- (1) It shall not be lawful for any company, firm, or individual after the expiration of six months from the passing of this Act, or such longer periods as the Board of Trade may in any particular case allow, to carry on the business of extracting, smelting, dressing, refining, or dealing by way
1014 of wholesale trade in metal or metallic ore to which this Act applies, unless licensed to do so by the Board of Trade: Provided that the purchase of metal by persons for the purposes of use in their trade shall not be deemed to be dealing in such metal by way of wholesale trade where the trade carried on by the purchaser is not primarily the trade of dealing in metals.
- (2) In the case of a company, firm, or individual with respect to which any of the conditions set forth in the Schedule to this Act apply, no licence shall be granted unless the Board of Trade are of opinion that for any special reason the grant of a licence is expedient, but save as aforesaid any company, firm, or individual carrying on or proposing to carry on such business as aforesaid shall, on making application in the prescribed manner, and on furnishing such information and allowing inspection of such books and documents as may be reasonably required, and on payment of the prescribed fee, be entitled to a licence under this Act.
- (3)A licence under this Act, unless suspended or revoked, shall remain in force until the first day of January following the date of issue of the licence, but shall be renewable annually, and the same provisions shall apply to the renewal of the licence as apply to the grant of a licence.
- (4)The Board of Trade, if satisfied by evidence not before them at the time when the licence was granted that such company, firm, or individual is, or has become, subject to any of the conditions set forth in the Schedule to this Act, may revoke or suspend the licence.
- (5)If any question arises between the Board of Trade and any company, firm, or individual, as to whether or not any of the conditions set forth in the Schedule to this Act apply in respect of the company, firm, or individual, the question shall, subject to rules of Court, be referred by the Board of Trade to the High Court for determination, and on any such reference it shall rest with the company, firm, or individual to show that none of such conditions as aforesaid apply, and the decision of the High Court on any such reference shall be final, and no appeal there from shall lie to any other Court.
- (6)Where at the expiration of the said six months or longer period allowed by the Board of Trade, or at any time when a licence expires, proceedings on any such application are pending in the High Court,
1015 the Court may, on application being made for the purpose, extend the said period of six months or longer period as respects that company, firm, or individual, or as the case may be, the duration of the licence, for such period as may be necessary to allow the question to be determined by the Court.
- (7) References in this Section to the High Court shall in relation to Scotland be construed as references to the Court of Session.
§ Mr. A. STRAUSS
I beg to move, in Sub-section (1), to leave out the words "extracting, smelting'' ["winning, extracting, smelting, dressing"]
There was a meeting of various smelters, of copper, tin, spelter, and lead, to consider this Bill, and how it affects their industry. It represented all sections of those engaged in the industry, and arguments for and against the Bill were advanced. Nevertheless they passed the following resolution, which I will read:That this meeting, while approving of the avowed objects of the Non-Ferrous Metal Industry Bill. is of opinion that these objects are in no way attained by the Rill as it now stands. and deprecates any interference with the present means of obtaining supplies of raw materials until it is clearly shown that other satisfactory means will he substituted for them.It must not be forgotten that these smelters are interested in getting the ores they require, and unless there had not been some slight disadvantage to their business under this Bill I do not think they would have passed this resolution. I was present at the meeting and heard the arguments put forward, and I consider that they are really unanswerable. So far as the bulk of the ores are concerned they have mostly been contracted before they were shipped from the mines, but large quantities of ores could be brought, over which the enemy would have no control. But in addition to that, there were very large quantities of ores, particularly copper and tin ores, which were sent to this country unconsigned, to he sold to the highest bidder. When they arrived here of course nobody could bid for them, except some foreigners and the English smelters. That was the chief source of this industry from which the English smelters obtained their supply of ores, because the foreigners could not compete with the English, having to pay freight, insurance, and various charges; so that the ores which came to this country unconsigned were really the 1016 best market with the English smelters. What we are doing by the Bill would affect this supply of ores which we have been in the habit of receiving in this country, cause those who sent the supplies knew that they would find the greatest competition in this country to obtain them, and that they would get the highest prices. Under this Bill they would discontinue to send the ores here, because there would be no competition here, except a restricted competition, the English smelters being few and far between, and the ores, instead of being sent to Liverpool or Swansea, will be sent to Hamburg and elsewhere. We would thus find a great scarcity of ore, which would be a disadvantage to us, and the enemy would buy those ores in Hamburg. It would be an absolute advantage to British industry and British smelters that smelting and extracting should be done here, and that the supply of ores should not be interfered with. Under these circumstances, I submit that there can be no objection to leaving out these two words. The object of the Bill, as we understand the Government, is that. enemy control should cease in the future. I admit that if these two words are omitted the enemy may be able to smelt tin or copper here, but where is the harm? They could not buy the ores here, nor would any man influenced by the enemy be in a position to do so, and they would only be able to smelt imported ores and export them again. Though a certain amount of labour might be employed they would be absolutely unable to take any advantage of their process, or in any way to obtain control of the metals. They would only be able to smelt as much metal as they would be able to buy abroad and to again export it. The object which the Government have in view of putting an end to enemy control cannot possibly be affected by leaving out. smelting and extracting.
§ 4.0 P.M.
