Clause 2. — (Prohibition of Other Measures for Maintaining Resale Prices.)

Orders of the Day — Resale Prices Bill – in the House of Commons at 12:00 am on 12th May 1964.

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Photo of Mr William Wells Mr William Wells , Walsall North 12:00 am, 12th May 1964

I beg to move Amendment No. 9, in page 3, line 9, at the beginning to insert: Where it is established that a dealer has acted as described in paragraph (a) of subsection (1) of this section or is likely to act as described in paragraph (b) of that subsection".

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

I think that it would be convenient with this Amendment to discuss Amendment No. 10, in page 3, line 10, to leave out "a" and insert "the".

Photo of Mr William Wells Mr William Wells , Walsall North

Amendment No. 10 is a drafting Amendment, following from the Amendment that I have moved.

We seek to draw attention by means of the Amendment to the danger of any withholding of supplies being held to be unlawful, that is to say under the provisions in Clause 2, simply because of business practices which may have no connection with resale price maintenance. It is therefore important as a matter of procedure to make clear that the requirements of paragraphs (a) and (b) in subsection (1) are proved affirmatively. It is necessary to look in a little detail at the wording of subsections (1) and (3) in order to see what it is that we are seeking to achieve by this Amendment.

Subsection (1) deals with the prohibition of measures for maintaining resale prices and lays down that subject to the provisions of the Bill with regard to registration and the powers of the Restrictive Practices Court: …it shall be unlawful for any supplier to withhold supplies of any goods from a dealer seeking to obtain them for resale in the United Kingdom on the ground that the dealer—

  1. (a) has sold in the United Kingdom at a price below the resale price goods obtained, either directly or indirectly, from that supplier, or has supplied such goods, either directly or indirectly, to a third party who had done so; or
  2. (b) is likely, if the goods are supplied to him, to sell them at a price below that price, or supply them, either directly or indirectly, to a third party who would be likely to do so."
Subsection (3) starts with these words which we seek to eliminate: For the purposes of this Act a supplier of goods shall be treated as withholding supplies of goods from a dealer—
  1. (a) if he refuses to supply those goods to the dealer except at prices, or on terms or conditions as to credit, discount or other matters, which are significantly less favourable than those available to other dealers carrying on business in similar circumstances; or
  2. (b) if, although he contracts to supply the goods to the dealer, he treats him in a manner significantly less favourable than other such dealers in respect of times or methods of delivery or other matters arising in the execution of the contract.
The danger as we see it, and it is a matter of drafting—is in those initial words, the essential words: For the purposes of this Act a supplier of goods shall be treated as withholding supplies of goods from a dealer… If he does either of the things specified in paragraphs (a) or (b) of the subsection, that would be sufficient without further ado to bring him within the mischief of subsection (1). We think it desirable—and we seek to do so by this Amendment—to make it perfectly clear for the purposes of subsection (3) that the mischief arises only where in the words of our Amendment: …it is established that a dealer has acted as described in paragraph (a) of subsection (1) of this section or is likely to act as described in paragraph (b) of that subsection… The nub of the Amendment lies in the words For the purposes of this Act… This takes us not only outside the scope of the subsection, but right outside the scope of the Clause. We see danger in casting the net as wide as that. Anxious as we are to avoid loopholes—which was the purpose of our last Amendment—we are equally anxious to avoid injustices. It is with the intention of preventing what may be injustices that we have put down this Amendment.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I am sure that hon. Members are obliged to the hon. and learned Member for Walsall, North (Mr. W. Wells) for two reasons; first, for the fact that he has raised this matter at all—I entirely agree that it is our object and must be our purpose to prevent injustice—and secondly, for the customary clarity with which he has made his point. I am delighted to have the opportunity of discussing this matter for a short time. We are therefore agreed as to the objective, which is the single and rather narrow point whether this Clause, as drafted, meets the point which the hon. and learned Gentleman has in mind and avoids any kind of injustice.

First, I think I should discuss subsection (3); its object is to define the withholding of supplies to include discrimination in the terms on which the supplies are available. Its purpose, therefore, is simply to expand the meaning of withholding supplies where it is used in subsection (1). It does not in any sense have the effect of prohibiting discrimination except on the grounds mentioned in paragraphs (a) or (b). I think that this achieves the point which was made by the hon. and learned Gentleman. I understand that the purpose of the Amendment is to make clear that the prohibition of withholding of supplies, or discrimination by a supplier in the matter of supplies, operates only where such withholding or discrimination occurs on the ground that the dealer in question has been selling below the recommended price or is likely to do so. But in view of what I said in relation to subsection (3), I hope that the House—to put it in other words—will feel that subsection (1) has the effect that prohibition can apply only where the ground for withholding is that set out in paragraphs (a) or (b).

Having taken careful advice—as I am sure the hon. and learned Gentleman will appreciate—I am satisfied that the kind of injustice which he is anxious to prevent—we share his objective—does not occur in the Clause as drafted and that there is no room for misunderstanding in the matter. I hope, therefore, that the hon. and learned Gentleman will be reassured and feel able to withdraw his Amendment.

Photo of Mr William Wells Mr William Wells , Walsall North

I should have felt happier had the form of words which we suggest be adopted. I am sure that the Minister has taken careful advice. We respect the sources of that advice even though they are not always infallible. In view of what the Minister has said, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I beg to move Amendment No. 11, in page 3, line 10, at the end to insert: (a) if he refuses or fails to supply those goods to the order of the dealer. I do not think that I need detain the House very long on this matter, as it was discussed very clearly—and, as I hope the hon. and learned Member for Edge Hill (Mr. A. J. Irvine) would think, fully—in Committee. I say that because I am happy to acknowledge that the fact that this Amendment now appears in the Notice Paper is due entirely to the hon. and learned Gentleman's prompting and to the careful work that he has been good enough to devote to this Bill. In Committee, he tabled an Amendment similar to this one, and he will recall that we then accepted the principle of his Amendment and undertook to put down our own Amendment later to deal with the point.

First, then, the tabling of this Amendment is in fulfilment of an obligation that I was responsible, on my right hon. Friend the Secretary of State's instructions, for undertaking in Committee. The object of the Amendment is to make clear that the purpose in subsection (3) is to prohibit the enforcement of resale price maintenance either by outright refusal to supply as well as by refusal to supply except on discriminatory terms. I am sure that this Amendment improves the Bill, and again I acknowledge with gratitude the help we received in Committee from the hon. and learned Member.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

I am grateful to the hon. Gentleman for his words. It is always rather satisfactory in proceedings either in the House or in Committee when a point that an hon. Member thinks is valid is acknowledged by those opposite to him. I had no doubt, and I do not think that the hon. Gentleman had, that there was substance in my criticism of the original drafting. Any difficulty deriving from that is now removed, and I welcome the Amendment.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I find myself quite unable to welcome what is, in fact, the Amendment of my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine). I repeat that I feel it to be an outrage that a man should be compelled, against his will, to supply goods to a man who has proved himself untrustworthy, and of whose methods of dealing and behaviour he disapproves. I have never really taken any objection to Clause 1. I do not think that resale price maintenance—which is not illegal, and which is not made illegal by this Measure but merely made unenforceable by the courts—ever could have effectively been enforced by the courts, and that efforts to do so were generally misguided.

I think that people who go to the courts to enforce their contracts are generally misguided. My advice on matters of this sort is the advice I drew from my Quaker ancestors: If thy fiend deceive thee once, blame him; If he deceives thee twice, blame thyself. That is the way businessmen should be guided, and when I find introduced into a Bill by an Amendment such as this a provision that compels a man to be deceived twice, it outrages my sense of justice.

Let us be quite clear about one thing. An agreement to resell at a certain price is a freely negotiated agreement. It is one that honourable men will observe. The price-cutting people are dishonourable traders, and to compel a man to go on dealing with them is a moral outrage. I have said this before, and I repeat it now.

8.15 p.m.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

Some of us are in some difficulty. Like my hon. and learned Friend the Member for Northampton (Mr. Paget), I find it irksome to disagree with our own Front Bench but equally irksome to agree with the Government Front Bench on this Measure. Being in this difficulty, I would rather emphasise my disagreement with the Government. Front Bench than my unhappy inability to achieve unanimity with my own.

I do not like this Amendment. I do not like it for the reasons that have been effectively and firmly put forward by my hon. and learned Friend the Member for Northampton tonight and on previous occasions and also because, yet again, we get evidence of the haste, lack of precision and indifference to well-established legal principle that is to be found all over the Bill and the Amendments in this "hotch-potch", as it has rightly been described to be.

After we have discounted the very courteous and reasonable manner of the Minister—it contrasts, sometimes, with the rather touchy manner of the Secretary of State—and come to the meat, we are asked to approve an Amendment—and I hope I have it aright; I missed a moment or two at the beginning of this debate dealing with the position when it is established that a dealer has acted as described in paragraphs (a) or (b). If that is to be incorporated in the law of the land, as I understand is to be the case—and I hope that I may be corrected here if I am wrong—I find it difficult to believe my eyes and ears—

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

Perhaps the hon. Gentleman will allow me to assist him. His remarks are, in fact, being addressed to the last Amendment, of which the House has disposed, and not to that currently before hon. Members.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

I did apologise—I was detained in the Lobby and missed the opening of this debate. I am very much obliged to the Minister who, with his usual courtesy, makes it clear that Amendment No. 9 has been disposed of—that it has not been accepted—

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

And I am relieved, although it has not disposed of the difficulty of my hon. and learned Friend the Member for Northampton (Mr. Paget).

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

I am obliged to the Minister for putting me right on this point, on which I shall not address any further remarks to the House.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

I must join issue on this Amendment. If I thought that the Government intended to accept our Amendment No. 15, in page 3, line 20, at end insert: (4) Nothing in this section shall make it unlawful for a supplier to withhold goods from any dealer to whom he has not previously sold goods or who refuses or fails to comply with a requirement by the supplier that he shall pay cash or the equivalent of cash on order. I should feel much happier. If they do not intend to accept it, it means that a supplier is compelled to supply a new customer with goods, whether he likes to do so or not. That is totally wrong, and utterly and entirely un-British. It is wrong from a business point of view.

