On 7 December 2020, Ofcom, the UK’s communications regulator, found that The Family Programme, a live radio broadcast, featured potentially harmful statements about the COVID-19 pandemic without adequate protection for listeners.
The regulator currently prioritises cases linked to the coronavirus where programmes may have helped spread misinformation or included misleading material about the illness and public policy in relation to it. The Family Programme is broadcast every Sunday on New Style Radio 98.7 FM, which is a community radio station providing a service for Afro-Caribbean communities in Birmingham. The licensee for this service is the Afro-Caribbean Millennium Centre (ACMC).
During the programme, a number of “highly contentious, unevidenced conspiracy theories about the coronavirus” were set out. In its ruling, Ofcom highlighted controversial allegations that wearing face masks can “cause serious neurological and respiratory damage”, as well as suggestions that Bill Gates intended to reduce the world population, and mark and control 7 billion humans through vaccination. At the time of the broadcast, human and clinical trials were ongoing around the world to develop and deploy an effective vaccine, which is recognised by the scientific and medical community (and endorsed by the World Health Organisation) as the key to controlling and potentially defeating the COVID-19 pandemic. Ofcom was particularly concerned that such unsubstantiated claims would cause harm to listeners by undermining confidence in any future roll-out of a vaccination programme.
The presenter, Simon Solomon, referred to the crisis as an orchestrated “plan-demic” linked to the roll-out of 5G, and repeated without challenge throughout the programme the suggestion that “government and WHO policies are deliberately aimed at killing people.” Much of the discussion centred around a document written and a video presented by conspiracy theorist Claire Edwards, both of which have been discredited by fact-checking initiatives or trustworthy media organisations. Ofcom expressed serious concerns that such allegations could lead listeners to disregard public authorities’ advice and the social distancing measures intended to protect public health (especially at a time when coronavirus cases were rising and the government had just announced a second national lockdown in England).
The regulator rejected the presenter’s arguments that he had not endorsed Claire Edwards’ claims. In its view, the presenter had increased the potential for harm by lending the contents of those claims further credibility and adding greater weight: “listeners would have been left in no doubt that the presenter supported the contents of Ms. Edwards’ documents.” ACMC accepted the regulator’s findings and mentioned in its response that, as Mr. Solomon was a “very experienced” presenter, they “could not have possibly envisaged” that he would present a programme containing potentially harmful material. The licensee also stated that The Family Programme broadcast at issue could be seen as an “aberration” and believed that it constituted an “exception” to their normal high standards of professionalism.
In considering whether ACMC had provided listeners with “adequate protection” from this potentially harmful material (as Rule 2.1 of the Ofcom Broadcasting Code requires), Ofcom ruled that the disclaimer given by the presenter at the beginning of the programme had the potential to compound the potential harm to members of the public: “Rather than provide a warning about the unsubstantiated and controversial nature of the conspiracy theories put forward in the programme, in our view [the disclaimer] denigrated listeners who did not subscribe to them and cast doubt on the veracity of mainstream and credible sources of information about the coronavirus pandemic.” Moreover, according to Ofcom, Mr. Solomon had presented highly contentious claims as unequivocal facts and uncritically guided listeners to use the programme as the basis for their research.
Ofcom considered the steps ACMC had taken to mitigate the potential for harm following the broadcast of the programme; these were the suspension of the programme and its presenter, as well as the broadcast of “a special programme” about the coronavirus, which was aired on 15 November 2020 at the same time as the original programme and which “comprehensively refuted all the conspiracy theories” included in the initial broadcast.
The regulator emphasised that broadcasting views which question official authorities on public health information is not in principle prohibited and acknowledged the presenter’s right to discuss contentious viewpoints. However, in doing so, broadcasters must ensure compliance with the Code. Despite the actions taken by the licensee, the regulator was of the opinion that there were not sufficient measures in place to ensure that listeners were protected from the inclusion of “potentially extremely harmful material” in this programme, which was broadcast for two hours “without sufficient warnings, context or challenge during a public health crisis.”
As a result, Ofcom found that New Style Radio had committed a serious breach of the Broadcasting Code and directed the station to broadcast a summary of its ruling. The regulator has yet to give a final verdict regarding a suitable sanction, which could determine whether Solomon shall continue on the station as a presenter.
This article originally appeared on the IRIS Merlin legal database and is reproduced here with permission and thanks.
A publication featuring rapid responses to the impact of COVID-19 from a range of Essex experts has been recognised as influential by a panel providing evidence to government.
The summary, Rebuilding a Resilient Britain: Vulnerable Communities, looks at the relevant expert evidence in 11 Areas of Research Interest (ARIs), selected by Chief Scientific Advisors within the Government Office of Science.
The contributions of Essex experts are noted under two ARIs: “the role of local authorities in protecting vulnerable populations”; and “analysis of whether, where and how states or non-state actors use the disruption caused by the crisis to curtail minority rights or promote ideologies”.
Dr Carla Ferstman, who co-edited the Essex collection, said: “The goal of the publication was to bring together the widest possible array of scholars to think through the multiple, intersecting impacts of COVID-19, and to help frame the global research agenda. The interest in COVID-19, Law and Human Rights: Essex Dialogues has exceeded our initial expectations. It has fostered interdisciplinary research and has led to important new collaborations within academia and in numerous policy domains.”
COVID-19, Law and Human Rights: Essex Dialogues has been downloaded over 2,700 times since its publication in July 2020, making it the most downloaded single publication in this period on the University’s Research Repository. The individual chapters from the publication have resulted in an additional 5,500 downloads.
ARIs were developed as a result of the Nurse Review of Research Councils, which called on government departments to communicate clearly where their research objectives lie. The ARIs are an annually-updated list of priority research questions, chosen from a list of topics identified by government departments, which in turn invite academics to engage with government departments to inform policy making.
The report was produced by the Vulnerable Communities Working Group, which comprises 26 members including academics, civil servants, funders and civil society groups.
The foreword to their report notes: “Working across government and drawing from the extensive expertise of our academic community will be essential in the recovery from the COVID-19 pandemic, to rebuild a resilient Britain.”
This post originally appeared on the University of Essex news webpage and is reprocuded here with permission and thanks.
UK communications regulator Ofcom has so far made six sanctions decisions on broadcast content related to the coronavirus. What do these decisions illustrate about what Ofcom considers harmful? In this post, Professor Lorna Woods explains the different types of harm that the regulator appears to take into account when considering misinformation around the virus and COVID-19.
Ofcom guidance on coronavirus
On 23 March 2020, UK communications regulator Ofcom issued guidance on content standards during the pandemic. Building on the generally applicable Broadcast Content Code, the Ofcom guidance highlighted the importance of sections 2 and 5. Section 2 deals with harm and offence; section 5 with impartiality and accuracy. It might be thought that content about COVID-19 that has little evidential support could be dealt with under section 5, as Ofcom has previously dealt with complaints about climate change and anti-vaccine views on this basis. Yet Ofcom’s guidance on coronavirus points back to its approach to ‘health and wealth claims’ under rule 2.1. This rule specifies that broadcasters should apply ‘generally accepted standards’ to ‘provide adequate protection’ from harmful and/or offensive material. Ofcom’s Coronavirus guidance highlighted three areas of concern:
health claims;
medical advice; and
the need for accuracy in programmes dealing with the virus or with public policy in relation to the virus.
The guidance does not give much detail on how harm might arise, so what can be discerned from Ofcom’s approach in practice?
Health and wealth claims
Ofcom defines health or wealth claims as statements that specific products, practices or activities will result in various benefits, especially when conventional treatments or advice are dismissed. Based on research it commissioned, the regulator has identified ‘a hierarchy of factors affecting the level of potential harm arising’, divided into three categories which it applies in cases involving health or wealth claims generally. Primary considerations are the vulnerability of the audience (e.g when they may be affected by serious illness) and the authority of the speaker. Secondary factors include the range of views presented, and the level of certainty ascribed to them. Tertiary factors are personal gain, genre, audience size and time of broadcast.
