British government loses court case on how to trigger Brexit

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LONDON, Nov 3 (Reuters) - England's High Court ruled on Thursday that the British government requires parliamentary approval to trigger the process of exiting the European Union, a major upset for Prime Minister Theresa May's plans for Brexit.

Sterling rose on the news, with many investors taking the view that lawmakers would temper the government's policies and make an economically disruptive "hard Brexit" less likely.

RELATED: High Court rules UK lawmakers must vote on Brexit

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LONDON, ENGLAND - NOVEMBER 03: Founding partner of SCM Private LLP Gina Miller (C) leaves after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - NOVEMBER 03: Founding partner of SCM Private LLP Gina Miller speaks after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - NOVEMBER 03: Lawyer for Deir dos Santos, David Green (2L) speaks after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - NOVEMBER 03: Founding partner of SCM Private LLP Gina Miller speaks after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - NOVEMBER 03: Founding partner of SCM Private LLP Gina Miller (C) leaves after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
Financial entrepreneur Gina Miller, one of the claimants who challenged plans for Brexit, speaks to the media outside the High Court in London, Thursday Nov. 3, 2016. In a major blow for Britain's government, the High Court ruled Thursday that the prime minister can't trigger the U.K.'s exit from the European Union without approval from Parliament. (AP Photo/Tim Ireland)
LONDON, ENGLAND - NOVEMBER 03: Lawyer for Deir dos Santos, David Green speaks after the High Court decides that the Prime Minister cannot trigger Brexit without the approval of the MP's at The Royal Courts Of Justice on November 3, 2016 in London, England. Leading legal figures have been arguing the historic case after some MP's called for Parliament to be given a vote before article 50 is triggered. Their case is backed by investment manager Gina Miller and Article 50 author, Lord Kerr of Kinlochard. The announcement was made by Lord Chief Justice Lord Thomas, Master of the Rolls Sir Terence Etherton and Lord Justice Sales. (Photo by Dan Kitwood/Getty Images)
Business woman Gina Miller, one of the claimants who challenged plans for Brexit, speaks to the media outside the High Court in London, Thursday Nov. 3, 2016. In a major blow for Britain's government, the High Court ruled Thursday that the prime minister can't trigger the U.K.'s exit from the European Union without approval from Parliament. (AP Photo/Tim Ireland)
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The court said it had granted the government permission to appeal against the ruling before the Supreme Court, which has set aside Dec. 5-8 to deal with the matter.

A panel of three of the most senior judges in the country ruled that the government could not trigger Article 50 of the EU's Lisbon Treaty, the formal step needed to start negotiations on the terms of Brexit, without approval from parliament.

RELATED: Brexit results

"The court does not accept the argument put forward by the government," said Lord Chief Justice John Thomas, reading out the three judges' ruling.

"For the reasons set out in the judgment, we decide that the government does not have power ... to give notice pursuant to Article 50 for the UK to withdraw from the European Union."

International Trade Secretary Liam Fox said the government was disappointed with the court ruling and would consider it carefully before deciding how to proceed.

"The country voted to leave the European Union in a referendum approved by acts of parliament. The government is determined to respect the result of the referendum," Fox told parliament. (Additional reporting by Kylie Maclellan, writing by Estelle Shirbon)

