§ 6.22 p.m.
§ Lord Hope of Craighead
rose to move, That this House takes note of the Report of the European Communities Committee on Prosecuting Fraud on the Communities' Finances—the Corpus Juris (9th Report, Session 1998–99, HL Paper 62).
The noble and learned Lord said: My Lords, at the heart of this evening's debate there lie two problems—and it may be difficult to decide which is the more troublesome.
It is beyond question that far too much of the Community's budget is being lost to it through fraud. That is the first problem. As we say in the opening sentence of our report, no one doubts the need to take action to protect the assets of the European Union against fraud, corruption and waste. But corruption and waste within the institutions of the Community is one thing. It can, for the most part, be dealt with by means of internal financial controls and other similar self-regulating measures. Fraud on the Community's budget is quite another. It crosses national boundaries. It extends far and wide throughout the member states, and beyond. It attacks and undermines the budget from both sides. It affects both income and expenditure. Crimes are being committed on a large scale. Not to put too fine a point on it, the Community's resources are leaking out in favour of the criminal. The budget is being depleted to the prejudice of all right thinking people throughout the EU.
The second problem is, in part, a product of the first. Everyone agrees that these crimes must be investigated, and that when the evidence has been gathered the offender must be prosecuted. But views differ as to the strategy which we should employ. As I have said, the fraud which needs to be combated crosses national boundaries. Indeed, it tends to exploit them. The involvement of several member states increases the prospect of delay and confusion, and it frustrates the criminal justice process. Some see the best way forward as being to improve measures of cooperation between member states. They believe that at the end of the day it must be for the prosecuting authorities of the member state with jurisdiction over the offender to bring him to justice. The Minister will correct me if I am wrong, but I believe that that is the position which the United Kingdom wishes to adopt. But there are others who wish to bring about a fundamental change in the way in which law and justice are administered throughout the Community. 631 For them co-operation is not the answer. They see harmonisation of laws and procedures—the creation of a single judicial area—as the most effective means of breaking down the obstacles created by national boundaries. It is worth noting that in this context the word "judicial" includes the functions of the investigating and prosecuting authorities as well as those of what we in this country mean when we refer to the "judiciary".
The movement which favours harmonisation appears from time to time in different forms. For the purposes of this debate it is to be found in the publication in April 1997 by a group of eight academic lawyers of a research paper entitled Corpus Juris. This paper, which was prepared at the request of the European Parliament, has been designed specifically to deal with the problem of fraud. Although this is a research report, not a formal proposal by the Commission, it seemed to the committee to raise issues of sufficient importance to merit the carrying out of a detailed examination by my sub-committee, Sub-Committee E. It is the report which was prepared following that examination and placed before the House last May which is before your Lordships for debate this evening.
I think that I can best assist your Lordships in three ways. First, I propose to say a little more about the nature and scale of the first problem—the problem of fraud. Next, I shall draw attention, in outline, to the main proposals in the Corpus Juris. Then I must mention a number of developments since the report left the committee's hands which are relevant to this debate.
First, how big is the problem of fraud, and what are its forms? As we explain in the report, fraud on the Community's finances may take many forms, such is the nature of man's ingenuity. But it can be divided up conveniently into income or receipts fraud and expenditure fraud. On the income or receipts side it consists typically of the making of deliberate mis-statements aimed at minimising customs duty or maximising refunds; the smuggling of cigarettes and alcohol; failure to register for VAT; bogus registration; fraudulent inflation of deductible input tax; or suppression of sales to reduce the true tax liability. On the expenditure side it may consist of claiming agricultural aid on the basis of a series of fictitious transactions or simply of embezzlement. The important point to notice is that much of this activity is the product of organised crime. A large proportion of it is trans-national and much of it is on a very large scale. According to official figures, about 1.4 per cent of the budget is lost to fraud. But the real figure may well be much higher than that. The figure of around 10 per cent was mentioned in evidence as having being placed on this by criminologists; and that is about 85 billion euros when measured against the 1999 budget.
Action has, of course, been taken by the Community. As background to our study of the Corpus Juris project, we took steps to inform ourselves about the various measures which are in place. The product of that part of our study is set out in 632 paragraphs 10 to 19 of the report. We thought it right to draw attention to the way in which the problem is already being tackled by Community institutions whose function is to detect and combat fraud within the Commission and in the member states, and by instruments which seek to promote co-ordination and co-operation between the investigating and prosecuting authorities. We believe that the Corpus Juris project should be examined in the overall context.
I turn now to the Corpus Juris—a rather grand name, to those familiar with the Corpus Juris Civilis, the Emperor Justinian's great codification of Roman law in the 6th century. What we are dealing with in the report is by comparison quite a modest document. You will find it printed at pages 36 to 44 of the report. It consists of two parts. The first part, which is headed "Criminal Law", sets out a uniform code of offences, to which are attached provisions dealing with a variety of related issues such as mens rea, penalties, concurrent offences and aggravating circumstances.
The second part, which is headed "Criminal Procedure", sets out a scheme which would confer powers of investigation and prosecution within each member state upon a new European public prosecutor. It would create a uniform set of rules of evidence and procedure which each member state would be required to adopt for prosecutions brought in his name.
It must be stressed that the authors of this document would demur to the suggestion that it is designed to create a uniform code of European procedure. They would point out that it is limited in its application to a particular group of offences, and decisions as to guilt or innocence and a wide variety of other matters are left in the hands of the national courts. But one does not have to dip very far into this document in order to discover difficulties. Almost all the evidence which we received was critical of it, and the two members of the committee which drafted it, and who gave evidence before us, acknowledged that much more work needed to be done, following an assessment of reactions, before it could be taken further to the stage of a proposal. There is no time for me to go into detail. But I should like to mention one or two points.
The fundamental objection to the scheme is that it is in conflict with the legal traditions of each of the three jurisdictions within the United Kingdom and, we believe, of other member states. The offence of fraud as we know it in this country is based on conscious dishonesty. Under the proposal, it would be enlarged, for the purposes of Community fraud, to encompass acts of negligence and recklessness. Where a single act creates concurrent offences, against both national law and the Corpus Juris, it would not be open to our prosecuting authorities to prosecute the offence against national law however desirable that might be.
Much of the detail of the procedure is difficult to reconcile with our own procedure. The conduct of the entire process of investigation and prosecution would be in the hands of the European public prosecutor, who would not be answerable to any of the national parliaments. The rights of the defence would be 633 weakened in comparison with those which we insist upon in our own courts. Those charged with offences could be remanded in custody for long periods, up to six months renewable for three months, on reasonable suspicion but without charge. Trial would be before a judge, specialising in economic and financial affairs, without a jury. The range of penalties bears little relationship to those which would be available to the sentencing judge in our own courts. And the legal basis in the treaty for such a scheme is, at best, doubtful.
