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I turn to the Army and the secret services. It is perfectly reasonable that the secret services should allow James Bond to bribe the head of SMERSH. Under those circumstances, the head of SMERSH would be acting improperly according to his own lights, but we would want very much to know about it. However, such action should be taken only with proper prior authority.
There is the saying that you cannot buy an Afghan, you can only rent him. The other day it was noticed that the Italians, using traditions that go back deep into the inter-city state politics of the 12th century, bribed the Taliban to keep quiet all around them, and the area was peaceful. I do not know whether that is right or wrong, but it may be possible to argue that such behaviour should be allowed as a public interest duty. It was noticeable that after they forgot to tell the French that they had been bribing, 10 or 11 French people were killed, which was serious. We should not hamper the Armed Forces or the dirty work of espionage agents by not allowing them, with high-level prior consent, to behave in that way.
This is a very good Bill, except for Clause 12. I certainly support it and repeat that it was a privilege to serve under the noble Viscount, Lord Colville.
Lord Mayhew of Twysden: My Lords, I enthusiastically follow my noble friend's encomium on the chairmanship of the noble Viscount, Lord Colville of Culross. It was a great privilege to sit on his committee-and also rather good fun.
Many of the points that I might have made on this important Bill have already been made by noble Lords. I hope that brevity will not seem superficial. I cannot refrain from making at the outset of my brief remarks
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The whole point of a joint scrutiny committee is frustrated if it is not given a reasonable time for its work. I think that the Government acknowledge that we should have been given a minimum of 12 weeks. We were given 10. In consequence, some aspects of our work, notably with oral witnesses, had to be inappropriately curtailed. This was a pity, because the great merit of the Bill and its proclaimed purpose is that it provides for a new scheme of consolidated bribery offences, to cover bribery here and abroad, in place of the hotchpotch of legislation-referred to already-going back at least 120 years. The Minister said that it went back to Magna Carta. This is a long-called-for undertaking which is well worth taking time over to be sure that we get it right.
The definition of bribery in the early clauses of the Bill might have yielded some of its undoubted complexity had we had more time to explore the matter. I am afraid that I continue to find it a real candidate for a cold towel around the head, and I do not envy those who will have to explain it to a jury or, in the case of legal advisers to corporations, to companies. They may well be hard pressed to explain the Act with the confidence required of them by their employers. For my part, at any rate, I shall await with a good deal of concern progressive news of how the definition works out.
It would, however be graceless not to match that disgruntled complaint, and perhaps to exceed it in importance, by congratulating the Government on abandoning the old requirement of a principal-and-agent relationship and, instead, adopting a conduct test. Time will tell whether hingeing that test upon the concept of improper performance of a relevant function or activity will prove more serviceable than relying on the simple-or at any rate, single-adverb "corruptly". I note the evidence cited by the noble Viscount, Lord Colville, on the varying ways in which courts have treated that. It was obviously an important point.
I am also pleased that for the specific offence of bribing a foreign official the Government have provided that the conduct in question will amount to bribery when the official is neither requested nor required by the applicable written law to be influenced by the offer, promise or giving of an advantage. In other words, it has to be by written law for the conduct not to amount to bribery; evidence of established but unwritten custom or whatever will not suffice to exclude it from bribery. We went into this with witnesses with some care because it is such an important matter-in the commercial context, in particular. We elicited from them that this would be an appropriate and practical formulation and I am grateful that the Government have adopted it in this amended Bill.
Thank goodness, too, that in the new offence targeting companies which fail to prevent bribery by persons acting on their behalf, the Bill no longer focuses on whether a "responsible person" was negligent rather than on the collective failure of the company to have in place adequate anti-bribery procedures. I am grateful for the assurance that we will have guidance in that
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We have heard a great deal about Clause 12 and I do not need to repeat it, save to say that I thought that the noble Lord, Lord Pannick, made an absolutely devastating criticism of the decision to keep it. I think that that is right and I listened with much sympathy to the speech of my noble friend Lord Patten. However, I think that we were right to recommend that the clause be removed from the Bill on the basis of the evidence that had been given. It is worth reminding the House briefly of what is said at paragraph 202 of our report:
"Transparency International UK told us that any decision to pursue these proposals should be taken through a more appropriate piece of legislation".
