Cars

HC Deb 20 June 1990 vol 174 cc916-8

7. Mr. Mans

To ask the Secretary of State for Trade and Industry when he last met his European counterparts to discuss the treatment of cars manufactured in the United Kingdom by Japanese-owned companies.

Mr. Ridley

I discussed the subject yesterday at the Foreign Affairs Council. I have insisted that cars manufactured in the European Commission by Japanese-owned companies should continue to enjoy unlimited free circulation throughout the Community, and I believe that that has now been accepted.

Mr. Mans

Will my right hon. Friend continue to welcome investment by Japanese companies in Britain? Will he assure me that the European Commission will treat motor cars manufactured by those companies in this country in exactly the same way as they treat motor cars manufactured by Ford and General Motors in Germany?

Mr. Ridley

Yes, Sir. I have insisted on that point, despite contrary views within the Community. In the meeting yesterday I discerned that it has now been firmly established that we are acting within the treaty of Rome in demanding that that be the case. I am also happy to say that satisfactory progress has been made on the whole issue.

Sir Hal Miller

In his discussions, has my right hon. Friend been able to discover the basis of the objection to British workers in British factories making vehicles from European components financed by British money? What possible basis can there be for objecting to the free circulation of those vehicles throughout the Common Market? Has my right hon. Friend taken note of joint ventures by Japanese companies with companies in the countries of our continental partners and of the joint ventures that they have established in third-world countries such as Brazil, Mexico and the far east—to say nothing of eastern Europe?

Mr. Ridley

In my opinion, there can be no question but that cars manufactured in this country are part of Community production. I see no reason why any member state should think otherwise. On my hon. Friend's second point, there are more than 90 major Japanese investments in France, for example—and no one has suggested that the products of those factories should be treated as other than Community production. Nor do I believe for one moment than anyone could or should.

Mr. Cryer

Has the Secretary of State studied yesterday's decision by the Luxembourg court and its potential effect on Government decisions—for example, in car manufacturing? Does that decision mean that a manufacturer anywhere in the world who is dissatisfied with the position and actions taken by the British Government—for example, in giving regional selective assistance to a car component manufacturer in Scotland, Yorkshire or elsewhere—could apply to a British court and have the Government's decision, and legislation passed by this Parliament, suspended? If it could do that, it would set the Government and Parliament at naught. Should not the Government and Parliament resist such action?

Mr. Ridley

I cannot claim to be a lawyer, who could pronounce on such matters. I have read the articles that appeared in this morning's press, and feel that the hon. Gentleman would be wiser to seek an interpretation from someone more skilled in the law. It was always implicit on our joining the Community that we should have control over our affairs from the centre as to where we yielded in that respect. That is the importance of the doctrine of subsidiarity in making clear where the boundary is.

Mr. Grylls

Is my right hon. Friend aware of the importance of the news that he has given the House this afternoon, that motor cars made in Great Britain by Japanese-owned firms will be freely allowed on to the continent? Will he make sure that that actually happens? Until those motor cars are seen to flow out of the factories in Britain and on to the continent, there will still be doubt about whether the free market of 1992 will really arrive.

Mr. Ridley

I can only give my hon. Friend the assurance that I am confident that that result will prevail. Cars are already flowing out of at least one factory, in north-east England, and on to the continent without let or hindrance.

As I said, that issue was raised a second time in discussions, and I am confident that it has been suitably resolved. I cannot claim that the way in which the Community is moving will result in a totally free market for cars after 1992, but it will for British-made cars.