used to identify a given rule as ‘soft law’ working from the basis of the numerous existing academic definitions of soft law. Then the general definition so established will be employed to compare and contrast soft law in the context of International law and European law in order to identify the differences that arise in European soft law instruments.

II. The Concept of Soft Law 84

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Most publicists that write in the area of International or European law provide their own definition of soft law. Malcolm Shaw considers soft law to be ‘non-binding instruments or documents, or nonbinding provisions in treaties.’ Some other authors in the field of International law go even further and describe soft law as not law per se, but rather as documents, which may go by different names, but which can be grouped under the category of soft law. These definitions, however, are not very helpful because they describe just one aspect of the term, namely its non-binding nature. Peter Malanczuk recognizes that the existing definitions are not helpful from a legal perspective and adds that soft law ‘operates in the grey zone between law and politics’ and that it is considered ‘a special characteristic of international economic law and of international environmental law’. Soft law appears to be seen as some kind of vehicle that allows rules to be field-tested before becoming binding through incorporation into legally binding instruments or international customary law. These characteristics also facilitate consensus between states in sensitive areas such as economic relations and environmental law.

As already mentioned, European law is part of International law, but the extremely wide range of

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cooperation between the Member States raises concern regarding their sovereignty. Thus, a great variety of soft law instruments exist under the umbrella of European law. The importance of soft law for European law can be recognised by the immense number of works devoted to this topic by publicists who write about European law and in which the legal effects of the term soft law are closely scrutinised. Soft law is defined as ‘rules of conduct which, in principle, have no legally binding force but which nevertheless may have practical effects’. It has

also

characterized

been as

‘commitments which are more

than

policy

statements but less than law in its strict sense.

They all have in common, without being binding as a matter of law, a certain

proximity to the law or a certain legal relevance.’ Unlike International law publicists, their colleagues writing in the area of European law speak predominantly of soft law as consisting of rules of conduct, not documents, the latter being considered merely a form that contains the law. The non-binding nature of soft law is seen both in the lack of enforcement and the lack of sanction. It is also observed that soft law ‘does not show a uniform value of intensity with regard to its legal scope, but the different soft law rules do have in common that they are directed at (intention of the drafters) and have as effect (through the medium of the Community legal order) that they influence the conduct of Member States’. These observations could be used to draw the conclusion that one of the most distinctive differences between soft and hard law is legal effect regarded as the attribution of legally binding force. Linda Senden’s definition of soft law probably includes the broadest scope of the abovediscussed properties of soft law. In her view, soft law comprises ‘rules of conduct that are laid down in instruments which have not been attributed legally binding force as such, but nevertheless may have certain (indirect) legal effects, and that are aimed at and may produce practical effects.’

Of course there can hardly be an objectively correct choice of definition when the term is not defined

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legally, but the wide variety of opinions are helpful in delineating the common characteristics of soft law that would help identify such provisions when encountered and get a grasp of what soft law is.

What is more, the definitions put forth may assist in identifying those rules that are claimed to be soft law, but which lack some of the frequently mentioned defining traits.

First, soft law could consist in rules of conduct or could refer to instruments containing such rules.

Second, soft law has no legally binding force, but has practical effect. Third, it does not create rights and obligations. Fourth, soft law could neither be enforced nor have sanctions in the event of infringement.

Soft law rules can be basically categorized into two groups. The first one includes soft law that provides information about already existing binding rules, i.e. they act as a form of interpretative source. The second group covers soft law that creates expectations about future conduct.

III. Soft Law and International Law After this brief clarification of the nature of soft law, it is necessary to see its practical implications in the field of Public International Law and determine if soft law is still ‘soft’ and whether it still has all the necessary requisites to be recognised as such.

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When thinking about soft law in the light of international law, the first thing that comes to the learned reader’s mind is probably the non-binding resolutions of the General Assembly of the United Nations.

Chapter IV of the UN Charter establishes the powers of this organ. It is noticeable in the very text of the articles that the main functions assigned to the General Assembly are to discuss and make recommendations which are not binding.10 M. Shaw describes them as ‘generally not legally binding and merely recommendatory, putting forward opinions on various issues with varying degrees of majority support’.11 At the same time, the International Court of Justice admits that ‘General Assembly resolutions, even if they are not binding, may sometimes have normative value.’12 A reasonable question to ask is whether this impacts the soft law character of this type of legal instrument. The answer is negative. In the Nicaragua case13 the ICJ states that ‘opinio juris may, though with all due caution, be deduced from, inter alia, the attitude of the Parties [i.e. the US and Nicaragua] and the attitude of States towards certain General Assembly resolutions.’ In the Legality of Nuclear Weapons advisory opinion, the court also examines a number of General Assembly resolutions and finds that several of them have been adopted with a significant number of negative votes and

The Bar Standards Board (BSB – England & Wales’ barrister professional regulator) has quietly reminded new barristers that they must use the correct “grammar, spelling and punctuation”.

