Graham John Wheeler: The British Overseas Territories and “Direct Rule”

Graham John WheelerIn the wake of the Mossack Fonseca affair, there have been calls for London to impose “direct rule” on some of the British Overseas Territories which are used for offshore financial purposes.

This blog post does not take a position on the merits of this proposal. Instead, it seeks to highlight two constitutional points which arise in this regard. First, the Territories’ powers of self-government are already relatively circumscribed in legal terms. Second, there is no developed set of doctrines determining when it might be appropriate for the British Government to intervene more closely in the Territories’ governance.

The Territories and their Constitutional Position

The Territories are the last remnants of the former British Empire. There are 14 of them, and they are listed in Schedule 6 of the British Nationality Act 1981. They comprise:

  • Anguilla
  • Bermuda
  • The British Antarctic Territory
  • The British Indian Ocean Territory
  • The Cayman Islands
  • The Falkland Islands
  • Gibraltar
  • Montserrat
  • Pitcairn, Henderson, Ducie and Oeno Islands
  • St Helena, Ascension and Tristan da Cunha
  • South Georgia and the South Sandwich Islands
  • The Sovereign Base Areas of Akrotiri and Dhekelia
  • The Turks and Caicos Islands
  • The Virgin Islands

The Territories form a single undivided realm under the Crown.  When decisions concerning them are taken in London, the Crown acts through the Foreign and Commonwealth Office (FCO). They are distinct from the Crown dependencies of Jersey, Guernsey and the Isle of Man, which have a different constitutional status (deriving from the historic engagements of the Crown rather than the British Empire).

Two legal challenges to the dependent status of the Territories have been before the courts in the last ten years. The first arose out of the well-publicised child abuse proceedings relating to Pitcairn (R v Christian [2006] UKPC 47). The second related to the Turks and Caicos Islands, which are discussed in more detail below.

A 2012 White Paper summarised the constitutional position of the Territories:

“As a matter of constitutional law the UK Parliament has unlimited power to legislate for the Territories…. Governors or Commissioners are appointed by Her Majesty The Queen on the advice of Her Ministers in the UK, and in general have responsibility for external affairs, defence, internal security (including the police) and the appointment, discipline and removal of public officers….

The Government maintains the UK’s long-standing position on independence for the Territories. Any decision to sever the constitutional link between the UK and a Territory should be on the basis of the clear and constitutionally expressed wish of the people of the Territory. Where independence is an option and it is the clear and constitutionally expressed wish of the people to pursue independence, the UK Government will meet its obligations to help the Territory to achieve it.”

Within this general framework, the White Paper stated that “powers are devolved to the elected governments of the Territories to the maximum extent possible consistent with the UK retaining those powers necessary to discharge its sovereign responsibilities.”

It would therefore be fair to say that the default position is that the Territories will have internal self-government – but this is only a default position, and it does not necessarily extend to matters relating to external affairs, security and public appointments. It should also be noted that the Judicial Committee of the Privy Council serves as the final court of appeal for all of the Territories, and that they come within the supervisory jurisdiction of the High Court (R v SoSFCA ex parte Quark Fishing Ltd [2005] UKHL 57, para. 65).

As the block quotation above shows, the UK recognises in principle the Territories’ right to self-determination. The same recognition appears in a 2014 communiqué and a more recent Government policy paper from 2015. A right to self-determination is also asserted in the constitutions of the Cayman Islands, Gibraltar, Montserrat, St Helena and the Virgin Islands. The UK can therefore no longer be correctly described an imperial power in respect of the Territories. Its recognition of the right to self-determination would seem to be consistent with the various UN anti-colonial instruments and Article 1 of the International Covenant on Civil and Political Rights (see also para. 29 of the ICJ’s judgment in East Timor (Portugal v Australia) [1995] ICJR 90).

Nevertheless, while the current constitutional arrangements continue, the UK has considerable legal scope for involvement in the governance of the Territories: the limits on London’s freedom of action lie in the realm of custom and convention rather than that of law.

The Territories’ Constitutions

Each of the Territories has a written constitution – in most cases, these have been adopted in the course of the present century, following the initiation in 1999 of a programme of constitutional modernisation.

The constitutions are enacted through the medium of Orders in Council. Most of the Orders are made under a mixture of statutory and prerogative powers, although those of Anguilla and Bermuda are made under statutory powers alone and those of Gibraltar and the British Indian Ocean Territory are made under prerogative powers alone.

Consistently with the general default principle of self-government, most of the Territories have a local legislature which is partially or wholly elected. A few do not. This is the case with South Georgia, the British Antarctic Territory, the British Indian Ocean Territory and the Sovereign Base Areas.