§ The PRESIDENT of the BOARD of TRADE (Sir Albert Stanley)
I am sorry we cannot accept this Amendment. It is quite clear that the object of the Amendment is to remove from the purview of the Act the process of extracting and smelting non-ferrous metals in the United Kingdom. On the Second Reading, and certainly at the later stages, it was made clear that one of the means adopted by Germany for securing control 1017 of non-ferrous metals was either to secure by ownership the control of the smelting and extracting plant or by agreement to secure that control. I pointed wit that it was really essential in the interests of this country that we should establish smelting and extracting plant. One of the objects of this Bill is to encourage the industry, so that these particular plants will be established in the United Kingdom and established absolutely free from German control. Our control in this direction was allowed to pass into the hands of Germany, and because of our neglect in this respect we placed this country under grave disability, and we are trying to secure that that shall not occur again. With regard to the meeting of the Smelters' Association to which the hon. Gentleman referred, my information is to the effect that that meeting was not really representative. Whether it be representative or not, and I have grave doubts on that point, I am quite clear that to accept this Amendment would mean that the real object of the Bill would be destroyed.
Sir A. STANLEY
I beg to move, in Sub-section (1), to leave out the words within the United Kingdom."
If hon. Members will carefully read the Clause, they will see that these particular words relate only to dealings in the United Kingdom, and not to the business of winning, extracting, smelting, dressing or refining. These words become unnecessary in view of the second proviso to this Clause, which was moved at a later stage in Committee, and which not only covered dealings, but also covered winning, extracting, smelting, dressing, and refining. So that the words are really redundant.
§ Sir ARCHIBALD WILLIAMSON
As the proposer of these words, I agree with the right hon. Gentleman that the second proviso seems to achieve the object I had in view, and therefore I hope that the House will agree to the Amendment.
Amendment agreed to.
§ The SOLICITOR-GENERAL (Sir Gordon Hewart)
I beg to move, in Subsection (1), after the word "where" ["where the trade"], to insert the words "such purchase or sale is incidental only to".
1018 This is to be followed by another Amendment, and the proviso will then read, "Provided that the purchase or sale of metal shall not be deemed to be dealing in such metal where such purchase or sale is incidental only to the trade carried on by the purchaser or seller." It will be remembered by Members of the House that in the course of the various discussions on this matter questions of importance were raised as to what was the meaning of "primarily" and under what circumstances a transaction might be called isolated. I have in mind more than one speech by the hon. Member for Hexham (Mr. Holt) on this subject. We undertook to endeavour to find a form of words which would put at rest all these doubts and controversies, and I venture to submit that these words carry out that object.
§ Mr. LEIF JONES
I congratulate the Government on having found this form of words, which I think will dispense with the necessity of the taking out of a licence in the case of people affected.
§ Mr. PETO
I should like to be quite sure that this does not do a great deal more than put us back into the position we were in before the Debates in Committee. The original proviso was intended to cover only the question of purchasing metal for use in a person's trade. It was pointed out by several members that in those cases you must have power to sell surplus metal. The chemical industry was instanced, and other speeches were made on similar lines. Subsequently it became quite clear that those who advocated the proviso in the form in which it now appears unamended in the Bill had wholly other purposes in mind. For instance, the hon. Member for Aberdeenshire West (Mr. J. M. Henderson) made a speech of four lines, in which he said:I have no objection to this Amendment. and for this reason, the more you go on the more futile and absurd the Bill will turn out to be.At the end of the Debate the right hon. Gentleman the Member for Dewsbury (Mr. Runciman) made it quite clear also what was his view about these Amendments to the proviso. He said:I am glad to think that the Government is accepting it. It strongly justifies the strong opposition shown to the Bill in the early stages and illustrates the futility of attempting to conduct national trade on a licensed basis.That may or may not be so, but those in favour of the purposes of the Bill always understood that the Government should 1019 have the power of controlling this trade in metals, and particularly the sort of trade that has been conducted in the past and which has given practically complete control of the metal industry of the Empire to persons of alien origin and who are not British subjects. We thought that in drawing the teeth of the Bill, so to speak, this proviso was regarded as the crux of the whole matter. In Committee the proviso so altered was universally accepted by the opponents of the Bill. It was only opposed by the hon. Member for Birkenhead (Mr. Bigland) and by the right hon. Baronet the Member for the City (Sir F. Banbury), and one or two other Members. Although the right hon. Baronet is not in favour of the Bill, yet. he alone among those who used to be considered Unionist Members saw what the purpose was of these wrecking Amendments. I want to be quite satisfied that by these words, which are now accepted as satisfactory by the opponents of the Bill, we have not still left it open to any foreigner to have executed for him any order of any magnitude whatever for purchase or sale or entry into a contract for the entire output of a group of British mines for a series of years, provided only that it can be said that it was incidental to his trade. It seems to me that these words cover a great deal more than the purchase of metal for the purpose of the chemical industry or for the purchase of lead for covering roofs and the sale by people in essential industries of the surplus metal afterwards. That was the original intention of the Government, and I should like to know how far they have gone away from their original intention and left it open to people to engage in transactions of any magnitude as long as they are alleged to be isolated transactions.
