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Baroness Anelay of St Johns moved Amendment No. 22:
- Page 4, line 42, at end insert "for a period of three years after the granting of a licence"
The noble Baroness said: Clause 6 states that an order may introduce rules that make the keeping of records compulsory by those to whom export licences are granted. I have tabled this probing amendment simply to ask the Government to put on the record the reasons why the dummy orders are inconsistent in the length of time laid down for keeping such records.
The Export of Goods, Transfer of Technology and Provision of Technical Assistance (Control) Order and the Trade in Controlled Goods (Control) Order state that the records shall be kept for three years. Both those orders deal with military exports. However, the Export of Objects of Cultural Interest (Control) Order requires that records be kept for four years.
On 16th October 2001, in another place, my honourable friend Mr Robert Key asked the Minister—at col. 127 of the Official Report—to explain that discrepancy. It does seem odd that the world of art exports should be subject to greater bureaucracy than the world of arms exports. The Minister could not offer an answer on that occasion, but he offered to write to my honourable friend. I am simply repeating the question, hoping that, after some months, the Government are now able to offer a stunningly simple and persuasive answer. I beg to move.
Lord Redesdale: I am grateful for that explanation. I was concerned that the amendment requires records to be kept for only three years whereas financial records must be kept for a good deal longer. I should be grateful if the Minister could tell us why the Bill should require that records be kept for a mere three years rather than, say, six years.
Lord Sainsbury of Turville: I shall deal first with the amendment and then with the tricky question of three years versus four years. The amendment seeks to ensure that orders under the legislation can require that records be kept for only three years. I shall explain why the Government do not think that that restriction is appropriate.
A number of our export controls derive from our membership of international organisations, in particular the European Community. Those organisations may require exporters to keep records for certain lengths of time. Amendment No. 22 could prevent the Government from fulfilling our European Community obligations and our international commitments, or could prevent the Government from responding to any changes required of the UK. For example, the EC regulation governing exports of dual-use items requires records to be kept for at least three years from the end of the calendar year in which the authorised act—the export or technology transfer—took place. That requirement is therefore reflected in the dummy draft orders that we published last October to indicate how the Government intend to use the powers in the Bill.
Under the proposed amendment the Government would be unable to include this provision and hence unable to require UK companies to comply with the EC regulation. Moreover, the amendment would also prevent the Government from implementing any longer record-keeping requirements which might be proposed by the EC or other international organisations in future. Any failure to provide for the enforcement of directly applicable provisions of Community law can, of course, lead to infraction proceedings being taken by the Commission in the European Court of Justice.
Why are the record-keeping requirements in the dummy draft orders different for cultural and strategic exports? On 19th October my right noble friend Lady Blackstone wrote to the chairman of the Standing Committee in the other place regarding the point raised by the honourable Member for Salisbury,
addressing the difference between the DTI and DCMS dummy draft orders in respect of the lengths of time which exporters will be required to keep records of any goods exported under the authority of a general licence. She agreed that it would be sensible for both departments to have the same requirement. Therefore, she was content that any orders made by her department should specify three years for the keeping of records. So now we have what is dear to all civil servants and others-complete consistency across the legislation. Having explained why we think that it is wrong to put a precise time limit in the Bill, I hope that the noble Baroness will withdraw her amendment.9.30 p.m.
Baroness Anelay of St Johns: The Minister managed to be precise, simple and persuasive in one fell swoop. I am most grateful to him for putting on the record the explanation provided by the noble Baroness, Lady Blackstone, and for stating that there is now unanimity across the orders. I agree with the Minister that a rigid time limit should not be put on the face of the Bill. I mentioned it merely as a vehicle to obtain an explanation from the Minister. I therefore beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Miller of Hendon moved Amendment No. 23:
- Page 5, line 3, at end insert ", but such disclosure shall not be permitted except insofar as is necessary in order to monitor or enforce compliance with the order or any licence granted under it, and shall only be permitted on condition that the recipient shall treat such material as confidential"
The noble Baroness said: It is clearly necessary that information may be properly demanded to be kept or provided for the purposes of what I may loosely call the operation of this Bill. The relevant paragraphs are (c) to (f) of subsection (1) of Clause 6. However, paragraph (f) implies that any information contained in the records that are required to be kept under paragraph (c), or provided under paragraphs (d) and (e), may be disclosed to what the paragraphs call "persons".
The amendment requires that information obtained under the powers of the Bill shall be used only for the purposes of monitoring or enforcing compliance with the Bill and that the recipient shall treat the material as confidential. The reason for this requirement is to comply with the Human Rights Act which seems for some reason to have been overlooked by the draftsman in this particular case.
Perhaps the Committee will recall the Guinness case, and in particular the conviction of Ernest Saunders who was required to give evidence to the inspectors conducting an inquiry under, I believe, the Companies Act. The information that he was compelled to give was then used against him in his subsequent prosecution in breach of his rights against self-incrimination.
This amendment is intended to ensure that records and information will, as I said, be used for the purposes of this Bill and nothing else. There should be no disclosure to potential competitors; no disclosure to other governments or NGOs and no disclosure to other government departments. Here I have in mind the fact that this Bill will largely be administered by Customs and Excise. It would be wrong for information obtained for the purpose of the administration and enforcement of this Bill to be passed on to the VAT department of Customs and Excise. It is correct that any order under this subsection, including the provisions of paragraph (f), is subject to parliamentary scrutiny. However, bearing in mind how limited such scrutiny is, it is essential that the parameters of the disclosure should be defined within limitations laid down in the primary legislation. I beg to move.
Lord Sainsbury of Turville: This amendment seeks to place conditions on the Secretary of State's power to disclose information obtained through an order under the Bill. The Government require the power to obtain and share information connected to export licensing issues for two reasons. By virtue of its membership of a number of international organisations, the UK is committed to disclosing certain information to these bodies. Specifically, under the UN arms register and the Wassenaar arrangement, we are required to provide details of the numbers of certain categories of military or dual-use goods exported each year. The Government also wish to have the power to exchange information within Government, for example with HM Customs and Excise, for the regulation and enforcement of export controls and investigation or prosecution of offences.
The amendment proposed would restrict the uses for which the Government could share information to monitoring and compliance and require any such information sharing to be in confidence. The result would be to prevent the Government from meeting their international reporting obligations. In view of these arguments, I invite the noble Baroness to withdraw the amendment.
Baroness Miller of Hendon: I hear clearly the Minister's response. I shall withdraw the amendment. However, rather than simply stating that the power is left to the discretion of the Secretary of State, the provision should add specifically, "because of international agreement" or whatever it may be. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Miller of Hendon moved Amendment No. 24:
- Page 5, line 9, at end insert—
The noble Baroness said: This simple amendment is self-explanatory. It provides a defence for someone who innocently supplies goods, technology or technical assistance in breach of a control order.
Members of the Committee will recall the notorious Matrix Churchill case where tubes were supplied ostensibly for an oil pipeline when it transpired that they were intended for the purposes of a so-called super gun. While providing a defence, this clause imposes an onus of proof on the defendant which I expect will be extremely difficult to discharge. There can be no grounds for creating an absolute offence in circumstances where a person, possibly even a sub-contractor, may be relying entirely in good faith on information supplied by his customer. I beg to move.
"( ) It shall be a defence to any charge under subsection (1)(g) of an offence described wholly or partially by reference to the uses to which any goods, technology or technical assistance may be put that the person charged did not know and could not reasonably have been expected to know that there was a risk that the goods, technology or technical assistance in question would be put to such uses."
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