Dr. Young presents Interdisciplinary Research on Organized Crime Control to the Ministry of National Security, Jamaica

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By Mary Alice Young:

Dr. Mary Alice Young (Law) and Dr. Michael Woodiwiss (History) are in Jamaica today to conduct a series of evidence-informed research presentations with members of the Jamaican law enforcement and policy making communities (the project has been fully funded by ACE).

Based on empirical research carried out in January 2018 in Kingston (one week before Jamaica’s government declared a State of Emergency in Montego Bay due to a rise in firearm deaths), the two UWE staff will present their research findings to law enforcement officers in the Jamaica Constabulary Force, and also in separate meetings to ministers from the Ministry of National Security.

They will also be presenting a preliminary paper for consultation, with a view to informing future policy making in the area of organized crime control in small island and developing states.

Professor Chinkin gives the Annual Lecture of the Welsh Institute for International Affairs (co-sponsored by UWE)

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By Jackie Jones:

The Annual Lecture of the Legal Affairs Committee of the Welsh Centre for International Affairs took place on 3rd May 2018, co-sponsored this year by the Law School. Professor Christine Chinkin, Director of the Institute for Gender, Peace and Security at the LSE, spoke about the Council of Europe Istanbul Convention: the negotiations, the sticking points and the value added of the newest regional convention to eliminate violence against women and girls. She also mentioned the ongoing campaign to pass a UN convention to eliminate violence against women and girls, which Prof Jackie Jones is heavily involved in – having just published a co-edited book making the legal case for a new treaty (with Prof Rashida Manjoo). Jeremy Miles, AM, Counsel General for Wales, was present to listen to the added value for Wales outlined by Prof Jones – lobbying to encourage Wales to pass legislation complying with the provisions of the Istanbul Convention. Wales is a world leader in eliminating violence against women, passing world-first legislation in 2015 and appointing National Advisors to eliminate violence against women. The entire lecture was recorded by BBC Radio.

Professor Chinken speaking next to WCIA banner

Dr. Philippe Karpe attends Centre for Applied Legal Research as Visiting Scholar

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By Noelle Quenivet:

Between 10 February and 10 March 2018 the Centre for Applied Legal Research hosted Dr Philippe Karpe as Visiting Scholar. Dr Philippe Karpe is a senior legal researcher and international expert working for CIRAD, a French agricultural research and international cooperation state organization working for the sustainable development of tropical and Mediterranean regions. Worldwide there are 850 CIRAD researchers assigned in 40 countries involved in an array of projects. Dr Karpe is currently posted in Nairobi, Kenya. Invited by the International Law and Human Rights Unit and the Environmental Law Research Unit it was a pleasure to have him with us. Dr. Karpe took part in a wide range of teaching and scholarly activities offered by the Bristol Law School, as well as pursuing his own research on indigenous people and the management of natural resources.

By education Dr Karpe is a public international lawyer who studied at the universities of Nancy, Paris 10 and Strasbourg in France and holds a ‘habilitation à la direction de recherche’ (Accreditation to supervise research) – a French post-doctoral degree allowing him to supervise PhD students. Besides supervising PhD candidates at CIRAD he also teaches at the universities of Strasbourg (France) and Hokkaido (Japan). The bulk of his work however consists in planning and running projects with and for international organisations (eg United Nations Development Programme-UNDP, World Bank), NGOs (eg Rainforest Foundation Norway, Organisation des Nations Autochtones de Guyane-ONAG) and other stakeholders applying his expertise on governance and rule of law, including indigenous peoples’ rights (general and particular rights, especially land rights, forest’s and carbon’s rights, forest users’ rights, women’s rights), socio-environmental safeguards, sustainable forest management, rural and forest land tenure (including for the implementation of the Voluntary Guidelines on the Responsible Governance on Tenure of Land, Fisheries and Forests in the Context of National Food Security-VGGT), participative management of lands (including the use of artificial intelligence), participative mapping, institutional arrangements and stakeholder commitments (civil society, forest communities, etc.).

Dr Karpe led workshops on three modules (‘Natural Resources’, ‘Corporate Governance and Corporate Social Responsibility’ and ‘European Environmental Law and Policy’) offered on our LLM programmes. In each of these modules he shared with the students his extensive knowledge and practical expertise in the relevant fields. He brought law to life by using concrete legal problems he had been confronted with in his own field work.

For example, in the module ‘Natural Resources’ led by Prof Jona Razzaque Dr Karpe produced real forest legal texts that were enacted by regional, national and local public authorities. The students could thus see how forests are protected (or not). This helped the students to better understand the practical application of the law as well as its (sometimes unintended) consequences on local populations.

In the module ‘Corporate Governance and Corporate Social Responsibility’ the students were asked to engage in a discussion on ethical aspects of activities carried out by multinational enterprises using real contracts that were agreed upon between indigenous people and organisations. Passionate discussions in this workshop run by Dr Karpe and Dr Sabine Hassler on (for example) the protection of traditional knowledge in India and the protection of the intellectual property rights of the indigenous peoples ensued.

This inquisitive and practice-oriented type of engaging with the students was again displayed in the workshop on the EU Common Agricultural Policy (CAP) in the module ‘European Environmental Law and Policy’. Together with the module leader, Christian Dadomo, Dr Karpe challenged the students to analyse the current CAP reform and its interface with the environment and, more largely, the future shape of the society. He notably discussed with the students the negative and positive connections between agriculture, the society and the environment (eg pollution, deforestation, drying up of rivers, etc) and how the reform of the CAP deals with these issues. Dr Karpe’s visit was a great asset to our practice-led and student-centred teaching culture on the LLM programme at UWE.