In an updated version of the BSB’s “Professional Statement for Barristers” released on September 21st, the regulator reminds the newly qualified that they must “use correct and appropriate vocabulary” in all of their communications. As well as being able to “speak fluent English”, the revised statement — which describes the knowledge, skills and attributes that all barristers should have on “day one” of practice — states that new barristers must be able to “analyse written information.”

This comes hot on the heals of another scoop this month, where a former barrister, now a High Court judge, added some emojis into his family law judgment! Not only that, but last year, the Bar Council weighed in to the life-coaching business to remind young barristers to “have at least two or three alcohol-free days each week” and lose some weight “if necessary.”

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abstentions. The Court concludes that because of this, these resolutions fail to establish the existence of opinion juris on the topics addressed in the resolutions. As far as state practice is concerned, if a majority of states vote consistently for declarations or resolutions on a certain topic, it could be considered as state practice and if opinio juris exists, a binding rule may arise from those non-binding acts. Such was the case with the 1960 Declaration on the Granting of Independence to Colonial Countries and Peoples and the Declaration on the Legal Principles Governing Activities of States in the Exploration and Use of Outer Space from 1963. All of this goes to prove not a shift in the non-binding

nature of the resolutions of the General Assembly, but the possibility of them being used as a means to prove the existence of the two different components of customary international law, which itself is not soft law. Thus, it could be concluded that the resolution itself does not have normative value or establish any rights and obligations. It could merely play a role in the establishment of a binding legal rule of customary law or otherwise help to show that such a rule already exists.

It could not be any other way since these resolutions are the result of exceptionally wide political

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consensus. M. Shaw goes even further, saying they are ‘comprehended in that sense, never intended to constitute binding norms.’

This political consensus, which is sometimes very hard to achieve, is often the main reason for the adoption of soft law in areas where legally binding arrangements are not agreeable for the present moment. As previously mentioned, environmental law is such an area, with the tendency starting to shift towards adoption of legally binding treaties only recently. An illuminating example in that regard is the so-called Forest Declaration adopted at the 1992 Rio Conference on Environment and

Development. The full name of the document is ‘A Non-legally binding Authoritative Statement of Principles for a Global Consensus on the Management, Conservation and Sustainable Development of all Types of Forests’. The title itself evinces the intent of the parties not to be bound by the document.

One cannot help but ask oneself why would there be a need of such a document at all if the parties do not consider themselves bound by its provisions. It is our opinion that soft law should be regarded as a stage, a necessary step towards the establishment of a legal rule. Accomplishing a political consensus and getting a group of sovereign states to agree on having legal obligations where they had none before, is a delicate process and it often takes a lot of time. A soft law instrument could be transformed into a treaty later on, help customary law to be established or serve as a starting point for new negotiations in a certain area which could lead to broader consensus or even raise awareness of a certain issue. Examples of such cases are, inter alia, the Universal Declaration of Human Rights and the decisions of the UN Human Rights Committee which are soft law but which nevertheless possess an important place in the field of human rights law.

The abovementioned aims to demonstrate that the effect which soft law has in Public International

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Law is not due to changes in its nature but due to other processes and through other hard law instruments. There is one case, however, in which soft law has binding effect, but this exception does not indicate alternation to the existing concept of soft law for reasons that are to follow.

The

International

Telecommunication Union (ITU) is a UN

specialized

agency

concerned with the maintenance extension

and of

co-

operation with regard to

the

use

of

telecommunications on the international plane as well as the promotion of the development of facilities and the efficiency of services. According to article 6 (1) of its Constitution, Member States are bound only by the provisions of the Constitution, the Convention and the Administrative Regulations and only as long as those provisions engage international services or are capable of causing harmful interference to radio services of other countries. The ITU adopts instruments in different sectors such as the Telecommunication Standardization sector or the Telecommunication Development sector. These sectors adopt recommendations, resolutions, decisions, and reports, all of which are non-binding but based on thorough studies on the technical aspects that need standardization and regulation. The essential point here is that even though states

do not have any legal obligation to comply with those instruments, they do comply, albeit not due to the presence of sanctions or mechanisms of legal enforcement. The reason is that the whole international telecommunications system that is enshrined in the ITU ‘essentially depends upon states recognizing the effects of failure […] to behave in a responsible manner’ This effect is described by Jens Hinricher as being ‘lethal’ to many of the governments.19 This can easily be explained by the fact that they concern recommendations adopted not by politicians but by the

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leading experts in the telecommunications field. Not following them leads to a lack of standardization.

