Sanctions and Anti-Money Laundering Bill [HL]

Lord Ahmad of Wimbledon Excerpts

Report stage (Hansard - continued): House of Lords
Monday 15th January 2018 Lords Chamber

Moved by

[Lord Ahmad of Wimbledon]

23: Clause 2, page 4, line 2, after “received” insert “, procured”

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Moved by

[Lord Ahmad of Wimbledon]

27: Clause 9, page 9, line 36, leave out subsection (3) and insert—
“(3) Regulations under section 1 which contain a designation power must provide that where an appropriate Minister—(a) has made a designation under the power, or(b) has varied or revoked a designation made under the power (see section 18),that Minister must without delay take such steps as are reasonably practicable to inform the designated person of the designation, variation or revocation.(3A) The regulations may include provision, additional to that required by subsection (3), as to steps to be taken as regards notification or publicity where a designation has been made under the designation power or a designation made under the power has been varied or revoked.(3B) The regulations need not require a person to be notified of an intention to designate the person.”

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I thank all noble Lords again for their constructive engagement on this group of amendments. The government amendments I have tabled have been heavily influenced by the discussions we have had. Amendment 28 would require regulations to include provisions on notifying a person once designated and how to publicise designations. I am happy to say that government Amendment 27 does exactly that. When a person has been designated, or had their designation varied or revoked, the Minister must, without delay, take such steps as are reasonably practicable to inform the person. Sanctions regulations may also include further provision as to the specific arrangements for notification or publicity. In this regard, I am extremely grateful to the noble and learned Lord, Lord Judge, and the noble Lord, Lord Pannick, for their assistance.

Amendment 29 would require a person to be informed of their designation and to be given the fullest possible account of the reasons for designation and the steps required to address the concerns. Amendment 30 covers similar ground, while also requiring that the designated person be given the evidence underlying the designation or a gist of any evidence that is withheld for reasons of national security. In response, government Amendments 32, 37 and 59 make provision across the Bill to provide a statement of reasons to designated persons. When a person is designated, the Government will be obliged to provide a statement of the matters that the Minister knows, or has reasonable grounds to suspect, have led to the designation. I am sure noble Lords will appreciate that the Minister’s statement may exclude some matters, for reasons which I know noble Lords will understand and respect, such as when it is in the interests of national security. If a challenge is made in court, on those rare occasions when sensitive information is used to underpin a designation, the closed material procedure will apply. The courts, such as in the case of AF (No. 3), have long required the gist of sensitive material to be disclosed to enable an individual to understand the case against them. We accept that this is and will continue to be the case and the Bill does not seek to make any changes to the existing disclosure burden on the Government in such cases.

Amendment 38 would insert a new clause into the Bill requiring the appropriate Minister to exercise the power to designate only to the extent that it is proportionate to do so, having regard to the purpose of the designation and the impact on the person concerned. The government amendments I have tabled in response—Amendments 31, 36 and 58—use very similar language. They would require Ministers to consider that a designation is appropriate, having regard to the purpose of the regulations and the likely significant effects of the designation on the person concerned. I am again grateful to the noble Lord, Lord Pannick, and the noble and learned Lord, Lord Judge, for supporting these government amendments. While there seems to be a meeting of minds on this important issue, it may also be helpful if I briefly explain the thinking behind the Government’s revised language.

First, the European Convention on Human Rights entrenches individual rights, obliging the Government to consider the impact on an individual’s rights when making certain decisions. Section 6 of the Human Rights Act 1998 further ensures that the appropriate Minister must act in line with those convention rights, as informed by Strasbourg case law. We consider that this includes satisfying himself that the designation is proportionate, where convention rights are engaged, and I have been clear on this in relation to this Bill, including in Committee. Secondly, given that the Human Rights Act already requires proportionality to be considered where convention rights are engaged, a court might interpret the use of the word in the Bill to mean something different. Our amendments have tried to preserve the spirit of the intention underlying this amendment, without creating any difficulty of interpretation. As a result, the government amendments provide for a balancing test for designations between the purpose of the regulation and the impact on the individual, while avoiding an explicit reference to “proportionality”.

Amendment 50 requires the Government to provide specific guidance produced by the Crown Prosecution Service about the prosecution of sanctions breaches. The Government wholeheartedly support and have publicly committed to producing clear and accessible guidance on sanctions implementation and enforcement, both in this House and throughout our consultation on the White Paper. The Crown Prosecution Service already publishes guidance on how the public interest is taken into account in any decision to prosecute and this test is the same one that will be applied in decisions to prosecute sanctions offences. The procurator fiscal in Scotland and the Public Prosecution Service for Northern Ireland publish similar guidance. The Government’s view is that no additional public interest guidance is necessary simply for a sanctions prosecution decision.

The Bill will provide for the Government to issue guidance on the content and implementation of sanctions. Clause 36 requires Ministers to issue guidance about any prohibitions and requirements imposed by sanctions regulations. There will be a mandatory requirement to provide comprehensive guidance for all those affected by sanctions implementation. Clause 36 is a more comprehensive duty than that specified in the amendment to Clause 16 which I have said is unnecessary. It has been drafted so as to allow comprehensive guidance on all sanctions prohibitions and requirements to be prepared and consulted on by the appropriate sources of expertise. For financial sanctions, the Office of Financial Sanctions Implementation has already published a comprehensive guidance document setting out its general enforcement approach. This will be fully updated to reflect the new sanctions Bill regime.

Amendment 53 requires the Minister to respond,

“as soon as reasonably practical”

to a request to vary or revoke a designation. Government Amendments 56 and 61 are fully in line with this proposal.

Finally, government Amendments 51, 52, 57 and 60 make technical changes consequential on these changes, and I hope they will be accepted. I beg to move.

[Lord Pannick (CB)]

My Lords, I have tabled, with the support of the noble and learned Lord, Lord Judge, the noble Lord, Lord Collins of Highbury, and the noble Baroness, Lady Northover, a number of amendments in this group on the subjects of procedural fairness and proportionality. The Minister acknowledged in Committee that these were topics that he and the Bill team would need to consider before Report. Given the adverse consequences of being designated, the Bill must provide for procedural fairness and the provisions must be applied in a proportionate manner. Again, I thank the Minister and the Bill team for some very helpful meetings on these subjects, and for tabling these amendments, which address my concerns.

In particular, government Amendments 31, 36 and 58 will require the Minister to be satisfied that any designation is appropriate, having regard to both,

“the purpose of the regulations … and … the likely significant effects of the designation”,

on the person concerned. That addresses the substance of my Amendment 38 on proportionality. It does not use the word “proportionality” but that does not matter. It contains the essence of proportionality and I am grateful to the Minister for confirming in his opening remarks that that is indeed the purpose of these government amendments.

Government Amendments 32, 37, 59 and 61 are also very important in placing in the Bill a requirement of procedural fairness; that is, that the person designated is entitled to a statement of the reasons why he or she has been designated. That is absolutely fundamental to any fair sanctions procedure. I recognise that the government amendments exclude any right to information the disclosure of which would harm interests such as national security, but they rightly provide that these exclusions will not allow the Minister to provide no statement of reasons. I would be grateful if the Minister could confirm that the intention here is to ensure that a person who is designated will always be entitled to at least a statement of the essence of the reasons for the designation, albeit that details which affect national security or other protected interests cannot be disclosed.

In the light of these government amendments, I am satisfied that the Bill now makes it clear that procedural fairness and the substance of proportionality are part of the administrative machinery. The Minister made it clear in Committee that this was always the intention and he made it clear—and I respectfully agree with him—that the courts would in any event hold Ministers to such basic standards of the rule of law. I am pleased that the Minister has recognised that it is appropriate to include these matters in the Bill and I thank him.

[Lord Lennie (Lab)]

My Lords, I am also grateful to the Minister. Clearly, he has listened a lot and has provided a lot of change from the initial version of the Bill. There is a meeting of minds—there is no question about that—but the one issue that I am not sure he addressed was about the requisite steps that persons are expected to take to address the concerns which led to the designation in the first place. I would like the Minister to comment on that, but we support the changes.

[Lord Ahmad of Wimbledon]

My Lords, again, I thank noble Lords. The noble Lord, Lord Pannick, asked me to confirm that the Bill makes no provision to change the ability of the designated person to be given the reasons for their designation and to be supplied with an irreducible minimum of the evidence against them. The only issue is that we have always said there would be national security elements. The amendment specifically says that,

“the regulations may not authorise the Minister to provide no statement of reasons”,

which I am sure the noble Lord has noted.

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Moved by

[Lord Ahmad of Wimbledon]

31: Clause 10, page 10, line 10, leave out paragraph (b) and insert—
“(b) considers that the designation of that person is appropriate, having regard to—(i) the purpose of the regulations as stated under section 1(3), and(ii) the likely significant effects of the designation on that person (as they appear to the Minister to be on the basis of the information that the Minister has).”

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Moved by

[Lord Ahmad of Wimbledon]

33: Clause 11, page 10, line 33, leave out “authorise” and insert “grant a power for”

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[Lord Collins of Highbury (Lab)]

My Lords, I thank the noble and learned Lord and noble Lords for their contributions. I agree wholeheartedly with their comments in relation to the thrust of this legislation. We are here because of another decision. We are here because we are being forced to take action speedily because of the precipice that we will be facing.

I said at Second Reading and will say now that we support this Bill because we are required to have a proper and full sanctions regime. I completely share the concerns expressed by your Lordships’ Constitution Committee. But, as I said in Committee, your Lordships’ Delegated Powers and Regulatory Reform Committee examined these clauses in some detail and did not quite share the view of the Constitution Committee. It referred to its previous memorandum on the subject and said that the reason for this clause related to the enforcement of the prohibitions and requirements set out in the regulations. In Committee, the Minister said that the Government were replicating existing enforcement regimes. He said:

“To be clear: these types of offences already exist”.—[Official Report, 21/11/17; col. 165.]


In Committee, I said that if that was the case, and the Minister was hearing us in terms of the concerns over principles, I hoped that he would come up with something better to address the concerns of the Delegated Powers and Regulatory Reform Committee. I am afraid that, as the noble and learned Lord, Lord Judge, said, I do not think that the Minister has come up with adequate provisions to address these concerns. They are limited, as the noble and learned Lord said, to some of the all-embracing powers such as determining evidence and the process for evidence. I welcome those changes but I do not think that the Government have gone far enough in terms of being very clear how these wide-ranging powers will be dealt with. If the noble and learned Lord presses this issue, I hope that the House will support him.

[Lord Ahmad of Wimbledon]

My Lords, first, I thank the noble and learned Lord for tabling his amendment. Again, I also thank him for the extensive discussions we have had in this respect.

The amendments seek to remove the ability to make provision in sanctions regulations creating offences for breaches of sanctions. I say from the outset that I sympathise with the concerns that noble Lords have expressed during various parts of the debate, not just today but in previous stages. I am sure noble Lords will also acknowledge that we have done a lot of work to try to respond to these concerns. I have tabled some government amendments in this area, which the noble Lord, Lord Collins, acknowledged.

The powers in question enable offences to be created for breaches of sanctions, in line with our current practice when implementing EU legal acts. They also enable other enforcement tools to be used, such as deferred prosecution agreements or serious crime prevention orders. Having the power to punish individuals and entities for breaching sanctions deters non-compliance and ensures the measures are robust. Sanctions without teeth, as I am sure noble Lords acknowledge, are essentially meaningless. Indeed, we debated earlier an amendment that would have included preventing,

“the violation of sanctions regulations”,

as one of the explicit purposes to be set out in Clause 1. Although I argued against that amendment on technical grounds, I agree with the spirit.

EU sanctions against countries such as Russia and Syria are imposed through EU legal acts that require member states to put in place enforcement measures at a national level. In line with that requirement, the UK routinely creates criminal offences for breaches of sanctions by way of statutory instruments made under powers in the European Communities Act 1972, as well as other legislation such as the Export Control Act 2002 and the Policing and Crime Act 2017. Other EU member states implement similar enforcement measures through their national legislation.

As foreshadowed in the White Paper consultation before this Bill was introduced, the Government want to be in a position to maintain continuity in this area. Whatever one’s views on Brexit, I think there is wide support for the principle that the UK and EU should remain closely aligned on sanctions policy. If the UK’s future sanctions regime against Russia was stripped of any enforcement provisions, I am sure noble Lords would agree that this would send a very unfortunate signal to our EU partners and to other close allies. Amendments 45 and 47 would mean that breaching a sanctions regime would not be an offence. If they are passed, as existing criminal offences in EU retained law fall away when new UK regimes are introduced, we would be unable to replicate those offences in the new regimes.

We have covered some of these issues previously, and I hope that what I have said will persuade the noble and learned Lord to withdraw his amendment. As I have said, I understand the concerns that have been expressed, including today, about the scope of these powers and will set out in a moment the government amendments that I have tabled in response. But the abolition of offences from sanctions regulations clearly undermines the purpose of the Bill and would make the UK a weak link in broader international implementation of sanctions, which I am sure is not noble Lords’ intention. I know and totally accept that this House is concerned about the creation of criminal offences through secondary legislation, a point eloquently made by the noble and learned Lord, Lord Judge, the noble Lord, Lord McNally, and my noble friend Lord Deben. I can provide this House with the following reassurances.

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Moved by

[Lord Ahmad of Wimbledon]

51: Clause 18, page 16, line 2, at end insert “(reading that provision, so far as made under section 10(2)(b), as if references to the designation were references to leaving the designation in place)”

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[Baroness Northover]

I am glad that to some extent the Government have moved in this area and I hope that, in the light of the vote that we have just had, that spirit of co-operation around the House will extend to other sections of the Bill that still need addressing.

[Lord Ahmad of Wimbledon]

My Lords, I thank the noble Lord for his amendment. As he has already indicated, it would oblige the Government to conduct a re-examination of each designation on an annual basis. I agree completely on the need for sanctions designations to be based on solid evidence. The UK has pushed hard for that in the EU, and that is widely recognised—for example, in the recent report of the House of Lords EU Committee. We are committed to maintaining these high standards.

The Bill as drafted includes a robust package of procedural safeguards, which will be further reinforced by the government amendments I have tabled, including Amendment 55. The combined package will provide a high level of protection for designated persons, at least as strong as current EU standards. The Government would review all sanctions regulations annually and present the results in a written report to Parliament. Amendment 55 makes that clear on the face of the Bill; I know that noble Lords raised that point. If the report concluded that there were no longer good reasons for maintaining a UK sanctions regime, we would lift it. Any changes made to the equivalent sanctions regimes of the EU or other international partners would be examined closely as part of the annual review.

Alongside the annual review of the regulations, the Bill requires the Government to put in place a dynamic process to reassess designations upon request; the triennial review is not the only opportunity. A designated person can request a reassessment of their designation at any time, and a further reassessment when there is a significant matter that has not been previously considered by the Minister. I take the point that a designated person, once they had requested a reassessment, challenged it in court, and failed to establish any unlawfulness, would not have a further review until either there was a significant new matter or a triennial review. But what would the purpose of a further review be when the designation has been established to be lawful and nothing has changed since then? If there are new arguments to be tested, or if the passage of time has changed the situation, a further reassessment can be requested. If not, there is no need to do so.

