Written Supplement; Historical Analysis of the Geographic and Institutional Implications to Economic Development

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Development

Varying patterns of development illuminate global inequalities. Measured by the welfare of citizens, ‘development’ is empirically represented by the standard of living in a given nation-state. Originating in 16th century France, development was used to describe the développer, the “unfolding” of centralized cities and expansion of state power. Referring to an increasing spatial-political relationship, development is rooted in understanding welfare as the unfolding of institutional structure within a geographically defined territory. Empirical definition of development is contentious, because it suggests that standards of living are a measurable construct. Applied through a quantitative lens, economic development analyzes the standard of living between national economies. Based in economic growth, economic development suggests the application of resources towards the welfare of citizens- the ‘welfare state’. Through a historical analysis of the ‘welfare state’, economic development is framed as dependent upon empirical geographical and institutional advantages.

What is a Nation?

Europe’s 17th-century rise of nation-states birthed the concept of economic development. French développer of cities gained signification; economic prosperity became institutionalized under the “nation-state”. As a recognized sovereign territory, the nation-state economically integrated cities in to a mercantilist capital accumulation regime. Since the 16th century, the economic doctrine of mercantilism drove the imperial practices of western European powers towards the creation of nation-states. Focus on capital accumulation towards a strengthened central military can be assumed as the first consideration of economic growth. Differing from economic development, economic growth is the measure of domestic production, without heeding to increase in the standards of living. This important difference between ‘growth’ and ‘development’ is illuminated in the mercantilist ideology; the extraction of resources towards the benefit of the central state was not dispersed through social programs, but rather towards the infinite growth of the state. These protectionist policies played the role of early political economy, as mercantilism was an effective tool in strengthening the centralized state. Important to economic development, the birth of the nation-state created a founding institutional centralization of the economy. Despite territorial convergences in later decades, the role of geographic recognition was to create a territorial commonality under a centralized economic institution.

Specific to the 250 years of Mercantilist theory is the concept of extraction. Framed by authors James Robinson and Daron Accemoglu, strong mercantilist nations of Great Britain, France and Spain practiced extractionary politics through colonization. Extraction describes the mercantilist theory of economic growth, described by Acemoglu and Robinson as operating a ‘zero-sum game’, wherein benefit to the state was at a loss to another. Extraction becomes important to economic development of colonized nations, because, unlike the centralized institutions within territorially defined nation-states, colonized nations experienced a decentralized organization of labor, effectively destroying possibilities for a welfare state.[1]

 

The Role of Inclusive Institutions

Although the idea of economic development was unconceivable in the Mercantilist period, the birth of the centralized nation-state set the institutional and geographic parameters for economic growth, which is essential to economic development. Moreover, Mercantilist economics engaged Western European nations in the forging of institutions through warfare, effectively destabilizing governments and giving rise to labor and unionist movements. Authors Acemoglu and Robinson address this phenomenon as the process of ‘creative destruction’, whereby established power relations are broken and give rise to innovation. Established trade relations, such as the Hudson’s Bay Company, supplemented the changing tide of institutional relationships with the rising economic nationalism. International trade became a vital source of economic growth, while the role of institutions shifted from centralized to representative.

Acemoglu and Robinson organize their book Why Nations Fail around the supremacy of institutional organization in economic development. The premise of this is derived from the Machiavellian persona of Mercantilist nations, whose collapse preceded inclusive institutions, and a ‘virtuous circle’ of economic development. Suggesting that Great Britain’s Glorious Revolution of 1688 was the first step of an institution towards inclusivity, WNF aligns Great Britain’s success in the industrial revolution with redistributed taxation. Beginning with the 1572 Poor Law, British taxation was given a welfare-like status. Unlike welfare, the Poor Law was parochial and redistributed in the form of workhouse care. Tradition of socially-minded taxation allowances were perpetuated through the settlement of Ireland, and transitioned in to lower taxation for plantation land ownership. This increase in land ownership also increased opportunity for profit, growing the middle class. On the other coin, extractive French taxation maintained allowances only for the noble élite, causing disproportionate growth in wealth. Mercantilist economics allowed élite French to hold almost 90% of wealth, and the French could not sustain their wars leading up to the French Revolution from merely taxing 10% of the economy. The burgeoning inclusivity of Great Britain’s institution of taxation exemplifies the ‘virtuous circle’ role that inclusivity has on economic development. The French institution of extractive taxation caused a ‘vicious circle’, resulting in collapse of public finance. Economic nationalism plagued the Western European nations, particularly France, as military spending became unsustainable. The Bourbon Monarchy came to its knees in the face of public upheaval after the dismissal of a land tax proposal in 1776. French élite chose to act in self-interest and maintain extractive taxation, instead of have their lands taxed. Power in the hands of a few resulted in the upheaval by many.