§ Sir C. HENRY
I am the Member who proposed this Amendment, and I think I should be the last person to be accused of desiring to wreck this Bill. One of the arguments, indeed, used against this Bill has been that it has received to some extent my support. I do not know if the hon. 1020 Member was here when I first introduced this Amendment, but I then stated particularly what my object was, and that was not to hamper the trade of individuals in this country unnecessarily. My hon. Friend said that under this provision at present anyone in Germany could send orders to this country for any quantity and of any magnitude. This Amendment does not affect that point one iota. As the Bill was originally introduced, anyone in France or the United States, or Germany, or any other country, could send an order to a broker in this country and have that executed without any violation of the provisions of this Bill. This Amendment has the effect of placing the Britisher at no greater disadvantage than the foreigner.
§ Mr. J. HENDERSON
I very much approve of this Amendment. As I understand, the President of the Board of Trade is anxious to encourage smelting in this country. What happens to smelters? A smelter of copper, whose business it is to buy the ore, smelt it, and convert the copper into all kinds of things, is constantly compelled from time to time to make up his quantities, or to have an excess quantity to dispose of. My right hon. Friend will quite understand that when you buy 1,000 tons of ore you can never tell what the exact quantity of copper will be produced in ingots when smelted. You may have got your orders in advance for so many tons to come out of that. It falls short of the quantity. Therefore to fulfil your orders, you must go into the market to make up the deficiency. On the other hand, the ores may work out more copper than you anticipate. In that case you have a surplus which you must also dispose of in the market. It would be a very stupid thing and very hard on traders, who are conducting business on these lines, who have no concern with Germany or any other country, to compel them to take out licences for the purpose of carrying on their own legitimate business which they have been carrying on for many years. When you buy ores you can never tell exactly the amount of copper you will get. When the ore is worked up a great deal falls into the bottom of the furnace, and is not recovered sometimes until a year or two years afterwards, so that you can never quite tell the exact amount of copper a 1,000 tons of ore will produce, and if it does not produce the amount you estimated you have to buy copper. If, on 1021 the other hand, it turns out more you have to sell your surplus. Therefore, I quite approve of this Amendment.
§ Mr. STRAUSS
The wording of the Amendment of the right hon. Gentleman is certainly a great improvement on the word "primarily," which leaves the door open to a great deal of fraud. All that a smelter metal merchant would have to do would be to join a big timber or sugar merchant or any other merchant whose business would be primaily in timber or sugar, and of course that firm would not have to obtain any licence under the Bill if the word "primarily" were retained. I think the words now proposed are better calculated to stop any fraud of that kind.
§ Mr. BIGLAND
I would like to ask the meaning of the words in the proposed Amendment "incidental only to." If I read it aright, a man who wishes to speculate in copper, if this Amendment is passed, will have to take out a licence, and I do not see any reason why those operating on the smelter markets in London should not be asked to take out a licence. The actual application for a licence from any British well-known firm must be a very simple matter, and I cannot see why it should not be done in order that the President of the Board of Trade may really know who are operating on the market. One speaker has just said that anybody from any part of the world may telegraph to a licensed broker on the London metal market to exercise an order for him. That is perfectly right, and every London metal broker will be very careful, if I understand this Bill, to see that he does not act under any foreign influence in such a way as would jeopardise the reissue of his licence, and the reason we supported the acceptance of the previous Amendment that was moved in Committee was this fear that speculators in England would not require any licence whatever. To my mind, after peace is declared, for the five years this Bill contemplates, those of us who are in the trade will have to recognise that we shall not be allowed to run our business quite as easily and smoothly as before, and that it is essential, in order to safeguard labour and industries, that we must put it in the power of the Government to see that such necessary restrictions are carried out. I approve of the proposal if I can be assured that the ordinary gambler and speculator on the metal market will have to take out a licence.
§ Sir A. WILLIAMSON
I think the House will be well advised to pass this Amendment, because it is directed surely to simplifying the ordinary matters of trade, and would not have the effect at all, in my judgment, of touching the case of the smelter who makes a miscalculation in 1,000 tons as to how much copper he is going to get out, because that man must obviously be engaged in the trade and must take out a licence. But it is surely unnecessary for builders, who might collect from old houses a little lead which they might dispose of in the ordinary way of business, to take out a licence. Then there is the case of firms. who have an international trade, and who might in the course of that trade receive a small lot of ores from some client in payment, and which they release when imported. It is purely an incident in their business, and not at all the ordinary run of their affairs, and it is. unnecessary surely in such a ease for them to have to take out a licence and go, through the whole of the formula of having their books and accounts examined, and so forth. This seems exactly to meet the need the House foresaw.
§ Sir G. HEWART
Perhaps I may, by leave, make two observations in reply to the remarks which have been made, first,. by my hon. Friend Mr. Peto, and, secondly, by my hon. Friend Mr. Big-land. With regard to my hon. Friend opposite (Mr. Peto), I should like to. observe that this Bill deals only with wholesale trade, as is made plain in Sub-section (1) of Clause 1, and these words, "such purchase or sale is incidental only to," have been, I assure him, most carefully considered with a view to meeting the reasonable objection which came from, more than one quarter of the House. The arguments which my hon. Friend put forward did too little justice to the word "only." It is not enough for the purpose of this provision that the purchase or sale should be incidental to the trade. It must be "incidental only to the trade carried on by the purchaser or seller," and that in another form is the answer I venture to offer to my hon. Friend Mr. Big-land. There can be no real apprehension that under these words the gambler or speculator in these metals goes free. How can such a person be heard to say that a transaction of that kind in which he is engaged is a transaction "incidental only to" his trade? I hope the 1023 House will accept this Amendment, which represents on the part of those who are concerned with this Bill a real desire to meet what appeared to be a real objection.
