HC Deb 28 June 1965 vol 715 cc194-207
Mr. van Straubenzee

I beg to move Amendment No. 32, in page 8, line 35, at end to insert: Provided that this subsection shall not have effect until the Board have made an order setting out a list of the treaties concerned.

Mr. Speaker

I suggest that, at the same time, we also consider Amendments Nos. 34 and 35 in the name of the hon. Member for Wycombe (Mr. John Hall) and the names of his hon. Friends—in page 9, line 2, at end insert: and which is included in Schedule (Treaties) to this Act. In page 9, line 2, at end insert: (5) The Board shall have power by order to add or vary the list of treaties set out in Schedule (Treaties) to this Act. —and the new Schedule—"Treaties", also standing in the name of the hon. Member for Wycombe.

11.45 p.m.

Mr. van Straubenzee

That would be convenient, Mr. Speaker.

I am obliged to the President of the Board of Trade for assuring me that I still look as if I am in possession of my faculties. I will do my best to justify his confidence.

We now arrive at Clause 4, which gives certain powers to the Board to exercise the very considerable powers in Clause 3 if there has been or is likely to be a breach of a treaty. When we discussed this in Committee a number of my hon. Friends were concerned to know how anyone would have the opportunity of appreciating what treaty it was they were likely to breach. It was because we did not then feel we had been given an adequate reply to the arguments put forward that this composite series of Amendments has been put on the Order Paper for our consideration. What they do, in brief, is to provide that there is added to the Bill a Schedule specifying, initially, two treaties which are the ones at point at the moment, and ensure that the necessary flexibility is given for those to be added to and for the powers contained in Clause 4 only to come into force when the Board has made an order setting out the list of treaties concerned. That summarises the effect of Clause 4 as it would be if this series of Amendments was accepted.

There was a great deal of probing upstairs to try to find out what was in the President's mind. The point was most succinctly put by the hon. Gentleman the Minister of State of 11th May, 1965, when he said: On the points raised by the hon. Member for Wycombe (Mr. John Hall), the appropriate part of Clause 4(1) is about half-way through, where it says that when the Commission makes a report the Board of Trade may take action where something 'has been or is likely to be a breach or a conflict of the Treaty'. He went on: Now the only two treaties with which we are really concerned in this regard are the E.F.T.A. Convention and G.A.T.T. Therefore, where action is required so that we honour our E.F.T.A. obligations, I think it is, although perhaps not as clearly stated as the hon. Member for Wycombe would like, implicit in this Clause that we are referring to a treaty of this kind. We do not want to spell it out too clearly, for the reason given by the hon. Member for Reading (Mr. Peter Emery) that there may be other treaties in the future. That is what he said when hon. Member's on this side of the Committee were probing as to what was in his mind. This point was followed closely by my hon. Friend the Member for Worthing (Mr. Higgins), with his usual pertinacity. It might be a fair summary to say that he said he was not satisfied that these were the only two treaties and although he may explain it himself later I got the impression that he, and other hon. Members, were questioning in their minds whether there might be treaties additional to those but which were not known to the House.

I am able, after carefully reading the reports of our meetings in Committee, to set at rest the anxieties of any hon. Member who thinks there is some kind of secret treaty in this matter, for the Minister of State was quite explicit. In col. 363 this is what he said: These are not secret treaties. All the trade agreements that Great Britain has entered into are available for public inspection. The Minister was quite emphatic, definite and clear. To summarise, he made it plain that there were only two treaties that he had in mind and that those treaties were E.F.T.A. and G.A.T.T.

It is for that reason that we seek to place in the Bill precisely those two treaties by way of scheduling them. I am hopeful that the necessary time for reflection having passed, the Minister of State will now see how helpful it would be to all concerned if there was absolute certainty on this point.

"Absolute certainty" picks up the discussion which took place on the last Amendment. I do not need to dwell on it at length, particularly at this hour, but the Minister of State will recall that on both sides it was agreed that it was a duty of this House, wherever possible, to make the state of the law clear to those who might be affected by it. I do not believe that the matter could be more clearly put than it was put in Committee by my hon. Friend the Member for Worthing at col. 359. With my hon. Friend's consent, I should like to repeat what he said: I think that the fundamental point which we ought to make is that if business men are to be subject to the provisions of the Bill when it becomes an Act because the actions which they are taking are in conflict with some treaty, they are entitled to know where they stand. It would be unfair if, because of treaties which had been signed in the past, or which may be signed in the future, a business man, who perhaps unwittingly was in conflict with one of those treaties, suddenly found that the Board of Trade was able to take action against him on the basis of this Clause."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 351, 363, 359.] I thought then, and I certainly think now, that that placed the argument in a nutshell.