‘Creative Destruction’ of the French Revolution’s power vacuum established governance by multiple ruling classes. Most poignantly, inclusion of the Tiers État, the third class society members, asserted institutional control by the hands of merchants and laborers. Stressing working class issues and trade priorities, the National Constituent Assembly and successive Legislative Assembly involved conflicting interests of the élite and the Tiers État, resulting in the highly symbolic overthrow of the French aristocracy in favor of a Republic. This highly influential succession of institutional development played a significant role in French public policy, under which solidarity was introduced to French governance. Taking the form of a welfare precursor, French solidarity measures were not direct redistribution of government funding to the lower classes, but rather the levying of land tax and restriction of agricultural tax. Allowing the agricultural sector to flourish, while collecting tax from the élite, the French middle class expanded and pushed towards the industrial revolution.

Inclusive taxation institutions grew the middle class in both Mercantilist nation-states of France and Great Britain. In both cases, this allowed investment of both capital and labor to flow from the agrarian sector to the industrial sector, inspiring the industrial revolution. France and Great Britain developed from Mercantilist nation-states in to nationalist production economies, due to changes in the role of institutions as taxation policy.

The Role of Economic Geography

Mobilization of workers was intrinsic to the movement from agrarian society to industrial society. Political geography of France and Great Britain was changing, as demand for labor in to industrial centers encouraged movement from outlying sectors. The role of this geographical transition to economic growth is clear; new industry heightened national production and demanded labor, and the average wage rose, increasing supply of labor. This spatial adjustment of population did increase production and average wage, but had an adverse affect on standards of living. Assumed by economic geographer Paul Krugman to encounter a ‘rent seeking’ ideology, which is unsustainable for economic development, the industrial revolution in Great Britain and France encountered a changing population spatiality, and thereby, an unequal distribution of wages.

First, in discussing the role of geography to Great Britain and France’s economic development, infrastructural developments must be highlighted. Transportation of workers to the industrial centers- the process of urbanization- greatly exaggerated the core-periphery differentiation within nation-states. Still at the forefront of economic growth, and therefore, economic development, France and Great Britain had a cyclical relationship of wanting to attract laborers to the industry, therefore increasing transportation expenditure, and laborers wanting to make higher wages in the industrial sector, therefore increasing transportation innovation (Krugman, 1991). Urbanization effectively created an economy of scale for laborers to participate in, which, like the introduction of small industry to economies of scale, disvalued the labor.

Krugman suggests that under the marginal production theory of income distribution the ‘rental rate’ of a given industry must equal the production value of laborers to maximize profit. So, as industry expands, demand for labor must increase with wages relative to the costs of production. This ‘rent seeking’ ideology is at issue, because in the case of a large supply of labor moving from agrarian to industrial society seeking employment, profit can be maximized by not distributing wages at the ‘rental rate’ equilibrium. Wage inequality is not an institution, because it was not a policy, but is instead the effect of geography by way of population and labor supply. Wage inequality begets the institution of solidarity movements after the transfer of knowledge from the German welfare state.

Economic Growth to Economic Development

Transfer of knowledge between economies is an effect of trade. The impact of the industrial revolution was the increase in demand and supply of labor and goods, because of the heightened middle-class as discussed through the role of institutions. Trade theory, developed significantly after the industrial revolution, explains the nature of trade and its benefit to industrialized economies. Trade theory is important to the role of geography and the role of institutions, as it conceptualizes reasoning for and effect of actualized spatial-political relationships. Trade theory also further explains the intrinsic nature of Mercantilist desire for economic growth, to the beginning of economic development.

Assuming that all actors will act rationally, economic theory always suggests profit-maximizing behavior. Conditioned by Keynesian economics, the gains from trade maximize supply and demand, increasing the opportunity for profit through comparative advantages. The Hecksher-Ohlin model (1933) suggested that even in a situation of absolute advantage, gains from trade were possible due to relative advantages of goods and labor. Relative advantage highlights the disproportionate production possibilities among actors, but does not recognize the disproportionate competition between them. Competition occurs because there is profit-maximizing opportunity in increasing supply, in order to meet the larger demand of trade. With demand increasing through trade, and supply increasing thusly, industries involved in trade will develop increasingly, given that the factors of endowment are also increasing. The Linder hypothesis (1961) shows that competition is essentially dependent on production possibilities, which are dictated by factors of endowment, such as capital, labor, resources and technology. These ‘externalities’ affect growth of industry, creating imperfect competition between actors.

According to Linder, imperfect competition limits the possibilities of trade, because actors with dissimilar factors of endowment are unable to inspire competition in industry. By operating under the assumption that gains from trade are necessary for economic growth, but actors are endowed with different factors, it is reasonable to assume that there are supplementary motivations for trade. The Gravity Model suggests that relative size of economies (their factors of endowment) and relative distance of trade are the contingencies of benefit (Tinbergen, 1962.) Distance of trade is meant to limit transportation costs, similarly to Krugman’s assumption of urbanization as cost saving. Geography’s role in economic growth is shown here- neighboring nations tend to trade with each other.