Throughout his stay at UWE Dr Karpe also took the opportunity to attend a number of external engagement events organised by CALR such as the Brexit and Corruption talk by Dr Lorenzo Pasculli and the Brexit and Trade Relations panel discussion. As a scholar working often far away from European legal issues he particularly enjoyed this insight into one of the most commonly debated issue in the UK: the withdrawal of the UK from the European Union. In this context, he sincerely enjoyed the great variety and quality of the different UWE’s opportunities to develop and enrich the knowledge on many scientific and political vital present concerns.

Dr Karpe had the opportunity to deepen his present academic research especially on Harmony with Nature, the Commons, the indigenous peoples and the farmers by collecting many references and academic articles on the UWE’s virtual library and by daily discussions with colleagues on a variety of topics, some of them relating to research methods and methodology (eg epistemology, social-legal studies and critical legal studies). Furthermore his stay at UWE gave him the opportunity to consider some new academic concerns such as conflict, war and the humanitarian legal framework.

On two occasions Dr Karpe presented his work to UWE staff and students. At a first event he shared with us his practice-based research and at a second reflected upon his work as a lawyer in the field. A roundtable on ‘The Future of the Commons’ was organised on 28 February 2018 to discuss the definition of the concept of the ‘Commons’ and develop the ‘Commons Thinking’. Dr Karpe’s intervention focused on his own experience of the commons in the African context.

For example he was once confronted with what appeared to be an odd situation in a village. The local population did not seem to be related or linked, the concept of society did not seem to apply either and it appeared that each person was working for him/herself. A positive, classic lawyer would have undoubtedly failed to realise that there was something beyond that and that in fact these individuals were connected by a common, shared ‘space’. Dr Karpe then questioned whether the concept of the commons was an answer to this practical/technical problem which could be turned into a political concern. He posited that current values do not conform to aspirations of justice and that contemporary laws do not help support, protect and promote the life of individuals who live in such a situation. Yet, as a lawyer, his job is to establish justice between people and to find solutions to concrete technical as well as political problems. Thus in his view the concept of the Commons appear to be the most suitable tool. However, when trying to write the law of the Commons the lawyer faces the harsh reality of having to acknowledge that law simply is not the most appropriate tool. For example, law is usually split in different areas such as contract law, family law, property law, etc and yet the Commons transcend these separations. Also the Commons are a ‘space for development’ as they create opportunities for changes and evolution. This all makes it difficult to freeze the Commons into law.

Dr Karpe argued that for him it was crucial that human rights be at the centre of all these activities. Law should be created around human rights. He also challenged the vertical relationship of law whereby constitutional law sits at the top of the hierarchy of any national legal system. Whilst he admitted that this might sound revolutionary as lawyers struggle to understand law in anything but hierarchical terms and categories he emphasised that only a horizontal understanding of the law could avoid corrupting the Commons. As he explained his support for the Commons he however warned that the concept of the Commons might in specific contexts be used as a new form of colonialism enabling State and organisations, for example to deny rights to indigenous people on the basis that under the principle of non-discrimination and shared access to resources no special rights should be given to them.

Last but certainly not least Dr Karpe gave a talk entitled ‘Has the Wandering Lawyer Reached his Destination? – The Adventures of a Lawyer Working in the Field’ which gave him the opportunity to reflect on his work. It was an enlightening talk as Dr Karpe shared with us over 25 years of research in Cameroon, the Central Republic of Africa, Madagascar, Democratic Republic in Congo, Gabon, etc. He kicked off this presentation by asking ‘What am I? What is my purpose as a lawyer?’. Looking at the type of jobs he usually carries out he acknowledged that his work tends to touch upon a range of topics (eg weddings, contracts, etc) though it does focus on forestry. Yet, as a human being he questions what his real role is. For him, he should be promoting justice and more specifically social justice.

As a result he does not question the abstract internal coherence of the texts, the content of texts or their effectiveness and efficiency as such. Rather, these are only steps in this research work. The basic research question is ‘under which conditions may the lawyer contribute to improving the living conditions of the local population?’. The objective is thus to understand how law can contribute to improving the living conditions and ensure the protection of a certain idea of a community of life. For this, four assumptions must be made: 1) laws and rules may contribute to social change and lawyers are thus useful; 2) laws and rules have a political function; 3) there is a community of life and 4) the function of laws and rules is to guarantee social peace. Likewise Dr Karpe conceded that there were a number of challenges: 1) working with disadvantageous groups such as indigenous people, rural women, etc; 2) the status of users’ rights in developing countries and 3) the status of peasants. All these challenges relate to various aspects of vulnerability and deprivation of rights. With this in mind the lawyer must think about how he can have a positive impact on society.

In Dr Karpe’s eyes the most suitable way to understand societies and to then be in a position to support them is to conduct extensive research in the field. This means using involved, immersed and applied research techniques so that a concrete and continuous contact with the relevant people can be established.

Dr Karpe also stressed that the nature of the field obliges all actors to adopt an interdisciplinary approach and so he works with economists, anthropologists, biologists, pharmacologists, etc, bearing in mind that each person brings his/her own views and perceptions of the situation and that all these views as well as methodologies need to be integrated into one’s work. Does that mean that the lawyer disappears? Dr Karpe stressed he remains a positive lawyer (one that is trying to find the best solution to a problem that affects people), a humanist (there is no doubt a need for empathy and humility in these circumstances) and a ‘questionnaire’ (a person who asks questions) and thus a ‘wandering lawyer’. In his opinion this ‘wandering lawyer’ has a fundamental political and moral obligation to remember, think, defend and realise the key destiny of a lawyer: social justice. As a result he/she must revise his/her vision of the law, its essence, substance and form. Four main research themes derive from this stance towards law and the role of the lawyer: 1) the commons, the harmony between nature, humanity and values (justice); 2) the nature and the content of the law (juridicity); 3) the tools for implementing the law and 4) the methodologies of knowledge of law.

