European Union (Approvals) Bill

Lord Prior of Brampton Excerpts

2nd reading (Hansard): House of Lords
Wednesday 25th October 2017 Lords Chamber

Moved by

[Lord Prior of Brampton]

That the Bill be now read a second time.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Prior of Brampton) (Con)]

The purpose of this Bill is to approve four draft decisions of the Council of the European Union. All four draft decisions rely on Article 352 of the Treaty on the Functioning of the EU. This allows the EU to take action to attain the objectives set out in the EU treaties, for which there is no specific power given. This can be done only with the approval of the European Parliament and the unanimous support of all EU member states.

Before the UK can agree these draft decisions at the Council, Parliament must first give its approval. Section 8 of the European Union Act 2011 provides that a Minister may vote in favour of an Article 352 decision only where the draft decision is approved by an Act of Parliament. The measures in the Bill have already been approved in another place, and I am pleased that noble Lords will also have the opportunity to scrutinise and decide whether to approve them.

The UK is leaving the EU and, until that process has concluded, the UK remains a full member of the EU and all the rights and obligations of EU membership remain in force. This includes exercising the UK’s vote in the Council of the European Union on these four draft decisions. Keeping that in mind, we are content that all four decisions are reasonable, proportionate, in keeping with our best interests and will not result in any additional financial burdens on the UK.

As I have said, Article 352 decisions must be agreed by all EU member states unanimously. When all member states are in a position to vote on the decision, the European Council will schedule a meeting of the Council of the European Union. If all member states vote to approve the draft decisions at that meeting, the European Parliament will be asked in turn to approve the draft decisions. If it does so, the decisions are adopted into EU law. All other member states, apart from the UK, have agreed the decisions. We do not believe that any of these draft decisions should be considered contentious in any way.

The first two decisions will enable two countries, the Republic of Albania and the Republic of Serbia, to be granted observer status in the EU’s Fundamental Rights Agency. The Fundamental Rights Agency was set up to support the European institutions and EU member states by improving the knowledge and awareness of fundamental rights issues in the EU, with a view to ensuring respect for fundamental rights. The agency does this through the collection and analysis of information and data. It can also formulate opinions on specific topics, either on its own initiative or at the request of EU institutions. It also has a role in communicating and raising awareness of fundamental rights, but it cannot hear individual complaints.

EU accession candidate countries can be given observer status at the Fundamental Rights Agency. This allows the agency to collect and analyse fundamental rights data from those countries, but does not allow them the right to vote in decisions as part of the agency’s management board. Albania was granted EU candidate status in June 2014. The UK supported the awarding of EU candidate status on the condition that Albania redoubled its reform efforts, with particular focus on justice and home affairs, especially tackling organised crime, corruption and illegal migration. The UK welcomed Albania’s progress in adopting legislation towards a judicial reform package in July 2016. Albania must now fully implement the judicial reform package as soon as possible so that this can underpin other reforms.

Serbia was granted EU candidate status in 2012 and accession negotiations were launched in January 2014, with the first four negotiating chapters opened during 2016. The UK continues to support Serbia on its reform path, including through funding projects in Serbia. Serbia has more work to do on anti-discrimination policies, to improve the situation of vulnerable people and to ensure freedom of expression. Observer status at the Fundamental Rights Agency should help Albania and Serbia to reform in the areas I have mentioned. Albania and Serbia should also be allowed to benefit from instances of good practice and evidence from other EU member states in relation to human rights. The Government are therefore satisfied of the need to support these two decisions.

The third and fourth decisions are necessary to implement a co-operation agreement between the EU and Canada on competition enforcement. The decisions will allow the agreement to be signed and allow conclusion of the agreement after it has been approved by the European Parliament. This competition co-operation agreement will replace an existing agreement that has been in place since 1999. It replicates and builds upon the provisions in the earlier agreement by allowing the European Commission and the Canadian Competition Bureau to exchange evidence obtained during investigations, including confidential information and personal data. The existing co-operation agreement with Canada dates from June 1999 and, at that time, the exchange of evidence between the parties was not regarded as needed. In the meantime, the bilateral co-operation between the European Commission and the Canadian Competition Bureau has become more frequent and deeper as concerns substance.