The lack of standardization means that the users of telecommunications and radio services would not be able to use them at an international level or at least not universally. A clear example in this regard is the E.164 recommendation of the ITU on the international public numbering plan. By means of this recommendation, the ITU establishes that plan-conforming numbers shall be limited to a maximum of 15 digits and also how a number is formed. Simply put, in the event of the lack of compliance by all states and telecom operators with these recommendations, it would be virtually impossible to dial a phone number, let alone communicate with subscribers of telecom operators in other countries. In our opinion, soft law adopted by the ITU is one of the major factors that allow us to live in a globalized world. Thus, it is understandable that the nature of the ITU’s soft law is not altered by mere fact that states comply out of ‘the simple necessity to comply’.

IV. Soft Law and European Law As has already been noted, soft law, adopted in the context of Public International Law, keeps its ‘softness’ insofar as it lacks legally binding force but nevertheless possesses some degree of practical effect. It does not seem to create any rights or obligations and has no way of being enforced. Should European law be considered part of International law, soft law should manifest the same characteristics. Looking at the Treaties prima facie this appears to be the case. Article 288 of the Treaty of the Functioning of the European Union clearly states that recommendations and opinions shall have no binding force. The European Court’s practice, however, develops this concept and adds some additional features to soft law instruments which they lack in International Law. In its judgement in the Grimaldi case, the European Court holds that recommendations issued by

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community institutions under Article 189 (5) of the Treaty of the European Union ‘serve as a guideline in interpreting national law that is supposed to implement that recommendation’. In Dansk Rørindustri and Others v Commission the court goes even further. It admits that non-binding texts can produce legal effects if they meet certain conditions, namely being in conformity with primary and secondary EU law, and being consistent with established jurisprudence. The court adds that such legal effect

could be recognized only to the extent that it ‘serves the promotion of the protection of legitimate expectation and the principles of equal treatment and legal certainty’. The definition of such conditions, however, does not change the fact that the European Court recognizes that soft law instruments could have legal effect in certain cases which amounts to what could be called a deviation from international law where they have no legal effect at all.

Soft law in the European Union is adopted predominantly by the various agencies that function within the Union’s scope of operations and by the Commission itself. The establishment of such agencies and subsequently the delegation of regulatory competences to them is not regulated, at least not explicitly

in the European Treaties. As a result, agencies are established most of the time by ‘secondary law acts on the basis of a specific Treaty provision, such as Articles 114 and 352 TFEU.’ Powers may be delegated to such agencies but it must be confined to ‘clearly defined executive powers and does not extend to powers involving a wide margin of discretion.’ Thus, general regulatory power cannot be delegated to such bodies. Nevertheless, this adoption of soft law allows circumvention of the competent legislative bodies and avoidance of the proper procedure related to the decision-making

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process in the Union, especially considering that there are usually no specific requirements about the procedure for adoption of soft law instruments. Moreover, the soft rule-making power that the agencies have been granted does not seem to fall under the restriction of Meroni case. Some authors even consider that this helps soft law ‘obtain an important authoritative function in legal practice’ and that the European Court’s case law shows that it ‘is definitely not devoid of legal effects.’

One example of the agencies mentioned above is the European Securities and Markets Authority (ESMA). Its objective is to ‘protect the public interest by contributing to the short, medium and longterm stability and effectiveness of the financial system, for the Union economy, its citizens and

businesses’. The ESMA adopts guidelines and recommendations, currently around 27, the body has not established any differences between the two types of soft law and there is no reason to believe there is a difference with respect to their binding force. Article 16 (1) of the ESMA Regulation prescribes that the Authority addresses its recommendations and guidelines to ‘competent authorities or financial market participants.’ ESMA Guidelines under Regulation (EU) 236/201230 include a provision saying that, ‘Competent authorities to whom the guidelines apply should comply by incorporating them into

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their supervisory practices, including where particular guidelines are directed primarily at financial market participants’. Although it is clear that soft law is not binding, the wording of these guidelines and recommendations point in another direction. All of these soft law instruments have a similar structure and likewise make use of similar terminology. They usually start by referring to Article 16 in a manner that the document in question contains guidelines and recommendations issued under Article 16 of the ESMA Regulation and then continue by saying that, ‘in accordance with Article 16 (3) of the ESMA Regulation, competent authorities and financial market participants must make every effort to comply with guidelines and recommendations.’ The choice of words is rather peculiar considering that the said article 16 (3) provides that the ‘competent authorities and financial market participants shall make every effort to comply with the guidelines and recommendations.’ Why is this important? The European Court on numerous occasions stated that ‘not the chosen form of the act determines its legal nature, but rather the intention of the authors as this can be derived in particular from the actual contents of the act’.31 The verb ‘must’ is not used for making recommendations but for establishing obligations. In the words of Linda Senden, if the words used in a soft law instrument are of an obligatory nature, ‘‘it will be difficult to maintain that the act does not intend to impose any obligations.”32 Having that in mind, Article 16 (3) of the ESMA Regulation prescribes that all