Dr Karpe presented some of the results of his reflection, explaining that the law should not be in the form of specific provisions, that the new ‘Common Law’ should correspond to a right of communion, a transcendental right and that the new Common Law must correspond to an idea, that of a community of life. Under the Common Law individuals enjoy the same rights and there is no hierarchy of rights. That being established, Dr Karpe questioned the way law is created, articulating the idea that law is often crafted by a certain type of persons for a certain type of person and for a specific objective and that consequently law may not be really that ‘common’ in fact.

As Dr Karpe left UWE he had made contact with many colleagues in the Bristol Law School and hoped to be able to involve these colleagues in his work. He proposed to establish an opened think-thank on the Commons, the Wandering Lawyer, Law and the Juridicity, named: “the Rainbow Team”. Discussions were also had about future collaboration notably in the form of common projects relating to the protection of the environment, biodiversity and conflict. It was with regret that we had to let Dr Karpe go back to his work as it was such a pleasure to talk to him on a variety of topics.

 

CALR Staff Research Seminar Series relaunched

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The Centre for Applied Legal Research (CALR) has relaunched the Staff Research Seminar Series. The first instalment was held on 26 February 2018 and featured two presentations both related to banking and finance law.

Sam Bourton, PhD applicant and Associate Lecturer at the Bristol Law School, opened the session with a paper entitled ‘Revisiting Dishonesty – The New Strict Liability Criminal Offence for Offshore Tax Evaders’. She started by explaining the difference between tax evasion and tax avoidance. Whilst both are ways to minimise financial liabilities, evasion in contrast to avoidance is unlawful. It is the failure to declare income, assets and other activities although taxes are due on them. Tax evasion can be tackled via non-criminal and criminal penalties. Non-criminal tax evasion usually requires the individual to pay what is owed and civil liabilities might arise. If the tax evasion is viewed as criminal then civil as well as criminal penalties might be imposed. The key difference is whether the individual was dishonest. Ms Bourton pointed out that despite the vast range of statutory offences that could be used to tackle tax evasion the UK actually uses the common law offence of ‘cheating the public revenue’ because it is phrased in broad terms an can incur huge penalties. In this case the mens rea element of the crime is of utmost importance: the person must have been acting with dishonesty. The test to ascertain the character of the person and whether he/she is sufficiently blameworthy was spelled out in R v Ghosh and widely criticised notably because there is no one standard in relation to honesty/dishonesty. As Ms Bourton explained that first the jury might not be able to understand the context in which the act was undertaken and second what is an honest or dishonest act hinges on each person’s own understanding of the concept of honesty. As a result it seems that the HMRC and CPS have only prosecuted the worst cases when it was easier to show dishonesty. The HSBC scandal revealed the scale of tax evasion in the UK and yet, HMRC only prosecuted one person and not for tax evasion but for lying on a form, COP9, asking him/her to confess to tax evasion. Recently HMRC has been given a target of 1,000 tax evasion prosecutions to be mounted per year. Concurrently the UK has adopted a new offence in the Taxes Management Act 1970 that allows for the application of a strict liability test, thereby removing the mens rea element of the crime for offshore offences. Here, tax evasion is now punishable by a fine and/or a maximum of six months imprisonment. Whilst many have expressed concern over the new offence, Ms Bourton stressed that it only applied to specific jurisdiction and only covered offshore tax evasion of £25,000 and over. At the same time the Ghosh test was revisited by the Supreme Court in Ivey v Genting Casinos, rendering the application of the test seemingly more straightforward. However, as Ms Bourton pointed out, this is not necessarily the case for cases relating to tax evasion. Ultimately the difference between tax avoidance and tax evasion hinges upon an individual’s own perception and therefore, according to Ms Bourton, motive must be taken into account. It crucially distinguishes between those who abide by the law and those who purposefully choose not to. Ms Bourton then finished her presentation by propounding her own (re)definition of the offence.

The next speaker was Prof Nic Ryder who presented the paper ‘Too scared to prosecute and too scared to jail?’ he had recently submitted to a journal for publication. Prof Ryder contrasted corporate liability as understood in the UK and in the US. He explained that the US had a long history of robust and forceful enforcement. In fact, when the scandal with Arthur Andersen LLP happened and the company was threatened with prosecution it yielded its licence as a consequence of which 25,000 employees lost their jobs. In other words, this move was tantamount to corporate death penalty. In light of this the Department of Justice altered its approach considering the impact of such actions on investors, employees and other relevant stakeholders. With this view it increased its use of deferred prosecution agreements, a move Prof Ryder questioned. Whilst such an attitude is mindful of the wider consequences of the prosecution of a company it is weak on deterrence. Indeed a company such as HSBC with a poor record of compliance with financial regulations such as weak anti-money laundering procedures, violations of the US Secrecy Act and violation of the UN sanctions regime will certainly not be deterred from continuing violating the law if deferred prosecution agreements are the preferred method of the Department of Justice to deal with financial crime. In the UK the situation is different. Courts have accepted the common law standard in relation to corporate liability for crimes which means that as long as it is possible to identify the person who has the directing mind and will of the company (Tesco Supermarkets LTD v Nattrass) a company can be prosecuted for violating financial regulations. In the UK deferred prosecution agreements are only used in relation to breaches of the Bribery Act 2010. Prof Ryder noted that in the UK the focus is increasingly on the prevention of economic crimes and thus verifying whether robust compliance procedures are in place. This, he believes, is a worthy mechanism that ought to be used more widely and not only in relation to bribery offences. Prof Ryder finished by explaining that the UK has launched a call for evidence in 2017 on corporate liability for economic crime and suggested five options for reform. He however believes that none of these options will be adopted as the consequences of the prosecution of banks are enormous for the domestic economy and there is no political appetite for such reforms. In other words ‘too scared to prosecute, too scared to jail’.