A further programme (The Last Leg on Channel 4) is identified as Covid-related, but it was not pursued. It concerned comments made by a guest on the programme about Boris Johnson’s health, rather than the public health impact seen in the other programmes. It is not possible to identify a full list of programmes which might have raised coronavirus issues but which were not taken forward because Ofcom gives no reasons for such decisions, just stating that the complaints have been dismissed (this is a possible failing in Ofcom’s systems).
These six programmes promoted 5G technology as a cause of coronavirus. Loveworld News also suggested hydroxychloroquine as a ‘cure’ for COVID-19. During the sermon there was a call for people to ‘pray against the false vaccine’. All suggested an ulterior motive for lock-down (the creation of a new world order) and that government advice was not to be trusted. In The Family Programme, which heavily promoted a document entitled ‘The COVID-19 genocide of 2020’, there were references to ‘our duty to break unjust laws’. With the exception of This Morning (which was still criticised), Ofcom found breaches of the code. In its London Live decision, Ofcom emphasised that its ‘rules do not prohibit the broadcast of controversial or outlandish views’ but ‘broadcasters must ensure that such views are properly contextualised so as to comply with the Code’.
What is harm?
These decisions illustrate what might be considered (in the broadcast context) harmful and that the ways that harm might be envisaged to arise show different levels of connection to the content, which we can ascribe to three broad categories: direct, indirect and societal.
A direct connection between content and harm can be seen, for example, in the context of photosensitive epilepsy (not in issue here), where content might have a direct impact on the psychology or emotional state of the audience. To the extent that psychological or emotional well-being was considered, it was a factor in assessing the vulnerability of members of the audience. The concern in this context is therefore probably not their psychological or emotional well-being (though this can be seen in the context of some decisions in relation to children under rule 1 of the Broadcast Content Code), but the steps that individuals may take in response to the content: an indirect harm.
Indirect harm could occur because of a belief in the effectiveness of hydroxychloroquine or thinking that 5G causes coronavirus, which could lead people to engage in risky behaviours contrary to official advice (e.g. not social-distancing or injecting harmful substances). It could also include circumstances when individuals seek to damage 5G masts. In this, the link between content and harm is indirect: it requires action on the part of the viewer to give effect to the harm. This approach is not new. It ties in with the concerns Ofcom identified with regard to health claims and medical advice generally, and can also be seen with the rules in the Content Code relating to copycat behaviours.
London Live argued that it had removed any content that could have been considered to be medical advice or contrary to government guidance. The discussion was general and not aimed at any particular person. Ofcom still found the content to be harmful, however. This seems to extend the understanding of harm: what is distinctive here is that the harm occurs at the societal level, relating to virus spread, rather than just individual risk.
This broad approach to the societal category of harm is noticeable as regards Ofcom’s third category of concern: the approach to public policy. Although Ofcom emphasised the importance of a robust debate around the Government’s handling of the pandemic and in particular the restrictions to our freedoms, Ofcom found harm arising from criticism of Government’s motives. Some criticism, for example that in The Family Programme where the presenter repeatedly commented that “Government and WHO policies are deliberately aimed at killing people” was extreme. Nonetheless, it seems that there is a low threshold to trigger this concern which is especially noticeable in Ofcom’s This Morning decision. There, the comparatively mild challenge to the government’s policies was assessed by Ofcom as ambiguous but yet was determined to have undermined people’s trust in official advice. Although a failure to follow government advice could clearly lead to harm – whether to the individual not following the advice or to others as a result of the spread of COVID-19 – this seems to be a broad understanding of harmful content, especially given the role of the media in holding government to account.
Conclusion
It is important, however, to appraise these decisions in context. The programmes (with the partial exception of This Morning) promoted extreme views. In the London Live interview, for example, the interviewee stated that the world is controlled by a cult which wants to create “a beyond Orwellian global state in which a tiny few people dictate to everyone else”. In the Loveworld Sermon, the preacher argued that there was a sinister plan for the survivors of Covid-19:
“And the younger ones that are strong enough for the formation of the new breed that is in the dream, the new breed, the new class of people that some scientists want to create for the world. While all others may soon have to perish.”
Similar views were repeatedly expressed in The Family Programme. Additionally, we should remember that the rule relates not to the existence of harmful content, but to the broadcaster’s failure to protect the audience. In these cases (This Morning being the exception), there were only minimal attempts to provide balance or context in the presentation of the content, and the viewpoints were in each case adopted by the presenter, giving that viewpoint weight and authority.
All of Ofcom’s decisions emphasised – in accordance with its approach to health and wealth claims – the vulnerability of the audience, here the concerns arising from the spread of a novel virus for which there was at the time no cure or even particularly effective treatment, especially in groups or areas particularly adversely affected. So, while Ofcom recognises a broad scope to harm in this context, the decisions on the facts were balanced. It is far from certain that Ofcom would find other views that are critical of the Government to be harmful; this trend would certainly not seem to be applicable beyond the pandemic situation. Finally, the challenge brought by the Free Speech Union was unsuccessful; permission to bring a judicial review action was refused.
This post first appeared on the Media@LSE blog and is reproduced here with permission and thanks.
Serial health risks are increasing in occurrence and have the capacity to affect large numbers of people living in different countries. Thalidomide, contaminated blood, Diethylstilboestrol (DES), asbestos and Bovine Spongiform Encephalitis (BSE) are among some of the most well-known examples of serial health risks damaging human lives, but the recent Covid-19 outbreak reminds us that such risks have always existed, primarily in the form of epidemics. Yet, the legal treatment, in civil liability, of personal injury resulting from serial health risks often lacks clarity not only because serial health risks have diverse origins, but also because they can trigger different regimes of civil liability. Given their increasing importance and this lack of clarity, I devoted my PhD thesis to the comparison of how the French and English legal systems responded to serial health risks in civil liability. I concluded that while these two legal systems are facing similar legal challenges from a civil liability perspective, they have not always responded in a similar manner. In fact, I argued that their differences of approach highlight unreconcilable views as to the conception of civil liability, its role and its underlying objective. My analysis also led me to conclude that despite these differences, the legal treatment of victims of serial health risks remained unsatisfactory in both legal systems due to unjustifiable inequality of treatment. The following post will provide a summary of the key-findings from my PhD thesis.
Background
My interest in comparing the legal treatment of serial health risks in French and English civil liability stemmed from a theme that I uncovered while I was writing my master’s dissertation in France. At the time, I was working on issues of proof of causation in civil environmental liability in French and English law and discovered that, besides environmental cases, other cases raised similar issues of proof of causation.
Yet, these cases involved risks with diverse origins: the risks were occupational (asbestos, brick dust, mechanical vibrations, etc.), technological (electromagnetic waves, nuclear radiations), pharmaceutical (thalidomide, contaminated blood, DES, PIP prostheses, metal-on-metal hip prostheses, anti-hepatitis B vaccine, pertussis vaccine, etc.), food-related (BSE-contaminated beef), consumer-related (tobacco), industrial (Round-up) and environmental (pollution). More importantly, these cases triggered the application of different civil liability regimes: liability for defective products, nuisance, and negligence (employers/employees, producer/consumer, etc.).
Nevertheless, despite these important material differences, they also presented common features: claimants always suffered from diseases, a specific type of personal injury, and as a result, all cases were concerned with risks to human health; they were all connected to the widespread use of products and substances, therefore raising the number of victims to potentially catastrophic levels; finally, all involved serial damage, a legal concept sometimes used by continental legal scholars to refer to a type of damage that affects a number of people spread in various locations and at different times but connected to a common origin.
In summary, these cases were all dealing with health risks leading to serial damage which I will refer to as ‘serial health risks’. Given their common features, it was no surprise to observe that they often raise similar issues for the application of civil liability.
