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Jersey’s autonomy is a fundamental part of the constitutional relationship between the island and the mainland. However, as the world becomes increasingly open for business, is it time to take stock? Sir Philip Bailhache takes a considered view


and some aspects of the relationship are not agreed. What we can say without fear of contradiction is that the story starts in 1204 with the loss of Normandy. We gained our autonomy from King John, who was anxious to secure the loyalty of Channel Islanders in his war against the French king and the first monarch to confer the privileges of self-government. Our ancestors have jealously guarded that autonomy


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for over 800 years. Jersey isn’t part of the UK, nor part of the EU. The essence of the relationship is that we are responsible for our internal affairs, and especially our fiscal affairs, while the UK is responsible for our international relations and for defence. With regard to the EU, our relationship is governed by Protocol 3 to the UK’s Act of Accession in 1972. Basically we are outside the European Union, although we are inside for the purpose of trade in goods. Some people assert that Jersey’s autonomy is a


mirage, and that ultimately the UK parliament can legislate for the island whether we like it or not. That was the view expressed by the Kilbrandon Commission in 1973. Many learned constitutional lawyers now consider that Kilbrandon is out of date, and that there is no longer (if there ever was) any legal justification for the proposition that the UK parliament has the ultimate power to legislate for Jersey – even on tax – against the wishes of the States.


Jersey and the UK The reality, of course, is that the UK parliament does not legislate for Jersey on domestic matters without the consent of the States. Every constitutional dispute over the centuries has so far been resolved without resorting to the untested weapon. On the other hand, the threat to legislate, even if the legal power is lacking, can be a potent weapon in the hands of bullies. But what about the other side of the coin – Jersey’s


power to legislate, which, in terms of primary legislation, requires the sanction of Her Majesty’s Privy Council? The official position is that the UK government scrutinises legislation for compliance with international law before passing it for Royal Assent. If the scrutiny


SK MOST people to define Jersey’s constitutional relationship with the UK and their eyes are likely to glaze over. They can be forgiven. The island’s constitution is unwritten,


were just for that purpose, there could be no legitimate cause for concern. The UK is responsible for us internationally, and


clearly must have the right to ensure that we don’t place the UK in breach of some international obligation. But that is not now the only purpose of Whitehall’s scrutiny. It is clear that it goes also to the question of whether there is any UK interest, which might be adversely affected. The classic example was the Finance Law passed by


the States on 20 January 1998, but not sanctioned by the Privy Council until three years later. The problem was the creation of the International Business Company (IBC). Guernsey and the Isle of Man already had IBCs and Jersey was just catching up. But unfortunately, the UK was in the midst of discussions with the OECD about tax havens and harmful tax regimes, and did not want to be seen to be approving such a concept at that time, and the Home Secretary refused to submit the law to the Privy Council. From the point of view of the UK, the political embarrassment was entirely understandable, but from Jersey’s perspective this was an important law, authorising, among other things, the collection of income tax for 1998. No breach of any international obligation was in question. To refuse to submit the draft law to the Privy Council was both unconstitutional and unlawful. It was only under threat of legal action that the Home Secretary eventually capitulated and that it was approved.


Moving the goalposts It is generally agreed that the UK’s greater engagement with Europe over the past 12 years has increased the pressure to which the Crown Dependencies have been subjected. This is not a criticism of the UK – it is a fact of life. The line between international affairs and domestic matters has become blurred. When Lord Rippon came to Jersey on 19 November


1971 to speak to the States about the arrangements that were to become Protocol 3, he gave members this assurance: “What I would like to emphasise, because I am sure it is of prime importance to you all, is this. Under the proposals, your fiscal autonomy has been guaranteed – I say that deliberately and slowly. There is no doubt whatsoever about that, and I can say quite categorically that there will be no question of your


June/July 2010 businesslife.je 11





JOHN DE GARIS


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