Sanctions and Anti-Money Laundering Bill [HL] - Committee (2nd Day)

– in the House of Lords at 4:32 pm on 29th November 2017.

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Relevant documents: 7th Report from the Delegated Powers Committee and 8th Report from the Constitution Committee

Clause 17: Extra-territorial application

Amendment 52

Moved by Lord Lennie

52: Clause 17, page 15, line 20, leave out subsection (4) and insert—“(4) For the purposes of subsection (2)(b), a body incorporated or constituted under the law of any part of the United Kingdom includes a body incorporated or constituted under the law of the following— (a) any of the Channel Islands;(b) the Isle of Man;(c) any of the British overseas territories.”

Photo of Lord Lennie Lord Lennie Opposition Whip (Lords)

My Lords, this is a probing amendment concerning the territorial application of sanctions regulations. The amendment will make it automatic that the sanctions imposed would apply to bodies incorporated or constituted in the Channel Islands, the Isle of Man or the British Overseas Territories. This is not because they are favourite places to hide away from tax regimes—although they are—but because they are dependent on the UK in terms of foreign and defence policy matters. For sanctions to have an effect, they have to have an international dimension. Currently determined by the UN or the EU, they require co-operation and co-ordination between and across nations. It is surely a matter of good policy to seek to put our own house in order first—which this amendment would help to do.

The Bill currently proposes that its sanction provisions “may” be applied to the Channel Islands, the Isle of Man or the British Overseas Territories by use of an Order in Council, which I understand is a Privy Council matter. I am not a member of the Privy Council and I do not know how it operates. I do not understand in detail how it works, and I am not sure whether such orders are always granted, whether there is ever a debate about them, whether they can be challenged or whether there is delay built into the process. This amendment would make it clear that, as far as sanctions are concerned, the UK will have a consistent application of the law. We would welcome the Government’s views on that.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

My Lords, I support the amendment. It is useful to have more precise definitions within the Bill, and it seems that the amendment seeks to tighten up the subsections which relate to the Channel Islands, the Isle of Man and the British Overseas Territories, so that instead of a Minister being able by an Order in Council to add these areas, they are included in primary legislation. It makes sense to clarify that now and in primary legislation in this way to ensure that those whom the UK wishes to sanction cannot evade that sanction by association with these areas. If the UK is to leave the EU, it makes sense to tighten in this way.

The Minister will know that there is a meeting today of the Joint Ministerial Council at the Foreign Office with the overseas territories. Perhaps he could assure us that they would be content to be clearly within the same sanctions regime. I know that they will be less keen on aligning themselves with the UK on anti-money laundering measures; we will of course come to that later.

I also flag to the Minister that, in addition, the Law Society emphasises that guidance should be given on the terms in Clause 17, as well as those in Sections 2, 10, 15 and 46. It points out that in Clause 17 it is unclear whether the UK sanctions regime would apply,

“where UK currency is used, where a non-UK subsidiary of a UK company is involved, or where a UK person on the board of a non-UK company is present when a decision is taken in breach of the UK sanctions regime”.

It suggests that Clause 17 should be renamed “UK nexus” as its current subject matter does not deal sufficiently with “Extra-territorial application”.

It seems that further clarity is required on such issues. Clearly, it would be useful if stakeholders were properly consulted to assess the impact of the scope of application of the UK sanctions regime, simply to identify any unintended consequences. Clearly, intended consequences are fine. So this is a complicated area, but I hope that the Minister will take on board this advice.

Photo of Lord Faulks Lord Faulks Conservative

My Lords, I note the nature of the amendment and the final provisions in the Bill in Clause 51(3). I was at one stage a Minister with responsibility for the Crown dependencies, so I am acutely conscious of the particular constitutional relationship between the United Kingdom and the Crown dependencies. As I understand it, we do not normally legislate without their express consent. I wonder whether that is why the Bill is framed as it is. However, I look forward to hearing the Minister’s response on this.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank the noble Lord for tabling this amendment. The noble Baroness, Lady Northover, talked about the Joint Ministerial Council; as a Minister for the Overseas Territories, today has been one of those days when I find myself shuttling between the Joint Ministerial Council and your Lordships’ House. I can confirm to the noble Baroness that this issue—and other elements that relate to the departure of the UK from the European Union—is very much on the agenda of our discussions with the overseas territories. Indeed, as we speak, my honourable friend Minister Walker is hosting a session with them on the implications of the United Kingdom leaving the European Union. The noble Baroness raised issues on guidance and I will certainly take back the issue of where we can clarify certain elements.

I will pick up on a couple of points so I can clear them at the start. In his intervention, my noble friend Lord Faulks

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

I am fully cognisant of that. I meant no discourtesy to noble Lords on the Opposition Front Bench; I thought it appropriate to give the context of what I was going to say. The clarification that my noble friend provided from the outset is exactly why the particular clauses have been framed as such.

I will now take up what the noble Lord, Lord Collins, has just pointed out. The amendment is in the names of the noble Lords on the Opposition Front Bench. I thank them, as I did at the start. I believe that I came to the noble Lord, Lord Lennie, first—we will have to check Hansard on that—to thank him for tabling the amendment.

Clause 17 sets out which persons can be bound by sanctions regulations, in the UK and elsewhere. It also confirms that prohibitions or requirements can be imposed on any conduct in the UK, including UK territorial waters, or on any UK person anywhere in the world. This clause is consistent with the way the UK currently implements sanctions as part of the European Union. If noble Lords are interested, further detail is provided in the White Paper we published in April.

Clause 17 also allows for Her Majesty, by an Order in Council, to extend the effect of sanctions to bodies incorporated or constituted under the law of any of the Channel Islands, the Isle of Man and any of the British Overseas Territories. This amendment would remove the ability of Her Majesty to make an Order in Council in respect of corporate bodies registered in the overseas territories and Crown dependencies. Instead, it would require that, when UK Ministers legislate to create sanctions in regulations, these bodies would automatically be caught.

When introducing this particular amendment, the noble Lord referred to the overseas territories in a very generic way. I have had the good fortune of visiting one or two of them—somewhat tragically in the aftermath of the hurricanes that hit—and generalising all our overseas territories in a particular way is not something I would subscribe to. They provide some incredible potential. For example, I am not sure how many Ministers partake of lobster, but apparently Tristan da Cunha has the best lobster in the world. On a more practical note, we have done some incredible work with them on marine protection and building sustainable economies.

I make that point because it is important to recognise the role that our overseas territories play. However, I agree with the point the noble Lord raised that the overseas territories and Crown dependencies must follow the UK Government’s foreign policy, including the sanctions we apply, and that bodies incorporated or constituted in these jurisdictions must also be bound by sanctions. The Foreign Office—to confirm what I said at the start to the noble Baroness, Lady Northover—has discussed the Bill with the overseas territories and Crown dependencies, and they also accept this point of principle.

However, there are constitutional considerations that affect the way sanctions are implemented by the overseas territories and Crown dependencies. As my noble friend Lord Faulks pointed out, at the moment all Crown dependencies—Jersey, Guernsey and the Isle of Man—legislate on their own behalf, as do Gibraltar and Bermuda. We anticipate that these jurisdictions will seek to continue to do so—save, possibly, for a transitional period. We legislate for some of these jurisdictions directly through Orders in Council. However, as I have said, other jurisdictions legislate for themselves.

The Bill is drafted in a way that reflects this reality. It is consistent with the current implementation model for UN and EU sanctions, as well as measures under the Terrorist Asset-Freezing etc. Act 2010. To change this model would depart from current practice and we do not see a compelling case for this. With that explanation—and the assurance I have given to the noble Baroness on the valid point she raised about the Law Society, which I will certainly look at again—I hope that the noble Lord will be minded to withdraw this amendment.

Photo of Lord Lennie Lord Lennie Opposition Whip (Lords)

I thank the Minister for that answer. We will consider, read carefully what he said and, perhaps, come back to it. In the meantime, we will seek leave to withdraw the amendment.

Amendment 52 withdrawn.

Clause 17 agreed.

Clause 18 agreed.

Clause 19: Right to request variation or revocation of designation

Amendment 53 not moved.

Amendment 54

Moved by Lord Pannick

54: Clause 19, page 16, line 15, after “decide” insert “as soon as reasonably practicable”

Photo of Lord Pannick Lord Pannick Crossbench

My Lords, this amendment is in my name and those of the noble and learned Lord, Lord Judge, and the noble Lord, Lord Collins of Highbury. It is not concerned with lobsters; it is concerned with the duty of the Minister to consider a request to vary or revoke a designation. The Bill contains no provision requiring the Minister to address such a request within any specific time period. I can understand why it would be inappropriate to set any defined time period—how long it takes to address a request to vary or revoke a designation will inevitably depend on the circumstances of the individual case—but the Bill should, I think, contain a more general obligation on the Minister in relation to time. This amendment would require the Minister to decide on a request to revoke or vary,

“as soon as reasonably practicable”.

It is important for the Bill to impose such an obligation because, under Clause 32, read with Clause 33(5), a person who is put on a sanctions list cannot seek a review from the court until the Minister has made the decision on the request to vary or revoke the designation. It would be quite wrong for a person to be listed, with all the adverse consequences that that involves, with no opportunity to complain to a court unless the Minister had an obligation to act with reasonable expedition. In an extreme case, were this amendment to be included in the Bill, the courts would be able to say to the Minister that his or her delays were unacceptable.

I cannot see that a “reasonably practicable” test could be in any way objectionable. I suspect that the Minister will tell the Committee that the amendment is unnecessary because of course Ministers will decide these cases as soon as reasonably practicable. We have heard such assurances repeatedly during this Committee stage. However, I am sure that the Minister understands that in contexts as important as this Bill I prefer to see obligations written into the statute rather than rely on assurances from Ministers, however fair and reasonable they are. I beg to move.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

This seems an eminently reasonable amendment. It almost seems unambitious in its scope—it invites Ministers to answer questions along the lines of “as soon as possible” and “shortly”—but noble Lords are surely right to seek to put something of a common-sense timetable on this, and we support them. The Bill proposes to give such wide and untrammelled powers to Ministers that any moves to qualify them should be welcomed.