Tendency to trade with relatively close countries will be analyzed specifically by the parameters of the Gravity Model, to emphasize the process from economic growth to economic development, rather than the socio-political relationships between countries. Although significantly more able to trade due to historical relationships of language and culture, neighboring countries tend to establish trade relations at an institutional level- with underpinnings of geographic spatiality. Coming to a case-in-point, trade relations between Germany and France perfectly represent this Gravity Model, because of their relative distance. Krugman suggests that the geographical relationship supersedes the necessity for relative factors of endowment, and the Linder hypothesis speculates that the syncing of German transportation and industry to the levels of France and French increase in levels of welfare to Germany represents this relationship.

German and French difference in factors of endowment in the industrial revolution must be analyzed first through the difference in institutional arrangement. Present-day Germany did not exist, in that it had not undergone the same pattern of nation-state building as France, due to maintenance of parochial taxation in Germanic territories (Nietzsche, 1885). The reasoning for this 1881 federalization of Germany is speculated as an effect of rising German nationalism, in response to French nationalism and militarization of German territories (Said, 1978), which would correspond to geographic role in synchronization of factors of endowment. Also correspondent, is the upswing in German transportation efforts nearly a century after the industrial revolution began in France and Great Britain. Increasing German nationalism after the Napoleonic Wars threatened German territory began the process of transportation building, especially near the French border and along the Rhein. Germany’s geographic growth in facilitated trade, and the coming of the industrial revolution, under the guise of national protection in warfare.

Learning from France’s regularity in working class institutional change, the development of the German state was based in Otto von Bismarck’s welfare programs. Germany offered the first economic development plan, by learning from the failure of extractive economic growth policies of the French. France, likewise, modeled it’s own welfare program after that of the Germans; policy making in an effort to stabilize the French institutions necessitated working class benefits, because of the severe wage inequality issue due to labor demand and supply. This institutional learning curve is suggested by the Linder hypothesis, because of Germany’s geographical relativity to France. Dialectic of German and French nationalism would soon be overshadowed by the increasing tension over remaining variances in factors of endowment.

Geographic development of infrastructure and institutional development of welfare in the German federation lead to quick expansion in factors of endowment. Coupled with the German access to warfare and industry resources of iron and steel, the French became defensive over the German’s economic development. Political tensions rose and resulted in World Wars I and II, which destroyed both French and German economic development up to that point. Despite the remaining principles in the benefit of a welfare state, when economic growth is depleted like it was due to warfare expenditure, economic development is impossible. Measured empirically by gross domestic product (GDP) per capita, ‘economic development’ is a country-based analysis of quality of life (Krugman, 2010). Measuring economic development by GDP per capita aligns all given factors of endowment with the country’s welfare. Maintenance of the welfare state is considered “economic development” because of the definition of welfare within the industrialized Western European countries. After WWII, the concept of foreign aid became related to economic development, as the welfare of Europe gained assistance from the United States’s Marshall Plan for European Recovery.

 

International Institutions and Economic Development

Politics of development assistance between the United States and Europe did not rest in pleasant diplomatic relations, seeing as world warfare had just cost both sides great deals of money and citizens. Rather, the United States’ interest in European economic development was towards the end of reconstructing the benefit of trade. As the most developed economy next to the United States’, Europeans had a history in purchasing power for traded goods, based on the Gravity Model’s suggestion of relative factors of endowment in industry. Geographical and institutional significance of foreign aid as a means of economic development lies in the globalization of economic growth, and the regionalization of economic development.

Institutionally, the Marshal Plan was significant in it’s ability to suggest peace negotiations among European nations. Instigating the first supranational free trade and common monetary system, the European Recovery Program recognized the tensions between trade barriers, and disregarded the geographically disjointed Europe. The European Union’s force as both an intergovernmental and supranational regime is unique in its configuration, and shares historical commonalities. The successful binding of national economies is fluid in nature, allowing for moderation and stabilization when necessary. With the recent Euro Crisis, this economic unity is threatened by the vacuum of power towards a higher authority, the European Central Bank. Economic development, the process towards increasing welfare, has become a supranational institution, threatening the sovereignty of nations involved. Geographically transcendent, the European Union still maintains tensions between institutional roles of intergovernmental actors.

