Business and Trade Sub-Committee on Economic Security, Arms and Export Controls
Wednesday 15th July 2026
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09:30
Speaker 1
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Speaker 1
We will for the first quarter of 2027, produce all of that data as as effectively as we possibly a bit later than that, obviously, because we have to put all of that data together. But I can make that commitment that we can. Now, that requires a chunk of work, obviously, between ourselves and HMRC, but it's important that the public should have the proper information rather than the kind of guesstimate.
09:30
09:30
Speaker 3
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Speaker 3
We'd like to record our thanks to you, Sir Chris, for driving that through. This has been a long standing ambition of you, as you acknowledged in the report published this morning. And it's been a long standing ambition of this committee to secure that data. So we appreciate you making that progress.
09:31
09:31
Speaker 1
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Speaker 1
I do want to issue everything with a slight caveat, which is that this is not easy. And you again, I don't want to bore you with the reasons why it's not easy. But obviously if you have an open general licence or a licence, as you know, in many of our licences, it's the maximum amount that somebody is allowed to export. And you want to know what the actual amount is that is exported. As I say, that's a relationship between us and HMRC.
But I really want to pay tribute to the to the team under Rosemary, who have made sure that we've got all of those ducks, I think, pretty much lined up in, in in a way able to deliver that for, for next year and.
But I really want to pay tribute to the to the team under Rosemary, who have made sure that we've got all of those ducks, I think, pretty much lined up in, in in a way able to deliver that for, for next year and.
09:31
09:31
09:32
Speaker 2
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Speaker 2
No problem at all. Okay. Clear. Um, and kind of following up on that kind of transparency trend, Lord Coker um, there's a crown exemption. Um, and I'm just going to quote, so where the crown owns the controlled military goods technology or software being exported and a similar rights over disposal than exporter acting on the Crown's behalf may carry out the export without a licence. If we're if we are, and I really appreciate the kind of approach of transparency, if we are being transparent about this.
Would you please, uh, give a. View about whether we actually are now willing to. Report that information of what. What data is being exported?And do you think a licence should be exempt?
Would you please, uh, give a. View about whether we actually are now willing to. Report that information of what. What data is being exported?And do you think a licence should be exempt?
09:33
Speaker 4
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Speaker 4
Well, I think obviously under Crown exemption um that's it's MOD owned. Equipment or data or technology. Uh and it's for mod purposes um for UK mod purposes. But so that's the context within which crown exemption takes and it takes you to gifting. But we'll come back to that later. But let me say we are always keen to be as transparent as we can be. Um, the, for example, the, everybody who applies for that or wants to do that has to have a letter, of exemption to allow them to, to operate under, under crown exemption.
There were 106 of those in 2025. Um, and certainly if you're asking whether the department should look into whether it can publish more with respect to any of that, whether it be the data or anything. Of course, we'll always look at that. Um, and because it's in all of our interests, um, recognising from an mod perspective that there's an operational, there are operational requirements which everybody in the committee will appreciate and accept. But alongside that, we have a responsibility to be as open and transparent as we can be.
There were 106 of those in 2025. Um, and certainly if you're asking whether the department should look into whether it can publish more with respect to any of that, whether it be the data or anything. Of course, we'll always look at that. Um, and because it's in all of our interests, um, recognising from an mod perspective that there's an operational, there are operational requirements which everybody in the committee will appreciate and accept. But alongside that, we have a responsibility to be as open and transparent as we can be.
09:34
Speaker 2
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Speaker 2
So just on that, I mean, so as I understand it, gifts exceeding £300,000 in value are notified to Parliament before the gift is made. What other information is made available?So let's say if there were a whole load of £295,000 gifts which were under that under that bar, what information is provided to to get a sense for the the public to get a sense of what's been going on inside that bracket?
09:34
Speaker 4
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Speaker 4
Well, I think that's why it's so important in the um. Report that's just been published today, which I think the committee were given yesterday. For example, the, the as you say, for exemption for amounts over £300,000 has to be reported to Parliament. But in the report, um if we look at controlled equipment and gifting, their amounts under that are also outlined in that.
09:35
09:35
Speaker 4
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Speaker 4
Yeah. Yes. By country. So for example, on pages 33 and 34 there are exemptions. Mr. Maynard under under 300, 000. And I won't go through all the list because of time, but they're outlined there. And I hope that meets some of the concern that you may have about that. But I appreciate the committee may have other views when it considers all of the evidence that it's had. And if there are suggestions, we're always willing to consider them.
Of course.
Of course.
09:36
Speaker 2
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Speaker 2
Thank you. And just to be a, um, one point. So, so so the annual report was was released last night. Yes. Um which, which it would have been ideal to have got it maybe a day or two earlier. So we would have had a chance to read it as opposed to getting a 66 page the night before we all meet. Yeah. Um, so next time, could we, could we just make sure we have a window so that that isn't the.
09:36
Speaker 4
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Speaker 4
I've been on, I've been on member of the select committee. And I know how frustrating sometimes it is to receive. Information. Um, maybe a day or two after it should have been received. So I, let's be candid and open about it would have been ideal for the committee, uh, the chair and all the committees to have received it before that. We got it to you as soon as it was agreed across government. And we could do.
And we were absolutely certain that we had to do it, at least before the committee. But I take your point.
And we were absolutely certain that we had to do it, at least before the committee. But I take your point.
09:37
09:37
Speaker 4
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Speaker 4
If I'm still here?Thank you. But the serious point is, of course you should. Annual reports should be made available to committees, um, sooner than than they were with respect to this. But Mr. Bryant started with a very open and transparent comment about what was happening from a DPI point of view, certainly from an ID, and I know from an fc d o perspective, our intention is to be as open as possible, but from an mod perspective, there's sometimes a tension about openness and operational security.
But we our aim is to be as open as possible. But I take your point that you've made.
But we our aim is to be as open as possible. But I take your point that you've made.
09:38
09:39
Speaker 4
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Speaker 4
Not not the crown exemption. So if you look at crown exemption so you've got crown exemption as a whole. So you have the crown exemption which um is if we give an example, the mod owned um goods or equipment which is used for mod purposes. So the end user is the mod. So it's the UK's own mod. It's the end user. So for that you don't require um that, but if you then go under crown exemption gifting also operates.
Gifting is tested against the strategic. Strategic licence. licensing criteria. Thank you. Uh is tested against that criteria to make sure and much of the discussion takes place before a formal decision is made with respect to that. But so for gifting, it's a different process to, um, to, to our own armed forces and our own equipment. But it's all under crown exemption.
Gifting is tested against the strategic. Strategic licence. licensing criteria. Thank you. Uh is tested against that criteria to make sure and much of the discussion takes place before a formal decision is made with respect to that. But so for gifting, it's a different process to, um, to, to our own armed forces and our own equipment. But it's all under crown exemption.
09:40
09:40
Speaker 4
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Speaker 4
Applied financial tests, for example, um, making sure that um that financial tests and the various checks that you would expect if it's gifting who it's what according to the criteria, who it's going to, whether you can be certain that the gifting is going to operate in a way, uh, that, uh, that you would want it to, I should say, Mr. Byrne, if it's okay with yourself just to say Ukraine is and you'll see in the report, although we gift to Ukraine, it's outwith some of the the more general points that are made about gifting because of the urgent operational requirements that often take place there, the need for operational security, uh, and the need for us to act as promptly as quickly as possible.
But certainly for, um, as I say, against the criteria, financial tests and also assessment made by ourselves and others across government as to whether um. Whether these are fit and proper things to happen.
But certainly for, um, as I say, against the criteria, financial tests and also assessment made by ourselves and others across government as to whether um. Whether these are fit and proper things to happen.
09:40
09:40
Speaker 4
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Speaker 4
Yes. It's judged against that. To see whether it's appropriate. And again, for transparency, as far as I'm aware in Roger will correct me if I'm wrong, but we've no, uh, we haven't refused any gifting requests, but our argument and would be that much of the discussion takes place prior to anybody actually making a request. Uh, and we would expect in that to, if you like, um, avoid, uh, requests. That are just going to be refused. Um.