I warmly agree with that. Transparency International said:
"While we welcome the Government's openness in acknowledging that bribery may be used by the security services, we have the gravest doubts as to whether any worthwhile long-term national interest is served. If the security services can make a case for such an 'opt-out', they should present it for appropriate parliamentary scrutiny; and it should form no part of any general law of bribery".
I suggest that it is very hard to argue against that. We said at paragraph 203:
"We heard no persuasive evidence of a need for the domestic intelligence agencies to be granted an authorisation to bribe. Neither are we persuaded that this draft Bill is the appropriate vehicle to extend the security services' powers to contravene the criminal law".
The noble and learned Lord, Lord Woolf, made a very telling point when he said that if it can be shown that it is in the public interest for such a course to be taken, that militates conclusively against a prosecution being authorised. That is another good reason why the Attorney-General should retain the jurisdiction that she has at present.
Lastly, and not only as a member of the well-known ex-Attorneys club, I was very pleased to read in the Government's response to our report, at paragraph 25, that they do not now intend to bring forward any legislation relating to the Attorney-General. As my noble and learned friend Lord Lyell of Markyate said today, parliamentary accountability demands that the Attorney-General's constitutional role remains in place.
We have waited long enough for an acceptable anti-bribery Bill to meet both our domestic and our international requirements. My strong feeling overall is that this offering deserves our warm support and that we should now get on with seeking to make it even better.
Lord Elystan-Morgan: My Lords, the book of Ecclesiastes reminds us that there is no new thing under the sun, and bribery and corruption is certainly one of the oldest institutions known to man. It has riddled the civilisations of China, of Suma, of Greece
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The consideration given in the past 14 years to this matter has certainly been comprehensive and rigorous. Indeed, one could start earlier than that with the Salmon commission of 1976, which dealt with the matter, but the real genesis was the Nolan Committee on Standards in Public Life, in its report of 1995. From that point onwards, there has been an irony. One can identify 12 different stages from White Papers, reports, committee examinations-including the sterling work done by the committee chaired by my noble friend Lord Colville of Culross and the work, already referred to, carried out by the noble Lord, Lord Slynn. Therefore, one has the sense of legislative soil that is well harrowed, but somehow, the Bill ended up-if I may mix my metaphors-in a rather vulgar sprint, with more rush than would have been anticipated.
Be that as it may, I am quite sure that the Bill is a progressive development and one to be greatly welcomed. I am sure that the Government were entirely correct in centring on the concept of proper or improper behaviour. Once one has the proper heart, core and kernel, the rest of the Bill falls into place. That is very much as happened with the Theft Bill 40 years ago, when the concept of appropriation suddenly took over from all the difficulties there had been with the previous Larceny Acts. Nearly everything else then fell into place. It may not be all that simple. The point has been made that the definition of impropriety may be embarrassingly wide in relation to certain prosecutions.
I wonder whether the Government have thought carefully about including, in addition to the question of impropriety, the test of dishonesty. Dishonesty is well understood by juries; it was defined very clearly by the Court of Appeal in Ghosh 25 or 27 years ago. The House will remember the two tests. First, the jury has to decide the objective test: is the conduct that has been proven against the defendant such that, according to an objective view, one would regard as dishonest? That is test one. If the prosecution overcomes that hurdle, there is the second test, which is seeing through the eyes of the defendant. Did the defendant appreciate that it was dishonest-not according to his base ideas of honesty, but according again to the standards of ordinary, decent people?
In other words, that is a totally objective test and a subjective test according to objective standards. That may sound complicated, but I do not think that it is. Judges and juries have been able to cope with that very well. Would we lose anything if we had such a test to clarify the meaning of that rather wide term "impropriety" in relation to the main structures of the Bill? I suggest not.