 

Brexit and Trade Relations

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This panel discussion with Christian Dadomo, Dr Clair Gammage and Dr Maria Garciatalk was organised by the lecturers of the module ‘EU Law’ offered to Year 3 students and the International Law and Human Rights Unit of the Centre for Applied Legal Research.

Since the beginning of this academic year 2017/2018 third year students on the LLB degree have had the opportunity to listen to a number of internal and external speakers on the issue of Brexit. On 16 February 2018 the team teaching EU law convened a panel discussion on ‘Brexit and Trade Relations’ comprised of Christian Dadomo, Senior Lecturer at UWE, Dr Clair Gammage, Lecturer in Law at the University of Bristol, and Dr Maria Garcia, Senior Lecturer in International Political Economy at the University of Bath. Each of them shared his/her thoughts on the topic and the session was then run in a Question Time format as students had been asked to send questions in advance to the chair, Dr Noëlle Quénivet, Associate Professor in International Law.

Dr Garcia began the session by setting the scene of the Brexit campaign and Brexit in relation to trade. She pointed out that whilst contestation of trade was a global trend and protests and concerns had been voiced against eg genetically modified organisms, chlorinated chicken, the privatisation of the NHS no such discussion was held during the Brexit campaign. Brexit did not seem to be about contesting global trade and its effects but migration and ‘taking back control’. The fact that there was so little discussion on trade might be explained by the fact that trade negotiations could only be held once the UK had left the EU since the EU has exclusive competence in negotiating trade agreements. Also she explained that if references were made to trade during the campaign it was usually about agreements with other States rather than trade as such. As a matter of fact the best prediction about individuals voting leave/remain was not the trade issue but education, attitude towards migration, etc. In preparation to Brexit trade has been becoming increasingly important as Prime Minister Theresa May referred to it in her Lancaster and Florence speeches and Foreign Minister Boris Johnson talked about it to recently. This has no doubt shifted the debate. Still, no discussion is being had on the contestation of trade policies. Dr Garcia suggested this might be due to the fact that it is too early to do so in light of other significant and more urgent problems. It might also be the case that the government has no clear idea of the precise content of future trade agreements. Moreover the UK government appears to send mixed messages, asking for a seamless trade relationship and yet being unable to adopt a clear position on how to tackled the issue of the two land borders through which it will trade (between Ireland and Northern Ireland and between Gibraltar and Spain). The UK White Paper on Trade reflects an inclusive and pro-development approach to trade that will however be difficult to deliver. Indeed, it appears that at the moment the UK is training individuals on issues relating to financial services rather than goods that are key to trade agreements with development features. Further, if the aim of Brexit is to regain sovereignty why should the UK accept American standards as well as dispute settlement mechanisms enshrined in trade agreements? Dr Garcia explained that it appeared that the UK was in fact anchoring itself in a thinking that supported what Steven Gill has described as the constitutionalisation of a neo-liberal regime through trade agreements.

The next speaker, Christian Dadomo, shared his thoughts on what the deep and comprehensive trade agreement favoured by the UK government could look like. Mr Dadomo first explained that before even starting discussions on such an agreement the UK and the EU needed to negotiate and agree on a withdrawal agreement focusing on three priority issues: EU and UK citizens’ rights, a financial settlement and the situation in Northern Ireland. The result of these negotiations were presented in a joint report on 8 December 2017. Such agreement also needs to take into account the future framework arrangements. As Mr Dadomo observed a number of elements are known. First, all free trade agreements the EU has negotiated are different: there is no one, unique solution as it is important that such agreements fit the various interests of the parties. The UK claims that as a soon-to-be former Member State of the EU it already complies with EU law and thus it should not be difficult to agree on such a trade treaty. Any solution between the UK staying a party to the European Economic Area Agreement to the UK applying the World Trade Organisation rules is on the table. On one end of this continuum of solutions is a very close association with the EU. Yet, it is already known that as the UK wants free trade and control over immigration it has expressed its clear wish to leave the Customs Union and the Single Market. Yet, the EU has specified no cherry picking is possible. It is also known that the UK rejects the Norway model as it would mean paying to get access to the Single Market whilst having no say in the law-making process and being obliged to comply with all EU rules, including those on the free movement of persons. On the other end of this spectrum lies the application of WTO rules which is often viewed as the worst scenario possible as it involves the imposition of tariffs on trade and rules of country of origin. In between these two extreme options two types of agreements, modelled on either the EU-Canada Comprehensive Economic and Trade Agreement (CETA) or the EU-Ukraine Deep and Comprehensive Free Trade Area, are available. Mr Dadomo contrasted the two agreements: whilst Ukraine accepts the acquis communautaire, Canada does not; whilst CETA is focused on trade (goods, intellectual property) the agreement with Ukraine also includes provisions relating to security, home affairs and justice. The key problem is that it is still unclear which kind of agreement the UK wishes to have with the EU apart from a ‘deep and comprehensive one’. The possibility of a ‘CETA +++’ has also been formulated. Mr Dadomo stressed that in any case the agreement will have to be bespoke but the possibility to customise some elements also means that conditions can be attached to them. The Swiss model that is highly bespoke is off the table as the EU does not wish further agreements of this type to be negotiated. Mr Dadomo finished his presentation by stating that until the UK clearly specifies what it wishes the agreement to contain it is difficult to provide a legal commentary, ascertaining whether the EU first can legally enter into such an agreement and second would be amenable to conclude such an agreement.