In response to feedback from noble Lords in Committee, I am proposing to strengthen these safeguards through government amendments. The Minister would have to deal with a request for reassessment as soon as reasonably practicable, and inform the person of the decision and reasons as soon as reasonably practicable after a decision had been made. Ministers can also instigate a reassessment at any time—for example, if the person concerned has been delisted by the EU. Ministers would have every interest in initiating reassessments proactively, both in the interests of justice and to minimise the risk and cost of legal challenges. In any case, when the EU decided to revoke the designation of a person also designated in the UK, I would certainly want to reassess the corresponding UK designation.

Taken together, these provisions will ensure that UK sanctions are under constant scrutiny and the Government are obliged to respond swiftly to new information and challenges. The triennial review then provides a further backstop, ensuring that each and every designation is looked at afresh on a regular cycle. This aligns with current practice in Australia and would put us ahead of countries such as the United States and Canada, which have no such process. It does not prevent more frequent reviews, and we have mechanisms in place that oblige us to do so when appropriate. Requiring the Government to conduct these reviews every year would be extremely resource-intensive; we have had those discussions in the bilateral and constructive meetings with the noble Lord. There are finite government resources, and the noble Lord appreciated that that would take away from other important areas. However, the amendments that we have tabled ensure that the protections the noble Lord was after have been afforded. I am thankful for his co-operation in that regard.

[Lord Pannick]

My Lords, I am grateful to the Minister. I beg leave to withdraw the amendment.

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Moved by

[Lord Ahmad of Wimbledon]

55: Clause 26, leave out Clause 26 and insert the following new Clause—
“Review by appropriate Minister of regulations under section 1
(1) Subsection (2) applies where any regulations under section 1 are in force.(2) The appropriate Minister who made the regulations must in each relevant period review whether the regulations are still appropriate for the purpose stated in them under section 1(3).(3) If a purpose so stated in any regulations under section 1 is a purpose other than compliance with a UN obligation or other international obligation, any review of those regulations under this section must also include a consideration of—(a) whether carrying out that purpose would meet any one or more of the conditions in paragraphs (a) to (d) of section 1(2),(b) whether there are good reasons to pursue that purpose, and(c) whether the imposition of sanctions is a reasonable course of action for that purpose.(4) In subsection (3)(c) “sanctions” means prohibitions and requirements of the kinds which are imposed by the regulations for the purpose in question (or both for that purpose and for another purpose of the regulations).(5) An appropriate Minister who has carried out a review under this section must lay before Parliament a report containing—(a) the conclusions of the review,(b) the reasons for those conclusions, and(c) a statement of any action that that Minister has taken or proposes to take in consequence of the review.(6) Nothing in subsection (5) requires the report to contain anything the disclosure of which may, in the opinion of that Minister, damage national security or international relations.(7) For the purposes of this section each of the following is a “relevant period” in relation to regulations under section 1 —(a) the period of one year beginning with the date when the regulations are made;(b) each period of one year that begins with the date when a report under this section containing the conclusions of a review of the regulations is laid before Parliament.”

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Moved by

[Lord Ahmad of Wimbledon]

56: Clause 27, page 19, line 15, at end insert—
“( ) Regulations made under this section in relation to a request under section 19 , 21 , 23 or 25 must require—(a) the decision on any such request to be made as soon as reasonably practicable after the receipt by the appropriate Minister dealing with the request of the information needed for making the decision, and(b) the person who made the request to be informed of the decision and the reasons for it as soon as reasonably practicable after the decision is made.( ) The regulations may authorise matters to be excluded from the reasons given for the decision where the appropriate Minister who made the decision considers that those matters should be excluded—(a) in the interests of national security or international relations,(b) for reasons connected with the prevention or detection of serious crime in the United Kingdom or elsewhere, or(c) in the interests of justice(but the regulations may not authorise that Minister to provide no reasons).”

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Moved by

[Lord Ahmad of Wimbledon]

57: Clause 29, page 20, line 6, leave out “the appropriate” and insert “that”

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Moved by

[Lord Ahmad of Wimbledon]

61: Clause 30, page 21, line 24, at end insert—
“( ) Regulations made under subsection (5) in relation to a request under this section or section 31 must require—(a) the decision on any such request to be made as soon as reasonably practicable after the receipt by the appropriate Minister dealing with the request of the information needed for making the decision, and(b) the person who made the request to be informed of the decision and the reasons for it as soon as reasonably practicable after the decision is made.( ) The regulations may authorise matters to be excluded from the reasons given for the decision where the appropriate Minister who made the decision considers that those matters should be excluded—(a) in the interests of national security or international relations,(b) for reasons connected with the prevention or detection of serious crime in the United Kingdom or elsewhere, or(c) in the interests of justice(but the regulations may not authorise that Minister to provide no reasons).”

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[Lord Collins of Highbury]

My Lords, the noble Lord, Lord Faulks, said accurately that there was a balance to be struck here, and there is a debate to be had. I am not legally qualified and therefore wish to address the political and moral issues that have been raised. The noble Lord, Lord Pannick, said that this is an extremely rare situation and that we cannot pick and choose. The noble and learned Lord, Lord Brown of Eaton-under-Heywood, said in Committee:

“I see the force of the Government’s argument that the UK has no alternative under international law but to give effect to our obligations under the UN charter; indeed, Article 103 of the charter expressly dictates that these obligations prevail over any conflicting international law obligations.”——[Official Report, 29/11/17: cols. 703-4.]


The Opposition are concerned about the signal we would send if we adopted the amendment of the noble Lord, Lord Pannick. I hear his comments about the United Nations but this Parliament must uphold international law and the supremacy of the United Nations. It should not undermine that. If we adopt the amendment, we would send the signal to other countries, which may flagrantly flout decisions of the United Nations, that we insist that they should. We judge other countries by our own standards. The noble and learned Lord, Lord Mackay, is absolutely right that there should be provision for the British courts to consider a decision of the Secretary of State. However, ultimately they should support the Secretary of State and the United Nations, not say to the United Nations, “We are not going to accept that decision”. We cannot pick and choose; that is the fundamental point. Therefore, while I totally understand the power of the arguments put forward by the noble Lord, Lord Pannick, and have a lot of sympathy with them, there is one point that trumps all else—I use that word advisedly—namely, we must uphold the decisions of the United Nations.

[Lord Ahmad of Wimbledon]

My Lords, as Minister for the United Nations, among other things, I echo the sentiments of the noble Lord, Lord Collins, about our commitment to the United Nations. As a permanent member of the UN Security Council, the UK is at the heart of shaping the UN’s response to crises around the world, as we have seen. I know that all noble Lords respect that. The United Kingdom takes this role very seriously, including in our approach to sanctions in the UN Security Council. We are one of the leading voices for UN sanctions where there are good reasons for them, as recently to constrain North Korea’s nuclear programme. At the same time, we place great importance on the need for sanctions to be used responsibly, with proper respect for due process and the rule of law. It is important to remember that as a permanent member of that Security Council, the UK exercises real authority over which sanctions are and are not adopted by the UN.

I thank all noble Lords for their comments, to which I listened carefully. The noble and learned Lord, Lord Mackay, made important points. We have exercised authority by committing that we would never support in the UN Security Council a designation that we considered unlawful. Put another way, we would not support a designation unless we had reasonable grounds to suspect that the person met the relevant criteria. Not only is this the right thing to do, it also reduces the risk of the UK being obliged to implement a UN designation that might be vulnerable to challenge in court.

The Bill recognises that persons designated by the United Nations must have a right of redress, including the ability to bring a legal challenge against the Government in the UK courts. The Bill accordingly contains the ability for such a person to have access to the court, and to obtain a remedy for any unlawfulness that the court uncovers. If the court were to consider the UN designation unlawful, the court could instruct the Minister to use best endeavours to secure a delisting at the United Nations. This is a significant remedy not to be underestimated. As a permanent member of the UN Security Council, the UK is particularly well placed to make representations that a designated person should be delisted.

The Government recognise there may be rare cases in which the Minister’s best endeavours are not sufficient to secure a delisting at the UN, as we discussed with the noble Lord, Lord Pannick, between Committee and Report. The question then is whether the UK courts should have the power to quash a UN designation and thus leave the Government in breach of their obligations under the UN charter. Our view is that this cannot be right.

First, the Bill recognises that the UK is under a duty in international law to designate those persons designated by the UN, and this proposition has not been criticised. Secondly, failure to implement a UN designation would damage the UK’s reputation as a country that stands by its commitments under international law—a point well made by the noble Lord, Lord Collins. Thirdly, it would restrict the ability of the UK to call out other states where they were falling short of their obligations under international law. If it was open to the UK not to implement our legal obligations, irrespective of whether it were following a court decision, it would be impossible to criticise other states where they were not implementing their obligations.

I take the point the noble Lord made that the EU court has very rarely quashed EU legal acts which implement a UN designation on procedural grounds. However, it has never done so where that would leave the EU member state itself in breach of its UN obligations. We should bear in mind that the EU itself is not bound by the charter, but EU states are. The noble Lord mentioned the case of Kadi, which has frequently been cited. In that case the UN had, in fact, delisted the person concerned by the time of the judgment, so EU member states themselves were spared the choice between respecting a decision of the EU courts and abiding by their UN obligations. Had they been forced to choose, I am confident that they would have prioritised their UN obligations as required—as a number of noble Lords mentioned—by Article 103 of the UN charter, which makes it clear that where there is a conflict between obligations under the UN charter and obligations under any other international agreement, the obligations in the UN charter shall prevail. The United Kingdom and all other EU member states are bound by that charter, even if the EU itself is not. That too is part of the rule of law—upholding those international laws where they bind the United Kingdom.

The United Nations has many flaws, but it is crucial to maintaining international peace and security. To allow the UK courts to stop the Government implementing sanctions agreed by the UN Security Council is not the right approach for a country such as ours that seeks to lead by example at the United Nations. I sincerely believe that any Minister, regardless of political persuasion, would share this view. I also believe we are in agreement that by continuing to make the UK’s support for UN designations conditional on fair procedural standards, we can and should do all we can to prevent this problem arising. However, in the unfortunate event that such a case arises, I remain of the view that a “best endeavours” obligation is the right way to square this difficult circle.

I deeply respect the noble Lord’s position. Again, we have had constructive discussions on this, although on this occasion we did not reach agreement. However, I hope that with the reassurances I have given, the noble Lord will be minded to withdraw his amendment.

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[Lord Ahmad of Wimbledon]

My Lords, I thank all noble Lords who have participated in this short debate, and in doing so I thank once again the noble Baroness, Lady Northover, and the noble Lord, Lord Collins, for their constructive engagement on this important issue. I agree with the point just made by the noble Lord, Lord Collins, on the importance of balance, but as noble Lords will acknowledge, the Government already publish guidance on the definition of “owned and controlled” and they will continue to do so. That duty is enshrined in Clause 36. We feel that there is no need to make it explicit, as Amendment 63 would require, and that doing so would prompt unhelpful questions about why other aspects of the guidance are not referred to in the Bill. We do not wish to limit the ability of Clause 36 to provide guidance in any of these areas.

I turn now to Amendment 64. It would greatly broaden the scope of guidance to areas such as establishing effective banking and payment corridors, which are clearly beyond the remit of the Government to provide. For example, we cannot require banks to make payments on behalf of particular customers or to open new payment channels. The whole issue of how banks operate and the derisking that we have seen in certain parts of the world is reflective of that. A requirement to provide such detailed guidance would therefore be highly problematic.

However, I do take on board some of the points raised by noble Lords about assuring that we will publish guidance at the earliest opportunity, and I hope that I can offer some degree of further reassurance. While we cannot force banks to make commercial decisions one way or the other, we can certainly encourage them to do so. We can do that through clearly drafted humanitarian exemptions, general licences, guidance and the ability to prioritise flexibly appropriate applications. I assure noble Lords that all of these can be delivered under the Bill as drafted.

If I heard the noble Baroness, Lady Northover, and indeed my noble friend Lord Dundee correctly—I thank my noble friend for his support for the Government’s actions in this regard—they referred to how the Government “may” issue guidance. I can assure noble Lords that Clause 36 makes it clear that the Minister “must issue guidance”. As I said earlier, in the near future we will publish an initial framework for the exceptions and licences.

Perhaps I may make a final point on the issue of NGOs and the humanitarian aspects. I for one have found our dialogue to be extremely constructive on a cross-party basis with NGOs. In that spirit, I certainly look forward to working with both the noble Baroness and the noble Lord to take this matter further. With those assurances, I hope that the noble Baroness will be minded to withdraw her amendment.

[Baroness Northover]

I thank the noble Lord and others who have taken part in this debate. Yes, he is right: the Bill states that the Minister “must issue guidance”, but the problem is that underneath that phrase it states that the guidance “may” include this, that and the other; in other words, it is not sufficiently specific. However, I thank the noble Lord for his response and his promises; I am sure that both the NGOs and the banking sector will see them. I hope that will move things forward and that the specific guidance enabling the banks to become involved—of course, the Government cannot instruct them to do so—is issued. If the Government are clear about what they are expecting, that is what the banking sector needs, while the NGOs need that clarity so they can get on with their work. I am sure this issue will be discussed further in the Commons, but in the meantime, I beg leave to withdraw the amendment.

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Moved by

[Lord Ahmad of Wimbledon]

65: Clause 38, page 27, line 1, leave out subsections (2) and (3) and insert—
“(2) The condition referred to in subsection (1)(b) is that the appropriate Minister making the new regulations—(a) considers that the regulations being amended will, as amended, be sanctions regulations within the meaning given by section 1(4) that are appropriate for the purpose stated in them under section 1(3), and(b) if any purpose stated in the regulations being amended is a purpose other than compliance with a UN obligation or other international obligation, considers in respect of each such purpose—(i) that carrying out that purpose would meet one or more of the conditions in paragraphs (a) to (d) of section 1(2),(ii) that there are good reasons to pursue that purpose, and(iii) that the imposition of sanctions is a reasonable course of action for that purpose.(2A) In subsection (2)(b)(iii) “sanctions” means prohibitions and requirements of the kinds imposed by the amended regulations for the purpose in question (or both for that purpose and for another purpose of those regulations).In this subsection “the amended regulations” means the regulations being amended as those regulations will be when amended.”

[Lord Ahmad of Wimbledon]

My Lords, government Amendments 65 and 68 build on the new requirements for making sanctions regulations that we have already debated. They extend these requirements to situations where a Minister is amending sanctions regulations that are not based on a UN or international obligation. In this regard, I am grateful to the noble and learned Lord, Lord Judge, and the noble Lord, Lord Pannick, for co-signing these government amendments. When amending regulations, the Minister would have to ensure that they continue to meet the relevant purposes, that there are good reasons to pursue those purposes, and that sanctions are a reasonable course of action. The Minister must also lay a written memorandum explaining why these tests have been met.

Government Amendments 67 and 102 are technical in nature—I use that word again—and enable us to implement the obligations more efficiently. I can assure the noble Baroness, Lady Northover, that they reflect the fact that UN sanctions regimes are often based on a series of Security Council resolutions. I hope noble Lords agree that these amendments are uncontentious and feel able to support them. I beg to move.

[Baroness Northover]

We welcome the Government’s move.