There may be another reason for introducing a reference to dishonesty. The Explanatory Memorandum states that it is not anticipated that there will be a very considerable increase in the number of prosecutions, nor indeed that there will be any greater pressure on prison places. One may ask rather tartly: if you are developing a new mouse trap, what is the point if it does not catch mice? But that is not the point of this
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There was a note published by the Library of the House of Commons in April this year, dealing with the Bill as it then stood. It set forward this fact: between 1997 and 2003 the average number of prosecutions each year for this offence was 21. That is a very low figure, especially considered side by side with the average number of prosecutions for the offence of fraud in the same years, which was of the order of 23,000. Nobody would for a moment suggest that only 21 cases of bribery and corruption occurred in the United Kingdom during that period. Nobody would suggest that it was as low a figure as 210 or indeed 2,100.
Offences of bribery and corruption, as every Member of the House appreciates, are very different from burglary offences; you know when those have happened. With rape offences, you will know when some of those have happened, as complainants all too often will not go to the police, although when they do the offences are recorded. The same applies with robbery and so many other offences. Bribery and corruption is not like that. There is often no conscious victim. There is often no overt evidence at all that anybody can track down.
This is where we come to Clause 12. I have the utmost respect for the submissions made by the noble Lord, Lord Pannick, and the noble and learned Lord, Lord Woolf, in this matter. The defences deal with two main areas. One is entrapment, which is not the nicest way of going about a prosecution, nor something that juries like and appreciate. Nevertheless, in some circumstances it is the only way that the root of evil can ever be got at. In many cases the actual payment of money by authorities will be necessary, not because it is right to do so, but because all the other alternatives are worse.
On that basis, we must have one of two things. Either one should have Clause 12, with all the checks and reservations, including the discretion of the Attorney-General and everything else, considered in this matter. Or we might consider including the test of dishonesty in relation to these situations. If you have the test of dishonesty, it may not be necessary to have Clause 12.
The most pertinent remark was made by the noble and learned Lord, Lord Lyell of Markyate, when he said that it is not the law that is the problem, it is getting at these situations and exposing them. Unless there is a commitment by the community to invest money and human resources in order to smell out and root out these situations, then the main problem will remain with us.
I would like to apologise to the House: in the Grand Committee, there is a matter involving the Welsh language, a subject very close to my heart. I would be grateful if the House would forgive me if I leave now-meaning no any discourtesy to anybody who is going to speak-for a matter which I hope will be dealt with shortly. It is not a complete defence, but I hope it will be a substantial mitigation.
Lord Thomas of Gresford: My Lords, I too was a member of the committee which considered the draft Bill. I join in the tributes that have already been paid to the chairmanship of the noble Viscount, Lord Colville of Culross, who curbed a number of us-I put myself foremost among the offenders-from asking too many questions and conducted those proceedings admirably.
This is a good Bill. It revises ancient legislation that is completely out of date and that does not cope with the present circumstances. I found the G8 St Petersburg summit communiqué of 16 July 2006 a very good statement of the current problems. That communiqué said:
"Large-scale corruption by individuals who hold senior executive, judicial, and legislative positions can have a devastating effect on democracy, the rule of law, and economic and social development. We recognize",
said the Governments concerned at the G8,
That is a concise statement of the problem as it applies worldwide.
My late noble friend Air Marshal Lord Garden, whose departure I much regret, was an adviser to Transparency International on the prevention of corruption in the official arms trade. On 14 December 2006, he said to this House:
"The United Kingdom has a slightly iffy reputation on the use of money to facilitate defence contracts. I should have thought that it was in the national interest to clarify that. If-and I say if-commissions are paid in a corrupt way, it makes for an inefficient defence industry, so we pay more at home for our defence equipment, and it undermines Governments overseas, so we reduce our security".-[Official Report, 14/12/06; col. 1716.]
That is a very wise insight into the problems of the defence industry in this country.
In introducing the Bill, the noble Lord, Lord Bach, said that he disagreed with the suggestion that the existing law is fully compliant with international obligations. I take issue with him on that. Transparency International has pointed out problems but the OECD working group on bribery also has been active. It has, going back five years, made four demands of this country that we should revise our law. Whereas the signatories to that convention number 36, 35 had complied years ago, but we had not updated our law. The working group said:
"In light of the numerous issues of serious concern, the Working Group has requested the UK to provide quarterly written reports on legislative progress".