09:41
Speaker 3
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Speaker 3
Thank you. We'd like to move on to, um, arms to Israel now, but it's probably. Best if I start with this wider question of. The ban on goods and services from occupied Palestinian territories. So we know that in July 2024, the ICJ issued an advisory opinion asking. Advising states to take steps to prevent trade or investment that supports illegal Israeli settlements. On the 25th of February, I wrote to you to ask what you were doing about that ban.
You said that you were continuing to consider a range of options. I then asked the Prime Minister about this on the 23rd of March. He replied that government would keep the matter under review. I wrote to you again in April 2026 and the position remained unchanged. Now, in the meantime, a number of our European allies have made progress on this Spain, Ireland, Netherlands, Belgium, Luxembourg and the EU. Foreign ministers considered this question um on Monday. Our colleagues in Ireland have actually passed the Israeli settlements in occupied Palestinian Territory bill through the Doyle on the 7th of July.
And last week the new Prime Minister in coming said this. He said, we have got to do more to put pressure on the Israeli government. Netanyahu's government is clearly attempting to make a two state solution impossible. That is why we need to do more. Also looking at measures to ban trade in goods with illegal settlements. So just before we get to the meat of the policy, Mr. Doughty, could I just ask you to give us what is your assessment of the situation on the ground now?What is the government's current assessment of the level of settler violence in occupied Palestinian territories?What is your assessment of the continued expansion of illegal settlements, and what threat does that activity pose to the integrity of the Palestinian state, which we have now recognised?
You said that you were continuing to consider a range of options. I then asked the Prime Minister about this on the 23rd of March. He replied that government would keep the matter under review. I wrote to you again in April 2026 and the position remained unchanged. Now, in the meantime, a number of our European allies have made progress on this Spain, Ireland, Netherlands, Belgium, Luxembourg and the EU. Foreign ministers considered this question um on Monday. Our colleagues in Ireland have actually passed the Israeli settlements in occupied Palestinian Territory bill through the Doyle on the 7th of July.
And last week the new Prime Minister in coming said this. He said, we have got to do more to put pressure on the Israeli government. Netanyahu's government is clearly attempting to make a two state solution impossible. That is why we need to do more. Also looking at measures to ban trade in goods with illegal settlements. So just before we get to the meat of the policy, Mr. Doughty, could I just ask you to give us what is your assessment of the situation on the ground now?What is the government's current assessment of the level of settler violence in occupied Palestinian territories?What is your assessment of the continued expansion of illegal settlements, and what threat does that activity pose to the integrity of the Palestinian state, which we have now recognised?
09:43
Speaker 5
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Speaker 5
Well, I think the threat is very severe. As you point out, chair. And, uh, let's be clear, these settlements are illegal. Uh, they should not be taking place. Um, they're not only wrong in themselves, they do threaten that progress towards a two state solution. And we've been very, very clear about that in our, in our condemnation and also in the actions that we've taken. And that includes, of course, you know, sanctioning individuals, entities. We took recent further action on those involved in this.
We've been very, very clear that this violence is completely unacceptable and must stop. We raise that at every possible opportunity. And we, of course, as you know, have sanctioned two individuals in the Israeli government who've been directly involved in some of the most heinous comments and actions in relation to this. Um, so I'll be absolutely clear, but you are absolutely right that we need to go further. And that's why we're we're considering a range of options. I don't want to get ahead of those.
And you've rightly pointed to the transition in government, the ability to make new policy. And I'll bring in, um, my colleague in a moment to respond. But, um, we have obviously particularly led on issues in relation to sanctions. Um, and at the moment we're looking at expanding, as the Foreign Secretary said, how we can expand our sanctions regime in a targeted way against those who are facilitating, um, settlements, um, at the moment. And you'll know that we can sanction where there's evidence of being linked to settler violence, but not, for example, in relation to a contractor working on the settlements.
And we need to expand our sanctions powers. And I and others have commissioned important work on this over some time, you'll understand that our sanctions team work incredibly hard across a range of regimes around the world. We need to get this right. We need to make sure it's legally sound. We need to make sure it's impactful as the rest of our sanctions regimes have been. Um, but I am strongly in favor of us expanding our powers in this area, including in relation to, um, I, um, abuses.
Um, and hopefully with that new regime and those new measures in place, we would then be able to further target businesses to ensure they're not contracted to help build those settlements. So, um, I think we all look in horror at what has been going on. And I think there has been a distinct, a distinct change. I think we were more hopeful back in December that there were there were things moving. Instead, we've seen a completely different approach, um, from the government of Israel in relation to this and of course, on the ground, uh, worsening of the situation.
So, um, I think we're very, very clear about the level of violence, the complete illegality of what is going on and the peril that this puts a two state solution in. And therefore, we need to expand our powers and ability to, to take action. But of course, you'll know we've issued very clear advice to businesses and we've issued very, very clear statements. And crucially, we've used the powers that we do have to take targeted action against individuals and entities.
We've been very, very clear that this violence is completely unacceptable and must stop. We raise that at every possible opportunity. And we, of course, as you know, have sanctioned two individuals in the Israeli government who've been directly involved in some of the most heinous comments and actions in relation to this. Um, so I'll be absolutely clear, but you are absolutely right that we need to go further. And that's why we're we're considering a range of options. I don't want to get ahead of those.
And you've rightly pointed to the transition in government, the ability to make new policy. And I'll bring in, um, my colleague in a moment to respond. But, um, we have obviously particularly led on issues in relation to sanctions. Um, and at the moment we're looking at expanding, as the Foreign Secretary said, how we can expand our sanctions regime in a targeted way against those who are facilitating, um, settlements, um, at the moment. And you'll know that we can sanction where there's evidence of being linked to settler violence, but not, for example, in relation to a contractor working on the settlements.
And we need to expand our sanctions powers. And I and others have commissioned important work on this over some time, you'll understand that our sanctions team work incredibly hard across a range of regimes around the world. We need to get this right. We need to make sure it's legally sound. We need to make sure it's impactful as the rest of our sanctions regimes have been. Um, but I am strongly in favor of us expanding our powers in this area, including in relation to, um, I, um, abuses.
Um, and hopefully with that new regime and those new measures in place, we would then be able to further target businesses to ensure they're not contracted to help build those settlements. So, um, I think we all look in horror at what has been going on. And I think there has been a distinct, a distinct change. I think we were more hopeful back in December that there were there were things moving. Instead, we've seen a completely different approach, um, from the government of Israel in relation to this and of course, on the ground, uh, worsening of the situation.
So, um, I think we're very, very clear about the level of violence, the complete illegality of what is going on and the peril that this puts a two state solution in. And therefore, we need to expand our powers and ability to, to take action. But of course, you'll know we've issued very clear advice to businesses and we've issued very, very clear statements. And crucially, we've used the powers that we do have to take targeted action against individuals and entities.
09:47
Speaker 3
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Speaker 3
So you're being very clear with us today in what sounds to me like a bit of a breakthrough, you are actively looking at the both the powers that you need in order to expand sanctions against those who are basically building and operating these illegal settlements. Do you think that you actually have the powers that you need in order to move further, or do you need a new powers?
09:47
Speaker 5
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Speaker 5
I don't think we have all the powers that we need at the moment. And I have to say, chair, as the sanctions Minister, um, this has not just been a frustration in relation to, uh, the issue of settlements, but also actually a number of other contexts around the world where we want to take further action. Um, you will understand that it is also crucially important that we do get the legal frameworks right, the sanctions regimes right, as well as individual designations. We've been very, very successful in defending our sanctions regimes and actions in the courts.
It's important that that continues. We don't want to see that that fall apart in any way. I'm sure the committee would want to ensure that when we're designated, we're doing so legally, um, effectively and without unintended consequences. Um, we need to get that right. Um, we're working at pace to do that. And we've been looking at a series of options to do so.
It's important that that continues. We don't want to see that that fall apart in any way. I'm sure the committee would want to ensure that when we're designated, we're doing so legally, um, effectively and without unintended consequences. Um, we need to get that right. Um, we're working at pace to do that. And we've been looking at a series of options to do so.