As I already mentioned, proof of causation is often a crucial issue in these litigations because our understanding of aetiology of diseases is generally fraught with significant gaps in scientific knowledge. As a consequence, the existence of scientific uncertainties is particularly challenging to the success of tort claims. Additionally, when numerous plaintiffs are similarly affected by the same substance or product, courts are likely to face a flood of tort claims. Large cohorts of claimants put a strain on the justice system, thereby leading to question whether the tort system is the best way forward in dealing with compensation, and if so, how it copes with large numbers of claimants.
Research question
While this area of litigation has become increasingly important both in the number of cases and in monetary value (potentially multi-millions pounds litigation), legal scholars have mostly purported to follow a sectoral approach, devoting their analysis to one legal issue at a time (causation, collective redress, etc.). I believed that a more comprehensive study of the interactions between serial health risks and civil liability was needed in order to bring clarity into this complex area of law and that drawing on the legal experiences of both the French and English legal systems could be beneficial to inform on how similar issues of civil liability were approached in legal systems with different legal traditions.
Through this comprehensive analysis, I sought to investigate how personal injury resulting from serial health risks was treated by civil liability in both legal systems.
Choice of jurisdictions and methodology
The French and English legal systems have been chosen because they have different legal traditions (civil law vs common law) and were influenced by European Union law. More importantly both legal systems were good comparators because they have had to deal with the same issues of serial health risks at a similar point in time using the same scientific knowledge available, examples being contaminated blood, asbestos or BSE. For this reason, the comparison of French and English responses to this new problem seemed particularly apposite.
To conduct my research, I borrowed from both functional and contextualist methods of comparison. When looking at the practical issues connected to the application of civil liability in the context of serial health risks and the solutions developed in French and English law to address them, I used a functional method through a careful examination of French and English jurisprudence. However, I believed this approach to be limited: while the solutions adopted in both legal systems could be functionally equivalent, they could nonetheless be justified by different reasons. Hence the real divergences between legal systems could well remain hidden if my analysis was limited to a functional approach. I therefore complemented my comparative work with an analysis of political and social contexts to identify the underlying reasons and objectives behind the adoption of solutions in French and English law.
Comparative findings
My main findings can be summarised as follows:
The comparative analysis revealed that French and English law are moving towards improving the protection of victims’ interests in the context of serial health risks.
For example, both legal systems introduced compensation schemes to provide victims of certain serial health risks with expedient compensation under more flexible requirements than that of civil liability. Such schemes have benefited victims of contaminated blood, asbestos, vaccines (France and England), Diethylstilboestrol (DES), Mediator, Depakine (France), and BSE (England). Furthermore, French and English legislators have introduced strict liability regimes in sectors of activity where serial health risks could materialise with the aim to facilitate defendants being held legally liable. The introduction of the nuclear liability regime and the liability for defective products are the most seminal examples (chapter 3).
Similarly, I show that collective redress mechanisms have been introduced in the French and English legal systems not only to cope with large cohorts of claimants seeking compensation through judicial process but also as a means to restore the ‘balance of power’ between plaintiffs (private individuals) and defendants (often large companies) through allowing individual plaintiffs to aggregate (Goliath v. Goliath). I demonstrate that the conditions to launch group litigations are designed to deal with victims of mass torts which include victims of serial health risks, although I also identified difficulties in both legal systems which impede the efficacy of these mechanisms in practice.
Finally, the analysis of case-law provided me with clear evidence that proof of the traditional requirements of civil liability (in particular causation) has sometimes been adapted to allow victims of serial health risks to succeed where they should have normally failed (chapter 5 to 10). Once again, this is indicative of the importance given to victims’ interests from a civil liability perspective.
However, despite these converging evolutions, I conclude that the treatment of serial health risks in French and English civil liability remains fundamentally different.
For example, the comparison of French and English compensation schemes in the context of serial health risks reveals that while French schemes are often designed as an alternative compensation mechanism to the tort system, English statutory schemes are engineered as a supplementary compensation mechanism to the tort system. In other words, where French compensation schemes generally compete with the tort system, English statutory schemes are created as a last resort mechanism and can only be actioned when all else fails. This important divergence underlines the fact that the French legal system readily separates compensation from civil liability in order to promote compensation while the English system continues to see the tort system as the primary route for obtaining redress. Similarly, while legislators on both sides have introduced strict liability regimes, their number remains limited in England while in France they continue to grow. This suggests a willingness by the French legal system to move from fault-based liability to strict liability. In contrast the English legal system is reluctant to depart from the fault principle to compensate personal injury resulting from serial health risks (chapter 3).
The application of tort law rules to situations of serial health risks is another striking example of the different approaches taken by the two legal systems. In chapter 2, I developed a detailed typology of serial health risks based on the level of scientific knowledge and distinguished ‘known’, ‘suspected’ and ‘unknown’ risks. In chapter 5 to 10, I used this typology to examine the judicial treatment of serial health risks in French and English civil liability. In French law, I found that the conditions of civil liability are consistently adapted, and that proof of these requirements are facilitated to ensure that the victims could obtain compensation, regardless of whether the situation is one where the risk is unknown, suspected or known. In other words, French law favours victims’ compensation in all situations of serial health risks. Conversely, the position is much more nuanced in English law: the less knowledge that is available as to the existence of risk, the less likely it is that relaxation of tort law will be accepted (chapter 6 to 10). As a result, proof of causation has been adapted where risks are known but not where risks are either suspected or unknown.
I argued that the aforementioned differences are not simply differences of degree between the legal systems. Rather they show irreconcilable views as to the role played by civil liability in the context of serial health risks.
When considering the balance between the protection of bodily integrity (claimants’ interest) and the protection of economic freedom (defendants’ interest), the French legal system took the clear view that the protection of bodily integrity is to be favoured in the context of serial health risks. To this effect, civil liability is simultaneously declining due to other compensation mechanisms emerging, and yet strengthened due to the introduction of strict liability regimes, collective redress mechanisms and relaxation of tort law conditions. These conflicting trends can all be explained when regarding the underlying goal being pursued in French law, which is ensuring that victims of serial health risks obtain compensation. The interests of defendants are therefore systematically sacrificed.
The English legal system has made another choice. While the protection of bodily integrity is undeniably important, it is not a sufficient reason, in and of itself, to sacrifice the defendants’ interests. Other reasons are needed to support a relaxation of the traditional rules of civil liability and examination of English case law reveals that judges are careful to evaluate conflicting interests to determine which one should be given precedence. This explains why the more scientific uncertainty there is with regards to the existence of the risk, the less willing English law is to relax the traditional rules of tort law. This approach reveals that English law is much more concerned than French law with the need to strike an appropriate balance between the protection of bodily integrity and the protection of economic freedom.
Finally, I found the legal treatment of serial health risks to be unsatisfactory in both France and England, albeit for different reasons.
If, as my analysis suggests, the French legal system is overly concerned with the compensation of victims of serial health risks, then the arrangements currently in place are not satisfactory, especially when considering the solutions crafted through legislature. French legislators have succumbed to the temptation to develop solutions on a sector-by-sector basis which can lead to victims being treated differently simply because serial health risks have different origins. For example, French legislators introduced collective redress for victims of personal injury in the health sector but not in relation to the food industry. As a result, thalidomide-type victims could benefit from group litigations but not BSE-type victims. I found this sectoral approach to be sorely lacking and difficult to justify.
The English legal system has favoured an approach whereby victims of serial health risks are treated differently depending on the level of scientific knowledge available. I argued that this approach can be justified and is more rational than that adopted in French law which differentiates victims according to the origin of serial health risks. Yet, the English approach is not without problems because it can also lead to victims of serial health risks being treated differently for no valid reason. English judges are trying to preserve a balance between conflicting interests (bodily integrity vs economic freedom) which results in relaxation of traditional rules to have limited applicability. In order to ensure limited applicability, English judges are drawing subtle distinctions between cases. For instance, the applicability of exceptional rules of causation (chapter 9 and 10) depend on whether the situation is one of alternative or cumulative causation, whether there is one or multiple noxious agents at play, whether the disease is divisible or indivisible. Hard cases often challenge the practicality of these distinctions and reveal that, as is the case in France, victims of serial health risks can be treated differently with little rationality behind the solutions. The worst example is linked to victims of asbestos where the solutions depend on whether such victims are suffering from mesothelioma, a specific disease linked to asbestos exposure, or not.
