Dr Vincent Cable (Twickenham, Liberal Democrat)

I beg to move amendment No. 26, in page 8, line 22, after `overseas territory', insert

`no more than 40 days after this Act is granted Royal Assent'.

Several of the amendments proposed concern issues of substance, and I would not necessarily expect the Government to agree with them. However, this point is technical and is in the spirit of the legislation. It arises from an anomaly that is created by the status of the Isle of Man. We have a customs union agreement with the Isle of Man, so trade flows freely and we cannot exercise export controls over products exported from the mainland to the Isle of Man. However, for historical reasons, the Isle of Man has its own export licensing regime. One can immediately see the potential for anomalies to arise.

The Government would normally deal with such anomalies by bringing in an Order in Council to make the provisions of a Bill of this kind binding upon territories like the Isle of Man and we would expect them to do that. However, the process might be slow or the Government might be forgetful, so the potential exists for a substantial time lag between legislation being enacted here and its becoming operational in the Isle of Man. That is not a theoretical problem. It is a very practical one, which was revealed in an extremely embarrassing episode that took place during a previous Parliament. Hon. Members may remember the appalling events that took place in Rwanda. The popular view of the Rwandan genocide was that it was a very low-tech operation, on an appalling scale, in which enormous numbers of people were butchered with machetes. It was not fully understood at the time that the authority of the Rwandan Government was upheld by more sophisticated weaponry. That was how they controlled the country.

Some of that sophisticated weaponry originated with arms brokers, some of whom were based in this country. In one case a company called Miltec, registered in the Isle of Man, was involved in the transshipment of weapons via what was then called the Democratic Republic of Congo. That was not subject to UN arms embargoes, so it was a conduit for armaments. There is little doubt that, entirely unintentionally, this country became indirectly complicit in the Rwandan Government's activities.

To be fair to the Government of the time, that fact was recognised as extremely embarrassing, and they instituted an inquiry into the matter. An exchange that summarises the outcome of those discussions took place on 21 January 1997, when the present Deputy Speaker, the right hon. Member for Saffron Walden (Sir A. Haselhurst), put a written question to the then Mr. Malcolm Rifkind about how the problem had arisen and what lessons could be learned from it. I shall not quote the whole answer, which is quite extended, but the key points made by Mr. Rifkind, which relate to my amendment, were that the UN arms embargo with respect to Rwanda was not implemented in the Crown dependency and that there was also a delay in its implementation in the dependent territories. The time lag was crucial in providing an opportunity for the brokers to operate.

Mr. Rifkind and the Government of the time established an interdepartmental Committee to analyse the problem, and it concluded that there had been a lack of consistency in implementing embargoes in the UK, its dependent territories and the Crown dependencies. That Committee, which reported at the end of 1996, recommended specifically:

``All future binding UN arms embargoes should be applied promptly in the UK and in Crown dependencies and the dependent territories, in accordance with HMG's international obligations.'' —[Official Report, 21 January 1997; Vol. 288, c. 537.]

My amendment is intended simply to give force and urgency to that recommendation, which was not controversial. Everyone accepted that it was an entirely sensible reaction to the Miltec scandal. We have suggested that a 40-day limit should be put on bringing forward the Order in Council that would make the legislation effective in the Isle of Man. The period could be 30 or 50 days; it is the spirit of the amendment that I want the Government to understand.

Mr Rob Marris (Wolverhampton South West, Labour)

I have every sympathy with the spirit of the amendment. However, it has the potential to do the reverse of what the hon. Member for Twickenham (Dr. Cable) wants. If the 40-day deadline were missed, Her Majesty would not be able, by Order in Council, to extend the provisions.

Mr Robert Key (Salisbury, Conservative)

I entirely understand the reason for the amendment. It is important to probe the Government's thinking on the matter. I recall well the episode that the hon. Member for Twickenham described. There were enough blushes throughout Government to ensure that lessons were learned. Of course the hon. Member for Wolverhampton, South-West (Rob Marris) is right on the technical point about the amendment's having the reverse effect to the one intended.

I hope that the Minister can convince us that lessons have indeed been learned, not only in Whitehall but in the Isle of Man which, after all, has an ancient Parliament. Its parliamentarians are astute and I have no doubt that they would not want the Isle of Man to get into the same predicament again. I hope for the Minister's reassurance, but I am glad that the hon. Member for Twickenham raised the issue.

Mr Nigel Griffiths (Parliamentary Under-Secretary, Department of Trade and Industry; Edinburgh South, Labour)

I, too, am glad that the issue has been raised, and I am grateful to the hon. Member for Twickenham for doing so. My hon. Friend the Member for Wolverhampton, South-West is right in his interpretation of the Bill, in that the effect of the amendment would be to risk preventing clause 15(5) being exercised after 40 days past Royal Assent.

That is the technical reason for our rejection of the amendment. Let me seek to persuade the hon. Member for Twickenham that he should withdraw it on principle. We have received firm and detailed assurances from the Isle of Man authorities that they will be giving full effect, through Manx legislation, to all the controls made in or under the Bill, including the new controls to be imposed on arms trafficking and brokering in terms of transfers and technical assistance. That is in accordance with the 1979 Customs and Excise agreement that governs the customs union between the United Kingdom and the Isle of Man and which obliges the Isle of Man to maintain export controls parallel to those operating in the UK.

The Miltec case was mentioned and I believe that, following that case, procedures were tightened for the imposition of embargoes in the Isle of Man. In respect of the other territories, we have no reason to believe that any of them will be unable to implement similar controls by means of their own legislation. The inclusion of a permissive extent provision at clause 15(5) is therefore essentially a precautionary measure. I hope that, in the light of that explanation, the hon. Gentleman feels able to withdraw the amendment.

Dr Vincent Cable (Twickenham, Liberal Democrat)

I accept that the amendment could be counterproductive, and I would not want that. If the Government have been in contact with the Manx authorities and have had firm assurances from them that they will close this loophole, that seems perfectly adequate. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 ordered to stand part of the Bill.