Despite all these shortcomings, it is clear that the Corpus Juris project is not going to go away. It is a well-intentioned response to a real and pressing problem. The European Parliament has welcomed it. Indeed, it has said that it sees it as an example for future developments. The question of its compatibility with national laws has been under consideration by a group of experts for the Commission; the Comité de suivi. I understand that its report is now with the Commission, and that a revised version of the Corpus Juris has been prepared. It may be that the noble Lord the Minister will be able to confirm my understanding and perhaps say when these documents are likely to be published. As we state in the report, it is important that these documents should be in the public domain.
Furthermore, the underlying problem of fraud on the budget is still with us and everyone is agreed that further action to combat it is necessary. The "Committee of Wise Men", appointed by the European Parliament earlier this year, made a number of proposals which included the appointment of a European public prosecutor. So much will depend on the success or otherwise of the measures of co-operation on which the alternative approach to the problem relies.
At the end of our report we sound a note of warning. It is simply this. If the steps taken to improve assistance and co-operation do not produce effective results in the near future, serious consideration will have to be given to the setting up of a special regime for dealing with fraud on the Community's finances and possibly other forms of fraud within the EU. What that regime might be was not for us to explore. But we hope that something useful has been achieved by drawing attention to the many concerns and objections to the Corpus Juris scheme which were expressed by our witnesses.
Lastly, I must mention two points to bring the report up to date. First, as many of your Lordships know, a newly-established European Anti-Fraud Office (OLAF) has been established to replace UCLAF. Doubts have been expressed about its independence from the Commission—about which I say nothing—but there are other difficulties. Its director has not yet been appointed. Until that appointment has been made, steps cannot be taken to draw up a work programme. Nor can plans be made for the recruitment and training of new staff. So this new body has some way to go before its utility can be demonstrated.
634 Secondly, I must mention the Special European Council meeting held last October at Tampere. The Corpus Juris was not discussed, but I believe that useful progress was made with a view to better co-operation and convergence between the legal systems of the member states. It was concluded that the principle of mutual recognition, which was put forward by the United Kingdom, should be the corner-stone of co-operation in both civil and criminal matters in the EU. This is a process to which we in the UK, with our legal traditions, are particularly well-placed to contribute, against the background of the co-operation which exists at all levels between three legal systems in our own country.
The signs are that the strategy which favours mutual recognition and co-operation is, for the time being, winning the argument. The committee in its report indicates that this is the more realistic approach. Harmonisation, even on Corpus Juris lines, is likely to be a highly contentious and very time-consuming process. The fact is that the problem of fraud is already too great and too pressing for it to be sensible to proceed along these lines. Time is not on our side. I hope that the report will have performed a useful service by drawing attention to the substantial difficulties which harmonisation along those lines would cause and in supporting the case for mutual co-operation which is being made by Her Majesty's Government. The Motion is that your Lordships should take note of the report. I commend it to the House.
§ Moved, That this House takes note of the Report of the European Communities Committee on Prosecuting Fraud on the Communities' Finances the Corpus Juris (9th Report, Session 1998–99, HL Paper 62)—(Lord Hope of Craighead.)
§ 6.39 p.m.
§ Baroness Goudie
My Lords, as a member of the sub-committee, which was skilfully chaired by the noble and learned Lord, Lord Hope of Craighead, I should like to make one or two comments on the report. No one doubts the need to take action to combat fraud in the European Union's finances. The national laws and procedures of member states are not proving sufficiently effective. More and better practical co-operation is required. There is a real and serious problem which Corpus Juris seeks to address constructively, but it does not in itself represent a feasible way ahead. Its shortcomings are more significant than its potential benefits. Above all, the proposals in relation to criminal procedures are fundamentally flawed. The two which are of the gravest concern are the denial of jury trial in such cases and the creation of a European public prosecutor, the EPP, with enormous coercive powers.
It is a major defect that the EPP would not be accountable to any parliament, minister or judge and, indeed, would barely be accountable to anyone. When I probed that aspect during the taking of evidence before the sub-committee, we were told that what is envisaged is not political responsibility but merely disciplinary rules. That is simply not good enough. 635 The case for the creation of a supra-national system at that juncture has not been made out. Huge practical problems surround the relationship between the EPP and the national prosecutor specifically, and the co-existence of the legal regimes generally.
Those are not problems which will be overcome by limiting the scope of Corpus Juris. We must continue to press other options for reform. Those include further simplification of extradition procedures, fast-track mutual assistance, and jurisdictional and evidential changes. The best way forward is increased and improved co-operation at a practical level, which has worked well on the whole in relation to England and Wales, Scotland and Northern Ireland, and I believe, increasingly, in the Republic of Ireland.
The European Convention on Human Rights is already in force in much of the United Kingdom. It will within less than a year be in force throughout the United Kingdom. It is doubtful whether Corpus Juris in certain respects meets the minimum requirements of the convention. Corpus Juris fails in terms of both principle and practicality. The Government are right to regard the creation of a single uniform jurisdiction as not being a realistic way forward, and in pressing instead for streamlined co-operation between jurisdictions in fighting against cross-border fraud and corruption, not only in relation to EU funds, but also more generally.
§ 6.43 p.m.
§ Lord Wigoder
My Lords, as a member of the sub-committee I too pay my tribute to the noble and learned Lord, Lord Hope of Craighead, for the fascinating combination of charm and efficiency with which he conducted our proceedings so helpfully to us all.
Noble Lords will have read the report and have certainly listened today to a clear exposition of its principal features. It is quite unnecessary for me to repeat what the noble and learned Lord has said about this rather tentative and incomplete study called the Corpus Juris by a group of a number of distinguished academics. Out of that proposal there have emerged three serious misconceptions which I believe were in danger of fouling up the whole discussion on the future of the issue. It might perhaps be of assistance to your Lordships if I made a brief comment about each of the three.