Amendment agreed to.
Further Amendment made: In Subsection (1), leave out the words "is not primarily the trade of dealing in metals."—[Sir A. Stanley.]
§ Mr. HOLT
I beg to move, in Subsection (1), after the word "on" ["is carried on wholly"], to insert the words "in respect of metal or metallic ore which is."
When we had a discussion in Committee on these particular words, there was evidently a good deal of difficulty as to the proper interpretation of the words, "dealing is carried on wholly outside the United Kingdom." I remember the Lord Advocate, who dealt with the question with his accustomed courtesy and urbanity, himself found considerable -difficulty in exactly defining dealings in metals inside the United Kingdom and outside the United Kingdom. The case originally put forward by my hon. Friend the Member for Elgin and Nairn (Sir A. Williamson) was that of a firm which bought concentrates in Bolivia and shipped them to California. The exact amount of interest the English house has to take in the transaction, in order to make it dealing inside the United Kingdom, as opposed to dealing outside the United Kingdom, appears to be a very fine point. Apparently the English branch get some share of the profits, and certainly, as I understand from the Lord Advocate, if an English firm gives any instructions and exercises any brains in the matter, it is not a case of dealing out side the United Kingdom. What we want to do is to establish the fact that f the metal itself does not come inside the United Kingdom, then that is a transaction which does not require a licence. Take the case of an industry in this country which owns mines in Australia, South America, China, or wherever it may be. As I understand, if that company is going to negotiate a sale of property, or even give instructions from the head office in this country, it will require to take out a licence. Now I understood that the object in moving this proviso was that where the whole of the transaction took place entirely outside the United Kingdom, a firm resident in the United 1024 Kingdom would have the same liberty as a firm resident outside. I do not think the words now in the Bill give that liberty. I think they put a firm resident in the United Kingdom at a disadvantage in completely external transactions as compared with a firm outside the United Kingdom. If that is so, you run the risk of causing such a firm to transfer its head office. We all know quite well that the effect of taxation on similar trade has caused firms to remove their head office, and I am quite certain that where you have a trade which mainly or largely consists of transactions outside the United Kingdom, it will give a stimulus to the removal of head offices outside the United Kingdom, and so get out of the restrictions of the Board of Trade which firms will be able to do without injuring their business.
§ Mr. HEMMERDE
In seconding this Amendment, I would like to say it seems to me that not only would there be a tendency on the part of firms to remove their head office, but also a tendency in certain cases to remove branch offices, and so bring them out of the purview of the taxation of this country, which seems to be altogether undesirable in the interests of this country.
§ Sir A. STANLEY
I do not think that the hon. Member who has moved this Amendment quite appreciates what the effect will be. Perhaps he will allow me to give him some explanation of how we understand the Amendment will operate, and I hope he will then withdraw the Amendment. The effect of it, as I understand it, is that a German company or firm, established in this country, which was really under German control, could carry on transactions in these nonferrous metals or ores in a foreign country. They could, through these transactions, secure clients in this country, and they could carry on these transactions without requiring any licence whatever. It is a common practice in businesses of this kind for a firm to make a purchase of metals abroad, and for them to arrange for the transfer, the shipping, of this purchase direct to their clients. These metals, this purchase of this firm, which, as I have said, might be a German-controlled firm, need never really come into the possession of this firm at all. For this purchase might be transferred to that client, who may require this particular metal. As I read 1025 the Amendment, it would really mean that a German-controlled firm, company or individual can carry on business just exactly as before the War, and no licence would be required. I am quite sure that that really is not what the hon. Member intends. That, however, is what we understand as the effect of this Amendment.
It will be remembered by the hon. Member that, during the Committee stage, when this question arose as to what was really meant by the words "carried on wholly outside the United Kingdom," we promised to do our best to find words to meet the particular objections raised at that time to these words. We have given most careful consideration to the matter, and we have not been able to find any words which would really be any improvement upon those in the Bill. I think I made it quite clear in the discussion that in the particular instance which, I think, was mentioned by one hon. Member, where some company or firm had their headquarters in this country, and had branch houses abroad, where those transactions in metal were carried on by one of these branch houses, where those transactions were not direct, or where the contract was not made by the principal office in this country, transactions carried on wholly by the branch house, where, as the result of such a transaction no metal was brought to or taken from this country, no licence was required. That is our view of the situation. That is how we interpret this Clause. I would remind the hon. Member that the Board of Trade is the Government Department responsible for the administration of this Act, and after the explanation. I have given as to the manner in which we interpret this Clause, I trust he will not press this particular Amendment, or for any alteration of the words in the Clause.