Dr Clair Gammage then turned her attention to the impact of Brexit on trade and human rights. She highlighted the complexity of the issue as it covers a variety of legal regimes and political opinions greatly differ on the subject-matter. First, she reminded the audience that the UK is still a member of the World Trade Organisation in its own right but that negotiations at the WTO are undertaken by the EU. Second, she pointed at the lack of understanding of how trade works on a multilateral level and that the lack of expertise in the UK relating to negotiating trade agreements. Indeed, tariffs (of eg agricultural products) are set by the EU in the WTO and these will need to be renegotiated by the UK. Tariff-free trade might be a solution. The UK has submitted a solution to the split between the EU and itself but other WTO members (eg the US) have already voiced their concerns or even opposition to the proposal. Unfortunately for the UK it is not allowed to discuss any trade agreements until it is outside the EU and this is not only due to the exclusive competence of the EU but such negotiations would also violate WTO rules. The WTO recognises two forms of free trade agreements: free trade areas and customs unions, both covering a wide range of treaties which means that the UK is likely to negotiate successful suitable trade agreements with third parties. The problem is time as such treaties take several years to be negotiated and concluded. Another problem faced by the UK relates to the existing free trade agreements between the EU and third parties. Dr Gammage shared her view that there is no automatic roll over for such treaties which means that they would need to be renegotiated. As for trade standards, she explained that the UK will be bound by WTO standards (including those relating to sanitary and phytosanitary regulations) and, should it wish to export its goods to the EU, such goods would need to comply with EU law. Dr Gammage then moved on to discussing the effects of Brexit on human rights, arguing that at first sight it appears that there is no erosion of rights. Yet, the situation relating to Northern Ireland that is regulated by the 1998 Peace Agreement is not entirely clear. Further and more generally, the Charter of Fundamental Rights of the European Union will not apply in the UK anymore. This needs to be given proper consideration as a number of rights enshrined in the Charter are not protected elsewhere (eg in the Convention for the Protection of Human Rights and Fundamental Freedoms) and even though the government is committed to retaining EU law it should be borne in mind that such laws can be changed both by Ministers and Parliament and that devolved administrations might not be involved in such decisions. This will have considerable impact on economic rights but could, as Dr Gammage argued, be included in the withdrawal agreement. Moreover the right to equality does not exist as such in the UK as it is entirely based on EU law. Such a right, different from the prohibition of discrimination based on various factors, could be lost. As for the interrelationship between Brexit, trade and human rights Dr Gammage explained that changes in trade relations should be made with great care as a viable economy is of paramount importance. A further complication relates to accepting, even if reluctantly, trading standards in free trade agreements that might directly impact on the local population. For example, the issue of trade in agricultural products must be carefully thought through as the mass import of agricultural goods may lead to less employment which itself can bring salaries and wages down. Also the UK could be bound by trading standards that apply extra-territorially (eg EU animal welfare rules). Dr Gammage thus suggested it might be better to align UK standards on EU regulations for such matters. However, in the grand scheme, the UK will have to find funds to cover for the lost trade and subsidies to eg agriculture and such funds might in fact be divested from assistance to eg disabled and homeless persons. Dr Gammage concluded on the sad note that the UK will in the long term be vulnerable to internal and external troubles.

After the presentations questions from the floor focused on (1) the impact of Brexit on the 1998 Northern Ireland Peace Agreement, (2) the potential checks at the border between the EU and the UK, (3) the impact of Brexit on trade between the UK and South America as well as (3) the future shape of trade agreements between the UK and African States and the Commonwealth.

 

 

 

The Impact of Brexit on Integrity and Corruption: Local and Global Challenges, by Dr Lorenzo Pasculli

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This talk was organised by the Commercial Law Unit and the International Law and Human Rights Unit on behalf of CALR.

Dr Lorenzo Pasculli standing in front of an projector screen, students in the foreground.
Dr Lorenzo Pasculli

On 14 February 2018 Dr Lorenzo Pasculli, Senior Lecturer in Law at Kingston University London challenged the audience to look at Brexit through the prism of corruption. No doubt this was an insightful and out of the ordinary guest talk for those who suffer from Brexit fatigue.

Dr Pasculli started by explaining that since Brexit or anything similar has never happened before it is difficult to find a theoretical framework to reveal what the consequences of Brexit will be on corruption. That being said, Dr Pasculli stressed that in his opinion Brexit has and will have an impact on integrity at a variety of levels as well as anti-corruption laws and policies.