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

As the noble Lord said, I have added my name to this amendment, and I have done so for a very good reason, which is that it is about an important matter of procedural fairness and should be included in the Bill. It is not unreasonable to say that there should be a judgment about the actions of a Minister in terms of timeframes. As we have understood in this House on many occasions, the summer can often be extended into the autumn without the blink of an eyelid.

Photo of Lord Judge Lord Judge Judge

Without this amendment, we are leaving a recipe for lethargy, which is inappropriate. We need it so that the court will get hold of the complaint, if one is needed, as soon as practicable.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank the noble Lord, Lord Pannick, and the noble and learned Lord, Lord Judge, for tabling this amendment, and I thank other noble Lords for their contributions. Perhaps I will disappoint the noble Lord, Lord Pannick, somewhat by saying that I agree with the substance and constructive nature of the proposal before us. When the noble Baroness, Lady Northover, started talking about “shortly” and so on, I was reminded of my time as the Aviation Minister and the occasion when an announcement on Heathrow Airport was pending—but we got there.

In that mood, let me outline the Government’s position on this amendment. When a request is received from a designated person to vary or revoke their designation, the appropriate Minister should ensure that they make their decision as soon as is reasonably practicable. As sanctions are applied without giving those sanctioned the opportunity to make representations, and because they have serious consequences on the individuals concerned, it is important to ensure that mistakes are rectified swiftly.

As sanctions are intended to change behaviour, it is also important that people should be able to have their designation revoked if they change their behaviour. Clause 19 therefore provides a quicker and less costly option than going to court. It will also have the advantage of keeping unnecessary pressure off the courts and potentially reducing costs to the taxpayer. The reassessment process exists to allow designated persons to seek swift redress when wrongly designated—and I can assure noble Lords that the Government fully intend to act promptly to requests for reassessments.

I shall certainly reflect on the amendment. I have listened carefully to noble Lords, who have made a compelling case for us to look at our position. With the assurance today that we will look at the amendment again—although it is only an assurance at this juncture—I ask the noble Lord, Lord Pannick, to withdraw his amendment.

Photo of Lord Pannick Lord Pannick Crossbench

I am grateful to the Minister. I look forward to hearing from him before Report that the Government are able to move on this matter. He has heard the views that there is no basis for not including this in the Bill. I hope this is the first of many amendments today that he will see the wisdom of. On that basis, I beg leave to withdraw the amendment.

Amendment 54 withdrawn.

Amendment 55 not moved.

Clause 19 agreed.

Clause 20: Periodic review of certain designations

Amendment 56

Moved by Lord Pannick

56: Clause 20, page 16, line 43, leave out “3 years” and insert “1 year”

Photo of Lord Pannick Lord Pannick Crossbench

Again, this amendment is in my name and the names of the noble and learned Lord, Lord Judge, and the noble Lord, Lord Collins of Highbury. It concerns the periodic review provisions in Clause 20. The appropriate Minister is required to consider any designation of a person every three years. That is far too long a period given the gravity of the consequences of designating a person. It is true, as the Minister emphasised at Second Reading, that the listed individual can seek a review under Clause 19, but subsection (2) of that clause provides that once such a request has been made, no further request may be made by the individual unless,

“there is a significant matter which has not previously been considered by the Minister”.

There may well be cases where, although the individual can point to no significant new material, the Minister, on reviewing the matter, may find good reason to vary or revoke the designation. Indeed, the passage of a year without any further material coming to light may justify looking again at whether the listing is appropriate. The three-year period is especially troubling because of the grave consequences of listing for the person concerned and because, as I said in the earlier debate today, you cannot start court proceedings under Clause 32(1)(d), to be read with Clause 33(5), until you have sought a review by the Minister and received a decision on that review.

The Minister will confirm that under the EU system, which this Bill is designed to replace, a periodic review occurs every six months normally but certainly in all cases at least every year. I can see no justification for this Bill to triple the period which can elapse before a review is required. I beg to move.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

The noble Lord, Lord Pannick, was eagle-eyed as ever, and this issue came up at Second Reading. He now brings forward this amendment with other noble Lords, and we support them.

The point here is that the review period for designations would not occur after one year but only after three. As the Minister said on Second Reading, it could happen earlier, but of course it does not have to. I also note that, on Second Reading, the Minister said that he did not regard the period proposed by the Government as excessive. He did not answer the point that this was a detrimental change from the position should we stay in the EU. I expect that he has now had time to consult on that and—if you like—to recognise that the writing is on the wall and, I hope, to persuade his colleagues that this cannot stand.

There is no reason for the frequency of reviews to change from one year, as now in the EU, to three years. I hope and expect that the Minister will find that this is one straightforward area in which to concede. After all, it has always been said that if we were to leave the EU, no protections or rights of UK citizens would be diminished. This is a case in point.

I raise one other issue, which I think has been flagged to the Bill team. This is, again, from the Law Society. It is concerned that UK courts should have the jurisdiction to hear wrongful listings in the case of UN listed persons. It points out that the Bill does not require or permit a UK court to quash a wrongful listing for a person who is UN listed and can only ask the Government to use their best endeavours to secure a de-listing in the UN. It recommends that the Bill directly transpose into UK law—

Photo of Lord Pannick Lord Pannick Crossbench

I am sorry to interrupt, but that is the specific subject of Amendment 62, to which we are coming. I do not wish to inhibit the noble Baroness, but she may wish to be aware of that.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

I did not spot that point. In that case, I will wait until we get to it. I hope that the Bill team will have taken it on board, both from the amendment submitted in the noble Lord’s name and, indeed, from what we sent through.

Photo of Lord Judge Lord Judge Judge

My Lords, I had thought of saying something but while the Minister, unlike Richard III, is in the giving mood I do not want to discourage him.

Photo of Lord Lennie Lord Lennie Opposition Whip (Lords)

My Lords, we have heard, and the noble Lord, Lord Pannick, has repeated the gravity of the consequences of sanctions on the lives of individuals and dependants upon them. Three years is a very long time, particularly if the designation is wrong or if behaviour has changed and they are now compliant. Therefore, we ask that the three years be reviewed and replaced by one year. It cannot be left for a length of time without a review taking effect. The Minister has the right to review. The individual has only one possibility of an application review. Therefore, we ask that this become automatic in the Bill.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank the noble Lord for tabling this amendment. The noble and learned Lord, Lord Judge, sat down before making a further point. I was reminded not of Richard III but of Oliver Twist, who wanted “more”.

On this particular point, Clause 20 is one of a number of safeguards, as I am sure noble Lords have seen, within the Bill that provides for designated persons and requires the Government regularly to conduct a thorough re-examination of designated decisions. The Government must, as we have heard from noble Lords who have spoken through this short debate, conduct this review at least every three years. The noble Lord, Lord Pannick, has rightly raised the issue, and I accept the point, that the EU carries out reviews more frequently. However, Clause 20 should be considered as part of a system of safeguards that the Government have built into this Bill which I believe will provide at least an equivalent, and in some respects greater, level of protection to that afforded to individuals designated by the European Union.

First, a designated person can request a reassessment of their designation whenever they so choose. Whenever that same person has new information to present in their defence or their circumstances change, they may request a further reassessment. The Government will consider such requests promptly. The closest equivalent process in the EU can take many months, as I am sure noble Lords are aware, due to the need for decisions and documents to be agreed unanimously by all 28 member states.

Secondly, designated persons can challenge in court on judicial review principles.

Thirdly, a Minister may instigate a reassessment at any time—for example, if new information becomes available to the Government, including revocation of a designation by one of our international partners. The decision to designate would not be made for an indefinite period. Rather, sanctions would be actively managed, and the Government would be under an obligation to revoke a designation if it no longer met the legal threshold.

Fourthly, the Bill mandates a broader political review of each sanctions regime at least once a year. This will shine a spotlight on the overall dynamics in the same way as the EU’s annual reviews and provide impetus for Ministers to use the power I have just mentioned to instigate a reassessment of designations that may no longer meet the threshold given the passage of time.

The review mandated by Clause 20 is intended as a final protection in case a designation has not been actively considered for a considerable period. The three-year timeline is in line with current Australian practice. The US, Canada and others do not carry out such reviews. While I accept that the EU reviews are more frequent, the process—which I have looked into—is relatively light-touch: designated persons are invited to present new information and member states are given a similar opportunity to make observations. It is then up to each member state to decide how actively to engage in such reviews.

The process envisaged in Clause 20 would be a more substantial exercise than the EU review. It would accordingly take a great deal of time and resource, which would have to be diverted from other work. It would also risk cutting across ongoing court challenges and add further and unnecessary complexity to that litigation. Requiring this exercise to be run every year would hold the UK to a higher standard than our international partners and is, we believe, unnecessary given the wider procedural protections I have outlined.

Therefore, on the basis of the explanation I have given—

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs) 5:00 pm, 29th November 2017

In the Explanatory Notes accompanying the Bill, it is mentioned that sanctions apply to about 2,000 people. That does not seem a huge number of people where one might need to make this kind of assessment.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

I am not quite sure what the noble Baroness’s question is.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

The Minister was saying that this was very onerous. I am aware that there is discussion elsewhere in the Bill of immigration status conflicting with those who have had sanctions imposed upon them. Obviously, when one is dealing with immigration status, one is dealing with very many people, but the point made in the Explanatory Notes is that one is not dealing with a large number of people here or a large number of sanctions provisions.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

I think I understand the noble Baroness’s question, but, notwithstanding the issue of numbers alone, Clause 20 lays out a process which the Government perceive to be more efficient than that currently adopted by the EU.

Photo of Lord Pannick Lord Pannick Crossbench

My Lords, I thank the Minister for his response. It is disappointing. I am not persuaded. As the noble Baroness pointed out, a limited number of people are involved here, and surely the time and the resources are justified by the significance of the sanctions imposed. It is right and proper that sanctions of such significance should be reviewed more often than every three years.

The Minister says that that the individual can seek a review, which is right, but the individual can do so only if there is a significant matter known to the individual not previously considered by the Minister. There may well be material in the files available to the Government which is not known to the individual. The Minister says that the individual can go to court, but it is the same under the EU system: you can go to court but the whole point of the Bill is to encourage court procedures as a last resort.

The Minister’s other point was that there is a sanctions review every year, but as I understand it—the Minister will correct me if I am wrong—that is not a review of individual cases but a review of the structure of the system, so for my part I do not see that that adds to the debate.

