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Lord McNally: My Lords, I watched the approach of this amendment with some trepidation because I

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thought that the noble Lord, Lord Mackay of Ardbrecknish, might suddenly appear, fresh and full of vim and vigour, to stimulate us all. However, clearly he is back in the Glens.

I want to make one small observation attached to the phrase "economic well-being of the United Kingdom". I am increasingly concerned about industrial espionage and its acceptance in the manner of, "Oh, everyone--the Americans, the French or whoever--does it". I believe that industrial espionage can be extremely corrosive--almost as corrosive as is corruption. Recently, grotesque activity was exposed in the United States concerning major corporations which bug each other. I read an article in one of the papers about the vast industry of hi-tech companies which sell to business all kinds of equipment to both bug and debug.

That may be the nature of the world in which we live, but I believe that the Government should be using their influence internationally in order to minimise industrial espionage either by governments or by individual corporations. As I said, I believe that it is corrosive and undermines genuine economic and industrial activity. In the terms of this Bill, the catch-all phrase "economic well-being of the United Kingdom" is a little disturbing. I believe that as Britain has always stood for the highest standards of integrity in terms of business dealing, and given the dangers that the new technologies bring, we should be on our guard against the corrupting influence of this type of activity.

Lord Bassam of Brighton: My Lords, I always listen carefully to the noble Lord, Lord McNally. I am not sure whether he has just given a speech in support of the amendment or in support of the Government's concern that lies behind our continued reliance on the words used in the Bill.

The aim of the amendment is to ensure that no power under the Bill exercised in the interests of the economic well-being of the United Kingdom can be used in relation to activity within this country. However, we believe that the effect of the amendment is already achieved via existing statutes.

As I explained last night on Amendment No. 48, the amendment is largely unnecessary because the underlying powers of the relevant agencies that may lawfully obtain material in the interests of the economic well-being of the UK are constrained by existing statutes, which significantly confine the agencies' functions.

As I explained, the statutory functions of the Secret Intelligence Service and GCHQ, which may be exercisable,

    "in the interests of the economic well-being of the United Kingdom"

are constrained by the Intelligence Services Act 1994 only to where this relates to,

    "the actions or intentions of persons outside the British Islands".

The corresponding function of the Security Service is to safeguard the economic well-being of the UK against threats posed by the actions or intentions of persons outside the British Islands, by virtue of Section

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1(3) of the Security Service Act 1989. Section 5(2)(a) of the ISA says that the Secretary of State may authorise a warrant only where it is necessary for carrying out the functions of the agencies. Those functions are constrained as I have just described. As regards economic well-being, that must relate to the actions or intentions of persons outside the UK. It is unlawful for the agencies to act outside their statutory functions.

Circumstances might arise in which the agencies came into possession of information other than by a statutory power. One might ask whether they would, in such cases, be empowered by the Bill to serve, for example, a Section 47 notice to decrypt such material when it related only to the actions or intentions of persons inside the UK. I can confirm that such behaviour could not be authorised under the Bill. The agencies may only act within their statutory functions. Any activity that they undertake on the grounds of the country's economic well-being must relate to the actions or intentions of persons outside the UK.

I probably made a mistake when I said that the effect of the amendment was met by other statutes. I should have said that the principal effect was met by other statutes. The amendment would go wider than current law.

The noble Lord, Lord Cope, also spoke to Amendment No. 101A, which gives rise to some interesting considerations. He said that it was of concern to trade unions and others.

This limb of the definition,

    "large number of persons in pursuit of a common purpose"

derives from similar wording first used in Home Office guidance issued to the police and Customs in 1951 and employed by the Interception of Communications Act since 1985. The 1951 Home Office guidelines explained to the police that "serious crime" offences were those for which a man with no previous record could reasonably be expected to be sentenced to three years' imprisonment, or offences of lesser gravity in which a large number of people were involved.