When we last discussed this matter the Minister said, in effect, that he realised the position of a man who sought to contract with the supplier for the first time and that if a supplier would not contract because he was short of the goods that would be a reasonable excuse. But there is nothing in the Amendment or in the Bill which makes that a reasonable excuse and which incorporates a means of escape for the supplier who has not the goods to supply to a man who might come to him out of the blue, and say, "I want the goods from you. Here is the money for them and by law you must supply me." [HON. MEMBERS: "No."] That is how I interpret the Bill. If I am wrong I am ready to be corrected. I can see no provision at all in the Clause or in the Amendment to meet the reasonable difficulties of trade which the supplier might experience.

I know that the Minister has made provision for the cash and credit basis, but I am not dealing with that aspect.

I am dealing simply with the supply of goods. A man who has never been a trader before and who may be living on the fringe of a housing estate where regulations govern those parts of the estate which is a shopping area where the inhabitants may purchase their goods, may go from a private house to a wholesaler and say, "Here is the money. I want a supply of your goods", and under the Bill he cannot be refused.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

It is certainly true that if he announced the intention of cutting prices the presumption would be that if the supplier had not supplied him he had not done so on that ground.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

Whether he is cutting prices or not, the supplier must supply him with goods for resale to the public.

Photo of Mr Graham Page Mr Graham Page , Crosby

I do not see how the hon. Member gets that out of the Amendment, which says only that if a supplier refuses to supply the goods he has withheld them. That is all that the Amendment says, not even that he has withheld them unlawfully.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

I am dealing only with a man who is a first customer, and that is why I have referred to Amendment No. 15, which makes clear that we do not want the accusation of withholding goods to apply to the supplier who is called upon to supply to a man for the first time. If the Government are prepared to accept that Amendment I am prepared to accept the Clause without further argument, but as the Clause stands a man who tries to contract with a supplier for the first time, with no recommendation or reference, provided that he pays cash, must be supplied with goods for resale to the public, according to a future Amendment to be moved by the Government. Perhaps the Minister of State, Board of Trade, will correct me if I am wrong.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

My hon. Friend is not wrong. That is the whole purpose of the Clause.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

I hope that the Minister of State can tell me whether these provisions apply to a man who is approached for the first time to supply these goods.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

The hon. Gentleman requests me to interrupt him briefly. It was not my purpose to speak again, because we are directing our attention to a limited Amendment. I think the hon. Gentleman has forgotten some of our earlier discussion in Committee in relation to these matters, and I ask him to look possibly at a later Amendment, No. 14, to recall the earlier discussion and, indeed, to see precisely what Clause 2 endeavours to do. The rubric to that Clause states that it is a Prohibition of other measures for maintaining resale prices. In fact, the whole Clause is directed towards price cutters. Obviously there may be other legitimate reasons why suppliers should wish to withhold supplies. I thought this was well within the understanding of the House.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

When I raised this matter in Committee I received from the Minister an assurance that there would be incorporated in the Bill an Amendment which would make it clear that even under Amendment No. supplies to a new customer on the ground, for instance, of shortage of stock. When I look at Amendment No. 14, what does it say?

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

Order. I am sorry, but we cannot discuss Amendment No. 14 until we reach it.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

I am sorry that I cannot discuss that Amendment. In no future Amendment can the Minister of State show me any escape route for the wholesaler who wants to refuse supplies to a new customer. Even in Amendments that have already been discussed in Committee, and in any future Amendments which may be contemplated, there is nothing which specifically exonerates the supplier of goods for supplying to a new customer for the first time if the customer pays him cash. If that person is prepared to pay for the goods, he can, under the terms of every Amendment to Clause 3, demand supplies from the wholesaler or the manufacturer.

I challenge the Minister of State on this point. I want to make it perfectly clear that a wholesaler could withhold 14, which I cannot discuss at the moment, there is no specific provision which makes clear that the dealer can escape from the challenge of a new customer who may be transferring his affections from a previous wholesaler, perhaps because of certain difficulties, and who by transferring to the new wholesaler may involve him in similar difficulties. There is no safeguard to the wholesaler under the terms of any provision of this Bill or of any Amendments yet to come.

8.30 p.m.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

May I, by leave of the House, speak again on this matter?

The Government have put forward an Amendment which the Minister was good enough to say derived from recommendations I had previously advanced. I welcomed This Amendment but, subsequently, much to my surprise, I found that it was strongly criticised by my hon. and learned Friend the Member for Northampton (Mr. Paget) and my hon. Friend the Member for Sheffield, Bright-side (Mr. Winterbottom), fortified by another of my hon. Friends, albeit that he was speaking to another Amendment.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

I desire to make quite clear, therefore, why we originally wanted this change and why we welcomed it, although I am well aware that the reasoning which prevailed with us is well understood by my hon. and learned Friend and my other hon. Friends. The point is that we are dealing here with withholding, not with unlawful withholding. As regards the issues raised by the concept of unlawful withholding, we have one recommendation after another to offer to the House, as we had in Committee. I agree very much with my hon. Friends in the view which they have indicated towards the matter of unlawful withholding.

What we were confronted with in the original drafting of subsection (3) was a defining of "withholding", but the definition failed to comprise the most obvious case of withholding of all, namely, the occasion when supplies were simply cut off. We thought it right to draw attention to this defect. I am sure that my hon. Friends will agree that it would be foolish to provide in the Bill that it was a withholding to and on terms and conditions specified refuse to supply goods except at prices and not a withholding to refuse simply to supply the goods. No reasonsable hon. Member could possibly argue for such a proposition as that.

It was to meet that unanswerable point that the Government put the Amendment down. I am bound to say that nothing I have heard has altered my disposition to welcome it.

Amendment agreed to.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I beg to move Amendment No. 12, in page 3, line 14, to leave out "available" and to insert: at or on which he normally supplies those goods". Would it be convenient, Mr. Deputy-Speaker, if we discussed this Amendment and Amendment No. 13, in page 3, line 18, after "than" to insert that in which he normally treats at the same time? They run together, and we did have a discussion on them together in Committee.

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

Yes, if that is agreeable to the House.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

We have tabled these Amendments to fulfil an undertaking which I was responsible for giving in Committee, again on the instructions of the Secretary of State. Their whole purpose is to clarify the provisions of Clause 2(3,a) and (3,b). The need for this clarification was brought to our attention by Amendments put down in Committee by my hon. Friend the Member for Bath (Sir J. Pitman) but not in fact moved at that stage. However, my hon. Friend made certain references to them when speaking on the Question, "That the Clause stand part of the Bill." In the light of the examination of the Amendments which we made at the time and the views expressed by my hon. Friend, my right hon. Friend felt that there was substance in the point that the Clause as originally drafted contained a defect of ambiguity.

As regards the first case, that defined in paragraph (a), we felt that it might not be entirely clear that the comparison was with terms available from the supplier concerned and not with those which dealers might be able to get from other suppliers. The first Amendment puts that point beyond doubt.

In both cases, the Amendments also make clear that the comparable terms are those on which the supplier concerned normally does business; in other words, no account will be taken of terms only exceptionally available. I hope that the House will feel that these Amendments improve the Bill. That is certainly our opinion. I should like again to acknowledge the help and assistance which we derived from my hon. Friend the Member for Bath. We are grateful to him for drawing these matters to our attention.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

Our inclination is to welcome the Amendment. We think that it is right. As the Minister readily acknowledged, it is not a drafting Amendment. It has quite important consequences, and it reduces the mischief of the Clause.

As the Clause was originally drafted, it was concerned with conditions significantly less favourable than those available to other dealers offered by any supplier. That was how we read it and how it was correctly construed, I think. That might well have had unfortunate results. Now, as I say, the mischief of the Clause is diminished, and the test applied is the standard of practice of the supplier in question. This seems to us an improvement, and we welcome it.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

I, too, welcome the Amendment as far as it goes. It can be succinctly said that it makes the Clause go from worse to bad, and therefore, if one is to assess the relative merits of the Clause, one must say that the Amendment is an improvement. The Clause would be worse without it. It is bad with the Amendment, but without it it would be very bad.

It is worth underlining the haste with which the Government botched the Clause together and threw it before the House. Originally, the Clause obliged a man, on pain of being sued for every penny that he had, to supply goods to practically anybody, especially to a price-cutter, who is placed in a more favourable position in this Bill compared with anybody else. Presumptions are raised in his favour which would not be raised for anybody else. Without this Amendment, the Clause would oblige a man to supply a price-cutter, on pain of being sued for limited sums of damages, on terms as favourable as those on which anybody in the business is supplying anybody else in the business.

May I put it in this way. Suppose that a manufacturer carrying on a perfectly reputable business is approached by one of the seediest and shadiest men in the trade who wants supplies from him. Having carefully announced that he is a price-cutter, and having raised in his favour the presumptions which can be especially raised in favour of price-cutters by this Bill, he would, under the Clause if it were unamended, demand that he be given the same terms, on which the manufacturer in question was supplying to anybody but on which some other manufacturer was supplying to I.C.I., for example. This seedy, shady individual could say, if the Clause were unamended, "I know that you have never supplied anybody on these terms, but Smith supplies I.C.I. on these terms and I want them". The Bill as it passed through its Second Reading and Committee stages actually enacted that. This was the outrageous nonsense which the Secretary of State had managed to push through the House up to the Report stage.

Now the Clause is significantly better. As I say, it has gone from worse to bad, but it must not be thought that the Amendment cures the mischief and fundamental evil of the Clause. It at least says that a man cannot go to a manufacturer and say, "You must supply me, not on the terms on which you are supplying I.C.I., but on the terms on which somebody else is supplying I.C.I." Before he can get an action for damages on its feet, he is obliged to assert that the manufacturer is supplying somebody as reputable as and substantial as I.C.I. on these terms and that he wants them. I hope that hon. Members opposite will agree with me. I have not been hesitant in saying that they have played a very courageous and praiseworthy part in improving the Bill to conform more to my taste and in mitigating some of its evils.

Everybody will say that if he does not get the goods it is a case of withholding, and not necessarily unlawful withholding. I accept that. All that happens is that there is a prima facie case for damages against me if I, the manufacturer, refuse to supply. Unless I prove the contrary, at great expense and risk to myself, unless I prove that I had other good reasons for not supply- ing the man, it is assumed against me that I have refused to supply him because he is not a price-cutter.

