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Lawyers In For Britain: The UK and the EU: Benefits, misconceptions and alternatives banner

Many people have legitimate questions about the EU – particularly on subjects such as EU law making, the costs associated with EU membership and the ability of the UK to control its borders. There is a great deal of misinformation circulating on these subjects. The recent Settlement agreed by the EU Council on 19 February 2016 contains reforms designed to allay some of these concerns. We set out below some frequently asked questions and a summary of what we believe are the real answers. A fuller answer is given in the main body of the report under the relevant question.

1. Does membership of the EU prevent the UK from making its own laws? (see more detail)

As a matter of fundamental UK constitutional law, the UK Parliament is sovereign. The UK constitutional mechanism whereby the EU treaties have effect in UK law and why the EU institutions are able to pass legislation that directly affects the UK is through the European Communities Act 1972. The 1972 Act also recognises the supremacy of EU Law.

EU law is required for the EU to function effectively. The relevant legal principles were well established before the UK joined the EEC in 1973.

The single market could not operate without common rules to replace a patchwork of different and often conflicting national laws. These laws ensure that UK citizens and businesses are not discriminated against in the rest of the EU.

EU law making has been limited for over 20 years by the subsidiarity principle: “Europe where necessary, national where possible”. In other words, it is an established legal principle that the EU should only legislate in respect of matters that are better achieved at EU level.

Subject to this important limitation, the European Commission, Council and Parliament can pass legislation that affects all Member States equally. All three institutions have democratic foundations and are accountable in different ways.

The UK Government, Parliament and citizens play a significant role in EU law making. The UK Government voted in favour of 90.7% of all EU legislation in the period from 2009 to 2012 and secured opt outs from laws which it does not want – particularly so that the UK can retain control over its borders and keep the pound.

In practice, the UK has had significant influence over the development of single market legislation particularly in relation to telecoms, energy and financial services where EU legislation is largely based on the UK model.

If the UK were to leave the EU, it would have no real say on EU legislation but in order to continue trading with the EU much of UK business would remain subject to EU law.

The interests of UK citizens and businesses are protected by the Court of Justice of the European Union (CJEU), which is responsible for the rule of law within the EU. The UK has a right to appear in all cases and it has the right to nominate judges reflecting the UK common law tradition as an important element in EU law. Those protections would be lost were the UK to leave the EU.

The 19 February Settlement contains a provision stating that EU Treaty “references to ever closer union do not apply to the United Kingdom” so that the UK is not committed to further political integration.

2. Is there too much regulation coming from Brussels? (see more detail)

The need to limit EU legislation to what is needed has been accepted as a principle of EU law for many years and efforts are ongoing to consolidate and streamline existing regulation. However, one important element of EU law, reflected particularly in the single market programme, was to reduce the regulatory burden on EU businesses by having a common set of rules that businesses can rely on throughout the single market.

The House of Commons Library estimates that less than 7% of UK primary legislation and less than 15% of UK secondary legislation make direct or passing references to EU law.

Some regulatory intervention will always be required and, if the UK were to leave the EU, it is likely that most EU regulation would need to be replaced rather than repealed in order for UK goods and services to be accepted in other EU countries.

The detail of many regulations in the UK are a product of UK, rather than EU, laws.

The Settlement recognises the need to reduce red tape even further, stating that the EU institutions and Member States should “make all efforts to fully implement and strengthen the internal market” and take “concrete steps towards better regulation”, for example by “lowering administrative burdens” in particular for “small and medium enterprises, and repealing unnecessary legislation”.

3. If the UK leaves the EU, would the European Court of Human Rights still have jurisdiction over the UK? (see more detail)

The European Convention on Human Rights, its Council and its Court are separate from the EU. The CJEU takes account of the Convention within the scope of EU law but the CJEU has no jurisdiction to apply the Convention or the EU Charter of Fundamental Rights outside the scope of EU law.

The UK’s membership of the Council of Europe would not be altered if the UK left the EU. The law of the ECHR was incorporated into UK law through the Human Rights Act 1998 and, even if that legislation were amended or replaced, the Government has indicated that it has no intention of leaving the Council of Europe.

The EU Charter on Fundamental Rights protects UK citizens and businesses from interference with their rights by the EU institutions and the authorities of all the Member States when they implement EU law.

4. Are EU institutions too big and inefficient? (see more detail)

The EU bureaucracy is relatively small given the overall size of the EU economy and its population of over 500 million people.

The EU institutions employ 55,000 persons (less than 0.05% of the EU population). In comparison, the UK’s Department of Work and Pensions alone has over 91,000 employees and UK central government employs some 400,000 people.

5. Is membership of the EU too costly? (see more detail)

It is difficult to quantify the precise impact of EU membership on the UK economy because it is impossible to say with any certainty what the UK economy would have looked like had the UK not joined the EU in 1973.