The first misconception is that the Corpus Juris is a study that has some official status and that it has in some way or another been adopted by the Commission. That is simply not true. Paragraph 20 of our report states:It is not a formal proposal of the Commission. It has the status of a research report or study".Paragraph 23 states:The Commission has taken no view on the proposal and given no commitment to pursue and adopt it".636 The noble and learned Lord mentioned the Tampere European Council meeting which took place recently. Your Lordships may be aware of the comments made by Mr Charles Clarke on behalf of the Home Office in the other place a few weeks ago:'Corpus Juris' was not a topic for discussion at the Tampere European Council, nor did the European Council endorse any of the specific proposals in 'Corpus Juris'…There was a brief discussion on whether to examine one Corpus Juris proposal. the idea of creating a European Public Prosecutor, concerned only with protecting the financial interests of the Community, but this was not pursued".—[Official Report, Commons, 5/11/99; col. 370.]Those statements in our report and by the Home Office make it clear that the proposal, when it first emerged, was greeted with a somewhat hysterical reaction by observers in this country. I refer, for example, to the Daily Telegraph on 30th November 1998, which in large black type carried the headline:Alarm over Euro-wide justice plan".A small paragraph on the front page referred to articles inside:Rewriting Magna Carter: Page 4Editorial: Page 21Boris Johnson: Page 34".The main article referred to the,Proposals for a common judicial area",which were in their early stages, but,could shortly be adopted for European Union fraud cases and might form the basis for a unified criminal justice system in the future … The plan, drawn up under the aegis of the European Commission, has alarmed the Government",and so forth. Indeed, some months later the same newspaper stated on 1st June 1999—although I am unable to find any support for the assertion—that,Last month, the European Parliament voted in favour of the idea being pursued".If we could get the status of this fascinating study right, it might help in the rational discussion of it.
The second gross misconception is that the activities which the Corpus Juris has been devised to defeat can be in some way used as a stick with which to beat the Commission. The fraud being investigated by the sub-committee and by the body which produced the Corpus Juris has no sort of relationship with the misuse of Community funds, which has quite rightly had so much publicity recently from the reports of the Court of Auditors and the Committee of Independent Experts. The report and the Corpus Juris deal with matters which had nothing at all to do with those issues.
We and they were both concerned with the activities of common criminals, whether individuals or corporate bodies, who were pursuing financial fraud against the Community on a cross-frontier basis where the differences in jurisdiction between the countries concerned was liable to cause confusion, delay and incompetence in bringing those common criminals to justice. As your Lordships have heard, the result is that some billions of pounds appear to have been lost through offences such as smuggling. They have been lost at the expense of both the member states and the 637 Commission. The Corpus Juris which the academics produced was a brave attempt to deal with an extremely difficult problem.
The third misconception is perhaps the most serious. It is that the Corpus Juris proposals by the academics, if adopted, would lead to a change throughout the national legal systems of the countries in the European Union. For example, in August 1997, the Daily Mail referred to it as a plot by Brussels to dictate crime policy to the British Parliament; that it would be the end of habeas corpus. That is a suggestion which our committee, when it investigated it, concluded was quite unfounded.
In the issue of 30th November, to which I have referred, the Daily Telegraph referred also to the habeas corpus allegation and added that it would replace our procedure by a Napoleonic code and that it would lead to the rewriting of Magna Carta.
Professor Spencer, who was one of the most distinguished of the academicians concerned, offered to write an article for the Daily Telegraph setting out clearly what was involved in the Corpus Juris but it became apparent, I suppose, that such an article would not interest the readers of that paper and, sadly, his offer was not accepted.
It is important to realise that what this report and the study were concerned with and, therefore, what your Lordships' sub-committee was concerned with, was limited entirely to the issue of financial frauds committed across frontiers against the Community finances. It was that and nothing else. The suggestion is totally misconceived that if your Lordships were to go at some time in the near future to sit in Court 1 at the Central Criminal Court, you would find the spectacle of the judge conducting the whole proceedings on an inquisitorial basis, with the lawyers occupying very much of a back seat and the jury box having been dismantled completely by enthusiastic carpenters. That is certainly no part of any proposals by the European Commission. Of course, I cannot be responsible for whatever our Home Secretary proposes in those directions.
In those circumstances, your Lordships' sub-committee reached the conclusion, with which I hope that your Lordships will agree, that this study was a serious contribution to consideration of possible ways of dealing with a very serious problem. The committee reached the conclusion also that certainly at this time, in the present atmosphere, it was not possible for us to take the matter further by recommending it or approving it in any way and that there were alternative ways of dealing with those grave problems.
§ 6.52 p.m.
§ Lord Norton of Louth
My Lords, I too very much welcome the report. Like the noble Baroness, Lady Goudie, and the noble Lord, Lord Wigoder, I too am a member of Sub-Committee E. I too pay tribute to the work of the chairman, the noble and learned Lord, Lord Hope of Craighead, and our excellent staff.
I note also that the noble Lord, Lord Goodhart, who is yet to speak, is also a member of the sub-committee and that the noble Lord who is to reply 638 from the Government Front Bench, the noble Lord, Lord Bach, was a member of the sub-committee at the time that the report was drawn up, which bodes rather well for the response from the Front Benches. I hope that my noble friend Lord Cope will not feel too isolated in this debate.
I begin by making a general point. This report, along with other reports from the European Communities Committee, which your Lordships have had the opportunity to debate, demonstrates the value of the committee work of this House. There is a marked contrast between our approach to domestic legislation and our approach to European legislation. Yesterday, I spoke in the debate on the gracious Speech. I drew attention to the fact that we do not usually employ investigative committees for the consideration of government Bills. As a revising body, this House is extremely good, indeed extraordinarily good. It adds value to the legislative process. It could be even better through making greater use of Select Committees.
In the sphere of European legislation, your Lordships' House works principally through a Select Committee. The work of that committee shows what can be achieved through inquiry by committee. It enables a particular subject to be considered in depth; for evidence to be taken from interested parties; and for a considered report to be produced informing debate not only in your Lordships' House but also in other political arenas.
It may be a cause for regret, but it is none the less true, that a report from a committee of your Lordships' House, widely disseminated, will reach a much wider audience and may have a greater impact than a debate in your Lordships' House.
The value of such committee work could not be better demonstrated than by the report which we are considering today. When the proposals for a common criminal code, the Corpus Juris, were published, as we have already heard, they attracted coverage in the media which contributed only partially to one's understanding of what the proposals were. I make no particular complaint about that. Complex proposals are difficult to summarise in a few words, especially by those who do not have a background in the subject, although I note, as the noble Lord, Lord Wigoder, has already mentioned, some of the coverage generated more heat than light.
But before we criticise the media too much, let us consider what type of debate we should have had in this House had we debated the Corpus Juris proposals without the benefit of this report. I know that we should have had some informed contributions but we should be lacking the advice and information of many with expertise in the field. The material drawn together in the report is substantial, as much in quality as in quantity, and any debate would be the poorer without it.
Much can be learnt from how we proceed in dealing with European legislation. We can and should make greater use of committees, not to compete with but to complement our existing procedures.
