Private International Law (Implementation of Agreements) Bill [Lords]

Dehenna Davison Excerpts

Committee stage & 3rd reading & 3rd reading: House of Commons & Committee stage: House of Commons & Committee: 1st sitting & Committee: 1st sitting: House of Commons & Report stage: House of Commons
Tuesday 6th October 2020 Commons Chamber

[Jerome Mayhew (Broadland) (Con)]

I cannot match the technical analysis of my hon. Friend the Member for Bromley and Chislehurst (Sir Robert Neill), but I hope I can bring to today’s deliberations some practical experience of the implications of new clauses 2 and 5.

The honouring of agreements has been at the heart of international trade since such trade began, but it is worth remembering that Governments have not always supported international trade. If we look back at the approach of our Government and other Governments in Europe from the 16th and 17th centuries, and even well into the 18th century, we see that we operated mercantilist policies that actively prevented international trade. Such trade was discouraged to protect domestic manufacturing. Policies such as high border tariffs were implemented, and there were even export bans on tools that could be used to improve manufacturing in third countries. Many arcane rules and requirements to use local suppliers and local trades were implemented to make it harder to undertake international trade.

There was also no support for the legal enforcement of contracts. Consequently, businesses had to make their own arrangements, which were founded primarily on personal trust and the reputation of organisations and families. I have some personal experience: I was once recruited by my brother to work in his company, eventually as the managing director. His rationale was that he had no idea whether I was competent at anything but did know that I was unlikely to steal from him. I will leave it to other people to decide whether that was ultimately good for the economy of that business. On an international basis, that approach has been disastrous: throughout the 16th, 17th and 18th centuries there was a general stultification of growth.

I am delighted to say that it was the United Kingdom that led the world away from narrow protectionism and towards free trade. That great man Adam Smith led the charge. He destroyed the argument for protectionism, demonstrating the desirability of imports—they are more efficiently produced and therefore cheaper—and stating that exports were merely the necessary cost of acquiring them. It was through this place that we led the way in the repeal of protectionist laws: first, with the Reciprocity of Duties Act back in 1823, and then much more famously with the repeal of the corn laws in 1846. What was the result? We see it if we look around us today: the explosion of world trade.

PIL agreements have been crucial to the modern support of international trade. They bring legal certainty, deal with conflicts of jurisdiction and allow for judgments to be enforced internationally. The Bill helps to achieve those aims, particularly as we transition from EU membership into the big wide world. That transition period, to which I shall come back later in my speech, is relevant because of the time constraints that it imposes on Her Majesty’s Government.

I want to return to my first-hand experience of the impact of PIL agreements. I was the managing director of a UK-based SME that was entrepreneurial in its outlook, and we were doing pretty well in the UK, so naturally I looked to international markets as a means for expansion. In my time, I negotiated joint ventures in Russia, the United States of America, Australia and South Africa, as well as undertaking preliminary discussions in a number of other jurisdictions. It was noticeable that the only two joint ventures that we progressed to fruition were those in the United States of America and Australia, and the fundamental reasons that I felt unable to progress further in those other jurisdictions were the fears over the enforceability of contracts, particularly in relation to intellectual property, and the fears over the effectiveness of the rule of law in those jurisdictions. PIL agreements affect countless such economic decisions all around the world and in this country every day, so we must not underestimate their importance for economic decisions just like the ones that I took.

There is an urgent need for more PIL agreements, particularly as we move out of the transition period. They are an integral part of our pivot towards global Britain, and there should be no unnecessary delay in the Government’s ability not only to negotiate such agreements but to bring them into force. International enforceability is key to trade growth and to London remaining the centre of dispute resolution around the world. It is also key to the continued dominance of English and Welsh law, and it is worth reminding ourselves that that law is dominant because it is predictable in its interpretation and its enforceability. That is a key advantage for this jurisdiction.

I understand well the concerns that have been raised by old clause 2 and new clause 5. As a Back Bencher, I stand here to defend the rights of Parliament, but it is also right that I should do that with a sense of proportion. PIL agreements are significant—I have done my best to explain how significant they have been to international commerce—but they are fundamentally uncontroversial. They are not major treaties in the sense of Maastricht, which was mentioned by a previous speaker, and we need to have some practical considerations weighing on our mind as we decide whether we should implement new clause 5.

The transition period is a time when we should be lifting our eyes to the wider horizons of international trade, and that is going to mean many more PIL agreements. As my hon. Friend the Member for Henley (John Howell) highlighted, the Government’s agility, and their ability to strike while the iron is hot to take advantage of this brave new world into which we are entering, are material practical considerations. We also have the legislative timetable to consider. It is already clogged up with covid-related delays, and to require multiple Acts of Parliament to be progressed through that clogged-up timetable in order to progress time-sensitive and time-critical agreements would be disproportionate. It would create negative delay for the Government’s domestic agenda as they seek to progress this stodge, and delay for the implementation of the agreements themselves.

As a businessman and as a Back Bencher defending the rights of this Parliament, I operate with that sense of proportion, and my conclusion is that it would not be proportionate to prevent the Government from using secondary legislation in this manner. Consequently, I support the Government’s new clause 5 and I am against new clause 2.

[Dehenna Davison (Bishop Auckland) (Con)]

I rise today not as a lawyer, surprisingly—like many right hon. and hon. Members across the House—but merely as someone who has taken an interest in the Bill because I want the best for my constituents. I often joke that I am bilingual, because I can speak standard English and northerner, but I do not speak legalese, so Members may have to forgive me for a bit of plain speaking on this one.

New clause 5, which has been the subject of much discussion, effectively sets out the procedure by which international agreements on legal disputes are brought into UK law. The new clause would allow Ministers to implement treaties via an affirmative statutory instrument, rather than going through the full primary legislative process.