§ Sir A. WILLIAMSON
The discussion as to the effect of these words was one to which, to some extent, I contributed. The interpretation of the words, "carrying on business" is a difficulty which originates very largely in respect of the interpretation of Income Tax law, and is one which has made it very difficult to provide words to carry out what the Government say is their desire, and certainly was my desire, in moving this proviso in Committee. What the President of the Board of Trade has just said 1026 covers the case I had in mind—that is the case where the branches of a British house had a local or entirely foreign trade in metals, which is not directed from here and which the Home Office may even be ignorant about. If the President says that the Board of Trade are themselves to be the authority which decides on the case of prosecution, or rather whether the case is such that it requires a licence or not; if, I say, the Board of Trade is the authority, and if it is on record in the annals of the House that the President of the Board of Trade, speaking to the subject, has declared that such cases that I have in mind are thoroughly provided for in the proviso, probably we may be satisfied. I myself thought of other words that might be possible, but I have not been able to find words that I think would be better. For my own part, therefore, I shall be content to accept the proviso as it stands. It agrees with the explanation given by the President as to the intention of the Board of Trade, and, I think, really it meets the case.
§ Mr. J. HENDERSON
The President of the Board of Trade speaks of a German firm establishing an agency here, and requiring a licence. Quite true. But what is to prevent a German firm, say the Metallgesellschaft, having an agency in Bolivia, buying up ore there, and sending it direct to Germany? Nothing! How does this proviso help you to bring these metals to this country? I do not know. It is an inexplicable thing. Every Amendment we make seems to drive further away from the object of the Bill. I do not understand it.
Further Amendment made: In Subsection (2), after the word "the" ["the Schedule"], insert the word "First"—[Sir A. Stanley.]
§ Mr. HEMMERDE
I beg to move, in Sub-section (2), to leave out the word "unless" ["granted unless the Board of Trade"]. and insert instead thereof the word "if."
In a very few words I think I can show that the word I suggest is very much more desirable than the one that is in the Clause. We had the same question discussed in Committee. After the discussion the Government accepted the addition of several words, "for any special reason," which, of course, made a very considerable difference. But I ask the 1027 President whether he will lose anything at all by acquiescing in this suggested form of words which, he will remember, was desired by a very considerable section of the House, and I think has obvious advantages. In this particular case I would ask the Government to remember that they are imposing certain disabilities. They are saying to people who formerly had rights of trading in certain trades that they are not to trade in that way in the future. Therefore, I would suggest, the proper thing is that the burden of proof, such as it is, should remain upon the Board of Trade, and that no licence should be granted if the Board of Trade think the grant of a licence is inexpedient. Surely it is a very much better way to do it than to say that no licence shall be granted unless the Board of Trade say that the granting of a licence is expedient. Where, in a case like this, you are imposing some disability you ought not to put the burden of proof upon the individual. Is it not far better to put it upon the Board of Trade? Something was said in Committee on the last occasion about this Amendment, taking away the whole effect of the Bill. I think it will have very little effect in that way. As the Bill is drafted there is no appeal from what the Board of Trade may think inexpedient or expedient. It is not one of those questions where you can force an appeal to the Courts upon the question of a thing being done reasonably or otherwise. It does seem to me it would be far better in a case like this that the Board of Trade should have in mind the fact that it is putting upon a trade or a trader certain disabilities which were not there before, and say where burden of proof should be, if only for the purpose of instructing the mind of the Board of Trade officials to see that a case has been made out. I do not want to move this Amendment under any misapprehension at all. I subsequently do wish to see inserted, and I have an Amendment to that effect, some appeal from the discretion of the Board of Trade. Whether, however, we put that in or not, it still seems to me to be undesirable that we should have the Bill in this particular form. This particular wording in no way depends upon whether the Board of Trade do or do not accept subsequently the appeal I suggest.
§ Mr. STRAUSS
I beg to second the Amendment.
By the acceptance of this Amendment the interpretation extends to paragraphs 2, 3, 4, 5, and 6 of the Schedule. The only question is in regard to paragraph 1. Here the word "expedient" would rather help them than otherwise, for the Board of Trade must not forget that these conditions can be easily evaded. A person who has been in business and has been naturalised can transfer his business to his son or nephew, or anybody he pleases, and can still derive benefit by the interest he has in the profits of the business, although he may have given it up. The benefit is not going to the enemy; therefore such an evasion would be very easily carried out.
§ Sir G. HEWART
This proposal appears now by no means for the first time. More than once it was indicated in the Debate on the Second Reading, and it has appeared, substantially, in various forms in Amendments during the Committee stage. May I just point out how and why the change proposed is quite unacceptable, and, I submit to the House, quite objectionable? The scheme of the Bill is that the Board of Trade are to have control of the particular industry which comes within the scope of the Bill. They are to have that control in order that they may exclude from these industries persons who satisfy certain tests or criteria of disqualification. If persons are going to be disqualified from carrying on their business, it is right that they should know what is the ground of disqualification, and, therefore, the Bill sets out in clear language the grounds upon which a person may be disqualified. To summarise them roughly, they are enemy character, enemy influence, enemy association, and enemy control. Having laid down those tests, the Bill provides that all persons who are or who seek to be engaged in this industry are to be divided into two classes—those who come within the disqualifying criteria of the Schedule and those who do not. But we have introduced into the Bill a further provision, that persons who would automatically be disqualified may have their particular circumstances laid before the Board of Trade, and, although the mark of disqualification is there, the licence may, nevertheless, be conceded. That, I submit, is a reasonable and proper qualification in the interests of the 1029 applicant for the licence. What would be the effect of the Amendment proposed by my hon. Friend? It would substitute for the criteria set out in the Bill a vague, undefined, criterion resident in the mind of the Board of Trade. The really operative element in the decision of the Board of Trade, if this Amendment were adopted, would not be something which is contained in the Schedule of the Bill, but it would be some super-added reason which is not in the Schedule. I submit that that is fundamentally wrong. The reason why these tests are in the Schedule is that they represent the policy agreed upon by this House.