In relation to integrity, the impact of Brexit can be felt in three areas: political, financial and commercial as well as systemic social. Dr Pasculli explained that the impact of Brexit on political integrity can be analysed at both macro- (ie public bodies, corporations and the media) and micro-level (ie individuals working in the public service) on the one hand and from an internal (ie British politics) and external (eg foreign affairs as well as other States) perspective. This risk factors relating to political integrity are chiefly due to the multiple and complex interests which create division as well as confusion and so mistrust that is amplified by what Dr Pasculli calls, ‘the wrong choice of decision-making device’ which was the referendum. At the internal micro-level there has always beena solid tradition of political integrity even when there were conflicts between personal views and the views of the party. The risk here is that if individuals externalise their dissent they might be reprimanded or marginalised for doing this (as it happened in some recent case). This might lead to the repression of pluralism and dissent. At the internal macro-level, the UK which is often viewed as the beacon of the rule of law is performing very poorly as politicians with undermined integrity did not explain the complexity of the issues and certain lobbying and media stained the Leave campaign of misinformation. Dr Pasculli pointed out that the lack of regulation of the British press exacerbated the influence of lobbies on certain press. The dearth of effective sanctions facilitates partisan press and political misinformation. Further the lack of mechanisms for politicians to step back, apologise for and correct the effect of misinformation on the general public (eg £350 million for the NHS campaign) undermines political integrity. Overall this atmosphere has led to (1) a phenomenon of deresponsabilisation; (2) reliance on emotions rather than reason and information when law and politics should be based on rationality, reasonableness and evidence; (3) general deterioration of political integrity and standing. The consequences of Brexit on external politics (outside the UK) should not be underestimated too. Discussions were had on possible emulations in the form of Grexit and Exitaly but they did not materialise. Most importantly Brexit has strengthened the global trends of populism and nationalism that clearly undermine political integrity as voters are given information that is not built and/or supported by evidence. Brexit, in other words, nurture the global trend of irrationality. After Dr Pasculli argued that this erosion of political integrity leads to ‘legalised forms of corruption’ (eg press being lobbied and lack of regulation of the press) he called for a widening of the definition of corruption in line with the anti-corruption convention. He highlighted the revolving door appointments as an example of lawful practice and stressed that research shows a disconnection between what people believe is unlawful and the actual regulation of particular activities. Dr Pasculli explained we should seize Brexit as an opportunity to raise awareness about these problems as well as ensure a better responsabilisation of certain politicians. Both internal and external pressure can be used to persuade the UK to adopt necessary regulatory measures.

Dr Pasculli then moved on to examine the impact of Brexit on financial and commercial corruption. Dr Pasculli started by explaining that the UK government has clearly explained that the UK will leave the single market even though the EU market is crucial. The conditions imposed by the European Union to the UK in relation to market access might be viewed by the general public as unreasonable and unfair. Such a perception could lead to a violation of legal rules, for there is a tendency to the rationalisation of corrupt practices when the law is seen as useless and/or unfair. This inevitably creates a subculture that encourages corruption more generally. Furthermore, Dr Pasculli observed that as the UK is looking to negotiate trade agreements with non-EU States it must be wary of such business opportunities. First a number of such countries do not comply with anti-money laundering and anti-corruption regulations. Second, companies might have to use corruption in order to pursue their business activities in corrupt-ridden countries. Looking at the countries mentioned by the UK government as potential business partners it is clear that the UK is looking at doing business in places that are high on the corruption index of Transparency International. In other words, British companies are going to move the trade to an environment which is more corrupt. As Dr Pasculli stressed, there is a need to raise awareness about this potential corruption threat. Nonetheless it might be possible to view these business opportunities in a positive light and argue that British companies could become exporters of good practices, strengthening the rule of law and global governance in these countries and more particularly in the Commonwealth.

In relation to systemic social integrity Dr Pasculli noted that the UK government is supporting high-skilled migration only. This, he believed, is extremely short-sighted. Research shows that corruption causes emigration, particularly of high-skilled migrants looking for opportunities in other countries as they are unable to move on in their home country. This however does not necessarily mean that high skilled migrants are immune to corruption. On the contrary studies demonstrate that immigration from corrupt countries boosts corruption in destination countries. As a result, Dr Pasculli suggested that to avoid the spread of corruption in the UK thorough background checks at the port of entry need to be carried out.

Is the UK continuing to be a global example in relation to anti-corruption practices? Dr Pasculli began by asserting that the UK has often been used as a model for anti-money laundering and anti-corruption measures and policies. The possibility of deregulation once outside the European Union might be viewed as a threat to the excellent contemporary regulation. Whilst some scholars argue that Brexit is a distraction from the anti-corruption agenda, Dr Pasculli contended that this is not necessarily the case. In fact in the past year a variety of institutions (eg the International Anti-Corruption Coordination Centre, the Office for Professional Body Anti-Money Laundering Supervision) have been set up and strategies (eg anti-corruption strategy) and laws (Criminal Finances Act 2017, implementation of the fourth money-laundering directive) drafted and adopted.

Brexit will also have an impact on UK financial sanctions which could potentially lead to an increase in corruption and money-laundering practices. Dr Pasculli first observed that financial sanctions are imposed on individuals in relation to their access to financial assets and services and are imposed with a view to pursue specific foreign and national security policies. Then Dr Pasculli noted that at the moment such sanctions can be imposed by the United Nations Security Council, the European Union (often in implementation of UN Security Council resolutions) and the UK Office of Financial Sanctions. After Brexit there will be no need for the UK to comply with the EU sanctions regime anymore. Dr Pasculli underlined that the new Sanctions and Anti-Money Laundering Bill 2017-2019 endows the executive with large powers for a broad range of purposes (eg fighting measures that challenge the rule of law). Further, it is flanked by weak individual safeguards such as ex post judicial review and no jurisdiction of the Court of Justice of the European Union (which had in the Kadi case protected individuals’ human rights against the application of UN Security Council resolutions). Post-Brexit the UK will not be able to sit in EU meetings that relate to sanctions and as its strong voice on sanctions usually gathered support from other Member States it is argued that that without the UK taking part in such discussions divisions amongst EU member States might show more prominently. That being said if the UK imposes sanctions that are not aligned to other States it will feel the pressure of other States as well as companies that are trading in such States. This in turn might increase the potential for corruption.