The EU budget represents less than 1% of GDP and is shrinking in real terms.

The gross contribution made by the UK to the EU budget in 2014 amounted to €14,072 million. The financial contribution paid out under the EU budget to the UK amounted to €6,985 million resulting in a net contribution of €7,088 million.

The UK’s net contribution is less than that of Germany or France. On a per head of population basis, the UK is the eighth highest contributor.

The UK’s net contribution of about €7 billion to the EU budget was less than 1% of UK Government’s forecast expenditure of £732 billion in 2014.

Some parts of the UK (such as Wales and Northern Ireland) receive more in direct grants from the EU budget than they contribute per head.

Limiting discussion to the UK’s contribution to the EU budget does not reflect the broader benefits of EU membership to the UK overall. The Government has noted that these benefits may be in the region of £3,300 per year per household.

A recent survey of more than 100 economists by the Financial Times underscored the economic consensus that the UK’s prospects would be damaged by withdrawal from the EU. Of those surveyed, 67 thought the UK’s economic outlook would deteriorate if the UK were to leave, while none thought it would improve.

6. Can the UK control its borders if it remains in the EU? (see more detail)

The UK has the right to control its borders and can check anyone entering the UK no matter where they come from.

The largest category of migrants in the UK come from outside the EU (including from countries such as Syria and Iraq) and the UK’s ability to restrict their entry is unaffected by EU law.

The right of free movement has been a fundamental feature of EU law since before the UK joined the EEC in 1973. It gives UK and other EU nationals the right to work and study in other EU countries, benefiting both individuals and businesses.

Both the OECD and the UK’s Office for Budget Responsibility consider that immigration helps address skill shortages and the consequences of an ageing population. The evidence suggests that on average, EU migrants make a positive contribution to the UK economy and pay more taxes than they receive in benefits.

EU law gives EU nationals the right to work and study in other EU countries. But EU nationals do not have an unlimited right to enter and remain in the UK. Most importantly, the right to live in the UK without any conditions or formalities lasts only for three months. EU nationals can also be refused entry into the UK on grounds of public policy, public security or public health.

As well as tightening up the rules on sham marriages and on suspected terrorists and criminals coming to the UK, the Settlement introduces an “emergency brake” to restrict EU migrants in the UK claiming in-work benefits for a period of up to four years.

7. Are the EU’s accounts fraudulent? (see more detail)

The Court of Auditors monitors EU spending closely and has signed off on the EU’s accounts for every year since 2007. It has noted some errors in the procedures for making payments but, as the Court of Auditors has said, these errors are “not a measure of fraud, inefficiency or waste”.

8. Does EU regulation stifle the City of London? (see more detail)

Far from stifling the City, EU membership has provided the City of London with substantial benefits allowing it to be one of the leading international financial centres in the world.

EU membership gives the City of London access to the single market. Losing this access would represent a substantial risk to London retaining its current international status.

As for the quality of EU financial regulation, the UK has contributed actively and successfully to rules which enable the UK authorities to have far greater assurance as to the safety and soundness of the large number of financial firms from other EU jurisdictions that operate in the UK.

9. Would the UK have more trading influence outside the EU? (see more detail)

There is a real danger that, by leaving the EU, the UK would be isolated and have less influence in the world.

Leaving the EU would mean that the UK would lose the benefits of, and have to renegotiate, over 50 EU trade agreements with other countries with no guarantee of a successful outcome. Current and future EU trade deals include market opening agreements with the US, Canada, South Korea, Japan, ASEAN and Mercosur.

Some of the UK’s key partner countries have stated explicitly that the UK has greater influence within the EU and could be side-lined if it left. President Obama confirmed that the US is “looking forward to the United Kingdom staying a part of the European Union”, while his trade representative formally ruled out a preferential bilateral agreement for the UK. Prime Minister Modi referred to the UK as India’s “entry point to the EU”, while President Xi encouraged Britain “as an important member of the EU” to play a constructive role in strengthening China–EU ties.

10. Would the UK be stronger following a decision to leave the EU? (see more detail)

There is no evidence that the UK would be stronger if it left the EU. Indeed, there is a real risk that a decision to leave the EU would damage the cohesiveness of the United Kingdom and its Overseas Territories.

The adverse consequences of the UK leaving the EU on the peoples of Scotland, Wales, Northern Ireland and Gibraltar are potentially significant:

o   the re-imposition of controls on the Northern Ireland/Ireland and Gibraltar/Spain borders would be contentious.

o   the SNP and Plaid Cymru have called for the UK’s constituent nations to have a separate vote on the UK’s departure from the EU.

o   the First Minister of Scotland has indicated that if Scotland votes to remain in the EU but the overall result is to leave, this could open the door to another referendum on Scottish independence.