Incidentally, I have the first ingredients of withholding if I do not offer him as good terms as other regular customers are getting who have been trading with me for a long time. I am placed in peril if I do not give some seedy intruder as good terms. That will be the position even with the Amendment. What is worse is that not merely must I give him as good terms as I give to other people. The mischief which will still remain after the Amendment is made, apart from the mischiefs which I have mentioned, is that characteristically, as in many other points of the Bill, its penal and damaging provisions are of a vague and ill-defined nature. Here again, there is the same hasty, ill-defined disregard for people's rights. A man's rights depend not merely upon what the lawyers or the courts say after they have been argued about. A man's rights depend upon what he understands his rights to be.

If a man is led to believe that he would be ruined if he does not supply a shady individual, his rights have been effectively taken away from him even though, if he had the courage to litigate the whole matter and risk being ruined, he might have had a triumphant action out of it. Therefore, we should not seriously interfere with people's business and expose them to unlimited claims for damages. We should define with great terms of precision the terms on which the liability arises.

The Amendment does not add to the precision of that. Subsection (3,b) of the Clause states: although he contracts to supply the goods to the dealer, he treats him in a manner significantly less favourable than other such dealers in respect of times or methods of delivery or other matters arising in the execution of the contract. In anything to do with the execution of the contract, therefore, the supplier must not treat the dealer significantly less favourably than he treats his other customers.

What does that mean? Does that mean if the supplier's other customers are treated with great courtesy, given a cup of tea and a seat while they wait and their invoice is being written out, the treatment would be held to be signifi- cantly different if someone else were made unwelcome, treated in a surly and snappy fashion and told to wait outside in the rain?

Is it significant if a supplier says to a customer whom he does not want, but whom the Government force him to accept, "Get to hell outside; I am obliged to serve you, but I do not like anything about you, your smell or your business methods"? The manufacturer might, not unreasonably, be inclined to say that. We have had compulsory loans in the dark days of our history, but we never before had compulsory customers or were obliged to supply people whom we detested. The more detestable these people are, the better their claims for damages afterwards. So it is enacted in the Bill.

Will the Amendment cure this evil of the Clause that a man may be accused of treating a customer significantly less favourably if he tells him to wait outside in the rain compared with the man who is not breaking his promise at every favourable opportunity and who is invited to sit in a chair, treated with courtesy and given a cup of tea?

8.45 p.m.

I should like to know, what does it mean? If I am a manufacturer I want to know what it means. How far can I express my dislike of this customer the Government are forcing upon me without being sued for damages? How far do I have to be well-mannered towards him? Do I have to call him sir? If I do not, am I treating him significantly differently? We ought to have some clarification of all this.

It is true that the ludicrous wideness of the Clause, so evil, so unthinkable in its drafting as it originally stood, and as it stands at this moment, till the House amends it—it is true that the mischief of that will be reduced, as I at once concede. Therefore, I shall not oppose the Amendment, but I think that the House ought to be in no doubt that it remains a wicked Clause, a Clause with evil effects, which brings unprecedented novelties into our commercial life. It does so in language which is so vague, ill-defined and dangerous that it makes me doubly apprehensive of the functioning and the purpose of the Bill and the Clause.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I find myself in considerable agreement with my hon. Friend the Member for Manchester, Cheetham (Mr. H. Lever) when he says that these Amendments make a bad Bill less bad. I recognise that in that sense they are an improvement, but, none the less, I think that this Clause probably will still be the worst Clause on the Statute Book. Really, this sort of doctrinaire pursuit of the idea that unlimited competition designed to compel the strong to drive out the weak is really going ultimately to produce lower prices for the weakest chap of all, who is the customer, seems to me to be an odd delusion in any terms other than the extremely doctrinaire ideas of the Liberal Party which now seems to have passed on to what was once the Tory Party's Front Bench. I thought that that sort of idea had been rejected by almost everybody but when I see that kind of idea being enforced by a Bill—

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

Order. I am sorry to interrupt the hon. and learned Member, but I think he is getting a little wide of the Amendment. Perhaps he can explain to me how he is relating his remarks to it.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I entirely agree, Mr. Deputy-Speaker. My observations were introductory. Now I will try to straighten them out to meet the point.

I was trying to say that I thought the general objective pretty poor, but when by this Clause it is sought to achieve that object by placing a premium on dishonest conduct over honest conduct I think that the limits of bad legislation are about being reached, because what this Bill does is to prefer the man who has behaved dishonourably—

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

I am sorry, but the hon. and learned Member, despite his saying that he agreed with me, seems to me to be carrying on just as before. Could he really direct his remarks to the Amendment?

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

With great respect, Mr. Deputy-Speaker, what this is saying here is that the supplier shall be compelled to deal on his best terms—on what, in international trade, is the most favoured nation treatment—with a dealer merely because that supplier can establish that the dealer has broken his word with regard to resale price maintenance on previous occasions.

That seems to be an extremely bad thing to do. It not only places a premium on dishonesty so far as the customer is concerned. It also places a premium on dishonesty so far as the supplier is concerned. If the supplier gives the true reason, which is "I do not like the way you deal. I do not like dealing with people who are not men of their word", then he can be sued, but if he thinks up any other reason under the sun and tells a lie he cannot be sued.

To create an instrument of this sort, which is designed to favour the least honourable people on both sides of the deal, seems to me to offend against every idea of probity in business. This seems to undercut every conception we have that business dealings should be by men of their word who tell the truth. Here the advantage is given to people who are not men of their word and do not tell the truth.

This is a very bad Bill, and we ought to recognise that this improvement is a very slight one.

Amendment agreed to.

Further Amendment made: In page 3, line 18, after "than", insert: that in which he normally treats".—[Mr. du Cann.]

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I beg to move Amendment No. 14, in page 3, line 20, at the end to insert: (4) For the purposes of this Act a supplier shall not be treated as withholding supplies of goods on any such ground as is mentioned in subsection (1) of this section if, in addition to that ground, he has other grounds which, standing alone, would have led him to withhold those supplies. If I night first rise to a point of order, Mr. Deputy-Speaker, the right hon. Member for Battersea, North (Mr. Jay) made the point that it might perhaps be not entirely convenient for the House if Amendment No. 15 were discussed with this one. I think it is proposed that they should be discussed together, but I wonder if I might make a suggestion which might assist the right hon. Gentleman and the House. I hope I have not misunderstood the position.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

Further to the point of order, Mr. Deputy-Speaker. I thought from what you said a moment ago that we were taking these two Amendments separately.

Photo of Mr Robert Grimston Mr Robert Grimston , Westbury

I understand that the original intention was that they should be discussed together but that the right hon. Member for Battersea, North (Mr. Jay) preferred that they should be taken separately, and Mr. Speaker agreed that that should be done.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I beg your pardon, Mr. Deputy-Speaker. I had not understood that. That is why I was rising to make a suggestion which I hoped would be helpful and meet the position. If we are dealing with this Amendment on its own, then the matter is dealt with. I will deal with this Amendment as rapidly as I can so that we can proceed with Amendment No. 15, in which I know right hon. and hon. Members opposite are interested.

The Amendment deals with what I might call the mixed motive point. It will add a new subsection to Clause 2. The Clause makes it unlawful for suppliers to withhold goods from dealers or discriminate against dealers who do not observe recommended resale prices. The object of the Amendment is to clarify the position of a supplier who withholds supplies or discriminates for mixed motives; that is to say, both because the dealer is not observing recommended resale prices and for other reasons. I will be a little more specific about other reasons in a moment.

The new subsection makes it clear that such a supplier shall not be regarded as acting unlawfully if he would have withheld supplies or discriminated for other reasons unconnected with resale price maintenance. It will be within the recollection of the House that we had a very substantial discussion in Committee. I remember in particular speeches by my hon. Friends the Members for Crosby (Mr. Graham Page), Buckinghamshire, South (Mr. Ronald Bell) and Twickenham (Mr. Gresham Cooke)—all three of whom I am pleased to see present—my hon. Friend the Member for Bedfordshire, South (Mr. Cole) and my right hon. Friend the Member for Thirsk and Malton (Mr. Turton). I also remember a speech on the same subject by the hon. Member for Manchester, Cheetham (Mr. H. Lever), who has again honoured us with his presence this evening.

We had a substantial discussion about this point. Our attention was drawn to the position of the supplier who may withhold supplies for a number of legitimate reasons of ordinary commercial practice. Perhaps I may give one specific example. The case was mentioned of the supplier who withholds supplies from the dealer because he knows the dealer to be insolvent and also because the dealer is selling goods below the recommended resale price. The position will be, if the House sees fit to accept the Amendment, that it will be clear henceforth that where there are other reasons which, standing alone, would have led the supplier to withhold supplies, the withholding will not be unlawful.

This is, I hope, the exact fulfilment of the undertaking given in Committee to my hon. and right hon. Friends and others both by the Secretary of State and myself that we would deal with the matter. I hope that the House thinks that right and that the hon. Member for Sheffield, Brightside (Mr. Winterbottom), to whose intervention on the last Amendment I listened with great interest but with which I am bound to say I very largely disagreed, will feel that we are attempting here to meet some of the dangers which I know he has very much in mind from his deep experience of these matters.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

It was my intention to put a question to the Minister on a subject which puzzled me. I think that the Government are right to deal with the matter of mixed motives. That will be a very common event, and it is right that the situation should be dealt with.

The difficulty which I am in, speaking for myself, is that I cannot see why, where there are mixed motives, the determining consideration should not be which is the paramount motive amongst many—one among many. If in the context of mixed motives there is one motive which is paramount, it does not at all follow from that situation that standing alone it would have been sufficient to convince the supplier to behave in a certain fashion. In other words, the matter of paramountcy can surely be tested without going to the point to which the Government's proposal goes of requiring that a motive which may be a paramount motive has the effect of which the Minister speaks when standing alone.

My right hon. Friends and I would like to know what is the Government's purpose. Why is it necessary to introduce this proper concept of paramountcy to deal only with the case of a motive which has the particular effect when it is standing alone?

