Northern Ireland’s 30 years of ‘Troubles’ were brought to an end by the 1998 Good Friday Agreement (the GFA). The GFA was based on the principle of cross-community support from both nationalists and unionists: a delicate compromise which sought a middle path between the Unionists – who see N Ireland as an integral part of the UK – and the Nationalists – who view the future of N Ireland as lying in reunification with the Republic.

The success of the GFA was underpinned by the fact that both the UK and the Republic of Ireland were in the EU.  Whilst both countries were members of the EU, there was no need for a border between N Ireland the Republic – goods and services could flow unimpeded across the border.  Leaving the EU required a bespoke solution to N Ireland – one that respected the GFA and did not reimpose a physical border between N Ireland and the Republic: a visible manifestation of a divided island.

Squaring the circle of respecting the GFA, whilst taking the UK as a whole out of the EU, was always the most complicated part of Brexit. With the UK outside the EU, a customs border would be required somewhere: it could not be between N Ireland and the Republic, because of the need to respect the GFA and avoid antagonizing the Nationalist community. The only place that border could be therefore, was in the Irish Sea between N Ireland and the rest of GB – which risked irritating the Unionist community.

The Northern Ireland Protocol

The solution to this delicate balancing act was the Northern Ireland Protocol (the NIP), which left N Ireland in the EU Single Market, but brought it out of the Customs Union, enabling N Ireland to have the best of both worlds, with one foot in the UK and the other in the EU.  However, the NIP imposed checks on goods (especially food and medicine) from GB arriving into N Ireland, to ensure they complied with EU standards and avoid the risk of them leaking into the EU Single Market through the back door: these checks have so far been unilaterally postponed by the UK.

Elections add to the complexity…

In the Queen’s Speech on 10 May 2022, the UK Government set out its legislative programme for the months ahead. This includes: reforms to UK data protection laws (no details yet); confirmation that the government will strengthen cybersecurity obligations for connected products and make it easier for telecoms providers to improve the UK’s digital infrastructure; and new rules to enable the use of self-driving cars on public roads. In addition, the government confirmed its plans to move forward with the Online Safety Bill. As part of the government’s broader agenda to “level up” the UK and provide a post-Brexit economic dividend, many of the legislative initiatives referenced in the Queen’s Speech are presented as seeking to encourage greater use of data and technology to support innovation and enable growth.

We summarize below the key digital policy announcements in the Queen’s Speech and how they fit into wider developments in the UK’s regulatory landscape.

The UK is not alone in feeling the effects of the Russia-Ukraine crisis which compounded an already tight energy market, in which the post-Covid economic recovery caused demand to outstrip supply. But the UK does appear to have been perhaps more heavily affected by this combination of factors, which has led to a steep rise in energy costs. With an average UK family’s energy bill increasing by 54% so far this year and inflation nudging the double-digit mark, the ONS declared earlier this month that the squeeze on living standards was the worst since the 1950s.

The EU has belatedly realized the dangers of its over-reliance on Russian hydrocarbons and is urgently seeking to source gas and oil supply elsewhere. In the short to medium term, this will force global gas prices higher as the EU competes on global gas markets for a constrained resource. In the longer term, countries view the war in Ukraine as a clear indication that reliable, clean, domestically-produced renewable energy bolsters national security by removing dependence on volatile international hydrocarbon markets. The PM’s comments in the foreword – “We need a power supply that’s made in Britain, for Britain” – underline how that sentiment also applies in the UK, whilst at the same time hint, perhaps worryingly, at a less globalized future energy market.

It is against this backdrop that on 7 April, almost unnoticed, the UK Government published its long-awaited Energy Security Strategy (ESS). The ESS was supplemented by the announcement in this week’s Queen Speech of the proposal for an Energy Security Bill, building on last year’s COP26 Summit in Glasgow and designed to deliver the transition to cheaper, cleaner, and more secure energy in the UK.

UK Energy Security Strategy

Immediate Support on Energy Bills

The ESS sets out a new Energy Bills Support Scheme that will see a £200 reduction in energy bills from October 2022, to be offset against a Government levy on domestic energy bills over 5 years from FY23. To mitigate the high cost of industrial electricity, the Government will extend the Energy Intensive Industries Compensation Scheme for a further three years, and increase the intensity of the aid to up to 100 per cent, representing 1.5 per cent of Gross Value Added. It will also consider increasing the renewable obligation exemption to 100 per cent. These measures will enable businesses to apply for greater relief for part of their electricity costs. The Government has since announced that the total level of compensation under the Scheme will increase from roughly £130 million to up to £280 million.

Energy Efficiency

Building on existing efforts to promote the energy efficiency of UK homes, the Government will make the installation of energy-saving materials zero-rated for VAT purposes for the next five years. A new £450 million Boiler Upgrade Scheme will facilitate the uptake of heat pumps, alongside a Heat Pump Investment Accelerator Competition being run in 2022, worth up to £30 million. Later this year, the Government will aim to publish proposals incentivising electrification, which aims to ensure that heat pumps are comparatively cheap to run. The Government will increase innovation funding for the development and piloting of new green finance products for consumers from £10 million to £20 million. Early 2023 will see a formal consultation on new minimum standards and labelling requirements for a range of energy-using products.