639 I turn now to the substance of the report. As has already been mentioned, there can be little doubt that the Corpus Juris proposals address a major problem. Fraud on the Community's finances takes place on an extensive scale. The noble and learned Lord, Lord Hope of Craighead, has indicated already the evidence that we received. Official figures suggest it is about 1.4 per cent of the Community's budget, but one estimate that we received is that it is about 10 per cent; in other words, well in excess of £5 billion per year. If that figure is correct, it is staggering.
There is thus a problem which is massive in scope which requires action, and immediate action. The proposals for Corpus Juris, drawn up, as we have heard, by a team of legal experts, represent a genuine attempt to address a real problem. One can appreciate the motivation for the proposals; in many respects, one can appreciate the case made for them. As the noble and learned Lord has already mentioned, we took evidence from two of those responsible for the proposals and they made good witnesses.
However, the proposals as they stand are flawed. The limitations are adumbrated in the report. One of the strengths of the report is the way in which they are clearly and concisely laid out. Given that, I do not want to dwell on them too much. As is made clear in the report, the proposals lack a clear legal basis. The European public prosecutor would be largely unaccountable to an elected body; there are problems as to the feasibility and the acceptability of the proposals at national level; and the problem of dealing with fraud committed outside the European Union is not adequately addressed.
Indeed, the problems are very well summarised by looking at the headings in Part 3 of the report: the Corpus Juris is not popular; it lacks a proper treaty base; it is not practical; and it is defective and incomplete. Clearly, the Corpus Juris is not, at the moment, the way forward.
What is the way forward? The report considers alternatives and I want to draw out what I consider to be two very positive features deriving from the report. The first is a need for a twin-track approach. Not only must rigorous mechanisms be in place to ensure that those who commit fraud are detected and prosecuted but also rigorous mechanisms need to be in place to prevent fraud occurring. Several witnesses drew attention to procedures which could be employed to cut down on fraud on the Community budget. Several major initiatives are now under way although I was struck by evidence which suggested that some fairly modest reforms could have a considerable impact on preventing fraud.
In terms of transit fraud, for example, we were told that the introduction of a computerised system costing a fraction of the cost of the lost revenue could eradicate most of this loss. In view of recent events, the need for stronger discipline within the Commission to prevent fraud is now recognised.
640 The second requirement is for a "bottom up" approach. Witnesses were sceptical of the "top down" approach represented by the Corpus Juris proposals. They recognised that co-operation between national authorities represented a more feasible and acceptable way forward. One of the problems that clearly came across was that there has been a lack of co-operation. However, what came over in evidence was the extent to which that is now changing. The report draws attention to three developments in particular: a judicial network, peer review and joint action.
What also came over in evidence were other practical proposals that could and indeed should be pursued. The report mentions, for example, extending the use of fiscal liaison officers. It goes on to state that that might require a moderate increase in resources. Given the sheer scale of the problem, I believe that a moderate increase in resources is more than justified. In the context of national co-operation, the role of the Commission should perhaps be one of encouragement, not imposition.
In conclusion, the problem addressed by the report is clearly a major one. That is indisputable. The question is, how does one address that problem. The Corpus Juris proposals are not the answer, for the reasons given in the report. A "twin track" and "bottom up" approach is a more feasible response. However, as is abundantly clear from the report, there is still a great deal to be done, including that to be done by the British Government in order to implement these approaches. It is vital that the Government not only commend the report but also act upon it. I hope that the committee will return to the subject at some future date. From the evidence we took, two things are abundantly clear. The need for action is urgent and there are absolutely no grounds for complacency.
§ 7.4 p.m.
§ Lord Pearson of Rannoch
My Lords, I join others in congratulating the noble and learned Lord, Lord Hope of Craighead, and his committee on this succinct and well-balanced report. However, I intervene because I do not quite share the confidence of the noble Lord, Lord Wigoder, on the low status of the Corpus Juris project in Brussels.
I say that because last week I was speaking to an MEP who sits on the European Parliament's committee which is considering this project; no names, no pack drill. However, he tells me that there is a serious enthusiasm in Brussels for Corpus Juris and a determination to promote it. That would fit with the views of those of us who believe that the European Union really does want to end up as a superstate one day and has determinedly set its face against the Europe of nations collaborating together which so many of us would prefer. That, for instance, is why the EU aspires to have the common foreign and defence policy, because a state needs that.
It is not, therefore, unreasonable to believe that, at the end of the day, there is similar enthusiasm for a common legal system, down the road to which this seems to many of us to be just the first step. Over the 641 years we have often been told first that an EU initiative does not really exist. Then we are told that it does not really matter; it is only being discussed. Before we know where we are it has happened, and then it is too late because we should have been alive to it earlier.
§ Lord Tordoff
My Lords, I thank the noble Lord for giving way. Is not that precisely what the report is about; namely, drawing attention to this Parliament and the Government so that those fears can be assuaged? While I am on my feet, perhaps I may say that if the noble Lord is to quote someone, he should tell us who it is, in this privileged place. To produce evidence and no names is unconvincing.
§ Lord Pearson of Rannoch
My Lords, of course. I was merely trying riot to ruin the career of the poor young MEP in question. However, if the Chairman of your Lordships' Committee requests me to do so, it is Daniel Hannan, who I believe is MEP for the south-east of England. I welcome the noble Lord's intervention. It brings me to the question I was about to raise.
I do not believe that this project will go away. Even the noble and learned Lord, Lord Hope, indicated as much. I absolutely welcome the way forward which the Government are pursuing. However, on reading paragraphs 115 to 118 of this excellent report, my question to the Government is that there seems to be some doubt about the treaty basis of this project. Does Corpus Juris lack a proper treaty base? Are the Government absolutely sure that at the end of the day, as this project develops, if it does, the United Kingdom could veto it, if it comes to that?
§ 7.5 p.m.
§ Lord Goodhart
My Lords, like other speakers in the debate who were members of the committee, I pay tribute to the noble and learned Lord, Lord Hope of Craighead, for the admirable way in which he chaired our meetings and oversaw the production of the report.
I first became aware of the existence of the Corpus Juris just over a year ago. That is when I was invited to attend an inter-parliamentary conference on the fight against fraud on the European Union budget. That conference was attended by Members of the European Parliament and of national parliaments. The UK was represented by a Conservative MP, Mr Humfrey Malins, myself arid a number of MEPs. There were representatives present from all but two of the member states of the EU.