I will reflect on what the Minister has said, and I hope that he will reflect on this debate before Report, but we may well come back to this on Report. For the moment, I beg leave to withdraw the amendment.

Amendment 56 withdrawn.

Amendment 57 not moved.

Clause 20 agreed.

Clauses 21 to 25 agreed.

Clause 26: Review by appropriate Minister of regulations under section 1

Amendment 58

Moved by Lord Collins of Highbury

58: Clause 26, page 19, line 10, at end insert—“( ) No later than six months from the date of completion of a review under subsection (1), the appropriate Minister must lay the findings of the review before Parliament.”

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

My Lords, when we had discussions with the Minister prior to Second Reading and just after, the review of the regulations cropped up on a few occasions, the justification being that some of these new powers and regulations would not be subject to primary legislation. In those discussions, I asked, if you are reviewing in government, who tests and scrutinises that review? This is the first Brexit Bill and we have heard on many occasions that Brexit is an opportunity, or an obligation, to bring powers back to the United Kingdom. If that is the case—I do not necessarily agree—and the Minister supports it, this is an opportunity for him to support the principles of these amendments, which are about ensuring that powers taken by the Executive are subject to proper scrutiny, and that the Executive are held to account by Parliament.

Amendment 59 sets out the details and asks, how do we do that job? What are we measuring? But if there are issues and the Minister says, “I cannot have this list because there are things in it that may be subject to national security, or other things that cannot be disclosed”—the Government seem to have a habit of not disclosing information to Parliament on matters relating to Brexit—I would be more than willing to consider those concerns and take them into account. Obviously, if there are issues with the list then the minimum standard that I am arguing for is Amendment 58. I do not think it unreasonable that if the Government are taking these powers, we should be able to hold them to account in any possible review. I know the Minister will say that regulations are subject to consideration by Parliament, et cetera, et cetera, but that is not the scrutiny we want to see here. I hope that if the noble Lord is able to continue in his giving mood, he can give us some positive words about how Parliament will be able to hold the Executive to account.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

My Lords, these amendments in the name of the noble Lord, Lord Collins, helpfully make much clearer the commitments that Ministers must make to review the regulations they have put in place, giving a time by which this must happen and more detail on what they should include. They would, indeed, as the noble Lord has indicated, make these reviews more transparent and accountable and we are happy to support them.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, they say that generosity defines the spirit of a person, so perhaps I can be slightly more generous than noble Lords may perceive. The noble Lord, Lord Collins, is quite correct: we have talked about this issue, and sanctions, we all accept, can be an effective tool of foreign policy and national security, but I also accept that they can have serious implications, not only for those directly designated but also for businesses and charities operating in particular areas.

Foreign policy priorities can change frequently. It is therefore important that Ministers regularly revisit the decision to apply sanctions regimes to political problems and security challenges, and also consider carefully whether the sanctions are having the intended purpose, whether there are unintended consequences and what adjustments might be needed to achieve the desired effect.

Clause 26 therefore requires the Government to carry out a political review of its sanctions every year. The EU also carries out annual reviews of its sanctions regimes. The purpose here is to consider whether the sanctions should continue unchanged or be amended. If there is a published outcome, it is simply confirmation that the legal Acts have been renewed or amended. We have in mind a similar model for the UK; the annual review would be mainly an internal policy exercise, rather than a report for external publication. If the Government decided as a result to amend the sanctions regulations, this would involve a process of parliamentary scrutiny through which we would set out the rationale. Of course, the Government would always respond to Parliamentary Questions about specific areas of policy through the usual channels.

That said, I have listened very carefully to the noble Lord, Lord Collins, and we are looking at the amendment specifically. I will reflect on the proposal in that regard. He made the helpful suggestion that, between Committee and Report, we meet again to work out some of the perhaps necessary parameters. I know he appreciates national security issues and other such issues. I hope, with the assurance that we will reflect on his proposal, the noble Lord is minded to withdraw his amendment.

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

I thank the Minister. I am going to take that as his continued giving mood and I certainly would welcome a meeting. If you are going to have a political review, I do not see how it can be limited to the Executive; Parliament needs to be involved. I therefore welcome his comments and, in light of them, beg leave to withdraw the amendment.

Amendment 58 withdrawn.

Clause 26 agreed.

Amendment 59 not moved.

Clause 27: Procedure for requests and reviews

Amendment 60 not moved.

Clause 27 agreed.

Clauses 28 and 29 agreed.

Clause 30: Rights of person on EU sanctions list

Amendment 61 not moved.

Clause 30 agreed.

Clause 31 agreed.

Clause 32: Court review of decisions

Amendment 62

Moved by Lord Pannick

62: Clause 32, page 23, line 16, at end insert—“( ) For the avoidance of doubt, in relation to a decision under subsection (1)(c) above, the court has power to set aside the designation if satisfied that it is in breach of the principles applicable on an application for judicial review.”

Photo of Lord Pannick Lord Pannick Crossbench

This amendment is in my name and the names of the noble and learned Lord, Lord Judge, and the noble Lord, Lord McNally. It is concerned with persons who are designated in this country because they have been placed on the UN sanctions list. It raises a very troubling rule-of-law issue, to which the noble Baroness, Lady Northover, referred in one of our earlier debates this afternoon.

Clauses 21(2) and 21(4) provide that a person who is designated here because they are on a UN list may request the Secretary of State to use best endeavours to secure that their name is removed from the UN sanctions list. My concern is that what Clause 32 means —and indeed is intended to mean—is that, in relation to such a case, a court in this country has no power other than to overturn a decision of the Secretary of State not to use such best endeavours, and to ask the Secretary of State to use best endeavours at the UN. What the Bill appears to deny the person concerned is the right to say to the court: “I have been listed in this country—designated in this country—because I am on a UN list. But I am on a UN list as a result of procedural unfairness, as they have never told me why I am listed, or as a result of a substantive defect. There is no basis whatever for my listing, therefore the court in this country should quash the domestic designation”.

After Second Reading, the Minister said in his letter to me, which was circulated to other interested noble Lords, that our courts cannot be given a power to quash the domestic listing because this country has an international obligation to designate where a person is on the UN sanctions list. I have three responses to that.

First, we are considering domestic law powers to designate. No one should be designated in this country if our courts are satisfied that the designation is as a result of an unfair or unjustifiable decision. In those circumstances, the Minister cannot shelter behind the decision of another person, whoever they may be, in order to deny justice to the person affected in this country, especially given the gravity of the consequences for that person of a listing in this country. In my view, it is simply unacceptable that persons who are subject to a designation order in this country should be denied an effective judicial remedy in this country, however defective they can show the designation to be. That is unacceptable, and for the Bill so to provide is a flagrant breach of the rule of law.

Secondly, Clause 32 denies any effective judicial remedy in this country because of listing by the UN. I cannot be persuaded that the rule of law in this country should be subcontracted to the United Nations. This is, noble Lords will recall, the organisation which earlier this year voted Saudi Arabia on to its Commission on the Status of Women—a body which is,

“dedicated to the promotion of gender equality and the empowerment of women”.

This body, the UN, decided last week that there was no room for Sir Christopher Greenwood on the International Court of Justice. He failed to win reappointment after a most distinguished nine-year term, for reasons which had nothing to do with the international rule of law and everything to do with the popularity of a former Lebanese ambassador to the United Nations and the political attraction of an Indian candidate.

I know the Minister is well aware of the circumstances, so I think he will understand that I cannot accept that the rule of law in this country should be subcontracted to a body which displays such ignorance of the international rule of law. The nations of the United Nations are not united on the importance of the rule of law. We cannot deny remedies in this country in the hope that justice will be done at the international level.

Thirdly, despite the international law obligations of European states, including the United Kingdom, the Court of Justice in Luxembourg is prepared in an appropriate case to set aside a listing based on a UN listing, where such a listing breaches legal standards. Indeed, I would suggest that the very best way to ensure that UN listings are legally robust is for the courts of this country to have the power to quash a domestic listing based on a UN listing.

I say to the Minister that the amendment raises a fundamental issue of the rule of law. The Bill should not deny our judges the power to quash, where appropriate —and I hope it will rarely if ever be appropriate—a designation that is based on a defective UN listing. I beg to move.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs) 5:15 pm, 29th November 2017

My Lords, Amendment 62 is partly in the name of my noble friend Lord McNally. I knew he would not be able to be here, and he sends his apologies for that. I have to say that I read the amendment and the clause a number of times and it seemed to me that the amendment tightened and clarified the clause. What I failed to spot, as a non-lawyer, was what lay underneath it. I am extremely glad that the issue I raised earlier has been so effectively explained by the noble Lord, Lord Pannick. I again express support from these Benches for what he has said.

Photo of The Bishop of Chester The Bishop of Chester Bishop

My Lords, if I heard the Minister correctly, he compared the noble Lord, Lord Pannick, to Oliver Twist asking for more. I wonder, having heard the noble Lord, whether the Minister would agree that Oliver Twist had right and justice on his side.

Photo of Lord Brown of Eaton-under-Heywood Lord Brown of Eaton-under-Heywood Chair, Sub-Committee on Lords' Conduct

My Lords, I support the amendment. I recognise that it is not an entirely simple point; it is not perhaps as straightforward as some of the amendments with which we dealt earlier. I see the force of the Government’s argument that the UK has no alternative under international law but to give effect to our obligations under the UN charter; indeed, Article 103 of the charter expressly dictates that these obligations prevail over any conflicting international law obligations. In the 2010 Supreme Court case of Ahmed, I ended my dissenting judgment with the hope that the majority view would not be thought to indicate any weakening of our commitments under the charter. In Ahmed, however, I also stressed the draconian nature of these orders. I said:

“The draconian nature of the regime imposed under these asset-freezing Orders can hardly be overstated … they are scarcely less restrictive of the day-to-day life of those designated (and in some cases their families) than are control orders. In certain respects, indeed, they could be thought to be even more paralysing”.

It strikes me as highly relevant to the amendment that in the case of Ahmed the Court of Appeal had held—and before the Supreme Court Treasury counsel for the Government argued this in terms—that orders implementing a UN resolution are reviewable, and that on such a review the court can grant relief directed against any UK public authority, not against the United Nations. That, essentially, is what the amendment seeks to achieve, or at least to clarify.