Conclusive thoughts
This comparative analysis was designed as a starting point. It aimed to provide a clear picture of the current position of how French and English law are dealing with the fallout of serial health risks from a civil liability perspective. Shortcomings have been identified in both legal systems which need to be addressed in future work to ensure that victims of serial health risks are treated more equally. The recent Covid-19 outbreak, probably the biggest serial health risk that our generation had to face, serves to reinforce this point.
Essential workers have put their lives on the line to allow for essential activities to continue during the lockdown. Healthcare professionals and carers primarily, but also supermarket workers, train and bus drivers, firefighters, postmen and delivery men amongst many others have had to work, sometimes in very close proximity to the general public, in order to deliver these essential services. Some of them, as we know, have died due to Covid-19 therefore raising the question of whether the State should step in to provide some type of compensation to essential workers and their bereaved families. It would appear that, once again, not all key workers have been treated the same. In particular, healthcare professionals and carers have benefited from special arrangements both in France and in England, a “privilege” that was not extended to other key workers.
While the nature of the work conducted by healthcare professionals and carers undeniably put them at a high risk of contamination from Covid-19, the same could be said of all key workers who have had to work in contact with the public. Why then should some essential workers be treated better than others? This latest example shows that unless we are planning on rethinking our general approach to serial health risks, the shortcomings previously identified in my work will be further aggravated.
This post originally appeared on the British Association of Comparative Law Blog and is reproduced here with permission and thanks.
Her paper examined the distinction between legally enforceable status of the Coronavirus Act 2020 and the persuasive status of various Government guidance on the coronavirus on social relationships and communications. Her paper placed a particular focus on social distancing, social gatherings and the use of face masks.
Just to provide an overview, the Coronavirus Act 2020 was created via emergency powers and was fast-tracked into existence in just four days. As a consequence, this statute lacked the usual prolonged scrutiny which legislation receives from the Houses of Parliament. The urgency to create new law was to address the high numbers of people becoming seriously ill or dying due to contracting the coronavirus. The Conservative Government was under pressure to impose practical measures via law to reduce the spread of the virus, which had swept across the world, and to provide special protection for vulnerable members of society including the elderly and disabled.
Dr. Davey’s paper sought to address the legitimacy of ministerial coronavirus guidance which has been created through powers under the Coronavirus Act.
It placed a focus on social distancing, social gatherings and the use of face masks. In doing so, her paper explored the legitimacy of the coronavirus guidance and its application by public bodies, with reference to three of the Nolan principles on integrity, accountability and openness, which guide the conduct of public officials such as ministers.
The discussion considered how social and familial relationships are being increasingly regulated, including by criminal law, due to the guidance created by the Executive and applied by public bodies such as the police. A particular cause for concern is the extent to which members of the public and public bodies (such as police and councils) can fully appreciate the distinction between guidance, which is not usually legally enforceable, and legislation, which is legally enforceable.
This could be the most significant test of Spain’s fairness as a society.
Starting last month, Spain has a minimum income scheme in place. Considering some of the international coverage, you would be forgiven for thinking it is some sort of universal basic income. It is not so. It is rather a social assistance programme for the poorest families, similar to the ones existing in other European countries. Households will be allowed to claim between 462 and 1,015 Euro depending on their size and composition. The benefit will be compatible with other sources of income, in which case the amount of the benefit would be lowered accordingly.
It is a very last resort, which, believe it or not, the fourth largest economy in the Euro-area did not have until now, not at least for the whole country, and not one that deserved that name.
If it works well, this initiative has the potential for alleviating the most severe forms of social exclusion. Spain has the dishonour of having one the highest rates of child poverty in the EU: one in four children live below relative poverty in households that get less than 60% of the median income. After a long decade of austerity policies, this is a victory for the left, possibly the most significant one since equal marriage (2005), the social care law (2006) and the historical memory law (2007).
But, as well as a victory, it is also the expression of a huge policy and political failure. Spain’s regions and nationalities have had the power and the responsibility to protect the most vulnerable for more than three decades. However, by and large they have failed to do so, in a systematic breach of the human rights to social security and to an adequate standard of living.
The 1978 Constitution established that social security should be maintained “for all citizens (to) guarantee adequate social assistance and benefits in situations of hardship” (Article 41). Spain does have social security with public pensions, including non-contributory pensions, unemployment protection and other economic benefits for those temporarily unable to work for different reasons. But a lot of people suffer long-term unemployment, work in extremely precarious jobs, or are simply left behind by the system. The Constitution also bestowed on regions and nationalities the power to set up complementary social assistance schemes (Article 148.1.20), and all 17 of them accepted this responsibility in their respective statutes of self-government.
Starting with the Basque Country in 1989 and Andalusia in 1990, each region has created its own system. But there is huge variation between them in terms of coverage, adequacy and conditionality.
As seen in the table below (based on data from 2018), Madrid and the Basque Country are two of the richest regions, with similar levels of GDP per capita. Yet, despite having one third of Madrid’s population, and half the poverty level (6.4 for 12.3%), the Basque scheme reaches 2.3 times more people and public expenditure is 2.6 times greater. The Basque programme covers 88% of those in greatest need, compared to 23% in the case of Madrid.
With the exception of Navarre, La Rioja and the Basque Country, the vast majority of regions leave out half of the population that meet the economic criteria. The general average is just 21.33%, which means that almost eight in 10 people are unable to get the economic support they need. With just over 8% of the country’s population, nearly 38% of all recipients, living in the Basque Country, Navarra or Asturias, the three regions accumulate 43% of all of Spain’s public spending on minimum income.
Source: Adrián Hernández, Fidel Picos and Sara Riscado, “Moving towards fairer regional minimum income schemes in Spain”, JRC Working Papers on Taxation and Structural Reforms, European Commission, April 2020, p. 12
The austerity of the 2010s created an ever-greater need for a people’s quantitative easing. However, because of limited resources in some cases, and ideological blindness and lack of interest in others, for three decades the regional public authorities failed to fulfil the right to social assistance recognised in Article 13 of the European Social Charter, leaving millions of people behind.
Looking at the small print
Let us hope Spain’s new minimum income scheme will mark a turning point. For now, it is too early to tell if it will match up to the expectations. A number of issues remain unclear and are concerning.
For example, the coverage is arbitrarily limited to people between 23 and 65 years of age. Public authorities at the central, regional and local levels should urgently develop truly accessible and non-bureaucratic procedures. Considering the digital divide, it is essential to establish a system by which individuals can request this benefit from social services face-to-face. In light of the concerning experiences in other countries, observers must watch out for the possible misuse of sanctions and conditionalities. Just as crucial, existing regional schemes should be retained and developed to complement the new central benefit.
The real test will come when the flashlights focus on something else. If the practical questions get answered, and if conservatives do not get rid of it when they return to power whenever they do, then we will be able to celebrate this as one of the most important victories of the left.
This could be the most substantial policy for the people at greater risk of harm, disadvantage and poverty. This could be the most significant test of Spain’s fairness as a society.
The elephant in the room is that none of this would have happened without Covid-19. But this cannot be a passing whim, nor a PR stunt for the left-leaning coalition government. The right-wing Popular Party and the extreme-right Vox seem very confused. Some of their leaders have spoken against this initiative with hyperbolic references to the nanny-State. However, they did not dare to vote against it when the debate came to Parliament in mid-June.
The real test will come when the flashlights focus on something else. If the practical questions get answered, and if conservatives do not get rid of it when they return to power whenever they do, then we will be able to celebrate this as one of the most important victories of the left.
This could be the most substantial policy for the people at greater risk of harm, disadvantage and poverty. This could be the most significant test of Spain’s fairness as a society.
This post first appeared on Open Democracy and is reproduced here with permission and thanks.
England is no stranger to strategic or – at times – abusive use of insolvency provisions.