competent authorities, which are addressees of the guidelines and recommendations, must notify the Authority within two months after the publication of the soft law instruments, and state their intention to comply with them. If the authorities do not notify the ESMA during the term they will be considered as non-complying. At the same time the authorities still have the obligation to notify the ESMA if they will not comply and provide a sufficient explanation justifying their decision. These data are kept by the ESMA and published, sometimes together with the reasoning offered. On the basis of these notifications, the ESMA presents the so called ‘guidelines compliance tables’ in which the state which has chosen not to comply are marked in red. This particular method of formatting implies that the noncomplying states have breached some kind of obligation which they simply cannot have because of the soft law nature of the instruments. M. van Rijsbergen defines this practice quite fittingly as a ‘naming and shaming mechanism for enforcement.’

The other type of addresses, namely financial market participants are also considered to be under an obligation to report in a ‘clear and detailed way’ whether they will comply with the soft law adopted by the ESMA.

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Another strange characteristic of the ESMA is the fact that its Board of Supervisors prepares an annual report that aims to inform the European Parliament, the Council, the Commission, the Court of Auditors and the European Economic and Social Committee about the recommendations and guidelines that have been published, providing information about the complying and non-complying actors as well as indicating the way the ESMA will ensure the competent national authorities’ future compliance with the guidelines and recommendations.

All that has been said regarding the ESMA and its ‘soft law’ rule-making leads to the conclusion that

the guidelines and recommendations establish some obligations. Even the very language of the documents aims to inform the addressees that they need to comply with the ‘soft law’. Even though there is no official mechanism that could help to enforce these rules, a number of details such as the red marking of the non-complying states and the requirement for notification and explanation of the reasons for non-compliance, serve as an inducement for behaviour in accordance with the guidelines/ recommendations.

The previous example indicates that soft law in the European Union’s legal order is hardening. This process is particularly obvious in the context of EU financial regulations. At the international level, there are plenty of informal bodies which adopt capital adequacy rules, accounting standards and a

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variety of other substantial and technical rules. These instruments can be considered as ‘informal transnational best practice’. What the EU does is function as a ‘hardening agent’, transforming thereby soft law into rules that are backed up by enforcement mechanisms provided by the domestic law of the Member States. Global financial regulation is built on the basis of informal regulatory networks.

These networks consist of both public and private actors. Organizations, such as the International Organization of Securities Commissions (IOSCO), the already mentioned Basel Committee on Banking Regulation,

the

Association

of

International Insurance

Supervisors (IAIS), the International Accounting Standards Board (IASB), and the International Derivatives and

Swaps

Association

(IDSA)

adopt and promote best practices and standards. These practices and standards are soft law in essence and the aforementioned bodies

rely

on

voluntary

compliance.

When and if the European Union decides to comply with a certain set of standards or practices, it changes their nature because it prioritizes the usage of that particular set of standards and therefore indirectly forces Member States and other international actors to do the same. For example, the Banking Directive and Capital Adequacy Directive of 200635 incorporate the Basel II specifications which are promulgated by the non-treaty-based Basel Committee and the Member States have no choice but to embody this piece of soft law. In other cases, the European Union just requires that Member States should adopt the necessary standards in order to achieve the tasks set by the directives. It turns out, however, that those specific areas are regulated by the standards adopted by the ISDA and that the most convenient path for the Member States is to adopt them in their national legislation or just declare that they will be applying them. Due to the European Union’s role on the financial markets, the other participants find themselves taking into consideration the standards adopted by the Union which influence their choice of soft law to apply.

While relying on soft law instruments adopted by informal bodies, discussed above, could be explained

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to some extent by the expert nature of the sources, it still leaves some kind of choice as to if and when to apply the soft law. On the other hand, there are cases in which ‘internal’ European soft law practically leaves Member States with no choice in term of compliance.

It is universally acknowledged that national law must be interpreted in the light of European law because of the latter’s supremacy. This obligation is not limited to the national courts but to every national body that interprets the law. The European Electronic Communications Framework Directive, in its Article 7 (5) prescribes that the national regulatory authorities ‘shall take the utmost account of