I note not least that one of the team of counsel instructed for the Government in the Ahmed case was Sir Michael Wood, who had been the senior legal adviser to the FCO. Clearly he had seen no insuperable obstacle to the court having this judicial review jurisdiction—the very thing that the amendment seeks to put beyond doubt that the court has. On balance, therefore, my concluded view is that we can and should make plain that the court will have this jurisdiction.

Photo of Lord Judge Lord Judge Judge

My Lords, my name is attached to the amendment. I shall not repeat what the noble Lord, Lord Pannick, had to say. The issue is simple: we must honour our obligations to the United Nations but if, having honoured them, there is an injustice, we must provide a remedy.

Photo of Lord Lennie Lord Lennie Opposition Whip (Lords)

My Lords, I had not realised that there would be quite such a debate on the application of the rule of law, but I am now aware that it is an important matter. When a sanction’s designation is in place, and a review has been requested but denied by a Minister, the court here will have the authority to set aside the designation if the Government are found in breach of the applicable principles. That is entirely appropriate and sensible. I support the amendment.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank the noble Lord for tabling the amendment and all noble Lords for their contributions.

I agree that appropriate remedies for designated persons are vital, but the Bill achieves this. However, since some noble Lords have mentioned comparisons with other systems of challenges—there was reference to the EU—it is worth emphasising how this Bill has been designed to reflect the current procedural protections for designated persons that exist in the European Union.

As the noble Lord acknowledged, I stated at Second Reading that the proposed threshold of “reasonable grounds to suspect” for designations is the same standard that the UK currently uses when considering designations at the EU and the United Nations. It is broadly equivalent to the threshold applied by EU courts. The Bill then provides a system for reviews and reassessments. Where those lead the appropriate Minister to decide that designation is not appropriate, they must take remedial actions. As I indicated in a previous debate, these provisions provide at least an equivalent level of protection to that afforded to individuals designated by the EU.

I agree with the noble Lords that designations should be put in place and maintained by the United Nations only if there is a sound basis to do so. I can assure all noble Lords—the noble Lord, Lord Pannick, in particular—that, as a permanent member of the UN Security Council, the UK makes this point consistently. The Bill provides a route for persons designated by the UN to bring a challenge in UK courts. As the noble Lord stated, if the court finds that the decision of the Secretary of State not to use best endeavours to secure an individual’s delisting at the UN is unlawful, the court may order the Secretary of State to do so.

However, as the noble and learned Lord, Lord Brown, also pointed out, this matter is slightly more complex. As a member state of the UN, we are legally bound to implement decisions of the United Nations Security Council taken under Chapter VII of the charter. If a person has been designated by the UN, the UK is bound by international law to maintain sanctions against the person unless and until the UN Security Council agrees to remove this designation. Again, as the noble and learned Lord pointed out, as set out in Article 103 of the UN charter, these UN obligations take precedence over obligations under any other international agreement, such as those in the European Convention on Human Rights.

I recognise that in the past—as the noble Lord, Lord Pannick, referred to—the EU court has occasionally made rulings striking down EU designations in place to implement UN sanctions. The UK’s position has consistently been firmly that it should not do so and the UK has made this point in submissions to the EU courts in the Kadi case. The EU courts adopting this approach does not change our analysis of the position. The EU is not a signatory to the UN charter and is therefore not bound by its terms—we are. It is not correct to say that this will leave a person in the UK in a worse-off position than a person in another EU member state. All the other member states of the European Union are also signatories to the UN charter, and are bound by it. If there is no EU law in place to implement a UN designation, those countries would need to take alternative steps, for example under their own domestic law, to remain in compliance with their UN obligations. The noble and learned Lord, Lord Brown, has just reflected that we have done this in the UK in the past. When, in 2010, the Supreme Court in the case of Ahmed ruled that an order putting UN counterterrorist sanctions in place was ultra vires, we created domestic legislation—the Terrorist Asset- Freezing etc. Act 2010 to ensure that the UN sanctions remained in place.

If the UK were to unilaterally cease to implement a designation mandated by the United Nations, the UK would be acting in breach of its highest obligations under international law. The Bill needs to reflect this reality, which I am sure noble Lords appreciate. The appropriate way to deal with UN designations that should no longer be in place is by taking action at the United Nations. The Bill recognises this in the power it provides the UK courts to direct the best endeavours of the Secretary of State. While it is not in the UK’s gift to secure a UN delisting, this provision would have a significant political effect. It would compel a permanent member of the UN Security Council to seek to secure delisting.

I have listened very carefully to the noble Lord, but I hope equally that he has listened carefully to my response, and I hope he is minded to withdraw his amendment.

Photo of Lord Pannick Lord Pannick Crossbench 5:30 pm, 29th November 2017

I am grateful to the Minister. I have listened carefully, but I am not persuaded. The Minister is telling the Committee that however strong the individual’s case that his or her designation is unfair as a matter of procedure and substance, there is nothing that the English courts can do except ask the Secretary of State to use best endeavours at the United Nations, which the Secretary of State may already have done. What happens if the UN’s response is that it will maintain the designation and the English court is still satisfied that there is no basis for including this person on the list? There may be no evidence that justifies it; it may be a rank breach of fairness.

I am not satisfied, as I said, that we should subcontract these matters to the United Nations. I can well understand that the English court would be very slow to form the view that it should take the step of quashing the domestic designation when the United Nations has imposed internationally such a designation, but I cannot accept that the English court should be left without power to do so if it believes that injustice has been done, given the grave consequences for the individual concerned. I will reflect further on this, and I hope the Minister will reflect further before Report. If not, we will need to return to what, as the noble and learned Lord, Lord Judge, said, is a simple matter but also a fundamental matter of the rule of law. For the moment, I beg leave to withdraw the amendment.

Amendment 62 withdrawn.

Clause 32 agreed.

Clauses 33 and 34 agreed.

Clause 35: Suspension of prohibitions and requirements

Amendment 63

Moved by Lord Collins of Highbury

63: Clause 35, page 26, line 16, at end insert “but any such period may not exceed 12 months”

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

My Lords, this group of amendments is focused on a subject matter that we repeatedly return to: namely, parliamentary accountability and scrutiny of the actions of the Executive. I want to focus primarily on how we enable Parliament to do the job of scrutiny. Amendments 65 and 68, in particular, are designed to ensure that there is relevant information in relation to actions to revoke or introduce regulations. I know that the Minister will say that because regulations will be placed before Parliament there will be a scrutiny function there—but I think more than that is needed. We say that an affirmative decision is required, and also that the reasons should be clearly stated and set out in a written memorandum by the appropriate Minister. So the theme that we are returning to, and focusing on, is enabling Parliament to scrutinise, and giving it the tools to do that job.

There is a power under Clause 35 for an appropriate Minister to suspend regulations “for a specified period” —no period being specified, of course, because that is subject to regulations. I keep coming back to the fact that, in the exercise of powers, it is important to put certain principles on the face of the Bill. We would insert a requirement for the time period to be put in. We must understand that the power of the Executive to suspend regulations or other sanctions has the potential to cause compliance uncertainty for business. There could be uncertainty about when and on what terms a sanction may be reimposed, or whether it could be revoked entirely.

The purpose of the amendment is to create more certainty for all those involved, and by doing so to introduce more effective compliance with sanctions. Considering the aims of those sanctions, that is very important. The persons or entities that are subject to suspended sanctions may still be affected by reputational stigma. It is important, in terms of procedural fairness, that these issues should be properly addressed.

The group is focused primarily on parliamentary scrutiny and enabling Parliament to do that job effectively, and I have also put my name to Amendment 72, to Clause 44. I look forward to the contribution from the noble Lord, Lord Pannick, on that. In my opinion that clause gives the Executive an overwhelming power, which the Minister will have to give very good reasons for retaining. I beg to move.

Photo of Lord Pannick Lord Pannick Crossbench

My Lords, the noble Lord, Lord Collins, mentioned Amendment 72, which is in my name and his, and in those of the noble and learned Lord, Lord Judge, and the noble Baroness, Lady Northover. It concerns Clause 44(2), which is a very broad Henry VIII clause. As the noble and learned Lord, Lord Judge, repeatedly argued during earlier debates in this Committee and elsewhere, we should not be giving Ministers powers to amend primary legislation without very strong justification. Clause 44(2) would allow Ministers to take action,

“amending, repealing or revoking enactments”,

including primary legislation,

“(whenever passed or made)”.

It contains no limitations on those powers. For my part, I cannot see any justification for including such extensive powers in the Bill. I strongly suspect that such a provision is included simply because it may turn out to be useful at some time in the future. We in this House are seeing too regularly provisions of this sort and we ought to take a stand against the conferral of such sovereignty on Ministers.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

My Lords, the noble Lord, Lord Collins, is once again trying to help the Government, and I appreciate his efforts. He seeks to put a very useful time limit on how long a so-called “specified period” in Clause 35 might be, and his Amendment 64 proposes a further time limitation. We will come back to Clause 35 when we discuss the next group of amendments and I shall address that clause as a whole shortly.

Amendment 65 in the name of the noble Lord, Lord Collins, seeks to check the wider and unspecified powers on the revocation of sanctions that the Government seem to want to grant themselves in Clause 38. We do not want to see wide and untrammelled powers in either the setting or the revoking of sanctions. The noble Lord is right to seek to address this.

My name is, indeed, attached to Amendment 72. The case for this amendment was very cogently argued by the noble Lord, Lord Pannick. The clause contains one of the wide-ranging Henry VIII powers that we have seen elsewhere in the Bill. I cannot see how this power can stand. Clause 44(2) states:

“Regulations under this Act may make supplemental, incidental, consequential, transitional or saving provision”.

That is a rather wide-ranging description. Therefore, I trust that the Minister has been given enough leeway by his colleagues across government to think again.

Photo of Lord Judge Lord Judge Judge

I will not add very much, but I am beginning to think that there is a computer in every department which produces a Henry VIII clause at least once in every Bill. That is what we have here. This is not belt and braces; it is belt, braces and Henry VIII’s great big heavy boots. We do not want it.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

The noble and learned Lord made me imagine Henry VIII’s boots for a moment.