RELATED: Brexit protesters in favor of staying in the EU

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Two activists with the EU flag and Union Jack painted on their faces kiss each other in front of Brandenburg Gate to protest against British exit from the European Union, in Berlin, Germany, June 19, 2016. REUTERS/Hannibal Hanschke
Anti-government demonstrators hold placards reading "No Brexit" during a protest outside the parliament in Athens, Greece June 15, 2016. REUTERS/Alkis Konstantinidis
A protestor uses a megaphone to address a crowd as they gather outside The Houses of Parliament to demonstrate against the European Union (EU) referendum result, in London, U.K., on Saturday, June 25, 2016. The U.K. voted to quit the European Union after more than four decades in a stunning rejection of the continent's postwar political and economic order. Photographer: Jason Alden/Bloomberg via Getty Images
A protestor holds a placard which reads 'YES 2 EU' to demonstrate against the European Union (EU) referendum result, outside The Houses of Parliament in London, U.K., on Saturday, June 25, 2016. The U.K. voted to quit the European Union after more than four decades in a stunning rejection of the continent's postwar political and economic order. Photographer: Jason Alden/Bloomberg via Getty Images
A protestor holding a European Union (EU) flag, addresses a crowd as he demonstrates against the European Union (EU) referendum result, in London, U.K., on Saturday, June 25, 2016. The U.K. voted to quit the European Union after more than four decades in a stunning rejection of the continent's postwar political and economic order. Photographer: Jason Alden/Bloomberg via Getty Images
A protest camp of people calling for a second referendum on Scottish independence, in Edinburgh, Scotland on June 25, 2016, following the pro-Brexit result of the UK's EU referendum vote. The result of Britain's June 23 referendum vote to leave the European Union (EU) has pitted parents against children, cities against rural areas, north against south and university graduates against those with fewer qualifications. London, Scotland and Northern Ireland voted to remain in the EU but Wales and large swathes of England, particularly former industrial hubs in the north with many disaffected workers, backed a Brexit. / AFP / OLI SCARFF (Photo credit should read OLI SCARFF/AFP/Getty Images)
A demonstrator holds a placard that reads 'So Long Great Britain' during a protest against the pro-Brexit outcome of the UK's June 23 referendum on the European Union (EU), in central London on June 25, 2016. The result of Britain's June 23 referendum vote to leave the European Union (EU) has pitted parents against children, cities against rural areas, north against south and university graduates against those with fewer qualifications. London, Scotland and Northern Ireland voted to remain in the EU but Wales and large swathes of England, particularly former industrial hubs in the north with many disaffected workers, backed a Brexit. / AFP / JUSTIN TALLIS (Photo credit should read JUSTIN TALLIS/AFP/Getty Images)
A demonstrator holds a placard during a protest against the pro-Brexit outcome of the UK's June 23 referendum on the European Union (EU), in central London on June 25, 2016. The result of Britain's June 23 referendum vote to leave the European Union (EU) has pitted parents against children, cities against rural areas, north against south and university graduates against those with fewer qualifications. London, Scotland and Northern Ireland voted to remain in the EU but Wales and large swathes of England, particularly former industrial hubs in the north with many disaffected workers, backed a Brexit. / AFP / JUSTIN TALLIS (Photo credit should read JUSTIN TALLIS/AFP/Getty Images)
LONDON, ENGLAND - JUNE 25: A small group of young people gather to protest on Parliament Square the day after a majority of the British public voted for leaving the European Union on June 25, 2016 in London, England. The ramifications of the historic referendum yesterday that saw the United Kingdom vote to Leave the European Union are still being fully understood. The Labour leader, Jeremy Corbyn, who is under pressure from within his party to resign has blamed the 'Brexit' vote on 'powerlessness', 'austerity' and peoples fears over the issue of immigration. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - JUNE 25: A small group of young people gather to protest on Parliament Square the day after a majority of the British public voted for leaving the European Union on June 25, 2016 in London, England. The ramifications of the historic referendum yesterday that saw the United Kingdom vote to Leave the European Union are still being fully understood. The Labour leader, Jeremy Corbyn, who is under pressure from within his party to resign has blamed the 'Brexit' vote on 'powerlessness', 'austerity' and peoples fears over the issue of immigration. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND - JUNE 25: A small group of people gather to protest on Parliament Square the day after the majority of the British public voted to leave the European Union on June 25, 2016 in London, England. The ramifications of the historic referendum yesterday that saw the United Kingdom vote to Leave the European Union are still being fully understood. The Labour leader, Jeremy Corbyn, who is under pressure from within his party to resign has blamed the 'Brexit' vote on 'powerlessness', 'austerity' and peoples fears over the issue of immigration. (Photo by Matt Cardy/Getty Images)
LONDON, ENGLAND - JUNE 25: A small group of young people gather to protest on Parliament Square the day after a majority of the British public voted for leaving the European Union on June 25, 2016 in London, England. The ramifications of the historic referendum yesterday that saw the United Kingdom vote to Leave the European Union are still being fully understood. The Labour leader, Jeremy Corbyn, who is under pressure from within his party to resign has blamed the 'Brexit' vote on 'powerlessness', 'austerity' and peoples fears over the issue of immigration. (Photo by Dan Kitwood/Getty Images)
Demonstrators hold placards during a protest against the outcome of the UK's June 23 referendum on the European Union (EU), in central London on June 25, 2016. The result of Britain's June 23 referendum vote to leave the European Union (EU) has pitted parents against children, cities against rural areas, north against south and university graduates against those with fewer qualifications. London, Scotland and Northern Ireland voted to remain in the EU but Wales and large swathes of England, particularly former industrial hubs in the north with many disaffected workers, backed a Brexit. / AFP / JUSTIN TALLIS (Photo credit should read JUSTIN TALLIS/AFP/Getty Images)
LONDON, ENGLAND - JUNE 25: A small group of people gather to protest on Parliament Square the day after the majority of the British public voted to leave the European Union on June 25, 2016 in London, England. The ramifications of the historic referendum yesterday that saw the United Kingdom vote to Leave the European Union are still being fully understood. The Labour leader, Jeremy Corbyn, who is under pressure from within his party to resign has blamed the 'Brexit' vote on 'powerlessness', 'austerity' and peoples fears over the issue of immigration. (Photo by Dan Kitwood/Getty Images)
LONDON, ENGLAND- JUNE 24: Young protesters demonstrate outside Downing Street, following the United Kingdom's decision to leave the EU following the referendum, on June 24, 2016 in London, England. The result from the historic EU referendum has now been declared and the United Kingdom has voted to LEAVE the European Union. (Photo by Mary Turner/Getty Images)
A boat flying a large 'In' flag, campaigning to remain in the EU in the upcoming referendum sails by the British Houses of Parliament to meet a flotilla of boats from the group 'Fishing for Leave' on the river Thames in London on June 15, 2016. A Brexit flotilla of fishing boats sailed up the River Thames into London today with foghorns sounding, in a protest against EU fishing quotas by the campaign for Britain to leave the European Union. / AFP / NIKLAS HALLE'N (Photo credit should read NIKLAS HALLE'N/AFP/Getty Images)
A boat flying a large 'In' flag, campaigning to remain in the EU in the upcoming referendum sails by the British Houses of Parliament to oppose a flotilla of boats from the group 'Fishing for Leave' (L) on the river Thames in London on June 15, 2016. A Brexit flotilla of fishing boats sailed up the River Thames into London today with foghorns sounding, in a protest against EU fishing quotas by the campaign for Britain to leave the European Union. / AFP / NIKLAS HALLE'N (Photo credit should read NIKLAS HALLE'N/AFP/Getty Images)
A boat carrying supporters for a ' remain' vote in the EU referendum including Irish singer Bob Geldof (C) shout and wave at fishing boats supporting a 'leave' vote as they sail on the river Thames in central London on June 15, 2016. A Brexit flotilla of fishing boats sailed up the River Thames into London today with foghorns sounding, in a protest against EU fishing quotas by the campaign for Britain to leave the European Union. / AFP / NIKLAS HALLE'N (Photo credit should read NIKLAS HALLE'N/AFP/Getty Images)
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