Export Control Bill

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Mr. Gerald Howarth: Perhaps it would be useful for the Minister to suggest to the Export Control Organisation that it consult the Defence Export Services Organisation, because I gather that the MOD form 680 procedure is largely governed by DESO. It therefore has a wealth of experience in this respect. If the orders are to be made workable and cause the least possible encumbrance for industry, DESO can perhaps give some advice to the organisation that the Minister mentioned.

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Nigel Griffiths: I am sure that we and our associated bodies will welcome advice from anyone with expertise in the field.

The hon. Member for Twickenham (Dr. Cable) raised two important points. My officials have had a valuable meeting with the universities, which, I believe, are now satisfied that we shall be able to work together to ensure that academic freedoms are respected while proper controls are enforced. I know that that will be conveyed to the hon. Gentleman. We also intend that the existing open and individual licences for transfers of military technology will be automatically extended to cover the transfer of the same technology electronically.

The amendment would ensure that transfers of technology within one company or group could not be subject to control. The Government firmly believe that the power to control the transfer of technology within one company is essential to the effective operation of our export control regime. If transfers within one company were excluded from control, an unscrupulous exporter or individual could transfer sensitive technology simply by setting up a company with offices overseas. I am sure that members of the Committee agree that that would amount to an unacceptable loophole in our controls.

I can allay the fears of the hon. Member for Aldershot. I am confident that the continued use of open licensing will enable transparency to continue and red tape to be reduced.

My hon. Friend the Member for Wolverhampton, South-West highlighted the fact that the amendment would create problems by generating loopholes.

In view of those arguments, I hope that the hon. Member for Salisbury will withdraw his amendment.

Mr. Key: I am grateful to the Minister for his considered view of the amendment. I listened with great interest to the contributions from both sides of the Committee. The most important thing that the Minister did was to give an assurance that companies would be able to apply for licences for joint or group actions and that intra-company transfers and partnerships would be handled sensitively. That satisfies the main purpose of the amendment, which is to tease out the issues. There was agreement on both sides of the Committee that it was necessary to seek clarification from the Government.

I am relieved to hear about the meeting with the universities, and I am delighted that they are happier than they were. I am glad that the Export Control Organisation will carry out its important awareness exercise. Hon. Members tend to think that the Confederation of British Industry is the answer to all questions on consultation between the Government and industry, but it is not. Plenty of small companies are not members of the CBI and feel left out in one way or another. I am glad, too, about the Minister's remarks on open licensing.

Bearing in mind the fact that we have had a commitment from the Minister, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Key: I beg to move amendment No. 49, in page 2, line 28, leave out sub-paragraph (b).

Mr. Benton, I am sure that you and the Committee will be enormously relieved to hear that I am not a lawyer. My amendments are not tabled in that spirit; I am simply representing the voice of the common man and, I hope, common sense.

The amendment is not difficult: quite simply, I do not have a clue what subsection 5(b) means. The Home Secretary was disarmingly honest with me in the Chamber yesterday, but we shall come to that later. I will use my disarming simplicity now and say that I do not know what on earth subsection 5(b) means. It appears to say that

    ```technology' means information . . . capable of use in connection with . . . an activity of any other kind whatsoever'',

such as pencil sharpeners, garlic presses and cricket bats. It does not refer specifically to dual-use technology, but is as broad as the Atlantic ocean and as long as a piece of string. An incidental bit of useless information is that, when I was a Minister at the Department of National Heritage, I discovered that the length of a piece of string is 600 ft, so it is finite. One needs to learn in this place.

I do not know what the clause means. As a non-lawyer, all I know is that subsection (5)(b) is a lawyer's paradise. The courts will be full of people arguing about what it means by

    ``an activity of any other kind whatsoever'',

so I would be grateful if the Minister would tell us what it means.

Nigel Griffiths: It may help the Committee if I give a little explanation of clause 2(5) and the definition of technology, which reads:

    ``information . . . capable of use in connection with . . . the development, production or use of any goods or software''

    ``the development of, or the carrying out of, an industrial or commercial''

or other activity. I assure the Committee that it could not cover garlic presses, because the subsection is governed by the purposes of the Bill. If hon. Members want to think up a few slightly more plausible examples, I would be happy to give a considered opinion on them.

I agree that many types of technology that could be covered by the definition will not in practice be subject to control. Given the pace of technological change in development, the concern is that new technologies could be developed in the future—perhaps the near future—that could threaten any consequence in the schedule. The broad definition of technology used in the subsection is therefore necessary to enable the Government to impose controls on any such technology, should it emerge.

The deletion of subsection (5)(b) would limit the type of technology controlled under the Bill. Any other type of information, no matter how serious its potential for misuse in the wrong hands, would be excluded from control if the amendment were made. Although I understand the concern that the new controls on technology transfer should be clear to industry and not an undue burden, I fear that the amendment would significantly restrict the powers available to the Government.

Subsection (5)(b) is necessary because we cannot foresee new types of technology that may be developed that, although not related to goods or software, could none the less be used to threaten any consequence in the schedule. Such is the pace of technological change and innovation that we must ensure that the new legislation is not rendered quickly out of date by the emergence of new technological methods and processes that fall outwith the relatively conventional definition of technology in subsection (5)(a). The UK cannot be in a position in which new primary legislation needs to be passed before new and possibly highly sensitive technology can be controlled, simply because the technology may not be covered or fully covered by the traditional definitions used in the existing control regime.

It is important for the Committee to appreciate the fact that sensitive technology might not necessarily be associated with goods or software. For instance, it might support more experimental work carried out before the actual development of the goods or software, or could simply relate to information connected with a specific activity that did not necessarily involve goods or software.

I assure the hon. Member for Salisbury and other members of the Committee that controls may be imposed on classes of technology only when their export or transfer from the UK could threaten one or more of the consequences in the schedule. That is clearly specified in the draft dummy order that has been made available to the Committee relating to the export of goods, technology transfers and technical assistance. In view of that, I invite the hon. Gentleman to withdraw the amendment.

Mr. Key: Well, that is exactly as I feared. The provision is a completely open-ended gift to the Government. The Minister has done a fine job in explaining what he means, and what he means is that I was absolutely right. Now he invites me to withdraw the amendment. Given that there will be a consultation period with industry, during which interested parties will have the opportunity to explore the matter more fully, and given that the Bill will go to the other place, where they are rather good at this sort of thing, I am prepared to give the Minister the benefit of the doubt.

However, the Committee should recognise that this is a huge open-ended provision. I cannot recall any other legislation that not only allows the Minister and the Government to do what they wish but also makes it easy for them by including provision for unforeseen events and uninvented technologies. I remain concerned about that, but I can see that we will not get any further on the matter. However, I have a feeling that it will re-emerge in the other place as an important issue. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Nigel Griffiths: The clause is a vital part of the Bill. It represents an essential modernisation of existing controls. At present, we can only impose controls on military technology in physical form, such as on paper or on computer disk. That does not make sense given the huge developments in communications, particularly in electronic communications, that have taken place since the 1939 Act came into force. We intend to use the powers in the clause to impose controls on the transfer abroad of military technology by electronic means, mirroring the controls that we now have on exports of such technology by physical means. We also intend to use these powers to introduce controls on the transfer by any means of technology for use in the development of weapons of mass destruction or missiles capable of the delivery of such weapons. We are committed to taking action in this area by the terms of the European Union joint action programme on weapons of mass destruction, which we agreed last year and which will ensure that controls are implemented across Europe. I commend the clause to the Committee.

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