--- Later in debate ---

Moved by

[Lord Ahmad of Wimbledon]

66: Clause 38, page 27, line 7, leave out “The purpose stated” and insert “Except as permitted by subsection (4A), the purpose stated under section 1(3)”

--- Later in debate ---

Moved by

[Lord Ahmad of Wimbledon]

69: Clause 39, page 27, leave out line 16 and insert—
“(a) which are not for the time being authorised by Chapter 1 (ignoring section 7), but(b) which are kinds of prohibition or requirement that the United Kingdom—(i) has any UN obligation or other international obligation to impose, or(ii) has at any time had any UN obligation or other international obligation to impose.”

[Lord Ahmad of Wimbledon]

My Lords, Clause 39, to which this group of amendments refers, has been included to allow the UK to impose new types of sanction measures in response to new, unforeseen circumstances. Let me summarise why we think it is needed and then explain the government amendments that I have tabled. I note that this was one of the issues highlighted in the report of the Delegated Powers and Regulatory Reform Committee, and I know that several noble Lords have received and considered carefully my letter of last week specifically responding to the committee’s recommendations.

The familiar types of sanctions include asset freezes, travel bans, arms embargoes and prohibitions on aviation and maritime transport. These types of sanctions are included in the Bill. It is not possible to predict all the types of sanctions which may in the future be useful or necessary. We all know that as technology advances and those who wish to do us harm find ever more sophisticated ways of doing so, we may need to be able to react in an agile manner. The Government intend to continue to play a leading role in the development of sanctions as a foreign policy tool. Wherever possible we will do this through the UN to ensure that the measures have global impact. On occasion, however, we will need to work with like-minded partners outside the UN framework and may need to adapt our own sanctions toolkit to keep pace with allies. On both Iran and Russia, for example, transatlantic co-operation resulted in sanctions that were substantively different from anything previously agreed.

The power in Clause 39 is designed to provide the necessary flexibility in cases where we are acting outside the UN framework. Regulations under this clause would be subject to the draft affirmative procedure as befitting a Henry VIII power of this kind. However, having listened to the concerns expressed in this House and having reflected carefully on them, I have tabled government Amendment 69, which would further restrict the use of this power by stipulating that it may be used to create new types of sanctions only where the UK is or has been subject to an international obligation to put in place sanctions of that type. This means that the new types of sanctions created by this power can only be those developed by the international community. This power, as amended, will no longer enable the UK unilaterally to put new types of sanctions in place, which was a concern that was expressed.

Government Amendment 70 also makes it clear, as requested in Committee, that Clause 39 cannot be used to alter the purposes of the sanctions regulations specified in Clauses 1 and 2. We think that this was the effect of the original drafting, but we are happy to make it explicitly clear in the Bill. I believe that this is a substantial move forward on the Government’s part, and I hope noble Lords will acknowledge this and support it. I beg to move.

[Lord Pannick]

Again, I am very grateful to the Minister and the Bill team. Government Amendments 69 and 70 respond positively to the concerns that I and others expressed in Committee. Therefore, I will not move Amendment 71.

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Moved by

[Lord Ahmad of Wimbledon]

70: Clause 39, page 27, leave out lines 22 and 23 and insert—
“( ) For the avoidance of doubt, regulations under this section may not add to or amend the purposes mentioned in section 1(1) or amend section 1(2).”

Georgia

Lord Ahmad of Wimbledon Excerpts

Wednesday 10th January 2018 Lords Chamber

[Lord Harries of Pentregarth]

To ask Her Majesty’s Government what action they are taking with the international community to ensure that Russia respects the territorial integrity of Georgia and withdraws its troops from Georgian soil.

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, my right honourable friend the Foreign Secretary discussed Georgia with Foreign Minister Lavrov in Moscow. The UK is a staunch supporter of Georgia’s territorial integrity and sovereignty. Last year we supported two UN resolutions on Georgia’s breakaway territories of Abkhazia and South Ossetia using OSCE statements to call out Russian activities; we have funded secondees to the EU monitoring mission and contributed to NATO and other international efforts to build Georgian resilience to Russian pressure.

[Lord Harries of Pentregarth (CB)]

I thank the Minister for his Answer. It is coming up to 10 years since the Russia-Georgian war, and after all that time Russia is still in control of Abkhazia and South Ossetia while its troops are camped only 20 miles from the capital city, Tbilisi. Furthermore, it was reported last year that Russia has been moving its control points forward by several hundred yards, to the dismay of local farmers. Does the Minister not agree that this position is totally unacceptable and that it would be fatal for the international community to acquiesce to it in any way? We need new initiatives to get Russia to respect Georgian integrity.

[Lord Ahmad of Wimbledon]

The noble and right reverend Lord is of course right to point out the recent attempts by Russia to further strengthen its intervention in the breakaway regions. I assure all noble Lords that the Government continue to use all their international influence. Most notably, my right honourable friend the Prime Minister met with the Georgian Prime Minister in the margins of a recent meeting in Brussels, where the integrity of Georgia, concerning specifically the two regions the noble and right reverend Lord mentioned, were discussed and prioritised. We continue to support that. We of course continue to support the efforts currently under way in Geneva in this respect.

[Lord Collins of Highbury (Lab)]

My Lords, obviously next week the NATO military committee will meet to discuss defence resilience in Georgia. Also, just before Christmas the EU high representative made a statement on the situation, particularly on the peacebuilding efforts of the EU. Will the Minister tell us how much the Government are involved in those peacebuilding efforts to ensure we have a solution that does not involve more war?

[Lord Ahmad of Wimbledon]

The noble Lord may well be aware—I have already alluded to it—of a recent bilateral meeting between our Prime Minister and the Georgian Prime Minister. We continue to support Georgian efforts within Georgia itself on the specific issues he raised on enhancing and securing the democracy that is currently in play. We want to further ensure its sustainability. Indeed, we are providing additional funding in the region of £5.5 million to support it. We stand behind Georgian integrity. We make that point to the Georgians bilaterally and we have made it clear in our interactions with the Russians. We continue to do it through all international engagement, including in the EU.

[Lord Wallace of Saltaire (LD)]

My Lords, does the Minister recall how much British policy towards Georgia in the 26 years since it became independent has been closely co-ordinated with other EU member states? I recall, on one visit to Tbilisi, being invited by the British ambassador to sit in on one of these meetings in which EU ambassadors were drafting a joint report. I know that they had joint meetings with local Russian representatives, with the OSCE and with the Georgian Government. When will the Government explain to Parliament how they will organise continuing co-ordination with our European partners, with whom we share very common interests in this area, after we leave the European Union?

[Lord Ahmad of Wimbledon]

As the noble Lord will be aware from his own experience, it is not just our relationship through the EU. That will remain important once we leave the EU, but those relationships continue through other fora as well, such as membership of NATO—there are alliances there—and through the Security Council. France is a notable and permanent member and we can have candid discussions with other permanent members, such as Russia, which has a key influence in Georgia. I assure the noble Lord—indeed, the whole House—that we will continue to strengthen our international relationships, not just in Georgia. Where we need to work constructively, progressively and proactively with European partners we will continue to do so.

[Lord West of Spithead (Lab)]

My Lords, does the Minister not agree that we need to tread with great care here? One of the reasons for the tension and difficulty is the very loose talk there was some years ago about Georgia becoming part of NATO and the threat that that was to Russia as it stood at the time. We need to be extremely careful not to make this a real cause célèbre. We need to try to defuse some of these areas because the tension between Putin and ourselves is too great anyway.

[Lord Ahmad of Wimbledon]

The noble Lord raises an important issue. It is why we have been working on not just restating the importance of the territorial sovereignty of Georgia, but building sustainable democracy in Georgia. The noble Lord is also quite right to point out the importance of the Russian relationship. Therefore I was delighted, as I am sure all noble Lords acknowledged, that for the first time in almost six years we had a Foreign Secretary visit Russia. He had a very constructive and open dialogue with the Russians on a variety of issues, including the current situation in Georgia.

[Lord Elystan-Morgan (CB)]

Could the Minister identify those sovereign states that specifically guaranteed the integrity of this country upon it achieving statehood? Is that not an agreement binding in public international law still?

[Lord Ahmad of Wimbledon]

All noble Lords will be aware that, with the exception of Russia, as I mentioned, there are only, as I understand it, three countries—Nicaragua and Venezuela are two—which have actually recognised the two breakaway republics. To answer the question in reverse, all countries with the exception of those four recognise internationally the territorial sovereignty, including that of Georgia, over the two breakaway regions.

[Lord Pearson of Rannoch (UKIP)]

My Lords, do the Government agree that your Lordships’ collective wisdom would be of value to them in the controversial area of our relations with Russia generally? If so, will they consider arranging a full debate here before too long?

[Lord Ahmad of Wimbledon]

The collective wisdom of your Lordships’ House is of great value to the Government in all instances. As for a debate on Russia, I am sure that the appropriate usual channels will accommodate that request.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Ahmad of Wimbledon Excerpts

Wednesday 10th January 2018 Lords Chamber

Moved by

[Lord Ahmad of Wimbledon]

That the amendments for the Report stage be marshalled and considered in the following order:

Clauses 1 to 4, Schedule 1, Clauses 5 to 41, Schedule 2, Clauses 42 to 47, Schedule 3, Clauses 48 to 53, Title.

Motion agreed.

Syria

Lord Ahmad of Wimbledon Excerpts

Wednesday 20th December 2017 Lords Chamber

[Baroness Cox]

To ask Her Majesty’s Government what is their assessment of the current situation in Syria.

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, we welcome the progress made in the fight against Daesh, including the liberation of Raqqa. However, the Syrian crisis is far from resolved. Violence continues and the humanitarian situation is dire. Eastern Ghouta, which is besieged by the regime, is a particularly tragic example. A political transition is the only way to bring sustainable peace to Syria, and we support the Geneva process. All parties must work constructively towards a political agreement.

[Baroness Cox (CB)]

My Lords, I thank the Minister for his reply. Is he aware that, during a recent visit to Syria, I and colleagues met faith leaders, medical professionals, intelligentsia and parliamentarians, including the political opposition? All expressed deep anger at the UK Government’s massive funding, of at least £200 million, of bodies allied to jihadists. A recent BBC “Panorama” programme showed UK taxpayers’ money given to police assisting atrocities such as stoning victims. Can the Minister say when the UK will stop funding Islamists? As the end of the war against ISIS and other Islamist militias approaches, will the UK Government help all the people of Syria with urgently needed funding for reconstruction to enable people to return to their homes?

[Lord Ahmad of Wimbledon]

My Lords, on the second question raised by the noble Baroness, the Government’s position has been clear: we will aid the reconstruction of Syria once a peace process has been resolved and the prevailing conditions are such that there is stability in Syria. On the noble Baroness’s first question, she referred to the “Panorama” report and the £200 million. That relates to the CSSF, which the Foreign Office administers. As she will know, there are various parts of that funding; the component part that was reported on in the “Panorama” programme related to funding of the police force. The source of that funding, including who we fund through, has been put on hold pending full investigation. I am sure, however, that she would also acknowledge that £45 million of that particular funding pot supports the initiatives—and indeed the incredible courage—of organisations such as the White Helmets.

[Lord Collins of Highbury (Lab)]

My Lords, sadly, it looks like the Geneva talks will collapse, mainly because Assad’s brutal regime refuses to talk to anyone who opposes his view. I appreciate the Government’s commitment to the process but, in the light of this, what is their plan B if Assad refuses to participate at all in the Geneva talks?

[Lord Ahmad of Wimbledon]

The noble Lord raises an important point about the current regime. As he, and indeed many noble Lords, will know, while the regime is being represented at the Geneva talks, which the Government and other international partners support, it is not engaging directly in the substantive discussions with the Syrian opposition that are taking place in Geneva. We remain absolutely focused on making those talks work. In our bilateral discussions with other key players, such as Iran and Russia, who have greater influence over the Syrian regime, we are imploring them to ensure that the Geneva talks get the kick-start that they desperately require.

[Lord Hylton (CB)]

My Lords, are there not constructive steps that Her Majesty’s Government could take now: first, to have some level of diplomatic representation in Damascus, since we have full representation in such places as Russia, Iran and even North Korea; and, secondly, to start to eliminate sanctions, beginning with those on education, culture and sport? All the non-government Syrians whom we met on our recent visit assured us that the sanctions do more harm to the Syrian people and affect very little the Syrian regime.

[Lord Ahmad of Wimbledon]

First of all, the Government have no plans to reopen an embassy in Damascus until such time as we see a meaningful transition away from the Assad regime—that position has been made clear—and the position is in the hands of the civilian population and the communities themselves. In terms of the sanctions, I do not agree with the noble Lord. As I am sure he is aware, the sanctions that have been imposed include travel bans and asset freezes against 300 persons and other entities that are linked directly to the Assad regime, and they remain in place.

[The Earl of Oxford and Asquith (LD)]

My Lords, barring the unforeseeable, President Assad will remain in place until 2021, or until the Syrian people elect a successor. Three years is a long time, and mention has twice been made of sanctions on Syria. I do not think anyone expects sanctions to be lifted on the Syrian military, for example, but the country is, as the Minister recognised, suffering severely from food, clothing and especially medical shortages. As the formal position is that humanitarian aid is not embargoed, but in practice the controls on the mechanisms for financial transfers are considerable, and the acquisition of medical aid is severely sanctioned, does the Minister see scope for a review of humanitarian aid in Syria based on a more calibrated policy of exemptions or licences for the purchasers and purveyors of humanitarian aid?

[Lord Ahmad of Wimbledon]

I assure the noble Earl that, as others in your Lordships’ House know, the Government have taken a very firm line on ensuring, and, indeed, leading the way on ensuring, that in particular the NGOs working in the context of the Syrian conflict and in Syria get the necessary exemptions to allow them to deliver humanitarian aid. He will also be aware of the UK’s contribution: we are second to only one other in our contribution of close to £2.5 billion-worth of aid, assistance and humanitarian assistance. He may also be aware that we were very pleased to note the renewal of UN Resolution 2165, on the cross-border provision of humanitarian aid directly to Syria without the approval of the regime. That underlines the humanitarian commitment and support that the UK Government are delivering to the war-afflicted people of Syria through DfID and other NGOs working with great courage on the ground.

[Lord Anderson of Swansea (Lab)]

My Lords, is it not clear—

--- Later in debate ---

[Lord Ahmad of Wimbledon]

I assure the right reverend Prelate that the Government are very cognisant of the situation he has illustrated. We remain absolutely determined to ensure that all the delivery mechanisms for any funding that is provided, through the Foreign Office funding pot or DfID agencies, are robustly challenged and checked. In the case illustrated by the noble Baroness, Lady Cox, we will cease funding until we are satisfied that those in receipt of the funds fulfil the mandate of ensuring that they bring peace to the civilians of Syria and ensure equity and justice for all communities across Syria.

Commonwealth Summit 2018

Lord Ahmad of Wimbledon Excerpts

Wednesday 13th December 2017 Lords Chamber

[Lord Chidgey]

To ask Her Majesty’s Government whether, in the interests of broadening Commonwealth influence, they propose to provide observer or similar status to non-Commonwealth member countries to attend the 2018 Commonwealth Summit in London.

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, only sovereign states can become members of the Commonwealth and attend Heads of Government Meetings. Establishing a form of observer or associate status is not within the gift of the UK Government alone; it would need to be agreed by all 52 Commonwealth members. We therefore cannot provide observer or associate status to non-Commonwealth countries to attend the summit.

