Mr.
Syms: Clearly, if troops are on active service somewhere
and a bribe or a facilitation payment or whatever was needed, the money
would have to come from somewhere. Unless our troops are extremely well
paid, someone would have to authorise the money, the goods, the food or
whatever was used. It is highly unlikely that a captain, a major or a
sergeant would have sufficient funds to go round bribing people on
behalf of Her Majesty’s Government. Authorisation would have to
be given at some
point.
Claire
Ward: I think the hon. Gentleman misunderstands the
concept of authorisation in relation to the security services. He is
right in a sense, that there would need to be procedures in place for
such an activity under the amendments that we made to clause 10 in
relation to the use of the defence. The Secretary of State will need to
be of the view that those procedures are satisfactory. But that is
quite different from an authorisation scheme and from the
authorisations that were included in the original clause as it came
from the other place. Of course, people who serve this
country—whether in the armed forces, on active duty or in our
intelligence services—protect us from real threats to our
society and to our well-being. They should not be exposed to the risk
of prosecution when it is evident that their conduct is legitimate. To
do so would have significant operational implication for both the
intelligence services and our brave armed forces in the sort of
circumstances described by the hon. Member for Poole; for example,
those on active duty in Afghanistan.
I put it to
the Committee that we have made significant improvements to the clause
as a result of extensive debates both here and the other place. The
defence now provides a secure legal footing for the activities of the
services concerned, while ensuring an appropriate level of oversight
and accountability. On that basis, I invite the Committee to agree that
clause 13 should stand part of the Bill.
Question
put, That the clause, as amended, stand part of the
Bill. The
Committee divided: Ayes 13, Noes
1.
Division
No.
1] Question
accordingly agreed to.
Clause 13,
as amended, ordered to stand part of the
Bill.
Clause
14Offences
under sections 1, 2 and 6 by bodies corporate
etc. Question
proposed, That the clause stand part of the
Bill.
Mr.
Djanogly: The clause ties in senior officers of
companies—or perhaps I should say bodies corporate—to
clause 1, 2 or 6 offences. It works by saying that if a senior officer
commits an offence, the underlying offence is
“proved to have
been committed with the consent or connivance”
of that
senior officer. We have been asked whether the Under-Secretary could
explain, or rather clarify, the meaning of connivance in that context.
It is, of course, an extremely important matter
that—
Claire
Ward: Who has asked the hon. Gentleman to seek clarity on
the
matter?
Mr.
Djanogly: Let me change that to say that I am asking. It
is an extremely important matter that an employee or officer could also
be prosecuted for a clause 1, 2 or 6 offence with very serious
consequences. To clarify those circumstances is also, therefore, very
important.
Mr.
Syms: Just to follow up on that point very briefly,
clearly if a senior officer has given consent, that is something that
would happen in advance of an offence occurring. If, on the other hand,
a senior officer finds out that an employee has done something and
covered it up, then, to an extent, that might be connivance.
Presumably, both would be covered by that particular aspect. I would be
grateful for further clarification from the
Under-Secretary.
2
pm
Claire
Ward: Clause 14 recognises that it is individuals who
undertake bribery, even where a body corporate is held responsible. The
clause provides that where a body corporate or a Scottish partnership
has been found guilty of bribery under the general or foreign public
official offences, a director, partner or similar senior officer of the
body or partnership is guilty of the same offence if he or she has
consented to or connived at the commission of the offence. It does not
apply to the failure by commercial organisations to prevent bribery
offence in clause
7. The
consent or connivance provision follows the model of section 12 of the
Fraud Act 2006 and, previously, section 18 of the Theft Act 1968, among
others—it is a relatively common provision. I am sure the hon.
Member for Huntingdon, as a solicitor, will be well versed
in such things. The Law Commission report, paragraph 6.132,
noted
that “there
is a compelling case to extend the ‘consent and
connivance’ regime applicable in fraud cases to bribery
offenses”. The
clause does not create a second offence of consent or connivance;
rather, the body corporate and senior officer are guilty of the main
bribery offence. If that is not a sufficient explanation for the hon.
Gentleman on the details of connivance as set out in other legislation,
I am more than happy to write to him.
Mr.
Djanogly: That is quite sufficient; I thank the
Under-Secretary for the information.
Question
put and agreed
to. Clause
14 accordingly ordered to stand part of the
Bill.
Clause
15Offences
under section 7 by
partnerships Question
proposed, That the clause stand part of the
Bill.
Mr.
Djanogly: The clause deals with offences under clause 7 by
partnerships and states that the proceedings must be brought in the
name of the partnership. However, subsection (3) states that any fine
imposed on the partnership is to be paid out of the partnership assets.
I have two questions. First, why is the Bill going away from the
standard position that partners are personally responsible for the
debts of the partnership? Secondly, if a clause 7 offence were
prosecuted, could the partners be pulled into the prosecution through
clause 14? If they cannot be pulled in by that means, why is it fair
that individuals doing business as a company can be personally
prosecuted under clause 14, but individuals doing business as a
partnership cannot?