§ Mr. HEMMERDE
Is not the right hon. and learned Gentleman arguing as though the words were that the licence shall be granted? Here I keep the words "no licence shall be granted if the Board of Trade are of opinion that the grant of the licence is inexpedient." I suggest what must govern the Board of Trade are the conditions in the Schedule and no other.
§ Sir G. HEWART
If that is really the meaning of my hon. and learned Friend, then I submit that the Bill, as it stands, manifestly meets its purpose, because what happens is, if the applicant comes within the disqualifying tests of the Schedule, he is not going to have a licence unless for particular reasons the Board of Trade have any special reason for granting it.
§ Mr. HEMMERDE
The right hon. and learned Gentleman is actually going back to the old argument. He says "if the Board of Trade have any special reason," and those words were in Committee considered to be objectionable. I assume the Board of Trade would grant a licence unless they regarded it as inexpedient. Is that what the right hon. and learned Gentleman means?
§ Sir G. HEWART
That was not in my mind. The submission I am making is that under the Clause, as it stands, it is clear that, if the applicant comes within the Schedule, he is disqualified unless the Board of Trade think in that particular case a licence should be granted. If the proposal of my hon. and learned Friend were adopted the effect would be to turn it the other way about. It would not matter that the applicant came within the Schedule. He could not be disqualified unless for some additional reason not 1030 stated, or described, or set out, or communicated to him, the Board of Trade thought it was inexpedient to grant him the licence. I think it is right that the burden of proof should be left as it is, and the real disqualification should be that stated in the Bill, and not something else which is concealed from the applicant. It is quite a different thing, if the applicant does come within the disqualification stated in the Bill, that the Board of Trade should, nevertheless, in that particular case, concede the licence. My hon. and learned Friend said that if the Amendment were carried it would have very little effect. If that is, indeed, the case, it constitutes a very good reason for not pressing the Amendment.
§ Mr. BRUNNER
I think the Board of Trade will find, when they come to examine into the case of companies that are carrying on the non-ferrous metal industry, nearly all of them come within the Schedule. Is he, therefore, only going to make a few exceptions in the case of companies? I think the course the Board of Trade ought to adopt is to grant the licence except in a few cases, but, on the contrary, they propose to grant no licence except where there are special circumstances which make it expedient to do so. It ought to be a general rule for the licence to be granted unless there is some serious fault to find with the company. It should, in fact, be granted as a matter of course. May I refer to one company in which I am interested, a company engaged in the manufacture of non-ferrous metals? One half of 1 per cent. of its capital is held by alien enemies, and therefore its licence is entirely under the control of the Board of Trade, which can, if it thinks fit, withhold it. Now nearly the whole of that one-half of 1 per cent. is held at the present time by two ladies who, until their marriage, were British subjects, and who, by reason of their marriage, became Austrian subjects. But the fact remains there is alien enemy capital in the company because these ladies are alien enemies. In this particular case I think the licence should be granted because there is absolutely nothing the company has done in the past or is likely to do in the future which would render its dealing in non-ferrous metals a danger to this country.
§ Mr. D. MASON
I quite agree with the Solicitor-General that there is little new 1031 in this Debate. But there is a great deal in another sense. There is the question of creating an atmosphere—of creating the idea that the Board of Trade should grant these licences freely and not adopt the attitude of only granting them as a great favour. I take it the object of my hon. and learned Friend in moving this Amendment was that we should assume that the bulk of the traders here are not tainted with this enemy connection. I gather that the difference between the right hon. and learned Gentleman and the supporters of the Amendment is but small—
§ Sir G. HEWART
May I interrupt the hon. Gentleman? The difference between us is this: The intentions of the Bill are set forth in the Schedule, but my hon. and learned Friend proposes to put the test elsewhere.
§ Sir G. HEWART
The assumption of the Bill is that the trader will not be within the Schedule, but, if he is, then he will be disqualified. That I take it is what my hon. and learned Friend objects to.
§ Mr. HEMMERDE
With the greatest possible respect, I would suggest that my right hon. Friend totally misconceives the object of this Amendment. What we want is that it should be a simple matter for the Board of Trade to say, as a matter of course, that the licence should be granted to a company in such a case as that mentioned by my hon. Friend, where but one half of 1 per cent. of the capital is held by two Austrian ladies.
§ Mr. MASON
I hope the Solicitor-General will in the interests of his own Bill try and make it popular, and not unduly create friction. If he desires to avoid creating friction, and is wishful to create a favourable atmosphere, then let him accept the Amendment and thus show that the Board of Trade are anxious to facilitate the trade and only withdraw licences where it is inexpedient they should be granted. Let him assume that people are innocent until they are proved to be guilty.