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

In a sense I am sorry that we are not discussing Amendment No. 15 with this Amendment because I could have asked for clarification of Amendment 15, which is passive, whereas this Amendment is nebulous. The Amendment says …if, in addition to that ground, he has other grounds which, standing alone, would have led him to withhold those supplies. What does that mean? It means that when the case comes to a Restrictive Practices Court, the judge will have to decide whether those grounds are good and sufficient. The judge will have only one positive assertion to guide him: if he refuses or fails to supply those goods to the order of the dealer". In court, one cannot argue what was said in Committee or in the House by the Secretary of State or the Minister of State.

Photo of Mr Robin Maxwell-Hyslop Mr Robin Maxwell-Hyslop , Tiverton

How does the Restrictive Trade Practices Court come into this?

9.0 p.m.

Photo of Mr Richard Winterbottom Mr Richard Winterbottom , Sheffield, Brightside

I am speaking of the judgment. I am saying that this provision is nebulous and that what we want is something positive to give a clear lead to protect the wholesaler. No doubt the Amendment conforms to promises made in Committee, but it is nebulous and something much more positive is required. We should have provisions for the protection of the supplier, manufacturer or wholesaler, clearly defined. He should have positive protection in this Clause in the same way that there is a positive provision about the withholding of supplies. I wish that Amendment No. 15 had been taken with Amendment No. 14, because in Amendment No. 15 we would have had something to protect the wholesaler instead of this nebulous uncertainty which may finally have to be resolved by someone outside the House.

Photo of Mr Angus Maude Mr Angus Maude , Stratford-on-Avon

Like the hon. Member for Sheffield, Brightside (Mr. Winterbottom), I also very much regret that the Opposition Front Bench interfered with the Chair's original grouping which put Amendments Nos. 14 and 15 together. Taking them separately will make it extraordinarily difficult to get a comprehensive discussion of the points which many of us wish to meet. Amendment No. 15 goes too far, while Amendment No. 14 goes scarcely far enough. If we had discussed them together, it might have been possible to have arrived at some clear understanding of the way in which we could fairly and satisfactorily meet this problem.

What seems to be a possible deficiency of the Government Amendment—and I should like some reassurance about this—is that it does not quite meet the case of the supplier who has never before done business with a distributor and who is blackmailed into supplying him by the threat of having to take legal action in order to prove that it is not because the distributor is a price-cutter, or a suspected price-cutter, that the supplier is not supplying him. I agree that it is very difficult to make a black and white division between those whom one has supplied before and those whom one has not. This increases rather than reduces the difficulty for the simple reason that it would enable a supplier to refuse supplies to a new distributor without inviting proceedings under the Clause as it would have been amended. This must be wrong, because it would enable the supplier to take steps to prevent the introduction of new distributors, who might be more modern and more competitive in every way, into the trade. I think that it must be wrong to go as far as that, but surely there must be some half-way house in which we can deal with the things which are obviously worrying hon. Members on both sides of the House.

I think that it is a justifiable complaint—and many suppliers have put this—that it is putting them in grave jeopardy and to great expense and trouble if they can be almost blackmailed by a distributor with whom they have never done business, simply on the ground that they might be judged to have been motivated by the fact that the chap was a price cutter, or a possible price cutter.

I am not clear—though I am open to persuasion on this—that the Amendment wholly meets that point. It is true that the supplier might be able to say to the Court that the reasons why he had not previously supplied a distributor were good and sufficient reasons which, standing on their own, were conclusive. But, on the other hand, it may be that he had not previously supplied that distributor, for the simple reason that he had never heard of him, or that the distributor had never placed an order with him or asked to be supplied, and had he previously placed an order with him and asked to become a distributor, the supplier might have perfectly good and proper reasons for deciding that he did not want to deal with him.

It seems to me now that when he is approached for the first time after the passage of the Bill he will be in a very nebulous position indeed, because the Amendment does not wholly protect him against what might be a thinly disguised form of blackmail. I feel that the Amendment which is to be taken next goes too far in this respect, but I hope that the Government will consider whether it is possible to go a little further than this Amendment goes, or, if I am wrong in my belief that what they are seeking to introduce is inadequate, that they will be able to convince me that that is so.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

My hon. Friend the Member for Sheffield, Brightside (Mr. Winterbottom) said that this was a rather nebulous Amendment. I disagree with him. I believe that it is a most important Amendment, and that if it is accepted it will have the effect of making Clause 2 almost completely worthless, because if a supplier is really anxious to continue some form of price fixing of his commodity to retailers, and anxious to stymie the activities of the firms which he suspects are going to price-cut, or who have had price cuts on his goods, it will be easy for him to find some other reason for withholding supplies.

If I read the Amendment correctly, the onus seems to be on the supplier.

If he has other grounds which, standing alone, would have led him to withhold his supplies, it is the supplier who makes the decision. If the supplier in his own judgment determines that there are just reasons why he should withhold the supplies, he can make up those reasons.

Let me give the House a few examples. Consider the example of a supplier of a Shampoo Master who expects retailers to have a mark-up of 87½ per cent. He is unhappy because a supermarket has obtained Shampoo Masters and is selling them at a mark-up of 25 per cent. He then makes a policy decision to the effect that he wants his Shampoo Master to be sold only by hardware dealers who sell the particular brand of detergent that goes with his machine. This is a policy decision, and he would make it—he would say—in order to protect the service that goes with the product that he supplies. It is his decision, and it is a policy decision.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

My hon. Friend asks why he should not do so. If he can do that, the Clause is absolutely worthless. It means that an individual who intends to price-cut can have his supplies withdrawn, as a result of a policy decision which is really an excuse invented by the supplier in order to withhold supplies.

This is a very important Amendment. If it is accepted it will be possible for any supplier to find reasons why he should not supply goods. A supplier of a well-known brand of shirt, such as Rael-Brook or Tern—which is sold with a 100 per cent. mark up—may decide that he does not like the activities of a supermarket which sells his shirts at a mark-up of only 25 per cent. He therefore decides to sell only to shops which stock a wide range of men's wear, including ties, socks and the rest, thereby making a policy decision and withholding supplies from a shop which makes a quick turnover because it sells only shirts.

If suppliers can invent excuses of that kind the whole Clause becomes completely worthless. Furthermore, as the whole Bill depends upon the effective- ness of the Clause—hon. Members will remember what Professor Yamey said about the importance of the withholding of supplies point—the Bill in turn will become worthless, if—and I agree that it is a big "if"—supplies and manufacturers who want to maintain r.p.m. use their powers under the Bill as they will be able to use them if the Amendment is accepted. My hon. Friend may think that this is a nebulous Amendment. I invite him to read it again. It is a far-reaching Amendment.

We must also consider the case of the co-operative societies, which have had supplies denied to them because suppliers or dealers suspect that under their dividend arrangements with their own members they are engaging in some sort of price cutting, whereas they have profit sharing arrangements with their members. Under the Bill as originally drafted a co-operative society could insist on obtaining supplies. That was extremely good. Why should co-operative societies, which provide mutual services for consumers, be denied supplies? If the Amendment is accepted, a firm can make a policy decision not to supply mutual societies or co-operative societies, or mail order firms.

If it is accepted it will be possible for the recommended price to be the effectively imposed price, because supplies can be withdrawn if the price is not maintained. Hon. Members who have studied Professor Yamey's work on this matter—and he is the expert in the business of r.p.m.—will remember that his key point is that unless it is made impossible for dealers to withhold supplies in the event of price cutting, all the legislation in the world directed against the imposition of r.p.m. will be worthless. I submit that this Amendment, if accepted, would weaken, or almost completely destroy, the provisions of Clause 2 from the point of view of larger manufacturers determined to take advantage of them. It would therefore make the Bill worthless, and I ask that the House give this matter serious consideration.

9.15 p.m.

Photo of Mr Graham Page Mr Graham Page , Crosby

The hon. Member for Wednesbury (Mr. Stonehouse) seemed to desire to control the business of suppliers rather than to attack resale price maintenance as one aspect of trading. All this Bill does is to deal with resale price maintenance as an aspect of trading. It does not attack the whole business of supplies from the wholesaler to the dealer. I am grateful to my right hon. Friend for introducing this subsection in response to an undertaking to look again at the points which were raised during the Committee stage discussions.

I consider this a wise and proper Amendment. The position was that if a supplier quite honestly said, "I do not want to supply this dealer because I know that he has been price-cutting", but there were many other reasons why the supplier did not wish to supply a dealer—many proper business reasons—had the Bill remained as drafted there would have been a doubt whether merely saying that price cutting was a reason would have laid the supplier open to a charge of unlawful withholding. There may be many other very good reasons of which one has been mentioned, the financial instability of a dealer. That comes up under another Amendment—

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

It is nothing to do with good reasons, it is any reason which the supplier thinks is a good reason.

Photo of Mr Graham Page Mr Graham Page , Crosby

The supplier has to justify his reason, and it may be challenged in the courts. If he has a reason which stands alone, if he has a genuine reason, he has to prove it in full.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

The Amendment says, …which, standing alone, would have led him to withhold those supplies. It is not a question of a reasonable man or an upright man, or having to do with good reasons.

Photo of Mr Graham Page Mr Graham Page , Crosby

He has to satisfy the court that, in fact, it has led him to that decision. If a supplier has said that because a dealer was price-cutting, and only because of that, he refused to supply the dealer, he would be perjuring himself and not satisfying the Court that it was true—

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

He does not have to show his perjury or anything of the sort. Suppose a supplier says that he does not want to supply a dealer because he does not like Jews. That is a perfectly good reason, and if he could convince the Court that he was sufficiently anti-Semitic he would succeed.

Photo of Mr Graham Page Mr Graham Page , Crosby

If he could satisfy the Court that, in the words of the Amendment, it led him to withhold those supplies why not? He used that reason. There are other commercial reasons—

Hon. Members:

No.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

There is nothing about commercial reasons—

Photo of Sir Harry Hylton-Foster Sir Harry Hylton-Foster , Cities of London and Westminster

Order. I think it desirable that only one hon. Member should speak at a time and that none should speak from a sitting posture. Mr. Page.

Photo of Mr Graham Page Mr Graham Page , Crosby

I am obliged to you, Mr. Speaker. May I detail the sort of reasons which I have in mind which are most likely to come in question in connection with this matter? There might be an insufficient market. The dealer might be ordering in too small quantities to make it economic for the supplier to supply him. There may be transport difficulties. There may be bad storage facilities at the premises of the dealer so that the goods would be in a bad condition when sold and the supplier would get a bad reputation in respect of his goods. Those are the sort of commercial considerations which, if they really led a supplier to withhold goods, we should make permissible.