As regards thinking, I am forever thinking; I think it is a good thing to do. The Government are reflecting very carefully on all elements of the arguments noble Lords are putting forward on these amendments. I will say at the outset that I can see that a number of these amendments gather around a central theme—namely, the appropriate roles of Parliament and the Government when creating and implementing future policy on sanctions. I assure noble Lords that I recognise that this is a difficult balance to strike. As power flows back to the United Kingdom from the European Union —I say to the noble Baroness, Lady Northover, that it is a case of “when” we leave the EU—it will not be appropriate to simply follow the model in the European Communities Act 1972, where decisions of the EU either apply directly in UK law or are implemented through statutory instruments following the negative procedure.

I assure noble Lords that we have tried hard to strike the balance correctly in this Bill and ensure that Parliament has the right level of oversight of the Government’s exercise of sanctions policy. For example, we have ensured that the UK autonomous sanctions regulations must be approved by Parliament before they are put in place. I continue to listen very carefully to the points that have been made about the need for proper parliamentary scrutiny. I assure noble Lords that I will continue to reflect on those points—and not just in respect of these amendments.

It is perhaps worth remembering that sanctions are, in essence, as I have said repeatedly, a matter of foreign policy and national security, which fall more to the Government than Parliament. This was recognised by the great constitutional lawyer A V Dicey, who wrote that the “right of making treaties” was,

“left by law in the hands of the Crown, and are exercised in fact by the executive government”.

That is also the practice in other western countries with national sanctions regimes and legislation, such as Canada and Australia.

On the amendment we are discussing, it is important to recognise that the imposition of sanctions is not a punishment but an attempt to change the behaviour of those who are acting in a threatening or unacceptable manner. That is why the provisions provide ways of suspending, amending and revoking sanctions. Iran is an example of where sanctions have been suspended. Under the 2016 nuclear deal, Iran sanctions can be “snapped back” by the EU if there is a breach of the international commitments made by Iran in relation to nuclear development. Noble Lords will be aware that those suspension arrangements were part of a delicate political balancing act, which the UK is working hard with the EU and other partners to preserve.

Amendments 63 and 64 seek to change the proposed procedures for approving the suspension of regulations. They would allow the Government to suspend regulations by procedures already outlined in the Bill for three 12-month periods. To suspend for more than three 12-month periods would require approval via the draft affirmative procedure. The proposed 12-month period for suspensions would not be suitable in all cases. It would restrict the ability of the Government to use their discretion on how long sanctions should be suspended to encourage improved behaviour. As it stands, the Bill allows the Government to determine the period of suspension, tailored to specific circumstances, including international commitments, such as those under the Iran nuclear deal. A yearly review and triennial vote may force the Government to publicly intervene in a way that may not be conducive to facilitating the improved behaviour that sanctions ultimately aim to achieve.

Amendment 64 would require any suspension to be approved after three years via the draft affirmative procedure. While recognising the importance of parliamentary oversight, the Government disagree with the amendment. As the Bill stands, regulations that suspend sanctions are subject to the negative procedure. Suspending sanctions lifts the prohibitions that impact on designated persons; that is one reason why we do not think that suspension justifies the higher level of scrutiny attached to creating sanction measures in regulations. In addition, the Government will be able to act more nimbly and confidently in international negotiations if the express approval of Parliament is not required to suspend sanctions.

Turning to revocation and the amendment of regulations, I recognise that these decisions merit close scrutiny, based on a careful assessment of whether the sanctions have achieved their political objective. Amendments 65, 67 and 68 seek to subject the revocation of sanctions to the draft affirmative procedure, as well as obliging the Government to submit, alongside any regulation revoking sanctions, a written memorandum setting out the rationale of the original purposes of sanctions, as outlined in Clause 1. While agreeing with the principle of parliamentary scrutiny, I believe that the Bill as drafted provides the appropriate mechanisms.

Turning to UN sanctions, revocation would be an automatic response to a decision of the UN Security Council. Subjecting this to a draft affirmative procedure would introduce unnecessary delay and create doubt over whether we would fulfil our international obligations. In turn, this could complicate the international diplomacy necessary to secure changes of behaviour by those subject to UN sanctions, as I have already indicated with an example.

In the case of UK autonomous sanctions, the regulations could be revoked only by using the “made affirmative” procedure, allowing parliamentary oversight. To subject revocations in UK autonomous regimes to the draft affirmative, rather than “made affirmative”, procedure would slow down the process and potentially prevent us from acting in tandem with our allies. Given that revocations have only positive effects on the individuals concerned, we believe that this is an appropriate level of oversight and allows for sufficient flexibility and international co-ordination.

Amendment 72 would remove from the Bill the power to make certain modifications to existing primary and secondary legislation through regulations made under the Sanctions and Anti-Money Laundering Bill. Instead, future amendments to primary legislation would also need to be made through new primary legislation.

I recognise the concern in your Lordships’ House about the breadth of the regulation-making powers conferred by the Bill. The issue came up both at Second Reading and in Committee. But I hope that I can reassure noble Lords that the scope of the power in Clause 44(2) is limited: it can be used only to make provisions that are consequential, supplemental or incidental to the sanctions, and cannot be used for any changes to legislation that are independent of those sanctions or are not necessary to enable the sanctions to function. It does not give the Government a free hand, but rather confers on them a tool to make small changes that are necessary to make the main sanctions work.

However, I would like to explain one of the purposes for which this subsection has been included. On our departure from the European Union, all EU regulations, including those that implement sanctions, will be incorporated into UK law through what will become the European Union (Withdrawal) Act. This subsection provides the Government with the power to revoke EU sanctions regulations at the moment when we create our own UK sanctions regulations to take their place. It will, in our mind, provide legal clarity in this area by removing overlapping laws. It will also allow amendments to be made to other Acts of Parliament, but only where this would be needed to ensure that the UK sanctions regulations work properly. Inclusion of this power will help to ensure a smooth transition and avoid the lengthy delays that might be involved in handling all of this through primary legislation. There are good precedents for this approach. Just as an example, I refer noble Lords to Section 85 of the Serious Crime Act 2015.

In line with the recommendations of the Delegated Powers and Regulatory Reform Committee, any regulations made which use this targeted power must be made under the draft affirmative procedure, so any proposed changes would not come into effect unless and until both Houses have given their assent. I have spent some time giving a detailed outline of the Government’s position and I hope that, with that explanation, noble Lords will be minded not to press their amendments.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour 5:45 pm, 29th November 2017

I thank the Minister for his detailed explanation. Does the Henry VIII power in Clause 44(2) allow the Government, by regulations, to remove protections that an individual has under other primary legislation in relation to sanctions, for example under the Human Rights Act 1998?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My understanding is that the regulations would apply only to the sanctions themselves, but I shall clarify that legally as well in answer to the noble and learned Lord and return to the specific issue on Report.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour

Will the Minister write to me, so that we know the Government’s position before Report?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

Perhaps I was not clear: that was exactly my intention. I do not want to say something from the Dispatch Box that is not accurate, so I will write to the noble and learned Lord on that particular point.

Photo of Baroness Sheehan Baroness Sheehan Liberal Democrat Lords Spokesperson (International Development)

I am a little intrepid in saying this as I am not a lawyer or a constitutional expert but this seems to be a Bill that, from a lay man’s point of view, lets the Government give themselves great powers through the way it designates individuals, connecting persons through descriptions, through definitions of involved people and through clauses that give powers to amend. These include Clause 39, which gives power to amend all of Part 1 so as to authorise additional sanctions, and Clause 44(2), which gives sweeping Henry VIII powers to amend, repeal and revoke amendments and enactments. To me, this seems like Jekyll and Hyde legislation. You think you are getting one thing, yet there is every ability within the proposed Act to change itself into something quite different.

I was quite concerned in last week’s debate, when my noble friend Lady Bowles talked about how Acts could be used for unintended purposes. I recall the case of Maya Evans, who read out the names of 97 British soldiers during the remembrance ceremony at the Cenotaph in 2005. Although it was a very innocuous statement that she was making—she was protesting against Britain being taken into the Iraq war; she felt that it was illegal—she was arrested and was the first person in the UK to be convicted under the Serious Organised Crime and Police Act 2005. Also in the same year—I might embarrass the Labour Benches here—Walter Wolfgang was forcibly removed from the Labour Party conference. Again, he wanted to protest about the Iraq war, and shouted out “Nonsense!” and “That’s a lie!” during a speech made from the conference platform by Jack Straw. He was ejected and was stopped from re-entering the conference hall by a police officer citing the Terrorism Act.

From my point of view as a lay person, I am fully supportive of the well-informed noble Lords here who are leading the charge to make sure that the Bill does what it says on the tin and does not turn into a Jekyll and Hyde Bill.

Photo of Lord Pannick Lord Pannick Crossbench

Whether I am well informed or not, can the Minister confirm that in his response on Amendment 72 he gave a reassurance to the Committee that these powers would be used only when necessary? That was the word he used on more than one occasion. He will remember an earlier debate we had in this Committee on whether that word should be written into an earlier clause. If with the aid of parliamentary draftsmen “necessary” could be written in to confine the use of that power, it would mitigate substantially my concern about Clause 44(2); I speak only for myself. Perhaps the Minister and the Bill team could reflect on that before Report.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

To pick up on that final point, of course we will. I confirm that I used “necessary”. As regards the intervention from the noble Baroness, perhaps I did not quite follow her whole argument—various rules were in play—but I got the general principle that she was in support of the powers that are being conferred. As I said right at the beginning, laying it out in quite a lot of detail, I totally accept the point about the Henry VIII powers—the use of secondary legislation rather than primary legislation—which we have debated several times. Certainly, from our perspective as the Government—that is true not only of ourselves but of previous Governments as well—there is a point in principle that we try to strike a balance. Therefore I am listening carefully. On the specific point that the noble Lord made at the end, I will take that back and see how it can be adapted.

I am in reflective mode, as several noble Lords have noted during some of the earlier debates in Committee. However, on this group of amendments, I hope that after the explanation I have given the noble Lord will be minded to withdraw his amendment.

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

I agree with many noble Lords who have decided to come back to the Minister before he sat down. His response has been disappointing. These are clearly issues of principle that we will return to. I find it amazing that often, when the Minister gives examples of how difficult it would be to do X or Y, they do not appear that difficult. You can give a reason why sanctions need to be revoked. At the end of the day, whatever Crown powers or executive powers there are, the political reality is that these figures work when there is consent—when people buy into them. We are attempting to ensure that the Executive do not act with untrammelled powers and that they have to account for their actions and explain them. If Parliament then gives its support and consent, those actions and powers become more effective. That is what this debate is about today. We will certainly return to this issue on Report, but in the light of the comments the Minister made to the noble Lord, Lord Pannick, I beg leave to withdraw the amendment.