§ Mr. HEMMERDE
As I do not want to exclude other Amendments from discussion, I ask leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
§ Sir F. BANBURY
I beg to move, in Sub-section (2), to leave out the words "unless the Board of Trade are of opinion that the grant of a licence is expedient."
The effect of my Amendment is to ensure that where persons do come under the Schedule no licence is to be granted. I attach very great importance to this Amendment because the form in which the Bill is now drafted gives to the Board of Trade power to say to one man, "You may earn your living," and to another many "You may not," although both of these people are in exactly the same position under the First Schedule of the Bill. No such power has ever before been given to any Government Department. Take the case of the liquor licences. Who grants them? Not a Department of the Government, but the magistrates, and, in certain cases, the London County Council. They are granted by the Courts of Law. In the first instance they are granted by the licensing committee of the justices, with an appeal from their decision to a higher Court. But the whole of these matters are in the hands of the legal authorities in this country. Now we come down and say in. this Bill that a Government Department. shall have the power of declaring that one particular person shall not carry on a business by means of which he earns his livelihood, while another person may do so. See what a temptation that puts before a Government Department. Think how easily such a provision may lead to, corruption.
In the first place, this Bill lasts for five years after the War. We do not in the least know who is going to occupy the position of the right hon. Gentleman opposite, not in three or four years' time but in three or four months' time. We do not in the least know, under the provisions of the New Reform Bill, what sort of House will be returned here at the next General Election, and we do not in the least know who are going to form the Government of this country. In all those circumstances, is it wise to give to a single Department this enormous power? One of the great failings of democracies has always been that they have often—in fact, nearly always—led more or less to corruption. The power of Government of facials to interfere in the life and in the business and trade of the country naturally gives opportunities to favouritism. I think myself it is quite possible that if this does become law, at any rate, bribes will be offered to 1033 the Department to admit certain people. I do not think there is the slightest doubt about that. I am not at all sure that under certain circumstances that would 'not be so among—I do not say the heads—the minor officials of the Department. We have had something of this sort in the Clothing Department, and I am not talking at random. We have had minor officials—I think, in the Clothing Department at Chelsea—convicted of taking bribes in order to pass certain goods. What is to prevent a similar course occurring among the minor officials of the Board of Trade in order to put favourably before their superiors the case of a person who has applied for a licence? Surely, if we are going to say that it is in the interests of the country that certain people who are alien enemies, or that certain companies who have alien enemy money in their capital, are not to do certain things it is Parliament who ought to say whether those people are at liberty to do it or whether they are not.
If the object of the Bill is, as has been stated, to stop this, why do we want to give power to the Board of Trade to permit it? If it is right that these people should not deal, if it is in the interests of the country that they should not do so, if it is going to save life in the future, as we have been told is the case by the late Minister of Munitions, if all these things are agreed, surely there can be no doubt that none of these people ought to have this power of dealing. If, on the ether hand, the Bill is brought forward with an object which has been concealed and which has not been frankly stated to the House, then I can understand that it may mean that certain people will be granted licences and that other people will have those licences withheld. I say that is a procedure to 'which this House ought not to lend itself, and that if the Bill is honestly designed to prevent alien enemies having dealings in these metals, this House should say there is to be no exception, or if there is to be an exception there must be a new Bill brought in modifying the old Bill. One of the chief reasons why I objected to this Bill and why I fought against it on the Second Reading was this very provision. If this Bill is passed and this provision is put in, is it going to stop there? Will not other Departments come forward and ask for the same power, the same privileges, and the same control over the trade of the country 1034 which we are going to give by this Bill to the President of the Board of Trade? If that is so, shall not we be met by the argument that we have already created a precedent, that we have done it under this Bill, and that, therefore, there is nothing unusual in doing it under another? It is because I feel that the future of this country, so far as regards trade, is really at stake at the present moment, and that if we now—as we shall do if we pass this Bill with this provision in it—permit for the future a Government Department to have the right to say, "You may do your business, and you may not," we shall be entering upon a course which is bound to lead to failure and corruption, that I move this Amendment.
§ Sir A. STANLEY
The object of this Amendment, as I understand it, is to remove entirely any discretion the Board of Trade might exercise with respect to the issue of these licences. I will say at once that we cannot accept this Amendment. The effect of it would be that all of the companies, firms, and individuals who came within the First Schedule of the Hill would not be entitled to, and would not receive, a licence. Some company, firm, or individual which had prior to this been engaged in the metal trade of this country, but which by a mere accident found itself within the Schedule, would not be entitled to a licence to continue to trade in these metals. Surely that is not a fair way of dealing with the trade. I would remind the right hon. Baronet that it would not be possible for any company, firm, or individual, which, as I have said, found itself by accident coming within the provisions of the Schedule, to bring itself by its own act outside the Schedule. That could not be done, and there it must remain a permanent disability. Throughout the whole time this Act is in force they could not continue to trade in these metals. Take the instance given by the hon. Member opposite of a company, with which he sass he is associated, and which by some accident of some few shareholders, by virtue of their marriage I believe, being enemy subjects, is brought within the Schedule. Is it going to be argued that simply because of that disability alone you are going to bar that company from even being considered as really entitled to a licence? Surely it cannot be suggested that this 1035 House would approve an Amendment of that kind. It must be borne in mind that we are living under new conditions. We are living in a new world, and are faced with entirely new circumstances. Things that were possible before the War are impossible in the interests of our trade to-day. I at once accept the statement of the Mover of the. Amendment that the trade of this country is really at stake. I accept that at once, and it is because we do accept that situation that we have brought in this particular Bill to try to put at least this industry on a secure foundation. I wish to make it quite clear that there are undoubtedly instances where a company, firm, or individual would come within the Schedule, but the mere fact that they do come within the Schedule should not in itself mean that they should not be entitled to a licence, and it is desirable to give to the Board of Trade the power of discretion. I cannot agree with the right hon. Baronet that even the subordinate officials of the Board of Trade would be subject to the bribes which he suggested. I would remind him that in a matter of this kind in such a Department as the Board of Trade—and I am sure this would be true of any other Government Department—the administration of such an important measure as this would not be left to subordinate officials to determine, and he may be assured that the administration of the power conferred on the Board of Trade by this Act will be exercised fairly, honestly, and with due discretion.
