“Statutory” is not a bogey word

Why statutory regulation of the press is itself neither a good nor a bad thing.

In a striking passage in his essay On Prejudice”, the great pamphleteer and critic William Hazlitt noted:

Defoe says, that there were a hundred thousand stout country-fellows in his time ready to fight to the death against popery, without knowing whether popery was a man or a horse.

In the current debate about press regulation, one gets the sense that the word “statutory” also has the same sort of bogey quality as “popery” did for Defoe’s stout country-fellows.  

There may not be a hundred thousand stout fellows decrying the prospect of menacing statutory provisions, but there are certainly are those who are against “statutory” regulation regardless of what that would actually mean in practice.

For some, it is as if just saying that regulation will be “statutory” is enough to discredit any proposal by itself.

But what does “statutory” actually mean, and is it necessary something of which one should be scared?

All “statutory” means is that a regulatory regime has some basis in an Act of Parliament. It may well be that the statute merely gives legal personality to a regulator, allowing it to hold property and enter into contracts as a corporation (and thereby employ people). But it can also mean that specific and residual powers for that regulator are set out in statute, including perhaps the powers to obtain information or impose fines. It all depends on what the statute says.

What “statutory” does not necessarily mean is that either government or parliament will have any control or influence over the activities of a statutory body.

Unless the Act of Parliament formally allows for such a role for politicians or departments, a “statutory” regulator can be just as independent (if not more so) as one based on contract or consent.

Unless a regulator has a statutory basis for its powers, the effectiveness of the regulator is entirely at the behest of the regulated. The regulated are then free not to comply with a non-statutory regulator (which in respect of the press is called the “Desmond problem” after the proprietor of the titles who withdrew from the Press Complaints Commission).

And a regulator without statutory powers is impotent when faced with a lack of cooperation: compare the refusal of News International to provide information to the PCC when the hacking scandal first broke with News International’s ready compliance with the statutory powers of the Leveson Inquiry (for example in the Nightjack case).

Almost every profession has a regulatory regime based in statute or a similar legal instrument (such as a Royal Charter). This includes professions which emphasise their day-to-day independence from the government of the day, such as lawyers and the police. “Statutory regulation” does not, by itself, mean either government control or parliamentary supervision; indeed, statutory provisions can entrench independence from wrongful interference by the politically powerful. In this way, statutory regulation can provide a shield as well as a sword.

Some journalists say that there is no place for any statutory regulation of the press whatsoever: the newspapers are there to hold MPs to account, the argument goes, and they cannot properly do this if they are subject to any control enacted by MPs.

However, this view is misconceived, as journalistic activity is already significantly regulated by statute, from the Contempt of Court Act and the Magistrates’ Court Act to the Data Protection Act and the Computer Misuse Act.

Indeed, the current edition of McNae’s Essential Law for Journalists lists over 85 statutes which can be applicable to a working journalist.

It may well be that some of these laws could be repealed or amended; but a journalist who does not believe themselves already regulated by statute is unaware of the legal context of what they do.

Accordingly “statutory” does not need to be a bogey word. And to sneer at “statutory” regulation, or be alarmist about it, is not enough to undermine it. The important question is what is being done with the statute.

And this also means “statutory regulation” is not necessarily a good thing either. The soundness of any regulatory regime for press will come down to how it will affect the behaviour of the regulated from that which would occur without regulation. A statutory power to obtain evidence or impose a sanction does not by itself mean a better outcome. Those in favour of a better newspaper industry cannot treat statutory regulation as a panacea. Black ink in a statute book is not enough to improve the culture which tolerated tabloid excesses.

As Lord Justice Leveson prepares to issue his Inquiry's report, the debate over press regulation risks being derailed by bluster and misdirection by vested interests.  The crucial thing is whether any proposed scheme actually works, and in what ways. And this is the case whether one thinks “statutory” to be a basis of legal power or a horse.

 

Some non-scary statute books today (pic: David Allen Green)

David Allen Green is legal correspondent of the New Statesman and author of the Jack of Kent blog.

His legal journalism has included popularising the Simon Singh libel case and discrediting the Julian Assange myths about his extradition case.  His uncovering of the Nightjack email hack by the Times was described as "masterly analysis" by Lord Justice Leveson.

David is also a solicitor and was successful in the "Twitterjoketrial" appeal at the High Court.

(Nothing on this blog constitutes legal advice.)

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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.