New Clause 2 - Licensed production overseas

Part of Export Control Bill – in a Public Bill Committee at 11:00 am on 18 October 2001.

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Photo of Nigel Griffiths Nigel Griffiths Parliamentary Under-Secretary, Department of Trade and Industry 11:00, 18 October 2001

A number of points have been raised, and I am just referring to the evidence that Lord Scott gave to the Quadripartite Committee, and some of the key questions that he raised on this issue. He asked what the remedy would be for a breach in the case of an overseas company that had broken its undertakings. That company could not be prosecuted effectively in this country, particularly if the Government of another country had been responsible for the breach. We carefully considered Lord Scott's evidence and reached a firm conclusion.

We completely reject the assertions made by the Campaign Against Arms Trade about the gaping hole in the UK export control regime with regard to licensed production. NGOs have given me examples that are not current but go back a long way. Many of us would not disagree with those examples. That is why we believe that the framework will tackle abuses that have been raised with us and that have been substantiated. Other abuses have not been substantiated, which is another matter.

We are attempting to build into the Bill an effective way of controlling licensed production. As the Campaign Against Arms Trade acknowledges, the licensed production arrangements typically depend on the supply of component parts and design of production technology to overseas productions by the UK company that is responsible for manufacturing its products. We therefore have a direct influence on that, because it is highly likely that any transfer of parts or technology comes under the Bill and requires a licence. If evidence of the type produced by the hon. Member for Twickenham were substantiated, the Bill's provisions would allow the Minister to take action and reject that licence, because of the potential military end and diversion of use under discussion.

The Bill has adequate powers, and we should not be required to go further. That is the best way to curb the abuses. I use the word ``curb'' advisedly, because there will always be a battle to eliminate abuses, as other countries with lauded regimes claim. It is therefore important that we have the most practical, effective and tough rules to clamp down on the abuses as far as we can.

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