Amendment 63 withdrawn.

Amendment 64 not moved.

Debate on whether Clause 35 should stand part of the Bill.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs) 6:00 pm, 29th November 2017

My Lords, I was rather intrigued by the Minister’s definition of sanctions as being something little more than a gentle nudge. I found myself thinking about—

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

It is certainly not a gentle nudge. What I was alluding to is that the ultimate purpose behind sanctions is that they should not exist for an indefinite period of time. It is about changing behaviour. As I noted in the example that I gave of Iraq, there are times when we could use these to very good effect to ensure, with people’s behaviour—be they individuals, corporations or, indeed, countries—that sanctions act as an effective, and deterrent, tool.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

I am glad to have that further clarification. My eyebrows rather rose at that and I was wondering, speaking of what is benign, what my kids would have made of being sanctioned and having their PlayStations removed. They would not regard that as particularly benign. But, very seriously, it is quite striking how leaders around the world with sanctions on them strive hard to get them lifted, so I am glad to have that clarification.

I propose that Clause 35 does not stand part of the Bill. We have a series of such proposals through the Bill, as the Minister will be aware. We have had a wide-ranging discussion just now. I appreciate the efforts to improve things made by the noble Lord, Lord Collins. However, it still seems to us that this clause remains unacceptable, even if amended in the way that he proposed. That is why we propose that it does not stand part of the Bill.

Just as we wish to ensure that the imposition of sanctions is done in a way which is appropriate, transparent and accountable, so too should be the suspension of sanctions. No one here would wish to see the UK as a harbour for those not wanted elsewhere, but we must not give future Ministers the power to do that either. We feel that these powers are wide and vague, and bearing in mind that the secondary legislation coming down to us will include—as the noble and learned Lord, Lord Judge, pointed out last time—many things with which we would no doubt agree, which are then jeopardised should we take the very unusual action of voting down the SI, we need to read the Bill in that light. For example:

“The period begins when a specified condition is met and lasts for so long as the suspending regulations or a specified provision of those regulations has effect”.

That would catch a large number of things. Although the noble Lord, Lord Collins, sought to help the Government regarding the amendment we have just debated, we feel that the Government should think again over the whole clause.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, it is important to recognise that the imposition of sanctions is not just a punishment but rather an attempt—as I have articulated in relation to an earlier comment by the noble Baroness—to change the behaviour of those who are acting in a threatening or unacceptable manner.

I state clearly that Clause 35 on suspensions is important. It gives Ministers the ability to provide relief from sanctions to countries, organisations and, yes, individuals where there is evidence of positive steps towards the desired change of behaviour. The ability to suspend sanction measures, rather than fully lifting them, allows Ministers to recognise moves in the right direction while maintaining a credible threat that sanctions can be easily reimposed. We know from past experience that this is an option worth having; thus I believe this clause should stand part of the Bill. I hope the noble Baroness will accept the response I have given, which makes the point that the Bill, at its essence, through Clause 35 provides for the suspension of particular sanctions to ensure that those seeking to improve their behaviour are given an opportunity to prove it. This should be without having the immediate comfort of knowing that their sanction has been not only suspended but lifted altogether. Not having Clause 35 would prevent Ministers from having this very important tool available to impose that kind of suspension.

Clause 35 agreed.

Clauses 36 and 37 agreed.

Clause 38: Revocation and amendment of regulations under section 1

Amendment 65 not moved.

Amendment 66

Moved by Lord Collins of Highbury

66: Clause 38, page 27, line 4, at end insert—“( ) Regulations under section 1, which are made by virtue of this section for the purposes of revoking or substantially reducing the effects of sanctions regulations, must be accompanied by the publication of a written memorandum by the appropriate Minister, and such a memorandum must set out— (a) how the decision to amend or revoke the regulations in question is consistent with the overall foreign policy objectives of the UK government, including any specific regional objectives where appropriate;(b) the extent to which each initial objective of the regulations in question has been met, including any specific demands or expectations of any change in the behaviour of the target or targets of the sanctions; and(c) specific provisions for the reinstatement of the initial regulations, in the event that the conditions justifying their revocation or amendment no longer apply.”

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

My Lords, with this amendment I return to the principle of “tools for the job” and how we enable Parliament to scrutinise effectively. In the previous group, the Minister spoke quite effectively about the reasons for certain sanctions being introduced and how they sometimes underpin and support much broader foreign policy objectives, and he quoted the Iran situation. I did not think that he found that particularly difficult to do. We know that when sanctions are introduced—I come back to this point—we need political support and commitment for them to be effective. Without proper support, they will not be.

That is why it is important that, when the powers and regulations are introduced, we specify how the sanctions fit into the broader foreign policy objectives and why they are there. I fear that sometimes people jump on the sanctions bandwagon because they cannot think of any other action to achieve particular foreign policy objectives. For example, the struggle for human rights is difficult, and different leverages can be used. I do not necessarily think that sanctions are the first port of call, and I accept that they can be part of a suite of actions.

However, when we introduce sanctions, it is important and incumbent on the Government to set out clearly why they are there and how they fit into their overall foreign policy objectives. Furthermore, when will the sanctions be brought to an end and when will we judge them to have been successful? I have heard in this House on a number of occasions that sanctions have been “successful”. That is measured by whether we have stopped certain trade and a certain activity, not by whether they have achieved the foreign policy objectives set for introducing them, and that is what this amendment seeks to do. Once again, I hope that the Minister is in his listening and giving mode. I beg to move.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs)

My Lords, once again the noble Lord, Lord Collins, seeks to assist the Government by ensuring that some of the wide-ranging powers sought by Ministers have a little sunlight shone upon them. We support what the noble Lord has said about making the Minister’s actions more transparent and accountable, but we worry—the noble Lord, Lord Collins, has in some ways made reference to this—about the broad categorisation of foreign policy objectives in defining when sanctions are appropriate.

We discussed this issue on the first day of Committee and, although I realise that the noble Lord has carried over the aims as stated in the Bill, we feel that “foreign policy objectives” is too wide a concept. Clearly, if our foreign policy objective were, say, trade with India and we decided, for some reason, to put sanctions on Pakistan and, as described in the Bill, all those associated with that country—as, again, we debated on our first day in Committee—a large number of law-abiding citizens could potentially be caught up in that. That may be regarded as far-fetched, but we always have to look for unintended consequences, given that unexpected things happen in politics.

As we have said before, it is all very well the Minister potentially quoting the Human Rights Act or the European convention, given that some members of his party have spoken of repealing the first and withdrawing from the second. It is therefore important that we ensure that legislation is watertight. With that caveat, I commend the noble Lord, Lord Collins, for trying to assist us in making Ministers under this Bill more transparent and accountable.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank the noble Lord, Lord Collins, for tabling this amendment. I agree that sanctions are not the first port of call, a point I have made in previous debates in Committee. The amendment specifically deals with the decision to lift sanctions, and it merits close scrutiny based on a careful assessment of whether the sanctions have achieved their political objectives, as the noble Lord said.

The amendment seeks to oblige the Government to issue a written memorandum alongside any regulation revoking sanctions which would set out the rationale in terms of the original purposes of the sanctions as outlined in Clause 1. While I agree with the important principle of parliamentary scrutiny, I believe that the Bill as drafted provides an appropriate level of scrutiny.

Let me elaborate, if I may. In the case of UN sanctions, revocation would be an automatic response to a decision of the UN Security Council. We can assume that the reasons for the lifting of sanctions would be clearly understood, making a report unnecessary. In the case of UK autonomous sanctions, the regulations could only be revoked using the made-affirmative procedure. The Government would also need to explain the rationale for lifting sanctions and would do this when presenting the said regulations. The explanations provided by the Government would cover the areas proposed in the amendment. However, the Government would need to be careful about putting the full details of the UK’s strategy in the public domain. I know the noble Lord appreciates that point.

This means that, although we support the principle of transparency, obliging the Government to issue a full written memorandum, as proposed by the noble Lord, would be inappropriate. With that explanation, I hope the noble Lord is minded to withdraw his amendment.

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

I am not sure whether that is a cup half-full or half-empty sort of response. However, I shall take it away and consider it. I beg leave to withdraw the amendment.

Amendment 66 withdrawn.

Amendments 67 and 68 not moved.

Clause 38 agreed.

Clause 39: Power to amend Part 1 so as to authorise additional sanctions

Debate on whether Clause 39 should stand part of the Bill.

Photo of Lord Pannick Lord Pannick Crossbench

My Lords, the noble and learned Lord, Lord Judge, the noble Baroness, Lady Northover, and the noble Lord, Lord Collins, have joined with me in objecting to Clause 39, which would allow the Minister to authorise prohibitions or requirements of kinds additional to those set out in Chapter 1. So the Minister, by regulations, would have power to add to financial, immigration, trade, aircraft and shipping sanctions, and sanctions for the purposes of implementing UN sanctions.

If additional types of sanctions are to be added to Chapter 1 and they are not new types of UN sanctions—which is already covered by Clause 7—surely that should be done by primary legislation so that Parliament has the same opportunity to debate and amend the proposals as it does with the clauses of this Bill. These are vital matters to add new types of sanctions to this legislation.

If there is in future a need to add to Chapter 1, a short Bill could be brought forward. If the Minister believes the matter is urgent, this House and the other place have procedures that ensure that such a Bill can and would be debated speedily. The consequences of designation are simply too grave to allow Ministers by regulations to add further types of prohibitions to the legislation.

There is also a drafting point to mention on Clause 39. Clause 39(2) says, in its final words, that the powers conferred by Clause 39(2) are,

“not to be taken to confer any power to add to or amend the purposes mentioned in section 1(1) or … section 1(2)”.