comments of other national regulatory authorities and the Commission.’ These comments are soft law in their essence and do not have obligatory character per se. Even if the very name of the instrument is disregarded, these comments are not subject to any judicial control and they are usually established in letters which the Commission sends to the competent national regulatory authorities. In our opinion, this practice violates the principle of legal certainty. Nevertheless, there are cases before national courts where national regulatory authorities’ acts are subject to repeal when an opinion or recommendation of the Commission has not been taken into consideration. While this may be seen as an extreme case and an exception, it is a common practice for national regulatory authorities to be obliged to give detailed reasons why they have deviated from certain of the Commission’s recommendations. A recent example is paragraphs 19, 20, 21 and 22 of the Recommendation on relevant markets susceptible to ex ante regulation (2014/710/EU). This instrument mainly concerns identification of electronic communications networks and electronic communications services markets through the application of a three-step test which aims to establish whether there is sufficient competition on the respective market and if not, whether regulation should be imposed on the respective market. Even though the cited paragraphs are part of the Recommendation’s recitals, they were used as a legal basis for the Polish regulatory authority to ask for annulment of the Commission’s decision ordering the said authority to withdraw two notified draft measures concerning the definition

of a new national wholesale market for IP traffic exchange due to lack of sufficient reasoning detailing why such a market would need to be regulated, having taken into account the markets established by the Commission in the Recommendation. Unfortunately, the court never ruled on the merits of the case because the in-house legal counsel representing the Polish regulatory authority did not fulfil the necessary independence criteria in order to represent the body before the Court, as he was not a third party. Nevertheless, it is clear that the Commission adopted its decision, such a measure being legally

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binding according to article 288 TFEU, on the basis of a suspected breach of the obligation to provide sufficient reasoning when not following the Recommendation. This goes against the very nature of soft law that does not establish any rights or obligations by definition.

Similar examples involving interactions between European agencies or the Commission, on the one side, and national bodies, on the other, are quite typical of sectors that are highly regulated due to their social significance and the presence of incumbents with a dominant position enjoying special or exclusive rights granted by the state in past times prior to liberalisation of the respective markets. In

some cases, the new ‘harder’ soft law is used to circumvent proper legislative processes, in other cases it is used in a more traditional sense, i.e. in the pursuit of political consensus that can eventually lead to some obligations being imposed. An example in this regard is the soft law instruments adopted in the context of the Common Security and Defence Policy. Having said this, soft law rules are still officially considered as non-obligatory in most cases. Why ‘in most cases’? The answer lies in the fact that European soft law is obligatory for the body which adopts it. For instance, the Commission Notice on agreements of minor importance which do not appreciably restrict competition under Article 101(1) of the Treaty on the Functioning of the European Union or the so-called ‘De Minimis Notice’ practically limits the Commission’s own powers by determining in which cases it will act and in which it will not.

This self-restraining effect is also recognized in the case of the European Commission’s Twelfth Report on Competition Policy.43 The extensive jurisprudence further confirms that this is a common feature and that every soft law rule establishes obligations for the body that adopted it.

V. Conclusion In the opening section of this paper, a variety of definitions provided by notable publicists in the area of International and European law were presented in order to identify a list of characteristics that are indispensable for a given rule to be considered soft law. Having established a common and clearer ground on the issue of the perception of the term, we examined the manner of its utilisation and the changes and transformations it goes through in the field of both Public International Law and European law. The results of the present research could be considered indicative of a preliminary conclusion that soft law manages to keep its basic characteristics so far as Public International law is concerned, and does not manifest in any legally binding effect on its subjects. There are no effective means of its enforcement nor any established sanctions. It remains merely a means for reaching

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political consensus and could help in the creation or the proving of the existence of customary international law. Those soft law rules that are followed voluntary due to the practical necessity to comply with them, such as the recommendations of the ITU, are not an exception but evidence for the practical effect of some soft law regimes.

In the context of European law, a well-defined evolution is noticeable in relation to soft law rules. Soft law is often used as an alternative route, circumventing the traditional legislative process. It is declared to be capable of producing legal effects by the European Court and as legally binding for the body that adopts it. At the same time the Commission and European agencies apply mechanisms that practically

ensure the Member States’ compliance with soft law rules and use language that raises doubt whether certain soft law was created with the intention of being soft. In conclusion, the present research unveils the changes that the traditional understanding of soft law has undergone and leaves us wondering whether this evolution will stop, remain confined to the field of European law, or expand to Public International law as well.

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Societas Unius Personae Matej Sarapatka BLC 2nd Year Student, Prague Centre

In June 2008 the effort to improve the business environment for small and medium-sized companies (hereinafter "SMEs") and to support competitiveness and the cross-border dimension of business1 led

the European Commission to present a proposal for a Council Regulation on the Statute for a European Private Company, or Societas Privata Europaea (hereinafter "SPE" ). This ambitious project, however, struggled with the negative attitude of Germany and the inability of member states to agree upon a compromise. Given the very low probability of unanimity in the Council, the proposal for the regulation was revoked by the Commission4. Nevertheless, the Commission already conceded that this might be the regulation’s fate in its Action Plan for 20125 and envisaged alternative means of achieving the abovementioned objectives. Thus in April 2014, the Commission returned to the idea of a single-member company already contained in the Twelfth Council Company Law Directive of 21 December 1989 on single-member private limited-liability companies and adopted the Proposal for a

Directive of the European Parliament and the Council on single-member private limited liability companies.

