Examination of Witnesses (Questions 40
- 57)
WEDNESDAY 25 APRIL 2001
MR MICHAEL
CROWLEY, MS
JULIA SAUNDERS,
MS SARAH
MEEK AND
DR IAN
DAVIS
Chairman
40. We need to go on to the other major part
of your memorandum. I will wrap up on end use. As I understand
it, ministers can revoke licences on the grounds that there has
been a misuse of end use now. Government has existing power to
do that, does it not? We have seen examples of this. (Ms
Meek) That is our interpretation. Our hope is that this Bill
as we interpret it also contains those powers, although they are
not explicit; there are no explicit powers as I read the Bill
to do that. This is a new opportunity. This is the opportunity
to revise legislation that is 62 years old and we are looking
at how to do that best. The opportunity to do that best is go
give Government power that perhaps is not used at the moment but
it should consider using in the future. That includes end use.
41. I was very interested in your footnote in
your memorandum of the Belgian example. Historically I had never
thought of Belgium as the best model to follow. Besides the fact
that you draw our attention to this interesting comparison, has
it worked? Do we know that? Are the Belgians a model in this respect? (Dr
Davis) I think it has worked. Strangely enough, I had to give
evidence to the select committee in Belgium two years ago. Of
course the scale and dimension of the export in Belgium is very
different to what we have here, so that is another consideration.
I guess it is easier for them to deal with a relatively small
number of cases. Our understanding is that they have been relatively
successful.
Chairman: We will turn to licensed production.
Mr Berry
42. Licensed production of course is anther
way in which existing arms controls can be circumvented in quite
a straightforward manner. What is less straightforward I guess
is how licensed production overseas could be controlled. We now
have consultation document proposals from government that were
not there before, and you have commented on those. Can you briefly
summarise your view as to the best way in which this obvious problem
can be brought under control? (Mr Crowley) Firstly,
we recognise and commend the Government for itself recognising
that there is a problem with licensed production and attempting
to go part way in seeking to solve that. Our recommendation for
control is in essence that UK companies seeking to establish a
licence production agreement with other companies overseas have
to get government permission and licensing before such an agreement
comes into effect and that the criteria by which the Government
would determine whether such a licence should or should not be
given for that licence production agreement would be, firstly,
whether the licence production agreement is likely to lead to
the provision of arms or arms equipment that would be either used
in the licensee's home country for human rights violations or
could be exported to another country for human rights violations;
in effect, whether the UK Government would allow a direct export
of arms to that country or whether that would be refused on human
rights grounds. That determination has to be made. Such licence
production agreements must ensure that there are stringent controls
on the level of production of arms equipment. Such licence production
agreements should also have a no re-export provision, unless Her
Majesty's Government allows or agrees such a re-export. For example,
if there is a licence production agreement with a company in Turkey
for the production of sub-machine guns, the numbers of sub-machine
guns to be produced must be part of the licence production agreement
and there also must be a provision by which that Turkish company
or the Turkish Government has to come to the UK Government and
request permission to export such weapons to a third country.
43. The example of Turkey is a good one, given
it has happened. I can see that this may well deter a UK company
from establishing a subsidiary overseas to export arms from Turkey
to a third country. Does not the whole process here of actually
licensing the production agreement subject to end-use conditions,
which brings us back to the previous point, become ever more complex?
Can you give any examples of where such a regime has had the outcome
that no doubt we all want? (Mr Crowley) The US has
such a control system for licensed production agreements with
US companies and companies overseas. The level of armament production
is strictly defined and also there is a no re-export clause without
agreement by the US State Department. So that happens. (Ms
Meek) The principle of the US law is slightly different which
is that licensed production is established for the purpose of
that country only for the use of that country where the licence
is established. We have a different situation with other countries,
the European countries, in terms of licensed production. The idea
is that it is actually an extension of the production facility
of the parent company that then opens up new markets. So it is
a slightly difficult comparison to make on other best practice
because the preconditions are very different. I think what we
are saying is that we as a collective are saying that we want
our export controls to be rigorous; we want it to be clear that
there are transparent procedures to be followed; and when things
are outside those procedures that they are illegal or criminal.
I think that it is almost tautological to then say that licensed
production is exacting that same standard or rigour. I think that
is what Michael was saying about encompassing it into a licensing
procedure within the UK. That might be a few years down the line.
We are not necessarily there yet. I think we are also considering
more immediate proposals that would allow us to gain more information
about licence production because it was very difficult to gain
information on the number of facilities, the amount of equipment
being produced and where it was being exported. There are powers
in this Bill for example about the ability of the government to
request information from manufacturers. We would like that to
be extended so that those manufacturers would also have to supply
information on their licensed production facilities and the amount
of equipment those facilities were producing and how those recipients
of that equipment were using it. That is one example of a short-term
measure that could be put in place.
44. Could I quickly ask on the US example: is
there robust research evidence that suggests that that regime
works effectively, or is the evidence that it is not too difficult
to circumvent? (Ms Meek) The US has a policy on its
weapons. As you know very well, it has re-export conditions so
that it has to be notified if the weapons it sells and produces
under licence are re-exported. Unfortunately, the United States
also has a policy of honouring armed opposition groups and they
have occasionally used licence production facilities to arm such
opposition groups. So it is very hard to say concretely black
and white: "Yes, it has worked" or, "no, it has
not".
Mr O'Neill
45. Is it not also a product of the American
impression of themselves, that they have the right to interfere
in the affairs of other countries for whatever reason they see
fit? (Ms Meek) I think we are here to discuss the Export
Control Bill.
