European Economic Legal Order After Brexit

Legacy, Regulation, and Policy

Enzo Cardi

• Publisher: Routledge
• Year: 2021
• ISBN:
  9781000426137
• Edition: 1
• Topic: Economia
• Subtopic: Economia comparata

This book takes an innovative approach to provide a mirror perspective of the legal systems of the UK and the EU in contemporary institutional scenarios.

At the beginning of the second decade of the 21st century, the legal systems of the EU and the UK are facing challenges of epic proportions. Never before have the two legal orders been confronted with the simultaneous impact of a series of events. First, the effect of the "divorce" between the two regulatory systems caused by the UK's withdrawal from the EU. The Negotiating Documents and the Draft Texts being discussed and aimed at leading to a `New Partnership' are examined in the book. Second, the book discusses the impact of the coronavirus shock in all European economies leading to a substantial change of political perspective in the EU legal order implying innovative debt instruments. Third, it explores the consequences of the judicial activism of the German Constitutional Court undermining the strategic role of the European Central Bank and the primacy of the European Union Court of Justice. The book questions the effects deriving from the legacy, i.e. the foundations of the two legal systems, on handling the issues of our time, the impact on market regulation of the striking contemporary events and the unsettled consequences on policy of the current convulsing political and financial landscape.

The book will be essential reading for those working in the areas of European public regulatory law.

Part 1

LEGACY

Chapter 1
ORIGINS

“It is necessary to form a treaty to which all the principal parties of Europe should bind themselves to protect and support each other as a general system of public law in Europe” (WILLIAM PUT, THE YOUNGER, 1805)

Intellectual Legacy

It may seem paradoxical that the idea of a treaty among the main European parties, establishing a general system of public law, was the vow of an English statesman who lived in the age of global Britain, i.e. in the era of the maximum deployment of the concepts of sovereignty and national identity. It is much less paradoxical if we consider that the idea did not – in William Pitt’s words – involve Great Britain.

From a more remote historical point of view, the EU’s modern “general system of public law” geographically coincides (apart from Poland, some northern countries and some German “Länder”) with the ancient Roman Empire and this coincidence also embraces the UK, although limited to England and Wales.

English legal history actually begins with Roman Britain. For four centuries England was an integral part of a single political and institutional system_

“Alongside and allied to this is the fact that it was a world dominated by the rule of law, which closely regulated the relations between the individual and the State and between one man and another” [P. SALWAY (1981)].

As is often said, law is a language and the Roman heritage is still perceived today through language.

Since the origins of the history of European nations, in constructing their legal systems both continental and Anglo-Saxon languages have used terms inherited from the Latin world “ius”:

“à partir de ius s’est forgé tout un vocabulaire qui passera du latin aux langues européennes avec la renaissance médiévale du droit romain dans les universités” [S. KERNEIS (2018)].

Terms like “jurisdiction”, “judge”, “juridique”, “judiciary”, “jurisprudence” and “justice” have equivalents in all European languages: a semantic legacy witnessed by ancient documents such as the writing of the Magna Carta. It was precisely on “Latin” words that the legitimacy of fiscal power was formulated: fiscal power could not be levied except “per commune consilium regni nostri”, clause 12 (“[…] by the common counsel of our realm”) [A. ARLIDGE, I. JUDGE (2014)].

This is an inheritance witnessed also by the name of the constitutional writ aimed at challenging unlawful detention: habeas corpus ad subjiciendum (the full name – as pointed out by the main authorities – “betraying its venerable origin” [T. BINGHAM (2010)]. Analogously, later the Petition of Rights (1628) clarified that its rules derived from the “legem terrae”: contemporary authors note that those rules already included “elements of substantive law and procedural propriety” [D.J. GALLIGAN (1996)].

On the other band,

“les difficultés des juristes à construire un droit européen illustrent bien sȗr la diversité des cultures juridiques […] de l’attachement des nations à leurs droits et aux traditions qui les fondent” [S. KERNEIS (2018)].

In the complex scenario of different legal traditions, l’”affaiblissement de la culture latine” represents an original historical mark de la diversité juridique of the British Isles.

Historians note that the oldest Anglo-Saxon legislative sources belong to the rules of Kent (VII century) and “contrairement aux lois du continent rédigées en latin” [S. KERNEIS (2018)] the rules are written in the old English language.

The documents written in Latin survived through universities and the Inns of Courts until the 15th century: “the first translations [of the Magna Carta] into English date from this period” [A. LYON (2019)]. But the early formation, from the 12th century onwards, of a national system of law (Common Law) implied a more limited influence of Roman law in England than on the continent, with the exception of the ecclesiastical courts “which clung to the vestiges of Roman Law” [B. ABEL-SMITH, R. STEVENS (1967)]:

“from the middle or end of the thirteenth century, no lawyer in an English Common law court, for example, would have thought to build an argument on texts drawn from Roman Law” [J. BELL, C. KILPATRICK (2006].