09:48
Speaker 3
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Speaker 3
Very helpful. Thank you. Um, let me just cover your assessment of breaches or potential breaches or risks of breaches of international humanitarian law. So the Foreign Office has undergone a number of reorganisations recently, and there was some concern raised that the I assessment cell had been, if not disbanded, then certainly moved around within the department. Can you just put our minds at rest that this is a team that continues to do the critical work that it's undertaking?
09:48
Speaker 5
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Speaker 5
I certainly can, and I'll bring in Tom to confirm this as well from the official side, but I'll, um, cell and capability has simply moved. It continues to exist. It's within um EC2, um within the Fcdo, it's obviously a crucially important function of assessing UK export licensing decisions. And um, you know, we continue that work and I think there were some quite misleading, um reporting around this, but the Foreign Office has been going through a number of reorganisations recently and I think that was lost in the, in the, in the noise, so to speak.
So I can assure you that function continues. And Tom, I'm sure can can confirm that as one of the one of the key figures in our team.
So I can assure you that function continues. And Tom, I'm sure can can confirm that as one of the one of the key figures in our team.
09:49
09:49
09:49
09:49
09:50
09:50
09:50
Speaker 5
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Speaker 5
Correct. And we have raised and continue to raise that with Israeli counterparts at all levels. And obviously, that has influenced the decisions that we've undertaken. This government has taken in relation to, for example, advice on the suspension of of licences that were extant at the time that we came into office. So, um, we've been very, very clear about that. Those were the assessments that we undertook and we're very clear about our position on it.
09:51
09:51
Speaker 5
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Speaker 5
We undertake continual assessments and reviews. This is a this is a rolling ongoing process. And, of course, looks at the whole range of other contexts as well. And indeed, of course, in relation to issues outside of the Middle East as well. But I mean, Tom can probably explain a little bit more about how, how practically that process works within the team.
09:52
09:52
09:52
Speaker 3
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Speaker 3
That is very recent. Okay. So, um, sir Chris. Stephen Doughty and Tom Barry have laid out a very clear picture this morning that the settler violence is intense and threatens the integrity of the state of Palestine. A very recent assessment continues to show that Israel is not committed to upholding international humanitarian law in Gaza. And you'll have heard the remarks of the new Prime Minister that we have got to put more pressure on the Israeli government. That's why we need to do more.
Also looking at measures to ban goods with illegal settlements. A number of our allies are moving very quickly on this. Is it now time to move from simply labelling goods from illegal settlements to now banning goods from illegal settlements?
Also looking at measures to ban goods with illegal settlements. A number of our allies are moving very quickly on this. Is it now time to move from simply labelling goods from illegal settlements to now banning goods from illegal settlements?
09:53
Speaker 1
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Speaker 1
You don't mind me unpacking it a little bit, because I think it's important to get the granular detail of this right. Um, first of all, obviously these are illegal settlements. We that's been the settled view of the government for a long time. And they are expanding and expanding them and sustaining them is an illegal act. Um, we have recognised the state of Palestine and as Stephen has just laid out, there is an ineluctable logic of that, which is that no British business in any shape or form should be involved in the sustenance or the expansion of any of the illegal settlements.
Now, I'm just as worried about services as I am about goods in relation to that. In fact, you could argue that British businesses engaged in service industries exports into the, um, the illegal settlements are more just as problematic, if not more problematic. So, for instance, might there be companies in the UK that are providing mortgages or financial support for people who are building in the illegal settlements?Might there be people who are acting as estate agents for properties in the illegal settlements, or people providing accountancy services and so on, or legal services?All of these areas, I think, are just as important as the goods issues, which I know lots of people have been most focused on, which is goods arriving from, um, the.
Illegal settlements into the UK. So I think there is an ineluctable logic to us having to address all four issues. So imports and exports of goods and services. Um I, I. What I'm about to say is not an excuse, but there are complexities in each of these different elements. Um, so the most important one is even under the present rules, which both apply both for the EU and for us, there is no preferential tariff arrangement for goods that have come from the settlement.
Illegal settlements. However, we know we all know perfectly well that it's very difficult to enforce that because um, the. Arteries and the settlement areas and and the rest of Israel, green line Israel are um. You know, goods travel in and out very easily. Both heavy machinery and foodstuffs and so on. And so things can often just be labelled as product of Israel. Whereas in actual fact, as some wine people have said, for instance, they've obviously clearly actually come from the settlement areas.
So that is a difficult enforcement issue now. And it would be a difficult enforcement issue. Whatever, um, route we go down and I haven't been engaged in the conversations with Spain and with other countries, but I, I have heard from my colleagues that they, they worry about the, the actual effectiveness of the measures that they're taking. So we want to make sure that we do this correctly. Um, the question is whether there's a D, B, t route for doing these or an Fcdo route for doing all of these things.
What I and Hamish Faulkner in the Foreign Office have been doing for the last few months, is trying to look through all the details of this and get a a serious plan of action in place.
Now, I'm just as worried about services as I am about goods in relation to that. In fact, you could argue that British businesses engaged in service industries exports into the, um, the illegal settlements are more just as problematic, if not more problematic. So, for instance, might there be companies in the UK that are providing mortgages or financial support for people who are building in the illegal settlements?Might there be people who are acting as estate agents for properties in the illegal settlements, or people providing accountancy services and so on, or legal services?All of these areas, I think, are just as important as the goods issues, which I know lots of people have been most focused on, which is goods arriving from, um, the.
Illegal settlements into the UK. So I think there is an ineluctable logic to us having to address all four issues. So imports and exports of goods and services. Um I, I. What I'm about to say is not an excuse, but there are complexities in each of these different elements. Um, so the most important one is even under the present rules, which both apply both for the EU and for us, there is no preferential tariff arrangement for goods that have come from the settlement.
Illegal settlements. However, we know we all know perfectly well that it's very difficult to enforce that because um, the. Arteries and the settlement areas and and the rest of Israel, green line Israel are um. You know, goods travel in and out very easily. Both heavy machinery and foodstuffs and so on. And so things can often just be labelled as product of Israel. Whereas in actual fact, as some wine people have said, for instance, they've obviously clearly actually come from the settlement areas.
So that is a difficult enforcement issue now. And it would be a difficult enforcement issue. Whatever, um, route we go down and I haven't been engaged in the conversations with Spain and with other countries, but I, I have heard from my colleagues that they, they worry about the, the actual effectiveness of the measures that they're taking. So we want to make sure that we do this correctly. Um, the question is whether there's a D, B, t route for doing these or an Fcdo route for doing all of these things.
What I and Hamish Faulkner in the Foreign Office have been doing for the last few months, is trying to look through all the details of this and get a a serious plan of action in place.
09:55
09:56
Speaker 1
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Speaker 1
Yes, it will obviously be for others to decide, because there'll be a. Continuation new government, however you want to interpret it next week. Um, but we've been doing the work on precisely how this will work and I, and I just want to underline, um, I think there's a very strong moral argument for all of this. Um, I think there's almost certainly though this would be advice from the Foreign Office, there's probably a strong legal argument for doing all of this, but actually making it effective is not as is not simple.
That's not I mean, I always think that when there are problems, you have to overcome them rather than just say, oh, well, there are problems. So we can't do anything. And this is what I said in the debate last Thursday afternoon as well. Um, and, um, I am just slightly nervous of declaratory action, which has no actual effect. Um, but as I say, I think most people in the United Kingdom would be absolutely scandalised if they thought that British financial institutions or legal institutions or whatever were providing services which were effectively allowing the further rollout of illegal settlements in Israel.
That's not I mean, I always think that when there are problems, you have to overcome them rather than just say, oh, well, there are problems. So we can't do anything. And this is what I said in the debate last Thursday afternoon as well. Um, and, um, I am just slightly nervous of declaratory action, which has no actual effect. Um, but as I say, I think most people in the United Kingdom would be absolutely scandalised if they thought that British financial institutions or legal institutions or whatever were providing services which were effectively allowing the further rollout of illegal settlements in Israel.
09:57
09:57
Speaker 5
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Speaker 5
I would I would agree fully. And as I said, there's a wider question here, which is that, you know, I've certainly been frustrated, as I said, as a minister about the, um, the capabilities and the powers that we do have to respond to issues in relation to IHL more generally in relation to our sanctions regimes. And I am regularly, uh, having cases raised with me by, by colleagues, by human rights groups, by others. And I want to make sure we've got the full, the full set of tools in our armoury to be able to, to respond.