The absence of the possibility of exchanging information with the Canadian competition authority is regarded as a major impediment to effective co-operation. The proposed changes to the existing agreement will allow the European Commission and the Canadian Competition Bureau to exchange evidence which both sides have obtained in their investigations. This will, in particular, be useful in all cases where the alleged anti-competitive behaviour affects transatlantic or world markets. Many worldwide or transatlantic cartels include Canada, and, via Canada, the Commission will get a good opportunity to have access to additional information concerning these cartels.

Co-operation with third-country competition authorities is now standard practice in international competition investigations. In addition to the agreement with Canada, the European Union has concluded dedicated co-operation agreements with the US, Japan, Korea and Switzerland. The most advanced agreement is the one with Switzerland, which already contains provisions on the exchange of evidence, and the proposed update would bring the agreement with Canada to the same level as the one concluded with Switzerland.

I am sure that noble Lords will agree that the ability to share information for effective and efficient international competition enforcement is increasingly important. Access to information from other jurisdictions can be important in reaching a robust enforcement decision. Co-operation and information-sharing between jurisdictions can help ensure that enforcement bodies do not reach different decisions based on different sets of information.

The agreement contains general safeguards for the transfer of information and additional safeguards for the transfer of personal data. Personal data can be shared only with the express written consent of the person or company to which it relates. In the absence of consent, personal data can be shared only where both competition authorities are investigating the same related conduct or transaction. Furthermore, the transfer of personal data will be subject to independent oversight.

The agreement also contains safeguards for information provided by a company under the EU cartel immunity or leniency programme. This information cannot be shared without the express written consent of the individual or company that provided that information.

As I have noted, there are no financial implications for the UK from these decisions. I confirm that I do not consider that any of the Bill’s provisions engage the rights set out in the European Convention on Human Rights, so no issues arise about the Bill’s compatibility with those rights. It is intended that the Bill will come into force on the day of Royal Assent. For the reasons I have outlined, I commend the Bill to the House. I beg to move.

--- Later in debate ---

[Lord Prior of Brampton]

I thank the noble Baroness, Lady Ludford, and the noble Lord, Lord Mendelsohn, for their broad support for the Bill. I suspect that the noble Baroness knows more about the history of those treaties than I do. I do not know why we require primary legislation: she may have a better guess than I do. But I am glad that she agrees with the substance of the Bill, at any rate. I note the ironies to which she referred in her speech. I more than note them, but I will resist the temptation to respond to them, if she does not mind.

Both the noble Baroness and the noble Lord raised issues about the Competition and Markets Authority post Brexit. The CMA is not a party to the agreement, so the agreement cannot simply be transitioned without amendment. Any future competition co-operation between the UK and Canada will have to be negotiated and agreed with the Government of Canada, and I suspect that the same has to be true about the relationship between the CMA and the EU post Brexit. That will have to be part of the negotiation. I of course entirely agree with the noble Lord that that will have to be negotiated during the transition period so that there is no cliff edge in that respect.

As far as data is concerned, the agreement contains general safeguards for the transfer of information and additional safeguards for the transfer of personal data. Personal data can be shared only with the express written consent of the person or company to whom it relates. I hope that that is enough on data for the noble Baroness today. If she would like me to write to her in more detail, she can let me know and I will do so, but I hope I have given her enough reassurance in that regard.

I think I have responded to the points raised by both the noble Lord and the noble Baroness. On that basis, I commend the Bill to your Lordships and ask that it has a Second Reading.

[The Earl of Sandwich (CB)]

My Lords, I apologise for not intervening earlier, but I have a very brief question. The country called Kosovo is very dear in our hearts. It is situated between Albania and Serbia. Has the Minister’s department or the Foreign Office conducted any impact assessment? There will inevitably be consequences for Kosovo, which has a special status, as the noble Lord knows, because it is not fully recognised by all members of the European Union.

[Lord Prior of Brampton]

I cannot answer that question today; I will write to the noble Earl. Is the question about the impact on Kosovo of Albania and Serbia joining the EU at some future point?

[The Earl of Sandwich]

Particularly the impact of this legislation.

[Lord Prior of Brampton]

I will write to the noble Earl.

The noble Lord, Lord Mendelsohn, asked what our view would be if, between now and our leaving the EU, perhaps during the transition period, the EU decided it wanted to expand to cover, for example, Serbia, Albania and other countries. I think that our response is that we would not want to stand in the EU’s way in such circumstances. I am sure that if it wanted to go ahead, it would be curmudgeonly for us to stand in its way.

Bill read a second time and committed to a Committee of the Whole House.