In Clause 4, we are taking extended powers relating to possible breaches of treaty. There is nothing in the Bill to say what those treaties are. It is surely inherent in our method of dealing with those who are affected by our legislation that we should make it as clear as we can what the law is and what it is that business men, who might possibly breach a treaty, have to avoid and what are the rocks that they must watch out for in the channels ahead.

I have sought to show that, on the Minister's own words, he has only two treaties in mind. Those are the two treaties listed in the new Schedule. I have sought to show that fears and anxieties that there might be other treaties are, on the Minister's own words, not justified. I genuinely believe that the argument stands without any further difficulty or elaboration and I am confident that after mature thought in the period that has since elapsed, the Minister will feel able to accept our Amendments.

Mr. Higgins

I support my hon. Friend the Member for Wokingham (Mr. van Straubenzee), who has so adequately and cogently proposed the Amendment. There are, however, one or two other points which should be brought to the attention of the House, more particularly because this matter was not covered in any detail on Second Reading. Indeed, I am rather uncertain whether it was even mentioned.

When we were in Committee upstairs, it became apparent that the Government's proposals in Clause 4 were extremely important—I described them at the time as something of a Trojan horse—because they introduced into our monopolies legislation what appeared to be the beginnings of international monopolies legislation in that they endeavoured to incorporate into the domestic law of the country arrangements whereby treaties which we had signed with other countries could be given effect. To this extent it was an extremely important Clause.

Most of my hon. Friends would agree with me when I say that it would be desirable, if it were found that these monopolies were in conflict with one of our treaty obligations, that they should be subject to the sanctions set out in this Bill. Therefore, there is no basic disagreement between the two sides of the House, I believe, on this point. Where we do find very considerable disagreement is on the question of which treaties in particular we are concerned with in this Clause. It is for this reason that my hon. Friends have tabled the Amendments we are discussing.

Before I turn to the detail of them there is one point I should be glad if the Minister of State would clarify. He mentioned in Committee that the Clause was to implement the obligations we had in particular with E.F.T.A. We asked at the time if there were reciprocal arrangements, similar to those in the Bill, in the other E.F.T.A. countries. He was unable to answer at the time. I hope that, in the light of the discussion which we had, he will be able to give us some more positive answer than he gave us on that occasion.

I turn to the Amendments. The first point which needs to be made clear is that, in spite of what my hon. Friend the Member for Wokingham has said, one feels, if one reads through the speeches of the Minister of State, that there is considerable doubt whether he was merely referring to the E.F.T.A. treaty and the General Agreement on Tariffs and Trade or whether he had some wider scope in mind. I agree with my hon. Friend that there is no question of any secret treaties being involved, but that the question is which treaties in particular are to be covered by the Clause. It is for that reason we have suggested we should specify in detail which treaties are covered. The best the Minister of State could do by way of reply, when we queried this first of all, was to say: We were advised that those were the words which ought to be used in this connection to cover all the trade treaties which this country has entered into. … This seems to me to be wider than a reference merely to E.F.T.A. and G.A.T.T. Therefore, I think it is important that we should pursue this matter this evening in the whole House.

The second point which must be made, and should be made very strongly, is that in the debates in Committee it was suggested that somehow if we were to specify the treaties precisely this might encourage certain countries overseas to protest about what British firms were doing, and the implication of this seemed to be—and it was not contradicted—that there might be British firms in conflict with our treaty obligations and the Minister was desirous of omitting from the Bill a list of treaties in order to protect them from such complaints. This seems to me a totally wrong attitude for any Minister in this country to adopt when considering the treaties into which we have entered and an honourable obligation.

The second point which he made appeared to be that there was no need to specify precisely what the treaties were because business men need not know with which treaties they might be in conflict. This, again, as my hon. Friend said, seems to us to be totally wrong, because it means that business men may find themselves suddenly subject to sanctions of the Bill without knowing in advance that they would be subject to them.

12 m.

