The Future Lawyer Weekly Update – w/c 1st February

The round-up of the stories that a budding Student Lawyer should be aware of this week. Sign up here to get these updates in your inbox every week.

Legal Action

HS2 Tunnellers start legal action against safety regulators

Reported by Ellena Mottram

Environmental activities have launched legal action against safety regulators who are attempting to evict them from a series of tunnels dug under Euston Station.

It emerged last week individuals who had set up a Tree Protection Camp in Euston Square Gardens, in protest of the HS2 rail project, had dug tunnels near Euston station in an attempt to prevent their eviction from the camp.

The camp was originally set up in September 2020 to protest the high-speed rail link which is designed to link London, Birmingham, Manchester and Leeds. Once complete the link will terminate at Euston Station. The activists argue the small green space close to Euston station will not be kept intact but will instead be replaced by a taxi rank before it is sold to developers as part of plans for HS2.

In an attempt to being evicted members of the group claim to have dug a system of tunnels approximately 100ft long without being detected by police or other security forces. It is understood there are nine protestors in the tunnel who bailiffs, working for the £106bn rail project, are not trying to evict.

Supports of the activities however argue the way in which the bailiffs are trying to evict those in the tunnels is putting their lives at risk. It is argued the eviction team have caused five internal collapses and liquid mud to pour into the tunnel. HS2 however argue that it is the activist themselves who are putting their own lives at risk by staying in the tunnel whilst the eviction work continues.

As a result of the activities accusations, they have begun emergency legal action against the Health and Safety Execution. The action calls in HSE to inform the activists’ legal team of the safety measures being taken to ensure the protesters, both those above and below ground. They argue this information ought to be provided immediately.

The protesters argue that it is HSE who have overall responsibility for the safety f the site, overseeing the actions of both the protestors and HS2. The protestors want information about the actions taken by HSE such as how many times they have visited the site and what guidance and direction they have given.

Counsel for the protestors, John Cooper QC, has asked for documentation on the risk assessment of the eviction setting a deadline by midday on Sunday 31 January. A failure to meet the deadline could lead the protestors to seek a protection order from the courts.

In response HS2 however again accused the protestors of putting their own lives at risk stating ‘We are concerned that the occupants of the tunnel are now impeding efforts to help them, shutting themselves off underground, and preventing us from checking air quality as we supply them with air.
As carbon dioxide can build up in the tunnel, they are putting themselves in even greater danger’.

You can find more here.

Trade Agreement

UK to apply to join Trans-Pacific trade group

Reported by Jasmine Cracknell

The UK government has announced it will be applying to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a trade agreement founded in 2018 by 11 Pacific Rim countries.

The current members of the trade group are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The UK would be the first non-founding country to join.

The CPTPP is a free trade agreement which aims to reduce import charges and tariffs on goods by 95%. Where products and goods contain materials from outside of the bloc, manufacturers can still claim ther product satisfies the ‘rules of origin’ requirement if at least 70% of the components are sourced from the member countries.

The government claims CPTPP membership would put the UK "at the centre of a modern, progressive network of free trade agreements with dynamic nations”, however critics are sceptical about exactly how beneficial joining the trade group would be. One reason for this is that the CPTPP nations accounted for only 8.4% of UK exports in 2019, which is almost the same level of exports made to Germany alone. The UK also has trade deals with several CPTPP countries already, and is currently in talks with Australia and New Zealand, so some have questioned how much added value joining the CPTPP would bring.

It is believed the benefits of the CPTPP would be much greater if the USA joined the group, as this could allow the UK to secure a trade deal with the US through the ‘back door’. The US was in talks to join the group before former President Donald Trump pulled out, however President Joe Biden has not yet confirmed his intention to join. If the US were to join, the trade group would then account for more than 40% of global GDP, much higher than its current 13.4%.

Shadow International Trade Secretary, Emily Thornberry, said Labour will be closely scrutinising the deal: “Like any other trade agreement, the advantages of joining the CPTPP will have to be assessed once we see the terms on offer,”

“At present, Liz Truss cannot even guarantee whether we would have the right to veto China’s proposed accession if we join the bloc first.”

The International Trade Secretary, Lizz Truss, will formally request to join the CPTPP on Monday, with formal negotiations set to start in the spring.

Find out more here and here.

Covid-19: Vaccine

Pharmaceutical companies vaccine supply and the EU

Reported by Laurence Tsai

AstraZeneca (“AZ”) recently announced a delay in their delivery of Covid-19 vaccines to the European Union (“EU”)’s 27 nations. Owing to problems at its Belgian factory, AZ announced it would deliver 31 million doses for the first quarter, rather than the anticipated 80m (a 60% shortage in vaccine supplies to the EU). The EU has announced it may take legal action against AZ.

• AstraZeneca’s contracts

1. 1. Signed with the UK in June 2020 for 100m doses of the Covid-19 vaccine, which AZ is currently trying to fulfil.
   2. Signed with the EU Commission (“the Commission”) in August 2020 for 400m doses. The Commission negotiated a lower price than the UK and USA. The agreement is governed by Belgian law.