In the early 2000s, a mechanism frequently used by debtors to retain the control of distressed companies at the expense of their creditors was pre-packaged administration. Following some empirical studies and a public consultation, the Coalition Government introduced some changes to the insolvency system to address the concerns from the industry and practitioners. Yet, it seems that Parliament will have to turn again its attention to similar issues in the not-so-distant future.
In fact, the recent case of Virgin Atlantic, which filed for Chapter 15 protection in the USA to shield itself from the claims of its creditors, as well as other trends in the rescue practice, bring back to the fore the ongoing issue of strategic or abusive use of insolvency provisions.
This blog post briefly discusses whether, and the extent to which, we should be worried by these growing trends in the rescue “industry”.
Pre-Packaged Administrations
Pre-packaged administrations are a hybrid form of corporate rescue. These procedures combine the benefits of informal workouts with the properties of formal procedures.
In a pre-packaged administration, the sale of the distressed business is negotiated before the debtor files for insolvency. Usually, the buyer is a person connected to the debtor’s existing shareholders, sometimes even the existing shareholders or directors. The sale is effected shortly after the debtor files for insolvency, leaving the creditors with no remedies and abysmally low returns for the money they lent to the debtor.
In a paper published at the beginning of this year,[1] Dr. Vaccari identified the characteristics that make a pre-packaged administration abusive. This happens when the sale is determined by a close group of players, who collusively act solely to sidestep or subvert insolvency rules and extract value from the company. To be abusive, such actions should cause undue financial harm to the creditors and fail the “next best alternative” valuation standard.
Conscious of the risks associated with pre-packaged administrations, the Coalition Government launched a study into these proceedings which resulted in the Graham Review (2014) as well as in minor regulatory changes. Some of the industry-led measures introduced following the Graham Report are currently under review. The recently enacted Corporate Insolvency and Governance Act 2020 introduced an extension[2] to end of June 2021 to the power to legislate on sales to connected persons, which was granted by the Small Business, Enterprise and Employment Act 2015 (‘SBEEA 2015’) but expired in May 2020.
It seems accurate to claim that the risks of abusive use of pre-packaged administrations, especially in sales to connected parties, have been significantly curtailed since the regulatory and industry-led changes introduced in 2015. Nevertheless, shareholders and directors have not embraced overnight a new, more inclusive and stakeholder-oriented approach to the management of corporate crises. As a result, the rescue industry has developed new mechanisms to sidestep and at times subvert insolvency rules, for the purpose of promoting the interests of out-of-money players (such as shareholders and directors) at the expense of the residual claimants in insolvency (i.e. secured and unsecured creditors).
Recent Trends
Some recent, high profile cases show the emergence of new trends in corporate rescue practice, designed to sidestep or subvert insolvency rules. These trends are light-touch administrations (LTAs), temporary stays on creditors’ claims – sometimes effected internationally – and reverse mergers.
In LTAs, administrators rely on paragraph 64(1), Schedule B1 of the Insolvency Act 1986 to allow the existing directors of an insolvent company to continue exercising certain board powers during an administration procedure. This practice, however, undermines one of the pillars of the English corporate insolvency framework, i.e. that those responsible for the debtor’s failure are not allowed to run the company in insolvency. The idea behind this choice is that independent insolvency practitioners are better placed than existing directors to protect and promote the interests of creditors as a whole, without necessarily affecting the chances of the debtor to be rescued or sold on a going concern basis.
In LTAs, the existing directors are not free to do whatever they want. Directors usually sign with the administrator a consent protocol, prepared by the Insolvency Lawyers Association and the City of London Law Society. Such a protocol introduces restrictions to the use of directors’ powers in order to safeguard the interests of other creditors and stakeholders. However, in a recent article yet to be published,[3] Dr. Vaccari conducted a doctrinal analysis of the guidance provided by the courts in running LTAs and concluded that the interests of unsecured creditors are unduly affected by these procedures.
The recent events in Debenhams’ restructuring support the early findings in Dr. Vaccari’s article. Debenhams became the first high street business in the UK to enter a LTA process in April 2020, after sales plummeted under the nationwide lockdown. To date, Debenhams’ lenders and owners are “highly supportive” of the LTA process and are funding the administration fees. The process is likely to result in a sale of the profitable assets of the business by the end of September 2020.
So, all good? Not really. In the meanwhile, Debenhams is not paying its landlords and suppliers, with the exception of essential ones. Many workers are paid by the Government (and the taxpayers) through the Job Retention Scheme. Also, this LTA represented the third time the retailer underwent some form of insolvency procedure in less than a year. Earlier attempts included a pre-packaged administration after rejecting financial support from Sports Direct’s owner Mike Ashley and a company voluntary arrangement.
In other words, Debenhams is a “zombie” business, something out of The Walking Dead. It has already been killed several times by the market; it is a failed business, yet it is still operating for the benefit of existing shareholders and directors.
Debenhams is not the only recent case of strategic use of insolvency provisions. After the rejection of a bailout request by the UK Government, Virgin Atlantic worked on a £1.2 bln rescue deal with some of its shareholders and private investors to stave off collapse. It is likely that the negotiations will go ahead – despite the shaky financial situation of the company – thanks to a moratorium or stay on executory actions by the creditors. This moratorium is one of the innovations introduced by the Corporate Insolvency and Governance Act 2020[4] and it has been used as part of a restructuring plan procedure under the newly introduced part 26A of the Companies Act 2006.
However, Virgin Atlantic has assets all over the world. In order to protect them from executory actions, the company sought recognition of the English stay under Chapter 15 of the U.S. Bankruptcy Code. Chapter 15 is a part of the U.S. Bankruptcy Code designed to facilitate cooperation between U.S. and foreign courts. It was added to the code in 2005 by the Bankruptcy Abuse Prevention and Consumer Protection Act, and it allows foreign individuals or companies to file for bankruptcy protection in the U.S. in cases where assets in more than one country are involved. When the order is granted, it is usually recognised all over the world, thus protecting the debtor’s assets against creditors’ predatory actions.
Often, Chapter 15 is filed in conjunction with a primary proceeding brought in another country, typically the debtor’s home country. However, no such proceeding has been opened with reference to Virgin Atlantic. The restructuring plan mentioned above is a company, rather than an insolvency procedure, which means that creditors are less protected than in insolvency. The effect of the Chapter 15 filing is, therefore, to give world-wide recognition to a private agreement negotiated by the company’s directors and key creditors with the support of existing shareholders. A vote on the plan from the wide range of creditors who have legitimate claims against the company will not take place until late August, with a confirmation hearing scheduled for the beginning of September. As a result, the outcome of the Virgin Atlantic case is not dissimilar from Debenhams’ one: the claims of out-of-money shareholders and directors are prioritised against the legitimate interests, rights and claims of other, less sophisticated creditors.
Finally, a practice that it is emerging with renewed preponderance is the use of “reverse mergers” or “reverse takeovers”. A reverse merger is a merger in which a private company becomes public by acquiring and merging with another public company. If the public company files for insolvency first, sells all its assets but keeps its legal standing, the private buyer can go public by merging with the public, insolvent company. In this way, the private buyer avoids the complicated and expensive compliance process of becoming a public company by merging with the insolvent, public debtor. Additionally, all licences, permits, quotas, clearances, registration, concessions etc. conferred on the insolvent debtor will continue with the buyer despite the changing of hands of the controlling interest.
This may, in theory, seem a good idea to maximise the value of the insolvent debtor. Ultimately, the debtor’s listing in the stock exchange (and its public nature) is an asset. What’s wrong in selling it?
First and foremost, the fact is that compliance regulations are sidestepped. Unlike a traditional Initial Public Offering (IPO), reverse merger disclosure documents are generally not reviewed by securities commissions; only by the exchange on which the two companies propose to list. Although this reduces the regulatory burden on issuers, it also dispenses with an important element of investor protection.
These regulations are not simply procedures designed to make life difficult to companies that want to go public. These are procedures designed to protect investors and, ultimately, creditors.