The words, "standing alone" may raise some difficulty. I hope that I shall not trespass an the provisions of another Amendment, but suppose a supplier says to a dealer, "You have been price-cutting and for that reason I think that you are going 'bust'—you are ruining yourself by doing so. You are not creditworthy and therefore, because I think that you are not creditworthy, I shall refuse to supply goods to you." I am not concerned whether that would be standing alone under this section. It is probably as a result of price-cutting and might not come in as a separate ground in the proposed Amendment. Perhaps my hon. Friend would deal with that point, if to do so would not be going too far outside the terms of the Amendment.

The hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) raised the problem of paramountcy. It is difficult enough for the Court to discover a genuine motive—I think that the Court has to discover a genuine motive despite what hon. Members opposite have been saying—without putting the rather impracticable task on the Court of discovering the paramount motive. If there is a motive which has led the man to refuse supplies other than the fact that the dealer was price-cutting, then he should be able to come within this Amendment and not suffer the penalties of unlawful withholding.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

The discussion of this Amendment illustrates the extraordinary difficulty we get into when we try to legislate that people shall trade against their will. The problem is difficult enough already; and I must say to the Minister that if we tried to discuss together this Amendment, which is wholly concerned with motive, and the next Amendment, which is concerned with the question of whether a person should be compelled to trade with people with whom he has never traded before, I think that the confusion would have been even worse. I hope that I am right in that.

The Government have at least tried to improve the situation as compared with the previous state of the Bill, but I am not absolutely certain that they have succeeded. As the Bill was first introduced, a man was held to be unlawfully withholding supplies if he acted on the ground that the dealer had reduced prices below the recommended price. I do not like the phrase "price-cutting" because it suggests that there is something dishonourable or discreditable in reducing prices. I do not think that it is morally, legally or in other sense more discreditable to reduce prices than to raise them. What we are talking about is selling below the recommended price. Therefore, the question arose: "Was he acting on those grounds if he both had this motive and certain other motives?"

The Minister has tried to meet that by saying that he is not acting on that ground, if, in addition, the man had other motives which would by themselves have induced him to withhold supplies. This illustrates the point to which we have now got. The supplier, first, has to prove his case—the onus of proof is on him—secondly, he has to prove his motive—the state of his mind—and, thirdly, he has now to prove what his motive would have been had the circumstances been other than what they were. I am not saying that this is an absolutely impossible proposition—I am not a lawyer—but it illustrates the point to which we have been led. I still have serious doubts whether this is really the best solution.

I should like to put two other questions to the Minister arising out of the discussions we have just had about paramountcy. I think that probably what the House wanted to do was to say that the supplier was unlawfully holding supplies if his paramount motive for doing so was the belief that his prices would be reduced below the recommended price. The Minister has tried to define paramountcy by this phrase: …if in addition to that ground, he has other grounds which, standing alone, would have led him to withhold those supplies. Has the Minister done what he intended? If we put those words in this Clause, are we not in the position that there might be circumstances in which the suppliers paramount motive was in fact the fear that prices would be reduced? If he had other minor motives which, had the paramount motive not been there would have led him to withhold supplies he would, according to the Amendment, be entitled so to do. We therefore now have the position that even if the paramount motive was that which the Bill seeks, to put it crudely, to make unlawful, but there were other reasons—because perhaps he did not like the co-ops, or whatever other reason there might be—he would be permitted to withhold supplies. Is the Minister sure that he is here doing what he intends to do?

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

Surely, the position is that these other grounds are such that would stand alone even if the paramount motive was not there at all.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

We then reach the position that the major and paramount reason is the one mentioned but that there may be others, and that, if the major reason were not there, the minor ones would have induced the supplier to withhold supplies, then, even though fear of price-cutting was the major motive, the supplier would be entitled to withhold supplies.

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

I may not have made myself quite clear. I believe that the court is intended to take notice of what the right hon. Gentleman calls the minor reasons assuming that the major reason of non-maintenance of prices never existed. In other words, one of these would be enough standing alone.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

I should have thought that the words meant that the other motives had to be such that had the major motive not existed those others would of themselves have been enough to induce the supplier so to act. If that is so, I do not think that the Minister is doing what he intends to do.

The other, perhaps slightly less important point is this. Ministers are always criticising the drafting of Opposition Amendments, but here I am little inclined to criticise the drafting of the Government Amendment. Line 2 of the Government Amendment states: For the purposes of this Act a supplier shall not be treated as withholding supplies of good on any such ground as is mentioned in subsection (1) of this section… I draw attention to the words "on any such ground". Would it not be more accurate, and more in accordance with the rest of the Bill, if we simply spoke of "the ground mentioned"?

In Clause 2(1) we simply have the words …on the ground that the dealer… and if we take the corresponding passage at the end of Clause 4 we find the words: …supplies were withheld on the ground that the dealer… Are we not introducing a further possible ambiguity by suddenly slipping in here the words "on any such ground"? Might not the view be that those words meant something similar but not quite the same as is referred to in Clauses 2 and 4? I only mention this because the thing has become so complicated already that we do not want to introduce further ambiguities now. I assume that the Minister's motives on this occasion are good—but I do not want to confuse things further by introducing motives in that sense.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

There appears to be some confusion. My hon. Friends seem to believe that this is a Bill to outlaw naughty people in their commercial relationships, and to prevent them from refusing to deal with people with whom they do not want to deal on any particular ground that seems right and reasonable to themselves. The Bill does not purport to do anything of the kind. It is a Bill that purports to enforce supplies to people who, it is thought, would be refused supplies on the ground that they would cut prices. In other words, nobody has yet thought it necessary to enact that a supplier shall be compelled to trade with people whom he dislikes generally, irrespective of the question of price maintenance.

9.30 p.m.

I should have thought that the hardened supporters of eighteenth century trading methods would have been satisfied that the supplier had been adequately penalised in that, for no good reason that I can see, if a man who announces himself a price-cutter asks for supplies it is assumed against the supplier that he refuses to supply on that ground. That is an unjust and unfair presumption. So much has been confided to the Court in this matter that we might have confided this, without prejudging the issue why the supplies are refused.

I should have thought that my hon. Friend the Member for Wednesbury (Mr. Stonehouse) would have been happy to know that the supplier, before he refuses supply to the price-cutter, knows that he is liable to heavy damages unless he discharges the onus of proof placed upon him, namely the prima facie assumption that he refuses supplies because of price-cutting.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

I am grateful for my hon. Friend's remarks, but he seems to misunderstand the purpose of the Bill, which is to allow retailers, if they so wish, to cut the recommended price of the suppliers. If the suppliers for some good or bad or invented reason can cut off the supplies, they can determine who is going to sell their goods and they can dictate to them the price at which the goods are to be sold. If my hon. Friend does not realise that, he does not understand how price-fixing is carried out today by the pressure of dealers on retailers, with the ultimate sanction that supplies can be withdrawn.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

It is becoming exceedingly difficult for me to put forward an argument in this debate. Earlier today I was told that I had no business to speak because I had not spoken before—[HON. MEMBERS: "Oh."]—I mean on the Bill. I am told that there is no point in my attending now because I did not attend earlier. On that ground the Minister of State was earlier seeking to disqualify me from exercising my duty. Now I am told that if I have not read a certain professor on this subject I am disqualified from expressing any view. I do not accept these disqualifications.

To answer my hon. Friend's point, he is quite mistaken in supposing that the Bill enacts that a person must supply anybody in all circumstances with goods in case refusal to supply in any way assists price maintenance. This is not what the Bill intends or pretends to achieve. The Bill forbids a person to refuse to supply goods on the ground that the retailer will cut the price if he is supplied. I thought that my hon. Friend would have been quite happy, if a man is a known price-cutter and he announces that he intends to cut prices, that the supplier would not be entitled to refuse him on that account and that only if he showed that he had other grounds which, standing alone, would have led him to withhold the supplies would the supplier be entitled to do so.

Incidentally, in reply to the hon. Member for Crosby (Mr. Graham Page) there is nothing in the Amendment about "good grounds". A man does not have to have good grounds. The hon. Member for Crosby is so well intentioned that he drafts words into the Amendment which are not there. All that the Amendment says, and I entirely applaud it for saying it, is that if, on grounds other than price-cutting, a supplier does not supply the man who wants to be supplied, there is no reason why he should be forced to supply. Even the Bill—and let us assume that I am in favour of it—states that supplies shall not be withheld on grounds merely of price cutting. So far as I know, when the Bill was introduced it was never suggested that people should be forced to supply others whom they did not want to supply on totally different grounds.

An hon. Member said that a man might invent grounds. A man may invent as many grounds as he likes, but the onus of proof is upon him to satisfy the Court of those grounds. He has got to satisfy a sceptical High Court judge, who has been instructed by this House to presume to the contrary, that there are grounds which would honestly cause him to withhold supplies, apart from the question of price-cutting. I should have thought that would satisfy anybody. It ought to be made plain that when a man refuses supplies he has got to have good grounds for so refusing—good grounds to him.

The whole purpose of the Bill is to cater for the independent, idiosyncratic will of the supplier. There is no reason why a man should be forced to supply people whom he does not like except those in special occupations, such as a licensee or somebody who holds a public authority licence of some kind. An example has been given of the man who does not like to supply Jews. A man may not like Roman Catholics or members of the Conservative Central Office. Why should a man be compelled to supply such people? The prevalance of nervous breakdowns and ulcers of the stomach will double and treble if we force suppliers to supply people whom they detest on grounds other than price-cutting.

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

I am sure the hon. Member realises that we are talking about other grounds in addition to the prohibited grounds in the earlier part of the Clause. Surely he is not taking these in isolation.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

I thought I had made it plain that I am aware of that. The purpose of the Amendment is that a man may refuse to deliver supplies if he has reasons which to him are satisfactory, and if he satisfies the Court that his reasons are good and sound—not good in the abstract sense, but good and sound to him—and that he shall then be entitled to withhold supplies. I say "Quite right, too". It would be an odd circumstance if one of my hon. Friends, a passionate member of the Labour Party, were forced to be in regular contact with a member of the Conservative Party who insisted on getting his newspapers from a particular shop. I am sure that if I were in Dr. Dering's neighbourhood he would not like to supply me, and, goodness knows, I would not like to supply him. Why should I be compelled to supply him? If an ex-Nazi comes along and wants supplies from me, am I obliged to trade with him? I may satisfy the Court that I have strong and passionate grounds for refusing to trade with him.