But I mean, I would completely agree with what Chris has had to say.
But I mean, I would completely agree with what Chris has had to say.
09:57
Speaker 1
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Speaker 1
I'd just say one other thing. Sorry, just about timelines. Of course, if we are able to use the sanctions regime that already exists, um, or DBT and potential solutions, then that is better than having to rely on primary legislation, which, as you know, would take could take some considerable period of time and might get delayed in the House of Lords for all sorts of perfectly legitimate or different. Reasons. So that's why we're trying to put together. We're trying to work in granular detail on what this would look like.
09:58
09:58
09:58
Speaker 5
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Speaker 5
Yes. Sam. Obviously, as an overall framework, but within that, we have the individual regimes and then below that, individual designations on individuals and entities. And one of the challenges we have is that we don't necessarily have all the regimes in place that we would like to have. Um, and, you know, I do want to pay tribute to our sanctions team. They do incredible work at developing legally sound and effective, as Chris said, regimes, and also to ensure that we don't have unintended consequences in any of these circumstances.
We want something that actually has an impact and that has bite, and that applies to any of our sanctions regimes.
We want something that actually has an impact and that has bite, and that applies to any of our sanctions regimes.
09:59
Speaker 1
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Speaker 1
And it might just be worth saying about other countries. So Spain, for instance, I think they have a system which is sort of similar to our secondary legislation, whereby basically the cabinet makes a pronouncement, and then it has to go to both houses within 30 days. Um, there's been a bit of a dispute within the European Union as to whether individual countries can proceed down this route. But actually the UK is in a very different position from most other European countries or not. Well, from Spain and Ireland and the Netherlands, because of our particular exposure in our relationship with Israel.
So that means that there's more of an onus on us to take this seriously. But it also means that it's a bit more complicated than for others. And of course, the EU, I think, didn't manage to come to a conclusion earlier on this week, though. They had, I think, 3 or 4 different options before them.
So that means that there's more of an onus on us to take this seriously. But it also means that it's a bit more complicated than for others. And of course, the EU, I think, didn't manage to come to a conclusion earlier on this week, though. They had, I think, 3 or 4 different options before them.
10:00
Speaker 3
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Speaker 3
Um, I think Katja Keller said that the overwhelming majority within foreign ministers Council was for an outright ban. And I think they're they're now satisfied that they can do that through qualified majority voting. But, I mean, I have spent time, um, with Spanish officials understanding the implementation of the ban in Spain. Their view was that actually getting the ban in place did then give them the momentum to then work it through in detail. But what I'm hearing you both say today is that there is a moral case for a ban.
You think you have most of the legal basis for a ban, and it is now just a question of getting a detailed implementation plan in place. And that is something that you have already begun working through in detail.
You think you have most of the legal basis for a ban, and it is now just a question of getting a detailed implementation plan in place. And that is something that you have already begun working through in detail.
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10:01
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10:01
Speaker 3
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Speaker 3
Yeah. Um, the one other associated question I suppose is then about Ireland. So we obviously ensure that goods going into Ireland. Um are in. A regulated in line with EU investment. If there is an Irish ban on the importation of goods from illegal settlements, presumably there will need to be a conversation about how we stop goods from illegal settlements going into Northern Ireland, given that there are no border checks within the island of Ireland.
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10:02
Speaker 3
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Speaker 3
Um, can I just ask then about the scope?Because the argument that I've been making is that the ban should be comprehensive. So there should be a ban in both goods and services. We should be looking to prohibit UK businesses, charities and financial institutions from supporting settlement activity. We should, as you suggested, Sir Chris, restrict commercial and property transactions linked to settlements and wherever possible we should be using sanctions powers in the interest of speed. It sounds to me like you're considering quite a broad scope of ban, but have I heard you correctly?
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10:03
Speaker 7
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Speaker 7
Thank you. Chair. Uh, sir?Chris, I wonder if I could talk about legitimate. Israel can use that expression. We are allies with Israel. The Israeli government is a legitimate democratic organisation. How many licensees of each type?Export licences are live, as it were, for Israel. And where that Israeli government is a potential end user. How many of those licences are what the layman might regard?As for weapons.
10:04
Speaker 1
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Speaker 1
So it might just be worthwhile underlining that there's a difference between the licensing regime that we have for military and dual route dual use, um, material and the conversation that we've just had, which is about which is not about licensing in that regard at all. Um, so, uh, we, um, the, the figures that we released on the 20th of April show, um, that we have 395 extant licences in relation to Israel, 192 of which were non-military licences, 89 covered components for re-export to third parties outside of Israel. So, for instance, sometimes we export something to Israel.
It then gets put in something else, which then comes back to the UK for the mod. 37 were for commercial companies undergoing testing, research and development, demonstration or manufacturing purposes. Nine covered equipment for academic or civilian purposes, including protective equipment for non-combatants, and 68 of them included. Government of Israel were for um material. That is going to the government of Israel as the end user or the potential end user. Um, these are, as we outlined in the previous session for trainer aircraft missile defence systems, because we believe that Israel has the right to defend itself or components for submarines, as well as the F-35 licenses, which we discussed in some detail last time.
Um, so, uh, and between the 1st of August 2025 and the 28th of February 2026, 112 licenses were issued, the majority for non-military goods, i.e. dual use but non-military.
It then gets put in something else, which then comes back to the UK for the mod. 37 were for commercial companies undergoing testing, research and development, demonstration or manufacturing purposes. Nine covered equipment for academic or civilian purposes, including protective equipment for non-combatants, and 68 of them included. Government of Israel were for um material. That is going to the government of Israel as the end user or the potential end user. Um, these are, as we outlined in the previous session for trainer aircraft missile defence systems, because we believe that Israel has the right to defend itself or components for submarines, as well as the F-35 licenses, which we discussed in some detail last time.
Um, so, uh, and between the 1st of August 2025 and the 28th of February 2026, 112 licenses were issued, the majority for non-military goods, i.e. dual use but non-military.
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10:06
Speaker 1
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Speaker 1
They're very specific. So it's trainer aircraft. Um uh, it's missile defence systems components for submarines. Um, and then F-35 licenses. Those are the ones that are actually going to the state of Israel. Lots of there are other licenses. There's a very big licence for cystic fibrosis. Um, stuff which is worth 68 million I think. Um, which of course would not be covered in that. Um, and, and that's one of the reasons actually that the value, the total value of the licenses is higher this year than last.
10:07
Speaker 7
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Speaker 7
Okay. You've mentioned the F-35. Uh, and obviously that's, it's been controversial to say the least. I mean, it's seen as some kind of wonder weapon. We had evidence here that the only aircraft in the Israeli inventory that could lift £2,000 bombs was the F-35. I don't think that's right. I think that the Israeli version of the F-15 and F-16 can lift those bombs. But nonetheless, the F-35 is seen as a kind of a sort of a bogeyman, almost.
Have you any sense of whether or not the F-35 is being used by the Israelis over Lebanon?
Have you any sense of whether or not the F-35 is being used by the Israelis over Lebanon?
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Speaker 4
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Speaker 4
The um, we've no evidence of that. But I mean, the comment you make around F-15, F-16, the vast majority of Israeli, uh, air. Force is exactly those types of, uh, types of aircraft. I won't reopen the discussion unless the committee and the chair wants us to around, uh, the carve out for F-35 more generally. Uh, but certainly with respect to ourselves and what happens around the use of F-35, we have no particular evidence with respect to Lebanon.
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Speaker 7
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Speaker 7
Okay. So there's been no you talked there about the car before the F-35, because we were told that the F-35 supply chain is complex, that the all the parts go into one central pool, as it were. I think we have stopped sending direct to Israel. But nonetheless, obviously, the parts go into that pool, which presumably they can draw from, but we the carve out was because the F-35 pool is vital for the security of the UK. Our allies in NATO, um, that's still the case has not been a review of that.
That's still still the situation. Uh.
That's still still the situation. Uh.