So far, the Proposal has already been amended by 7 compromise proposals of different member state presidencies and is still at a stage where its final form is not clear. For the purposes of the current debate in the European Parliament and also for the purpose of this article the modified version of the

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general approach of the Competitiveness Council (COMPET) of 29 May 20158 will be used (hereinafter "Proposal"). The Proposal for a Directive on single-member private limited liability companies, or Societas Unius Personae (hereinafter "SUP") underwent an important change in its form as compared with the Regulation of the SPE Statute, its predecessor. It is no longer a regulation on the basis of Article 352 TFEU, and the form has been changed into a directive based on Article 50 (2) (f) TFEU.

Therefore, the unanimous consent of all members of the Council to the measure’s eventual adoption will not be required. The Commission in a Memorandum of 9 April 20149 even anticipates that the SUP Directive should replace the Directive of 2009 on single-member private limited-liability companies.

This raises the question whether it will truly be a new form of European supra-national company as in the case of the SPE, or whether it will be a mere extension of the efforts of the Twelfth Directive on the harmonization of national companies, whereby a single-member limited liability company upon fulfilment of the criteria contained in the Directive shall be designated an SUP. One thing is certain.

The range of the regulation on the SUP is indisputably less ambitious than that on the SPE. It is austere and adheres to the principle of proportionality almost timidly. The proposal in its current form aims to achieve specific rudimentary goals rather than an all-encompassing solution to problems concerning the functioning of SMEs. The Proposal leaves all contentious issues to the individual laws of the Member States. On the other hand, this achieves far greater political acceptability and hence chances of approval. In my opinion, given the vagueness and concessions in the current Proposal, its approval should be considered as Pyrrhic victory.

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The content of the Proposal of the SUP Directive Article 7 (3) of the Proposal introduces a new designation for single member companies - SUP. The intention is to introduce a uniform identity for these companies so as to avoid distrust of companies established under foreign laws. The common abbreviation is to be perceived as a European seal of quality and a "passport" for the incorporation and functioning of SUPs in EU Member States. The original version of the Proposal envisaged the possibility of placing additional state abbreviations, but

this option was later cancelled in favour of a general obligation upon companies to indicate the address of the registered office in letters and order forms (invoices) in accordance with Article 5 of the Directive 2009/101/EC14. Due to the poverty of the content of the proposal for a Directive, many15 expressed the view that for the purposes of harmonization it would be much more convenient to omit the necessity to indicate the SUP abbreviation next to the company´s name and retain instead the existing names for the individual equivalents of SUPs in each member state.

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One of the main objectives of the Commission in its Proposal was to facilitate cross-border activity of SMEs and reduce the costs and administrative burdens associated with the establishment of subsidiaries in other EU countries. To achieve these objectives, the Commission envisaged the introduction of an online system for registration of companies, model forms for registration and uniform templates for articles of association and also the abolition of compulsory share capital. After pressing criticism from the Member States, the model forms and a uniform template for the articles of association were removed from the above mentioned tools provided that the Member States should make adequate efforts to translate relevant national documents into all European languages.

Although online registration is not unknown among the Member States, it is the first attempt from the EU to implement such a provision on Directive level. Article 11 (3) of the Proposal contains a list of information that Member States may require from the applicants for incorporation. In addition, the Member States may extend the scope of the information requested for the purposes of combating money laundering and needs connected to fiscal, social and other related issues19. The identity verification is being left to the discretion of the Member States with the Proposal recommending the introduction of measures such as video-conferencing. State administrative cooperation in matters of online registration and verification of identity will then be governed by Regulation 1024/2012 on IMI system. For companies founded ex nihilo (i.e. not in the case of transformations) the Proposal provides for a five-day deadline for their incorporation starting from the receipt of all required documents and information. In exceptional cases, the deadline may be extended.

In the original proposal for the SUP Directive, the Commission envisaged the possibility to locate the registered seat in a Member State other than the principal place of business. Unfortunately, this

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regulation met with strong criticism from the Member States. The main argument against such a possibility has been the circumvention of the national rules governing the participation of employees in company management. All references to the registered seat were removed from the current version of the Proposal, this now being left to the discretion of the state of incorporation. The resistance of Member States is, however, quite incomprehensible in a situation where the legislation of the bulk of members already allows companies to have their principal place of business outside their state of origin.

Despite the numerous protests of Member States against low creditor protection, the registered capital of SUP was fixed at the amount of EUR 1 or any other unit of currency of non-EMU24 States.

