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Lord Campbell of Croy: My Lords, I am extremely grateful to all speakers who have taken part in the debate. I should like to make clear that for my part I was concerned with a single computer game. My argument was not concerned solely with violence. Car crimes can be carried out without any violence. However, they are exasperating to much of the population. The game to which I referred has been released for only two months or less, so there has been no time in which to try to relate it to any increase in those crimes.
The noble Lord, Lord Birkett, who has been a member of the Classification Board, confirmed my point that the promoters of these computer games took the attitude that they were just a joke. Where does it stop? Does it extend to burglary or mugging old ladies? Almost any offensive crime could be treated simply as a joke.
I am most grateful particularly to the noble Lord, Lord Williams of Mostyn, who has replied extremely carefully and fully to the questions that I have raised on this subject over several months. I commend the Motion to your Lordships.
On Question, Motion agreed to.
Lord Alton of Liverpool: My Lords, I should like to thank noble Lords for their contribution to the debate this evening. In particular, I thank the noble Lord, Lord Williams of Mostyn, for his reply.
Competition Bill [H.L.]
9.10 p.m.
Consideration of amendments on Report resumed.
Lord Simon of Highbury moved Amendments Nos. 25 to 27:
The noble Lord said: My Lords, I beg to move Amendments Nos. 25 to 27 en bloc.
On Question, amendments agreed to.
Lord Fraser of Carmyllie moved Amendment No. 28:
Page 10, line 40, leave out from beginning to second ("or") and insert ("providing for one or more additional exclusions;").
Page 11, line 1, leave out ("case") and insert ("provision").
Page 11, line 2, at end insert--
("( ) The Secretary of State may at any time by order amend paragraph 6 of Schedule 3 with respect to the Chapter II prohibition.").
After Clause 19, insert the following new clause--
(" . The Chapter II prohibition does not apply to any conduct arising from the performance of an agreement which is exempted from the Chapter I prohibition in accordance with section 4.").
The noble Lord said: My Lords, when noble Lords considered the amendment in my name on the subject of vertical agreements I indicated that I was grateful to the Minister for providing me with a copy of the expert report on how the European Court and the Commission approached such matters. I do not depart from my gratitude to the Minister for that. However, after the dinner hour I am in a slightly more suspicious frame of mind. The suspicion underlying Amendment No. 28 is that if and when the Government bring forward a proposal that allows for exemptions or exclusions from the Chapter I prohibition on vertical agreements they may be a little relaxed about them because they will reassure themselves that in any event any matter of which they disapprove will be caught under a Chapter II prohibition.
With the insertion of a new clause, the amendment seeks to provide that the Chapter II prohibition does not apply to any conduct arising from the performance of an agreement which is exempted from the Chapter I prohibition in accordance with Clause 4.
I appreciate that in some respects the amendment is premature in as much as we have not seen what are the exclusions. I should like reassurance from the Minister that where such an exemption is allowed for, there will not be, as it were, a back door through which the conduct can be looked at in terms of a Chapter II prohibition. I do not believe that the argument needs any elaboration. If the Minister can give some reassurance that would be helpful. I beg to move.
9.15 p.m.
Lord Simon of Highbury: My Lords, we debated the issue of the relationship between the two prohibitions during the first Committee day in response to an amendment proposed by the noble Lord, Lord Kingsland. As I said then, the two prohibitions introduced by the Bill will operate hand in hand. Essentially they will have the same relationship to each other as do Articles 85 and 86 of the treaty. That relationship is well established and works satisfactorily in practice.
On the basis of EC jurisprudence, the director cannot grant an agreement an exemption under the Chapter I prohibition if in doing so he would be exempting something that appears to be prohibited under the Chapter II prohibition. There should be no specific provision in the Bill providing protection from the Chapter II prohibition for agreements which have obtained an individual exemption. Parties who have obtained an individual exemption will have the benefit of knowing that the director has had to take account of the Chapter II prohibition in assessing their agreement.
Of course an exemption cannot provide a blank cheque for any type of anti-competitive behaviour in the future. The relevant market might change materially in an unforeseen way, for example, and the agreement might become seriously harmful. Action against the agreement might then become possible either by withdrawing the exemption or under the Chapter II prohibition, but only of course if the relevant conditions and safeguards were met. It would be wrong to place
any legal bar on the fact of the Bill preventing action in such circumstances. I therefore invite the noble and learned Lord to withdraw the amendment.
Lord Fraser of Carmyllie: My Lords, I would not go so far as to say that it would be wrong to have such a legal bar, but as I said in my opening remarks, it would be curious to try to establish the relationship until we know what will be the scheme for exclusion or exemption. So I shall withdraw the amendment.
I hope that the Minister will take the amendment as a shot across his bows. As he seeks to work out what would be the best arrangements for exemptions or exclusions for vertical agreements, I hope that he will understand that we shall be looking to see that there is as clear as possible an arrangement between the Chapter I and Chapter II prohibitions. He offered some reassurance when he said that if an exemption were to be granted on an individual basis, whoever has the responsibility for granting it would have been required to look to see if there were any problem with a Chapter II prohibition. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 1 [Exclusions: Mergers and Concentrations]:
Lord Simon of Highbury moved Amendment No. 29:
The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 30 and 31. In Committee, the noble Lord, Lord Kingsland, suggested that ancillary agreements to mergers should be excluded from the Chapter II prohibition as well as the Chapter I prohibition. I was grateful to the noble Lord for raising the matter.
As I indicated at the time, we would not normally expect the entering into of restrictions ancillary to a merger to fall foul of the Chapter II prohibition. But I do not believe we can rule that out, and it is therefore right to provide an exclusion. Amendments Nos. 29, 30 and 31 have that effect. I beg to move.
Lord Kingsland: My Lords, is this a moment when I must thank the Minister for his kind concession? I am obliged to him.
On Question, amendment agreed to.
Lord Simon of Highbury moved Amendments Nos. 30 and 31:
On Question, amendments agreed to.
Lord Simon of Highbury moved Amendment No. 32:
The noble Lord said: My Lords, in moving Amendment No. 32, I shall speak also to Amendments Nos. 33, 71, 160, 162, 163, 187, 188, 189, 190 and 220. The first two amendments explain the exclusion and clawback which we have put in place. They will be relevant, for instance, to issues under Clauses 21 and 22 which we discussed earlier.
Amendments Nos. 160, 162, 163, 187, 188, 189, 190 and 220 define information which is required by the director in making assessments of the provisions under Amendments Nos. 32 and 33 for the definition of clawback.
There is an artificial and unnecessary rigidity. It would be better if it were generally enabled to make a notification before any exclusion were lost. Amendment No. 71 provides a power for regulations to be made which would enable provision for that effect. They are all technical amendments. I beg to move.
On Question, amendment agreed to.
Page 39, line 26, after ("1973),"), insert ("or
(b) is directly related and necessary to the attainment of the result mentioned in paragraph (a),").
Page 39, line 34, after ("conduct") insert ("(either on its own or when taken together with other conduct)").
Page 39, line 35, at end insert ("or
(b) it is directly related and necessary to the implementation of the transfer.").
Page 39, line 40, at end insert--
("(1A) If the Director is considering whether to give a direction under this paragraph, he may by notice in writing require any party to the agreement in question to give him such information in connection with the agreement as he may require.
(1B) The Director may give a direction under this paragraph only as provided in sub-paragraph (1C) or (2).
(1C) If before the end of such period as may be specified in rules under section 49 a person fails, without reasonable excuse, to comply with a requirement imposed under sub-paragraph (1A), the Director may give a direction under this paragraph.").
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