10:09
Speaker 4
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Speaker 4
Mr. Cooper, just without digressing. And if I digress, the chair will bring me back. The F-35 is fundamental and, and crucial to the defence of ourselves and the defence of Europe and beyond. Um, if I just give a couple of examples, um. Last year on the carrier was full of F-35s all over the Indo-Pacific through the Middle East, Mediterranean and back to ourselves as we speak in this committee chair, as the committees will be aware, uh, we have the Prince of Wales is now in the North Atlantic with F-35s on it.
Um, securing our security in the North Atlantic and that of our allies and partners with respect to that, uh, more recently, there were newspaper reports, so it's not breaking any confidentiality, uh, F-35s based at Akrotiri following the Middle East. Um, tension shot down drones which were seeking to do damage to ourselves and our allies. But it is a fundamental part not only for ourselves, but others, for the security, for the security. That was why the decision was taken across all of the departments, for the necessity for the carve out.
Um and the difficulty for the UK to simply extrapolate itself from that, given the large percentage of parts into the 15%, I think is parts into, uh, into the. F-35, the global pool. And we had a really good discussion and challenge and, uh. A committee, I think two years ago, uh, around that and obviously the discussion continues, but for the, the mod's position and I know across government is the F-35 remains an essential part of our defence. Security for ourselves and for our allies and partners.
Um, securing our security in the North Atlantic and that of our allies and partners with respect to that, uh, more recently, there were newspaper reports, so it's not breaking any confidentiality, uh, F-35s based at Akrotiri following the Middle East. Um, tension shot down drones which were seeking to do damage to ourselves and our allies. But it is a fundamental part not only for ourselves, but others, for the security, for the security. That was why the decision was taken across all of the departments, for the necessity for the carve out.
Um and the difficulty for the UK to simply extrapolate itself from that, given the large percentage of parts into the 15%, I think is parts into, uh, into the. F-35, the global pool. And we had a really good discussion and challenge and, uh. A committee, I think two years ago, uh, around that and obviously the discussion continues, but for the, the mod's position and I know across government is the F-35 remains an essential part of our defence. Security for ourselves and for our allies and partners.
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10:10
Speaker 3
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Speaker 3
Right. Okay. Anything further on that?Thank you. Can I just check a couple of numbers?So the extant military licences. Have a value of 130 million. So, Chris, you flagged the licences for re-export. That's 81 million. Non-Governmental uses 11 million. There is then an unspecified remainder of 38 million. You've set out four different areas of extant military licences, which you've argued are for training, self-defence and submarines.
Are those the licences that make up the 38 million that you haven't broken down?
Are those the licences that make up the 38 million that you haven't broken down?
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10:13
Speaker 2
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Speaker 2
So, Israel's ambassador to the United States has confirmed that the number of flight hours Israeli pilots have on the F-35 is greater than that of all the pilots of the other foreign countries that were partners in developing this aircraft. So the F-35 is apart from maybe the our country's interpretation and evidence for it is widely being used by the Israelis own statement in multiple directions in this conflict where whether it's been Gaza or beyond. Bluntly, what it feels like is the only way that we can square our relationships with the Trump White House, with the F-35 is to sacrifice our responsibilities to the arms trade treaty.
And by by pleading ignorance about the F-35s use by Israel to commit humanitarian crimes. And I don't think that's good enough for this country.
And by by pleading ignorance about the F-35s use by Israel to commit humanitarian crimes. And I don't think that's good enough for this country.
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10:13
Speaker 4
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Speaker 4
Well, as I say, you know, our position is, as I just stated it, taking the chairs direction not to, to, to, to go over things. But as I say, the, the frank reality for, for us is that the F-35, um, is a crucial part of the security, which is the point. I won't go over that again. And our contribution of parts into the global pool allows the continued development and sustainment of that important fleet. And as Mr. Burns just reminded us, we had a really good, interesting and powerful discussion, stroke debate about that last time.
And Mr. Maynard, you know, quite rightly, you know, you made the points then and are making the points back. And the challenge to the government. But the government's position remains that the F-35 is crucial to that. But, of course, we're concerned about the things that we see, hear about with respect to that. And as Mr. Bryant laid out, the government has tried to respond to that in many ways to to do what it can to alleviate the suffering and the suffering and horror that we see.
And Mr. Maynard, you know, quite rightly, you know, you made the points then and are making the points back. And the challenge to the government. But the government's position remains that the F-35 is crucial to that. But, of course, we're concerned about the things that we see, hear about with respect to that. And as Mr. Bryant laid out, the government has tried to respond to that in many ways to to do what it can to alleviate the suffering and the suffering and horror that we see.
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Speaker 10
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Speaker 10
Thank you. Chair, I'd like to ask, uh, some. Questions about re-export. Um, and so Minister Bryant, um, specifically the Campaign Against Arms Trade, the NGO that you'll be familiar with, says that UK exports of drone parts to Israel have not been re-exported to Romania from Israel. And that was a requirement of the UK export licence. Will the items listed in Cat's Letter be re-exported to Romania?
10:17
Speaker 1
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Speaker 1
So this is the question about Watchkeeper drones, I think. Yes. So we've investigated all these reports as as you would expect us to do. And we understand that they, they they are delayed. We do. We assess the risk of diversion as very low. Um, we, uh. And I diversion to the IDF, which I think is the central question that's being asked. Um, they are delayed, but um, we believe that they are, uh.
They're still going to be going to Romania.
They're still going to be going to Romania.
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10:21
Speaker 1
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Speaker 1
Well, it's difficult to have a system of post. Shipment checks, not least because you have to have the other country. Obviously agreeing that you're going to allow that to happen. So in this case it will be happening in Israel. Um we've looked at other countries that have done something similar in this kind of area. The United States of America has a it does, I think, less than 1% are looked at. And that system costs them something like two and a half.
point two, $2.25 million a year. Um, so we and the main thing that we try to do, of course, is long before anybody exports something, we try to make sure that we've assessed, which is one of the things that the Foreign Office will do on our behalf or Mod. We try to assess whether there is any risk of of diversion. Category seven um, diversion risk is one of the main reasons why we reject licences. So I think we are very rigorous about this.
Um and of course we get concerned when we see things that might be delayed and looks like they're just sitting there. Um, but um I don't think that's the case here.
point two, $2.25 million a year. Um, so we and the main thing that we try to do, of course, is long before anybody exports something, we try to make sure that we've assessed, which is one of the things that the Foreign Office will do on our behalf or Mod. We try to assess whether there is any risk of of diversion. Category seven um, diversion risk is one of the main reasons why we reject licences. So I think we are very rigorous about this.
Um and of course we get concerned when we see things that might be delayed and looks like they're just sitting there. Um, but um I don't think that's the case here.
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10:22
Speaker 9
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Speaker 9
Well, I mean, we continue to, but I mean, there have been discussions with the relevant UK exporters to understand what what's going on. I mean there does seem to have been a delay, as the minister has said. But there's nothing in those conversations, uh, which suggests any risk of diversion, uh, including UK parts to, to the IDF. Um, if anything that changes, of course we would want to take further action.
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10:23
Speaker 10
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Speaker 10
Just on the point about post shipment checks. Uh, I appreciate that the United States system, uh, is, is quite large and significant. Uh, the last report of the committees on arms export Controls suggested that the UK should implement a pilot of post shipment checks. What consideration is being given to even piloting such a system?
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10:23
Speaker 1
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Speaker 1
I suppose the decision for any minister in this post would be, where are you going to put resources?Are you going to put more resources into doing post shipment, or are you going to do more resources into making sure that we've got it right in the first place?And we've got a pretty good record on assessing diversion?We're pretty aggressive in in and obviously with lots of companies, we're dealing with people that we deal with regularly. Um, and so if, if I were asked that question in three months time, I would put all the, all my eggs in the pre assessment rather than in the post.
Um, because frankly, once it's gone, you've got fewer powers to affect a change.
Um, because frankly, once it's gone, you've got fewer powers to affect a change.