Shown by the activity of the Development Assistance Committee, international aid is disproportionately decided upon by the 55 wealthiest nations in the world (Ragnar, 1961). The implications of this disproportionate aid include economic development dependence, resulting from the unstable institutions began during the extractionary period of colonization (WNF). Recent global politics suggest that the effect of development assistance created a tertiary extraction regime, whereby trade benefits only the country with greater factors of endowment. Trade between countries with varying factors of endowment can obviously result in tension and warfare, but if the one country is institutionally and geographically disadvantaged, the Linder model fails in applying the logic that it can essentially “scale up” to the factors of endowment of its larger trading partners. Subsumption of smaller economic industry in to economies of scale is represented through trade agreements like NAFTA, suggesting that despite the relativity in distance, the disproportionate factors of endowment negate efficient trade models. Specifically NAFTA represents this issue; the United States, although attempting to boost economic growth of Mexico towards the benefit of its agricultural relative advantage, effectively destroyed welfare of it’s farmers. The cyclical relationship between economic growth and economic development is realized by the downturn in economic growth due to lack of farming development. Farmers, dependent on United State’s investment, are economically unsustainable and suffer severe weaknesses thereby.

Implications of the institution of foreign investment and aid resonate in dependency theory. Unlike the Marshal Plan investment in Europe, which aided the re-growth of economically competent countries, the introduction of small economies with relatively little economic history, to large economies with significant economic competence assumes a sort of dominance of “development” (Ragnar, 1961). Derived from the French concept of the unfolding of political-spatial relationships, is development aid a mechanism of instituting foreign policy? Benefits derived from trade with developed countries are empirically visible in the increase of competition, and the significance of industrial growth to economic development. The role of institutional policy on economic development can be assumed as positive, in it’s responsive nature towards inclusive demands. The role of geography problematizes institutional benefit, because it suggests that a necessary institutional cohesion between geographically different nations, despite their different factors of endowment. Institutional cohesion, as seen on the supranational level of regional free trade agreements NAFTA and the EU, must respect the sovereignty of the country’s policy creation. If policy makers have little experience with economic development and no history in the welfare state, like NAFTA, they can fall in to a ‘vicious circle’ of economic dependence.

Works Cited

Acemoglu, Daron, and James A. Robinson. Why Nations Fail: The Origins of Power, Prosperity, and Poverty. New York: Crown, 2012. Print.

Krugman, Paul R., and Maurice Obstfeld. Internationale Wirtschaft: Theorie Und Politik Der Außenwirtschaft. München [u.a.: Pearson Studium, 2010. Print.

Krugman, Paul R. Cities in Space: Three Simple Models. Cambridge, MA: National Bureau of Economic Research, 1991. Print.

Nietzsche, Friedrich Wilhelm. Thus Spoke Zarathustra. New York: Modern Library, 1995. Print.

Nurkse, Ragnar (1961). Problems of Capital Formation in Underdeveloped Countries. NY: Oxford University Press.

Tinbergen, Jan. Mathematical Models of Economic Growth. New York: McGraw-Hill, 1962. Print.


[1] This phenomenon of geographic and institutional implications in economic development will be discussed further in relation to foreign aid and economic development.

The United Kingdom’s Acceptance of the Doctrine of Supremacy; Parliamentary Sovereignty in Question

The United Kingdom’s Acceptance of the Doctrine of Supremacy;

Parliamentary Sovereignty in Question

Queeny

Abstract

 

The European Court of Justice maintains a guiding principle of Supremacy. Accepted in both monist and dualist governance structures throughout the European Union, the Doctrine of Supremacy is directly effective in each Member State. In this paper, I will focus on the dualist acceptance of the Doctrine of Supremacy within the British Parliament. Through emphasizing the tradition of British Parliamentary Sovereignty as operating in a duality with the Doctrine of Supremacy, I will frame the ensuing contention within British legislation. By depicting the recognition of the Doctrine of Supremacy as the first step to dualism, I will posit that interpretation of EU Law as the main condition of contention. Through analyzing interpretation of EU law through the scope of it’s judicial application, I will establish that dualism exists due to continued British Parliamentary Sovereignty. I will then critically analyze the system of dualism in its theoretical relationship to the concept of a European Grundnorm, and its legislative feasibility for continued British Parliamentary Sovereignty.

 

Introduction

Accession of the United Kingdom to the European Union under the European Communities Act of 1972 subordinated British legislation, by making European legislation “enforced, allowed and followed.”[1] The ECA negotiated supranational power to the European Court of Justice through ratification of the British Parliament[2]. By accepting the ECJ as a regulatory body[3], the ECA made traditional British Parliamentary Sovereignty problematic, by establishing Union law as secondary legislation[4] on any “legal proceedings… to the effect of the [Community] Treaties.”[5] Given section 2(2) of the ECA, wherein the United Kingdom courts must recognize, interpret and apply the European Union Treaties within national courts, how has traditional British Parliamentary Sovereignty accepted the “new legal order”[6] of the EU’s Supremacy Doctrine?

