Trade etc. in Dual-Use Items and Firearms etc. (Amendment) (EU Exit) Regulations 2019
(Limited Text - Ministerial Extracts only)
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Baroness Fairhead
That the draft Regulations laid before the House on 4 March be approved.
Relevant document: 53rd Report from the Joint Committee on Statutory Instruments (Special attention drawn to the instrument)
The Minister of State, Department for International Trade (Baroness Fairhead) (Con)
My Lords, I am pleased to open this debate on the Trade etc. in Dual-Use Items and Firearms etc. (Amendment) (EU Exit) Regulations 2019. These regulations do a very serious job. Without them, existing European Union law will not be effective in UK domestic law on the day we exit the EU, a vital part of our long-term planning since Royal Assent of the European Union (Withdrawal) Act.
The regulations include amendments that will allow the UK to maintain those EU laws that control exports of items with both military and civil uses. They will control the export of civilian firearms of the type used by hunters and sports shooters. If we do not retain and amend this legislation, we will no longer control the export of such potentially dangerous items. This will put the United Kingdom in breach of international agreements which require we impose these controls and which prevent military equipment falling into the hands of those who intend this country harm. They also prevent or disrupt the proliferation of nuclear and chemical weapons and play a key part in promoting global security by controlling the strategic goods that leave our shores.
The exit-related legislation provides the necessary legislative building blocks to ensure readiness on exit day. The EU withdrawal Act enables a functioning statute book on exit day by providing Ministers with the tools to deal with deficiencies in domestic law arising as a result of our exit from the EU, so it is right and proper that we use it for matters such as export controls.
By making this regulation and the associated Export Control (Amendment) (EU Exit) Regulations 2019, the department will have completed much of the legislative part of controlling the export of strategic goods in preparation for a no-deal Brexit. If this regulation is no longer required on exit day, we would expect to revoke or end it. Alternatively, commencement could be deferred to the end of an implementation period.
Broadly, all the provisions applying to exports from the EU customs territory today will instead apply to exports from the UK. However, leaving the EU will mean that the rules will have to change, and we cannot guarantee that all the export licensing requirements that UK exporters are familiar with will remain the same. For this reason, the Government have made every effort to provide certainty for businesses and the public wherever possible. We have published a new general export licence, which provides for the export of dual-use items to all European Union member states and the Channel Islands. In August, we published a technical notice on export controls, which explained our plans for post-EU exit export control licensing. We have also included EU exit advice, both in the export control training programme and at the annual export control symposium, as well as giving extensive advice to key sector trade associations.
The House should be aware that the Joint Committee on Statutory Instruments has reported the draft regulations on the grounds that they require elucidation in one respect and were defectively drafted in three respects. On the first point, we provided the committee with an explanation of why the transfer of technology by electronic means to the Isle of Man is considered to be an export whereas the physical movement of goods is not. This is a consequence of our customs arrangements with the Isle of Man and is consistent with our controls on military goods and technology. On the other three points raised by the Joint Committee, we have acknowledged that these are drafting errors that we will correct in the near future by laying a further SI, which corrects the drafting. We are very grateful for the diligent work of the committee, and I am happy to confirm that none of those errors affects the proper functioning of the regulations.
I hope that this House will work in the interests of our nation to ensure the passage of this legislation, which we believe is essential to ensuring that we are prepared for EU exit. I beg to move.
Lord Stevenson of Balmacara (Lab)
My Lords, I am again grateful to the Minister for her comprehensive introduction to this SI. I follow the noble Lord, Lord Purvis, on a number of points and look forward to the responses to them.
I was puzzled by why the version of the SI that we have is not the corrected version, but I think time has probably defeated us on that. I look forward to seeing the final version when it comes out. Having to rerun this debate so quickly might be a little otiose, but it is always a pleasure to have these debates.
