Labour's plans for energy and medicines – public law analysis

We have published two papers which consider the impact of the Labour Party's recently announced policies on two heavily regulated sectors, namely the energy and pharmaceutical industries. The policies proposed in relation to both sectors, which are similar to those now also proposed in other industries (such as the water industry and in relation to Royal Mail) are central aspects of Labour’s nationalisation agenda. Taking forward such policies would engage key public law principles and would give rise to likely challenges on the basis of the level of compensation payable, amongst other things.

In Labour's recent report entitled “Medicines for the Many”, Labour has proposed using existing powers of “Crown Use” and “compulsory licenses” to acquire patented information for the state’s purposes. Labour’s report also suggests that a future Labour government would seek to limit the basis on which compensation would be payable to holders of such patents. In addition to concerns which these proposals raise under intellectual property and investment treaty law, they give rise to questions about the compatibility of such measures with the right to property, which is protected by the common law, the EU Charter, and the European Convention on Human Rights (as incorporated into domestic law by the Human Rights Act 1998). For more information please see our briefing paper here.

Similarly, in its manifesto, the Labour Party has set out in more detail the measures which it proposes in relation to the energy industry. Broadly these measures would involve the nationalisation of significant parts of the energy sector (including the network companies and the energy supply businesses of the Big Six). As with its medicines proposals, if a future Labour government sought to implement these policies, we envisage challenges being brought on public law and human rights grounds given that they would involve interference with the companies’ and investors’ property. For more information on these issues, including in relation to steps that can be taken to protect property rights, please see our briefing paper here.