The Proposal allows the SUP to form reserve funds including mandatory ones, for example in cases in which the company participates in business within the regulated sectors. The regulation of dividend payment and prevention of insolvency caused by it is reserved to national legislation, which can request the submission of balance sheets or the passing of solvency tests, or both.2 The original Commission proposal introduced an interesting form for the SUP´s internal organization and if maintained, it could have constituted a significant facilitation for SMEs in relation to setting up subsidiaries in other Member States.28 The inability of the Member States to reach an agreement on the form of the regulation of appointment and removal of directors and the right to give instructions

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to executives and company management within the business group further degrades the SUP´s potential as a medium

for

the

cross-border business activities of SMEs. Conclusion After

the

great

expectations which were caused by the ambitious adaptation of the SPE Regulation and the original text of the Proposal for a Directive of the European Parliament and the Council on singlemember private limited liability companies, it is impossible to avoid a sense of disappointment. The current Proposal provides an extreme example of a "race to the bottom", where none of the issues are addressed directly, but are delegated to the laws of the Member States to such an extent that the SUPs of each Member State will inevitably differ widely. If the situation is such that Member States are not able to reach consensus, the question arises whether it would not be better to focus on developing

more general legislation such as the Twelfth Directive rather than on the creation of new forms of companies, when the political winds are simply not in their favour. Apart from the negative features which have been discussed here, it is necessary to also highlight the fact that the Proposal introduces a new option for online registration and places pressure on states to translate their national laws and make these available to those from other Member States who are interested in the incorporation of companies.

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CEEMC 2016 TRAVELS TO BRATISLAVA Denise Ashmore BLC Course Director

Central and East European Moot Court

The 22nd Central and Eastern European Moot court competition saw the competition return to the lovely city of Bratislava, to be co-organised by the Comenius University and hosted by

the Supreme Court of Slovak Republic.

This year’s moot problem focussed on the

EU’s

expanding

legislative

influence on consumer issues and the manner in which consumer protection rules apply in cross-border situations within the Union’s area of justice, freedom and security with questions on the choice of law arising out of the EU’s “Rome Regulations” and a dispute regarding cross-border insurance of

motor car drivers with the complication that when calculating the costs of insurance for men and women drivers different rules were applied according to the location of the insurance company and consumer who were respectively in a EFTA State and an EU Member State.

In light of the pending Brexit referendum vote, teams were also required to compare the respective membership benefits

of the EU and European Free Trade Association and their interrelationship and role of their respective institutions and courts.

As always the competition was characterised by the enthusiasm and intenseness of the teams, the efficiency of the local organisers, the commitment, professionalism and dedication of the judges and the spirit of 108

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gaiety and warmth and fellowship at all of the social events.

The judging panel was again led by the British Advocate General Sharpston, who also took her leading

Central and East European Moot Court

role

in

the

singing

competition with Lady Odile Slynn

in

the

traditional

French drinking song. She was

joined

by

Czech

Advocate General Michal Bobek and Judge Jan Passer of

the

Czech

Supreme

Administrative Court with colleagues from the Court of Justice and the EFTA Surveillance Authority. Professors Richard Fentiman and Rosa Greaves headed the academic contingent.

The

team

from

Charles University made up of Lucia Skapova

Ondrej

Dolensky

and

Katerina Novotova took

the

final

honours in a tense final

with

Speaker for

Best

awards Tsvetelina

Baraitakova (St Kliment Ohridski University) and Liliya Makhynko (Kyiv Moyla Law Academy) and the Clifford Chance prize for Best Written Pleadings going to our hosts in 2015 the Free University of Tbilisi.

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As always the singing competition was a highlight of the final party, with all joining in the final chorus of the judges song this year which detailed the stages of the moot question concluding with the words:[Last verse – all together] Let’s ask AG Sharpston – she’ll know what to do And when she gives her judgment it will not be good for you Your submissions are useless – your arguments fall short You’ll be crying all the way back to the national court

CEEMC – good for you and me-ee-ee We’re gonna learn to moot, have a hoot too-oo-oo Let’s grab our beers, and all say cheers See you next year – CEEMC-ee-ee See you next year CEEMC ceee!

Our winners will have the opportunity to either visit the Court in Luxembourg or the University of Cambridge and UK Supreme court and to participate in some of the activities experienced by their colleagues from 2015, who shared some of their experiences with us.

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CEEMC 2015 WINNING TEAM’S VISIT IN UK In the first week of October we had the pleasure not only to visit London and Cambridge, but also to be generously hosted by some of the UK’s foremost legal institutions.

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Upon our arrival, we were warmly received at the Honourable Society of the Inner Temple prior to moving swiftly on to the Royal Courts of Justice where we were given a truly informative overview of the Courts’ history. Later in the day we were honored to be hosted at the UK Supreme Court by Lord Carnwath JSC, who gave us insight into the functioning of this world reknown court. After tea with Lord Carnwath, we toured the magnificent Westminster Abbey, Big Ben and Westminster Palace. In the evening, we departed for Cambridge where we were generously hosted by Emmanuel College.

