Retained EU Law Act: what it means

Business and trade

Businesses have experienced a lot of change in the last few years because of Brexit, with an array of different obligations now on them. This often makes it more challenging to sell into international markets with different requirements and standards.

The Retained EU Law Act will add to this burden of work, as well as creating the possibility that businesses will have to adhere to divergent standards within the UK. This will lead to a lack of certainty that businesses need in order to work, plan and trade effectively.

The Act poses the following risks:

• businesses could face a scenario in which the Internal Market Act undermines law in Scotland that requires high standards. This could occur if the UK Government chooses to sunset or amend, and deregulate, in areas such as food standards, while Devolved Governments choose to preserve the higher standards in retained EU law.
• it could breach the free trade agreement signed with the EU in 2020, which would negatively affect UK businesses at an already difficult time. This was recognised by European Commission Vice-President Maroš Šefčovič at the EU-UK Parliamentary Partnership Assembly in early November: “divergence will carry even more cost and will further deepen the barriers to trade between the EU and the UK…. divergence means more friction and less trade – simple as that. And again, this in times of severe economic strains”.

Institute for Directors

“The UK government was right to rethink the Retained EU Law Bill. The IoD has been a strong business voice arguing that the speed at which government intended to review retained EU law was a recipe for bad law-making. As initially drafted, the REUL Bill gave rise to a level of regulatory uncertainty which was unhelpful for business. Our own data shows that a half of IoD members would prefer the government to leave the existing regulatory framework unchanged. Business will welcome a more focused and depoliticised process, making clear which rules and regulations are being changed. It is also important to ensure that any proposed changes are subject to appropriate consultation with relevant stakeholders, including the business community.”

Law Society of Scotland

“Individuals and businesses will still need to take advice on the status of the retained EU law which may affect them as changes can be made by regulations in the future.”