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Lord Haskel: My Lords, the noble Lord, Lord Kingsland, has developed his ideas a good deal further since they were discussed at Report. He said that he was moving towards a court of first instance. My noble friend Lord Borrie has replied in a manner that is far better than I could manage myself.
The noble Lord, Lord Kingsland, has been consistent in his thesis. He has proposed a tribunal that would much more closely resemble a division of the High Court than the specialised tribunal that we intend. I too shall be consistent. There is a difference of principle between us. We propose a tribunal to deal with complex commercial issues relating to specialised areas of economics, competition and the law. As my noble friend Lord Borrie said, it is crucial to the success of the new regime that that tribunal is able to deal with such cases with expertise, fairness and efficiency so that it is credible. This means that the tribunal panel must include lay members with particular areas of expertise and experience as well as legally qualified members of appropriate standing. The tribunal that we envisage will have both. We believe that lay members will be able to add tremendously to the resources and expertise of the tribunal. It would be most unfortunate to dispense with that expertise, as the amendment seeks to do.
Our arrangements for appointments will open up a much wider pool of expertise. We believe that this will be extremely valuable both for the legally qualified president and chairman and for the lay members. We also believe that the Secretary of State for Trade and Industry will be well placed to identify and select candidates with the necessary blend and breadth of experience to lead the tribunal. At the same time it is important that the president and chairman have considerable legal experience and standing. This is obviously crucial to confidence in the new regime. We intend that whoever is appointed would have a standing at least equivalent to that of a High Court judge. The Bill requires the Secretary of State to consult the Lord Chancellor on legal appointments to the tribunal.
The noble Lord, Lord Kingsland, spoke of separation between appeal and investigatory functions. It is crucial to have this separation. We have done this in our arrangements by clearly separating the tribunal from the director who is responsible for investigation and enforcement under the prohibitions. The reporting side
of the competition commission will not be dealing with cases under the prohibitions. I hope that this explanation satisfies the noble Lord.We envisage a rather user-friendly specialised tribunal; the noble Lord's proposals would be much closer to a division of the High Court. There is a difference of principle between us, but our proposals will satisfy the needs in the end. I hope that the noble Lord will withdraw his amendment.
Lord Kingsland: My Lords, I am deeply disappointed at what the Minister has said. The only thing I got right in my intervention was the reaction of the noble Lord, Lord Borrie, to what I said.
I hope the Minister will think again about what he has said. It is crucial that justice is seen to be done by the business community that the appeals tribunal will serve. If people who sit on the appeal tribunal play an investigatory role in the other part of the competition commission, it will not be credible. It is unacceptable that there should be a cross-fertilisation of individuals who are capable of playing both roles. Whatever else the Minister reflects upon as a result of these exchanges, I hope he will reflect upon that point. It is not inappropriate that complex economic matters should be heard by a third party, arbitral system supervised by a High Court judge. Quite often the only way these complex matters can be sorted out is by applying the legal process.
If the tribunal is not credible, then the ordinary courts of the land--either in judicial reviews or appeals to the High Court--will become over-burdened with complex issues which ought to be dealt with by a specialised court of a kind that the Minister refuses to contemplate. I am most disappointed, but I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 34 and 35 not moved.]
Clause 50 [Appeals on point of law, etc.]:
7.15 p.m.
Lord Sempill moved Amendment No. 37:
The noble Lord said: My Lords, I rise to speak to Amendments Nos. 37 and 38. Before doing so, I apologise to the Minister for my intervention at this late stage. Unfortunately my noble friend and colleague Lord St. John is unable to be with us and I feel as if I have been plucked off the substitute's bench with five minutes to go. I may have a pair of fresh legs but I do not have his expertise in confronting such a formidable defence.
These amendments have been altered in order to address some of the Minister's previous reservations. We maintain that the issue remains the same--an issue of clarity over who does what. These amendments will ensure that certain tasks are dealt with by the Office of
The Bill would be strengthened and the key objectives of certainty and consistency would be promoted if the Bill prescribed who should do what. I beg to move.
Lord Kingsland: My Lords, we are speaking to Amendments Nos. 37 and 39 and also to Amendments Nos. 58 and 59. Amendments Nos. 37 and 39 apply to the relationship between the Director General of Fair Trading or regulators, and the latter amendments are specific to British Telecommunications.
The Minister is familiar with this matter. Although I have not seen any written evidence, I understand that on the crucial subject of what has come to be known in the jargon as "the bridge" he has made a very substantial concession. If that is so, I am extremely grateful to him.
This amendment concerns the second central problem of concurrency. The intention of Amendment No. 39 is to meet some of the objections that the Minister had to the previous amendment. I draw his attention to three parts of it. Subsection (5) reads,
On Report the Minister described those words as being too vague. They are, in fact, an expression contained in the Restrictive Trade Practices Act. It may be that experience has shown them to be too vague but there is at least a respectable precedent for them.
I also draw attention to subsections (6) and (7). These give the Minister the best of both worlds. On one hand, on the face of the Bill, he has a clear set of criteria upon which to establish who is responsible for what. If he wishes to alter the criteria he has, in subsection (6), the power of the Secretary of State, by order, to amend subsection (5) by providing one or more additional categories of reserved matters. So the range of reserved matters is unlimited at the Secretary of State's discretion.