One of the main subjects of debate at that conference was the Corpus Juris. As the noble and learned Lord, Lord Hope of Craighead, said, the Corpus Juris was drafted by a team of academic lawyers, including Professor John Spencer of Cambridge University, and published as a discussion paper, not as a proposal for action. The reception given to the Corpus Juris by the inter-parliamentary conference was mixed. It certainly received a fair amount of support. However, there were also widespread criticisms of it, especially from 642 representatives of the United Kingdom and other north European states. I left that conference convinced that if the views of the delegations were representative of the views of the countries from which they came, the Corpus Juris, certainly in anything like its present form, stood no chance of adoption.
Nothing since has made me change my mind on that. I have to say that a few days later I read an article in the Daily Telegraph. I cannot remember whether it was an article by, or an interview, with Mr Malins. It was only then that I realised that he and I appeared to have attended different conferences. The conference which I attended consisted of a serious discussion of an interesting set of proposals for dealing with the undoubted problem of fraud on the European Union's budget. Those proposals were widely seen in that conference as over-ambitious and unrealistic.
The conference attended by Mr Malins was an attempt, masterminded by the faceless bureaucrats of Brussels, to destroy habeas corpus, put an end to jury trials, and subject us to the unspeakable horrors of continental legal systems. In the eyes of Euro-paranoiacs, the Corpus Juris has become evidence of a sinister plot to undermine and destroy our legal system. I have to say that belief in such a plot is no more justified than belief in the authenticity of the protocols of the elders of Zion.
Nobody can doubt that the fraud problem is extremely serious. I believe that there is a strong case for harmonising the substantive laws on fraud on community finances. Speaking for myself, I would broadly welcome Part I of the Corpus Juris which seeks to establish a common set of offences covering fraud on the European Communities wherever those offences are committed. The proposal certainly goes too far in some respects, particularly in making the head of a business criminally liable for the dishonest acts of his subordinate, where the head of the business has merely failed to exercise proper supervision and has not acted dishonestly.
It is the procedural rules in the Corpus Juris which are much more controversial. It is neither practicable nor appropriate to have a European public prosecutor's office in each member state operating in the national courts, but operating under its own laws and procedures yet not being accountable to the government of the state in which it is operating. It is not acceptable to remove the right to jury trial for Community fraud cases so long as juries are retained for other sorts of case. It is not acceptable to provide for remand in custody without charge for a period of six months, extendable for a further three.
Jury trials could probably be put back into the Corpus Juris, and remand without charge taken out of it. They are not essential to the project. But the centrepiece of the system—the European public prosecutor—working through separate but parallel systems in the same courts is unlikely to prove workable, and without that the Corpus Juris would have to be completely rewritten.
I believe that the report of our committee is balanced and fair. We do not believe that at the present time the Corpus Juris offers a practically feasible or 643 politically acceptable way forward. The noble and learned Lord, Lord Hope of Craighead, drew attention to our alternative proposals. In particular, we call for more effective mutual assistance between member states, and for ratification of the 1995 convention on the protection of the European Community's financial interests and its protocols.
One issue that should be considered outside the Corpus Juris is the modification of the highly technical English rules of admissibility of evidence. They create unnecessary barriers to the introduction of evidence taken in other member states for use in English trials. We were told in evidence that at least one major prosecution had collapsed because vital evidence was ruled inadmissible on technical grounds.
I should like also to draw attention to a subject mentioned in the report but not touched on in this debate; that is, the question of Eurobail. In some countries, foreigners find it extremely difficult to get bail because of the risk of their not appearing at trial if they are allowed to return to their home countries elsewhere in the European Union. Under a Eurobail system, which would not be limited to charges of Community fraud, defendants on bail who were residents of another member state would be automatically arrested and returned by the authorities of their state of residence to the state of prosecution if they failed to turn up for their trial. That would make the judicial authorities much more willing to grant bail to residents of other member states of the European Union.
This is a useful and important report. I hope that those noble Lords present this evening who were not members of the committee—that is perhaps rather fewer than those who were—come to the same view.
§ 7.13 p.m.
§ Lord Cope of Berkeley
My Lords, I too am grateful to the noble and learned Lord, Lord Hope of Craighead, and his colleagues on the committee. As my noble friend Lord Norton of Louth said, I thought I would be exclusive in being the only speaker who was not a member of the committee. However, I had the support of my noble friend Lord Pearson so that did not materialise. However, I am sure I speak for the whole House in thanking the committee for the extremely detailed work it did in producing this report and for the measured way it sets out both what the Corpus Juris is about and its conclusions on it.
I was particularly pleased this afternoon to hear support for the jury system from all sides of the Chamber, which is a matter to which we will return in another context. But on the main question before us, no one can doubt that there are extremely serious problems which lie behind this proposal. The noble Lord, Lord Wigoder, referred to the Court of Auditors' report for 1998 which was published a few days ago. That makes serious reading. I was an auditor at one point and they are as much concerned with fraud as with inefficiency.
644 Speaking as a chartered accountant, though I have not practised for a long time, I can say that auditors are necessary. However, their existence does not eliminate fraud, though hopefully it helps to minimise it. Fraud is not something which can be eliminated. It can be and should be fought and minimised, but it is a continuing battle. Every time one loophole is closed then expert and clever fraudsters look for the next one.
The fact that a serious problem exists, as every speaker in the debate recognised, does not mean that any solution is therefore acceptable or that it will work. The Corpus Juris idea seems to stem from the proposition that it is no use trying to work through different legal systems and getting them to work together, across boundaries within the Union, when those boundaries for other purposes are ceasing to exist; and that instead one should impose a new, though not completely new, and extensive system on top. I believe that idea to be fallacious.
First, the United Kingdom demonstrates that different legal systems—we have three, as the noble and learned Lord said—can co-exist and that fraud, and other offences, can be successfully prosecuted within those systems. We have had distinguished lawyers from at least two of the jurisdictions speaking in this brief debate and I believe the noble and learned Lord is also distinguished in the Northern Ireland field.
Secondly, if the Corpus Juris were to be adopted in this form or something like it, it would impose two systems on each member state—the Corpus Juris itself pursuing one lot of fraud and national laws pursuing other types of fraud. And fraud cannot be compartmentalised quite that neatly. Of course, some frauds are solely devoted to defrauding the Community and others are devoted to defrauding other people or other institutions, but there is a considerable overlap at the margin. Quite often one crime involves others. Also, the idea does not get away from the fact that two systems would still be involved.
Thirdly, the system ignores the fact that organised international crime is not confined to the European Union. That comes out in parts of the report. It is not necessary to go over the report in detail; it was expertly summarised for us by the noble and learned Lord in opening the debate and it is there for all to read. But I agree that it is valuable because of its expert, though moderate language. It does not fall into the hysterical category mentioned by the noble Lord, Lord Wigoder, and is all the more forceful because of that. It would be nice to think that this Select Committee report will kill off the idea as it now exists. I think it certainly ought to be studied in Brussels.