On the other hand, on the continent in the 11th century, the rediscovery in Italy of ancient Roman law instead nurtured the foundations of what was the beginning of a “European legal science based on the study of the compilation of Roman law” [R. LESAFFER (2009)] and which, thanks to the confluence of Roman and Canon law, gave rise to what was known as ius commune.

It is not surprising, therefore, that over time the advocates of a European private law system (“the common private law of Europe”) sought links with historical traditions, especially recalling the peculiar amalgam of learned law given by ius commune. The end of the 15th century marked the resolution in favour of learned law throughout Europe, but with the clear exception of England.

At that time the distinction was already clear.

“‘Civilian’ was the term commonly used to describe English lawyers trained in the Roman hand canon laws whose careers were spent in the several courts where the European ius commune provided the principal source of substantive and procedural law” [R.H. HELMOLTZ, in D. IBBETSON et al. (2019)].

Historians have often stressed the hostility towards “civilians” felt by most English common lawyers. On the other hand, the issue is even more complex if one looks at the foundations of the various sources of English law.

From this point of view

“so far as there is any consistent theory of custom at all in Roman Law, it is clearly relegated to a subordinate position among the sources of law” [C.K. ALLEN (1964)].

A broader question, however, is its influence in the foundation of the doctrine of precedent or “how far Roman Law directly inspired the beginnings of our equitable jurisdiction” [Ibid].

The topic is very broad and embraces the history of relations between common law and ius commune. For our purposes it will be sufficient to note that:

“Durant les siècles qui suivirent, ils divergèrent pour former deux grandes familles, celle des droits issus de ce que les juristes anglo-saxons considèrent être Civil Law, le droit romain, et celle des droits de Common Law, un droit des juges prétendu coutumier. L’opposition allait durer, elle divise aujourd’hui l’Europe” [S. KERNEIS (2018)].

The gap in intellectual origins was widened by the European civil codification process in the early 19th century. The “codification” movement was rejected by the common law tradition, which was formed on the grounds of private law based on custom and case law rather than on a code.

From the specific point of view of public law, the original elements that characterized English “patterns of institutional notions” [P. CANE (2009)] may be traced back to the Middle Ages as well. Sporadic traces of a single remote language can also be found in legal terms of public law: e.g. the evolution of the concept of ultra vires to denote an excess of authority by independent statutory bodies or the notion of locus standi in the judicial review to indicate the legal capacity to challenge an administrative decision.

These are limited examples reflecting common origins but stemming from a remote past. Although they apparently recall “vieilles categories fondamentales public/privè”, they leave traces that even today continue to inspire visions (infra Ch. 2) and that determine the foundations (infra Ch. 3) of the current relationship

“entre droit et économie dans l’élaboration de la norme ou bien encore de la concurrence entre Civil Law et Common Law à travers notamment le projet de construction d’un droit européen” [S. KERNEIS (2018)].

The age of “accession”

Given the remote traces of a single legal system of public law, it is only in contemporary times, and particularly in the last forty-six years, that a historical period has given rise to a general system of public law in Britain and continental Europe.

Our contemporary era marks a historical shift in the construction of a single system of public law even for the main continental countries. The new age, an age of accession, began in 1957 and lasted until the beginning of the 20^th century (2004). It was characterized by the continuous enlargement of EU “boundaries” due to new accessions, from the six initial founders (France, Germany, Italy and the Benelux countries) to the 28 EU Member States. An extension of boundaries that was

“to become larger than the Roman Empire, let alone the Holy Roman Empire, had ever been. It now includes countries that had not been part of either, and indeed countries that never accepted the aim of a federation, like Britain. The effect is undoubtedly one of overstretch, not only in physical and financial terms, but also in terms of having brought in societies where the values of the old members are not fully shared” [B. HEUSER (2019)].

The economic legal order

In this context, the sole certain and unifying assumption among Member States is given by the European Union as an “economic legal order”, opened by the Treaty of Rome (1957) and introducing the elements of the Common Market, the Single European Act (1986) developing the tools of the single market itself and the Treaty of Maastricht (1992) providing new instruments for financial, budgetary and stability regulation.

The economic objectives were (since the very origins) part of political objectives, the latter being oriented towards the establishment of general political power: a political project with emotional roots, deeper than the economic rationale shared (at least initially) by the original founders.

Further and consistent developments in this direction led to the elaboration of the European Constitution by the convention established by the Declaration of Laeken on the “Future of the European Union” (December 2001) and chaired by Valery Giscard d’Estaing. This text, including substantial modifications (necessary for approval by all EU Member States) became part of the treaty establishing a “Constitution for Europe” which was solemnly signed (as the 1957 Treaty) in Rome on 29 October 2004.

The “Constitution” was aimed at a European political – as well as economic – order in whic...