LastL but not least Dr Pasculli stressed that as the UK will be drafting a new raft of laws it must be careful that such laws are not providing opportunities for corruption and crime. Criminogenic lawmaking is indeed a potential risk post-Brexit with new schemes and laws being designed and individuals as well as companies finding ways to abuse or misuse such schemes (eg welfare benefit, taxes/fees/obligations, access to goods and services). Such potential for corruption is heightened if broad regulatory powers are given to authorities.

Looking forward Dr Pasculli shared with the audience his recommendations: (1) there must be some form of responsabilisation of politicians and companies, (2) education and ethicisation are key to maintaining integrity in public affairs, (3) ‘corruption proofing’ of legislation must become an established practice, (4) external controls must be increased.

 

Securing the Future of the World Trade Organisation

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Dr Emily Reid, Associate Professor in EU Law, Southampton Law School at the University of Southampton delivers a guest speech.

In November 2017 UWE’s International Law and Human Rights Unit on behalf of the Centre of Applied Legal Research invited Professor Reid to speak at the Bristol Business School on the future of the WTO.

For more than the last decade the WTO and ‘globalisation’ has been the subject of sporadic public protest, exemplified by events in Seattle in 1999.  More recently, the last decade has seen in Europe a growing number of popular demonstrations against a range of trade and investment treaties such as the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU and the Transatlantic Trade and Investment Partnership (TTIP) between the US and the EU. Frequently disquiet has focussed upon a perceived conflict between economic liberalisation or indeed globalisation itself and social or environmental values. Reference to these protests and public sentiment formed the backdrop to Professor Emily Reid’s guest talk at UWE on 1 November 2017. Prof Reid, an expert in international economic law and sustainable development, examined how the World Trade Organisation is defending and can defend such non-economic interests whilst still holding a liberal view of trade relations. Her passion for the subject is drawn from her previous work on how the European Union has managed to accommodate the protection of human rights and environment with economic liberalisation, and extrapolating from this the lessons which the global community might learn from that.  (see E Reid, Balancing Human Rights, Environmental Protection and International Trade: Lessons from the EU Experience (Hart 2015))

Prof Reid began by noting the growing diversity of legal orders, pursuing a range of objectives, both economic and non-economic, highlighting that the interrelationship between social, environmental and trade elements is complex and evolving. Whilst these three elements can clash in particular instances, they are not inherently in conflict and in the longer term they are, indeed, mutually dependent, as is evident in the concept of sustainable development.

The broader question relates to the legitimacy of this economic organisation inasmuch as its policies and decisions have been the subject of criticism by some for failing to take sufficient account of human rights and environmental concerns. The fragmentation of international law with its variety of actors and self-contained regimes further complicates the task: who are the regulatory decision-makers? Wherefrom does their legitimacy stem? How are they accountable and to whom? These pressing concerns are no doubt difficult challenges for States operating in a new legal order, in which the role of the state is radically different to that under the ‘Westphalian’ order in which the WTO was created. How can the State in a Westphalian sense of the term deal with this multiplicity of actors?  How can (local) democratic accountability be secured?

In addition, the international legal context has considerably evolved in the past decades as the WTO has had to engage with the emergence of new popular concerns, such as environmental protection, and their associated legal regimes. Indeed when the General Agreement on Tariffs and Trade (GATT) was negotiated, the definition of ‘conservation of natural resources’ as an exception to the trade rules was understood in terms of mineral resources. The WTO has since, however, acknowledged that a modern understanding of the term was needed. Such recognition is crucial to the ongoing relevance and legitimacy of WTO law.

As global regulation is evolving and increasing, political and democratic demands are growing too. Contemporary political events (eg the vote for withdrawal of the UK from the European Union, the election of President Trump, the support for Le Pen in the French presidential elections) reflect a growing popular nationalism, and rejection of elements of globalisation: does this mark a transformative shift?

Prof Reid pointed out that the legal order that regulates economic relations is not only legally binding but also highly sophisticated in that it provides for binding dispute resolution.  The pursuit of trade liberalisation requires a reduction of barriers to trade, yet national environmental regulation has the capacity to impede the application of WTO law, constituting as it can, a barrier to trade.

Thus Professor Reid identified the challenge for the WTO as being two fold – first, there is a challenge of legitimacy, and second, there is a need to re-establish and strengthen the balance between global economic integration and domestic regulatory autonomy.  These carry implications for both the fact that the WTO addresses the balance between economic and non-economic interests and the manner in which it does so.

On the first, Prof Reid notes that it is significant that it is the WTO which is, by virtue of its dispute settlement mechanism, the sole adjudicator of the balance to be drawn between application of the WTO rules, and their relationship with national regulation.  That the WTO, an economic organisation, is the organisation which determines the balance between trade liberalisation and national environmental regulation raises a number of legitimacy, and of accountability related questions.  Prof Reid noted that there has been significant criticism regarding decisions made by economic bodies generally and the WTO more specifically, however she went on to note that on further investigation, some of this criticism is unfounded.  The WTO Dispute Settlement Body has an obligation to apply the WTO rules, it has no jurisdiction to go beyond this, and would face questions of legitimacy were it to do so.

Prof Reid then turned her attention to examining how the WTO solves this conflict between on the one hand the rules of the WTO and its covered agreements, and on the other hand national environmental regulation. Has the WTO the competence to do so? If so, how has it taken on the challenge? After all, it is important that the WTO approaches the subject in such a manner that it meets the test of legitimacy as it otherwise opens itself up to further challenges.

In this light, Prof Reid argued that the WTO can indeed meet the challenge of legitimacy provided it (1) reinforces the non-discrimination paradigm (e national treatment principle and most-favoured nation clause) and (2) re-examines the way in which it addresses the balance between economic and non-economic interests.