Without a codified constitution, the UK allows Parliamentary Sovereignty in all legal matters[7]. Ultimate legal power of the UK Parliament is at odds with supremacy of EU law, because of the primacy they both imply. Parliamentary Sovereignty necessitated Parliament’s ratification the ECA, making the powers of the EU’s Doctrine of Supremacy contingent upon Parliamentary legislation. Therefore, Parliamentary Sovereignty is reified as “continued sovereignty”[8] under the ECA, due to the power for Parliament to withdraw from the Union at will[9]. Foundation for continued sovereignty of British Parliament lies in the recognition, interpretation and application of the duality of power implied in the UK relationship with the EU. The UK operates under a system of dualist governance, respecting both UK and EU powers, in order to solve the problem of British acceptance of the EU’s Supremacy Doctrine.

Dualist Governance and Acceptance of the Supremacy Doctrine

A system of dualism involves a two-stage process of legislation. In the context of EU and UK relations, the dualism rests between the Doctrine of Supremacy, which allows UK citizens to enjoy EU rights, and the UK Parliamentary Sovereignty, which allows the UK to remain in power of all legislation. These two competing hierarchies maintain a dual relationship in respect to legislation, in that they both have binding power. Sectoral convergence to Union Treaty articles establishes a growing range of legislature to which the Doctrine of Supremacy applies. In this fluidity of Union regionalization, the UK has confirmed Parliamentary Sovereignty through recognition of integration of EU law through Parliament, application of EU law by national courts under the jurisdiction of Parliament and interpretation of EU law through Parliament-established judicial order.

 

UK Parliament Perspective

The principle nature of EU law, known as the Doctrine of Supremacy, is recognized by the UK as legitimate[10], is applied by Parliament[11] and is effective through interpretation by British courts[12] is considered to exist in a duality of power with the British Parliament, because of Parliament’s regulatory power to withdraw from the Union[13]. This Parliamentary control over the relationship of the Doctrine of Supremacy is known as “continued sovereignty”[14]. It is the basic argument of the tradition of Parliamentary Supremacy, in relation to international treaties and principles, like the Doctrine of Supremacy[15]. Dualism arises from this argument, as the recognition, integration and application of the treaty within a sovereign legislature.

 

European Court of Justice Perspective

Through a historical precedence, establishing the Doctrine of Supremacy in EU law, the ECJ set out three conditions, whereby variance in interpretations of prevailing law are resolved: First, that contentious national law becomes “automatically inapplicable”[16] upon Community law’s entrance in to force.[17]; Second, that Community law cannot be interrogated by national courts[18]; Third, that citizens and corporations may enjoy Community law rights within national courts[19]. The ECJ uses these conditions to impose supranational governance- the Doctrine of Supremacy.

The UK parallels these interpretations of the Doctrine of Supremacy in a system of dualism, which harmonizes EU law and the UK Parliament. Dualism is established because of recognition of competing supremacies within UK governance[20], which are resolved through interpretation of Supremacy by the UK Parliament[21], and the application of EU law in areas of UK Parliamentary contention[22].

 

Recognition of Competing Supremacies

After the ratification of the European Communities Act in 1972, and accession to the European Union in 1973[23], the Case of Bulmer v. Bollinger (1974) gave clarification[24] to the scope of problems the UK faced in accepting the Doctrine of Supremacy. Lord Denning famously stated,

The Treaty is quite unlike any of the enactments to which we have become accustomed … It lays down general principles. It expresses its aim and purposes. … But it lacks precision. It uses words and phrases without defining what they mean. A British lawyer would look for an interpretation clause, but he would look in vain.”[25]

By accepting the Doctrine of Supremacy under dualist governance with Parliamentary Sovereignty, the problem of interpretation is posited. How does a polity operate, given the necessity to interpret laws from other powers? Lord Denning continues on,

“What are the British courts to do when they are faced with a problem of interpretation? They must follow the European pattern… They must look to the purpose and intent … They must divine the spirit of the Treaty and gain inspiration from it. If they find a gap, they must fill it as best they can.”[26]

As defined stare decisis by the ECJ, the UK’s “problem of interpretation,” must be resolved through eliminating variance in of Community law. Lord Denning understands this resolution as a movement towards acceptance of EU Law, and posits an understanding by the British, in order to interpret EU law. Bulmer v. Bollinger therefore defines the manner in which the UK accepts the Doctrine of Supremacy upon ratification of the ECA; British courts must recognize principles of EU law, in light of British tradition. Bulmer v. Bollinger differentiates the areas of the Supremacy Doctrine’s competence from the direct effectiveness of that law within the British polity. This differentiation recognizes a dualist balance in the problem of interpreting EU law.

