HL Deb 03 March 1986 vol 472 cc9-11

2.58 p.m.

Lord Bruce of Donington

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether they now know the identity of each of the six shareholders owning some 20 per cent. of the shares in Westland plc referred to by Lord Bruce of Donington in his question of 12th February 1986 (col. 197) and whether they are now prepared to name them.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth)

My Lords, I understand that Westland's investigations under Section 212 of the Companies Act have identified the beneficial owners of one of the six shareholdings as TNT Limited, an Australian company. The beneficial owners of the other five shareholdings have not yet been identified and the company is pursuing its inquiries.

Lord Bruce of Donington

My Lords, is the noble Lord aware that his noble friend Lord Trefgarne, when he was questioned by me about this matter on 12th February last, dismissed as fanciful my allegations that there were at least two Swiss banks interested in the shares to which I have referred? Will he agree that at a conference that took place in his department on 19th February it was, in fact, revealed that there were at least three Swiss banks which had purchased shares? Will the noble Lord make quite sure that the correction is made?

Will the noble Lord explain why, in view of the fact that Section 442 of the Companies Act gives his department full power to appoint an investigator to ascertain the beneficial ownership of shares, the Government have not taken action? What does the noble Lord have to hide? Why are the Government so coy on the whole matter? Why do they not come clean?

Lord Lucas of Chilworth

My Lords, in so far as the exchange between the noble Lord and my noble friend Lord Trefgarne on 12th February is concerned, my noble friend said: I am not certain from where the noble Lord gets his information. I understand that Westland say that there are no Swiss banks registered as holders of their shares."—[Official Report, 12/2/86; col. 197.] That position still applies in that there is no Swiss bank which is holding shares in its own right.

In so far as the powers under Section 442 of the Companies Act are concerned, since the company is energetically pursuing its investigations there seems little point in the Government running parallel investigations.

Lord Bruce of Donington

My Lords, are the Government really unaware that the Rothschild Bank, Zurich, holds 4.4 per cent. of the shares; the Gulf Occidental Investment Company of Geneva holds 1.4 per cent. and the Sterling Trust, Geneva, holds 4.9 per cent. Will the noble Lord now seek to correct the matter? Will the noble Lord convey to his right honourable friend that for so long as these names are kept quite unnecessarily secret there will be some suspicion that the Government have something to hide?

Lord Lucas of Chilworth

My Lords, as the House will probably be aware, on 24th February as a result of the company's 11th February issue of notices, there was a press statement which showed, in Actraint No. 34, that the Company of Canberra held 4.99 per cent. of total equity; Sterling Trust, Geneva, on behalf of nominees, held 4.89 per cent.; Rothschild Rank, Zurich, on the same basis, 4.76 per cent.; Bank of Dreyfus, Switzerland, 3.65 per cent.; Gulf Occidental 1.38 per cent.; and the Bank of Dreyfus, with others, 1.18 per cent. The company then issued further notices under Section 212, again to ascertain further the beneficial owners. The company is continuing its investigations.

As to the point the noble Lord made regarding suspicion, I believe that the suspicion lies only in his own mind.

Lord Bruce of Donington

My Lords, will the noble Lord nevertheless explain why the Government have not invoked the powers they have under Section 442 of the Companies Act?

Lord Lucas of Chilworth

My Lords, as I have already said, it is because the company is energetically continuing investigations. Until those investigations are completed there is no point nor necessity for the Government to embark upon another series of investigations.

Lord Grimond

My Lords, as this is a matter of considerable public importance, can the Government tell the House when they expect the investigations to be completed? If the investigations are not completed reasonably soon—after all, they have been going on for a month—when will the Government take the powers which they possess under that section to find out for themselves?

Lord Lucas of Chilworth

My Lords, the investigations were first announced by Westland on 11th February. It is now but the 3rd March. Noble Lords will also know that investigations of this nature take a considerable amount of time. I have said that the company is energetically pursuing its investigations under the powers available to it.

Lord Paget of Northampton

My Lords, but why did the noble Lord have to wait until the fourth supplementary question before giving his answer to my noble friend's Question? That seems very odd.

Lord Lucas of Chilworth

My Lords, I do not know that I waited for any particular period of time. I always, and at all times, try to answer to the best of my ability questions put to me by noble Lords.

Lord Morris

My Lords, has it not occurred to my noble friend that it is quite clear that noble Lords on the Opposition Benches fail to understand the distinction between de jure ownership and beneficial ownership? Even when it is discovered who are the apparent beneficial owners of shares, it is often very difficult to ascertain who are the real beneficial owners.

Lord Lucas of Chilworth

My Lords, that is exactly what the company is attempting to do. At the same time, the Stock Exchange is carrying out its own investigations to ensure that there has been no breach of its regulations.

Lord Tordoff

My Lords, in the light of the supplementary question from the noble Lord, Lord Morris, and the reply from the Minister, do the Government not feel a little worried that vital defence industries might be falling into hands that are so difficult to identify?

Lord Lucas of Chilworth

My Lords, the noble Lord, Lord Tordoff, must in his own mind distinguish between there being minority shareholders who perhaps do not reside in this country and control of a company, which has defence interests, changing hands. In the latter case we are quite satisfied that the Government have ample powers to deal with that matter.