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Clause 47 - Power of OFT to require access to premises

Consumer Credit Bill – in a Public Bill Committee at 12:00 pm on 28th June 2005.

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Question proposed, That the clause stand part of the Bill.

Photo of Gerry Sutcliffe Gerry Sutcliffe Parliamentary Under-Secretary (Trade and Industry) (Employment Relations and Consumer Affairs)

The clause gives the OFT powers to enter premises to obtain information and documents and enables it to carry out routine monitoring visits when enforcement officers will be able to observe business operations. It also enables the OFT to investigate more effectively suspected lapses of fitness. The OFT must first issue a notice requiring a licensee to ensure that an authorised officer can enter premises at a reasonable time. The clause does not apply to premises used only as dwellings.

The notice issued must set out the reasons why access is required. The authorised officer may observe the business or inspect any documents on the premises that have been specified or described in the notice and are present. An authorised officer may also require anyone on the premises who is involved in the licensee’s business to help them in their duties.

The OFT can access the premises only of standard licence holders and the original applicant for group licences and may do so if that is reasonably required to help it to carry out its duties under the legislation. There may be times when the OFT needs to access premises of third parties. In such cases, the OFT may require access to the premises of someone other than the licensee only if he thinks that an act or omission concerning fitness has occurred. Such an inspection must be reasonably required to enable the OFT to take or to consider taking licensing action. Again, that does not apply to premises used only as dwellings.

With that explanation, I hope that the Committee will support the clause.

Photo of Charles Hendry Charles Hendry Shadow Minister (Higher Education and Intellectual Property), Deputy Chair, Conservative Party

The clause provides distinctive powers for the Office of Fair Trading. We agree in principle that it should have those powers, but I would be grateful if the Minister clarified a couple of points of detail.

New section 36C(4) states:

“The licensee shall secure that the required access is given at such times as the OFT reasonably requires.”

How does he define “reasonably”? For example, would it essentially mean working days and working hours or could it include weekends or the middle of the night? We need a clear definition.

New subsection (3)(b) states that it does

“not include premises which are used only as a dwelling.”

What happens if the premises are a dwelling? Do they come under clause 48, which gives powers to inspect premises under a warrant, or are dwellings more permanently excluded from such investigations? That would be rather surprising.

New subsection (8) states:

“A requirement may be imposed under subsection (1)...only if the observation or inspection in question is reasonably required for purposes connected with the OFT’s functions under this Act.”

Again, can he define “reasonably” for us? That would provide us with the greater clarity that we are seeking.

Photo of Gordon Banks Gordon Banks Labour, Ochil and South Perthshire

To reinforce what the hon. Gentleman has said, I sought a definition of “reasonably” and “reasonable”, particularly with reference to new new section 36C(5):

“The OFT shall give reasonable notice of” times for inspection. What is considered reasonable and who is it considered reasonable by?

Photo of Gerry Sutcliffe Gerry Sutcliffe Parliamentary Under-Secretary (Trade and Industry) (Employment Relations and Consumer Affairs)

Sometimes notes are intended to be helpful, but not always. I am grateful for the acceptance of the hon. Member for Wealden that the clause is necessary to allow the OFT to carry out its functions in the way that we would all expect.

The reasonableness test applies to any other such licensing procedure, in the sense that it should be proportionate and reasonable. The OFT has to be effective in getting the required result and it has the discretion within the concordats that operate. Premises that are dwellings will come under clause 48, as the hon. Member for Wealden said—I now understand the nod that I was given. Dwellings fall under the warrant aspect of that clause, which we will discuss later. The OFT will be directed to maximise its opportunities to get the required results within the concordats.

Question put and agreed to.

Clause 47 ordered to stand part of the Bill.