Rulemaking outside the EU

Published 16/06/2022   |   Reading Time minutes

Before the end of the Brexit transition period, the UK and EU had mostly the same rules. Since the period ended on 31 December 2020, UK and EU rules for all sorts of things can differ or stay the same. This is subject to international law, including the Withdrawal Agreement and Trade and Cooperation Agreement.

Wales, Scotland and England can also have the same or different rules from each other. This is subject to new domestic arrangements including common frameworks and the UK Internal Market Act 2020.

These arrangements apply to Northern Ireland but are subject to the separate arrangements of the Northern Ireland Protocol, whereby it continues to follow some EU rules.

‘Divergence’ is the term used for when rules differ.

‘Alignment’ is the term used for when rules are the same.

Divergence and alignment have consequences

Governments take several factors into account before setting rules for all sorts of things, such as trade and the environment. There are advantages and disadvantages to having the same or different rules as other places.

For example, diverging allows governments to make rules that are more responsive to local needs, but this risks creating trade barriers that could lead to increased costs for businesses and consumers.

On the other hand, aligning allows governments to work together to tackle common problems, such as transboundary environmental issues, but this might mean compromising their own plans or ambitions.

Governments can either choose to diverge or align with each other, or do nothing in response to changes elsewhere, allowing divergence to develop. This is known as ‘passive divergence’.

The new UK-EU map

Our new interactive map shows different post-Brexit scenarios and what they mean for divergence and alignment between the four UK nations and the EU.

It starts on 31 December 2020, when the UK and EU had mostly the same rules in place (with a few exceptions, including for workers’ rights and waste).

This infographic has been created by Senedd Research for the purpose of illustrating the combinations above. More combinations are possible.

The UK and EU can have different rules now

After withdrawing from the EU on 31 January 2020, the UK continued to follow its rules during a transition period which ended on 31 December 2020. In preparation for the transition period, EU law which applied in the UK was converted into domestic law and called retained EU law (REUL). Since 1 January 2021, the UK no longer needs to follow EU law and UK-EU divergence has already begun.

The UK in a Changing Europe’s divergence tracker shows 27 cases of UK-EU divergence and 11 more cases where UK-EU divergence has impacted internal relations between the four UK nations. The cases cover a wide range of areas, including animal welfare, employment, foreign policy, levelling up, mobility and travel.

The UK Government plans to introduce a Brexit Freedoms Bill soon to make it easier to change or repeal REUL and to remove the special status it has in UK law. This could lead to more UK-EU divergence.

In the Trade and Cooperation Agreement, the UK and EU agreed a system for managing divergence between them to keep competition open and fair. This is known as the level playing field. Among other things, its rules allow the UK and EU to retaliate if divergence between them has a material impact on trade or investment. They have also promised not to roll back their environment, climate, labour and social standards.

Wales, Scotland and England map their courses

Wales, Scotland and England may also align with, or diverge from the EU. Their approaches are described below:

  • the UK Government has set out its ambitions to “make the most of its regulatory freedoms”;
  • the Scottish Government intends to align with EU law “where appropriate”, using powers in the UK Withdrawal from the EU (Continuity) (Scotland)Act 2021;
  • Wales’ Counsel General said in January 2022 that the Welsh Government aims to maintain or improve on EU standards, but also said in October 2021 that it has no internal central mechanism for monitoring changes in EU law.

Northern Ireland follows some EU rules under the Protocol

In the Northern Ireland Protocol, the UK and EU agreed that Northern Ireland would continue to follow some EU rules, while the rest of the UK (as Great Britain) could change its rules.

This moves the location of EU border checks from the Northern Ireland/Republic of Ireland border to arrival points in Northern Ireland from Wales, England and Scotland. This is sometimes referred to as having created a ‘border in the Irish Sea’.

The EU rules which Northern Ireland continues to follow can be found in the Protocol’s annexes and include rules for customs, trade, the environment, food, medicines, animals, VAT and more.

The arrangements are the subject of UK-EU disputes and the Northern Ireland Protocol Bill, if passed.

Managing internal UK divergence gets underway

Since Brexit, a number of new domestic mechanisms have been put in place to manage internal UK divergence between Wales Scotland, England and Northern Ireland (subject to the Northern Ireland Protocol). These are:

Common frameworks

Since 2017, the UK and devolved governments have agreed to work together in some areas previously covered by EU membership. There are 26 common frameworks planned in areas devolved to Wales, such as for agriculture, fisheries and air quality. Most were published in late 2021 and early 2022 and are now undergoing Senedd scrutiny.

Internal Market Act 2020

The UK Parliament passed the UK Internal Market Act 2020 to ensure that goods, services and professional qualifications sold or recognised in one part of the UK can be sold or recognised in another part. The Senedd did not consent to the Bill, with committees arguing it would reduce the practical effect of Welsh law.

The governments can agree exclusions from the Act, including through common frameworks. This year, they reached agreement on an exclusion for bans on certain single-use plastic items.

Plain sailing or deep waters? Experts advise the Senedd

The Legislation, Justice and Constitution Committee has received evidence from experts through the Senedd’s Brexit Academic Framework.

  • Professor Catherine Barnard provides an overview of the scope for UK-EU divergence, including how it might develop between the devolved nations and the EU, and explains its consequences under the Trade and Cooperation Agreement; and
  • Professor Jo Hunt reports on the legal and policy constraints on the exercise of competence by the Senedd and the Welsh Government post-Brexit in the fields formerly covered by EU law.

Beyond the horizon

The Welsh Government’s ambition to maintain and improve EU standards where possible means keeping a close eye on changes at the EU and in other UK nations.

Such careful decisions affect daily life in Wales - from the environment to food, and from trade to human rights. This requires considered decision-making, or else accepting the consequences of passive divergence.

Article by Sara Moran, Lucy Valsamidis, Nia Moss and Joe Wilkes, Senedd Research, Welsh Parliament