After substantial parliamentary debate, the current definition was incorporated in the Interception of Communications Act 1985. It has since been repeated in several other Acts, including the Police Act 1997, the Intelligence Services Act 1994 and the Security Service Act 1996. This definition was chosen instead of the definition of "serious arrestable offence" in the Police and Criminal Evidence Act 1984 on the basis that the Interception of Communications Act definition is narrower.

The definition of "serious crime" makes it clear that the starting point is a crime itself. A crime that does not involve the use of violence or result in substantial gain may nevertheless fall within the definition of "serious crime" if the criminal conduct is carried out by a large number of persons in pursuit of a common purpose. Any criminal act carried out by a large number of persons in pursuit of a common purpose counts as a "serious crime". The idea that this part of the definition could be used to justify interception or intrusive surveillance of legitimate peaceful protesters

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is not correct. We are talking about preventing or detecting situations involving a large number of persons and a large number of crimes but in which each individual crime would not necessarily fall within any of the other limbs.

During the debate on the Interception of Communications Bill in 1985, the late Lord Whitelaw explained that the "large number of persons" definition was needed to deal with the case of a major criminal conspiracy involving many people but in which the involvement of any individual was not necessarily such as to bring the case within criteria relating to the length of likely sentence. He suggested that some form of racketeering might be one example.

During the Police Bill debates in 1996, Michael Howard gave the example of a situation in which a large number of neo-Nazi youths concerted to disrupt a football match but none of them was sentenced to more than three years for their activity. He also gave the example of certain offences under the Criminal Damage Act 1971. However, it is not enough simply to determine whether crime falls within the definition of "serious crime". In any particular case, necessity and proportionality need to be considered. It may not be appropriate in the circumstances of the case to issue a warrant for interception or grant an authorisation for intrusive surveillance.

I can give further reassurance by quoting from the 1997 report of the interception commissioner who at the time was the noble and learned Lord, Lord Nolan. He said:

    "All of the serious crime warrants which I have examined have been concerned with offences which would rank as serious crime by any reckoning."

I trust that with that explanation, the noble Lord will consider withdrawing his amendment. I understand why he raised the issue and he was right to do so. I appreciate the concerns of the organisations to which he referred.

8.15 p.m.

Lord Cope of Berkeley: My Lords, I am reassured by what the Minister has said and by the fact that the definition has been used by successive governments of different political persuasions over the years. I hope that those who mentioned the matter to me will be similarly reassured. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Lucas moved Amendment No. 101:

    Page 84, line 39, at end insert--

(""data" includes information in any form;").

The noble Lord said: My Lords, I wish briefly to have another attempt at seeing whether the Government will enlarge on the definition of "data", which is incorporated, among other places, in the definition of "key" on page 60, line 5.

The Government wrote to me after our debate in Committee saying that they were satisfied that "data" was a wide enough concept to cover everything that might be a key to electronic data or cover the other

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uses of the word "data" in the Bill because anything that could be used as such a key was reducible to data. If the Minister can point me to any legal definition of "data" that is stretchable in that way, I should be enormously grateful.

I have a couple of examples. The most obvious is that the key is a physical key, as we all understand it. I do not see how such a key or its lock can be reduced to the concept of data. Then there is a slightly odder possibility. Let us suppose that there is a niche which is aligned with a fairly random array of electronic sensors and the key is the Dispatch Box which is in front of the noble Lord. When the Dispatch Box is inserted into the niche, the sensors record values which correspond to the key necessary to unlock data.

The values of the sensors constitute data but it is very difficult to say that the Dispatch Box is data under any normal use of that word. But the Dispatch Box is the key which someone is required to disclose. Or one can present a finger to a sensor. If one is not very careful, it is possible to fall the wrong side of the definition of "data" which is in this Bill and the key is therefore not discloseable because the key itself is not data, although it generates data.

I merely request that the noble Lord looks at this matter again. I shall not raise it further. I beg to move.

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