After beginning our first day in Cambridge with a traditional English breakfast, we toured The Squire Law Library—an impressive modern building designed by Norman Foster and holding one of the world’s largest collections of legal literature. We spent the remainder of the day exploring the beautiful buildings and courtyards of Cambridge.

The next morning we attended some stimulating lectures at the Cambridge Law Faculty and were amazed by how greatly these differed from any we had previously attended.

Our Cambridge experience would have been incomplete without some punting on the River Cam. We rather overestimated our talents and opted to go without a professional punter. After continuously bumping from one side of the river to the other, we acknowledged our mistake. Despite a rather jarring ride, we will never forget this remarkable experience.

Our final day in Cambridge concluded with an extraordinary dinner hosted by Professor Cornish and his gracious wife. They warmly welcomed us into their home, a kindness for which we were very grateful.

Irma Abdić , Zoran Škrbin , Luka Milanović , Maks Mencin

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Best Speaker 2016 Report When I first applied for the CEEMC team of Sofia Univesity “St. Kliment Ohridsky”, I

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did not know much about the competition nor the work it would entail, so it was, in a way, a shot in the dark. I could not imagine that I would have such incredible coaches and teammates, that I would learn so much about EU law and presentation skills and that the few days of the competition would be so challenging and exciting. I did not expect that I would visit such an extraordinary place as Tbilisi, Georgia, let alone that I would be awarded a Best Speaker Prize and a one-week visit to the Court of Justice of the European Union.

The trip to Luxembourg was for me a dream come true as I had always been interested in EU law. I discovered that Luxembourg has a lot to offer visitors.

The world’s last remaining grand duchy, the country has three official languages: Luxembourgish, French and German. With breathtaking vistas over narrow river valleys and a magificent castle, Luxembourg City itself is charming.

On Monday, my fellow Best Speaker prize-winner, Mariam Moseshvili of Georgia, and I presented ourselves at the entrance of the Court and I met Ms. Isabella Wimmer, secretary to AG Sharpston. Ms Wimmer took care of me throughout my visit and was immensely helpful. That first morning she showed me around the Court. Just across the street, I could see the beautiful concert hall of the Luxembourg Philharmonic. The Court itself was really impressive. I was particularly fascinated to see a cast of Auguste Rodin’s bronze sculpture ‘The Thinker’ in one of the corridors.

Ms Wimmer then led me to AG Sharpston’s Cabinet where I met her four 112

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referendaires – Mr Alan Baillie, Mr Stanislas Adam, Ms Margaret Doyin and Ms Isabelle Van Damme. The first day I spent getting acquainted with a case that Mr Stanislas Adam was currently working on that concerned state aid. I read the preliminary report and the observations of the parties which proved to be particularly

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useful as the next morning I attended the hearing for the case in the Grand Chamber. I was surprised to see how close the CEEMC competition was to a real hearing.

The next few days I spent doing more in-depth research on another case which concerned two EU Directives on greenhouse gas emission allowance trading. I was also encouraged to present my observations on the case. Although it took me much reading and effort to understand the questions, the issues turned out to be extremely interesting. During my visit the celebrations for the 1000th anniversary of the signing of the Magna Carta were taking place. I was lucky enough to see the original document which was in the Court at that time. I was very grateful to attend AG Sharpston’s weekly meeting with her team on Wednesday during which they discussed the progress on different cases and how it would be best to organize their work.

On the last day of my visit, I had the honor of meeting AG Sharpston for an engaging conversation, during which she told me more about her work and answered any questions I had. Once again, I was impressed by her professional attitude towards her work. All in all, my short stay in Luxembourg was extremely motivating and I left full of enthusiasm to do great work. Participating in the CEEMC turned out to be one of the best decisions I have ever made. I recommend the competition to all law students as it is a very rewarding experience! And I want to express my gratitude to my university, my coaches and my team, to AG Sharpston’s Cabinet for welcoming me, and of course to everyone who participated in the organization of CEEMC for making this adventure possible.

Bilyana Manova

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1. British Constitutional Norms and the Primacy of EU Law after the HS2 Judgment 2. The Polish Constitutional Tribunal Crisis 3. The Butterfly Effect 4. Article 50 TEU and BREXIT 5. Interview with Iain Morley QC 6. The new Polish law on spatial planning 7. The Hillsborough Disaster and its impact on English law 8. Termination of employment contracts in Poland 9. The Duomatic Principle 10. The Academy of Good Law 11. The safety implications of the rise of the drones 12. Software piracy 13. A comparison of the Polish and the English Consumer Rights Acts 14. E-commerce and the introduction of the EU Regulation on consumer ODR 15. The Attitude Towards Soft Law in International and European Law 16. The Societas Unius Personae 114

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