May I now say a word on a matter which has troubled some of my hon. Friends and, indeed, some hon. Members opposite. That is the question of paramountcy. It becomes a highly academic question. It is as if the law said that a man must not refuse the marriage proposal of a lady on the ground that she was overweight. Suppose that a 20-stone lady made a marriage proposal to me. Suppose that she was also 68 years of age, squinted and had a limp. I would say, if there were an Amendment such as this, that there were other grounds which seemed to me to be good for refusing to accept the matrimonial offer of the lady in question. The question as to which was the paramount motive becomes irrelevant. A similar situation is bound to arise in relation to matters of this kind should they come before the Court.

My final word is to emphasise yet again that the danger here is that, even after the Clause is improved in this way, suppliers will be blackmailed because, although their legal rights would be sufficient to protect them if they went to the Court, they will be afraid to go to the Court because of the so to speak, iniquitous presumption of guilt against them which is raised by the terms of the Bill.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

One of the problems raised by the Clause is the difficulty imposed upon the unfortunate judge who has to try a case. He has to decide not the reason for refusal in the existing circumstances but what might have been a reason for refusal in circumstances which have not happened. The test is purely subjective—

if…he"— that is, the supplier— has other grounds which, standing alone"— of course, they do not stand alone, because the man is a price cutter— would have led him to withhold those supplies". How can any judge decide that question? My right hon. Friend the Member for Battersea, North (Mr. Jay) said that a price-cutter was not a dishonourable man, that a man was not dishonourable merely because he reduced prices. Nobody will dispute that. A man is dishonourable only if he reduces prices when he has promised not to, in the same way as a man is dishonourable if he does not pay his debts. Both are unenforceable contracts, but both involve breaking one's word.

If the ground is that the supplier does not care to deal with people who do not keep their word, is that an "other ground" which, standing alone, would lead him to refuse supplies? It is true that his failure to keep his word was evidenced by the fact that he cut prices when he had agreed not to. Is that an "other ground" or is it not? It is a reason additional to the cutting of prices which might have occurred without any agreement not to. I do not know. Is it intended that it should be so or not? I think that it is a reason which would apply in the mind of a good many people; it would certainly apply in mine.

Moreover, it is quite clear, as my hon. Friend the Member for Cheetham (Mr. H. Lever) pointed out, somewhat to the suprise of several hon. Members opposite, that the goodness of the reason has nothing to do with the case at all. It does not matter how bad the reason is so long as it is a reason which the supplier would have acted upon in any event. In my view, this is a provision which, apart from other considerations, is wholly unworkable.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

May I, by leave of the House, endeavour to reply to the questions which have been put to me, notably by the right hon. Member for Battersea, North (Mr. Jay) and my hon. Friends the Members for Crosby (Mr. Graham Page) and for Stratford-on-Avon (Mr. Maude)?

I take, first, the point about drafting raised by the right hon. Member for Battersea, North. In our opinion, the words "on any such ground" are right in this particular Amendment because there are several grounds comprised within Clause 2(1). On the other hand, I should not suggest for a moment that Government drafting is so impeccable that it can never be improved. The fact that we have already accepted Amendments will, I hope, indicate our view on this matter. Certainly I am ready to look at it. My first opinion is that the drafting is perfectly in order.

9.45 p.m.

The hon. Member for Wednesbury (Mr. Stonehouse) seemed to take the view that the Amendment was so strong that it made Clause 2 absolutely worthless. On the other hand, the hon. Member for Sheffield, Brightside (Mr. Winterbottom) took an entirely different view. He thought that the Amendment was absolutely nebulous. Both hon. Members cannot be right. I thought that my hon. Friend the Member for Crosby was entirely right when he said, by inference, that there was no weakening in the principle of the Bill. During the Committee stage we had substantial discussions of these matters. It was suggested, not least by my hon. Friends, particularly by my hon. Friend the Member for Crosby, that there were good practical reasons why we should consider an Amendment of this sort. My right hon. Friend the Secretary of State accepted that view, hence the Amendment. I repeat that there is no weakening of the Bill. In our opinion, this is a right and practical thing to do.

The hon. Member for Manchester, Cheetham (Mr. H. Lever) took the view that this Amendment was an improvement on the Bill. I am content to rest myself on his honourable and learned opinion.

I hope that some of the things said during the debate will act as a reassurance to my hon. Friend the Member for Stratford-on-Avon. He was principally concerned about blackmail. I do not think that is a real possibility in any sense, although naturally we shall give full weight to the opinions which he expressed.

The basic question has revolved round the subject of paramountcy raised by the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) and the right hon. Member for Battersea, North, and by some of my hon. Friends, particularly my hon. Friend the Member for Bedfordshire, South (Mr. Cole) in an intervention. I think that the answer to the point comes from posing a very simple question. The question which should be decided is this: would the supplier have withheld the goods if the dealer had not been selling below the recommended price? It is as simple and clear as that. I am glad to see that I carry the hon. and learned Member for Cheetham with me.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

I apologise to the hon. Member and to the House. I may have got it wrong technically. I do not believe that I have it wrong as a matter of fact, particularly since, if I may modestly say so, the honourable if not learned Gentleman agrees with me.

My hon. Friend the Member for Crosby was right when he said that the Court must be satisfied if the matter was challenged. On the basis of that question there is no real difficulty.

Photo of Sir Arthur Irvine Sir Arthur Irvine , Liverpool Edge Hill

Would the hon. Gentleman explain this to me? No doubt he can do so in a sentence, but I have difficulty on the point. If there is a series of motives, why is it necessary, in order to test the paramountcy of a particular motive in the series, to stand that particular motive alone?

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

It is necessary to divorce it from the point of price cutting. That is our opinion, and we think that we have the wording right. I am ready to consider alternative wording at any stage, because obviously we want to make a success of this item. I said that it was a practical matter. We wanted to meet hon. Members' wishes, which is what we have endeavoured to do. At the moment we are discussing this wording and not alternative wording.

My hon. Friend the Member for Crosby asked whether insolvency could be considered a ground for withholding supplies. Certainly it may, however that insolvency is caused.

To sum up, the Amendment, as I endeavoured to explain when I introduced it, should make it clear that, where there are reasons other than price cutting which, standing alone, would have led a supplier to withhold supplies, the withholding will not be unlawful. The hon. and learned Member for Northampton (Mr. Paget) and some other hon. Members opposite suggested that this would be a point of real difficulty for the Court. As my hon. Friend the Member for Crosby said, there can be a wide variety of perfectly legitimate business reasons why one man does not want to trade with another. I am certain that those difficulties are largely imaginary. For these reasons, I reject the suggestion of difficulty inherent in the Amendment. We think that the new subsection is right, we have endeavoured to meet the wishes of the House and I hope that it will receive, finally and now, the general approval of the House.

Amendment agreed to.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

I beg to move Amendment No. 15, in page 3, line 20, at the end, to insert: (4) Nothing in this section shall make it unlawful for a supplier to withhold goods from any dealer to whom he has not previously sold goods or who refuses or fails to comply with a requirement by the supplier that he shall pay cash or the equivalent of cash on order. The Amendment deals with two points: first, the withholding of supplies from dealers with whom the manufacturer has never previously traded, and, secondly, the condition that cash or its equivalent shall be paid for the goods. The latter question of cash and credit arises under a later Amendment No. 20, which is to be moved by the Government. I therefore confine myself to arguing the case of the supplier who is to be compelled to sell goods to somebody with whom he has never dealt.

As I said earlier, most of the difficulties of the Bill, particularly this part of it, arise from the attempt to induce people to trade with those with whom they do not wish to trade. I cannot go quite as far as my hon. Friend the Member for Wednesbury (Mr. Stone-house), who merely argues quite simply that unless we have some provision about the withholding of supplies the whole Bill will be null and void. That argument constitutes a case for preventing the withholding of supplies in some circumstances, but it need not carry us to the extreme length with which we are now confronted in the Bill.

Nor is it wholly convincing to say that any supplier can defeat the purpose of the Bill by withholding supplies. My hon. Friend argued that that was easy in every case. We have to remember as the background of this discussion that the collective boycott is now illegal in any event. Therefore, if one manufacturer withholds supplies from a retailer, the retailer may get supplies from another manufacturer. It is impossible to say in a given case quite how the economics will work out. That is not, therefore, a sufficient answer to the argument.

We have reached the point—I say this to show how modest and moderate our Amendment is—when it is accepted that the Bill will compel a number of traders to sell goods to those to whom they do not wish to sell. We have also accepted that if the supplier is not to do that, the onus of proof is upon him to make his case in court that his motives were such and such. We have also accepted that he must prove what his motives were. In view of our decision on the last Amendment, we have accepted that he has also to prove what his motives might have been. That seems to be going quite far enough.

It is just possible that one could justify the introduction of that degree of compulsion into trade as a sanction for the ultimate purpose of the Bill, but to go beyond that and say that the supplier is to be compelled, on pain of all these legal proceedings, to supply somebody whom he does not wish to supply, and somebody with whom he has never done business before, is to carry the Bill to extremes.

I ask the Government to consider whether it would not introduce a little reason, moderation and common sense into this Measure if we were to stop at this point and say that all these provisions would not apply where the dealer who demanded supplies was somebody with whom the manufacturer had not done business before. The Minister, or someone on the Government side, said earlier that it would be wrong to discourage new entrants into the trade. It was the hon. Member for Stratford-on-Avon (Mr. Maude). Of course it would; but, of course, if the Government accepted this Amendment it would be perfectly open to the manufacturer to deal with new retailers if he wished to do so. There would be a free choice on either side. All it will say is that he will not be compelled to supply those people against his will in the circumstances laid down in the Bill.

