Crown Dependencies

Lord Faulks Excerpts

Tuesday 12th July 2016 Lords Chamber

[Lord Beith]

To ask Her Majesty’s Government what recent discussions they have had with the Governments of the Crown dependencies about the dependencies’ relationships with other countries and with the European Union.

[The Minister of State, Ministry of Justice (Lord Faulks)]

My Lords, regular dialogue happens between the UK Government and the Crown dependencies at both ministerial and official level across a range of issues, including Crown dependencies’ interests in relation to the EU and other countries. This has become especially important in the light of the result of the EU referendum, and on 27 June the Prime Minister confirmed that the Crown dependencies will be consulted on any new negotiation with the European Union.

[Lord Beith (LD)]

My Lords, although the Channel Islands and the Isle of Man are not in the EU, they benefit from the single market in goods. They also have a pressing need to conclude bilateral investment treaties with a number of third countries. Given the huge task facing UK negotiators, what mechanism will be put in place to ensure that Crown dependency interests are not lost sight of in EU negotiations? In order that third country treaty negotiations do not grind to a halt, will more use be made of letters of entrustment, so that they can get on with the job themselves?

[Lord Faulks]

The noble Lord has had a continued interest in the Crown dependencies: as chair of the Justice Select Committee, he wrote an influential report and a subsequent report in 2014, in which he applauded the response of the UK Government to the challenges that the Crown dependencies threw up. As the Prime Minister said, we are most concerned to ensure that the Crown dependencies’ interests are reflected in any negotiation. We are also anxious to encourage letters of entrustment where appropriate, to ensure that those interests are recognised in all treaties. There was a 2007-08 agreement which paved the way for such arrangements.

[Lord Watts (Lab)]

What would the effect of our leaving the European Union be on Gibraltar’s borders?

--- Later in debate ---

[Lord Faulks]

My Lords, there will be no immediate change in the way Gibraltar’s people can travel, or how its services can be sold. The Government are most anxious to maintain the Gibraltar-Spain border: it is one of our top priorities. As for the details, I am afraid that, as with so many things in this negotiation, we will have to wait.

[Baroness Ludford (LD)]

I, too, want to ask about Gibraltar. Obviously it is not a Crown dependency, but naturally there is a great deal of concern in Gibraltar, whose inhabitants voted remain, not only about the economy but also that Spain will be emboldened to press its sovereign claim. How will the Government protect the interests of Gibraltar in all those dimensions?

[Lord Faulks]

As the noble Baroness says, Gibraltar is not a Crown dependency—the subject of this Question. None the less, the Government of Gibraltar have put forward some specific ideas for ensuring that trade will continue between the UK and Gibraltar, and we look on this matter as a priority. We also continue to uphold sovereignty over British Gibraltarian territorial waters by challenging and protesting all incursions, and we are continually monitoring the situation. We will continue to do so, and the long-term aim is to return to the trilateral forum for dialogue between the UK, Spain and Gibraltar.

[Lord Faulkner of Worcester (Lab)]

As regards the Channel Islands, I declare an interest as chairman of the Alderney Gambling Control Commission. The Minister enjoys a very high reputation in the islands and is known to be a friend of them. I know how much trouble the disagreement caused by Defra over the Guernsey fisheries agreement caused him and the MoJ last year. Putting that to one side and looking ahead to the post-EU world, does he accept that Channel Islands Governments will have the constitutional right to legislate on such matters as fisheries in future, and to take greater control over their international agreements?

[Lord Faulks]

I am grateful to the noble Lord for his comments. Of course, we do our best to maintain the relationship between the Ministry of Justice and the Crown dependencies. I spoke to all the Chief Ministers on the day of the referendum and attended the APPG meeting. We are anxious to ensure that the relationship is secured for the future. Of course, the noble Lord is aware of the fisheries dispute with Guernsey. That is the subject of litigation, so I cannot comment further on it. As I said earlier in answers to questions, we are anxious that there should be an appropriate degree of autonomy, and that each of the Crown dependencies should be able to secure matters that are in their interests. Of course, how matters finally turn out following the conclusion of our negotiations is difficult to predict with exactitude.

[Lord Flight (Con)]

My Lords, among the first batch of non-member territories expected to receive AIFM passporting towards the end of this year are Guernsey and, I believe, Jersey, as well as Hong Kong and the USA. Does the Minister feel that if that goes ahead it could be an extremely helpful precedent for this country when potentially negotiating passporting?

[Lord Faulks]

Passporting is extremely important. Negotiations about the UK’s future relationship with the EU have not started and we should not assume their outcome. However, we are acutely aware of how important passporting rights for financial services are everywhere.

[Lord Davies of Oldham (Lab)]

My Lords, the House will be reassured by the Government’s solicitous concern for the dependencies but sometimes it seems to be somewhat one-way traffic. We are concerned about their interests but to what extent do they fulfil their obligations to concern themselves with British interests, particularly on the question of successful taxation of multinational global companies, and the whole issue of their taxation regimes in relation to ours?

[Lord Faulks]

My Lords, in April, the Government secured an agreement with finance centres in the Crown dependencies of Jersey and the Isle of Man—Guernsey is yet to sign—to provide the UK law enforcement and tax authorities with unrestricted and near-real-time access to information on beneficial ownership of companies from a central register. This is part of the Prime Minister’s anti-corruption drive. They are playing their part and it is important that they do so.

[Lord Foulkes of Cumnock (Lab)]

My Lords, is the Minister aware that I have asked repeatedly in this House for a regular air service to start to one of our overseas dependent territories—namely, St Helena—but on each occasion the noble Baroness, Lady Verma, has said, “Come and see officials in my office”? I have been in touch with her office and she says that they cannot see me before October. As a distinguished lawyer and well-respected Minister, will the noble Lord use his good offices to find out how I can get an answer?

[Lord Faulks]

It is very difficult to refuse the noble Lord anything. I will, of course, speak to my ministerial colleague and try to ensure that appropriate meetings take place when they can.

[Lord Empey (UUP)]

My Lords, is the Minister aware that the Channel Islands and the Isle of Man have specific relations with the Irish Republic through our treaties that were developed as part of the peace process in 1998, and that those relationships would need to be dealt with separately, as well as the relationships with the rest of the European Union? Are the Government aware of the significance and sensitivity of these relationships, and that they should be preserved at all costs?

[Lord Faulks]

The noble Lord identifies one of an immensely complicated set of relationships which need to be considered in the renegotiation. I accept that this is a matter that ought to be communicated to those with responsibility for the negotiations.