One of the extraordinary things which emerged in the debates in Committee was, that the hon. Gentleman suggested that the action of the Government might be directed against firms which were going to be caught by the Clause as it now stands. The hon. Gentleman said: It may be that after the Bill has become law this will be one of the first references to the Monopolies Commission, and it would be improper, for a number of reasons, to mention the case this morning. Are we to understand from that that we are going to omit from the Bill any specific reference to certain treaties other than those which we specify, and we are then going to find that when the Bill becomes an Act the Government are proposing to take action against a company which the Minister of State or his colleagues have in mind, and in this way they will catch the company? That is a wrong attitude for the Government to adopt in this matter, and I hope that by accepting one or other of the Amendments the hon. Gentleman will remove any doubt from the minds of hon. Members on both sides of the House about the Government adopting an irresponsible attitude of this kind.

There seems no reason why we should not specify in the Bill the actual treaties which are concerned. The hon. Gentleman tended to excuse this with the words: I am also advised that it was technically difficult, and perhaps not altogether in the public interest, for the whole list of trade treaties and agreements which we have entered into to be published as a Schedule to the Bill … Later on he said: I know that that is an unsatisfactory answer, but it is the answer that we have to give to the hon. Gentleman, and I hope that it will be accepted by the Committee."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 360–1.] Whether or not it was accepted by the Committee, I very much hope that the same unsatisfactory answer will not be accepted by hon. Members tonight, because to say, "I am sorry it is an unsatisfactory answer, but I hope that it will be accepted" is not really the kind of intellectual approach that we expect from the hon. Gentleman, and I hope, therefore, that he will have no hesitation in accepting the Amendments.

The hon. Gentleman will observe that the Amendments are in two forms. The first is that the Clause shall not have effect until such time as the Board of Trade has specified what treaties it has in mind, and the alternative is that we should accept the Schedule which we have added. When we discussed the matter in Committee, it was not possible for the Amendment covering the Schedule to be called, for the rather good reason that we had omitted to put down the Schedule. We have now managed to cover that particular point, and so the Schedule now reads that the two treaties concerned are those which the hon. Gentleman, during most of his speeches upstairs, seemed to say were in his mind, namely, the E.F.T.A. Treaty, and the G.A.T.T.

If the hon. Gentleman accepts the Amendments, it will still be possible to add to the Schedule any further treaties which he feels he would like to cover. We think that this is a matter which ought to be clarified. We agree with the general principles of the Clause, but we think that it is vitally important that business men should know where they stand in operating within this legislation, and I therefore have great pleasure in supporting the Amendments.

Mr. Peter Emery

I do not have much to say on this Amendment which has been moved so admirably by my hon. Friend the Member for Wokingham (Mr. van Straubenzee) and supported with his usual clarity by my hon. Friend the Member for Worthing (Mr. Higgins), but it is important that we should press this matter because the Government did not give an exact undertaking in Committee upstairs. The Minister of State intervened on more than one occasion during our discussions on this topic, and I tried to put forward some alternatives in an effort to help the hon. Gentleman.

It is a nonsense of the most extreme sort that a business may find itself suddenly, when this Bill becomes an Act, subject to the regulations of treaties entered into and unspecified by the Bill, and then suddenly find that because of the rest of Clause 4, line 32 to 36, that where there has been or is likely to be a breach of or conflict with a treaty, then, for the purposes of remedying or preventing that breach or conflict, the Board may by order exercise all or any of the powers conferred by section 3(2) and (3) of this Act. Looking in Section 3(2) and (3), we see the whole panoply of powers even down to the price regulation in paragraph (3) which it would be open for the Board of Trade to take. If any Government, whatever its political structure, is to be given the power to take this action with industry, then industry must surely, in common decency and ordinary reasonable understanding of a logical or business approach, have the right to know what these treaties are they could be breaking. As I said in Committee, and I think it is worth repeating, this is much more difficult for the smaller firms. Large firms have staffs in the export market. They have legal departments that are completely au fait with what is going on in international trade. It may well be expected that they will know and possibly cope with this present situation.

But it is not true of the medium entrepeneur, the small business in the Midlands, the small engineering firm, particularly in Reading, my own constituency, where they are attempting to assist in the export drive and indeed are probably over-stretched on their capital resources and staff resources at the moment. They certainly would not have legal departments who would be examining or considering this particular aspect of the Bill.