[Lord Chidgey (LD)]

I thank the Minister for that interesting reply. The 14 British Overseas Territories, the Crown dependencies, Scotland, Northern Ireland and Wales are all members of the Commonwealth Parliamentary Association, supporting good governance, democracy and the rule of law. First, the CPA is of course an international organisation, so why do none of those countries appear to be represented at the forthcoming parliamentary forum and the London Commonwealth summit? Secondly, noble Lords will know how frequently politicians around the world, with or without historic links to the UK, express interest in membership of the Commonwealth. While that is not in the UK’s gift, as the Minister quite rightly says, what action are the Government taking to identify and develop those interests in Commonwealth membership to our mutual and long-term benefit?

[Lord Ahmad of Wimbledon]

If I may take the noble Lord’s questions in reverse, I agree with him on his second question. We need to identify new members; he will be aware that the Gambia has applied and is currently going through the process of rejoining the Commonwealth. We hope that will happen in the early part of the new year, in time for the summit. Representation of the overseas territories and the devolved Administrations very much forms part of the UK Government’s thinking. We are their voice and we are engaging directly with the devolved Administrations; further to that, as the Minister responsible for the Commonwealth, I will visit the different parts of the United Kingdom in this respect. We are also talking directly to the overseas territories to see how we can engage more effectively with them, and perhaps involve them in some of the other events around the Commonwealth summit, such as the four fora which will take place during Commonwealth week.

[Lord Howell of Guildford (Con)]

My Lords, I wonder whether this is quite the right approach. The Minister will appreciate that at least six countries are interested in having associate status with the Commonwealth. He is absolutely right that it is not in Britain’s gift alone to deliver that but, on the other hand, we are the host of a vast summit. The Question rightly asks whether we could invite countries as observers. Is it not in our interest to develop the point that the Commonwealth is a vast transmission engine of potential soft power by this country? Should we not invite as many guests as possible to observe and be involved in some aspects, if not with full membership, of the Commonwealth summit?

[Lord Ahmad of Wimbledon]

I agree with my noble friend’s sentiments. On soft power, I am sure he saw a survey last week showing that Britain retains its top position on the global stage in soft power. On the Commonwealth specifically, I am talking to the Secretary-General, the Commonwealth Secretariat and other member states to pick up some of the very points that my noble friend raised. We will see how we can engage more effectively with countries which are indicating their desire to join the Commonwealth family at some future time.

[Lord Collins of Highbury (Lab)]

My Lords, the Minister mentioned the civil society fora. I welcome the Government’s initiative on this and their thematic approach. One thing that concerns me is ensuring that we get full attendance of civil society players. Many of them, particularly LGBT communities, live and work in very hostile environments. What steps are the Government taking to ensure that the civil society fora are attended by everybody possible and that hostile Governments do not put a stop on them attending?

[Lord Ahmad of Wimbledon]

The noble Lord raises an important issue. He will know that my right honourable friend the Prime Minister and I have had conversations about the importance of ensuring the representation of civil society groups, including those from across the Commonwealth which very vocally, and often with great courage in dire domestic circumstances, represent important issues of LGBT rights. We are clear, and I am sure the sentiment is shared by all noble Lords, that LGBT rights are human rights and that those voices need to be heard. We are working with the Commonwealth Secretariat to ensure that right is preserved and discussed at the Commonwealth summit.

[Baroness Hayman (CB)]

My Lords, the Minister kindly met me and representatives of Malaria No More to discuss the proposal for a global malaria summit during CHOGM next year. Given his earlier comments about involving people in the fora, does he agree that such a global summit would be an excellent opportunity to engage with other countries and to show Commonwealth leadership on an issue of world- wide concern?

--- Later in debate ---

[Lord Ahmad of Wimbledon]

The noble Baroness will know that I totally agree with her sentiments. Indeed, we have had a very constructive meeting with Malaria No More. We are working through the practicalities and ensuring that our intent, which is to focus on key issues such as fighting malaria, is reflected in the wider Commonwealth. The noble Baroness will understand that I cannot give a firm commitment that it has been agreed because we are waiting for responses from all 52 member states to the secretariat on the final agenda for the summit.

[Baroness Northover (LD)]

My Lords, is the Minister aware of the concern in a number of Commonwealth countries about their position in terms of trade should the UK leave the EU? He will know the economic impact on almost all Commonwealth countries of tariffs both into the UK potentially and onwards into the EU. Can he reassure them at CHOGM?

[Lord Ahmad of Wimbledon]

First, I hope the noble Baroness has been reassured by the efforts of my right honourable friend the Prime Minister in getting that first deal with our colleagues in the European Union.

[Noble Lords]

Oh!

[Lord Ahmad of Wimbledon]

I hope that was a real roar of appreciation from the Lib Dem Benches. Let us be clear that the Commonwealth is an important issue. Our partners across the Commonwealth are also very clear about Britain’s important position within the family of the Commonwealth. Yes, we will be leaving the European Union, but we will retain a relationship with it, albeit a new one. In terms of our relationship with the wider Commonwealth, I have had the good fortune in my role as Minister for the Commonwealth to travel quite widely, from the Caribbean through Asia to Australasia. All countries are very keen to work bilaterally and collectively through the Commonwealth. There is a huge opportunity, and we all look forward to next April, when we can welcome a real revitalisation of the Commonwealth family.

[Lord McConnell of Glenscorrodale (Lab)]

My Lords, will the Government ensure that there is a full discussion at CHOGM about the delivery of the sustainable development goals and will they perhaps take the opportunity, in advance of CHOGM, to publish a full and complete UK strategy for delivery of the goals by 2030?

[Lord Ahmad of Wimbledon]

I am sure the noble Lord is aware that sustainability is one of the key pillars that the Commonwealth will be discussing in that respect.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Ahmad of Wimbledon Excerpts

Committee: 4th sitting (Hansard): House of Lords
Tuesday 12th December 2017 Lords Chamber

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I thank the noble Lord, Lord Collins, and other noble Lords who spoke in this brief debate. In addition—to depart from my notes—for the first time I welcome the new Deputy Chairman of Committees to his position. It is certainly the first time for me stand at the Dispatch Box with him in his place.

From the outset I agree—I made this point clear in various debates at both Second Reading and in Committee—on the need for proper parliamentary oversight of sanctions regimes and I recognise the importance that noble Lords attach to this. That has been made very clear to me during Committee. Amendments 73 and 74 would require the draft affirmative procedure to be used for any non-UN sanctions regimes. As noble Lords know, the UK, through the European Union, imposes a number of sanctions regimes and measures that do not derive from the United Nations. These include, for example, sanctions against Russia over its illegal annexation of Crimea, and sanctions against the Assad regime in Syria.

In the future, it is likely—indeed, highly probable—that the UK would want to join its allies in imposing sanctions in circumstances where UN agreement is not possible. The noble Baroness, Lady Northover, talked about Ministers deciding. No, it would be Parliament deciding, requiring that these sanctions regimes come into effect only after the approval of both Houses of Parliament. In that way it would significantly undermine their effectiveness and make it harder for the UK to impose sanctions at the same time as international partners. Future targets of sanctions would be given forewarning of their designation, which would enable them to move their assets out of the UK and take other steps to nullify the effect of sanctions. This would undermine the credibility of sanctions as a foreign policy tool.

The Bill provides instead that the made-affirmative procedure, as the noble Lord, Lord Collins, acknowledged, should be used for non-UN sanctions to ensure that measures have immediate effect, while still requiring the approval of both Houses within 28 days. This strikes the right balance between enabling the Government to act decisively and ensuring accountability to Parliament.

Amendment 75 would require the draft affirmative procedure for any regulations that suspend, revoke or amend existing sanctions. As the Bill stands, regulations that suspend sanctions are subject to the negative procedure. This is to ensure that they can be used flexibly to recognise an improvement in behaviour while maintaining a credible threat that sanctions would immediately be re-imposed in the event of backsliding. This approach has been used to good effect as part of international diplomacy—for example, in the context of the Iran nuclear deal. If the Government were unable to suspend sanctions without waiting for the express approval of Parliament, it would reduce our ability to swiftly deploy these options in support of foreign policy goals.

In addition, as suspension of sanctions has the effect of reducing restrictions on individuals, we do not consider that it requires the higher level of scrutiny required to introduce such restrictions by imposing non-UN sanctions.

As regards regulations to revoke or amend sanctions, the Bill provides that this may be done using the same procedure as was used to create the regulations in the first place. Regimes containing UN-mandated sanctions would be revoked or amended by the negative procedure, and UK-autonomous sanctions by the made-affirmative procedure. I do not see a reason why the revocation or amendment of sanctions regimes should require greater scrutiny than their creation.

Amendment 75A intends to require the draft affirmative procedure for all sanctions regulations that contain enforcement provisions as set out in Clause 16. I acknowledge that we debated Clause 16 on the first day in Committee. I listened carefully to the concerns expressed about the creation of criminal offences through secondary legislation. We are looking at and reflecting on these concerns.

Let me may say a word or two about the process we currently follow as an EU member state and what we envisage following the enactment of the Bill. For each of the current UN and EU sanctions regimes we currently implement through EU law, the UK has created the relevant criminal penalties through statutory instruments made under the negative procedure. Similarly, we expect that all the sanctions regulations created under this Bill will include enforcement provisions of some kind. We envisage one regulation for each country, setting out the purpose of the sanctions, the specific measures being imposed, and the corresponding prohibitions and offences.

This approach allows a degree of nuance when determining penalties. For example, a breach of sanctions that results in nuclear material being made available to North Korea is obviously very serious, whereas failing to supply information to the relevant authority might attract a less severe penalty. Each regime is different, meaning different offences and penalties might be appropriate. This principle was accepted by the Delegated Powers and Regulatory Reform Committee.

Given that all sanctions regulations will include enforcement provisions, this amendment would require the use of the draft affirmative procedure in all cases, both UN and non-UN. For the reasons I have set out, we believe the correct approach is negative procedures for regulations containing UN sanctions and made-affirmative for UK-autonomous sanctions.

The use of the draft affirmative procedure for UN sanctions regulations would mean that we would routinely breach our obligation to implement the relevant asset freezes “without delay”. Noble Lords may be aware that Part 8 of the Policing and Crime Act 2017—approved by this House—contains specific powers designed to bridge the sometimes lengthy gap between the adoption of measures by the UN Security Council and the entry into force of the corresponding EU legal Acts. The amendment would undo our recent efforts to accelerate our domestic implementation of UN sanctions. Given my explanation to the Committee, I hope that the noble Lord, Lord Collins, is minded to withdraw his amendment.

[Lord Collins of Highbury]

I thank the Minister for his response. The words of the noble and learned Lord, Lord Judge, come to mind: he said that we are not simply bringing EU law into domestic law and preserving it, but extending it—a lot. That is the key issue of concern to noble Lords in this House. I hear what the Minister is saying but we will keep coming back to this issue in other groupings. On Report, we will certainly make the voices of all noble Lords heard on this subject. I beg leave to withdraw the amendment.

--- Later in debate ---

[Lord Ahmad of Wimbledon]

My Lords, I am very grateful to the noble Lord, Lord Collins, for again raising the issue of parliamentary oversight, and to all noble Lords who have spoken in this debate. I start with a confession: unlike the noble Baroness, Lady Bowles, I did not go to bed last night thinking about the Sanctions and Anti-Money Laundering Bill. I had a three year-old to contend with at that time, so I did not share that experience, nor did I dream about the Bill. Nevertheless, let me say at the outset that I accept the importance of scrutiny, as I have said, and before I come to the amendments in the name of the noble Lord, Lord Collins, I shall address the point just made by the noble Lord, Lord McNally, who spoke about his ministerial responsibilities when he was Minister for the Crown dependencies. His advice is something that I have continued to say to our overseas territories. I was his Whip at that time and I recall those conversations well. Equally, although the noble Lord, Lord Hain, is not in his place, in addressing these amendments I totally acknowledge the important points made in Committee about anti-money laundering and raised again in relation to the previous groups.

I shall address Amendments 75B, 76A and 76B together, as they have a single effect of changing the procedure for regulations made under Clause 41 of the Bill, which concerns anti-money laundering, to the so-called super-affirmative procedure. As we have discussed previously, the Government are committed to ensuring robust scrutiny of regulations made under the Bill. Any regulations made under this clause already have to be made under the draft affirmative procedure and require Parliament’s consent before they take effect. The sole exception to this is when regulations are made to add or remove countries from a list of high-risk jurisdictions in connection to which enhanced due diligence measures must be undertaken. Both the Financial Action Task Force and the European Union currently publish such lists. After the United Kingdom ceases to be a member of the EU, we will seek to align our list of high-risk jurisdictions with that published by the FATF. Part 3 of the Bill provides that regulations updating this list will be made through the made affirmative procedure. This will ensure effective parliamentary scrutiny of such changes, while ensuring that we can align promptly with international standards around which jurisdictions present high risks of money laundering or terrorist financing.

However, this amendment would go further. It seeks to impose the so-called super-affirmative procedure. This would require the Government to publish a draft statutory instrument, with a detailed explanation of its contents, and have due regard to any representations made within a 40-day or 60-day period, including any resolutions of Parliament, before seeking the consent of Parliament to the original or an amended version. I totally appreciate the need for parliamentary oversight, but I believe that this amendment is unnecessary. I assure noble Lords that the Government take parliamentary scrutiny seriously, reflected in the fact that regulations under this clause are already under the draft affirmative procedure.

The Bill will already increase levels of parliamentary scrutiny above and beyond the status quo. We—and other Governments, regardless of party—typically make anti-money laundering regulations through the negative procedure. The Labour Government did this when transposing the third EU money laundering directive through the Money Laundering Regulations 2007. A similar approach was taken earlier this year when we transposed the fourth EU money laundering directive through the money laundering regulations 2017. As noble Lords will be aware, the implementation of the 2017 regulations followed a 12-week policy consultation, followed by a four-week consultation on the draft regulations. Consultations of this type are usual practice for significant changes to regulatory regimes, such as those relating to anti-money laundering.

The Government always pay close attention to the views of parliamentarians, and of noble Lords in particular, on anti-money laundering. In last week’s debate on the Bill we talked about the anti-corruption strategy, which, as the noble Lord, Lord Collins, acknowledged, we published yesterday. In it we reaffirmed our commitment to establishing a public register of the beneficial ownership of overseas companies which own UK property. The Government will publish a draft Bill to this effect in this parliamentary Session, allowing an opportunity for pre-legislative scrutiny. The noble Lord, Lord Collins, asked about the strategy. I assure him that the Home Secretary, as a senior member of the Cabinet, will personally chair a new economic crime strategic board to drive forward action in this regard.

When changing the UK’s anti-money laundering framework after leaving the EU, the laying of regulations through the draft affirmative procedure will allow Parliament and the relevant committees sufficient time to look at the draft before it is debated or comes into effect. I also remind noble Lords that the regulations will be subject to an affirmative resolution in both Houses before they come into force. These measures, along with changes to the Government’s processes for bringing forward secondary legislation, will go further to addressing the issues that the noble Lord, Lord Tunnicliffe, raised earlier this year in relation to the process by which the money laundering regulations 2017 were brought into force.