Application of the Doctrine of Supremacy

The UK Parliament allows EU law to be directly effective within national court legislation. In this sense, recognition of the Doctrine of Supremacy under the tradition of Parliamentary Supremacy leads to the application of EU law to provisional legislation. Contention between EU law and UK Acts of Parliament are reified by the relationship of dualism, which can be seen as established through the application of both the Doctrine of Supremacy and Parliamentary Sovereignty in the case of Factortame Ltd v. Secretary of State for Transport [27]. Factortame questioned the UK’s legislation, which cited an Act established by the same Parliament[28] as its legal basis. Despite the citation of an Act of Parliament, the ECJ ruled against the House of Lords legislation, which directly violated the tradition of Parliamentary Sovereignty as explained by Albert VennDicey,

No person or body is recognized by the law of England as having a right to override or set aside the legislation of Parliament.”[29]

Through the primacy of ECJ legislation granting interim relief, this case became definitive of the Doctrine of Supremacy’s powers against the will of Parliament. In this case, Lord Goff notably says that, “As a matter of Community law, interim relief had to be available in principle against the Crown.”[30]

The ECJ ruled in accordance with the ECJ ruling that contentious law becomes inapplicable under the Doctrine of Supremacy[31], and the Supreme Court Act of 1981. The Supreme Court Act of 1981 established in the case of Factortame, that the British Parliament had not correctly interpreted the EU Directive when making the legislation preempting the decision of Factortame. By defining the extent to which the Doctrine of Supremacy could alter a decision by Parliament, Factortame did not further restrict Parliamentary Sovereignty beyond the reification of the ECA.

Parliamentary Sovereignty was maintained on a dualistic level to the Doctrine of Supremacy, in that the interpretation of EU Law was at issue. Dualism in application of the Doctrine of Supremacy stands a questionable forefront in Factortame, because of the removal of an Act of Parliament. Dualism is confirmed in Factortame because the ECJ interprets the application of the Doctrine of Supremacy as a remedy mechanism for such variances in interpretation[32]. The Doctrine of Supremacy is therefore contextually applied within the ECA, under the British Parliament’s sovereign power.

Interpretation of the Doctrine of Supremacy

Through a disambiguation in the application process for EU law in British courts, the Factortame proceedings illuminate the Doctrine of Supremacy’s force upon UK legislation, and also the duality of interpretation between the ECJ and the UK Parliament. Specified under the ECA section 3(1), interpretation of the EU Treaty law must be done within the UK courts, or referred through Article 267 Treaty of the Functioning European Union to the ECJ. The ECA sets precedence for interpretation by the national courts, in light of Article 177 of the Treaty of Rome, which encourages harmonization of interpretation of EU law among all member states.

Unlike the interpretive procedures established and adjusted since Factortame, the Thoburn v. Sunderland City Council[33] case posits a question of Parliamentary Supremacy in the interpretive process. In the case of Thoburn, the European Charter on Human Rights was put in to question, as a determination of biased judicial proceedings regarding the application for appeal to the ECJ. Despite Thoburn appeal to the ECJ, claiming his referential rights had been violated, the ECJ did not make jurisdiction on the case of Thoburn, leaving the UK jurisdiction to be sovereign.  Stated by victorious party, the Sunderland City Council,

EU law should be seen as having been entrenched, rather than merely incorporated, into domestic law, by virtue of a principle of EU law which was independent of constitutional principles of national law, such as dualism.”[34]

This case represents the struggle of duality between UK Parliament’s sovereignty to interpret EU law under the Doctrine of Supremacy. The Doctrine of Supremacy was not applied to the interpretation in Thoburn, because of the EU’s Principle of Legal Certainty. This Principle is inherent to the operation of dualism in the UK, because it grants confidence to the national courts, unless “It appears, on the basis of objective, relevant and consistent evidence, to have been adopted with the exclusive or main purpose of achieving any end other than those stated.”[35]

In response to clarification in Factortame of the interpretive power of the judicial officer and House of Lords, and the assumptions in Thoburn about the judicial bias towards UK Parliamentary Sovereignty, the ECHR contended that the UK did not sufficiently separate powers for interpretation of EU law[36][37]. In an effort to divorce the possibility of biased elections for a judiciary board for interpretation of EU law, the UK passed the Constitutional Reform Act in 2005[38]. Through creating an independent judiciary[39], a new Supreme Court[40] and a new system for the appointment of judges[41], the CRA restructured the judicial pattern for interpretation of EU law.

By ushering in a separation of powers, the UK maintains its duality through substantialzing the judicial interpretation methods under EU law. The Doctrine of Supremacy is adhered to, without a change in the Parliamentary make-up. Judicial institutions, which support Acts of Parliament, are acting on behest of Parliament’s will to follow the ECA. With extensive interpretive power given to the judicial system, and a set of common laws that the ECHA sets out under the Human Rights Act of 1998, the question of continued sovereignty of Parliament is posited.