"Current UK legislation makes it very difficult for prosecutors to bring an effective case against a company for alleged bribery offences".
That was in its report in 2008. So your Lordships will appreciate that there is a problem which is recognised internationally and that this Bill addresses that problem.
Perhaps I may first refer to the definition of bribery. The noble and learned Lord, Lord Woolf, said that what is meant by bribery is difficult to define exactly,
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It is difficult to define bribery exactly. The noble and learned Lord, Lord Lyell of Markyate, said that this Bill is too complicated; that "improper" means a large number of things. Well so it does. However, it is only in the court that the facts and the context can be investigated and it is only then that one can determine what label one should apply to what has happened.
What should always be remembered by your Lordships is that the prosecution rarely has to prove every ingredient in an offence. There is an issue in a case. Sometimes there are two issues, but generally speaking there is only one. Under current procedures a defence statement requires the defence to define the issue and then an agreed set of admissions will cover many of the facts which the prosecution would otherwise have to prove. That is modern criminal procedure.
Clauses 1 to 5 can be reduced to a couple of simple propositions. First, was an advantage given or received-that might be the issue in the case. Was it to induce a reward or reward a person for the improper performance of a function? Secondly, is that function caught by the act? Is it a function that should be performed in good faith, impartially or in performance of a trust? That is really Clauses 1 to 5. One can pick out the particular ingredient a case is about, define it and simplify it for the jury. Although the wording of these clauses is quite complicated, in fact the case as presented in court will undoubtedly be refined to a very large degree.
A number of issues have been discussed. I refer, first, to the question of guidance. On pages 46 and 47 of volume one of its report, the committee refers to the Foreign Corrupt Practices Act 1977 in the United States which provides that a rebuttable presumption will arise that acting in accordance with advice will mean that no offence has been committed. The Attorney General of the United States is required to provide an advisory service so that a company that is wondering whether a set of proposals could amount to bribery can go along to the Attorney General's office and get advice.
In Hong Kong, the Independent Commission Against Corruption has brought Hong Kong to the standing of third of the least corrupt countries in the world by its rigorous stamping out of corruption. It has a Corruption Prevention Department which created an Advisory Services Group in 1986 which has advised more than 3,000 private companies. The committee points out, as the noble and learned Lord, Lord Mayhew, mentioned, that there was not time to carry out a further inquiry to explore the ICAC in any detail. It is a body that I have personal connection with over a number of years. Something like an advisory service would be a very good thing for British industry. Indeed, the noble and learned Lord, Lord Mackay of Clashfern, pointed out:
"The Department of Trade and Industry could give guidance. It would not be conclusive but it would be authoritative".
It so happens that this morning I decided to look at what sort of advisory service is provided by the trade and industry department. It does indeed have one, so I filled in a query form asking how to avoid bribery in a particular overseas country, and sent it off. I understand that it takes around seven days for a reply, and I shall inform your Lordships in due course if a response ever comes.
The tax advisory teams of Her Majesty's Revenue and Customs provide advice to companies and individuals on whether what they are doing is legal so that they can act accordingly. I was heartened, as was the noble Viscount, Lord Colville, by the reference of the noble Lord, Lord Patten, to strong ethical corporate structures as being the real key to preventing corruption, but I cannot quite go along with him when he says that no guidance will help in the long term and that you cannot rest on something written on a scrap of paper that can be cast aside and forgotten. There is some truth in that, but a proper advisory service might be a good thing.
I turn now to Clause 12. The noble Lord, Lord Pannick, said that exemptions such as those outlined in the clause raise difficult and sensitive questions about the rule of law. That took me back to the statement made by the noble and learned Lord, Lord Goldsmith, in December 2006 where, in talking about the stop put on the BAe investigation, he said:
"It has been necessary to balance the need to maintain the rule of law against the wider public interest".-[Official Report, 14/12/06; col. 1712.]
That is an interesting balance because I would have thought that the rule of law was the overriding public interest. However, what the noble and learned Lord, Lord Mackay of Clashfern, has said about that is:
"If it is necessary in the public interest, a prosecution should not occur and agencies can inform the director accordingly".
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