On the point of broader consultation, I reassure noble Lords that the Government regularly speak to interested stakeholders when considering changes to policy or process. I am confident that this will remain the standard practice in matters of this kind, where the Government are dependent on banks, businesses and other stakeholders to ensure effective compliance. With that explanation, I hope the noble Lord is minded to withdraw his amendment.

[Lord Collins of Highbury]

My Lords, I thank the Minister for his comments, but I think all noble Lords will be concerned. We are moving from one type of regime to another. The fact of the matter is that, as the noble Baroness, Lady Bowles, has said on numerous occasions, EU directives go through a very detailed process of democratic scrutiny—at European level and, of course, at domestic level. We know in advance what those directives contain and we debate them fully, and we have the opportunity, through our representation in Europe, to challenge elements of them. All that is going to disappear when we leave the EU. We want to know that we are not giving up that democratic accountability to simply place everything in the hands of the Executive. I am rather disappointed, to put it mildly, with the Minister’s response. I assure him that we will be tabling amendments on Report, particularly with regard to Clause 41, which will ensure that there is proper accountability and scrutiny.

[Lord Ahmad of Wimbledon]

I assure the noble Lord that I am listening very carefully. I did the noble Baroness, Lady Kramer, an injustice when flicking through my notes. As noble Lords can probably hear, my voice is deeper. That is the result of telling your children to wrap up warmly on Wimbledon Common but not following that advice yourself. Nevertheless, I listened to the points made by the noble Lord and the noble Baroness, Lady Kramer, very carefully. I will consider carefully the points the noble Baroness has raised in Committee, particularly on having a framework, and I recognise the importance of the points raised by the noble Lord—I hear his strength of feeling. I will respond to these issues, as I have said. Some of these concerns have been raised in the Delegated Powers Committee’s report, which we will respond to shortly as well.

[Lord Collins of Highbury]

I thank the Minister for those additional comments but they still do not change my concerns. I would welcome whatever further consideration he gives them and ask that we have what he has to say in plenty of time before Report. In the meantime, I beg leave to withdraw the amendment.

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[Lord Davidson of Glen Clova (Lab)]

My Lords, this amendment is a useful reminder that the Brexit process needs to reflect the devolved nature of the United Kingdom. I take this opportunity of looking at this amendment to make certain observations more broadly and, indeed, to go back to the previous group where the Minister referred to a UK property register. He will be aware—and if he is not aware, he will no doubt be told by those sitting beside him—that the United Kingdom property register covers the whole United Kingdom via three separate registers. Indeed, two of those registers come from jurisdictions which voted by a majority to remain in the EU. Plainly the Minister does not intend to give ammunition to those who wish to withdraw from the UK. This Bill, and this part, are aimed at enabling withdrawal from the EU. That is one objective. There is a body of people who will find ground for complaint in more or less anything that in some way does not take account of the separate nature of various bits of the United Kingdom. With that small warning, I commend this amendment, and leave it at that.

[Lord Ahmad of Wimbledon]

My Lords, the Bill provides powers to be used in pursuit of the UK’s foreign policy and to ensure our national security. Under the UK’s constitutional settlement, these matters are reserved to Westminster. This Bill is accordingly one that is so reserved.

The amendment would, in effect, give the devolved Administrations the right to veto legislation related to UK foreign and security policy. This is contrary to the devolution settlement between Westminster and the devolved legislatures. Devolved legislatures do not have any right to veto measures where they relate to matters of foreign and security policy, including decisions of the UN Security Council. Any such amendments can arise only as the consequence of the sanctions themselves. Their primary purposes will always be a reserved matter.

I reassure noble Lords that during the preparation of the Bill the devolved Administrations were fully consulted on this point and they have not disagreed with our assessment that the Bill is reserved. The amendment would rewrite the devolution settlement, and I am sure that was not the intention behind it.

On the observation and implementation of international obligations within the competence of the devolved Administrations, while they have the power to legislate to implement measures required as a result of international obligations entered into by the UK, that does not provide them with any right to veto UK measures for the purposes of foreign and security policy, including measures negotiated and agreed by the UK in the UN. As I have already said, we have consulted extensively with the devolved Administrations on this very point and they have not disagreed with the Government’s assessment.

[Baroness Northover]

My Lords, I thank the Minister for that response which was along the lines that I anticipated. Yet again, it is an argument for generally limiting the powers in the Bill so that the concerns that I have expressed would be lessened. I thank noble Lords for their support. In the meantime, I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Kramer]

My Lords, I will speak briefly. I am no expert on the relevant legislation that is being repealed under this clause, but I have spoken to those who are, and the response I have had is one of shock. Legislation that went through both Houses of Parliament, with great care, debate, consideration and amendment, is now being swept away, to be replaced by a regulatory power, which, again, is not bounded in any way. It could be identical or it could be completely different, but it is not discussed or laid out anywhere in this legislation.

In the past we have talked primarily of powers that have come through a democratic process in Brussels: through the European Parliament’s scrutiny, consultation and voting processes, and through votes of the Council. In this case, we are talking about sweeping away, to be replaced by regulation, significant legislation that came through this Parliament in a democratic process. I do not understand, nor have I heard any explanation, why the Government are choosing to take this route.

[Lord Ahmad of Wimbledon]

My Lords, I draw noble Lords’ attention to the White Paper that preceded the Bill, in which we noted that the terrorist threat has evolved since the enactment in 2010 of the Terrorist Asset-Freezing etc Act—TAFA—which the noble Baroness, Lady Kramer, just referred to. We need to ensure that UK counterterrorist sanctions powers remain a useful tool for law enforcement and intelligence agencies. We therefore propose to use the Bill to establish a common approach to designations under counter- terrorism and country sanctions regimes, including the asset-freezing powers set out in Clause 2.

--- Later in debate ---

[Lord McNally]

My Lords, these exchanges show some of the dilemma of dealing with this issue. I ask a fairly simple question when I look at these things. Why should a financial services organisation decide to base itself on some microdot in the Caribbean to provide its services? Once you ask that question, you begin to wonder whether it is to avoid the kind of rigour and inspection that they get in more well-established centres. As I said in my earlier intervention, I worked for three years with the Crown dependencies, ably aided by the Minister, in his then capacity as a Whip. I made two points. One, which I mentioned earlier, was my advice to them to make sure they answered the various questions put to them with full candour and transparency. I pay tribute to the Justice Committee under the chairmanship of my noble friend, who put forward a range of suggestions. Another point was that the British Government should get their act in better order. Sometimes, the job was to make sure that, when getting this dealt with, Whitehall departments were sufficiently accessible and aware of the particular status of the Crown dependencies.

During those three years of experience, I was impressed by the qualities of the Civil Service and the representatives of the Crown dependencies in dealing with these issues. That does not take away the fact that they, and we, have to face the fact that, as the noble Lord, Lord Collins, said, it is our reputation that is at stake. I had nothing to do with the overseas territories, but there is a qualitative difference which needs to be looked at between their standards of supervision of financial services and those of the Crown dependencies. I take the point made by the noble Lord, Lord Anderson, about the Isle of Man and Jersey. I hope they are both addressing what it is that has landed them on that list. That is something for their processes, because this is damaging to them, although there may be other jurisdictions within the EU which could not bear too close examination.

This is in our national interest. It is not us playing the neo-colonial or trying to order them about. We are defending our national interest when jurisdictions are seen as British Overseas Territories. When I had to learn that very peculiar lesson, the first thing I was told was that we joined them; they did not join us. The difference in constitutional relationship is because they were part of the Duchy of Normandy that conquered us. Nevertheless, the Channel Islands and the Isle of Man have to understand that their meeting the highest standards is going to be a legitimate interest of the British Parliament and British Government, in defence of Britain’s reputation.

[Lord Ahmad of Wimbledon]

I thank all noble Lords who have taken part in this important debate. As we have heard, the UK is responsible for the foreign affairs and security of both the Crown dependencies and overseas territories. That is the constitutional position. Our long-standing practice is that we do not generally legislate for these jurisdictions without their consent. This point was well made, in the context of the Crown dependencies, by the noble Lord, Lord Beith. Sanctions are tools of foreign policy, or are used to protect our national security. It is clear that the overseas territories and Crown dependencies must follow the UK Government’s foreign policy, including the sanctions we apply. I assure noble Lords that the Foreign Office has discussed this with the overseas territories and Crown dependencies and they also accept this central point of principle.

There are currently two ways in which sanctions are implemented by the overseas territories and Crown dependencies. The UK legislates directly for the majority of these jurisdictions through Orders in Council. Other jurisdictions legislate for themselves, but follow precisely the sanctions implemented in the UK. This model is well established and respects the rights of these jurisdictions.

The Bill is drafted in a way that reflects this reality. It is consistent with the current implementation model for UN and EU sanctions as well as measures under the Terrorist Asset-Freezing etc. Act 2010. It allows those jurisdictions that wish to follow UK sanctions through their own legislation to continue to do so. It also allows the UK to legislate directly for certain overseas territories as appropriate.

With regard to anti-money laundering laws, all the Crown dependencies, and each of the overseas territories with a significant financial centre, subscribe to the international standards for anti-money laundering and counterterrorist financing set by the Financial Action Task Force. They are assessed in their own right for compliance with these standards and have responsibility for implementing them within their own domestic frameworks.

The Government, of course, retain an interest in ensuring that the Crown dependencies and overseas territories have robust anti-money laundering regimes. As noble Lords are aware, and as I stated in a previous debate—this point was raised with the overseas territories at the recent joint ministerial council—we are already working very closely with those jurisdictions which do not already have national company beneficial ownership registers on establishing such registers or similarly effective mechanisms, and ensuring that information held on these can be shared in near real time with UK law enforcement authorities.

I remind noble Lords that we legislated earlier this year, through the Criminal Finances Act, to establish a statutory review of how these arrangements have been implemented. This will take place before 1 July 2019 and will inform any further debate about the effectiveness of measures relating to beneficial ownership in place in individual Crown dependencies or overseas territories. We should also recall that full implementation of these arrangements will put these jurisdictions ahead of the international standards in this area, and ahead of the approach taken by many G20 countries and individual states of the United States.

This demonstrates the benefits of the co-operative relationship that we have established with the Crown dependencies and overseas territories in combating money laundering and terrorist financing. These jurisdictions are self-governing and take their compliance with the FATF standards very seriously. The anti-money laundering regimes of each of the Crown dependencies have been evaluated since 2015, with overseas territories, including the Cayman Islands and the British Virgin Islands, both scheduled to be evaluated in the coming year. The commitment of these jurisdictions to international standards in this area is the best way to ensure that they continue to have robust anti-money laundering and counterterrorist financing regimes. As I said in the previous debate in Committee, this is a point we have once again emphasised in all our communications, and it was emphasised by my right honourable friend the Prime Minister in her recent meeting with the overseas territories. These are long-standing arrangements.

The noble Baroness and the noble Lord, Lord Collins, talked about progress and moving forward. We are moving forward positively and I have already talked about the results. In this regard, I do not believe that these amendments are needed. I am sure noble Lords would not wish to jeopardise the achievements that we have seen thus far, which have come from direct co-operation and working with these jurisdictions, and the progress that has already been made. With that, I ask the noble Lord to withdraw his amendment.

[Lord Collins of Highbury]

I thank the Minister for his response. However, I am a little disappointed. We should not apologise for taking the lead in trying to build confidence globally in financial standards. We should not be in any way apologetic about leading the way because London is a global financial centre—

[Lord Ahmad of Wimbledon]

My Lords, I do not think I apologised in any sense, and nor should we—I agree with the noble Lord. We are leading the way and we are proud of that. We have to put this into context. The noble Lord, Lord Beith, talked about the important relationship with Crown dependencies. I have talked about the relationship with our overseas territories. They legislate in many areas. The relationship does not just work; the strength of relationship allows us to make the progress we are making. Britain is leading the way and our overseas territories and Crown dependencies have shown substantial progress in this respect. Perhaps other G20 countries have a lot of catching up to do. We are leading in this respect.

--- Later in debate ---

[Lord Falconer of Thoroton]

I apologise to him. The noble Lord who is also a Minister—I of all people should know that—means well in his intentions and assurances. From experience in the Executive, we reach for the legislation and read it as it is. My anxiety is that unless we get it right in the Bill, we will give the Executive huge powers. As the noble Baroness, Lady Kramer, said, when we voted to leave the European Union, we never intended to do anything other than leave the European Union. We did not intend to change completely the balance of the constitution and give the Executive that degree of extra power. I am talking not only about this Bill, but the whole balance of the constitution. This is happening because everything is necessarily having to be done in a hurry. The oddity about this Bill is that it is an early stage Brexit consequential. It is not adequate in the balance it has struck between the Executive and the legislature. If this Bill has got it wrong, then things will get worse as the pressure builds on parliamentary draftsmen, Ministers and policymakers. We must stand firm as a House to send a message that future Bills must be more accurate than this one in terms of the balance between the Executive and the legislature.

I support the amendment of my noble and learned friend Lord Davidson and my noble friend Lord Collins because it is inconceivable to me, in the light of the number of changes that we have sought, that everything will be put right on Report. The Bill should be time-limited for five years so that the Government have to come back with a further shot at it. We will need this sort of Bill indefinitely, but the balance in this one is so badly wrong that I think a separate clause is appropriate.

[Lord Ahmad of Wimbledon]

My Lords, I thank all noble Lords—indeed, noble and learned Lords—who have taken part in the debate. I acknowledge the points that have been raised on this amendment.

Turning to Amendment 85, it will not surprise the noble Lord that we do not believe that there should be a sunset clause in the Bill. Whatever the nature of our future relationship with the EU—I am sure that the noble Lord, Lord Collins, meant when, not if, we leave the EU; he may choose to clarify otherwise—the powers in the Bill will be necessary. We will need them to comply with UN obligations and we will need autonomous powers to be able to create, amend or lift sanctions to address a wide variety of national security and foreign policy challenges. It is true that the design and scope of sanctions has changed over the years, but we need the power to implement sanctions as part of our diplomatic toolkit, which will not go away.

I also acknowledge and appreciate the point of the noble and learned Lord, Lord Falconer, that all noble Lords, irrespective of the approach and mechanisms, agree with the principle that this Bill is required. I also acknowledge, as I have done in Committee, the important role of this House in the scrutiny of legislation. In the responses I have given on which we are not agreed, I hope it is clear that there are areas that the Government will reflect on and return to. In that respect, I hope to meet with noble Lords in the intervening period before Report to see how we can bridge some of the challenges and differences that have been raised.

Further, I assure noble Lords that we are committed as a Government to getting this legislation right. The Bill is designed to ensure that we can continue to use sanctions appropriately—I know that is a principle accepted by all noble Lords—in response to future global developments and challenges, and to provide that the right safeguards are in place for the use of those powers, which I also respect. I am immensely grateful for the active contributions of noble Lords in helping us to do this.

Foreign and Commonwealth Office: Ministerial Guidance

Lord Ahmad of Wimbledon Excerpts

Monday 11th December 2017 Lords Chamber

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, all Ministers are bound by the Ministerial Code, which sets out the standards of conduct expected of Ministers in how they discharge their duties. The Foreign and Commonwealth Office does not provide any specific additional guidance. The Permanent Secretary is responsible for discussions with Ministers about what is expected under the umbrella of the Ministerial Code, and for advising them on routine day-to-day issues as they arise.