10:24
Speaker 5
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Speaker 5
And if I might add chair, um, which might help you, I can, I can assure you that you know, both, uh, what, what Chris said about, uh, the use of, um, criterion seven and the extent that we look at this, this is based also on long standing, looking at the records of what's happened previously, the assurances that we have, uh, assessment we've done because as Chris says, it's most crucial to get this done beforehand. Once something has gone somewhere it shouldn't have. Um, you know, you've got very, very limited ability to, to, to take action except to try and put steps in place in the future.
And the teams go through this in granular detail. And certainly when the most risky decisions come up to a ministers, including myself, um, this is one of the most common things that I ask that I look at, that I go through in granular detail and look at the history of, um, and any possibility, and I can tell you, I take an extremely cautious approach to any risk of diversion.
And the teams go through this in granular detail. And certainly when the most risky decisions come up to a ministers, including myself, um, this is one of the most common things that I ask that I look at, that I go through in granular detail and look at the history of, um, and any possibility, and I can tell you, I take an extremely cautious approach to any risk of diversion.
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10:25
Speaker 1
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Speaker 1
Yes, of course, but I mean, just to be absolutely clear, the government of Israel is not a party on this licence in any shape or form. So it would be a breach. It would be a fundamental breach. And and and if the company ever wanted to do business with us again, they would be in a very difficult place.
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10:25
Speaker 2
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Speaker 2
Yeah. Mr. Bryant, just just following up on the principle in terms of, you know, we want the UK to be be taken seriously in terms of what we what we what we mean is, is what we say is what we mean, and we will enforce it. So to your point, also, Mr. Doughty, about granular detail, to me it's very logical saying, well, if I'm exporting weapons to to you, then one of those commitments is you're not going to forward it on to somebody. I don't want you to forward it on to.
And therefore you will make me the promise that if I ask, where is that now?You will tell me. And. Right. But that's. But that pilot scheme that Richard Ford is asking for, my colleague would provide teeth to that. And I'm I'm interested and intrigued. Why not exploring a pilot scheme to demonstrate that we've got some teeth and some backbone to make sure that what we want to have happen happens. Why that's not in our national interest.
And therefore you will make me the promise that if I ask, where is that now?You will tell me. And. Right. But that's. But that pilot scheme that Richard Ford is asking for, my colleague would provide teeth to that. And I'm I'm interested and intrigued. Why not exploring a pilot scheme to demonstrate that we've got some teeth and some backbone to make sure that what we want to have happen happens. Why that's not in our national interest.
10:26
Speaker 1
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Speaker 1
Well, I'm only assessing if I had to choose where to place resources, would I put more resources into that?Because this is always a question about resources. In the end, it's all very well to say, let's have a pilot on this, that and the other. We've looked at other countries who have, um, some form of system. I think Germany does. Is it. No, you didn't let me finish the sentence. I think Germany does 7 or 8 a year.
Um so it's a tiny and we're trying to assess from them whether it has any um value at all. Because I don't want to do something which has no value. And, and at the moment, whatever we do has to be proportionate to the risk. Now we assess the risk very rigorously, both in the Foreign Office, Stephen and then myself, when, when a licence come up comes up to us, you know, one of the first questions is, is have we assessed the risk of diversion?Um is this a company that we've dealt with frequently.
And so on. So I think we've been getting this right.
Um so it's a tiny and we're trying to assess from them whether it has any um value at all. Because I don't want to do something which has no value. And, and at the moment, whatever we do has to be proportionate to the risk. Now we assess the risk very rigorously, both in the Foreign Office, Stephen and then myself, when, when a licence come up comes up to us, you know, one of the first questions is, is have we assessed the risk of diversion?Um is this a company that we've dealt with frequently.
And so on. So I think we've been getting this right.
10:28
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10:29
Speaker 5
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Speaker 5
I can't give you a timeline. But what I would say is there are there are some genuine resource constraints in terms of getting these things right. And you'll appreciate chair as well that again, getting the regime right is crucial. Excuse me, getting the regime right is crucial because what we don't want to do is then face a huge amount of litigation in the opposite direction, which then gums up the whole system and actually affects the the impact on the ground. And, and we are subject to a huge amount of litigation, as you can imagine, in relation to sanctions from those who don't like being sanctioned.
So, um, it's important that we have it, have it right from the start. Um, the team are adequately resourced. They know this is a priority. And we're also of course, looking at a huge range of other sanctions regimes. Um, and obviously it will be for us, a new prime Minister to make a decision on as well about resourcing, um, within departments as well to ensure we can make these things move forward quickly.
So, um, it's important that we have it, have it right from the start. Um, the team are adequately resourced. They know this is a priority. And we're also of course, looking at a huge range of other sanctions regimes. Um, and obviously it will be for us, a new prime Minister to make a decision on as well about resourcing, um, within departments as well to ensure we can make these things move forward quickly.
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10:31
Speaker 1
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Speaker 1
You see, I knew that's where he was going to go. I'm not going to give you a timetable. I'm afraid. Not. Least because who knows who'll be making these decisions in a week's time. Um, but, um, and I haven't got a timeline to give you. We're working on it with some urgency and determination. We want to make sure that we get this right. I don't want to underestimate the challenges that that will pose.
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10:32
Speaker 5
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Speaker 5
Um, so let me be clear from the outset, um, Miss Harding, um, what is happening in Sudan is utterly appalling and despicable. And the, uh, the. Foreign secretary and indeed a previous foreign secretary, you know, two of the, you know, leading lights in terms of actually shining a light on what has been happening and not only taking the action, exposing and urging international action, but also raising that at the highest levels, including, um, with all of those countries that are involved in any way in facilitating and furthering this conflict.
Um, we think there are multiple countries who have entities and individuals who are arming and facilitating. This conflict on both sides. We urge them all to stop. Um, we raised this at the highest level, all of them. And as you can imagine, that would also include in our conversations with the UAE and others.
Um, we think there are multiple countries who have entities and individuals who are arming and facilitating. This conflict on both sides. We urge them all to stop. Um, we raised this at the highest level, all of them. And as you can imagine, that would also include in our conversations with the UAE and others.
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Speaker 5
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Speaker 5
Well, you can imagine, yes. The UAE is one of the countries we've spoken to, uh, and are indeed a number of other countries that we've spoken to. Um, we're very, very clear that any weapons or arms going in are making this conflict even worse. They're fuelling atrocities. Uh, this must absolutely end immediately.
10:34
Speaker 11
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Speaker 11
So the, the reason why the UAE is significant is because the RSS, um. It was found after the fall of El Fasher that the hallmarks of the genocide, that there was a reasonable inference of genocidal intent, crimes against humanity and ethnic cleansing. And it is widely reported and by many accepted that the UAE are funding the RSS. So the UAE stand apart from some of the other countries.
10:34
Speaker 5
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Speaker 5
I think it's important to be accurate here. There are multiple countries, and the Foreign Secretary said this yesterday in her evidence to the Foreign Affairs Committee who are fuelling this conflict. They all need to end their arming both sides. Um, they're supporting both sides. Um, this must end. I mean, the atrocities and what you describe what happened in Al-fashir. Um, I mean, as somebody who's worked on issues in relation to Sudan for a very long time, including before coming into this place, uh, some of the things that I just just extraordinary and having a number of Sudanese diaspora in my own constituency who've come and talked to me about the implications of what is happening in Sudan and today.
And what we've seen is just simply unthinkable. Every country, every entity, and every individual who is fuelling this conflict on either side needs to stop doing so immediately.
And what we've seen is just simply unthinkable. Every country, every entity, and every individual who is fuelling this conflict on either side needs to stop doing so immediately.
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10:35
Speaker 5
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Speaker 5
So, um, our instigation and I was certainly personally involved in this. We conducted a full review of over 3000 licences and their end users to countries in the region. And that includes the UAE. Um, but the conclusion of that was clear. There is no evidence of UK weapons or ammunition being used in Sudan. Um, you know, I really want to be clear with the committee about that. We've we've taken a fine tooth comb through this, and you can be absolutely assured that in terms of the diversion risk, in terms of all the matters we've just been discussing in relation to wider export policy, this is a key consideration.
Um but we are clear from our review that there is no evidence of UK weapons ammunition being used in Sudan.
Um but we are clear from our review that there is no evidence of UK weapons ammunition being used in Sudan.