That is very wise because the Minister should not and cannot have, by regulation, a power to add to the list of purposes—that is to make regulations for the purposes of complying with UN obligations, international obligations, to deal with terrorism, national security, international peace and security or foreign policy objectives. We have debated earlier whether those provisions are too wide in some respects, too narrow in others. It is, however, quite right that Clause 39(2) prevents the Minister by regulations from adding to those purposes. The drafting point is that that is stated only at the end of Clause 39(2), and it should, I think, be made clear that that limitation applies to the whole of Clause 39, in particular Clause 39(1), but that is a minor point for the consideration of the Minister and the Bill team. The other point is much more substantial.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs) 6:15 pm, 29th November 2017

My Lords, just as my noble friend Lord McNally and I opposed Clause 35 standing part of the Bill, so we oppose Clause 39 standing part of the Bill. Of course, this is in many ways a more dangerous clause. While, under Clause 35, we might find ourselves not imposing sanctions which other countries—say, within the EU—were imposing, in this case the Government are apparently happy to secure carte blanche powers for imposing sanctions.

As the noble Lord, Lord Pannick, has said,

“an appropriate Minister, may by regulations”,

amend this part of the Bill to,

“impose prohibitions or requirements of kinds additional to those for the time being authorised in Chapter 1”.

The Constitution Committee states:

“We do not consider it appropriate for Ministers to have powers as broad as those conferred by Clause 39. In particular, we consider it constitutionally inappropriate for Ministers to have the power, by regulations, to create new forms of sanctions”.

The Delegated Powers Committee states that,

“we do not consider the powers conferred by Clause 39 to be appropriate”.

They explain:

“We do not consider that the FCO’s reasons are sufficient to justify the powers conferred by Clause 39, particularly having regard to the potential width of the powers and the very significant effects on individual rights that amendments made under these powers would be capable of having”.

They also point out, in relation to UN sanctions, that,

“this power is unnecessary for enabling additional sanctions measures to be imposed for the purposes of complying with UN obligations since Clause 7 already has this effect”.

From right across this Chamber and from the Constitution Committee and Delegated Powers Committee comes a clear message, so we join others in opposing that Clause 39 stand part of the Bill.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour

The width of this power seems extraordinary and constitutionally offensive. As I understand the drafting of the Bill, it is open to a Minister to pass regulations which allow him to identify individuals on whom he can impose a sanction or prohibition that he has invented. What is more, the only restriction on him is that it must be for the purposes set out in Clause 2(1). If the Minister honestly believes that the invention of a new sanction or prohibition is justified by “a foreign policy objective” of the Government—for example, gaining support from one country by attacking its nationals in this country—the power given by Clause 39 would entitle them to invent a new prohibition and impose it by regulations. Furthermore, should any primary legislation stand in the way of a Minister inventing such a new prohibition that he or she believes is designed to promote a foreign policy objective, that primary legislation can be amended to get rid of an objection by the very same regulations under Clause 44(2). That a Minister could do by secondary legislation such a thing—for example, restrict somebody’s spending their own money, prevent them leaving their home, take away their car or stop certain sorts of bank account being used—without primary legislation strikes me as well beyond what any responsible Government would think should be done by secondary legislation. Can the Minister confirm that my analysis of what could theoretically be done is right, and explain why it is appropriate that that be done by secondary legislation?

Photo of Lord Faulks Lord Faulks Conservative

The noble and learned Lord puts a rather sinister construction on this clause. I do not want to add to my noble friend’s discomfort, but I need some persuading that Clause 39 is necessary given the width and nature of the sanctions and the purposes. It was important that the Government resisted the attempt to narrow “a foreign policy objective”, which was an amendment that we debated on the previous occasion, but “a foreign policy objective” gives the Government quite a lot of room for manoeuvre having identified an appropriate sanction. While I suspect that Clause 39 was inserted as a “just in case” provision rather than to give Ministers extraordinary power of the sort that has been discovered, it nevertheless remains at least open in theory to a Minister to exercise power in a way I think all noble Lords find difficult to accept.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour

I intervene only to say this: I did not suggest that the motive of the Government was to do this. My experience as a Minister is that you put through legislation and many years later, after emollient assurances given in the House of Lords, those pesky lawyers look at what is possible under the Act. What I have described is possible. Let us imagine if those very same pesky lawyers said, “Well, you might have difficulty getting that through with primary legislation because of the extraordinary width of the powers, but actually we’ve found these rather clever powers in the Sanctions and Anti-Money Laundering Bill which allow you to do it without primary legislation”. That is the danger.

Photo of Lord Hope of Craighead Lord Hope of Craighead Convenor of the Crossbench Peers

My Lords, I do not want to take anything away from the force of the points just made by the various speakers who object to the clause more fundamentally, but I want to pick up the point the noble Lord, Lord Pannick, described as minor: the wording of the clause. If the Government are minded to keep it, I suggest they might like to look at it again. Subsection (1) is very general, and the opening words of subsection (2) state that what follows is:

“Without prejudice to the generality of subsection (1)”.

The bit at the end in brackets, one assumes, does not qualify subsection (1). Is it in the right place? Is the proclamation that what follows is:

“Without prejudice to the generality of subsection (1)”,

really apposite if you are trying to restrict the scope of the powers as you seek to do in subsection (2)? It is a very interesting interaction of subsections but I suggest that it needs a little more care if the clause is to remain—I say nothing more in support of the point that the clause should not stand part of the Bill.

Photo of Lord Collins of Highbury Lord Collins of Highbury Opposition Whip (Lords), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (International Development)

My Lords, I think this is one area where the Minister will have to be in his giving mood, because there is very strong opinion on it across the Committee. What the noble Lord, Lord Faulks, said is absolutely correct: it is a “just in case” clause. What if this happens? What if that happens? If things happen, there is a process and a procedure and the noble Lord, Lord Pannick, said it quite explicitly: bring in laws to deal with it; bring in a Bill that addresses those specific concerns. If it is an urgent situation that we had not thought of, there are processes and procedures we can adopt.

As my noble and learned friend said, there is an opportunity here for what he calls “pesky lawyers”. I am always cautious—whenever I dealt with lawyers in my life I always took the precaution never to ask a question I did not know the answer to. That is the situation here. Because you cannot think of the circumstances, but there may be circumstances, you say, “Let us put it in the Bill”. I am sorry, that is not acceptable. There is a consensus across the board on this and it is even a clause on which, as the noble Baroness, Lady Northover, said, the Constitution Committee and the Delegated Powers Committee are as one, as they are not on other clauses. So I fear this is one issue about which the Minister will have to think again.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, I thank all noble Lords for their contributions on this clause. I am hearing the message loud and clear, but in doing so I need to pick up on a few points as to the motive and the intent behind the clause. I appreciate the clarification by the noble and learned Lord, Lord Falconer, of the Government’s motives. I will not comment on his description of lawyers; it would be entirely inappropriate for me to do so. However, he makes a valid point about the explanation and it is appropriate to explain the Government’s intention behind the clause.

The clause will allow the UK to make amendments to the Bill, as noble Lords have mentioned, to allow for the imposition of new and unforeseen sanction measures, a point well made by my noble friend Lord Faulks. The power is confined to new types of sanctions and cannot be used to alter the purposes for which sanctions can be imposed. I should explain what I mean by new types of sanctions. Common types of sanction include asset freezes, travel bans, arms embargos and prohibitions on aviation and maritime transport. These are included in the Bill. However, the international community sometimes finds it necessary to develop and deploy new types of sanctions. Indeed, a recent example is the UN sanctions imposed in respect of North Korea. That resolution requires that UN member states do not grant work permits to North Koreans save where the UN agrees, in advance, on a case-by-case basis. Prior to the UN’s putting in place that sanction, such a sanction did not exist. There may be times in the future when a currently unforeseen type of sanction would again be appropriate.

Photo of Lord Pannick Lord Pannick Crossbench

I am sorry to interrupt the Minister but if the new type of sanction is to be imposed because the UN has considered it appropriate, it surely falls within Clause 7.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State 6:30 pm, 29th November 2017

I think I mentioned Clause 7 in the preamble, but the noble Lord is correct. I was going on to say that, while Clause 7 would allow the UK to adopt new types of sanction when mandated by the UN, there may be times in the future when the UK needs to act outside the direct auspices of the UN.

Without the power provided by Clause 39, the UK will not be able to deploy these types of sanction without first passing new primary legislation. I have heard that point very clearly from noble Lords. That could significantly hinder our ability to co-ordinate sanctions with allies at times when UN action is not possible for political reasons. I alluded to the circumstances in earlier debates. This would risk the UK becoming the weak link in co-ordinated international responses to international crises of the kind we have seen in the Syrian civil war and Russia’s annexation of Crimea.

I also agree that it is important to give Parliament its assent when new powers are bestowed on government. That is why this clause provides that the draft affirmative procedure be used in these circumstances. In proposing that this procedure be followed—I come back to a point I made in earlier debates—the Government have sought to balance the twin demands of ensuring parliamentary scrutiny and ensuring rapid international responses.

That said, I will make two points, first on the substantive issue. I have again indicated the Government’s willingness to listen. The noble Baroness, Lady Northover, among others, rightly made the point about the reports that have been produced by both the Constitution Committee and the Delegated Powers and Regulatory Reform Committee. Indeed, they have made a similar point to that which has been debated in this House and we will be responding to those reports shortly. Therefore, I will take this back and look at the sentiment and the strength of opinion that has been expressed in this House.

On the point made by the noble Lord, Lord Pannick, and the noble and learned Lord, Lord Hope, on the drafting of Clause 39(2), while I am not a lawyer, I was looking specifically at the drafting as the noble Lord spoke. It is extremely important that we look at that again and I will take that back to ensure the drafting reflects the intent behind Clause 39. With that proposal, I hope the noble Lord will be minded to agree to the clause standing part of the Bill.

Clause 39 agreed.

Clause 40: Power to make provision relating to certain appeals

Debate on whether Clause 40 should stand part of the Bill.

Photo of Lord Paddick Lord Paddick Liberal Democrat Lords Spokesperson (Home Affairs)

My Lords, in asking that Clause 40 should not stand part of the Bill, we seek the clarification that I asked for at Second Reading, and failed to receive from the Minister, about Clause 40 and the power to make provision relating to routes to challenging decisions with immigration implications. Noble Lords will know that the Bill gives powers to Ministers to impose sanctions. Among them are immigration sanctions or the power to designate persons as “excluded persons” for the purposes of Section 8B of the Immigration Act 1971. In essence, part of the sanctions package could be either to remove designated persons from the UK or to prevent them entering the UK. The Bill provides a mechanism for those affected to ask for the decision to impose sanctions to be reviewed, initially by a Minister and subsequently by the courts—the Court of Session in Scotland and the High Court in the rest of the UK—which could include the decision to designate an individual an excluded person. This would, in effect, be an appeal against the decision to impose the sanction.