[Lord Soley (Lab)]

Is the Minister aware of the immense damage being done to Britain’s reputation abroad, and to the rights of British citizens abroad, by the tendency of the present Foreign Secretary, Boris Johnson, to speak first and think afterwards? Can he and his colleagues in government please convey to him that he needs to reverse that process, because he has a bad reputation for it both in this country and overseas, and it is damaging Britain’s relationships and damaging individuals?

[Lord Ahmad of Wimbledon]

My right honourable friend the Foreign Secretary, as I am sure that many in this House acknowledge, represents our country and the Foreign Office in exemplary fashion, and this weekend’s example is testimony to that. Over the past week, he has raised some important issues of counterterrorism and countering violent extremism. This again demonstrates the importance that he attaches to representing the Government abroad, as do I in my responsibilities as a Minister of State who serves with him on that team. I have seen him in operation directly as a Minister within his team; he operates with a strategic outlook and in a very positive fashion.

[Viscount Hailsham (Con)]

Does my noble friend agree that, however accomplished the Foreign Secretary may be, the influence of the United Kingdom will be reduced if we are generally seen as the demandeur in negotiations rather than a leading voice in a settled group?

[Lord Ahmad of Wimbledon]

My Lords, I think Britain is recognised as a country that provides balance and leadership through various international fora. Let us not forget that we are a P5 member on the UN Security Council. My noble friend will be aware that the Commonwealth summit and Commonwealth Heads of Government Meeting is around the corner in April. Again, the United Kingdom is honoured to be hosting it and working with the Commonwealth Secretariat to set the agenda for what will be a positive example of global Britain in action.

[Lord Collins of Highbury (Lab)]

My Lords, an issue of concern—to me and I think many noble Lords—has been the capacity of the Foreign and Commonwealth Office to deliver on behalf of this United Kingdom with the necessary tools to do the job; the noble Viscount referred to that. It is an important issue that the Minister needs to address. Only last week, when we were discussing President Trump’s decision on Jerusalem, the Foreign Secretary made a speech in which our concern was to be included but that section was omitted. That is not a matter of capacity; it is clearly a matter of design. Will the Minister explain why such an important position of the United Kingdom was ignored by the Foreign Secretary?

[Lord Ahmad of Wimbledon]

My Lords, I draw attention not to myself but, in looking to my right and around this Chamber, I am sure that all noble Lords would acknowledge the tremendous service to this Government that my predecessors have given as Ministers of State in the Foreign Office. My noble friends Lord Howell, Lady Warsi and Lady Anelay are examples of how the voice of the Foreign Office is heard not just in this House but across—oh! The noble Baroness, Lady Chakrabarti, is perhaps casting aspersions on my performance; that remains to be seen.

The noble Lord raises an important point about international issues. I draw his attention and that of my noble friend to the statement given by Ambassador Rycroft at the United Nations, where we stood side by side with other European nations to make clear our position on the issue of east Jerusalem. I understand that that question was raised here. We remain consistent with all Governments in saying that we need a two-state solution where the capital of Jerusalem is shared by both states. That point has been made consistently by all Governments of all sides. We should focus on challenges facing the Foreign Office such as retaining the nuclear deal with Iran. The Foreign Secretary has led the way in ensuring that balance, communication and contact is retained on an international front on that very important issue.

[Lord Wallace of Saltaire (LD)]

My Lords, the Israeli press comment on the recent visit was rather critical, and I have seen many other critical comments on the Foreign Secretary’s performance in other foreign media over the last year. Can the Minister try to redress the balance by telling us about the Foreign Secretary’s close, mutually confident relationships with any particular senior Ministers of foreign Governments?

[Lord Ahmad of Wimbledon]

If I started talking about the Foreign Secretary’s close and constructive relationships—there are many I could name—I fear it would take us beyond the 30-minute limit. We shall be coming to the subject later, but I can say briefly that the Foreign Secretary has just returned from a very important and constructive visit to Iran and the Middle East, where I am sure noble Lords will agree that we have important relationships. He is leading from the front in ensuring that those relationships are not just sustained but strengthened.

[Lord Kirkhope of Harrogate (Con)]

Does my noble friend agree, in answer to the Question of the noble Lord, Lord Soley, that diplomacy does not require guidance or any teaching at all? We have been fortunate in this country to have had many interesting individuals who have carried out the role of Foreign Secretary over centuries. Not all of them have been straitjacketed by guidance or anything coming from an official level. Surely my noble friend agrees that the only way in which we can judge the success of diplomacy is whether it serves the best interests at any time of this country.

[Lord Ahmad of Wimbledon]

I agree with my noble friend and add that in the role of Foreign Secretary, any Foreign Office Minister—or, for that matter, any Minister—personality also counts.

Visit to Oman, UAE and Iran

Lord Ahmad of Wimbledon Excerpts

Monday 11th December 2017 Lords Chamber

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, with the leave of the House, I shall now repeat a Statement made by my right honourable friend the Foreign Secretary. The Statement is as follows:

“Mr Speaker, with your permission I will make a Statement on my visit to the Middle East, from where I returned this morning.

This is a crucial time in the region. On the one hand we have a moment of hope, with scores of countries having come together to break the corrosive grip of Daesh on Iraq and Syria. Britain’s Armed Forces have played a proud role in a military campaign that has freed millions, and Iraq’s Government declared on Saturday that all of its territory had been liberated. During her successful visit to Iraq last month, my right honourable friend the Prime Minister thanked the British service men and women who have helped to bring about the territorial defeat of Daesh. In Jordan, she reaffirmed Britain’s absolute commitment to the peace and stability of one of our closest allies in the region.

But the setbacks inflicted upon Daesh have coincided with a dangerous escalation of the war in Yemen, where one of the worst humanitarian crises in the world is now unfolding. This morning, I returned from my first bilateral visit as Foreign Secretary to Oman, the UAE and Iran. My aim was to take forward Britain’s response, diplomatically and economically, to the crisis in Yemen. The Government strongly believe that the only way of bringing this tragic conflict to an end is through a political solution. His Majesty Sultan Qaboos of Oman, whom I met in Muscat last Friday, entirely shared this analysis. The Sultan and I discussed in detail the tragedy in Yemen, with which Oman shares a 180-mile border. The Sultan and I also agreed on the importance of settling the dispute between Qatar and its neighbours, and I was pleased to see that the summit of the Gulf Cooperation Council went ahead in Kuwait last week.

From Muscat I travelled to Tehran where I met Iran’s senior leadership, including President Rouhani, Vice-President Salehi and the Foreign Minister, Javad Zarif. I was frank about the subjects where our countries have differences of interest and approach, but our talks were constructive none the less. The latest chapter of Britain’s relations with Iran opened with the achievement of the nuclear deal, the JCPOA, in July 2015. In every meeting I stressed how the UK attaches the utmost importance to preserving that agreement. For the JCPOA to survive, Iran must continue to restrict its nuclear programme in accordance with the deal—the International Atomic Energy Agency has verified Iran’s compliance so far—and other parties must keep their side of the bargain by helping the Iranian people to enjoy the economic benefits of re-engagement with the world.

The House knows of Iran’s disruptive role in conflicts across the region, including in Syria and Yemen. Our discussions on these subjects were frank and constructive, though neither I nor my Iranian counterparts would claim that we reached agreement on all issues. If we are to resolve the conflict in Yemen, Houthi rebels must stop firing missiles at Saudi Arabia. The House will recall that King Khalid International Airport in Riyadh, Saudi Arabia’s equivalent of Heathrow, was the target of a ballistic missile on 4 November. I pressed my Iranian counterparts to use their influence to ensure that these indiscriminate and dangerous attacks come to an end.

On bilateral issues, my first priority was the plight of the dual nationals behind bars. I urged their release on humanitarian grounds where there is cause to do so. These are complex cases involving individuals considered by Iran to be their own citizens, and I do not wish to raise false hopes. However, my meetings in Tehran were worthwhile and, while I do not believe it would be in the interests of the individuals concerned or their loved ones to provide a running commentary, the House can be assured that the Government will leave no stone unturned in our efforts to secure their release.

I also raised with Mr Zarif the official harassment of journalists working for BBC Persian and their families inside Iran. I brought up Iran’s wider human rights record, including how the regime executes more of its own citizens per capita than almost any other country in the world. Still, where it is possible to be positive in our relations with Iran—for instance, by encouraging scientific, educational and cultural exchanges—we should be ready to do so.

I then travelled to Abu Dhabi for talks yesterday with the leaders of the UAE, focusing on the war in Yemen, joined by the Saudi Foreign Minister, Adel al-Jubeir, and colleagues from the US. We agreed on the importance of restoring full humanitarian and commercial access to the port of Hodeidah, which handles over 80% of Yemen’s food imports. We also agreed on the need to revive the political process, bearing in mind that the killing of the former President, Ali Abdullah Saleh, by the Houthis may cause the conflict to become even more fragmented. We discussed how best to address the missile threat from Yemen, welcoming the United Nations investigation into the origin of the weapons that have been launched.

Our concern for the unspeakable suffering in Yemen should not blind us to the reality that resolving a conflict of this scale and complexity will take time and persistence, and success is far from guaranteed. However, it is only by engagement with all the regional powers, including Iran, and by mobilising Britain’s unique array of friendships in the Middle East, that we stand any chance of making headway. I am determined to press ahead with the task, mindful of the human tragedy in Yemen, and I shall be meeting my regional and American colleagues again early in the new year. I commend this Statement to the House”.

--- Later in debate ---

[Baroness Northover (LD)]

My Lords, I, too, thank the Minister for repeating the Statement. I start by referring to the Foreign Secretary’s visit to Iran. I welcome the fact that the Minister’s right honourable friend made that visit, and it is surely right that we seek to improve the relationship with Iran. The nuclear deal, to which the noble Lord, Lord Collins, just referred, in which our colleague the noble Baroness, Lady Ashton, played such a key role, was a major milestone. Does the Minister agree that we undermine it at our peril? Does he hope that those around the American President will restrain him when he seeks to do so? Is this a point that his right honourable friend will make when he meets American colleagues in the new year? Does he agree that we need to work very closely with our European allies on this matter?

I am extremely glad that the Foreign Secretary raised the cases of our dual nationals in Iran. The House will know that I have raised the case of Nazanin Zaghari-Ratcliffe in your Lordships’ House on a number of occasions, and I am very glad that he urged the release of Nazanin and other dual nationals on humanitarian grounds. I am glad that he says that no stone will be left unturned; surely that is what is required. I sincerely hope that we will see Nazanin’s release imminently, along with other dual nationals, and I note the quiet dignity with which Richard Ratcliffe raises his wife’s case. Can the Minister assure us that his right honourable friend emphasised Nazanin’s dire health situation? Does he have hope that she might be reunited with her family in the UK for Christmas?

As we seek to normalise relations with Iran, what is the situation with regard to enabling the Iranian embassy here to open a bank account? What is being done to strengthen trading links?

As we all know, the Middle East is such a tinderbox, and it is therefore vital that we strengthen our relations across the region. In the light of that and of the unpredictable nature of the current American regime, might Oman or others in the region play a part in bringing peace in Yemen? Can the Minister update us on what the world can best do, given the terrible situation there? Also, what assessment have the Government made of the impact of the blockade against Qatar on the stability of the UAE?

In conclusion, will the Minister reiterate that his right honourable friend will indeed continue his focus on Nazanin Zaghari-Ratcliffe? We will all be looking for a positive resolution to her case.

[Lord Ahmad of Wimbledon]

My Lords, I thank both the noble Lord, Lord Collins, and the noble Baroness, Lady Northover, for welcoming the initiative and visit of my right honourable friend the Foreign Secretary. They rightly raised various consular cases, including the case of Nazanin Zaghari-Ratcliffe. Let me assure all noble Lords that these issues were raised with all relevant parties, including the President, the Foreign Minister and the representatives of the National Security Council. In repeating the Statement, I made a point well made by the noble Baroness when she pointed to the humanitarian grounds in the case of Nazanin Zaghari-Ratcliffe. The sentiments she expressed are ones we all share. We hope and pray for an early resolution of that case and, indeed, all consular cases. I reassure all noble Lords that we continue to raise these issues on a regular and consistent basis, as they were by my right honourable friend in a candid and constructive manner. We will of course continue to update your Lordships’ House as appropriate on progress in this regard, but I particularly thank the noble Lord and the noble Baroness for their appreciation of the sensitivity of all consular cases.

To make a general point about consular cases—I assure noble Lords that I ask for this information myself whenever I am travelling around the world—all Ministers raise issues about consular cases, the number of which may range between 2,000 and 3,000 at any given time. It is important that, wherever people are held, humanity prevails and we see their release expedited.

The noble Lord, Lord Collins, raised the issue of BBC Persian. He was quite right: as I again mentioned in repeating the Statement, there have been reports of harassment of BBC Persian staff and their families in Iran, which is very concerning. This has been raised consistently with the Iranian authorities. This is part of a key focus for my right honourable friend on the wider human rights agenda. I can confirm that he raised the particular concerns about BBC Persian with both the Iranian Foreign Minister Zarif and Vice-President Salehi during the recent visit.

Both the noble Lord and the noble Baroness raised the issue of the JCPOA. I thank them for their continued support. It is important that Britain speaks as one on this important issue. As all noble Lords will be aware, my right honourable friend the Prime Minister has reaffirmed to President Trump the UK’s strong commitment to this deal, which is vital for the UK and for regional security. My right honourable friend the Foreign Secretary repeated this to opposite numbers in Washington during his November visit.

The noble Lord also asked what other groups and countries we are working with. I assure him that we continue to enjoy close co-operation on Iran with the US but also with our E3 partners. Where we have differences, we raise them. It is right that we debate them openly, as my right honourable friend the Prime Minister has done, but I remain of the opinion expressed by both the noble Lord and the noble Baroness that retaining and sustaining that deal is extremely important not just to the region but to stability across the world.

The noble Lord also raised the issue of Syria and the importance of holding parties to account, particularly for the atrocities committed by Daesh. I am sure that we all welcome the news over the weekend that not just in Syria but in Iraq Daesh has been defeated. However, no one should be complacent. Organisations such as Daesh continue to rear their head elsewhere in the world, but on Daesh’s accountability specifically in Syria the noble Lord will be aware that we progressed positively on the Security Council resolution in September and allocated £1 million for follow-up of those held for crimes committed by Daesh in that country.

The important issue of Yemen was raised by both the noble Lord and the noble Baroness. We continue to make representations across the piece: this issue was discussed by my right honourable friend in all the countries he visited. We all share deep concern about the humanitarian crisis. We continue to implore for the opening of all humanitarian corridors, and we raise that issue consistently with Saudi Arabia as well as other players in the region, including Iran. The continued support of different groups in that country is ultimately leading to the humanitarian suffering that we have seen, which has been all too apparent. The recent killing of the former President has led to a further escalation of the political vulnerability on the ground. That said, this is a major issue, a key priority and I assure noble Lords that we will continue to represent the voice of humanity in resolving this conflict at the earliest opportunity. We continue to work with other countries in the region to seek an early resolution.