Additionally, another reason to opt for a merger rather than a purchase is if the target company has significant net operating losses that the buyer might be able to use to reduce its tax liabilities. Finally, reverse mergers do not necessarily require concurrent or any kind of financing, as they can take place with a share exchange.
In the U.S. the process has been used by several companies, particularly by start-ups in the automotive sector. These include Nikola Motors, Lordstown, Fisker Automotive, Velodyne Lidar and bus-maker Proterra. At the time of writing, Nikola Motors has a stock exchange value exceeding US$2 bln, while Lordstown has a stock market value of US$1.6 bln. If you haven’t heard these names before, you’re not the only one. Both Nikola and Lordstown have yet to produce their first (electric) vehicle!
It is not surprising that all these companies relied on reverse mergers to go public. Reverse mergers involve less regulatory scrutiny, are cheaper in terms of professional and other expenses, faster than a traditional IPO and able to avoid or minimize market and execution risk on their going-public transactions. Which, ultimately, brings us to the question: are reverse mergers of an insolvent public company a trick or a threat for the debtor’s stakeholders?!?
What’s Next
The Government should respond promptly to these new trends emerging from practice. The commitment to promoting a rescue culture and – more generally – the rescue of distressed yet viable businesses cannot come at the expense of “everything else”. Cases like Debenhams, Virgin Atlantic and the U.S. listing of automotive start-ups suggest that the market is unable at the moment to self-regulate.
The Covid-19 pandemic accelerated a trend towards the strategic or abusive use of insolvency provisions. If unchecked, this trend can only result in more insolvencies and higher taxes.
If suppliers are not paid, the above-mentioned insolvencies will create a domino effect in the industry and they will result in further filings. As for taxes, Dr. Vaccari mentioned in a previous blog post that the re-introduction of the Crown preference is expected to increase the returns to the HMRC. However, higher numbers of insolvency procedures and a downturn of the economy are likely to affect the capacity of companies to generate revenue and – as a result – to pay taxes. If companies pay less taxes and the Government is forced to spend more in subsidies to companies and employees, this is likely to result in cuts to public services and higher rates of taxes for people and companies alike.
The publications mentioned in this article are available on Westlaw, Researchgate.net and Academia.edu. Dr. Vaccari regularly discusses insolvency matters on Twitter and LinkedIn.
[1] E Vaccari, ‘English pre-packaged Corporate Rescue Procedures: Is There a Case for Propping Industry Self-Regulation and Industry-Led Measures such as the Pre-Pack Pool?’ (2020) 31(3) I.C.C.L.R. 170, 184-185.
[3] E Vaccari, ‘Corporate Insolvency Reforms in England: Rescuing a “Broken Bench”? A Critical Analysis of Light Touch Administrations and New Restructuring Plans’ (2020) I.C.C.L.R. (forthcoming).
In corporate insolvency procedures, not all creditors are alike. This is despite the pari passu principle.
The pari passu principle is often said to be a fundamental rule of any corporate insolvency law system. It holds that, when the proceeds generated by the sale of debtor’s assets are distributed to creditors as part of an insolvency procedure, they have to be shared rateably. In other words, each creditor is entitled to a share of these proceeds that corresponds to the percentage of debt owed by the company to its creditors.
Imagine that a company has creditors for £100,000. Creditor A has a claim for £1,000, creditor B for £5,000. The company is insolvent and it is liquidated. The sale generates £50,000 of proceeds available to be distributed to the creditors. While it would have been possible to say that, for instance, older creditors or creditors with larger claims are paid first, the pari passsu principle states that all creditors are treated alike. As a result, creditor A will receive 1% of these proceeds (£500), while creditor B will receive 5% of them (£2,500).
There are, of course, exceptions to the pari passu principle.
First, the pari passu principle applies only to assets that are available for distribution. For instance, a bank may have granted a mortgage to the debtor to buy a property, and the debtor may have given that property as a collateral to the bank. If the debtor becomes insolvent, the proceeds generated by the sale of that property are distributed first to the bank and then, if anything is left, to the other creditors.
Secondly, the law might introduce exceptions to this principle in order to prioritise the payment to creditors that are deemed particularly worthy of additional protection.
The Law
Until the Enterprise Act 2002, the Inland Revenue and HM Customs & Excise (now HMRC) were granted a status as preferential creditors for certain debts listed in Schedule 6 of the Insolvency Act 1986. As a result, debts owed to the them had to be fully paid before any distribution to floating charge holders, pension schemes and unsecured creditors (among others) was made.
This preferential status granted these agencies a stream of £60-90 million each year in insolvencies. Section 251 of the Enterprise Act 2002, however, abolished the Crown’s status as preferential creditor and introduced a new regime (the ‘prescribed part’) wherein a portion of the distributions in liquidation was ring-fenced specifically for unsecured creditors.
Back in the 2018 Budget, mixed in with many other tweaks, the Government announced a seemingly innocuous change to the way in which business insolvencies will be handled from 6 April 2020 (later postponed to insolvencies commencing on or after 1 December 2020, irrespective of the date that the tax debts were incurred or the date of the qualifying floating charge).
Without attracting much publicity, the announced move was codified in sections 98 and 99 of the Finance Act 2020, which received Royal Assent on 22nd of July 2020. As a result, HMRC gained secondary preferential treatment over non-preferential and floating charge holders – often banks that have loaned money to firms – for uncapped amounts of VAT, Pay As You Earn (‘PAYE’) income tax, student loan repayments, employee National Insurance Contributions (‘NICs’) or construction industry scheme deductions.
In a related development, Parliament also approved the Insolvency Act 1986 (Prescribed Part) (Amendment) Order 2020. The effect of this Act is to increase the prescribed part from £600,000 to £800,000. However, this change does not apply to floating charges created before 6 April 2020.
So What?
The Government argues that giving HMRC priority for collecting taxes paid by employees and customers to companies is appropriate. These represent taxes that are paid by citizens with the full expectation that they are used to fund public services. Absent any form of priority, this money actually gets distributed to creditors instead. As a result, the Exchequer should move ahead of others in the pecking order and give HMRC a better chance of reclaiming the £185m per year they lose.
These explanations do not appear totally sound. The creation of the prescribed part and the increase of its cap to £800,000 served the purpose of ensuring that at least some of this money is paid back to the HMRC and used to fund public services. What has not been properly considered is the impact the Crown preference and the increased prescribed part will have on: (i) the wider lending market and access to finance; as well as (ii) corporate rescue practices.
With reference to lending practices, the new system disproportionately affects floating charge holders and unsecured creditors. The abolition of administrative receivership – a procedure controlled by lenders – by the Enterprise Act 2002 was compensated by the loss of preferential status for the HMRC. The re-introduction of such preference means that lenders in general and floating charge holders in particular will be pushed to lend money at higher interest rates, as lenders have no idea as to the tax arrears of any borrower on a day to day basis.
Lenders now face a double blow (increased prescribed part and Crown preference) in relation to realisations from the floating charge. They are, therefore, likely to reduce the amounts that they lend to businesses, to take account of the dilution in the realisations that they would receive in insolvency. This is a particularly unwelcome outcome in the current marketplace.
Lenders are even more likely to seek fixed charge (where possible) and to introduce covenants for reviewing the debtor’s tax liabilities. Such liabilities are likely to increase significantly in the next few months, as VAT payments due by businesses between March and June 2020 have been deferred until the end of the 2020/21 tax year. Lenders may also insist that a borrower holds tax reserves to deal with liabilities to HMRC and, in large operations, on group structures which minimise the dilution from Crown preference.
Finally, unsecured creditors may choose to protect themselves by keeping their payment terms as tight as possible and limiting the number of days that credit is offered for.
Additionally, and perhaps more importantly, such move may hamper the willingness to support an enterprise and rescue culture, which was the main justification for the abolition of the Crown’s preference. This is because HMRC’s gain is the other creditors’ loss, especially considering that the taxes classified under the preferential claim are ‘uncapped’ (while before the enactment of the Enterprise Act 2002 they were capped to amounts due to up to 1 year before the commencement of the procedure).
