The provisions in section 12 concern the legislative competence of the devolved legislatures. They provide that the devolved legislatures cannot pass primary legislation modifying retained EU law in such areas as are specified by UK Ministers in regulations (unless that modification would, immediately before exit day have been within the legislative competence of the devolved legislature in question).
Section 12(4) is the relevant provision for the purposes of the National Assembly for Wales’s legislative competence. It replaces part of the National Assembly’s legislative competence test in section 108A(2)(e) of GOWA (the requirement to legislate compatibly with EU law) with a new restriction in section 109A of GOWA. Section 109A(1) is the power under which a Minister of the Crown may make ‘freezing regulations’ (also referred to as ‘section 12 regulations’) which place restrictions on the National Assembly’s legislative competence. That provision came into force for the purposes of making the regulations upon the Act receiving Royal Assent on the 26th June 2018. However, it is expected that any such restrictions placed on competence by the freezing regulations will not take effect until a later date, which would not be before exit day.
The freezing regulations can only be made following approval by both Houses of Parliament, and in accordance with a new statutory process involving the devolved legislatures.
There is a sunset clause which has the effect that freezing regulations can only be made within two years of exit day.
Part 1 of Schedule 3 makes equivalent changes in respect of devolved executive competence. It replaces the existing restrictions on devolved administrations making subordinate legislation or otherwise acting incompatibly with EU law. In their place, it provides that devolved ministers (or, in Northern Ireland, a minister or NI department) have no power to make, confirm or approve any subordinate legislation that modifies retained EU law in areas specified by UK Ministers in freezing regulations.
The Schedule 3 restriction on modifying retained EU law does not apply to the exercise of the powers conferred on the devolved administrations under Schedule 2 and Schedule 4 to the Act. This means that Welsh Ministers powers to make corrections to “deficiencies” in retained EU law (above) are not affected by the making of freezing regulations.
The first Cabinet Office report on The European Union (Withdrawal) Act and Common Frameworks details the progress made in the first reporting period (26 June to 25 September 2018) as required under Schedule 3 to the European Union (Withdrawal) Act 2018 and states:
“On the basis of the significant joint progress on future frameworks, and the continued collaboration to ensure the statute book is ready for exit day, the UK Government has concluded that it does not need to bring forward any section 12 regulations at this juncture.”
The same conclusion was recorded in the report for the second reporting period (26 September to 25 December 2018).