Clause 17: Defences: burden of proof

61.     This clause makes it clear that the burden imposed on a person wishing to rely on a defence in clauses 5(1) to (6), 6(1), 9(5), 10(3) and (4) and 15(3) is evidential and not legal. This means that if the defendant wants to rely on one of the defences then he must submit sufficient evidence to raise an issue with respect to the defence rather than prove his defence on the balance of probabilities

Clause 18: Offences by bodies corporate and Scottish partnerships

62.     This clause provides that officers of companies and partners of Scottish partnerships as well as the companies or partnerships themselves are liable to be prosecuted as appropriate. An officer or partner will be liable if it is proved that an offence was committed by the company or partnership with his consent or connivance or because of his neglect. An officer is defined in subsection (2).

Clause 19: Regulations

63.     This clause sets out further details on regulation and order-making powers. These powers cover the following areas in this Bill:

(i) advertising at point of sale (clause 4(3))

(ii) advertising within a specialist tobacconist (clause 6(1)(c))

     (iii) developments in technology (clause 7)

     (iv) display at point of sale (clause 8(1))

     (v) distributions at nominal amounts or at a substantial discount (clause 9(7))

     (vi) brandsharing (clause 11)

     (vii) sponsorship (clause 20).

Subsections (3) and (4) provide that the order concerning developments in technology (clause 7), and the regulations on brandsharing (clause 11), display (clause 8) and distributions at a nominal cost or substantial discount (clause 9) will be subject to the affirmative resolution procedure, which means that they will have to be debated and approved by both the House of Commons and the House of Lords (or, in the case of regulations under clause 8, the Scottish Parliament). Other regulations are subject to the negative resolution procedure.

64.     The Scottish Parliament will make regulations covering advertising at point of sale, display, specialist tobacconists and sponsorship.

65.      Nothing in this clause permits the Scottish Parliament to exercise jurisdiction outside Scotland or for the Westminster Parliament to override the wishes of the Scottish Parliament where it has been agreed that the Scottish Parliament should pass delegated legislation.

Clause 20: Transitional provisions: sponsorship

66.     This clause gives the Secretary of State, or Scottish Ministers, powers to make regulations to specify when the ban on sponsorship in clause 10 is to take effect. This may not be later than 1 October 2006.

Clause 22: Commencement, etc.

67.     See Paragraph 72 below.

FINANCIAL EFFECTS OF THE BILL

68.     The financial effects of the Bill as far as central Government is concerned are likely to be between £50,000 to £100,000. This will comprise expenditure on training for trading standards officers in relation to enforcement and information campaigns to raise awareness of the ban. This will be met from existing budgets. Enforcement authorities may wish to reprioritise workloads in order to accommodate the initial impact of the Act. The financial implications are likely to be de minimis for any given authority.

EFFECTS OF THE BILL ON PUBLIC SERVICE MANPOWER

69.     The Bill will not increase the number of permanent staff in the public service. The Government expects there to be an initial period following the coming into force of the ban when trading standards officers will want to inform retailers and others of the ban, and possibly carry out enforcement action. This may require reprioritisation of resources.

REGULATORY IMPACT ASSESSMENT

70.     It is difficult to make precise estimates of the impact of a measure of this kind. The Government has estimated that the proposed ban on tobacco advertising, promotion and sponsorship would reduce consumption of tobacco products by approximately 2.5% eventually. Assuming that this estimate is accurate, the turnover of the UK tobacco industry could be expected to fall by around £300m per annum, although the amounts spent on sponsorship would be saved and could be reinvested elsewhere in the business. This would amount to around £90m-£100m per annum. Based on these assumptions, the Government estimates that the companies' profitability could fall by around £20m per annum and that the advertising industry could lose £50m per annum, although much of this could be recouped from other clients. Other businesses would benefit from consumers' redirected expenditure. Sports would lose their existing sponsorship money from tobacco but it is difficult to estimate the extent to which this sponsorship income would be recovered from other sources. The Government has assumed that it will lose £250m per annum in lost tax revenue through the reduction in tobacco consumption which is assumed to follow a ban on tobacco advertising, although some of this would be recouped if consumers spent the money on other taxable products.

71.     On the benefits side, based on the assumption of a 2.5% fall in consumption and prevalence, the NHS in England alone would save between £20m and £40m per annum and at least 1500 lives per annum would be saved, rising to 3000 per annum in the longer term.

COMMENCEMENT

72.     This Bill will come into force on a day to be appointed by the Secretary of State, or as respects Scotland, the Scottish Ministers. The intention is that the appointed date will be two months after Royal Assent, save for the following transitional arrangements. A further three months will be allowed for:

• advertising within retail outlets

• in-pack promotion schemes (promotion schemes where coupons inserted into packs, or parts of a pack, are collected by customers who later redeem them for goods)

• direct marketing contracts (only contracts which were set up before 8 October 1999).

ECHR COMPATIBILITY

73.     Section 19 of the Human Rights Act requires the Minister in charge of a Bill in either House of Parliament to make a statement about the compatibility of the provisions of the Bill with the Convention rights (defined by section 1 of that Act). On 18th March 2002 the Secretary of State for Health made the following statement on introduction of this Bill in the House of Commons:

"In my view the provisions of the Tobacco Advertising and Promotion Bill are compatible with the Convention rights."

74.     The most significant Convention issues thought to arise on the Bill are as follows:

Clauses 2,3 and 11 and Article 10 (freedom of expression)

75     The restrictions on advertising in clauses 2 and 3 may be an interference with the right to freedom of expression in paragraph 1 of Article 10 of the ECHR but are considered to be justified as necessary for the protection of health and proportionate under paragraph 2. The same view is taken in relation to clause 11 which allows the Secretary of State to make regulations prohibiting or restricting the use of names, emblems or other features which are the same or similar between tobacco and non-tobacco products.

Clauses 10 and 11 and Article 1 of the First Protocol (protection of property)

76     Clause 10 might in some cases operate to put an end to sponsorship contracts which are already in existence at the time of the coming into force of the provision which would constitute an interference with contractual rights which are property rights for the purposes of Article 1 of the First Protocol 1. Regulations made under clause 11 in relation to brand sharing will also raise issues under Article 1 of the First Protocol to the extent that they constitute a control on the use of property. It is considered that both provisions are proportionate to the protection of health and achieve the necessary fair balance without the need for compensation.

Clause 14 and Article 8 (right to respect for private and family life)

77     Clause 14 confers the power of entry and inspection to premises which might include premises which are also dwellings and so amount to a possible interference with the right to respect for private and family life in Article 8(1). It is considered that the provision is justified as necessary for the protection of health and proportionate under paragraph 2.

DEPARTMENT OF HEALTH

March 2002