Despite assurances to the contrary, the existence of a preferential treatment may push the HMRC to exercise increased control over the insolvency process and promote early petitions for liquidation in the hope of higher return.
Also, the HMRC has never historically been particularly supportive of reorganisation efforts. This means that distressed companies may have to file for a new restructuring plan under part 26A of the Companies Act 2006 and seek a court-approved cross-class cram-down to overcome the HMRC’s negative vote. Such an approach would increase cost, litigation and time needed for the reorganisation effort, thus potentially pushing viable debtors out of business.
There are other elements that militate against the re-introduction of such preferential status. HMRC currently have the ability to robustly manage their debt. HMRC have powers not available to other unsecured creditors, including the ability to take enforcement action without a court order to seize assets and to deduct amounts directly from bank accounts.
HMRC have the power to issue Personal Liability Notices to corporate officers for a failure to pay National Insurance Contributions (NICs) or future unpaid payroll taxes. HMRC also have the power to insist on upfront security deposits where there is a genuine risk of non-payment of PAYE, NICs or Value Added Tax (VAT). Similarly, HMRC may issue Accelerated Payment Notices for disputed tax debts.
One of the key features of the English corporate insolvency framework is its focus on promoting business rescue and, more in general, a rescue culture, as evidenced in previous papers[1] by the author of this post. The recent long-term changes introduced by the Corporate Insolvency and Governance Act 2020 seemed to go in the direction of strengthening the rescue attitude. It makes, therefore, little sense to introduce policies designed to help businesses survive the Covid-19 pandemic and, at the same time, reduce their ability to borrow cheaply. The re-introduction of the preferential status for certain unpaid taxes spins the clock back to 2003 and is likely to hurt the existing, fragile business recovery.
The publications mentioned in this article are available on Westlaw, Researchgate.net and Academia.edu. Dr. Vaccari regularly discusses insolvency matters on Twitter and LinkedIn.
[1] E Vaccari ‘English Pre-Packaged Corporate Rescue Procedures: Is there a Case for Propping Industry Self-Regulation and Industry-Led Measures such as the Pre-Pack Pool?’ (2020) 31(3) I.C.C.L.R. 169; E Vaccari, ‘Corporate Insolvency Reforms in England: Rescuing a “Broken Bench”? A Critical Analysis of Light Touch Administrations and New Restructuring Plans’ (2020) I.C.C.L.R. (accepted for publication); E Vaccari, ‘The New ‘Alert Procedure’ in Italy: Regarder au-delà du modèle français?’ (2020) I.I.R. (accepted for publication).
While the impact of COVID-19 responses on human rights has elicited global attention and concern, much analysis has focused on tests of legitimacy for restrictions of civil and political rights, such as freedom of movement, freedom of association and privacy. Despite calls by the UN Secretary-General and the WHO to place the right to health at the centre of COVID-19 responses, this human right has been marginalized by Governments, as well as in many human rights analyses.
The Comment highlights that the human right to the enjoyment of the highest attainable standard of physical and mental health, protected in international human rights treaties, provides binding normative guidance for health-care systems, broader social responses, and global solidarity in the COVID-19 response. For example, the obligations on States deriving from the right to health require that States provide testing systems, personal protective equipment for frontline service providers, and health care, both for those suffering from COVID-19, as well as other essential healthcare services. It also requires actions beyond the health sector, to address social determinants of health which may be impacted by COVID 19, including through social distancing policies, which have a disproportionate impact on vulnerable and marginalized communities. Further, it requires States to protect vulnerable and marginalized communities, and to ensure that these communities participate in the design and implementation of COVID-19 responses.
One of the original features of international human rights law is that it supports both domestic and transboundary obligations. Thus, in the context of COVID-19, States must engage in international cooperation to support a coordinated global response, which has relevance across a range of fields such as the development of vaccines, economic sanctions, debt obligations and intellectual property. The right to health, as well as other rights, thus have an important role to play in responding to the call of the UN Secretary General for global solidarity in the COVID-19 response.
The Comment was originally published in 2020 by The Lancet, vol 359, p 1888.
Liverpool Street Station, London; photo by Ben Garratt
Lee Marsons, PhD Candidate and Graduate Teaching Assistant, School of Law, University of Essex
As part of my compilation of resources on Covid-19 for the UK Administrative Justice Institute (UKAJI), I have been paying close attention to the publication of delegated legislation throughout this crisis. My main sources for this have been legislation.gov.uk, the Gazette, and the gov.uk website. One of my growing concerns has been the number of times where I have observed a delay between new regulations being signed by a Minister and coming into force, and the regulations becoming publicly available on any of these websites.
The risk with this delay is that a Minister has created a new criminal offence – or at least has modified an offence created by previous regulations – without a member of the public being able to discern the offence’s specifics so that they may remain within the law. This concern is underlined when we realise that, since many of these regulations have been authorised by Ministers without recourse to Parliament in the immediate term, not even the elected representatives of the public may have knowledge of these offences so as to advise their constituents accordingly. As yet, I am unaware of an actual case, but with 15,715 fixed penalty notices having been issued as of 8 June 2020, there remains the real risk that a person has been, or will be, fined and prosecuted by the police where that person has had no ability to specifically discern the scope and contents of the regulation under which they have been sanctioned. Whatever theory of the rule of law one prefers, this state of affairs is troubling for those concerned with legal certainty for the individual vis-à-vis the punitive and coercive powers of the executive.
“now debating the coronavirus No. 3 regulations which…have in some cases already been superseded by the No. 4 regulations, which were laid before the House on Friday and in some cases came into force almost immediately afterwards, with some regulations coming into force on Saturday.”
This was a concern because:
“the regulations are actually quite complicated and not everybody will understand them in great detail, [and] because they are the law a breach of them is actually an offence. We are creating criminal offences here, and when we do that it is important that we let people know what the offence is and how they can make sure that they remain within the law. I suspect that if we were to do a survey among Members of Parliament, even they probably would not get all the regulations correct. They are quite difficult to follow, given that they start off with a set of regulations that is then amended over and over again. It is quite a challenge to work out what the current legal position is.”
Such are the risks to legal certainty in situations, like now, where major restrictions on ordinary liberties are achieved via statutory instruments which, while coming into force and creating offences immediately upon ministerial signature, may not be disseminated to the public – and are certainly not approved by Parliament – until some time later.
Protections in England, Wales, and Scotland
In England, Wales, and Scotland, there is at least the possibility that a person prosecuted in these circumstances would have a defence under s. 3(2) of the Statutory Instruments Act 1946, which reads that:
“In any proceedings against any person for an offence consisting of a contravention of any…statutory instrument, it shall be a defence to prove that the instrument had not been issued by or under the authority of His Majesty’s Stationery Office at the date of the alleged contravention unless it is proved that at that date reasonable steps had been taken for the purpose of bringing the purport of the instrument to the notice of the public, or of persons likely to be affected by it, or of the person charged.”
In the few cases to have considered s. 3(2), the provision is understood to provide a defence where there has been no act of publication or dissemination of the statutory instrument after its approval. As Streatfield J observed in R v Sheer Metalcraft [1954] 1 QB 586:
“There does not appear to be any definition of what is meant by “issue,” but presumably it does mean…that the making of an instrument is one thing and the issue of it is another. If it is made it can be contravened; if it has not been issued that provides a defence to a person charged with its contravention. It is then upon the Crown to prove that, although it has not been issued, reasonable steps have been taken for the purpose of bringing the instrument to the notice of the public or persons likely to be affected by it.”
Similar views were expressed by Lord Goddard in Simmonds v Newell [1953] 1 WLR 826, which concerned a statutory instrument which had been approved by a Minister but not made entirely publicly available:
“The Solicitor-General agrees that if this matter is not contained in the instrument, in order that people may know whether they are committing offences or not, it must be shown that proper steps have been taken to bring it to the notice of people in the trade that these prices exist. That is certainly a very reasonable attitude for the Solicitor-General to take up, because it is not desirable, in criminal matters, that people should be prosecuted for breaches of orders unless the orders can fairly be said to be known to the public. It is clear from the case stated that there never was evidence before the justices that the steps that the section requires to be proved by the prosecution had ever been taken and that the defendants were therefore entitled to rely on that as a defence.”