It really does seem to me to be going to extreme lengths to introduce compulsion of this order. When we have debated the location of industry we have sometimes talked of direction, and a lot of nonsense h as been talked about direc- tion. It is sometimes suggested that we can compel people to put factories where they do not want to. We on this side of the House have often pointed out that one cannot by law compel a man to build a factory where he does not wish to. What one can compel him to do is not to build one where one does not want him to. That is perfectly possible, and it may be a wise thing to do. A lot of things said about direction, including a remark by the Prime Minister at Question Time last week, are really no more than nonsense.

What the Minister here is doing is to introduce a real measure of direction into trade, if he says that somebody has to start trading with a retailer with whom he has never traded before, on pain of legal action. This is carrying the process to a really extreme point, and I would suggest to the Minister that, having accepted all those other provisions, which may perhaps be necessary, it really would be wise to stop at this point and to accept the very modest limitation contained in this Amendment.

Photo of Mr Angus Maude Mr Angus Maude , Stratford-on-Avon

I shall try not to repeat what I said on the last Amendment. I rise to say one thing quite briefly. I still believe that the right hon. Gentleman the Member for Battersea, North (Mr. Jay) is going too far with this Amendment. Nevertheless, I still believe that he is on to a good point. I think also that my hon. Friend the Minister of State did not really go quite far enough in his reply to the last Amendment to allay the fears of those who believe that it is possible for a supplier to be placed in a position of jeopardy and great expense in being required to supply goods to somebody with whom he has never supplied them before and to whom he does not want to supply them now. If it would be possible in another place to produce a compromise Amendment which would go some way towards meeting this I think we should all be perfectly satisfied.

I would be perfectly happy if my hon. Friend could convince me, for example, that the fact that the supplier has never supplied a retailer before would in itself be a ground which, standing alone, would be held to justify him in not supplying him now. This seems to me might very well be so. If this is so, and it is covered by the Amendment which the House has just passed, I think that our fears will be set at rest; but we should like a real reassurance.

My hon. Friend said he did not think there was any justification for a belief that suppliers could be blackmailed. [Interruption.] Perhaps "blackmail" is an extreme word. They might, nevertheless, be put to considerable inconvenience and expense by being threatened with proceedings by retailers whom they had never supplied before, and they might find themselves in a position where it would be, let us say, cheaper, less troublesome, however unpleasant, to deal with people with whom they did not want to deal and had not dealt before.

Clauses 2 and 4 taken in conjunction have aroused quite considerable fears in this respect among a number of suppliers. I would be most grateful if my hon. Friend could tell us whether the fact that a manufacturer has never before dealt with the retailer would give the supplier reason for hope that under the Amendment we have just passed that would be a ground to enable him not to do so.

It being Ten o'clock, the debate stood adjourned.

Ordered,That the Proceedings on Government Business may be entered upon and proceeded with at this day's Sitting at any hour, though opposed. —[Mr. Redmayne]

Question again proposed, That the proposed words be there inserted in the Bill.

Photo of Mr Harold Lever Mr Harold Lever , Manchester Cheetham

I shall not detain the House for more than a moment in expressing one point. This is an Amendment which can be accepted by those who believe in the purposes of the Bill and those who are opposed to it.

It is a fallacy to suppose that the abolition of price maintenance depends on compelling people to go through this utterly repugnant experience of trading with people with whom they do not want to trade. Price maintenance in the past has only precariously proved maintainable when we have been able to enforce fully at law a whole array of penalties against people who broke the rule of price maintenance. Far from it being the case that one needs to enforce deliveries of supplies, the position is that once one makes it illegal collectively to enforce price maintenance, one does not need these provisions at all. Therefore, this reasonable and entirely desirable Amendment ought to be accepted by the Government.

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

What the hon. Member for Manchester, Cheetham (Mr. H. Lever) has said is not the whole story. Unless one blocks up the ways out, one cannot insist on the maintenance of the abolition of resale price maintenance.

With regard to what my hon. Friend the Member for Stratford-on-Avon (Mr. Maude) said, I do not think that my hon. Friend the Minister of State can answer his question. It is a matter for the Court to decide whether the fact that there is a new dealer and there is reluctance to supply him is a good enough reason standing alone.

I support the Amendment. As the right hon. Member for Battersea, North (Mr. Jay) said, one part is already covered in Amendment No. 20, and I think that the first part of it ought to be in the Bill specifically. No hon. Member, not even my right hon. Friend, can decide the question under the first part of the Amendment. I can imagine that a man might not want any more outlets for his business, and, therefore, being fully occupied in the area, might not want to supply a certain dealer. That defence might not stand up before the Court under Amendment No. 14. I do not know of any way whereby we can prejudge the decision of the Court in that respect. The Amendment should be accepted so that the Court might know beyond equivocation what we mean in this respect. We need the Amendment.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

As the right hon. Member for Battersea, North (Mr. Jay) said, the Amendment is in two parts. There is the cash part, to which he made very short reference. He and my hon. Friend the Member for Bedfordshire, South (Mr. Cole) have acknowledged that the Government have endeavoured to deal with the matter in a later Amendment which we shall discuss shortly, Amendment No. 20. That might be described as the terms of payment Amendment. It is a matter about which we had substantial discussion in Committee.

As there has been no discussion on the cash point, and as the right hon. Gentleman and my hon. Friend have acknowledged by inference that they appreciate that the Amendment exists, perhaps I need not spend time talking about that part of the Amendment but shall be better advised to go straight on to the other matter, regarding which substantial discussion has occurred, not least in the intervention by my hon. Friend the Member for Stratford-on-Avon (Mr. Maude). I am sorry that my hon. Friend the Member for Stratford-on-Avon felt that, because I was endeavouring to get on a little I did not do the points which he raised on the last Amendment sufficient justice.

It would be appropriate, I think, if I said at once and plainly that the second purpose of the Amendment is quite unacceptable to the Government for reasons which I shall describe Some of them were very clearly advanced by my hon. Friend the Member for Stratford-on-Avon when we were discussing the last Amendment. I appreciate that he understands that they remain. He did not want to take up the time of the House by rehearsing them.

The effect of this part of the Amendment would be that in no circumstances could it be unlawful for a supplier to withhold supplies from a dealer with whom he had not previously done business. We had some discussion about this in Committee. Our view is that there is no reason for weakening Clause 2 in this way. The present position, in the light of the Amendment which the House has just accepted, is that the supplier is free to decide with whom he will do business, except where his only motive in refusing to sell is that the dealer concerned is selling below the recommended price.

As my hon. Friend the Member for Stratford-on-Avon stated plainly, we frankly do not think that it would be in the best interests of the economy to put difficulties in the way of newly established dealers. That is the answer to the point made by my hon. Friend the Member for Bedfordshire, South. If suppliers can effectively prevent enterprising newcomers from getting supplies, the flexibility which we want will not be introduced into the distributive system.

This is one of the objects of the Bill. For that reason, particularly, we find the Amendment totally unacceptable.

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

It would not prevent new retailers from getting supplies. Any manufacturer would be free to supply them if they wished.

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton

With great respect, the right hon. Gentleman seems to be a little naive. I can see a new form of retailing completely killed by suppliers who are determined to kill it. We think that the Amendment goes much too far.

My hon. Friend the Member for Stratford-on-Avon asked me a question about the previous Amendment which is relevant to the consideration which we are giving to this Amendment. He questioned whether a supplier who had never before dealt with a particular retailer could be let out under Amendment No. 14. As my hon. Friend the Member for Bedfordshire, South said, this is not a question upon which I can give a straight "Yes" or "No" answer. On the other hand, I can give my hon. Friend some guidance, and I shall be pleased to do so.

I can imagine cases in which, within the context of the discussions which we had on Amendment No. 14, which is very plain on the subject of paramountcy, the supplier could well say that in a particular town, for instance, he already had all the retail outlets which he wanted or which he could supply or which he could afford to supply, and that he therefore found himself in a position in which, for legitimate business reasons, a phrase used by my hon. Friend the Member for Crosby (Mr. Graham Page), he did not wish to supply; and in those circumstances he would be free not to supply. I gave one example and I could think of a substantial number of similar cases. I hope that my hon. Friend the Member for Stratford-on-Avon feels that even though I cannot be as clear as he wishes and cannot give him an exhaustive catalogue, I can think of many cases in which that would apply.

On the question of commercial blackmail to which my hon. Friend referred, and on which I answered him in relation to the previous Amendment as best I could with a clear statement under advice, perhaps I should say a further word. It is our opinion that if a completely unfounded case were brought against a supplier who has not previously supplied a dealer and did not want to supply him for some reason unconnected with price-cutting, it should be comparatively much easier for him to establish this than in a case in which the dealer is an old case. I think that the position is entirely clear.

We have dealt with the payment-of-cash part of the Amendment. As for the remainder of it, we are entirely satisfied that if we pass the Amendment it would dangerously weaken the Bill. I am sorry to be as plain as that with the right hon. Gentleman. I prefer to agree with him rather than disagree with him, but when I disagree with him I say so plainly. We think that the Amendment would dangerously weaken the Bill, and I must advise the House to reject it.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

The Minister of State has deployed some powerful arguments against the Amendment and I find myself in substantial agreement with him. If the Amendment were accepted, it would undermine the strength of Clause 2 and would make it very difficult for new forms of efficient retailing to develop.

I will give an example. If a discount house organisation sets up a completely new organisation and is able, through economies on overhead expenditure, to be able to pass on all the benefits of substantially lower prices to customers who choose to go some way to the discount house and help themselves, it would be possible for suppliers, if the Amendment went through, to deny that organisation supplies of their commodities. That would be a substantial discouragement to the development of new forms of retailing, which are bound to be in the interests of consumers generally if they have the advantage of lower prices through higher efficiency passed on to them.

I find myself in agreement with the second part of the Amendment, but as this is dealt with by Amendment No. 20, it can be left until then. In view of my feelings on this Amendment, I will have to advise my right hon. Friends that I will have to abstain if the Amendment is forced to a Division.

Question put, That the proposed words be there inserted in the Bill:—

The House divided: Ayes 133, Noes 202.