As the noble Lord, Lord Wigoder, pointed out most effectively, the fact that it is unofficial at this stage means that this is the moment when we should draw attention to the unacceptability of this set of proposals. I hope that United Kingdom MEPs will draw the report to the attention of their colleagues in the European Parliament, so that they realise the position.
645 I hope that the Minister will be able to tell us that in the Government's view no further time should be wasted down what seems to be a blind alley. It is not just a question of not wasting time; the difficulty is that studying the Corpus Juris, with it unacceptable characteristics, especially the prosecutor—here I agree with the noble Lord, Lord Goodhart—and pursuing such proposals distracts people from paying attention to what should really be done.
I do not wholly subscribe to the views expressed from the Liberal Democrat Benches about the question of a "plot" to start with the Corpus Juris and open it up. As pointed out by my noble friend Lord Pearson of Rannoch, there are those who see this as the beginning of a much wider affair. If the authors of the report did not wish it to be perceived that way, they should not have given it such a grandiose name. As the noble and learned Lord said, that refers back to a much wider system. I am not a lawyer but, as I understand it, that refers back to a much wider system of law covering many more matters. To choose that name for this proposal is to open it up to misunderstanding. Therefore, to a considerable degree, it is their fault that it is seen in this way by many people.
If the Corpus Juris is not acceptable as it is, what else should be done? I do not want to take the time of the House for too long on the matter. After all, Commissioner Kinnock is working on the problem and will report before long. No doubt we shall all have the benefit of more views and then be able to take the matter further. Some of us think that it is a little like a member of the poachers' union advising on the working instructions for the new gamekeepers. But, still, we shall wait and see what is said.
It seems to me that an anti-fraud office in Brussels should he independent of the Commission. In this country we accept without question the operational independence of the police, and the situation that we are now discussing is similar. Therefore, I do not believe that that proposition will attract much opposition in this country. I also think that the European Parliament needs to strengthen the Budgetary Control Committee. The lines developed in another place with the Public Accounts Committee over many years would provide a suitable basis.
I had some involvement with the European budget when I held responsibility for it for a while in the Treasury. I negotiated with the European committees during our European presidency. That was some years ago, but I do not think that they have improved much since then. I also had some experience of international anti-fraud operations as part of the responsibilities which I held for a while for Customs & Excise. Customs co-operation agreements were developed with all sorts of countries around the world, which certainly improved the situation in the fight against fraud. However, they did not solve international fraud—indeed, as I have said, that is not a possibility—but they went much further than the European Union. Of course, in particular 646 commodities, and so on, and in certain types of fraud with which Customs were concerned, different groups of countries were relevant.
The point about fraud being larger than the European Union itself is an important one. It is one of the difficulties of the Corpus Juris that it is intended to be limited to the EU. It is noteworthy that one of the basic agreements in this field is the European convention on mutual assistance in criminal matters of 1959, which is not an EU convention; it is a Council of Europe convention. After all, there are now 40 countries in the Council, although I am not sure that they have all signed up to the convention. I believe that the way forward in combating fraud both within the EU and wider is mutual recognition and co-operation between the national authorities.
I hope that this excellent Select Committee report will help to avoid further distraction in the direction of the Corpus Juris. When I say "hope", I am aware that one does need a good deal of hope if one is thinking that that is exactly what will happen. Nevertheless, that is what I believe should happen. We are all extremely grateful to the Select Committee for this report.
§ 7.25 p.m.
§ Lord Bach
My Lords, I understand that it is customary to congratulate all the members of the Select Committee who drew up the report under debate upon their skill, hard work and general all-round perspicacity. But I hope that your Lordships will forgive me if I do not indulge in this general paean today. As your Lordships know, I was fortunate enough to be a member of Sub-Committee E as it heard evidence, reached conclusions and completed the report. Therefore, it would look suspiciously like self-congratulation if I were to go into raptures about the general quality of the whole committee. Although self-congratulation is not entirely unknown in your Lordships' House, it should perhaps be rather more subtle and under-stated that such a declaration would be.
More seriously, I can tell noble Lords that it was a real privilege to serve under the chairmanship of the noble and learned Lord, Lord Hope of Craighead, and to be in the company of, and work with, such distinguished Members of your Lordships' House, both lawyers and non-lawyers, as those who made up the sub-committee. I am delighted as well as perhaps a little personally relieved to be able to say that Her Majesty's Government agree for the most part with the conclusions of the sub-committee. Perhaps I may add what has already been said by several members; namely, that the sub-committee was extremely fortunate in the quality of the assistance that it received from its staff, especially from Dr. Kerse.
The problem of fraud and corruption involving the institutions or finances of the European Community is a very serious one which damages public confidence in the integrity of the Community as well as causing the loss of large amounts of taxpayers' money. The Government want to see strong and effective action 647 taken to combat this type of fraud. As I shall endeavour to explain, the Government have taken a number of initiatives to strengthen European co-operation in this area in view of the cross-border nature of much financial crime. In particular, the recent European Council meeting at Tampere strongly endorsed the United Kingdom's initiative on mutual recognition of judicial decisions.
The question is whether the package of proposals known as Corpus Juris would be a useful and feasible way of fighting fraud. We have had explained to us in extremely clear terms the background to the production of the report in 1997. It has been described as a "very green paper", which is perhaps the best description of it; indeed, that point was made by the noble Lord, Lord Wigoder. The Corpus Juris proposals envisage far-reaching changes to judicial co-operation with the EU. The key proposals that we have already heard about are the creation of what would amount to a European penal code for fraud offences affecting EC finances; a common procedure for investigating and prosecuting these offences; and, perhaps most significantly, a European public prosecutor to oversee investigation, prosecution and the enforcement of penalties.
A number of the proposals would obviously conflict with the legal traditions of many member states, including the United Kingdom. As has already been said, the European Commission has asked its experts to carry out a further study to assess the extent to which the Corpus Juris recommendations are feasible and necessary. As I understand it—I wish that I could be more exact about this—the report is likely to be published shortly. I understand that it is to be submitted shortly to the European Parliament and to the Council of Ministers. I understand that it will offer a revised version of the proposals which takes account of some of the concerns expressed in member states.
I add here, in regard to remarks made by the noble Lord, Lord Cope, and other noble Lords, that, as I understand it, our report has been read by the European Commission, which may well pay regard to what we say when it considers the future of the Corpus Juris. Of course the Commission and the Council of Ministers will decide whether and how to pursue this concept.