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10:36
Speaker 5
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Speaker 5
With respect, I mean, you will understand that, not least given the current situation in the Middle East and the important, uh, ability of Gulf partners and allies to respond to, again, horrific attacks on their, cities and businesses and indeed, our interests in the region as well, that they have to have the right to defend themselves. They have legitimate defence and security interests, which we engage with. Um, but in relation to anything that could possibly be used to fuel this conflict, we're clear that no UK exports are we've gone through all of those licences.
We consider this incredibly seriously. And the most important point here is that all countries and as I said, there are multiple that are fuelling all sides of this conflict need to end doing so.
We consider this incredibly seriously. And the most important point here is that all countries and as I said, there are multiple that are fuelling all sides of this conflict need to end doing so.
10:37
Speaker 1
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Speaker 1
Can I just add this might be helpful. So just Steven's absolutely right that as you know, the Eju is a is a joint venture between the three departments. And we reviewed 3000 licences. 2000 of them were in relation to Sudan. Um, and precisely as Steven said, we didn't find any instance. Obviously the top line, the most important thing for us is to establish whether UK businesses were selling something to UAE, which might then be diverted to Sudan. We are very confident that that has not happened.
And we also instructed HMRC to inspect uncontrolled, to inspect a bunch of uncontrolled shipments to Sudan and South Sudan to assess whether there is a military end use. So I'm pretty confident that on that specific issue, we have done everything that we should, and Stephen and I have both personally been reviewing quite a lot of this material ourselves.
And we also instructed HMRC to inspect uncontrolled, to inspect a bunch of uncontrolled shipments to Sudan and South Sudan to assess whether there is a military end use. So I'm pretty confident that on that specific issue, we have done everything that we should, and Stephen and I have both personally been reviewing quite a lot of this material ourselves.
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Speaker 5
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Speaker 5
But but I'm sure, Miss Harding, you're not suggesting that the UAE should not, for example, be able to defend itself against, um, you know, missiles coming in from Iran or, or any other attacks on its, um, cities or civilians or infrastructure or indeed our interests there as well. So, um, with respect, you know, there are legitimate exports. Um, there's then the silk we consider all of our exports against that. And if we think there is a risk of them being used in violation of the silk, then we would refuse licences.
10:38
Speaker 1
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Speaker 1
And I know you don't like us talking about diversion, but nonetheless, it's one of the key things that we that is vital to us because otherwise you're basically talking about a total arms control ban on for UAE. But, um, between 2021 and 2025, there were 29 um, seal. Refusals for the UAE. Um, the majority of which were refused on the basis of diversion. So we do, we take this very seriously. And we have done since 2021.
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10:39
Speaker 5
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Speaker 5
I completely reject that. And the Foreign Secretary has a regular contact with her counterparts in UAE and Frank and, and robust conversations, as you would expect with any partner and, um, over, over such matters. And, you know, we've been, we've been clear in doing that and raising those concerns.
10:39
Speaker 2
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Speaker 2
Yeah. I just want to go back to the beginning. So, so I'm not talking about any other countries. I've talking about the UAE here. Are they arming the ISF given the widespread reporting in the international press, is that something you accept or you or you don't know or there is insufficient evidence?Because whether it's the New York Times, the Reuters, the Ft and bunch of others, there's tons and tons of evidence out there in the public domain. I'm sure you have a lot in the private domain as well.
Are you can you give a clear answer, please?Whether you believe that's not true or there's insufficient evidence, despite the wall of evidence that has been provided to the public domain, please tell us whether the UAE is arming the CSF or not.
Are you can you give a clear answer, please?Whether you believe that's not true or there's insufficient evidence, despite the wall of evidence that has been provided to the public domain, please tell us whether the UAE is arming the CSF or not.
10:40
Speaker 5
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Speaker 5
So, as the Foreign Secretary said yesterday, and as I've just said, there are multiple countries I've. Already I've already answered the points. Miss Harding, there are multiple countries. It's important to remember that this conflict is being fuelled by two sides and by multiple partners arming and aiding and supporting both sides. That. All of that needs to stop. And we are raising concerns with every single country that is involved or has individuals or entities fueling this conflict, and we're doing so at the highest levels and being very, very clear about that, including in our conversations with the UAE.
10:41
10:41
10:41
Speaker 2
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Speaker 2
Okay. Right. So so let's talk about, you know, we all accept there's tens of thousands of people being killed in Sudan now. Yes. And the CSF is in large part responsible for that murder. Got my my turn to finish actually now. So so criterion one of our obligations under silk criterion one. One A, B and F is about our obligations as a country to the UN and the organisation for Security and Co-operation in Europe.
About governing conventional arms transfers. Yeah. And then in criterion six B one and two sets out our obligations about that. Further, what I would like to understand is whether you are confident and if so, why you are confident that we are not breaching criterion one, A, B and F, or criterion six, B one and two by selling any weapons to United Arab Emirates. Given what they are doing in Sudan by arming the CSF.
About governing conventional arms transfers. Yeah. And then in criterion six B one and two sets out our obligations about that. Further, what I would like to understand is whether you are confident and if so, why you are confident that we are not breaching criterion one, A, B and F, or criterion six, B one and two by selling any weapons to United Arab Emirates. Given what they are doing in Sudan by arming the CSF.
10:43
Speaker 5
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Speaker 5
So, as you know, criterion one, as you pointed out, is concerned with the UK's international obligations and commitments, including sanctions from the UN Security Council. They are fact specific assessments. We have not yet seen evidence that UK exports are inconsistent with those obligations. Um what we do, of course, is we consider all of the Selke criteria. And also they have different thresholds, different criteria that need to be met. The most commonly used is the one in relation to criterion seven.
Team will correct me if I'm incorrect on that. Um because of the nature and the risk of diversion, I know you don't want to talk about that. That is absolutely crucial because it's again about whether UK exports are ending up fuelling this conflict. Our assessment is that that is not the case. And, uh, you know, again, it comes back to the point that Mr. Bryant was just raising with Miss Harding and that I was as well. Is that, of course, the UAE has a right to be able to defend itself in its its region.
We, of course, have legitimate exports in that regard. We are absolutely clear that UK exports are not going via the UAE and fueling this conflict.
Team will correct me if I'm incorrect on that. Um because of the nature and the risk of diversion, I know you don't want to talk about that. That is absolutely crucial because it's again about whether UK exports are ending up fuelling this conflict. Our assessment is that that is not the case. And, uh, you know, again, it comes back to the point that Mr. Bryant was just raising with Miss Harding and that I was as well. Is that, of course, the UAE has a right to be able to defend itself in its its region.
We, of course, have legitimate exports in that regard. We are absolutely clear that UK exports are not going via the UAE and fueling this conflict.
10:44
10:44
Speaker 5
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Speaker 5
We have obligations under the entirety of the. It we consider we consider all of them in relation to each individual decision. That is an extremely forensic and careful process. This is this is an extremely forensic and careful process. And I can assure you, not least given the work that we have done to highlight what is happening in Sudan are absolute condemnation on it on the international stage, including in the United Nations and the work the Foreign Secretary, that this has taken incredibly seriously.
Each one of the criteria, and we take the decisions appropriately. And Chris has set out very clearly, um, how we have rejected a number of licences and how we consider all of the licences and how we've reviewed all of them.
Each one of the criteria, and we take the decisions appropriately. And Chris has set out very clearly, um, how we have rejected a number of licences and how we consider all of the licences and how we've reviewed all of them.
10:45
Speaker 3
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Speaker 3
Okay. Can I make a suggestion?So when we had the debate that we had last year on the F-35 carve out, we had a very useful exchange of correspondence that really kind of helped us establish the decision making criteria that the government had used to construct a legal basis for continuing with F-35 exports. The point that Mr. Maynard is raising the challenge that we have is how to square the full meaning of criteria one, with a decision to continue allowing licences. Um, and so it could be that we follow up in writing just to try and really crystallize.
very happy to do the legal judgments and the balancing tests that you have undertaken. And in order to arrive at the decision that you've arrived at, and it could well be, Sir Chris, that it's a joint piece of correspondence between yourself and Mr. Doughty.
very happy to do the legal judgments and the balancing tests that you have undertaken. And in order to arrive at the decision that you've arrived at, and it could well be, Sir Chris, that it's a joint piece of correspondence between yourself and Mr. Doughty.