The noble Baroness also raised more general points about our trade relationship and the specific issue of the Iranian bank account. These continue to be part of the discussion. She will be all too aware that there are certain phases of compliance within the nuclear deal that was struck. We are certainly minded to consider that all agencies and authorities have reported Iran’s adherence to the deal, and continue to move forward in a constructive pattern. As any decisions are made, I will of course share that with the noble Baroness as appropriate.

That said, I can say to all noble Lords that the visit to all the countries was positive. With Iran specifically, discussions were open and candid but also, importantly, constructive.

[Lord Lamont of Lerwick (Con)]

My Lords, I refer to my entry in the Register of Lords’ Interests, being both the chairman of the British-Iranian Chamber of Commerce and the Government’s trade envoy to Iran. I wholeheartedly agree with what is being said about Nazanin Zaghari-Ratcliffe and Mr Foroughi. I have been in touch with Mr Foroughi’s son about this tragic case.

First, will my noble friend confirm that, on 14 and 15 January, President Trump has to decide whether to waive the sanctions against Iran under the nuclear deal? If he fails to do this, secondary sanctions, which have been lifted in the United States, will spring back into action, and that will legally be a breach of the JCPOA, and will certainly be regarded by Iran as such. That will make it even more difficult for Europe to trade further with Iran.

Secondly, on the question of the Iranian embassy bank account, have the Government considered using the Bank of England there? Does it have sovereign immunity? It is difficult to imagine the Bank of England being prosecuted by the American authorities.

[Lord Ahmad of Wimbledon]

My Lords, my noble friend speaks from a deep knowledge of the bilateral relationship between the United Kingdom and Iran, and I commend his efforts. He raises the important issue of the nuclear deal. We have certainly been clear. I alluded earlier to the fact that the Prime Minister has been very clear to President Trump on the implications of the decision of the United States. On the specific dates my noble friend mentioned, I shall check the implications and what is pending. I believe that he is correct. The United States, not being part of the nuclear agreement, puts strain on the continuing sustainability of that deal. In saying that, I refer to a point I made earlier: it makes it even more vital to consolidate our efforts and collaborate with other partners, including our efforts through the E3 to ensure that the deal is sustained.

On my noble friend’s point on the Bank of England’s status vis-à-vis the bank account, perhaps I can write to him. Having spent 20 years in financial services, I know that various rules and regulations govern both the central bank and other private banks that may be operating.

[Lord West of Spithead (Lab)]

My Lords, I wonder whether there was discussion on Lebanon. Hezbollah has trained up to a very high level in the fighting within Syria, and all the intelligence reports point to the fact that Lebanon is again about to degenerate into civil war. Was there any discussion between the Foreign Secretary and the Iranians, who, of course, are pushing Hezbollah very strongly?

[Lord Ahmad of Wimbledon]

The noble Lord is right to raise that issue. Yes, there were wide-ranging discussions on all the places where Iran has an influence. Certainly Lebanon featured, as we have been concerned about the situation that has been unfolding, particularly with the leadership and the resignation of the Prime Minister in Lebanon. All those issues were raised bilaterally, as was the importance of ensuring greater stability—that wherever Iran has an influence, it brings it to bear in the positive implications of regional stability, including in the important country of Lebanon.

[Lord Hannay of Chiswick (CB)]

My Lords, will the Minister accept my view that the Foreign Secretary was very wise to have gone to Tehran? He seemingly, from the Statement, handled the meetings there well, and his measured handling of the public presentation of the visit is also excellent, which is not invariably the case. Does the Minister accept that it was also good that the Foreign Secretary raised the Persian service issue, as well as the issue of the dual nationals? What has been done to the Persian service and to the relatives in Iran is pretty horrifying, so I am very glad he was able to do that.

I have two questions. First, on the JCPOA, does the Minister agree that probably the most important thing that the British Government could do between now and when President Trump has to take the next decision about sanctions is to make it absolutely clear that, whatever decision he takes, we will not reimpose sanctions and will stick to the JCPOA as long as the Iranians stick with it, and that if the Americans wish to isolate themselves in this context, it will be against our wishes and we will not be swayed by it?

Secondly, does the Minister share the view of the International Relations Committee of this House that nothing is served in terms of British interests by an intensification of the rivalry and tension between Iran and Saudi Arabia? Our interest is surely to use our influence with both those countries and their friends to reduce the tension and to try to come to some kind of modus vivendi in the Gulf region which is better than the current state of intense rivalry.

[Lord Ahmad of Wimbledon]

My Lords, I thank the noble Lord for his kind remarks, and I shall endeavour to convey them to my right honourable friend the Foreign Secretary. The point he makes on the JCPOA is very pertinent, and that is why both my right honourable friends the Prime Minister and the Foreign Secretary have raised these issues directly with colleagues and US representatives in Washington, including directly with President Trump. As I have said repeatedly from this Dispatch Box—as have Ministers in the other place—the UK is firmly committed to retaining the JCPOA for exactly the reasons mentioned by the noble Lord. We will continue to lobby the US in that respect.

The noble Lord’s second point was on Iran and Saudi Arabia. I have always maintained that the importance of Britain’s role is to have that sense and strength of diplomacy. We have that strength of communication in retaining those vital links with the likes of both Iran and Saudi Arabia. Never have those links been more important than in the current challenges we face. As noble Lords know, there is a deeply embedded issue that goes beyond just political rivalries, but it is equally important that we not only sustain communication channels bilaterally but continue to strengthen them in calls to the wider region for greater stability.

[Lord Soley (Lab)]

My Lords, the conflict in Yemen is essentially conflict between Saudi Arabia and Iran. I know that the Government are aware of that. One of the problems is that the countries in the region are unable to operate effectively against either party to get some sort of agreement. Also, many of their friends outside the region, including the UK and the US, are in a difficult position because they are not seen as wholly independent. Sadly, the UN is unable to be very effective here. I wonder whether the Government have thought a bit outside the box. One of the countries on the edge of the region which has great influence in the UN, and also in peacekeeping operations, is India. Does it have any interest in adding to the pressure on Iran and Saudi to basically back off because the dangers of the spread of conflict are very great?

[Lord Ahmad of Wimbledon]

On the issue of Yemen specifically, the noble Lord is quite correct that the UK continues to make representations. I am sure he will appreciate that our focus—indeed, that of the Foreign Secretary—has been working with countries in the immediate vicinity. For example, the noble Lord may be aware that the Foreign Secretary hosted a meeting of the quint—that is, the United Kingdom, the US, the UAE, Saudi Arabia and Oman—as well as the UN special envoy, which took place a couple of weeks ago on 28 November. The noble Lord mentioned the role of India. That is very much a question for India to answer, but I note his constructive suggestion in that regard.

Because of the nature of how the conflict is evolving and how we have seen the different parties who may be involved in supporting the rival factions in Yemen, it is important to bring in all international players to ensure security and stability there. As I have already said in answer to a previous question, that is more vital now than perhaps it has been for a very long time.

[Lord Howell of Guildford (Con)]

Does my noble friend agree that we all appreciate the efforts of the Foreign and Commonwealth Secretary to deal with the dual nationals’ imprisonment and to uphold the nuclear deal, despite the doubts coming from Washington, and so on? But can we be crystal clear about Iran’s other activities in the Middle East? I appreciate what the noble Lord, Lord Hannay, said about the need for both sides to be more peaceful, but there really will be no prospect of a wind-down of the horrific situation in Yemen—the assassinations appear to be ordered, and then there is the horrific starvation and the constant bombardment by the Houthis—until those revolutionary elements in Iran that are backing it back away themselves, and the more moderate elements, which I am sure exist in Iran, which I am sure that the Foreign Secretary has encouraged, can assert a more reasonable approach. Until that happens, we will see the horrors in Yemen continue, which is a real tragedy.

[Lord Ahmad of Wimbledon]

My noble friend speaks with great experience. I agree with him. As he will be aware, we issued a Statement in November about the missile attack on Riyadh, to which I alluded in the Statement. I agree that the UK has long-standing concerns about Iranian involvement in other regional conflicts, but particularly in Yemen, which we have raised directly with the Iranian Government. I alluded to the constructive yet candid exchanges that we had—and on this occasion, those that my right honourable friend the Foreign Secretary had—particularly in light of the provision of weapons to the Houthis and forces aligned to former President Saleh. This is very much contrary to Security Council Resolution 2216 and the Security Council’s embargo on the export of weapons by Iran. My noble friend raises some very valid points, but I reassure him and all noble Lords that we continue to raise these issues of concern about Iran’s wider influence—including, as we heard from the noble Lord, Lord Soley, in areas such as Lebanon—to ensure that Iran takes its responsibilities seriously. When we see suggested violations of any provisions or embargos, we raise them proactively in our bilateral exchanges with Iran.

[Lord Kilclooney (CB)]

My Lords, does the Minister agree that one of the more recent matters of concern in the region is the complete breakdown in communications between Saudi Arabia, the UAE and Bahrain, and Qatar? This was raised earlier, but there was no answer to it. Is he aware that Qataris cannot go to funerals in Saudi Arabia any longer, that Qataris who are being educated in Saudi Arabia can no longer complete their education courses there, and that sick children receiving specialist medical treatment in Saudi Arabia can no longer go there to complete their treatment? Is he aware that that means that both Iran and Russia are showing an interest in what is happening in Qatar? When the Foreign Secretary was in the UAE, did he observe any lessening of the division between those countries, or is the separation and lack of communication going to continue?

[Lord Ahmad of Wimbledon]

The noble Lord is right to raise this issue. We continue to raise the issue of relations with Qatar with the rest of the GCC. The noble Lord will be aware of the efforts that Kuwait has been making in that respect, to which we have certainly lent our strong support. In the recent visits to the UAE by the Foreign Secretary, the very point that the noble Lord raised about the importance of constructive engagement, to ensure that the current status with Qatar can be addressed very quickly—not just by the UAE but by the wider GCC—was very much part of the discussions that took place. I assure the noble Lord that that remains an area of focus for the British Government.

[Lord Judd (Lab)]

My Lords, clearly there is much in the Statement to be welcomed. It is equally clear that the visit by the Foreign Secretary had a number of highly commendable outcomes. Is it acceptable to emphasise that we should put on record our appreciation of the immense hard work that has gone on in the Foreign Office to prepare the way for this visit? Does this not illustrate several crucial points for the future of our foreign policy? Is it not unfortunate that on human rights—and I am very glad that the Foreign Secretary raised the issue of executions and the treatment of prisoners in Iran; it is an appalling story—there is no difference between that issue and that of the nuclear agreement? If the nuclear agreement goes wrong, there will be immense potential consequences for the people of Iran, and for others throughout the world. The success of the deal is very much a human rights issue for ordinary people across the world.

On Yemen, can the Minister assure us that the Foreign Office is in constant contact with the humanitarian agencies that are courageously endeavouring against all the odds to try to meet the humanitarian challenges there? Does not that raise the issue that we must keep our strategic approach towards Saudi Arabia under review? We cannot on the one hand be sycophantic towards Saudi Arabia and, on the other, recognise the part that it plays in what is happening in the tragic events of Yemen.

Does not all this show that, in our future foreign policy, whatever the outcomes of Brexit, we must have the closest possible collaboration with our European partners because, in the years ahead, the issues that may arise in the United States are deeply troubling?

[Lord Ahmad of Wimbledon]

My Lords, the noble Lord raises an important point, as he has illustrated, about keeping and retaining communication. The sheer fact that my right honourable friend the Foreign Secretary visited Iran sends a very clear message about the importance and nature of British diplomacy. Yes, we are strong allies of Saudi Arabia, but it is very much the relationship and alliance that we have with Saudi Arabia that allows us to address some important matters.

The noble Lord raised a very practical point about working closely with other EU countries. I can give no better example than the United States’ recent declaration of Jerusalem as the capital of Israel. The statement made at the UN Security Council reflected the unity of other members of the Security Council, including our European allies. We stood shoulder to shoulder to say that, yes, we wish to see a secure and safe Israel but, equally, we want to see a viable Palestinian state. The Government’s objective was reflected in the unity that we saw with other members of the Security Council. Notwithstanding our strong and deep relationship with the United States, when we have disagreements we will raise them and we will show that we will be distinct in our status, as we have shown over east Jerusalem. Therefore, I hope the noble Lord recognises—I know he does—the efforts that the Foreign Office has made. He will be all too aware, as a former Foreign Office Minister, of the importance of British diplomacy in this regard. When I look around the world, British diplomacy is quite incredible. Our ambassadors and high commissioners are an important link, and it is those relationships that we nurture across the piece that allow us to have the candid and honest discussions that we have on the international stage.

[Lord Dear (CB)]

My Lords, at the conclusion of this short debate, may I change the focus to Oman and immediately declare an interest? Two or three weeks ago, I spent two weeks there as a guest of my son-in-law, who is the senior British Army officer in that theatre. With him, unofficially, I met a number of very high-ranking Omani officials, including some at ministerial level, and a lot of Omanis at what one might loosely call street level. What came through very clearly from that wide spectrum of association was the tremendous warmth that exists towards this country and the value that they place on our military support. Recognising that there is no formal signed treaty between this country and Oman—nothing has ever been formalised in the many years that we have had that close association—does the Minister recognise, and can he reassure the House, that the warm bilateral relationship going both ways, from the Omanis to us and vice versa, will continue, and we recognise the importance of that relationship in the Gulf?

[Lord Ahmad of Wimbledon]

The noble Lord is right to raise Oman. I know from my own experience that it is not only a friend but a long-standing British ally in the region, with many shared interests. The noble Lord alluded to various relationships. We share common interests with Oman in the economic, military, counterterrorism and intelligence fields, to name but a few. Let us also not forget that Oman was instrumental in ensuring that Iran came to the table for the historic agreement nuclear deal to which I referred. I reassure the noble Lord that we continue to strengthen our working relationship with Oman. From his previous role he will be very much aware that we have recently increased our support for international best practice by training Omani police in UK police techniques.

Sudan and South Sudan

Lord Ahmad of Wimbledon Excerpts

Monday 11th December 2017 Lords Chamber

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I join noble Lords in thanking the noble Baroness, Lady Cox, for tabling this important debate and in acknowledging her long-standing commitment to humanitarian issues, not just in Sudan and South Sudan but beyond. The two countries that we have discussed share a common history, but today each faces its own unique challenges.

I shall start with Sudan. Ending internal conflict remains a priority, and we welcome the Government of Sudan’s extension of their unilateral cessation of hostilities until the end of this year. We have encouraged them to extend it further. In Darfur, while the security situation remains fragile, there has been a reduction in fighting this year, and better access and security for humanitarian agencies. The joint UN-African Union Mission in Darfur is making progress with reconfiguration, and has begun to redirect its forces away from regions that are now more stable and focus on some of the more challenging areas—for example, on the Jebel Marra area. We are continuing to monitor the reconfiguration closely. Less encouraging, however, is the fact that the Government of Sudan have yet to formally agree to a new base in that area, as mandated by the UN Security Council. Together with other Security Council members, we will continue to urge them to do so.

In the two areas of South Kordofan and Blue Nile, the peace process continues to be hampered by internal divisions within the Sudan People’s Liberation Movement. Civilians in opposition-held areas remain cut off from outside aid. I assure noble Lords that we have continued to urge both factions to move towards a permanent cessation of hostilities and a humanitarian agreement with the Government. In Darfur and the two areas that the UK continues to support, there are African Union efforts to negotiate a comprehensive and mutually agreed peace settlement. I assure noble Lords that we will continue to urge all parties to engage constructively with that process.

