Licensing Bill [Lords]

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Mr. Moss: I do not believe that I am the first person to have proposed such an amendment—something similar was tabled in the other place, where the same arguments were deployed. That amendment received quite a lot of support from lawyers and those who have had a career in the legal profession and have some working knowledge of the way in which the justices benches operate and could envisage problems

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because of the amount of training that would be involved.

If the Minister is saying that those on the benches would have the discretion to decide whom, when and where, that underlines the argument to a certain extent. As long as they will have the discretion to allow them to approach the matter sensibly, we will not be loading costs on them and causing difficulties. In any event, the types of issues that would be raised in appeals when someone has had a licence application turned down would be similar to those with which the licensing justices deal at present—considerations to be given to the appropriateness of the person in terms of whether they are a fit and proper person to hold the licence and taking into account the impact on the local environment and local residents. The themes would be pretty much the same under the new legislation albeit that this is new legislation and it extends the range of issues that would have to be taken into account.

I am satisfied with the Minister's explanation. As long as the justices benches will have real discretion, I am more than happy to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 5 agreed to.

Clauses 180 to 186 ordered to stand part of the Bill.

Clause 187

Location of Sales

9.30 am

Mr. Moss: I beg to move amendment No. 223, in

    clause 187, page 103, line 16, leave out

    'alcohol is appropriated to the contract'

    and insert 'contract is made'.

Clause 187 deals with the selling of alcohol over a distance—for example, by mail, by internet or through a call centre. The clause is fundamentally flawed as it deems the premises where the alcohol is stored and is ''appropriated to the contract'', not the premises where the contract to sell the alcohol is made, to be the premises that require the licence. Indeed, the explanatory notes confirm that provision by specifying that once an order is taken for alcohol via a call centre or by mail order, for the purposes of the Bill, the sale is deemed to take place at the warehouse storing the alcohol, from where it will be delivered. That means that the retail operation where the sale of the alcohol is concluded can effectively operate unlicensed. The sale would take place under the authority of the designated premises supervisor within the warehouse.

The clause is another sign that the Government have not really consulted all the relevant sectors of the industry before drafting the Bill. It also displays a lack of understanding of the workings and structural make-up of many of the organisations that are involved with such arm's-length sales.

The Bill assumes that the business making the sale has control and influence over the organisation responsible for delivery of the product, which is not usually the case. The Wine and Spirit Association of Great Britain and Northern Ireland has declared a

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particular concern about the provision because of the numerous companies and organisations that it represents that sell wine and other alcohol over distance. Indeed, the organisation has a designated distance-selling committee to represent members whose business is the distance-selling of wine via call centres and company offices or via the internet. In most cases, the wine is stored not on the company premises but in public bonded warehouses, whose control remains outside the company's influence and ownership. The system usually operates by the company that sells the wine requesting the required amount to be released from the third party—the bonded warehouse—which arranges for delivery as stipulated in the order. That contract is the only relationship between the company that sells the wine and the warehouse. There is no inter-managerial control between the two organisations.

Two primary causes for concern arise from the fact that the warehouses, which have no previous experience in or understanding of the retail operations of the companies, will be entirely responsible for the sale of alcohol as we understand it under the legislation. First, the organisation that makes the sale no longer has responsibility or control over the sale of the alcohol. Surely it is in the interests of the Bill that the individual making the sale must remain responsible and accountable until the transaction is completed.

Dr. Howells: What the hon. Gentleman is saying is interesting. If a call centre is situated in another country and the warehouse that he has been talking about is in this country, as our jurisdiction cannot affect what happens in a call centre in another country, that warehouse would remain completely unlicensed. It would be able to distribute orders taken in a call centre in India—or anywhere else—and there would be no control over the nature of its sales or where they go. Is that what the hon. Gentleman is calling for?

Mr. Moss: I did not mention overseas call centres or retailing companies. They must be in the minority; we are talking largely about businesses based in this country.

It is up to the Minister to say that the fears and concerns of the Wine and Spirit Association of Great Britain and Northern Ireland are false and unwarranted. At the moment, this is the only example that he has given: if the retail centre is abroad, should we allow the warehouses and the bonded places to be unlicensed? I am not suggesting that they should be left totally unlicensed. A balance must be struck between the responsibilities of those retailing the wine and those releasing it from the warehouse. There is a contract of a kind between them; there must be a sensible way forward. It may not be through my amendments, but problems have been highlighted and the Minister must address them.

Mr. Hoban: Like other hon. Members, I purchase wine by mail order, over the telephone and via the internet. My customer relationship is with the retailer rather than the deliverer. When I am not at home, the wine is delivered and it is left in the garage. The warehouse, or the deliverers, do not know anything about me as a customer; they are simply dropping off

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the wine. That relationship will have to change as a consequence of this Bill.

Mr. Moss: My hon. Friend makes a good point: I will come to the problems associated with delivery later.

The individuals who will be liable for the personal licence are the bonded warehouse keepers, who are unlikely to have knowledge or experience in the retail and licensed trade. They are rightly concerned about the level of responsibility and accountability now placed on them.

Warehouses often take orders from a wide range of alcohol retailers. If one of those retailers—who, according to the Bill, can effectively operate unlicensed—participates in unlawful practice or sanctionable activity, the warehouse may be forced to surrender its licence, despite the fact that it has no influence or control over the practices of such retailers. Warehouses should not be made accountable for that.

The designated premises supervisor from the warehouse will be required to ensure that every sale of alcohol is in accordance with the provisions of the Act—for example, that alcohol is not delivered to children. How are they to know whether they are doing that? They might have an address and a name, but they will have no means of checking where an individual lives or how old they are. That area of the legislation must be tightened up.

Mr. Sanders: I wish to follow up on the point made by the hon. Member for Fareham (Mr. Hoban). The delivery companies will put on their instructions where to leave the product if there is no reply at the door. It would be easy for somebody who is not entitled to purchase alcohol to have a relationship with the company without anybody knowing their age or status. The hon. Gentleman raises an important point, but I would also be interested to know how the existing law works.

Mr. Moss: The Minister ought to respond to that question, because he must tell us whether the law works at present and justify his plans to change it.

I shall return to the argument that I was developing. In effect, the retailers will become subsidiaries of the organisations that do the warehousing and are contracted to make deliveries for them. The Wine and Spirit Association believes that severe and unacceptable restrictions on operations will be imposed on the companies that are predominantly involved in the trade. The association fears that the Government have not thought things through. In fact, it claims that there was no proper consultation with the Government before the Bill was drafted.

By imposing the provision the Government are defying their own claims that the Bill is deregulatory and designed to reduce bureaucracy and red tape. The industry already faces much of that, and this provision ensures that the distance-selling companies and public bonded warehouse operators will be subject to an immeasurable increase in administration and red tape.

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It also jeopardises the fundamental objectives that are carefully crafted throughout the Bill.

Dr. Howells: I would like to make it clear to the hon. Gentleman and the Committee that consultations did take place. I fear that we have another case of what we ought to call selective briefing. Lengthy and extensive consultation with all sections of the industry and other stakeholders took place over many years. Indeed, officials from my Department visited warehouses during the consultation. At its most recent meeting with the Department, the Wine and Spirit Association did not raise concerns about the present issue; it should get its act together. The lobbyists should tell the truth, whether they are talking to us or to the Opposition—they make a fortune out of their consultation business. Two messages are coming across that are designed to make the best possible case for their clients. However, those undermine the credibility of the organisations that seek to represent good honest businesses in this country. I imagine that such organisations would try to get the best possible legal and law-abiding arrangement for their clients.

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