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Ewan Sutherland: Continuity of Laws, Institutions and Regulatory Certainty

In June 2014, the Scottish Government published its draft Scottish Independence Bill, on which it held a consultation. Article 34 of the Bill provides for continuity of laws:

1)   The laws that are in effect in Scotland immediately before Independence Day are to continue to have effect on and after Independence Day unless and until they are—

a.       repealed or modified by Act of the Scottish Parliament or subordinate legislation,


b.      otherwise modified by operation of law.

2)  That is subject to the constitution.

3)  The laws referred to include any law, whether contained in a rule of law, an Act of the Scottish Parliament, an Act of the Parliament of the United Kingdom, an Act of the Parliaments of Scotland passed before or in 1707, subordinate legislation, a prerogative instrument or any other instrument or document having the effect of law.

In principle the proposal to achieve continuity of laws makes considerable sense. For example, it would be extremely unfortunate not to continue the provisions of the Bribery Act 2010 or the competition law provisions of, inter alia, the Enterprise Act 2002 and the Enterprise and Regulatory Reform Act 2013. This legislation is also required by obligations made by the United Kingdom under international treaties. However, some acts in order to be effective require associated institutions, which are often created by the legislation or by associated secondary legislation.

A general policy principle is regulatory certainty, in order that organisations and individuals subject to regulation can make plans in the short to medium term. Where possible uncertainty should be avoided.

Royal charters

One of the classes of legal instruments mentioned in the explanatory text is the existing set of Royal Charters.

For example, the University of Glasgow has a Royal Charter which would continue to authorise it award degrees. However, the Royal Charter of the Open University is a more complex matter, suggesting the need for a split, creating a new Scottish Royal Charter and another for the United Kingdom.  The same is true of the research councils (e.g., the Economic and Social Research Council) issued pursuant to the Science and Technology Act 1965.

There is a string of professional bodies which have Royal Charters, for example, the Royal College of General Practitioners (RCGP), which operate across the existing United Kingdom. Again the issue arises of whether these charters and organisations would be split.

It might reasonably be argued that Royal Charters are too Jacobean or, even, Anglo-Norman and ought to be replaced by more modern legal instruments.


The following are examples of institutions required to implement United Kingdom legislation:

The intention of the Independence Bill is quite unclear on the issue of institutions. It would be absurd to conjure a large number of institutions into existence at the instant of independence, since they would require considerable preparation and planning: the renting of offices, the appointment of staff and so on. Equally, the legislation would be largely ineffective without such bodies.

The National Lottery Act 2006 presents two problems, the selling of tickets and consequent winning of prizes, and the payments toward good causes. Is the intention to create a new Scottish Lottery under a new Scottish Gambling Commission or to allow the existing United Kingdom Lottery to continue in Scotland? For the latter, the challenge would be to ensure the continued distribution of monies to good causes in Scotland from what would have become a foreign lottery with statutory provisions about its potential beneficiaries.

Regulation of communications

Broadcasting and telecommunications require substantial investments that are effectively sunk costs, so that governments usually endeavour to ensure “regulatory certainty” and the avoidance of surprises or sudden changes in regulation.

The intention to provide continuity of laws conflicts directly with the stated intentions of the Scottish Government in the regulation of markets, in particular of telecommunications and broadcasting. In Scotland’s Future – Your Guide to an Independent Scotland it is made clear that OFCOM is to be broken up and its functions distributed to a number of new bodies. The changes are of so great an order that a fresh transposition of the applicable European Union directives seems unavoidable. Whereas, continuity of laws would seem to create Scottish instances of the existing OFCOM and its Content Board. For all the regulated firms it would be important not only to know what the future law would be, but also the nature of the regulatory system and ideally the senior officials. At present that is impossible.


In order to be effective the “continuity of laws” needs to be clarified. There are estimates of about 200 bodies, but seemingly no definitive list, of the various ministries, authorities and agencies used to implement existing United Kingdom laws and subordinate legislation. It seems unlikely that many of the existing bodies would be able to operate in a foreign country, as Scotland would be, unless specific legal and financial arrangements were put in place. Doubtless some of these agencies could be created after independence, but core institutions such as the GMC, OFCOM, CMA, CAT and the like would need immediate preparatory work.

Similarly, the future of United Kingdom licences and Royal charters needs clarification, whether they continue to include Scotland or whether new instances of the licences and charters are to be created. This information is essential for the planning of the various holders of the charters and licences.

To ensure certainty for firms and customers in regulated industries, such as broadcasting, electricity and telecommunications, the ambiguities in the present proposals need to be resolved.

Ewan Sutherland is a Research Associate at the University of Witwatersrand Link Centre, South Africa

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