• The EU’s rationale

Due to AZ’s Belgian plant debacle, the EU demands that AZ diverts at least 50m vaccine doses from its UK factory to the EU to compensate for its supply issues. Commission president, Ursula von der Leyen, believes AZ’s contractual obligation to do so is “crystal clear”, reinforced by AZ’s explicit assurance that no other obligations to third parties would prevent AZ from fulfilling this contract. The clause reads as follows: “AstraZeneca shall use its Best Reasonable Efforts to manufacture the vaccine at manufacturing sites located within the EU (which for the purpose of this Section 5.4 only shall include the United Kingdom)”.
Accordingly, the Commission is confident in its legal position – that AZ must supply the bloc with vaccines developed from four manufacturing sites, which includes its UK plant.

Brussels published it’s a redacted version of its 41-page contract with AZ to demonstrate AZ’s contractual obligation to send the vaccines developed in its UK factories to the EU to help with supply issues. However, the headings of the redacted sections could still be viewed in the bookmarks bar. Therefore, on top of the supply shortage, the EU may have inadvertently breached its confidentiality obligations.

• AstraZeneca’s response

AZ opposes the EU’s argument that it must supply the EU with vaccines concurrently with when it supplies the UK. the contract only specifies its obligation to make “best reasonable efforts”; AZ is not compelled to meet the contract’s non-specified delivery targets. The defined term, “best reasonable efforts” takes into account “the urgent need for a vaccine to end a global pandemic”.

Understandably, AZ only agreed to make best efforts to meet the EU’s delivery schedule (specified in quarters, not years), because it would not have been commercially prudent to contractually bind itself to these delivery targets for a new product.

• Views from legal commentators

Benjamin Haberkorn, partner at Eversheds Sutherland in Brussels, comments that the Commission must prove AZ failed to meet “normal standards of professional diligence”. One wonders whether a Belgium court would follow “normal standards of professional diligence” during unprecedented times, and where the contract explicitly considers the “serious public health issues, restrictions on personal freedoms and economic impact, across the world”.

Others have advanced the view that AZ cannot rely on a ‘first come, first served’ mentality simply because it signed its contract with the UK earlier. Conversely, there is an argument to be made that because the EU signed its contract much later, and negotiated a lower price, AZ and pharmaceutical companies don’t have an incentive to speed up production. Therefore, the EU should pay a premium for any doses delivered early, taking into account the additional costs incurred for increased production flow.

Most commentators and lawyers agree that it is more likely that this dispute will be settled by arbitration because any court case would be far too drawn-out to address the immediate jab shortfall the EU faces.

• Two avenues the EU has explored to combat the shortfall

1. 1. Publicly communicated its willingness to commence legal action against AZ so that it feels pressured to divert its UK doses to its 27 nations.
   2. Implemented export controls to prevent Pfizer’s doses (based in Belgium) from leaving the EU. This measure applies from 30 January 2021 until 31 March 2021.

• The EU’s export control measures

Concerning the UK and Northern Ireland, the EU had initially had proposed to trigger an emergency clause in the Brexit withdrawal treaty that would have created border restrictions between the Republic of Ireland and Northern Ireland. Soon after publication, the EU faced backlash, prompting it to retract its unilateral proposal and engage in diplomacy.

On a global scale, the EU has organised new controls that would mandate pharmaceutical companies to reveal the details of exports. Manufacturers must provide early notification and obtain authorisation from the Commission before shipping Covid-19 vaccines outside the EU.

The EU also created a closed list of over 100 countries that will be exempt from these tighter export rules, claiming that these countries were ‘carved-out’ because they did not have their own production facilities, or had some degree of integration into the single market.

• Criticisms of the new measures

The International Chamber of Commerce, which represents over 45 million businesses worldwide argued that this limit could “rapidly erode essential supply chains”. From the outset of the pandemic, there was a rapid proliferation of trade barriers on personal protective equipment, negatively impacting the already harsh crises facing several national health systems. As a result, the EU’s measures would likely result in a devastating impact on global vaccine supplies. Indeed, some countries have criticised the EU for stimulating a vaccine war.

Mr Valdis Dombrovskis, EU trade commissioner, states that the instrument is intended to ensure “transparency and proportionality” and to make sure countries obtained the vaccines.
A major concern is that the new measures would empower the Commission and Member States to block vaccine shipments from manufacturers from which the EU has ordered supplies until it has satisfied demand within the bloc. The Commission has secured advance orders for up to 2.3 billion vaccine doses for the EU’s 446 million population. Ms von der Leyen conveyed that the bloc will share the vaccines it does not need for its own inhabitants, so it is likely that these inoculations would (and should) first go to countries that do not have enough for themselves. A potential knock-on effect of the measure is that governments may become more nationalistic over vaccines, which is something nobody would want.

You can find more here or here.