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EU launches court case against UK
Last Updated: 2022-02-11 09:27 | China Daily Global
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The European Commission has initiated its first post-Brexit court case against the United Kingdom in a move that prompted Prime Minister Boris Johnson to again threaten to suspend agreed trade checks on goods.

The Commission said on Wednesday it had referred the UK to the European Court of Justice, or ECJ, related to infringements of European Union law.

Specifically, the UK case refers to a British Supreme Court ruling from February 2020 that Romania should compensate investors who had lost out on state subsidies, despite the Commission having found previously that the compensation infringed EU state aid rules.

The Financial Times noted that the ECJ challenge to the UK Supreme Court decision comes amid EU-UK tensions over the Northern Ireland Protocol, which is an important component in the agreed post-Brexit trade relationship between the two sides that came into force after the UK withdrew membership from the EU in 2020.

Commission officials say the decision to refer the case on Romanian investment is not connected to the ongoing talks between the EU and UK to address problems with the protocol, reported the FT.

The EU Reporter news site explained that "in 2005 Romania had repealed an illegal State aid scheme" as a precondition for its accession to the EU.

It noted that in response, "Swedish-Romanian investors Ioan and Viorel Micula, as well as the Romanian companies controlled by them, instituted arbitral proceedings under a 2003 bilateral investment treaty concluded between Romania and Sweden".

In 2013, the tribunal ordered Romania to compensate the claimants for not having benefited in full from the investment arrangement.

However, in 2015, the Commission decided "that any compensation paid by Romania under the award was in breach of EU State aid rules" and ordered Romania to "recover any compensation paid to the beneficiaries of the award".

The EU now claims the British court judgment of 2020 "breached the principle of sincere co-operation" and violated EU law.

In Parliament on Wednesday, Johnson reiterated that the UK could still trigger Article 16 of the post-Brexit trade agreement, which would suspend some checks on goods between Great Britain and Northern Ireland.

In March last year, the EU instigated infringement proceedings against the UK over its failure to fully comply with the Northern Ireland Protocol, but this action was later paused as negotiations continued.

The Brexit withdrawal agreement ensured the UK would remain partially subject to ECJ rulings for four years after the transition period that ended on Dec 31, 2020.

Because Northern Ireland remains in the EU single market for goods, the ECJ also adjudicates disputes in that region as long as the protocol is in effect.

(Editor:Wang Su)

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EU launches court case against UK
Source:China Daily Global | 2022-02-11 09:27
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