But what is the Government's position on the document as it stands? The Government fully agree with the objective of the Corpus Juris paper, which, in trying to provide more effective judicial remedies against fraud, is commendable and worthy. However, we do not agree that this objective should be achieved by "unifying" the laws and procedures of all member states, or by creating a European public prosecutor with the powers proposed in the report. We have a number of concerns which relate mainly to the proposals on criminal procedure (part two) rather than criminal offences (part one). I deal with these briefly because they have been covered in a remarkable spirit of unanimity by all who have spoken tonight.
648 First, in seeking to unify the laws and procedures of member states in cases of Community fraud, Corpus Juris would effectively create a separate criminal jurisdiction within each member state. The noble Lord, Lord Cope of Berkeley, made that point. Secondly, it would insert inquisitorial procedures into what is a largely adversarial system, especially in England and Wales, raising fundamental issues for procedure in criminal trials.
Thirdly, Corpus Juris would change key provisions of the European Union fraud and corruption conventions. We would not wish to support proposals to amend these provisions before they have been brought into force and given a proper chance to have an impact. Fourthly, as the need for it cannot be clearly demonstrated, it is the Government's view that Corpus Juris conflicts with the principle of subsidiarity.
Fifthly, a European public prosecutor would have power to direct investigations and prosecutions, to request a person's detention without charge for up to nine months and to oversee the execution of sentences, and yet would have little, if any, domestic accountability either to Parliament or to United Kingdom judicial authorities. That point was well made by my noble friend Lady Goudie. That would represent a departure from the position which was agreed in the Amsterdam Treaty, according to which the application of criminal law remains within the competence of member states.
Finally, we agree with the committee's finding that Corpus Juris has no proper treaty base. Under Article 280(4) of the EC Treaty, the Community cannot adopt anti-fraud measures which concern,the application of national criminal law or the national administration of justice.I comfort the noble Lord, Lord Pearson, further. It is right to say that any change to that would have to be unanimous.
§ Lord Pearson of Rannoch
My Lords, I am grateful for what the noble Lord has just said. Do the Government have the same confidence about the other possible hooks in the treaty upon which this eventual project might be hung, leaving aside new Article 5 of Amsterdam, subsidiarity and proportionality, in which some of us have no faith at all? There are other articles in the treaty which are mentioned—for instance, in paragraph 118—as possible hooks on which we could be outvoted. Perhaps the noble Lord will write to me in due course, but I think that it is worth covering that point while we are at it.
§ Lord Bach
My Lords, I understand the point that the noble Lord makes. Essentially it seems to us that the first hurdle—it is rather a large hurdle—that the Corpus Juris would have to get over is Article 280(4).
The Government therefore agree with the conclusions of the European Communities Committee's inquiry; namely, that Corpus Juris does not offer an acceptable way forward. I wish to echo what the noble and learned Lord, Lord Hope of 649 Craighead. said. Although we do not think that the present proposals are either practical or necessary, the Government believe that some appreciation is due to the authors of the original Corpus Juris proposals because their effect has been to concentrate minds and to give further impetus to finding practical solutions to the real problems of fraud as regards Community finance. In the remainder of my speech I shall make some comments about what the Government have been doing in terms of finding practical proposals to address this problem.
Noble Lords will not be surprised to hear that in place of Corpus Juris the Government believe that judicial co-operation between member states should be strengthened on an intergovernmental basis, as stipulated by the Amsterdam Treaty. Perhaps the best way to express this is the way that the former Home Office Minister in another place, Ms Kate Hoey, used in giving evidence to the committee. In talking of the Government, she said at paragraph 94 of page 24 of the Select Committee's report:We fully support co-operation across the European Union to promote common standards in relation to justice and the rule of law and particularly to fight against organised crime, corruption and fraud".The next sentence is perhaps the best way of expressing the matter. She said:We … support co-operation between jurisdictions rather than creating a single jurisdiction".This does not mean that we should be content with half-measures. Traditional co-operation under international conventions has not solved the problem, so we need to look for more radical solutions. The Tampere European Council last month pointed to new ways to make progress. In particular, it strongly endorsed the United Kingdom's initiative on mutual recognition and enforcement of judicial decisions, agreeing that this principle should become the "cornerstone of judicial co-operation" within the Union, and asked the Justice and Home Affairs Council and the Commission to adopt a programme of measures to achieve this by December 2000—now only 12 or 13 months away.
The Government launched the idea of mutual recognition last year during our presidency of the European Union, and the Home Secretary developed it further in a speech at the Avignon Seminar on the European Judicial Space in October last year. We included it in the United Kingdom's position paper for Tampere. Rather than trying for a unified criminal code, the aim will be to enforce judicial decisions even though they have been taken under different rules. We believe that this offers scope for a more realistic approach to securing significant improvements in co-operation.
I shall say a few words about what we mean by "mutual recognition". The concept of mutual recognition is modelled on mutual recognition of rules and standards for goods and services exchanged in the single market. Mutual recognition is the principle that different national standards should be treated as equivalent. In this case, decisions or orders issued by a criminal court in one EU member state, based on its 650 legal system and procedures, would be recognised by another member state and could be enforced there. The key underlying concept is the principle that member states of the EU should be able to have full confidence in each other's legal systems.
What this means in practice is that certain decisions in criminal matters made by a foreign EU court could be directly implemented in other member states with minimum formality, and ultimately without having to be approved by a court in the requested country, as happens now. An example would be fast-track extradition whereby people who are given bail to return to their home country, but then fail to turn up for trial in the country where they stand accused, could still be prosecuted without the need for lengthy extradition procedures. The "Eurobail" concept mentioned in the debate, which the European Parliament has supported, would benefit those of our citizens who are arrested in other member states.
The Government have made clear that the recognition of court orders and warrants issued in other member states will need to be accompanied by adequate safeguards for the individual, and those safeguards will need to be agreed between the member states. All the legislation in this area will need to be adopted by unanimity. We will consult Parliament and other interested authorities fully in the process. This will take time, but Tampere has given the work some momentum and the Government will be pressing our partners for early progress. A mutual recognition will sit alongside a continued programme of selective approximation of key offences in order to ensure that all member states have adequately criminalised the most important forms of cross-border criminal conduct.
The agreement at Tampere to create a "Eurojust" institution, made up of prosecutors and investigators seconded from the member states, will help to overcome the sometimes slow and cumbersome procedures between member states. We hope that Eurojust will facilitate co-ordination between national prosecuting authorities, support national criminal investigations into organised crime and co-operate closely with the European judicial network. We do not believe that Eurojust's remit should or will be confined solely to EU fraud.