Division No. 92.AYES10.12 p.m.
Ainsley, WilliamHarper, JosephProbert, Arthur
Allen, Scholefield (Crewe)Hayman, F. H.Pursey, Cmdr. Harry
Awbery, Stan (Bristol, Central)Holman, PercyRankin, John
Barnett, GuyHoughton, JuglasRedhead, E. C.
Beaney, AlanHowell, Denis (Small Heath)Rees, Merlyn (Leeds, S.)
Blackburn, F.Hewle, W.Rhodes, H.
Blyton, WilliamHoy, James H.Roberts, Albert (Normanton)
Bowden, Rt. Hn. H. W. (Leics, S. W.)Hughes, Cledwyn (Anglesey)Robertson, John (Paisley)
Boyden, JamesHughes, Hector (Aberdeen, N.)Rodgers, W. T. (Stockton)
Braddock, Mrs. E. M.Hunter, A. E.Short, Edward
Bradley, TomHynd, H. (Accrington)Silkin, John
Broughton, Dr. A. D. D.Hynd, John (Attercliffe)Silverman, Julius (Aston)
Butler, Herbert (Hackney, C.)Irvine, A. J. (Edge Hill)Skettington, Arthur
Carmichael, NeilIrving, Sydney (Dartford)Slater, Mrs. Harriet (Stoke, N.)
Collick, PercyJanner, Sir BarnettSlater, Joseph (Sedgefield)
Craddock, George (Bradford, S.)Jay, Rt. Hon. DouglasSmall, William
Cronin, JohnJones, Elwyn (West Ham, S.)Smith, Ellis (Stoke, S.)
Crossman, R. H. S.Jones, J. Idwal (Wrexham)Sorensen, R. W.
Cullen, Mrs. AliceJones, T. W. (Merioneth)Spriggs, Leslie
Dalyell, TamKenyon, CliffordStewart, Michael (Fulham)
Darling, GeorgeLawson, GeorgeStones, William
Davies, G. Elfed (Rhondda, E.)Lee, Frederick (Newton)Swain, Tnomas
Davies, Ifor (Gower)McBride, N.Swingler, Stephen
Dempsey, JamesMcCann, J.Symonds, J. B.
Diamond, JohnMacColl, JamesTaylor, Bernard (Mansfield)
Dodds, NormanMacDermot, NiallThomas, lorwerth (Rhondda, W.)
Duffy, A. E. P. (Colne Valley)McInnes, JamesThompson, Dr. Alan (Dunfermline)
Edwards, Rt. Hon. Ness (Caerphilly)MacPherson, MalcolmThomson, G. M. (Dundee, E.)
Edwards, Robert (Bilston)Mallaieu, E. L. (Brigg)Wainwright, Edwin
Edwards, Walter (Stepney)Mapp, CharlesWatkins, Tudor
Evans, AlbertMayhew, ChristopherWeitzman, David
Fernyhough, E.Mellish, R. J.Wells, William (Walsall, N.)
Finch, HaroldMitchison, G. R.White, Mrs. Eirene
Fitch, AlanNeal, HaroldWilkins, W. A.
Fletcher, EricNoel-Baker, Rt. Hn. Philip (Derby, S.)Willey, Frederick
Foley, MauriceOram, A. E.Willis, E. G. (Edinburgh, E.)
Foot, Michael (Ebbw Vale)Owen, WillWinterbottom, R. E.
Fraser, Thomas (Hamilton)Padley, W. E.Woodburn, Rt. Hon. A.
Galpern, Sir MyerPaget, R. T.Woot, Robert
George, Lady Megan Lloyd (Carmthn)Pargiter, G. A.Wyatt, Woodrow
Ginsburg, DavidPavitt, LaurenceYates, Victor (Ladywood)
Gordon Walker, Rt. Hon. P. C.Pearson, Arthur (Pontypridd)
Gourlay, HarryPeart, FrederickTELLERS FOR THE AYES:
Griffiths, David (Rother Valley)Pentland, NormanMr. Charley A.
Hale, Leslie (Oldham, W.)Popplewell, ErnestMr. Grey.
Hannan, WilliamPrice, J. T. (Westhoughton)
NOES
Agnew, Sir PeterChichester-Clark, R.Gibson-Watt, David
Anderson, D. C.Clark, Henry (Antrim, N.)Gilmour, Ian (Norfolk, Central)
Atkins, HumphreyClark, William (Nottingham, S.)Gilmour, Sir John (East Fife)
Awdry, Daniel (Chippenham)Cleaver, LeonardGlover, Sir Douglas
Barlow, Sir JohnCooke, RobertGlyn, Dr. Alan (Clapham)
Barter, JohnCordeaux, Lt.-Col. J. K.Glyn, Sir Richard (Dorset, N.)
Batsford, BrianGarfield, F. V.Gough, Frederick
Bell, RonaldCostain, A. P.Gower, Raymond
Bennett, F. M. (Torquay)Coulson, MichaelGrant-Ferris, R.
Bennett, Dr. Reginald (Gos & Fhm)Craddock, Sir Berestord (Speithorne)Green, Alan
Biffen, JohnCrawley, AidanGresham Cooke, R.
Bingham, R. M.Dalkeith, Earl ofGrosvenor, Lord Robert
Birch, Rt. Hon. NigelDance, JamesGurden, Harold
Bishop, Sir PatrickDeedes, Rt. Hon. W. F.Hamilton, Michael (Wellingborough)
Black, Sir CyrilDigby, Simon WingfieldHarris, Frederic (Croydon, N.W.)
Bossom, Hon. CliveDonaldson, Cmdr. C. E. M.Harris, Reader (Heston)
Bourne-Arton, A.Doughty, CharlesHarrison, Col. Sir Harwood (Eye)
Bowen, Roderic (Cardigan)Douglas-Home, Rt. Hon. Sir AlenHarvey, John (Walthamstow, E.)
Box, Donalddu Cann, EdwardHarvie Anderson, Miss
Boyd-Carpenter, Rt. Hon. JohnEden, Sir JohnHastings, Stephen
Braine, BernardElliot, Capt Walter (Carshalton)Heath, Rt. Hon. Edward
Brewis, JohnElliott, R. W. (Newc'tle-upon-Tyne, N.)Henderson, John (Cathcart)
Brown, Alan (Tottenham)Emery, PeterHendry, Forbes
Browne, Percy (Torrington)Errington, Sir EricHiley, Joseph
Bryan, PaulFarr, JohnHill, Mrs. Eveline (Wythenshawe)
Buck, AntonyFell, AnthonyHill, J. E. B. (S. Norfolk)
Bullus, Wing Commander EricFinlay, GraemeHobson, Rt. Hon. Sir John
Campbell, GordonFisher, NigelHooking, Philip N.
Chataway, ChristopherFletcher-Cooke, CharlesHolland, Philip
Holt, ArthurMawby, RaySmith, Dudley (Br'ntf'd & Chiswick)
Hooson, H. E.Maydon, Lt.-Cmdr. S. L. C.Spearman, Sir Alexander
Hornsby-Smith, Rt. Hon. Dame P.Mills, StrattonSpeir, Rupert
Hughes Hallett, Vice-Admiral JohnMiscampbell, NormanStainton, Keith
Hughes-Young, MichaelMore, Jasper (Ludlow)Stanley, Hon. Richard
Hulbert, Sir NormanMorgan, WilliamStoddart-Scott, Col. Sir Malcolm
Hurd, Sir AnthonyNeave, AireyStorey, Sir Samuel
Jackson, JohnNoble, Rt. Hon. MichaelStudholme, Sir Henry
Johnson, Eric (Blackley)Orr, Capt. L. P. S.Summers, Sir Spencer
Jones, Arthur (Northants, S.)Orr-Ewing, Sir Ian (Hendon, North)Tapsell, Peter
Kaberry, Sir DonaldOsborn, John (Hallam)Taylor, Edwin (Bolton, E.)
Kerans, Cdr. J. S.Page, John (Harrow, West)Taylor, Frank (M'ch'st'r, Moss Side)
Kerr, Sir HamiltonPage, Graham (Crosby)Temple, John M.
Kershaw, AnthonyPannell, Norman (Kirkdale)Thomas, Sir Leslie (Canterbury)
Kimball, MarcusPartridge, E.Thompson, Sir Richard (Croydon, S.)
Kirk, PeterPearson, Frank (Clitheroe)Tiley, Arthur (Bradford, W.)
Kitson, TimothyPickthorm, Sir KennethTilney, John (Wavertree)
Lambton, ViscountPitt, Dame EdithTouche, Rt. Hon. Sir Gordon
Langford-Holt, Sir JohnPounder, RaftonTurner, Colin
Leavey, J. A.Pace, David (Eastleigh)van Strauhenzee, W. R.
Lewis, Kenneth (Rutland)Prior, J. M. L.Vaughan-Morgan, Rt. Hon. Sir John
Lilley, F. J. P.Prior-Palmer, Brig, Sir OthoWade, Donald
Lindsay, Sir MartinProudfoot, WilfredWalder, David
Linstead, Sir HughQuennell, Miss J. M.Ward, Dame Irene
Litchfield, Capt. JohnRamsden, Rt. Hon. JamesWebster, David
Lloyd, Rt. Hon. Selwyn (Wirral)Rawlinson, Rt. Hon. Sir PeterWells, John (Maidstone)
Longbottom, CharlesRedmayne, Rt. Hon. MartinWhitelaw, William
Longden, GilbertRees, Hugh (Swansea, W.)Williams, Dudley (Exeter)
Loveys, Walter H.Rees-Davies, W. R. (Isle of Thanet)Williams, Paul (Sunderland, S.)
Lucas, Sir JocelynRenton, Rt. Hon. DavidWills, Sir Gerald (Bridgwater)
Lucas-Tooth, Sir HughRidley, Hon. NicholasWilson, Geoffrey (Truro)
McAddan, Sir StephenRidsdale, JulianWise, A. R.
MacArthur, IanRobson Brown, Sir WilliamWotrige-Gordon, Patrick
McLaren, MartinRoots, WilliamWoodnutt, Mark
Maclay, Rt. Hon. JohnRopner, Col. Sir LeonardWorsley, Marcus
McMaster, Stanley R.Royle, Anthony (Richmond, Surrey)
Maitland, Sir JohnScott-Hopkins, JamesTELLERS FOR THE NOES:
Marten, NeilSeymour, LeslieMr. Peel and Mr. Pym.
Mathew, Robert (Honiton)Sharples, Richard
Maude, Angus (Stratford-on-Avon)Shaw, M.