Claire
Ward: Clause 15 includes technical provisions to deal with
proceedings for an offence under clause 7 against a partnership. Under
subsection (1), such proceedings must be brought in the name of the
partnership
and not the partners. Subsection (2) provides that certain provisions
have effect for a partnership, as they do for a body corporate: namely,
the rules of court relating to the service of documents and the
procedure on charge of an offence against a corporation. Subsection (3)
provides that any fine imposed on the partnership on conviction must be
paid out of the partnership assets; it is another provision found
regularly in legislation. A recent example, of which the hon. Gentleman
may be aware, is the Corporate Manslaughter and Corporate Homicide Act
2007, in which there are similar provisions. If that is not sufficient
detail for the hon. Gentleman, I am more than happy to write to him
with more information about other
legislation.
Mr.
Djanogly: Could the Minister address my second question? I
shall repeat it for her benefit. If a clause 7 offence were prosecuted,
could the partners be pulled into the prosecution through clause 14? If
they cannot be pulled in by that means, why is it fair that individuals
doing business acting within a company can be personally prosecuted
under clause 14, but individuals doing business as a partnership
cannot?
Claire
Ward: My understanding is that they
cannot.
Mr.
Djanogly: Who cannot? Why?
Claire
Ward: My understanding is that partners cannot be
prosecuted on that basis.
Mr.
Djanogly: The fact that they cannot be prosecuted is in
the Bill. My question is, why is there a seeming differentiation
between a partnership and a company?
Claire
Ward: The hon. Gentleman is seeking, I think,
clarification on whether partners can be brought in under clause
14.
Claire
Ward: My understanding is that they cannot. However,
should any further clarification be required, I am happy to write to
the hon.
Gentleman.
Mr.
Djanogly: May I just clarify the point? I could start a
business by setting up either a company or a partnership. The
Under-Secretary’s answer suggests that it would make sense to
set up a business under a partnership, because I would not then be
liable as an individual under the terms of the legislation. Were I to
set up a business by using a company, however, I could be personally
liable under the provisions of clause 14. That is the point I am trying
to make. It seems to be an anomaly and it needs
clarification.
Claire
Ward: I am not in a position to provide any further
clarification at this stage. Should any further information be
required, I am happy to write to the hon.
Gentleman.
Mr.
Heald: On the partnership assets in clause 15(3), a call
can normally be made on the partners if the partnership owes a debt.
Subsection (3), however, seems
to suggest instead that the assets of the partnership as constituted at
the time of conviction would be subject to the fine. If so, is there
not a danger of avoidance measures being
taken?
Mr.
Djanogly: My hon. Friend makes an important point. I think
the Under-Secretary said in her opening remarks that the standard
position is that partners cannot be held personally liable, and she
cited legislation in which that is the case. I agree with my hon.
Friend, however, that the starting position in a partnership is that
partners are personally liable. The proposal is unusual, so why are we
going down that
route?
Mr.
Heald: It would be worth the Under-Secretary addressing
the question of whether the provision runs any risks of avoidance. If
it does not, that would be all to the
good.
Claire
Ward: We are discussing the difference between debts and
criminal liability in relation to a partnership. Regarding subsection
(3), any fine should be paid out of the partnership assets, and that is
not unusual in other legislation. I am happy to reflect on the issues
raised by the hon. Members for North-East Hertfordshire and for
Huntingdon, and to write to them in due
course. Question
put and agreed to.
Clause
15 accordingly ordered to stand part of the
Bill. Clauses
16 and 17 ordered to stand part of the Bill.
Schedules
1 and 2 agreed
to. Clause
18 ordered to stand part of the
Bill.
Clause
19Commencement
and transitional provision
etc. Question
proposed, That the clause stand part of the
Bill.
Mr.
Djanogly: Will the Under-Secretary explain the discussions
that she or her Department has had with Scottish Ministers on how the
Bill will be applied in
Scotland?
Claire
Ward: The reform of the law on bribery and the
commencement is a devolved matter in Scotland. Accordingly, the
extension of the Bill to that jurisdiction is subject to the Scottish
Parliament passing the necessary legislative consent motion. I
understand that the Scottish Justice Minister tabled such a motion on
11 February, and it has subsequently been
passed. Clause
19 covers commencement and the Bill’s substantive provisions.
The new criminal offences will be brought into force by a commencement
order by the Secretary of State. As I have indicated, we will not
commence the new offence of the failure on the part of a commercial
organisation to prevent bribery until we have published the relevant
guidance for commercial organisations, as required by clause 9. Such
guidance will be available well in advance of the legislation coming
into force—an assurance that I gave to hon. Members and the
Committee earlier this week. That being the case, we do not envisage
bringing that offence into force before 1 October 2010 at the
earliest.
Question
put and agreed
to. Clause
19 accordingly ordered to stand part of the
Bill. Clause
20 ordered to stand part of the
Bill.
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