The Territories’ constitutional autonomy is qualified. The constitutions regularly contain reservations allowing the Crown a continuing right to legislate by Order in Council (albeit such Orders may be subject to judicial review: R (Bancoult) V SoSFCA (No 2) [2008] UKHL 61). For example, Section 125 of the Constitution of the Cayman Islands states: “There is reserved to Her Majesty full power to make laws for the peace, order and good government of the Cayman Islands.” This effectively means that the constitutions exist side-by-side with a concurrent right on the part of London to legislate directly for the Territories. To this extent, “direct rule” already exists.

The constitutions also state explicitly that the local Governor may or must withhold assent from, or report back to London on, certain items of local legislation. Similar provisions may be found in Royal Instructions, or in instructions from the Secretary of State issued to the Governors. The scope of these provisions differs considerably. The Constitution of the Falkland Islands requires the Governor to refer to London only bills which he believes to be inconsistent with the constitution. By contrast, Section 33(2) of the Constitution of Gibraltar expressly states that the Governor may refuse assent to “any  bill  which  appears  to  him…  to  be  in  any  way  repugnant  to  good  government…”. The Constitution of St Helena goes into greater detail. Section 74(3) provides that the Governor must report back to London on any bill which appears to him:

“(a) to be inconsistent with one or more of the partnership values declared in section 2;

(b) to be repugnant to or inconsistent with this Constitution; or

(c) to determine or regulate the privileges, immunities or powers of the Legislative Council or its Members.”

The “partnership values” are in turn defined in broad terms as:

“(a) good faith;

(b) the rule of law;

(c) good government;

(d) sound financial management;

(e) the impartial administration of justice;

(f) the impartiality of the St Helena Public Service;

(g) the maintenance of public order;

(h) compliance with applicable international obligations of the United Kingdom and of St Helena; and

(i) the maintenance of international peace and security and the right of individual or collective self-defence.”

The Territories’ powers of self-government are therefore not, and never have been, unlimited. From this perspective, “direct rule” does not necessarily amount to a major legal or constitutional step – although it might, of course, be a politically more difficult one.

Two Precedents

  1. The Invasion of Anguilla

One of the more colourful episodes in Britain’s retreat from empire was the invasion of the Caribbean island of Anguilla on 19 March 1969. At this time, Anguilla was part of the larger Territory of Saint Christopher-Nevis-Anguilla (SCNA). There was discontent with being part of this larger unit, and an attempt was made to unilaterally declare the island independent as the “Republic of Anguilla”. A British official, William Whitlock, was forcibly expelled from the island.  The Wilson administration took a dim view of this. They sent in another administrator, Tony Lee, and thoughtfully equipped him with a battalion of paratroopers. Lee took with him an Order in Council under which he was given broad emergency executive powers: the Anguilla (Temporary Provision) Order 1969. This was later firmed up by a UK statute, the Anguilla Act 1971. When the dust settled, Anguilla ended up becoming (in 1980) a self-governing Territory in its own right.

This is a problematic precedent for a couple of reasons. First, the British Government’s actions were undertaken with the blessing of the elected government of SCNA, which was still de jure in charge of Anguilla. Second, the intervention was criticised even at the time. The British Government claimed that it was necessary in order to enable the UK to discharge its responsibilities for Anguilla’s defence and external affairs – yet the the island’s problems could more naturally be regarded as amounting to an internal political dispute. It was also argued that the 1969 Order gave Mr Lee unduly wide powers. The then Leader of the Opposition, Ted Heath, went so far as to suggest that the Order was ultra vires of its enabling statute (the West Indies Act 1967).

There is therefore little to be learnt from this unusual episode.

  1. The Turks and Caicos Islands

The most recent example of “direct rule” came in the Turks and Caicos Islands between 2009 and 2011. The British Government decided to suspend parts of the constitution (albeit not all of it: notably, the chapter on fundamental rights remained in force). A subsequent legal challenge by the deposed premier met with failure (R (Misick) v SoSFCA [2009] EWCA Civ 1549). In this case, “direct rule” is something of a misnomer, as the public powers over the Territory were vested in the Governor rather than being transferred to London.

Explaining the decision to intervene, the relevant Parliamentary Under-Secretary of State at the FCO reported to Parliament that a commission of inquiry had found “a high probability of systemic corruption or serious dishonesty”, together with “clear signs of political amorality and immaturity and of general administrative incompetence”.

This collection of problems – and perhaps even any of them individually – arguably provided sufficient grounds to justify intervention by London. However, the opportunity does not seem to have been taken to set out in detail the grounds on which the British Government will seek to fully assert its sovereignty over a Territory. It may be that the current controversy will provide a new opportunity for clarification in this regard.

Graham John Wheeler is a solicitor (England and Wales, Republic of Ireland) and an independent researcher.

(Suggested citation: G.J. Wheeler, ‘The British Overseas Territories and “Direct Rule”’, U.K. Const. L. Blog (12th Apr 2016) (available at