Brexit and the environment

Much of our environmental legislation is based on EU directives and case law, so what might Brexit mean for rules safeguarding the environment? Simon Colvin explains.

We all knew the referendum was coming, but what we did not know was when. That question has now been answered: 23 June 2016.

Now that the majority of politicians have decided whether they want to support the In or the Out campaign, businesses are starting to ask themselves what an exit from the European Union would mean for them.

In the utilities sector one of the key impacts of an Out vote would be in relation to the environmental controls that operators are subject to. Many EU environmental controls have come in the form of European directives, which have then required implementing legislation in the UK. There are, however, a number of direct EU controls in the form of regulations, such as the Transfrontier Shipment of Waste Regulations. These have direct effect and do not require any implementation at a member state level.

Alongside the legislative controls, there is case law that originates in the European Court of Justice. This court has been particularly active in interpreting the many and complex EU environmental laws.

In addition to the legislative controls and the case law, we also have European-based policy in relation to environmental protection, such as the Seventh Environmental Action Protocol, which determines the focus of EU environmental controls from 2014-20.

So what happens if on 23 June the UK votes to leave the EU?

If the decision is to leave the EU, there will be a managed exit. The European Treaty provides for a two-year negotiation period, meaning it is not something that would happen overnight. Post-exit, there would be period of renegotiation in which the post-Brexit model was implemented. Many commentators think this could take ten years to finalise depending on the model chosen. That is, a Norwegian-style European free trade agreement, or the Swiss approach of multiple bilateral agreements.

During this post-Brexit hiatus, it is unlikely the government would introduce any wholesale changes to environmental controls in the UK. It is, however, likely the government would have to move to plug any regulatory gaps left as a result of Brexit, such as the sudden absence of directly applicable controls, or where a UK Act or regulation contained “referential” drafting (that is, completed by reference to the relevant EU controls as opposed to specifically addressing the issue), or where you have EU-wide schemes such as the EU Emissions Trading System.

Only once the long-term future was certain, and the post-Brexit model agreed and being implemented, could the government consider how it might wish to remodel the package of UK environmental controls. According the post-Brexit timeline, that could take ten years or more.

It is widely understood that the Department for Environment, Food and Rural Affairs (Defra) has already looked at what environmental regulation might look like after Brexit, but Defra is not prepared to share the details of its study. It is known that the department has gone as far as considering what a complete rewrite of environmental controls might look like: a single Environment Act, much like the Health and Safety at Work Act 1974. That sounds quite radical, but in a post-Brexit world might not be that far-fetched.

Any decisions of the European Court of Justice would no longer be binding. They would no doubt still be influential in terms of the UK courts’ interpretation of environmental controls, but inevitably the UK courts might be asked to reconsider points that had already been decided by the European court.

The UK government would also need to step into the policy vacuum it has created over recent months in the environmental arena by setting out its detailed plans for the protection of the environment, something to date it has been reluctant to do.

There might be the added complication of Scotland then requiring a further referendum of its own in relation to independence from the UK. If Scotland voted to leave the UK, it might re-join the EU, meaning further fragmentation of environmental controls north and south of the border.

At present, the UK strongly influences the form and content of EU environmental controls. Once outside the EU we would lose that ability, but through the adopted post-Brexit model might have to continue complying with a number of EU environmental controls.

It is clear that the environmental arena is one area where the UK could be significantly worse off if it decides to the leave the EU. That is because of the short to medium-term uncertainty as to what environmental controls would apply during the interim hiatus, but also because of the complete lack of long-term clarity as to what the post-Brexit model would mean for environmental controls in the UK. Keep that in mind when voting on 23 June.

Simon Colvin, partner, Weightmans