Even more importantly, subsection (7) provides that,
So the Secretary of State will have complete discretion in this matter.
Thus, on the one hand you have the merit of clarity for the clients, if I may put it that way--that is the enterprises likely to be subject to investigation either by the director-general or the regulator--and, on the other hand, the merit of flexibility, because the Secretary of State can alter the position at any time he wants. This would be infinitely preferable to the kind of old boy network which has been described at various stages throughout the debate on this Bill. That is not a satisfactory way of providing the kind of certainty
Lord Simon of Highbury: My Lords, on Report I set out once again why we believe the principle of concurrency is right. This is a Bill about competition. Regulators need to have powers in order to apply competition law in their sectors and to co-ordinate their use of sector-specific regulation with those powers. We have said that we do not believe that a "bright line" of jurisdiction between the DGFT and each of the regulators is practical. We do not want gaps or litigation about whether the DGFT or a regulator has jurisdiction. Hence, powers have to be exercisable concurrently by the regulator and the Director General of Fair Trading.
The marketplace is dynamic, as we have repeated many times. The legal scope of a regulator's remit needs to be kept under review. It must be clear, but it must be wide enough and it must be up to date. That links to the utilities review, and it is one of the reasons why we are committed to keeping the regulation of telecommunications and broadcasting up to date and expect to launch a consultation document on that in the spring. That is where the wider review of scope is taking place. It is right that this Bill should limit itself to providing concurrent powers on a similar basis to the concurrent powers regulators already have under existing competition law.
We have said clearly that flexible rules need to be drawn up covering the procedures that will apply where concurrent jurisdiction exists. Rules need to change and adapt as necessary. Let us define the rules that we need now, and make clear as part of the rules how notification should be made. That is a matter for the Director General of Fair Trading, consulting regulators and appropriate persons, to decide in the first instance, under Clause 51 of the Bill. Rules are, however, to be subject to consultation, approval by the Secretary of State and the parliamentary process, so that there will be ample opportunity to make sure that they are clear and adequate. There is further scope for clarification of the role of individual regulators in the advice and information to be prepared under Clause 52.
However, I accepted that there was a need to reflect further on the provision in utility statutes that requires a regulator and the DGFT to consult before either takes action; and for one to be barred from taking action once the other has done so. We will continue to reflect on that point.
I emphasised that we regard consistency in the basis for applying the Chapter I and II prohibitions as paramount, and accepted that we need to bring forward amendments to ensure that that is achieved. We have done so, and we will be considering those amendments a little later. They represent a significant response to concerns expressed by noble Lords, as the noble Lord, Lord Kingsland, gratifyingly noted.
However, where there would clearly be an unsatisfactory interaction between the prohibitions and the licence regime, as the noble Lord, Lord Kingsland, raised on enforcement, we have said that we will come
In all of that I was seeking to describe and develop a framework in which, in a dynamic marketplace, sensible people will speak and work together under a format of rules which will be flexible and capable of taking into account the dynamism of the marketplace, which we all wish to encourage and make more competitive.
I have made that general statement because I hope that, on reflection, noble Lords will be pleased and take pride in the amendments that they have encouraged us to bring forward to refine that part of the Bill, and that they will also support us in providing concurrent powers, on the appropriate basis, to sector regulators.
We do not want those powers hamstrung by constraints and rigidities. We do want them implemented with the co-operative approach we are already seeing from the DGFT's working party with regulators, and noble Lords are aware of progress made from the letter in the Library.
The amendments in the present group do not follow that sensible approach. They would cut across the consultation between a regulator and the DGFT as to which of them should exercise concurrent functions in a particular case. They would claw back a large part of a regulator's concurrent functions. As I made clear on Report, I do not believe that that would be right. The criteria by which they would do so are, in some cases, subjective. In other cases they would make almost impossible the application of the prohibitions by a regulator. For example, the criteria would mean that a regulator would be prevented from taking action in respect of a matter which mainly but not exclusively falls within the scope of his jurisdiction; many of the matters within the scope of a regulator's jurisdiction would affect commercial projects; and how could a regulator apply the prohibitions if he is prevented from being able to interpret them? Moreover, they leave the determination of what would fall within the criteria, as was pointed out by the noble Lord, Lord Kingsland, to the Secretary of State. I indicated at Report, in relation to the exclusion for services of general economic interest, that the Government did not wish the Secretary of State to have a role in case-by-case determinations (col. 968 on 9th February). I do not believe it would be right for the Secretary of State to have a role in making determinations against unsatisfactory criteria such as those.
We have stated our case in depth and broadly, and tried to set out the principles which lie behind our approach on concurrency. As I said, we are bringing forward further amendments in the light of previous debates. Therefore, I urge the noble Lord to withdraw the amendment.
Page 28, line 5, after ("Part") insert (", subject to subsections (4) to (9),").
"For the purposes of this section a 'reserved matter' means which a matter which ...
(e) affects or may affect an industrial or commercial project or scheme of substantial importance to the national economy".
"Any question as to whether a matter is a reserved matter for the purposes of this section shall be determined by the Secretary of State".
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