10:45
Speaker 1
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Speaker 1
I'm very happy to do that. I just want to add two bits to what Stephen said. The first is that when we decide to grant or refuse a licence, obviously there are aggrieved parties at either end of that decision. Um, and so we have to make sure that we are fulfilling not just the, the, the letter of the law, but the spirit of the law. But most importantly, obviously, the letter of the law. And so the threshold for, for criteria one, two, three, and four, um, is quite a high threshold, which is clear risk.
Um whereas for five, seven and eight um it's, we have more discretion in a sense because it's things that we can take into account. And then. Six as Mr. Maynard has just referred to, is split into two halves. So I'm very happy to write about how all of this applies to individual cases. But we are cognizant of the fact that if we turn down a licence, the the company might turn to us and say, well, hang on, we want to challenge that.
Um, so that's why we have to get it absolutely right.
Um whereas for five, seven and eight um it's, we have more discretion in a sense because it's things that we can take into account. And then. Six as Mr. Maynard has just referred to, is split into two halves. So I'm very happy to write about how all of this applies to individual cases. But we are cognizant of the fact that if we turn down a licence, the the company might turn to us and say, well, hang on, we want to challenge that.
Um, so that's why we have to get it absolutely right.
10:47
10:47
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10:48
Speaker 12
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Speaker 12
Yes. Thank you. Uh, Sir Christopher, you just helpfully set out the, um, criteria that you operate under and the, what you described as discretionary, uh, criteria five, seven, and eight. Um. Why why are there any factors that you need to take into account?Why are they not mandatory?So for example, criterion five National Security UK. Surely that ought to be a mandatory criterion.
10:49
Speaker 1
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Speaker 1
Well, I mean, the way that silk was written, I can't remember what year they were introduced. Um some 20, 21, some time before I came into post. Um, and so we've been operating against those criteria. There's an advantage to keeping the criteria consistent because that means that companies are able to, um. Know how they can operate with us and what they have a degree of predictability and about what licences will and won't be granted. Um, but I presume you've got a follow up, which is going to be more difficult.
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10:49
Speaker 1
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Speaker 1
It's my fault, but perhaps discretion is the wrong word. What I simply mean is that the threshold under, um, one, two, three, four, and half of six is very, uh, is quite a high threshold. You have to have clear risk. And that is a fact based, um decision. And then under the others, we can take things into consideration, take, take them into account. That's the only distinction that there is. Um, but as I say, when decisions come up either to officials or to me, we are Either to officials or to me.
We are using the criteria that exist.
We are using the criteria that exist.
10:50
Speaker 4
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Speaker 4
Okay, so just just looking at criterion seven, which is the risk risk of diversion, which I think you've you've you've all said quite a lot this morning is a really important. There's, there's been over 400 refusals on that criteria, although I think I'm right, aren't I, that you can you can double count in terms of reasons for refusal. So it may it may it may be refused on other grounds, but that that is by far the largest ground for refusal. Does does that give you any cause to think.
Well, actually we need to sort of look at whether that should now be a mandatory issue because that that's clearly coming up as a pattern.
Well, actually we need to sort of look at whether that should now be a mandatory issue because that that's clearly coming up as a pattern.
10:51
Speaker 1
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Speaker 1
No, I think, um, I've that point hasn't been made to me previously. Um, I'm happy to think about it, but I'm content with where we're at. I mean, one of the difficulties that we sometimes face, obviously, I want us to be able to decide as many of these as swiftly, as swiftly as we possibly can. But that isn't always easy because we want to be able to, um. Do all due diligence before we grant a licence to make sure that we think that there isn't going to be diversion.
And that can sometimes take quite a bit of time.
And that can sometimes take quite a bit of time.
10:51
Speaker 4
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Speaker 4
I'll just ask you then about criteria six, which um, there's not been refusals for the previous few years, but sorry. That's behaviour for the buyer country. With regard to international community, there is now one that's popped up on the uh report we received yesterday. Are you able to give us any any more details to, to to. That particular refusal.
10:52
10:52
Speaker 4
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Speaker 4
Better ask, um, can I then just ask um, uh, a slightly broader. There's obviously been a number of high profile, uh, convictions for, uh, export control breaches in, in, well, the last few months actually. Um, is that indicative of, uh, greater activity, greater sort of awareness of enforcement, more resources being put into it?Is this part of a wider pattern around the world?What's going on?
10:52
Speaker 1
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Speaker 1
Well, as you know, when we came to the committee, um, in, in private earlier on this year and had a bit of a kind of open heart session, um, we, one of the things that I've been concerned about is trying to make sure that we are able to name and shame instances because it looks terrible if we haven't, if basically somebody gets fined and nothing more and nobody even knows what the instance was. Um, so, but as I said then, one of the problems with that is that quite often one of the, one of the, um, the HMRC negotiated settlements with the individual company will be that they're being fined x £100,000 or whatever it may be.
Um, and with a guarantee of anonymity. So we've been trying to remove that. And we have recently, um there's one particular licence which is going to be pointed to me now, um where we have been able to give the details, which was Petrofac Facilities Management Limited, which only in June, um, was the first one that we've been able to name for breaches of Russian sanctions. They, they paid a settlement of £569,000. So this is a shift. We want to do this more.
I would like to see more prosecutions. You could argue that if there aren't many prosecutions, it's because we're actually doing a good job. And because the vast majority of people, um, do want to in this territory are frequent customers of ours. And they, they don't want to get themselves into trouble because then that's the future of their business down the drain.
Um, and with a guarantee of anonymity. So we've been trying to remove that. And we have recently, um there's one particular licence which is going to be pointed to me now, um where we have been able to give the details, which was Petrofac Facilities Management Limited, which only in June, um, was the first one that we've been able to name for breaches of Russian sanctions. They, they paid a settlement of £569,000. So this is a shift. We want to do this more.
I would like to see more prosecutions. You could argue that if there aren't many prosecutions, it's because we're actually doing a good job. And because the vast majority of people, um, do want to in this territory are frequent customers of ours. And they, they don't want to get themselves into trouble because then that's the future of their business down the drain.
10:54
10:54
Speaker 6
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Speaker 6
Um, I mean, there's only been one licence refusal under criteria six since 2022 I think. Um, I mean is there any particular reason for that. So this is the criteria behaviour of the buyer country with regard to the international community. Just given what is going on in the world, that seems a strangely low number of refusals. It could be that you're able to can these applications more expeditiously using other criteria.
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10:55
10:55
Speaker 7
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Speaker 7
As I'm sure you're aware the committee's aware it's an internal review for clarity. Does not include plans to review the strategic export licence and criteria within this review. So this particular review dealing with internal processes, how things are done, uh, how they could be done better, the collection of data, more transparency, all of those things where we're at, um, for, for complete clarity is putting together the terms of reference for that review. We're going to, um, if you let me get to the end of this, because it's good news for the committee.
There's a draft draft draft at the moment, but we clearly, in coming to the committee, we'd like the committee's view on on the progress for that.
There's a draft draft draft at the moment, but we clearly, in coming to the committee, we'd like the committee's view on on the progress for that.
10:55
10:56
Speaker 7
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Speaker 7
Given the significance of some of the conversations we've had in committee this morning and some of the serious, um, dilemma. Um, and as all the three of us have said, our desire to be as open and transparent as possible whilst recognising some of the difficulties that we face. I want the terms of reference done as soon as possible.
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10:57
10:57
Speaker 1
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Speaker 1
I was only going to say that one of the things that we've already instituted is the open general export licence changes, which we brought in in June. For EU members and a couple of others. So Canada, the United States of America, Australia, New Zealand, Japan, Norway and Switzerland, and to include South Korea, Singapore, Chile. Um, and that's just trying to simplify the, the, because everything we do is, is based on a risk assessment and where the risk is low and where we're dealing with allies, then obviously that is a much simpler situation than it is in other countries where, as you know, the other thing that we've also introduced this year is, um, for categories that don't fall under military or non-military, um, where, where we have higher risk concerns, we have an end use and control system as well now.
10:57
10:57