Therefore, I believe that if one looks at the statement by the Minister of State and mentioned by my hon. Friend the Member for Wokingham: These are not secret treaties. All the trade agreements that Great Britain has entered into are available for public inspection. As long as that is true, and we have no reason to doubt that the Minister would say anything but what is the case, then indeed there can be no reason for not accepting our Amendment. We have the Schedule there. It will be within the power of the Government to add whatever treaties they want to the Schedule. There are two treaties down at the moment, and the Government would have powers to add to these treaties if they saw fit. Therefore, I hope that they can accept the Amendment. If they cannot, and I would want strong reasons to be given why they could not, would they then accept and give an assurance on the question that I asked during the Committee stage. Could any company wishing to have a list of all the treaties affecting the operation of the Bill and the regulations obtain this list by application to the Board of Trade? If we could have that understanding, anybody wishing to have such a list could obtain it without any difficulty, although it would not be written into the Bill"—[OFFICIAL REPORT, Standing Committee E, llth May 1965, c. 364.] We were given a partial assurance. If the Government cannot accept the Amendment, they should state categorically that a firm has this right to go to the Board of Trade and automatically to be provided with a list of the treaties. That is not the best way to deal with the matter; it is a bad second or third best. Someone who picks up the Bill for the first time will not have seen this assurance and will not know of the Board of Trade's intentions in this respect. I therefore urge the Minister to accept the Amendment, which would assist industry in the operation of the Bill.

Mr. Darling

The hon. Member for Worthing (Mr. Higgins) said that in Committee I said that I knew that "this was an unsatisfactory answer". After a series of interjections and speeches I tried to say, "I know that this answer will be unsatisfactory to hon. Members opposite"; but I am willing to accept the Report as it appears. I give the hon. Member the assurance that the other E.F.T.A. countries have either introduced similar provisions, or are in the process of doing so, and there would be the reciprocal arrangements about which he asked.

All hon. Members who have spoken have quoted from my speeches in Committee. Added together the quotations have been at some length. One quotation, which is germane, has not been made. I said that we were concerned in the discussion with E.F.T.A. and G.A.T.T., but I continued, … there are a number of other treaties and trade agreements which come within the definition, which we decided on after full consideration, and a treaty means 'any agreement with a country outside the United Kingdom or the government of such a country, or with any international organisation or authority, being an agreement binding on Her Majesty's Government in the United Kingdom.' We were advised that those were the words which ought to be used in this connection to cover all the trade treaties which this country has entered into, and is likely to enter into, where action as proposed in subsection (1) might be called for to deal with the trade practices of firms which offend against international treaties and agreements. We are concerned only with firms which have thus offended. I continued, I am also advised that it was technically difficult, and perhaps not altogether in the public interest, for the whole list of trade treaties and agreements which we have entered into to be published as a Schedule to the Bill in the way suggested by the hon. Gentleman."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 360.] We have gone into the matter very carefully. We shall have to stick to this definition, because the Bill refers to trade treaties; and to give a full list would mean a very long Schedule indeed. I am not altogether convinced that it would be helpful even to larger firms, and I do not think that it would be helpful to smaller firms merely to have a long list of the treaties. But I give the hon. Member for Reading (Mr. Peter Emery) the assurance for which he asked, that any exporter or person engaged in overseas trade who wants a list of the treaties may have it. But I hope that the Board of Trade will go much further than giving the applicant the list. What the Board of Trade has to do is to give advice and information on the content of treaties. The Board of Trade must ask the circumstances of the firm, and inquire why it wants the information and what the Board can do to help. The reason for the inquiry may be that the firm feels that it is on the verge of doing something which would be contrary to the terms of the treaty to which the United Kingdom is a party. So the function of the Board of Trade is to give advice—not a list of treaties.

12.15 a.m.

Therefore, for the reasons given in Committee and with the assurance that I have given that the Board of Trade will give all the help possible to people engaged in overseas trade who want information about agreements—not just titles but the content and other helpful information—I hope the hon. Gentleman will withdraw the Amendment.