Continued Sovereignty and Dualist Governance in the United Kingdom

 

In the case of Pickin v. British Railways Board[42],  the UK defines the purpose of Parliamentary Sovereignty, in a context of it’s validity within British legislation. Through initially defining the British tradition of Parliamentary Sovereignty, Pickin sought to define which body within the British polity, be it the House of Lords or the Parliament itself, should interpret a body of law for the purpose of application. Citing the Act of Parliament in 1911[43]and the subsequent Interpretation Act of 1978[44], Pickin established that Parliamentary acts cannot be questioned by the House of Lords, but can be interpreted through them. This interpretation procedure gave rise to the idea that, without a referential procedure from the courts to Parliament, the British courts must rely on a sort of European Union Grundnorm[45]. Recognition of a European Grundnorm would inherently restrict Parliamentary Sovereignty, because of its directly effective nature[46], without legislation through Parliament.

In an effort to alleviate this contention between interpretation by the courts and continued sovereignty, the EU Bill became an Act of Parliament on 19 July 2011,. The EU Bill sought to legalize the political agenda of dualism, and establish a referential procedure from the UK courts towards Parliament, in order to avoid a divergence towards the formation of EU law as Grundnorm, Primacy of EU law in this sense would negate Parliamentary Sovereignty of the UK, as explained by Pickins v. British Railways Board. Clause 18 of the EU Bill legitimizes dualist governance within the United Kingdom, which seeks to affirm Parliamentary Sovereignty, by acknowledging that the UK allows EU law to operate within it. Citing the case of Thoburn[47], in which it is made clear that EU law takes affect through an Act of Parliament, the EU Bill affirms UK dualism.

“Status of EU law dependent on continuing statutory basis:

By virtue of the European Communities Act 1972 directly applicable or directly effective EU law (that is, the rights, powers, liabilities, obligations, restrictions, remedies and procedures referred to in section 2(1) of the European Communities Act 1972) falls to be recognized and available in law in the United Kingdom.”[48]

Debate surrounding Clause 18 of the EU Bill, known as the ‘Duality Clause’[49], cites the legal inapplicability of the EU Bill to any further governance beyond the current Parliament. Dualism is also called in to question by the European Scrutiny Committee Report of 2011, when suggested that the EU Bill is itself binding Parliamentary Sovereignty, by restricting the future Parliaments to dualist governance. This would undermine the tradition of Parliamentary Sovereignty, as historically defined by Albert Venn Dicey, in that “Parliament is not bound by its predecessor.”[50] In response, the UK Government stated that the case for dualism is made merely in hope that “the Bill becomes part of the accepted constitutional framework of this country.”[51]

 

Conclusion

 

Attempts to establish a system of dualism undergo scrutiny from angles of its theoretical validity in relation to European Grundnorms, and its legal feasibility in becoming a British Parliamentary Tradition. Since the recognition of EU law in British legislation through the ECA, the UK has accepted the Doctrine of Supremacy through a means of dualist governance between it and the Parliament. Dualism is established through the continued sovereignty of UK Parliament, by way of recognition of the Doctrine of Supremacy, and then the application and interpretation of the Doctrine via British Parliament. Acceptance of the Doctrine of Supremacy by the UK through dualism creates a disjointed nature in interpretation of EU law, but maintains validity under continuous judicial reforms.

Bibliography

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Craig, Paul. “Britain in the European Union.” The Changing Constitution. Ed. Jeffrey L. Jowell and Dawn Oliver. Oxford: Oxford UP, 2007. 92. Print.

Jowell, The Rule of Law Today, in THE CHANGING CONSTITUTION 19 (J. Jowell & D. Oliver eds. 1989).

Kaczorowsky, Alina (2008). European Union law. Taylor & Francis. pp. 232. ISBN 978-0-415-44797-3.

Lakin, Stuart (2008). “Debunking the idea of parliamentary sovereignty: the controlling factor of legality in the British constitution”. Oxford Journal of Legal Studies (Oxford University Press)

McAuslan, Patrick, and John F. McEldowney. Law, Legitimacy, and the Constitution: Essays Marking the Centenary of Dicey’s Law of the Constitution. London: Sweet & Maxwell, 1985. Print.

“Official Journal of the European Union.” EUR-Lex. N.p., n.d. Web. 20 Nov. 2012.

T. Allan, “Parliamentary Sovereignty: Lord Denning´s Dexterous Revolution” (1983)

“The EU Bill and Parliamentary Sovereignty” European Scrutiny Committee. 2011. Section 6 (72)

Wade, The Basis of Legal Sovereignty, [1955] CAMBRIDGE L.J.,

Winterton, G, ‘The British Grundnorm: Parliamentary Supremacy Re-examined’ ( 1976) 92 Law Quarterly Review 591-617.

Statutes Cited

Act of Parliament. 1911. Section 3

Constituttional Reform Act. 2005. Sections 1, 3, 4.

ECHR. 2005. Article 6.

European Communities Act. 1972. Sections 1, 2, 3.