An excluded person could, alternatively or in addition, claim that they have a right to asylum in the UK or that their human rights would be infringed if they were returned to their country of origin or refused entry to the UK. This would, in effect, be an appeal against the consequences of the imposition of the sanction, rather than against the decision to impose the sanction itself. It is important that these two potential routes to challenge being designated an excluded person—either the decision to designate or the consequences of being designated—are dealt with separately and appropriately. My understanding is that that is what Clause 40 allows the Government to do, by regulation.

However, Clause 40 is quite complex and, at the same time, non-specific about what the regulations and their effect might be. The Explanatory Notes to the Bill appear to suggest, in paragraphs 115 and 116, that claims of asylum and human rights will continue to be dealt with by the Home Secretary as the Minister with the knowledge, experience and expertise to decide these matters, not by the Minister imposing the sanctions, and that any appeal against the Home Secretary’s decision would be to the immigration and asylum chamber of the First-tier Tribunal, a specialist tribunal with expertise in deciding such claims, not the High Court or Court of Session, where an appeal against the imposition of the sanction would be heard.

In a letter dated 16 November, the Minister stated that it was the Government’s,

“intention to provide, at Committee stage, an illustrative draft Statutory Instrument in relation to the powers under clause 40, so that Peers can fully scrutinise how decisions that have immigration implications will be taken and the routes of challenge”.

We are in Committee and have come to Clause 40 in the Bill, and no illustrative draft statutory instrument has been made available. Can the Minister tell the Committee how noble Lords are expected to accept Clause 40 in the absence of what he promised in his letter?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

My Lords, perhaps I might intervene in this debate and save the Committee some time. First, they say that sorry seems to be the hardest word but it is not for me. I apologise to the noble Lord, Lord Paddick, since after Second Reading, as he said, I wrote to him and said that the Government intended to bring forward a draft instrument and would put on record during Committee the Government’s intended policy in regard to this clause. I regret to say that we have not fulfilled the first part of that intention—I will come to it in a moment—but I hope that, through what I say, I can fulfil the second part of it now.

Let me assure the noble Lord, Lord Paddick, and the Committee more generally that much work has been, and continues to be, done between officials in various departments on refining this important policy area. As the noble Lord acknowledged, the issue is complex and involves not only the specialist tribunal but how this relates to other aspects of the Bill. This has meant that, despite best efforts by officials, the draft statutory instrument was not ready to be published. It was my view and that of the Government that, rather than publish a statutory instrument that is not yet fully ready, Parliament would be better assisted by seeing a more mature version of that instrument. To that end, my officials and others across Whitehall will continue this work apace. We will endeavour to publish a version of the statutory instrument ahead of Report. I would be happy to meet the noble Lord in the interim to discuss this specific issue. I would also like to put on record for the Committee the intention behind this clause and address some of the points that he made.

Clause 40 concerns how appeals against the immigration consequences of UK autonomous sanctions are handled. I would like to give the Committee some background as to the current arrangements before I go on to speak about the clause. Under the current arrangements, UN or EU travel bans are, in the vast majority of cases, imposed on individuals who are outside the UK and have no connection to the UK. The Immigration Act 1971 already makes provision for persons subject to UN travel bans. Clause 40 allows us to ensure that the persons subject to UK autonomous travel bans can benefit from a similar provision.

In the unlikely event that a UK autonomous travel ban were to be imposed on a person in the UK, this would, as a matter of domestic law, have consequences for their immigration status in the UK—a point I know concerned the noble Lord, Lord Paddick. Whereas a person who is outside the UK will be refused entry, those who are in the UK will lose the right to remain here and may be subject to removal. A person affected in this way might argue that any removal from the UK would interfere with their rights under the European Convention on Human Rights, or be contrary to our obligations under the refugee convention. As a result, they may wish to make a human rights or humanitarian protection claim to prevent their removal. These immigration claims are usually decided by the Home Secretary, and a very developed machinery has grown up around the decision-making process to ensure that it is fair and effective and, importantly, complies with our international obligations. Such decisions, once made, can also give rise to a right of appeal before the immigration and asylum chamber of the First-tier Tribunal, a specialist tribunal with expertise in deciding such claims.

I turn to the Bill. Such immigration claims may also be made against the immigration consequences of a UK autonomous travel ban imposed under the Bill. Again, immigration claims are most likely to arise where an individual in the UK would lose their right to remain here. Noble Lords might ask why we need Clause 40, given that this situation can already arise in the context of a UN or EU travel ban. I wish to explain the point here. The Bill establishes a new administrative reassessment process for designations and a court review process in the High Court or, in Scotland, the Court of Session. No such equivalent administrative and court mechanisms are currently applied in domestic law for UN or EU travel bans. The mechanisms in place are different, so we will need to adapt the existing decision-making and appellate structures that I described earlier in order to accommodate the Bill. That is why we need Clause 40.

I turn back to the practicalities. Cases of this kind are likely to be limited in number, but it is vital that we get this right—a point made by the noble Lord himself. The Government consider it important to ensure that such claims are handled appropriately. We want to ensure that domestic sanctions do not unjustifiably interfere with fundamental rights or run contrary to our obligations under the refugee convention. It is also important that the effectiveness of our domestic sanctions regime is not compromised because our domestic legislation no longer enables us to manage effectively such immigration claims as may be made. The Government have therefore considered how these immigration claims should be treated in the context of the new administrative reassessment and court review processes.

Our conclusion is that, as a starting point, we should seek to maintain the status quo. The Home Secretary and the Immigration and Asylum Tribunal should remain the appropriate decision-makers, as they are now. Both the Home Office and the tribunal are vastly experienced in this area, having dealt with 38,681 human rights and asylum claims and appeals in 2016 alone. However, some changes will be necessary in order to ensure that domestic legislation enables us to manage situations where, for example, there would otherwise be the possibility of both the High Court and the tribunal considering the same issues, or the High Court being required to determine a protection claim that the Home Office had not had the opportunity to consider.

To illustrate the point, whereas the tribunal would be best placed to determine an appeal against an immigration decision, determining the lawfulness of a decision to freeze an individual’s assets is a decision that would be better suited to the High Court. The clause provides the powers necessary to make these changes, which will ensure that we continue to comply with our international obligations and that the effectiveness of our domestic sanctions regime is not compromised. To provide appropriate scrutiny, regulations made under this power will use the draft affirmative procedure.

I give this very detailed explanation along with, once again, an apology to the noble Lord, Lord Paddick. I believe that at Second Reading when he raised this issue I had momentarily left the Chamber or I was near the Box to clarify something, so I did not fully hear his contribution and read it only later in Hansard. As I said, I put on record that we would look to return to this in Committee, which clearly we have not been able to do. I am much minded that the instrument put forward is one that we have looked at extensively and reflects the detail of what I have just submitted to your Lordships’ House. I therefore hope that with that somewhat detailed explanation, which I briefly mentioned to the respective Front Benches out of courtesy in your Lordships’ House, the noble Lord will be minded to withdraw his amendment, with the assurance that I look forward to working with him specifically on that SI before Report.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour

I am grateful to the Minister for that helpful and detailed explanation. As I understand him, he is saying that regulations can be produced under this provision, which will delineate between the Minister, the High Court and the Upper Tribunal as to who decides what in relation to the variety of legal challenges that are available both in ordinary law relating to asylum and the right to remain and the rights given under this Act.

That is pretty complex. It is very difficult to judge whether this regulation-making provision is appropriate in its width without seeing a draft of what the Government have in mind. It is critical that the draft be made available a significant time before Report. I do not know when Report will take place, but it may be in the middle of January. Therefore, in the light of what the Minister said about the detailed work on this draft instrument, when might we see it? Obviously, a lot of work has been done on it and there is a draft in existence. The issue is legal appropriateness and there is no reason why we should not see the draft now.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State 6:45 pm, 29th November 2017

The noble and learned Lord makes an important point about ensuring appropriate time before Report. He is correct to say that we are looking at Report taking place towards the middle of January in the new year, and correct to say that we must allow sufficient time to accommodate it. I cannot give him chapter and verse on the exact date but he makes his point well. I also subscribe to his view that it is important to allow noble Lords sufficient time.

Photo of Lord Falconer of Thoroton Lord Falconer of Thoroton Labour

I am not asking for a specific date, but will it be by the end of the week, or the end of next week? The Minister must give us some assurance that we will have it in time.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

As I said, there are already, as the noble and learned Lord will acknowledge, various issues. We will do this in good order. Perhaps I may take this matter back—because various departments are working on this—and clarify appropriately. I will write to noble Lords on the specific date by the end of the week, which will then provide the detail. I fully acknowledge what the noble and learned Lord said about the importance of allowing effective scrutiny before Report. I say to the noble Lord, Lord Pannick—I am sorry, I meant the noble Lord, Lord Paddick; the noble Lord, Lord Pannick, has left but he clearly left an impression on me—that I look forward to working with him once the draft instrument has been circulated. For good order—I look over to the Box and my private office—once the draft has been published, we will seek to circulate it and lay a copy in the Library, as appropriate.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Minister of State

I think that I am being corrected by my rather forceful Whip on my left. I am sure that this matter will be clarified through the usual channels.

Photo of Lord Paddick Lord Paddick Liberal Democrat Lords Spokesperson (Home Affairs)

My Lords, I very much welcome the support and contribution of the noble and learned Lord, Lord Falconer of Thoroton. I am very grateful to the Minister for explaining that asylum claims, and any claim that somebody’s human rights will be infringed, will be dealt with by the most appropriate Minister—the Home Secretary—and through the immigration appeal tribunal route, and not by the provisions in the Bill to appeal against the imposition of the sanction itself. I am grateful for that reassurance; it is the one that I was seeking.

I am grateful, too, for the Minister’s apology for missing some deadlines, if I may put it that way. Obviously, I am content to withdraw my opposition to Clause 40 standing part of the Bill.

Clause 40 agreed.

House resumed.

Photo of The Earl of Courtown The Earl of Courtown Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, as the passage of business has travelled fairly quickly, I think it only fair to speakers in the next debate if we adjourn for 10 minutes until 7 pm.

Sitting suspended.