I shall deal with, as shortly as I can, a number of additional initiatives. The Council called for the establishment of a European police chiefs operational task force to exchange, in co-operation with Europol, experience, best practices and information on current trends in cross-border crime. There is to be a European police college for the training of senior law-enforcement officers. The noble Lord, Lord Norton of Louth, referred to fiscal liaison officers. He will be happy, I hope, to hear that the Government support the idea of fiscal liaison officers being appointed.
There are other measures, too. We particularly welcome the establishment of OLAF, the European anti-fraud office which has taken the place of UCLAF. We bear in mind the point made by the noble and learned Lord, Lord Hope of Craighead, that there is 651 still some way to go in regard to that. We would like to see it more fully develop its investigative role within the Community institution. We will be urging it to develop an effective working relationship with national prosecutors.
The members of the subcommittee will, I hope, be pleased to hear—they almost certainly already know it—that the concern shown about the delay in ratifying the convention on protection of the Community's financial interests of 1995 need no longer be a concern. The Government have now ratified this convention, with all of its protocols, and also the EU convention of 1997 on the fight against corruption.
EU negotiations are under way to modernise the Council of Europe Convention on Mutual Assistance 1959. This is an important step. For example, the draft convention will require evidence to be collected in accordance with procedures required by a requesting state to ensure its admissibility. The draft convention also provides for new forms of co-operation, such as the use of live video links for taking evidence and the use of joint teams.
A programme of mutual evaluation is currently under way to assess each member state's performance as a mutual assistance partner. The evaluation reports identify weaknesses and recommend improvements. An evaluation of the United Kingdom is planned to begin in February next year. I am happy to be able to tell the House that the Home Office's Judicial Co-operation Unit has engaged an expert from the Serious Fraud Office—a person experienced in European judicial ways, prosecutions and mutual assistance matters—to review our mutual assistance procedures.
In conclusion, it must be obvious by now that the Government agree with the view of the subcommittee and of the committee above it that energy and resources would be better directed towards increasing mutual legal assistance and practical co-operation between EU member states, rather than seeking the erection of a unified criminal code.
Thanks are due to the subcommittee for producing the important report that we have debated. In the Government's view, it has undoubtedly given a momentum to dealing with a very serious problem.
§ 7.45 p.m.
§ Lord Hope of Craighead
My Lords, I am extremely grateful to all noble Lords who have spoken in the debate. I am also grateful for the very kind remarks that they have made. The Minister was understandably diffident in expressing the usual thanks to all members of the committee in view of the fact that he participated in the entire course of the deliberations which produced this report. Perhaps I, as chairman, can step into the breach that he has left and express my thanks to all members of the committee, present and not present, for their support and for the 652 diligence with which they studied this very interesting subject. As the Minister mentioned, I also extend my thanks to the staff, particularly Dr Kerse, without whom the report would have been a mere shadow of what we have before us today.
I think it was the noble Lord, Lord Norton of Louth, who said that he feared the noble Lord, Lord Cope of Berkeley, might feel that he was isolated in this debate. I am bound to say, having listened to his very interesting contribution, that that was far from the case. He deserves our thanks for the care with which he studied the report and the points which he made having done so.
A number of very interesting points were made in the course of this useful debate. I shall mention just two or three to sum-up the matter. The noble Baroness, Lady Goudie, mentioned the need to simplify extradition procedures. I believe that this is something which deserves a great deal more attention. It is known that some member states within the European Union do not extradite their citizens. That has a bearing on the reaction of some courts to bail. It also has a bearing on the very difficult and somewhat ill-defined and disorganised system of extra-territorial jurisdiction. In due course, Sub-Committee E may have to return to these issues. They are of very great importance and deserve to be tidied up.
I am particularly grateful to the noble Lord, Lord Wigoder, for the three points that he made in order to set the Corpus Juris project into its proper context. The question of balance is very important. It is easy to react against the proposal and to feel that in some way our system is being invaded by suggestions which are so out of keeping with our own system, but I do not believe—I do not think any members of the committee who listened to the evidence believed—that that was the right way to approach a well-intentioned, very carefully thought through and well-explained proposal. The point made by the noble Lord is absolutely right: it is a serious contribution to the debate—which is still going on—as to how to deal with a very serious problem. One is bound to approach the project against that background. Having heard the witnesses, I think we were all convinced that a great deal of serious work had been done in order to solve what everybody agreed was a remarkably difficult problem throughout the Union and beyond.
As to the point made by the noble Lord, Lord Goodhart, I share his view that if one looks at the two chapters of the report, by far the most difficult is the one which deals with procedural rules. We all know from looking at international conventions which deal with terrorism and the like that we can find ways of harmonising our substantive laws. Indeed, there are ways in which we can make progress in removing some of the technical rules about evidence— which I believe is being done, step by step—to assist prosecution across national boundaries. That kind of harmonisation, if that is the right word to use, is not in principle objectionable. The serious question of 653 procedure is in issue. The noble Lord, Lord Cope of Berkeley, said exactly the right thing: that it was really a risk of creating two systems within one which were incompatible with each other. The United Kingdom may be described, to echo a phrase which was used in connection with Hong Kong, as one country with three systems, but these are three systems which do not trespass upon each other: they work in harmony.
That brings me finally to the point made by the Minister about mutual recognition. I said in opening that I thought that we in the United Kingdom had something to contribute to this debate. As it happens, in the Appellate Committee this term we have had two cases which have raised very interesting points about mutual recognition between countries in the British Isles. The first was a case called Ellis, which dealt with the system which exists between Ireland and the United Kingdom for the backing of warrants for arrest. That is a good example of a system whereby an arrest warrant, which is a judicial decision in one country, can be enforced in the other simply by backing the warrant. It is based on a mutual confidence in each other's systems, which was precisely the point that the noble Lord was making.
654 The other case is one which has not yet reached the point of decision: a case called The Metropolitan Magistrate of Manchester ex parte Granada Television, which deals with a similar issue. That is to say, it concerned a system of search warrants between England and Scotland. There is an Act of 1881 which allows for search warrants issued by judges in each country to be endorsed in the other. These are the kinds of system with which we have lived with a great deal of success in the United Kingdom for a very long time, and they provide an example of the kind of point the Minister was making about how we can contribute to the debate in the Community.
It has been a very stimulating debate for me to listen to, and I am delighted that the Minister has been with us to join again in our discussions. I hope that our contributions, both in this debate and in the report, will help in the months ahead as we have to look further into this problem. I commend the report to the House.
§ On Question, Motion agreed to.
§ House adjourned at eight minutes before eight o'clock.