Category Archives: Britain

Britain, Legal, Media, Society

Libel threat to the Press is facing axe

PRESS REGULATION

The Conservatives have said they will scrap a draconian law on the Press that would have forced newspapers to pay all legal costs in a libel case even if they won.

The party’s manifesto, released earlier this week, pledged to repeal Section 40 of the Crime and Courts Act and spare papers from “crippling” costs. The party has also said it would axe the second stage of the Leveson Inquiry into Press Culture, practices and ethics.

This was expected to investigate law-breaking and improper conduct by media organisations, following the first stage into phone hacking and whether police were complicit in misconduct.

Also, websites that benefit from newspaper content could be pressured to share advertising profits.

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Britain, Economic, European Court, European Union, Government, Legal

Free-trade deal possible post-Brexit following landmark EU court ruling

FREE TRADE AGREEMENT

ECJ

The court ruled that Brussels has trade negotiating competence over all goods and services.

Britain’s ambition to sign a quick Free Trade Agreement with the European Union after Brexit has received a significant boost after a landmark ruling by the European Court of Justice handed expanded trade negotiation powers to Brussels.

The much-anticipated decision from the court in Luxembourg surprised experts by ruling that on key areas – including financial services and transport – the European Union does not need to seek ratification of a trade deal by the EU’s 38 national and local parliaments.

Trade experts said the ECJ ruling could substantially reduce the risk of any future EU-UK free trade agreement getting bogged down in the EU national parliaments, opening the way for an FTA to be agreed by a qualified majority vote of EU member states.

“The Court of justice says all services – even transport – can be ratified by a qualified majority vote, which is potentially quite a big opening for the UK,” said Steve Peers, professor of EU law at Essex University. “It could certainly make things easier.”

In the ruling, the ECJ was asked to decide whether the new-generation bilateral EU-Singapore trade deal should be treated as a so-called ‘mixed’ agreement – that requires ratification by national parliaments – or could be agreed by a qualified majority vote of member states.

The court ruled that the EU did not have exclusive competence to conclude the Singapore deal, but said that only in two narrow areas – namely non-direct foreign investment and the investor-state dispute resolution mechanisms – did it need to seek ratification by national parliaments.

By contrast, the court said the EU did have competence to conclude agreements without ratification across the great majority of the Singapore agreement – contradicting parts of a previous opinion by the court’s advocate-general.

The court ruled that Brussels has trade negotiating competence over all goods and services.

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Definition, meaning and purpose of a Free Trade Agreement (FTA).

Areas covered by EU competence include all goods and services, “including all transport services”, as well as intellectual property rights, competition policy, labour and environmental standards and the rules relating to exchange of information.

Legal and trade experts said the ruling had potentially massive implication for Brexit if the UK formulated its own FTA to avoid investment provisions and investor-state dispute mechanisms, relying on alternative arrangements such as bilateral investment treaties and WTO panels.

“This is the most significant ECJ case on EU trade policy for twenty years and has huge ramifications for any UK-EU FTA,” said Nicole Kar, head of international trade at Linklaters, the law firm.

“In policy terms, now the UK government will want to consider whether it moderates its ambition for the UK-EU FTA to those matters where there is exclusive competence in order to secure agreement through EU Member State governments by qualified majority voting.”

If Britain took a more expansive approach, Ms Kar warned, it risked any FTA getting mired in member state politics as happened last year when the regional Walloonian parliament of Belgium held the EU-Canada trade deal to ransom.

This problem arises because some EU member states, like Belgium, have domestic law that requires local parliaments to sign off on trade deals before they can be ratified by at a national level.

Allie Renison, head of EU and trade policy at the Institute of Directors, said the court ruling was to be welcomed and would make it easier for the EU to conclude deals “without fear of as many hold-ups from national and sub-national legislatures”.

“How this affects Brexit negotiations will depend on whether the final trade agreement includes investment provisions or not, although neither the UK or EU has expressed much interest in this to date,” she added.

“It’s important to remember that any eventual UK-EU trade agreement would not be about opening up each other’s markets in controversial areas, but trying to limit the amount of disruption to trade, and so it is unlikely to encounter the same resistance from other EU countries once concluded by the Commission.”

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Britain, Consumer Affairs, Government, Politics, Society

Imposing a price cap will not improve the energy market

ENERGY MARKET

Energy costs

A series of remedies have been called for to encourage greater switching.

The energy market does not work well. Consumers who shop around by believing they have obtained cheaper tariffs soon find they will be paying higher prices not long afterwards when the special deals they signed-up to expire. Unless people are prepared to spend time looking out for better terms, or by getting another company to do it for them, they will likely end up with a bigger bill than they should. Energy consumers are being trapped into a false sense of security.

With energy costs increasing for a variety of reasons – not least because of onerous environmental requirements imposed by the state – the cost of energy has become a toxic political issue. The Labour Party recognised this prior to the last election when it pledged to cap prices.

Now, the Conservatives under Theresa May – who ridiculed this policy when it was proposed by Ed Miliband – plan to do the same if they win the general election on June 8. Mrs May has said the Big Six were ‘ripping off’ consumers and has stated that the Conservative manifesto would regulate the maximum costs of the standard variable tariffs on which most users are parked. The analysis offered suggests this will save the average customer around £200 a year. But, even if we accept that the market is flawed, price controls are not the best way of addressing this. It is not for a free-market Government to decide the right price for a commodity but rather to encourage competition by allowing people to make their own choices.

Big Six Cashing In

There are several price comparison websites that help consumers switch suppliers, as some two million have done over the past six months. But millions more stay with the same company; and it is this inertia on which the companies rely allowing them to freely hike up prices with impunity. One thing a cap will do is bring down prices for many users.

On the other hand, it will simply consolidate the lack of movement by entrenching consumers to stay with their present provider: if you know that the price is capped why look around for a better deal? What is more, if the cap is set too low it will force small suppliers out of the market; too high and prices will gravitate upwards.

Following a review last year, the Competitions and Markets Authority recommended against a variable tariff price cap and called for a series of remedies to encourage greater switching. The energy companies say the Conservative policy would destroy competition, jeopardise jobs and deter vital investment. Yet, if that is the case, rather than constantly complaining, they would be well advised to make sure that the market works for the benefit of all their customers.

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