46. The fact is that you have got to look at
the assumptions upon which this legislation in other countries
is based, that it may not be quite the same as the assumptions
on which we are operating. (Ms Meek) What I said was
exactly that, which is that I do not think the presumption of
the US system is necessarily applicable to European countries
which have undertaken licensed production.
47. Therefore, the US example may not be relevant
to this Act or a justification for a British position being adopted
along similar lines? (Ms Meek) I think that is what
I said, yes.
Mr Worthington
48. Can I look at this licensed production overseas
issue? The Government is saying it does not want to have this
licensed production undermining embargoes to which the UK is a
party. You say that it is vital that transfers of arms are controlled
to human rights and conflict crisis zones which are not subject
to international embargoes. Could you give us a list of countries
to which you would extend the effect of an arms embargo? (Dr
Davis) I do not think it is a question of extending an arms
embargo but of ensuring that the criteria and things like UK national
export criteria and the criteria in the UK code of conduct would
also apply to these situations. There would be grey areas which
again would depend on the type of equipment and be sensitive to
the destination. I am not suggesting that all countries be excluded.
49. It is not a true list of countries? (Mr
Crowley) The idea that we are proposing is that you use the
same criteria for determining whether you are going to grant a
direct export of arms to a country as for determining whether
you are going to allow the licensed production agreement to take
place. It is the same process. We commend the Government for recognising
the need to prevent licensed production activities to embargoed
countries, but that is not far enough. It should also ensure that
licensed production activities do not facilitate human rights
violations.
The way that it can do that is by using the
same criteria it uses for direct arms export controls to licensed
production facilities.
50. I am asking about countries that would be
swept in by your provisions. (Ms Saunders) There is
currently no UN arms embargo, for example, against the DRC (Democratic
Republic of Congo). Surely we will agree here that that would
not be a suitable destination for licence production exports.
51. We do, but there is a UN arms embargo. (Ms
Saunders) No, there is not.
52. There is not? I do not think it is all that
clear what is an embargo. (Ms Saunders) There is a
UN embargo and, of course, there is an EU and OSCE embargo or
unilateral decisions. It is only, really, the UN embargo which
has the strongest international powers and even they are very
hard to enforce. So it needs to be brought down to the level of
national legislation.
53. So the DRC you would include. What else? (Ms
Saunders) I think it is also a question of end-users. There
would be some countries where you might think that a particular
end-user may be a police force known as a human rights' abuser
whereas the army is not. You have to be quite sophisticated in
your judgments.
54. If you are going to be sophisticated you
have got to be simple to start with. That means which countries
are we talking about? (Dr Davis) I think the simple
principle is that we want to ensure that overseas licensed producers
do not export arms manufactured under a UK licence to destinations
to which the UK would not permit direct arms exports. It is ensuring
the principles are the same. For example, the one case that we
have had is in Turkey where a Turkish company exported 500 sub-machine
guns to the Indonesian Police and it was manufactured by Heckler
and Koch at the time which was owned by a UK company. This was
shortly after the UK Government had rejected an application for
a British company to export similar weapons to Indonesia. It is
ensuring that that situation does not apply. That will depend
on a case-by-case basis. (Ms Saunders) There is also
actually an interesting starting point for this, which is the
list of countries of concern which comes at the end of the annual
report. That would be my suggested starting point.
55. There is another sentence in your evidence
where you say that the indications are that unscrupulous exporters
are locating production of arms outside the UK and EU in order
to avoid strict controls. Can you produce that evidence? (Dr
Davis) There is the Turkish example, but I am not— (Ms
Saunders) There is also the example of armoured personnel
carriers being produced in the Philippines which are modified
from being defensive to offensive vehicles and they have been
used in conflict in human rights abuses. (Mr Crowley)
Similarly, there is the case of Ottokar in Turkey, where 70 per
cent of it is based on a Land Rover design, and Ottokar in the
past have exported such armoured personnel vehicles to Pakistan
and also to Algeria.
56. Would it be possible for you to fill out
what you have put there and give us a bit more evidence on this
one? (Mr Crowley) Yes, absolutely.
Mr Khabra
57. Do you agree that one of the solutions to
the problem of support of arms could be prior Parliamentary scrutiny
of export departments by a Committee such as this? (Ms
Meek) Yes. I think we have shown quite a bit of support for
the suggestions of the QSC that it be given a role in prior Parliamentary
scrutiny. I think we generally support the recommendations contained
in your most recent report of 6 March. Obviously we, as well as
yourselves, are trying to find constructive, perhaps, solutions
to the log-jam, if you like, with Government on the proposals,
but we see it as an important role. Also, we are pleased that
a lot of what is proposed in this draft Bill in terms of review
of secondary legislation has been put on a statutory footing as
well, so there is a continuing role for a Select Committee on
this issue. (Ms Saunders) I think in terms of licensed
production, I agree there is a definite role there because licensed
production is often setting up very long-term deals which would
require long-term view, and I think it is a place where the wisdom
of a Committee like this would be able to actually help provide
that perspective and, perhaps, help balance more short-term interests
that may be at play.
Chairman: That is a positive note on
which I think we should end this session. May I thank you very
much. I leave you with one thought to consider which is not covered
in any of the briefs we have received, and that is that this type
of legislation is going to require enforcement. What if the enforcement
bodies come forward and say they need more extensive powers to
enforce it? Where will the line be drawn between that and civil
liberties issues? May I leave that as a thought between now and
the time we start to debate this Bill, because I think it is quite
a serious point. Thank you very much indeed for coming and for
the brief. I am sure it is an on-going discussion and debate we
are going to have which is going to run into the next Parliament.
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