3) In proceedings against a person for an offence consisting of a contravention of a Scottish statutory instrument, it is a defence to prove that, at the date of the alleged contravention, the instrument had not been published by the Queen’s Printer.
(4) The defence mentioned in subsection (3) is not available if it is proved that reasonable steps had been taken before that date by or on behalf of the responsible authority to bring the purport of the instrument to the notice of –
(a) the public,
(b) persons likely to be affected by it, or
(c) the person charged.
Therefore, it seems a reasonable argument that where a Minister in England, Wales, and Scotland has created or modified an offence by statutory instrument and this information has not been made available to the public – perhaps, as I am considering here, because of a delay in disseminating the instrument – a person would have a defence against prosecution under these provisions during that period where the information was unknown.
However, it is unlikely to be as simple as this in reality. One complicating feature of these provisions is their demand that the purport of the instrument is brought to the notice of the public, rather than the instrument itself. This raises the question as to whether the daily broadcast press conferences attended by Secretaries of State, media interviews given by Ministers, and the guidance documents produced by Departments would make the purport of the instrument sufficiently clear, though the instrument itself is not yet public. It seems to me that there is no abstract answer to this question, it would be a matter of fact and degree in the circumstances of the case and would depend on whether Ministers have announced the major features of the offence to the public, perhaps alongside an indication of possible sanctions. Consequently, while these provisions provide no absolute bar against a prosecution in circumstances where a statutory instrument had yet to be published, it at least provides the possibility of a defence depending on the extent of the information given by Ministers about the offence through other channels, such as television or guidance documents.
Protections in Northern Ireland
In Northern Ireland the position is substantially more complex. The defence under s. 3(2) would not be available because, but for in specific circumstances, s. 13 of the 1946 Act declares that the Act does not extend to Northern Ireland. Nor is it obvious that Northern Ireland has an equivalent provision to s. 3(2) elsewhere. The best that I have discovered is Article 5(2)(b) of the Statutory Rules (Northern Ireland) Order 1979, which requires a Minister, ‘as soon as may be after the making of those rules to arrange for the publication of those rules or of notice of the making of those rules in the Belfast Gazette’. This is different to s. 3(2) because Article 5(2)(b) provides no actual defence to a prosecution, only an obligation on a Minister making those rules to publish them in a particular place.
Article 5(2)(c) provides that some statutory rules may be exempt from the requirements of Article 5(2)(b), namely those listed in Schedule 3 of the Order. These include the Public Health Acts Amendment Act 1907 and the Public Health (Ireland) Act 1878, but Schedule 3 does not mention the Public Health Act (Northern Ireland) 1967 nor the Coronavirus Act 2020, the parent legislation for most of the statutory rules made. Alternatively, s.8 of Schedule 3 also exempts statutory rules of a temporary nature which in the opinion of the Minister are likely to cease to be in force within three months after they are made. It is conceivable that a Minister might think this, but in my view that would be a major – and problematic – assumption to make in the coronavirus context. Therefore, without more, I assume that there is a requirement to make public in the Gazette any statutory rule related to coronavirus.
Where this has not been complied with, though there is no statutory defence, Lim Chin Aik v R [1963] AC 160 might be a helpful authority for a defence at common law. In this case, Lord Evershed, sitting in the Privy Council, commented that the traditional maxim ignorantia juris non excusat – ignorance of the law is no excuse – could not apply where there was no possibility for a person to carry out inquiries as to what the law affecting them was. Nevertheless, I am not certain that this is a conclusive authority for at least two reasons. First, these comments were obiter given that the main issue in the case was the mens rea of a Singaporean immigration offence. And second, there is no direct analogy to coronavirus rules because Lim Chin Aik concerned an order directed against a specific person that was not disclosed to that individual, rather than a general offence applying to all persons.
In addition, despite there being an obligation for a Northern Irish Minister to publish the relevant statutory rules, I am not convinced that a failure to do so would render a statutory rule ultra vires and, therefore, any relevant offence made void. There is no authority for this proposition from the courts (Westlaw, at least, identifies no cases at all on Article 5(2)(b)) or in the Order itself. As such, I can see no particular reason to be confident either of a common law defence or of the statutory rule being ultra vires.
All that said, the Human Rights Act 1998 may assist. In the qualified rights contained in Articles 8 to 11 of Schedule 1, any restriction on those rights must be ‘prescribed by law’. There is a plausible argument that a statutory rule that had not been published but had led to a conviction would not be ‘prescribed by law’ and, therefore, would violate one of the relevant qualified rights. I am assuming that since being prosecuted or fined for breach of the regulations may restrict a person’s ordinary movement and assembly, worship, business activities, family contact, and other social conduct, there may well be at least a modest interference with the rights to respect for private and family life (Article 8), freedom of assembly, association, and protest (Articles 10 and 11), and freedom of religion (Article 9).
In Huvig v France (1990) 12 EHRR 528, the European Court of Human Rights identified four questions from earlier cases which provide a test for deciding if any given interference with a right is ‘prescribed by law’:
Does the domestic legal system sanction the infraction?
Is the relevant legal provision accessible to the individual?
Is the legal provision sufficiently precise to enable the individual reasonably to foresee the consequences which a given action may entail?
Does the law provide adequate safeguards against arbitrary interference with the respective substantive rights?
The most relevant question here is question two – is the relevant legal provision accessible to the individual? In Sunday Times v United Kingdom (1979) 2 EHRR 245, the European Court held that accessibility means that the individual, ‘must be able to have an indication that is adequate in the circumstances of the legal rules applicable to a given case’. As an example, in Silver v United Kingdom [1983] 5 EHRR 347, the Court held that the Standing Orders and Circular Instructions which the Home Secretary issued to prison governors failed the accessibility test since they were not published, were not available to prisoners, nor were their contents explained in cell cards.
For these reasons, in circumstances where a Northern Irish statutory rule which had yet to be published led to a criminal conviction, it is likely that there would be a violation of one or more of the qualified rights under Articles 8-11 and, on that basis, the conviction would be unlawful given that under s. 6 of the 1998 Act, public authorities have an obligation to act compatibly with those rights. Nevertheless, where Northern Irish Ministers had not published the rules but had informed the public through other means – such as press conferences, interviews, and guidance – a Minister could still reasonably argue that, despite the failure to publish, the individual was still aware in principle of the relevant offence through other channels.
In sum, there is no easy answer to the concerns raised in this piece. There is no authority for any absolute prohibition or bar on prosecution in circumstances where a coronavirus related statutory instrument created or modified an offence, that offence was enforced, but the instrument had not yet been made available to the public. Nevertheless, at least in England, Scotland, and Wales, a person is likely to have a defence under s. 3(2) of the Statutory Instruments Act 1946 or under s. 41(3)-(4) of the Interpretation and Legislative Reform (Scotland) Act 2010 against such a prosecution. In Northern Ireland, where there is no equivalent provision, a person may still be able to use the Human Rights Act 1998 as a ‘shield’ against such a prosecution, on the basis that it would violate one of the qualified rights under Articles 8 to 11 to suffer a conviction in these circumstances. Hopefully these debates will never have to be tested in the courts because no person has been fined or prosecuted in these circumstances, but it is not obvious to me that this is so and legal advisors to those convicted under coronavirus regulations ought to bear this complication in mind.
The author would like to thank Grainne McKeever, Conor McCormick, Brice Dickson, James Chalmers, Benjamin Lewis, and Rich Greenhill for their helpful comments on this issue. Incidentally, if any readers are aware of a potential Northern Irish equivalent to s. 3(2) of the Statutory Instruments Act 1946, please do contact the author.
This post was first published on the UKAJI blog and is reproduced here with permission and thanks.
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