UK courts' new EU case law departure powers due to enter into force later in 2024

A statutory instrument that will bring into force new powers for the Court of Appeal and Supreme Court set out in the Retained EU Law (Revocation and Reform) Act 2023 made it through Parliament's wash-up period ahead of the UK general election.

The powers will come into force on 1 October 2024, subject to certain saving provisions set out in the statutory instrument. The Civil Procedure Rules will also be updated to include a new part dealing with proceedings under these new provisions. Although the case law departure powers of the courts will be broadened, it remains to be seen how readily these powers might be exercised.

What are the new powers?

The Retained EU Law Act sets out a new test for departure by the Court of Appeal and Supreme Court from assimilated case law. The Act stipulates that the Court of Appeal and the Supreme Court will not be bound by any assimilated EU case law (that is, EU case law that was retained post-Brexit and was renamed by the Act at the start of 2024), except where domestic case law has modified or applied the assimilated EU case law and that domestic case law is binding on the court.

If the Court of Appeal or Supreme Court wishes to depart from assimilated EU case law, it must, among other things, consider the extent to which the assimilated EU case law restricts the proper development of domestic law. This potentially gives the courts broad authority to depart from assimilated EU case law.

However, the Act goes further by broadening the Court of Appeal's and Supreme Court's authority to depart from domestic case law that has been influenced by assimilated EU case law (known as assimilated domestic case law) where it considers it right to do so.

Although this test is the same test used by the Supreme Court when it is deciding whether to depart from its own precedent, the courts would expressly have to consider, among other things, the extent to which this assimilated domestic case law was influenced by assimilated EU case law, and the extent to which the assimilated domestic case law restricts the proper development of domestic law. This potentially gives the courts a wide scope to depart from decades of established UK case law that has been influenced by assimilated EU law, which could potentially prompt re-litigation of established principles.

Although the Court of Appeal and the Supreme Court will have these new powers of departure, lower courts will still be bound by assimilated case law. Lower courts are able to make referrals on points of law on assimilated case law to a higher court if the points are of general public importance.

How willing might the courts be to use these new powers?

These new powers broaden the circumstances in which the Court of Appeal or Supreme Court might choose to depart from assimilated case law but it is not yet clear how keen they might be to do so.

Since the end of the Brexit transition period, the Court of Appeal and Supreme Court have been able to depart from assimilated EU case law in certain, more limited, circumstances (only when it appears right to do so – the same test the Supreme Court applies when departing from its own case law).

Notably, these powers have been considered in two intellectual property cases, with different outcomes. Firstly, the Court of Appeal decided not to depart from (what is now known as) assimilated EU case law in a copyright infringement case. The court had been asked to depart from a body of case law from the Court of Justice of the EU (CJEU) but declined to do so for a number of reasons, including, because it would have created "considerable legal uncertainty". The court reminded itself that these powers of departure should only be exercised with great caution.

Secondly, the Court of Appeal went in a different direction and chose to exercise its powers to depart from a CJEU judgment in a trade mark dispute. The court did not exercise its powers lightly but set out a number of reasons why it was appropriate in this case. For example, the court noted that the CJEU's decision did not contain any analysis of the issue, it was an isolated judgment, and the case law of the General Court and the practice of the EU Intellectual Property Office differed.

The court acknowledged that one the main reasons that the Supreme Court is cautious to depart from its own precedents is because it risks undermining legal certainty. However, the Court of Appeal said that this was of little relevance in this case because very few trade mark proprietors would have based their commercial practices on this aspect of the CJEU's decision.

Although these cases resulted in different outcomes, the Court of Appeal was clear in both judgments that it is cautious to exercise its existing powers to depart from assimilated EU case law, particularly because of the impact it could have on legal certainty.

Osborne Clarke comment

The new powers of departure coming into force on 1 October 2024 will mean that the Court of Appeal and the Supreme Court are not bound by assimilated EU case law (except so far as domestic case law has modified or applied it and that is binding on the court) and they have a wider basis on which to depart from it.

The courts' powers will also extend to the ability to depart from assimilated domestic case law influenced by assimilated EU case law. However, any decision to depart from assimilated domestic case law would have to meet the existing test for the Supreme Court to depart from its own precedent – where it considers it right to do so – while also taking into account any relevant changes of circumstances and the extent to which the assimilated domestic case law would restrict the proper development of domestic law, which potentially provides greater leverage to exercise these powers more easily.

Under the current powers of departure, the Court of Appeal and Supreme Court are cautious to exercise their discretion to depart because of the potential impact on legal certainty. Legal certainty will continue to be a key consideration for the courts, perhaps more so because of the potentially wider ramifications for legal certainty the broader departure powers will have. That being said, there may still be legal change ahead as the UK (and its courts) continue to try to grapple with the effects of Brexit.

Although these wider powers come into force on 1 October 2024, they will not be applicable, for example, in cases where permission to appeal was granted before 1 October. Therefore, it may be some time before we see consideration of these new powers by the courts.