Mr. Peter Emery

I do not wish to speak again, but before the hon. Gentleman sits down I want to ask a question. The Minister has said that there is this very long list. We accept that. We are not arguing about that. But I cannot see the difficulty, if this long list exists, between a long list being provided in private and a long list being provided in a Schedule to the Bill. It will save the Board of Trade a lot of trouble if this list is put into the Bill. It seems a complete nonsense to suggest that it is difficult to put a long list into a Schedule to the Bill but that it is easy for the Board of Trade to provide the list. Could the Minister comment on that statement?

Mr. Darling

I had better repeat what was said in our Committee proceedings, reported at column 360 of the Report. I said that I was advised that it was not only technically difficult, but perhaps not altogether in the public interest, to publish the full list.

Mr. van Straubenzee

In spite of his usual courteous approach, I am afraid that the Minister of State has not satisfied those of us on this side of the House who raised the matter. I realise that he repeated the arguments reported in column 360, which naturally we carefully reread before approaching this discussion, but, as my hon. Friend the Member for Reading (Mr. Peter Emery) pointed out, all the trade agreements that Great Britain has entered into are available for public inspection.

There is considerable anxiety on this side of the House about the effect of this upon innocent businessmen and exporters—

Mr. J. T. Price

On a point of order, Mr. Deputy-Speaker. We are not in Committee and the hon. Gentleman has already addressed the House. If we are to have much more of this we shall be here nest week and not merely this morning.

Mr. Deputy-Speaker (Dr. King)

In reply to the hon. Gentleman's point of order, the hon. Gentleman who is addressing the House moved the Amendment, and, although we are on Report, the hon. Gentleman who moves an Amendment is in order in replying to the debate.

Mr. van Straubenzee

I am much obliged, Mr. Deputy-Speaker. I generally find myself politely and correctly slapped down by the Chair, and it is for me a refreshing experience to discover that I am in order.

I was about to say that I appreciate that the Minister of State has made two short advances in our direction. The first is this very helpful point about the reciprocity of the other E.F.T.A. countries, which will be welcomed by my hon. Friend the Member for Worthing (Mr. Higgins) who has gone into this point. Secondly, there is the clear assurance that the Board of Trade will make lists of these treaties available, and the advice that goes with them. I understand that the Minister of State has put that forward to the Committee in a genuine spirit and in a desire to help us in the difficulty that we have expressed.

There is, fortunately, another opportunity and another place for this point to be considered further. Speaking for myself, I think we would like to reflect rather more fully on the implications of some of the things that the Minister has said, because I realise that these matters are not as easy of solution as they might appear.

On that understanding, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Darling

I beg to move Amendment No. 33, in page 8, line 40, leave out from "be" to end of line 42 and to insert: laid before Parliament after being made, and, if the order is not approved by resolution of each House of Parliament within the twenty-eight days beginning with that on which it is made, the order shall cease to have effect (but without prejudice to anything previously done thereunder). In reckoning any such period of twenty-eight days, no account shall be taken of any time during which Parliament is dissolved or prorogued, or during which both Houses are adjourned for more than four days". This Amendment changes the procedure under Clause 4 dealing with Orders to honour treaty obligations. Orders that may be made for this purpose are those provided for in Clause 3(2) and Clause 3(3), but not the power to prohibit acquisition provided for in Clause 3(4) and any related powers provided in Clause 3(5) and Clause 3(6).

The Bill as introduced provided for such Orders to be subject to a merely negative Resolution procedure. The Amendment, which I am sure will be accepted by hon. Members on the Opposition side with gratitude, substitutes for this that the Orders should require affirmative Resolution of each House of Parliament within 28 days of making the Order. The 28 days procedure is quite common with Orders of this kind. It means that they come into effect because of the need for speed. But unless they have Parliamentary approval within 28 days they lapse.

This of course is that procedure which that Bill already lays down for similar Orders. Under Clause 4, when Orders are made on that basis of that Monopolies Commission report that a monopoly or merger may operate, or operate in part, against that public interest, we think that adequate publicity must be given to the situation in which an Order under Clause 4 may have been passed.

The affirmative Resolution procedure means that there can, in all cases, be a Parliamentary debate when the Order is made. In preparation for that debate publicity will be given, and I hope that this change, which was more or less what was suggested in Committee, will have the approval of the House.

Mr. John Hall

Although I personally had a little difficulty in following the Minister at the beginning of his speech because he was reading his brief at great speed, nevertheless I have got the gist of what is intended. I can assure him that we do welcome the Amendment. It is an improvement and we shall certainly support it.

Amendment agreed to.