Prof Reid explained that initially the underlying objective of the WTO was to secure welfare gain for everyone. Later, imbued by a neo-liberal account, free trade became a goal in itself rather than a tool to reach other objectives. Illustrative of this development is Article 2.2 of the TBT agreement that provides that national regulatory measures must not only be non-discriminatory but also necessary. This is no doubt a manifestation of the neo-liberal thinking as both discriminatory and non-discriminatory regulatory measures must be justified. As a result the State is less free because it must prove that the measures (eg. emission standards) are necessary as part of the test and this, of course, opens the door to greater and more in-depth reviews of national measures. Prof Reid thus argued that the non-discrimination paradigm must be reinforced.

Prof Reid then scrutinised the way the WTO dispute settlement mechanism can potentially encroach on how non-economic issues are viewed and addressed in international economic law. Whilst it might be contended that States had agreed to such legally binding mechanism on a voluntary basis they nonetheless did not expect such a curtailment of their freedom to act. This no doubt affects the legitimacy of the mechanism all the more as an increasing number of individuals deem the protection of the environment to be of utmost importance and feel that the WTO is impinging on such an important matter. That being said, Prof Reid stressed that the WTO dispute settlement mechanism has so far, notably due to its restricted mandate, adopted a conciliatory approach. The mechanism, when examining general exceptions to the non-discrimination principle, has adopted a broad interpretation of the terms so as to facilitate the use of these clauses to cover environmental issues. After carefully examining the test enshrined in Article XX GATT that relates to general exceptions, Prof Reid concluded that the mechanism does not question the level of protection offered by such measures, but whether the measure is the least restrictive in terms of trade. This enables the mechanism to keep an objective evaluation of the measure even though it does claim that it is engaging in a ‘weighing and balancing’ exercise. As a result of the mechanism refusing to examine the state’s level of protection (which is in fact consistent with the trade liberalisation paradigm) it avoids the legitimacy question.

In conclusion Prof Reid reiterated that the evolution of the international legal order poses a significant challenge to the WTO. She however maintained that the WTO has the capacity to address such challenges: it must reinforce the non-discrimination paradigm and continue to resist the movement towards a subjective evaluation of State measures.

In the discussion that followed, participants asked questions about eg. the consistency of the case-law of the dispute settlement mechanism, the interrelationship between WTO rules and regional agreements, how non-government organisations can influence WTO decisions, and the definition and application of the concept of ‘human health’ as found in Article XX GATT.

 

 

January 31 – Cryptocurrency Tax D-day

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Dr Clare Jones,  Associate Professor in Law, examines tax implications of digital currencies

For those of us that complete a tax return for HM Revenue and Customs, the 31st January comes around very quickly each year. Previously those who have invested in digital currencies may not have considered declaring these investments. However, with the rise in investments in digital currencies during the last year and with some people making trading in cryptocurrencies their full-time job, then the 31st of January should now be relevant.[1] Although earnings via digital currencies within this current tax year 2017-2018 may not be pertinent, the next financial year will surely see a rise in revenue for the Government due to the activities over the last year.[2]

Digital currencies have the reputation of being used to facilitate crime whether it is money laundering or fraud, yet tax evasion is a real and present threat and digital currency investors often ignore or are unaware of the prospect of paying tax on earnings.

In 2014 the Government issued a Brief outlining the tax implications for Bitcoin and other Cryptocurrencies.[3] HM Revenue and Customs states that: “Cryptocurrencies have a unique identity and cannot therefore be directly compared to any other form of investment activity or payment mechanism”.[4] Having said that, they are not exempt and must comply with EU wide tax VAT rules. Revenue and Customs are quick to point out that guidance given in the briefing does not provide a regulatory stance over cryptocurrencies.  The tax treatment as outlined in the briefing paper is as follows:

·         income received from Bitcoin mining activities will generally be outside the scope of VAT on the basis that the activity does not constitute an economic activity for VAT purposes because there is an insufficient link between any services provided and any consideration received;

·         income received by miners for other activities, such as for the provision of services in connection with the verification of specific transactions for which specific charges are made, will be exempt from VAT under Article 135(1)(d) of the EU VAT Directive as falling within the definition of ‘transactions, including negotiation, concerning deposit and current accounts, payments, transfers, debts, cheques and other negotiable instruments’;

·         when Bitcoin is exchanged for Sterling or for foreign currencies, such as Euros or Dollars, no VAT will be due on the value of the Bitcoins themselves, and,

·         charges (in whatever form) made over and above the value of the Bitcoin for arranging or carrying out any transactions in Bitcoin will be exempt from VAT under Article 135(1)(d) as outlined at 2 above.[5]

In terms of Corporation Tax, Inheritance Tax and Capital Gains Tax,  will be judged on a case by case basis and will be dependent on relevant legislation and case law to determine the correct tax liability. Any business that accepts Bitcoins for services or goods, there is no change to revenue or collected or tax paid.

Although cryptocurrencies are proving to be an enigma within the legal and tax industries, it is clear that the UK Government along with other international governments are keen to look at piecing together rules and regulations to bring cryptocurrencies under the umbrella of governance. The 31st of January, may next year, be more of a bug-bear to digital currencies investors than ever before.

[1] BBC News. Bitcoin – the revenue comes calling. 31 January 2018. http://www.bbc.co.uk/news/technology-42872610 accessed 31 January 2018.
[2] Ibid.
[3] HM Government. Revenue and Customs Brief 9 (2014): Bitcoin and other Cryptocurrencies. https://www.gov.uk/government/publications/revenue-and-customs-brief-9-2014-bitcoin-and-other-cryptocurrencies  Accessed 31 January 2018.
[4] Ibid
[5] Supra n. 3.