My question is slightly broader, and it may be better answered in a letter. The SI concerns the need to amend domestic and directly applicable EU legislation so that it continues to function in relation to the way in which these types of weapons are exported. I could not pick up from what the Minister said—this is why I suggest she might write to us—where this fits into the broader system we set up in early 2000 to try to make sure that exports of weapons as weapons are properly controlled. At that stage it involved three departments of state, but it presumably now involves four. Who has control of that? Are those systems fully operational, and is there any issue there? In a sense, I am confident that there is not, but there is growing concern about the way in which weapons have been used in certain areas. Rather than being used in genuine defence situations, they appear to have been used in internal conflicts and in other scenarios, which was never intended. Therefore, the problem might be that the dual-use material here might also fall into that category, and I wonder whether the Minister can confirm that the broad structure that is there to protect exporters but also to protect our own systems will apply. If so, exactly how will that work in practice?
Secondly, on the same theme, the Explanatory Memorandum makes relatively light work of the new pro forma licences that will be available in the UK to deal with these goods. I do not need a detailed response tonight but I would be interested to know a little more about how these will work in practice. “Pro forma” can be shorthand for not requesting a very detailed exposition from the exporter. I hope that that is not the case. I assume that pro forma means that the licences will be pre-printed and relatively easy to fill in, but I would be grateful to have confirmation of that. What is the system? Where do they go? What are we looking for here? Are these materials are being created under a very deep cut through the system? Will the system track back over rules of origin? Will we be clear where they originated from and where their final destination is likely to be? Presumably all those things will be in a system at some point. Will they be clearly written up and submitted properly, and, if so, to whom, and will they cover all the points that I have made?
Baroness Fairhead
My Lords, I shall try to address the questions directly. Turning to the concern raised by the noble Lord, Lord Purvis of Tweed, I can confirm that controls will apply to cyber capability materials when they are exported to the Isle of Man.
Lord Purvis of Tweed
Part of my point was about exports from, rather than to, the Isle of Man. Currently I am unaware of the Isle of Man taking a very aggressive stance against the rest of the United Kingdom on cyber capability. However, I was anxious about any part of the United Kingdom or the Isle of Man being used for exports to other states. Therefore, it is not only a question of exports from the United Kingdom to the Isle of Man; it is a question of the Isle of Man being the basis for exports from the United Kingdom.
Baroness Fairhead
There are two points that I would like to raise on cyber capability, and to some extent they will also address the process that the noble Lord, Lord Stevenson of Balmacara, asked about. There will be an open pro forma licence for materials going to what we consider to be low-risk territories—that is, the EU. Where there will be a change is if the products go into the EU and are then exported from the EU to another part of the world. Cyber and cryptographic goods are an area that we are taking increasingly seriously. The noble Lord, Lord Purvis, mentioned some of the open general export licences, but only those absolutely consistent with our consolidated criteria are included. All high-risk capabilities are deliberately excluded. As your Lordships will know, the controls on cryptography come from the Wassenaar agreement. There are various agreements that we comply with. The EU Parliament has suggested removing regulation from dual use, but we believe that we have international obligations to implement the controls and we do not agree with that. To be absolutely clear about cyber surveillance, which I believe is a key concern in the work that the noble Lord is doing, cyber surveillance equipment is not included in the open licence.
Regarding the more general impact of our exit on future co-operation with the EU, we absolutely recognise the importance of maintaining close co-operation and hope it will be a key part of the negotiation on our future partnership with the EU.
The noble Lord, Lord Stevenson of Balmacara, raised a subject that is probably for another day. I can just give some reassurance that the Export Control Joint Unit has been created with the Ministry of Defence, the Foreign Office and DIT. DIT is essentially the regulator; the other two departments provide their input, advice and challenge. The unit is established and populated. It is a very important subject but, as I said, one for another day.
I think we all agree that it is critically important that we maintain robust strategic export controls, to fulfil our international obligations and to keep the world safe. I hope that I have been clear about the Government’s commitments to this regulation. I finish by reiterating a key point of my opening statement: that if we do not retain and amend this EU legislation, we will no longer control the export of dual-use goods or firearms. We have a responsibility to ensure the security and safety of our people, and this legislation supports that objective. I commend this Motion to the House.