I shall pick up on some of the questions that noble Lords have raised. If I cannot answer the questions in the time allocated, I shall of course write to noble Lords. The noble Baroness, Lady Cox, asked about representations that the UK has made specifically on the kidnap of Rudwan Dawod and other supporters of the “Sudan of the Future” campaign. The British embassy in Khartoum is aware of Rudwan Dawod and supporters of that campaign. Improving the human rights situation is a top priority of our engagement with the Government of Sudan. We regularly raise our concerns about specific human rights cases and will continue to do so.

The noble Baroness also asked whether the British embassy in Khartoum was aware of the Government of Sudan’s policy of land confiscation from Sudanese civilians. The embassy is aware, and officials from the embassy continue to raise our concerns about the issue with the Government of Sudan as part of our ongoing bilateral dialogue.

The noble Baroness, Lady Cox, and the noble Lord, Lord Alton, raised the issue of financial support to the Sudanese armed forces to strengthen capacity. I assure noble Lords that the UK does not provide any support to the Sudanese armed forces that could improve their military capacity. All engagement with the Sudanese armed forces is centred on compliance with internationally recognised human rights standards. One of the UK’s defence objectives in Sudan is to promote the observance of international humanitarian law by the Sudanese armed forces through the delivery of a range of courses focused on international standards, human rights and international humanitarian law. I assure noble Lords that the UK is not providing support to the Sudanese armed forces for capacity building.

The noble Lord, Lord Alton, raised the issue of Boko Haram. I shall of course look into it and, if I may, write to him in that respect.

[Lord Alton of Liverpool]

I am most grateful to the Minister, but could he confirm the figure that I was given of £400,000 from the CSF fund?

[Lord Ahmad of Wimbledon]

We are providing support through the fund. Perhaps I may confirm both elements of that in my letter to the noble Lord.

The noble Baroness also raised the issue of the UK Government ensuring that the Government of Sudan are complying with the conditions of the US lifting sanctions. We welcome the decision, to which the noble Lord, Lord Collins, also referred, that progress had been made in five key areas. As noble Lords are aware, these include humanitarian access to conflict-afflicted regions, non-interference in South Sudan and maintaining the Government’s cessation of hostilities in Darfur and the Two Areas. I assure noble Lords that we used the fourth session of the strategic dialogue on 16 October to agree steps that the Government of Sudan would take to address human rights issues—a point raised by the noble Lord, Lord Collins—and to discuss specific issues, including sexual and gender-based violence, freedom of religion or belief, freedom of expression and the convention against torture. We also used it to discuss corruption, a point also raised by the noble Lord, Lord Collins.

The noble and right reverend Lord, Lord Harries, focused his contribution on the important element of the humanitarian situation in Sudan. I assure noble Lords that we acknowledge and recognise that over one-third of Sudan’s population lives in poverty, and nearly 5 million Sudanese are in need of support. The UK is an important donor: we give £50 million a year to Sudan, focusing on providing life-saving humanitarian assistance to over 550,000 internally displaced people and South Sudanese refugees every year. The noble Lord, Lord Collins, also raised this concern. We continue to work with the international community to reform the approach to the long-term displaced in Darfur.

The noble Baroness, Lady Cox, and the noble Lord, Lord Luce, raised the issue of the UK Government considering working more closely with local partners, including the churches, in South Sudan. The UK Government are clear that the renewed peace process in South Sudan, led by IGAD, must allow full engagement of non-armed actors including, importantly, faith groups such as the South Sudan Council of Churches. The UK has recently agreed a package of funding that will help that council to implement its action plan for peace, which promotes the development of neutral forums in South Sudan where an inclusive dialogue can take place.

The noble Lord, Lord Alton, also mentioned the trade event that is taking place. This is a private event and I can assure the noble Lord that the Government have not provided any financial, logistical or administrative support for it. We believe that opening up trade can help isolated political and economic systems and thereby help to improve human rights. I further assure the noble Lord that, in this regard, the position of President Bashir is clear. The UK remains a strong supporter of the ICC and encourages all states to act on its indictment.

[Lord Alton of Liverpool]

Will any British officials be speaking at that private event?

[Lord Ahmad of Wimbledon]

I can confirm that our ambassador to Sudan will be speaking.

The humanitarian situation in South Sudan is very grave, as we have heard from various noble Lords. My noble friend Lady Anelay spoke very poignantly and with great expertise and insight. The noble Lord, Lord Hussain, has also visited the region. In response to my noble friend, the UN Security Council has renewed the mandate and the UK strongly supports the UN mission in South Sudan. All members of the Security Council have also agreed with the Secretary-General’s recommendation for a two-month technical rollover of the mandate. This will allow for the UN strategic review to report to the Security Council on detailed recommendations for the mission’s mandate. My noble friend also raised the issue of the IGAD-led peace process through a sustained campaign of engagement by Ministers and senior officials. We continue to put pressure on all sides of the conflict to engage meaningfully with IGAD’s revitalisation forum to end hostilities, negotiate a ceasefire and allow full humanitarian access.

My noble friend also asked whether we are working closely with our troika partners. We are doing so, and with key actors in the region, to drive forward peace talks. My noble friend was the special representative on preventing sexual violence in conflict under the previous Prime Minister. I have now taken over that role. I commend her valuable work in this regard and assure her and the noble and right reverend Lord, Lord Harries, that South Sudan remains a priority country for preventing sexual violence and is one of the focus countries for the fourth UK national action plan.

Furthermore, through our humanitarian response and resilience in South Sudan programme, and working with our UN and NGO implementing partners, the Department for International Development is providing another £443 million in aid to support the provision of food and emergency shelter.

The noble Lord, Lord Collins, and my noble friend Lady Anelay also asked about the insistence on compliance with international humanitarian law and human rights. I assure noble Lords that the UK Government are clear—as a Minister responsible for human rights, I am also clear—that human rights abuses committed in South Sudan are unacceptable and that all sides must make concerted efforts to bring them to an end. Our concerns are raised forcefully with the Government of South Sudan at every available opportunity.

If I may, I will write to noble Lords on the remaining questions. The noble and right reverend Lord, Lord Harries, raised the regional protection force. The RPF is in the process of deployment and the UK Government continue to support it, but I will write in more detail in this respect.

Several noble Lords, including the noble and right reverend Lord, Lord Harries, raised the importance of humanitarian aid. This year, the UK’s humanitarian response will provide drinking water to 300,000 people and food to over 500,000 people. We are also supporting neighbouring countries hosting 2 million South Sudanese refugees.

In conclusion, I assure all noble Lords that the UK remains fully committed to working towards peace, security and prosperity for the people of both Sudan and South Sudan and the protection of human rights, ensuring that the perpetrators of sexual violence are brought to justice. In Sudan there are promising signs that continued constructive engagement with the international community can, over time, lead to greater security and prosperity for the Sudanese people. In South Sudan the outlook is far less promising. Without outside help many South Sudanese will continue to suffer in the most appalling conditions. I assure noble Lords that the UK will not stand idly by. Through our dialogue and through UK aid we will continue to provide vital assistance to those most in need, and we will continue to do all we can to encourage both parties to cease fighting and start talking about peace. The people of the world’s youngest country have the right to a better future and the UK Government take their role very seriously in this regard.

Sanctions and Anti-Money Laundering Bill [HL]

Lord Ahmad of Wimbledon Excerpts

Committee: 3rd sitting (Hansard - continued): House of Lords
Wednesday 6th December 2017 Lords Chamber

[The Minister of State, Foreign and Commonwealth Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, we are coming to the end—this is the last group. The noble Baroness has given a detailed exposition of the reasons behind the proposed amendments. I can say quite clearly that the Government do not agree with her position. She used phrases such as “the Government going it alone”. Throughout the Committee stage—and today with my noble friend—I have articulated the fact that with the FATF we have led the way. These are areas where Britain is ahead of the curve, not behind it. Perhaps I can answer some of her questions directly, and I will also look carefully at her contribution in Hansard.

Schedule 2 provides further detail on the scope of the anti-money laundering and counterterrorist financing regulations that can be made under Clause 41. Paragraphs 1 to 17 of this schedule confirm that regulations made under Clause 41 can cover the topics already addressed in the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

The noble Baroness quoted a few paragraphs. I will quote a few in return. For example, paragraph 4 confirms that regulations made under Clause 41, which she referred to, can require prescribed persons to take specified actions in relation to customers in prescribed circumstances.

The money laundering regulations 2017 currently give effect to the international standards set by the Financial Action Task Force and EU law, by including provisions of this type which require regulated firms to conduct varying levels of due diligence on their customers on a risk-sensitive basis. Further, and for example, paragraph 7, which I think the noble Baroness also mentioned, confirms that regulations under Clause 41 can confer supervisory functions—and corresponding powers—on supervisory authorities, such as the FCA. Other paragraphs within the schedule similarly clarify or supplement other aspects of regulations under Clause 41. For example, paragraph 18 provides that regulations made under Clause 41 cannot provide for criminal sentences that exceed the statutory maximums already established through the money laundering regulations 2017. Section 7 of the Proceeds of Crime Act 2002 provides for longer prison sentences of up to 14 years; these provisions should be seen in that wider context.

Finally, the noble Baroness mentioned paragraph 20 on a few occasions. This paragraph confirms that regulations made under Clause 41 may make provision corresponding or similar to the money laundering regulations. Sub-paragraph (2) also confirms that regulations made under Clause 41 can be used to amend or revoke the money laundering regulations. Indeed, this is exactly what was done when the money laundering regulations came in to replace the 2007 regulations. This is not something new that has been created.

[Baroness Kramer]

When the money laundering directive came in, there was, through the cascade mechanism, a framework within which the regulations sat. Will the Minister at least acknowledge that that framework is the missing piece here? Does he acknowledge that the cascade structure, which was a backbone to make sure that the framework and the principles were translated down through the system, is also missing here? Amendment and revocation had to be within that context, with those constraints and principles. The new amendment that he quoted has no such constraint or principle sitting around it. That is the whole point that everyone is attempting to make in this discussion. He needs to tell us why the Government have chosen that route, where those frameworks, principles and backbones are eliminated.

[Lord Ahmad of Wimbledon]

The noble Baroness says “everyone”. I know that she and the noble Baroness, Lady Bowles, made that point but I do not agree. She has made her point and I have listened; perhaps she should listen to the point that I am making in response.

As the noble Baroness says, Schedule 2 ignores the cascade of information. The power in Clause 41 will enable us to update and amend existing legislation that does this, as we did when the regulations were replaced this year, as I have already mentioned. This should not be viewed in isolation, which I fear is what the noble Baroness is doing. When new categories of risk manifest—the noble Baroness, Lady Bowles, talked about virtual currency exchanges—new legislation will be needed, and this power helps to fill that gap.

In sum, Schedule 2 sets out examples of the scope of the anti-money laundering and counterterrorist financing power contained in Clause 41, and it defines the limits of this power in relation to criminal penalties. The noble Baroness, Lady Bowles, ignores proportionality. However, this issue must be looked at in the wider context, not in isolation. Ministers are bound to use these powers proportionately, taking account of people’s human rights, and they are bound by Section 6 of the Human Rights Act 1998. I therefore contend that Schedule 2 should stand part of the Bill.

Perhaps I may briefly mention Amendment 71A, which I understand is related to the opposition of the noble Baronesses, Lady Kramer and Lady Bowles, to Schedule 2. To give an example, the reference in paragraph 2 of Schedule 2 to regulations, mentioned by the noble Baroness, being capable of requiring,

“prescribed persons to identify and assess risks relating to money laundering, terrorist financing and other threats to the integrity of the international financial system”,

corresponds with regulations 16 to 18 of the money laundering regulations 2017. These require the Government, supervisors and regulated firms to assess the risks of money laundering and terrorist financing at a national, sectoral and business level as appropriate so as to inform the nature and extent of any due diligence measures applied by regulated firms.

Perhaps I may give a further example. The reference to “prescribed persons” in paragraph 4 of Schedule 2, which again the noble Baroness quoted, corresponds to Part 3 of the money laundering regulations 2017. This establishes a framework giving effect to the standards of the Financial Action Task Force relating to simplified and enhanced customer due diligence, which I am sure we all welcome. Again, this is not about the UK going it alone; it is about how we are part and parcel of the FATF.

Therefore, the amendment would not remove the Government’s ability to designate categories of business as regulated for anti-money laundering purposes, or designate supervisors. These purposes are already permitted under Clause 41 and are referred to in Schedule 2.

There may also be a number of areas where we want to confer functions upon persons to assist with the implementation and enforcement of sanctions. I think that the noble Baroness, Lady Bowles, startled the doorkeepers when she quoted various examples. Captains of ships and harbour masters, for example, might need to exercise functions in order to comply with shipping sanctions. We might also need to confer functions to help enforce sanctions on border officials, agents of Her Majesty’s Revenue and Customs, or law enforcement agencies, such as the National Crime Agency.

I know the noble Baroness. She is well versed in the money laundering issue, and I respect that. That is why I said at the outset that I will listen again, or read, I should say—listening to Hansard may be stretching it a bit—her contribution very carefully and see if there are aspects that need further amplification and explanation from the Government. I hope that through my practical examples I have addressed some, if not all, of her concerns and that at this point, she will be minded to withdraw her amendment.

[Baroness Bowles of Berkhamsted]

I thank the Minister for his reply. I fear that a large part of it merely proved my point that small extracts have been turned into powers. I maintain that without the surrounding framework to give proportionality, you do not need everything that is in there. It is difficult—

[Lord Ahmad of Wimbledon]

I was merely giving a few illustrative examples. Like the noble Baroness mentioned, I think she and I would be the only ones here if we carried on in this respect. What I was doing was merely illustrating, but it is dealt with comprehensively.

[Baroness Bowles of Berkhamsted]

That is the point. It is converted into a power very comprehensively but it just takes the first section. For instance the one I quoted does not even point out that they are responsible only for what goes on in their own business. That makes it very difficult. A lot of this could be dealt with by putting in those proportionality statements and a few more things.

The other source from which this list of powers has been obtained—which I think the Minister was referring to—is the FATF recommendations. However, you have to bear in mind that the FATF is an organisation meant to look at risks to the financial system, terrorist financing and those kinds of things. It is not set up with a branch to deal with civil liberties or even human rights. It leaves that to the nation states which are then going to implement. I could probably find it in the FATF but it is too late in the evening to do that. You cannot just put the list of powers or of things that the FATF wants you to do into powers without acknowledging that there has to be a framework.

Yes, there may be human rights elements that we have not abolished, nevertheless there are more things—

[Lord Ahmad of Wimbledon]

To clarify, I said that we need to look at this in the wider context. That is why I referred to the obligations that Ministers are bound by in the Human Rights Act. That is part of our statute, so we are obliged to follow that.

[Baroness Bowles of Berkhamsted]

Unfortunately, it seems that that ends up in the courts from time to time, which is very difficult for the sorts of people that might find themselves entangled in this. My plea is really that we just make an effort to get this a little bit more right. In that spirit, I will not be pressing Amendment 71A, which was linked to the creation of supervisory powers, which was why it was in the same group. This issue is one that we will wish to return to in general on Report.