§ Mr. BRUNNER
I am very glad that the President of the Board of Trade does not see his way to accept this Amendment. If he did he would certainly have to modify a great many of the stipulations of the Schedule, but I want to disabuse his mind of the opinion that there is any very large class in this country which wants to see the Board of Trade controlling commerce after the War. The sooner we get rid of Government control the better for everybody concerned. We absolutely deny that the non-ferrous metal industry is in any need of assistance of the Board of Trade. There was never any time when this country had to pay more for its metal than any other country in the world, when freights were considered, and therefore, if the President of the Board of Trade drops this Bill, he may be quite certain that the trade of Great Britain will not come to any harm whatever.
§ Mr. J. HENDERSON
I should be, very much inclined to support the right hon. Baronet (Sir F. Banbury), because, as a matter of fact, I, with him, strongly object to any Department having such a. power as that of giving licences according to their discretion, but if he will look at Sub-section (5) he will find that any question arising between the Board of Trade and any company, firm, or individual as to whether any of the conditions set forth in the Schedule apply, it can be referred to the High Court, and there you get a judicial decision as to whether the Board of Trade are entitled to act or not. Of course, there may be a great many cases on the border-line where people and companies who were at one time enemy, and even up to the date of November, but I take it that if those companies and firms purge themselves of all enemy association the Board of Trade will either grant a licence or an appeal to the High Court, who will obtain that licence for them. I think, therefore, the words could be left as they are, and that the right hon. Baronet might be satisfied with Subsection (5).
Further Amendments made: In Subsection (3), after the word "unless" ["unless suspended or revoked"], insert the words "shall remain in force unless and until it is."
Leave out the words "shall remain in. force."—[Mr. Wardle.]
§ Sir C. HOBHOUSE
On a point of Order. May I move the Amendment standing in the name of the hon. Member for Gloucester (Mr. G. Terrell), at the end of Sub-section (3), to add the words "for the period of this Act"?
§ Sir C. HOBHOUSE
If that is so, I do not wish to move. It was only in order to get an explanation that I proposed to do so.
Further Amendments made: In Subsection (4), after the word "the" ["set forth in the Schedule"], insert the word "First."
After the word "Act" ["Schedule to this Act"], insert the words "or in the case of a company, firm, or individual, to which a licence has been granted not withstanding that it was subject to any 1037 such condition as aforesaid, that it is expedient that the licence should be revoked or suspended."—[Sir G. Hewart.]
§ Sir G. HEWART
I beg to move, in Subsection (5), to leave out the words "as to whether or not any of the conditions set forth in the Schedule to this Act apply in respect of the company, firm, or individual, or as to whether or not the company is controlled by a company, firm, or individual in respect of which any such conditions apply, the," and to insert instead thereof—
- "(a) as to whether or not the business carried on by the company, firm, or individual, is such as to require a licence under this Act; or
- (b) as to whether or not any of the conditions set forth in the First Schedule of this Act apply in respect of the company, firm, or individual; or
- (c) as to whether or not the company, firm, or individual is controlled by a company, firm, or individual in respect of which any such conditions apply; or
- (d) as to the requirements of the Board of Trade for the production of books or documents for inspection."
My Amendment consists of four paragraphs. The effect of the new elements introduced in this Amendment is to give a reference to the High Court as to whether or not the business carried on by the company, firm or individual is such as to require a licence, and, secondly, as to the requirement of the Board of Trade for the inspection of books or documents. These proposals are brought forward in response to pledges which have been given to the Committee. One question raised was in regard to wholesale trading and other trading, and another point was with regard to the documents, it being argued that it might be vexatious to call upon traders to produce their books. The words in the Bill are "such inspection as may be reasonably required" and this Amendment gives an appeal as to whether that requirement is reasonable or not.
Amendment agreed to.
Further Amendments made: At the end of Sub-section (6) insert the words "and where the application is made with reference to the suspension or revocation of a licence the licence shall not be suspended or revoked until the question has been determined by the Court."
1038 In Sub-section (7), leave out the words "but in the latter case such publication shall not take place, pending the final decision of the Court."
At the end of Sub-section (8), add the words "and the reference to a Divisional Court of the King's Bench shall be construed as a reference to a division of the Court of Session."—[Sir G. Hewart.]