Oil and Gas

The ESS sets out the Government’s vision for the North Sea, noting that in order to reduce reliance on imported fossil fuels, the UK must fully utilise North Sea reserves; use empty caverns for CO2 storage; and encourage the use of hydrogen as a natural gas alternative, alongside using North Sea offshore expertise to support the offshore wind sector. The ESS argues that there is no contradiction between the UK’s net zero commitment and its commitment to a strong and evolving North Sea industry, but rather that one depends on the other.

A recent class action refiled in federal court against Shopify highlights a growing trend  of lawsuits against companies related to the theft of cryptocurrency, particularly as a result of internal company threats.  See Forsberg et al v. Shopify, Inc. et al, 1:22-cv-00436 (D. Del.).  Despite not itself being a repository for or facilitating the sale of any cryptocurrency, the plaintiffs in the Shopify case allege that Shopify is liable for a theft of cryptocurrency after Shopify experienced a data breach caused by its own employees, which exposed a customer list for a cryptocurrency hardware wallet vendor, Ledger SAS.  As cryptocurrency storage and related transactions increasingly feature in companies’ online presence, there is likely to be a growing risk posed by threat actors motivated to target crypto-related assets and data, and more litigation activity in this space.

On 1 March 2022, the European Commission (“Commission”) published drafts of the revised Research & Development Block Exemption Regulation (“R&D BER”) and Specialization Block Exemption Regulation (“Specialisation BER”, together the “Horizontal Block Exemption Regulations” or “HBERs”) as well as the accompanying Horizontal Guidelines for stakeholder comments.  The current HBERs are due to expire on 31 December 2022.

The HBERs set out how competitors can work together on projects and enter into horizontal agreements without breaching collusion-related prohibitions.  During the Commission’s evaluation of the current HBER rules and horizontal guidelines, the Commission identified a number of areas for improvement, including the need to update the rules in line with the Commission’s policies on digitalization and sustainability (see our previous blog post here).

Three things for you to know about the recent amendments to the HBERs:

  • There is a strong focus on sustainability, and how sustainability agreements may comply with EU competition law, which provides greater scope for companies to enter into sustainability agreements (which is detailed in this blog post).
  • Data sharing and information exchange is at the forefront of the HBER update, with additional guidance on identifying and sharing commercially sensitive information and the use of algorithms.
  • The competition rules for research and development agreements and specialisation agreements have been explained and clarified, including new definitions of key competition terms (e.g., active and passive sales, unilateral specialisation agreements).
  • Courts across the country continue to grapple with thorny questions surrounding the legal implications of cyber-attacks.  Recently, a federal court in California considered whether a plaintiff could assert a claim against a company when a cyber-criminal acquired his personal information from the company and then used that information to steal his cryptocurrency.  The district court

    On 28 April 2022, the Subsidy Control Bill (the “Bill”) received Royal Assent, becoming the Subsidy Control Act 2022 (the “Act”).  The Act lays the basic framework for the new UK-wide subsidy control regime, which is now expected to come into force in Autumn 2022.  Although the Act primarily addresses UK public authorities and their legal obligations relating to the awarding of domestic subsidies, the new regime will be of particular interest to companies wishing to benefit from the more flexible post-Brexit subsidy regime moving forward.

    In a recent decision, the Seventh Circuit answered a key question in Rule 23 commonality analyses: whether at the certification stage plaintiffs need to establish the terms of an allegedly common policy, or only its mere existence.  Ross v. Gossett, — F.4th —-, 2022 WL 1421315 (7th Cir. May 5, 2022).

    The putative class consisted of all Illinois Department of Corrections inmates housed in April through July 2014 at four IDOC correctional centers.  They sued various IDOC officials for alleged constitutional violations stemming from prison-wide “shakedowns” executed by the defendants for purposes of sanitation and to discover and remove contraband.  They further alleged that the shakedowns were conducted pursuant to a single, unified policy across all four prisons. 

    This is the twelfth in a series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”).  The first blog summarized the Cyber EO’s key provisions and timelines, and the second through eleventh blogs describe the actions taken by various Government agencies to implement the Cyber EO from June 2021 through March 2022, respectively.  This blog summarizes key actions taken to implement the Cyber EO during April 2022.  As with the steps taken during prior months, the actions described below reflect the implementation of the EO within the Government. However, these activities portend further actions, potentially in or before June 2022, that are likely to impact government contractors, particularly those who provide software products or services to the Government.

    Nine million texts are sent daily in Ireland, a huge increase on when the first text was sent in 1992.  All are subject to the data retention and access regime currently in place under the Communications (Retention of Data) Act 2011.  That regime has now been given the kiss of death by the Court of Justice of the European Union (“CJEU”) in its recent decision on a referral by the Irish Supreme Court dealing with the validity of electronic communications evidence collected under it.

    The legislation, brought in to transpose EU Directive 2006/24, regulates the retention of data by electronic communications providers and access to that data by state authorities.