Merchant Shipping Act. 1988.

The EU Bill. 2011. All Sections.

The Interpretation Act.1978. Section 22(1).

UK Accession Treaty. 1972

Vienna Convention on the Law of Treaties. 1980. Vol. 1155, p. 331

 

Cases Cited

Amministrazione delle Finanze dello Stato v. Simmenthal. 1977.

Bulmer v. Bollinger. 1974.

Costa v. ENEL. 1964.

Factortame Ltd v Secretary of State for Transport [1990] : 2 [1991] : No3 [1992] : 4 [1996] : 5 [1999]

MacCarthys v Smith. 1981.

NV Algemene Transport-en Expeditie Ondernem- ing van Gend & Loos v. Nederlandse Administratie der Belastingen. 1962.

Pickin v British Railways Board. 1974.

Thoburn v. Sunderland City Council. 2002.


[1] European Communities Act 1972 S 1(2)

[2] Vienna Convention on the Law of Treaties. 1980. Vol. 1155, p. 331

[3] ECA 1972 S 1(2)

[4] ECA 1972 2(2)

[5] ECA 1972 3(1): [Community] added for clarification purposes.

[6] “Official Journal of the European Union.” EUR-Lex. Article 220. Web. 20 Nov. 2012.

[7] Dicey, Albert Venn. Introduction to the Study of the Law of the Constitution. London: Macmillan, 1959. Print.

[8] Craig, Paul. “Britain in the European Union.” The Changing Constitution. Ed. Jeffrey L. Jowell and Dawn Oliver. Oxford: Oxford UP, 2007. Print. pp. 96

[9] ibid.

[10] ECA 1972 S 1(2)

[11] The EU Bill. 2011. Para. 73

[12]Factortame Ltd v Secretary of State for Transport.

[13] The EU Bill. 2011. Para. 73

[14] Dicey, Albert Venn. Introduction to the Study of the Law of the Constitution. London: Macmillan, 1959. Print.

[15] MacCarthys v Smith. 1981.

[16] Amministrazione delle Finanze dello Stato v. Simmenthal. 1977.

[17] ibid.

[18] Costa v. ENEL. 1964.

[19] NV Algemene Transport-en Expeditie Ondernem- ing van Gend & Loos v. Nederlandse Administratie der Belastingen. 1962.

 

[20] Bulmer v. Bollinger. 1974.

[21]MacCarthys v Smith. 1981.

[22]Factortame Ltd v Secretary of State for Transport.

[23] UK Accession Treaty. 1972.

[24] T. Allan, “Parliamentary Sovereignty: Lord Denning´s Dexterous Revolution” (1983)

[25] Bulmer v. Bollinger. 1974.Ch. 401.

[26] ibid.

[27] Factortame Ltd  v Secretary of State for Transport.

[28] Merchant Shipping Act 1988

[29] Dicey, Albert Venn. Introduction to the Study of the Law of the Constitution. London: Macmillan, 1959. Print.

[30] Arangonés, Jay. “Regina v. Secretary of State for Transport Ex Parte Factortame Ltd.: The Limits of Parliamentary Sovereignty and the Rule of Community Law.” Fordham International Law Journal 14.3 (1990): 778-819. Print.

[31] Amministrazione delle Finanze dello Stato v. Simmenthal. 1977.

[32] Ibid.

[33] Thoburn v. Sunderland City Council. 2002.

[34] “The EU Bill and Parliamentary Sovereignty” European Scrutiny Committee. 2011. Section 6 (72)

[35] Kaczorowsky, Alina (2008). European Union law. Taylor & Francis. pp. 232.

[36] ECHR. 2005. Article 6 (paragraph 1)

[37] “UK Regulatory Materials Summaries” Strategic Research Unit. 1991. European Law Society.

[38] Constituttional Reform Act. 2005.

[39] ibid. Section 1.

[40] ibid. Section 3.

[41] Ibid. Section 4(2)

[42] Pickin v British Railways Board. 1974.

[43] Act of Parliament. 1911. Section 3

[44] The Interpretation Act.1978. Section 22(1).

[45] Craig, Paul. “Britain in the European Union.” The Changing Constitution. Ed. Jeffrey L. Jowell and Dawn Oliver. Oxford: Oxford UP, 2007. 92. Print.: Grundnorm is equivilant to British Common Law, as presented by Craig.

[46] Factortame Ltd (1) v Secretary of State for Transport [1990] : 2 [1991] : No3 [1992] : 4 [1996] : 5 [1999]

[47] The EU Bill. 2011. Para. 73

[48] The EU Bill. 2011. Clause 18.

[49] “Alliance of Liberals and Democrats for Europe.” Andrew Duff.  21 October 2011. The Financial Times.

[50] Dicey, Albert Venn. Introduction to the Study of the Law of the Constitution. London: Macmillan, 1959. Print.