Football Governance Bill [HL]

Lord Scriven Excerpts

Committee stage
Wednesday 18th December 2024 Lords Chamber

[Baroness Butler-Sloss (CB)]

Section 56 says that it is utterly wrong to have companies that make money by exploiting people down the chain—consequently, it is wrong. But, for reasons I do not know but can guess, the last Government, who put in place this very good bit of legislation, presumably did not want to offend businesses. I understand that there are problems in making it mandatory but, if somebody is making money that they are going to put into a football club by exploiting other people down the chain, that is something we should not want our clubs to be involved in.

[Lord Scriven (LD)]

My Lords, I was unable to join your Lordships at Second Reading and have decided to add my name, and speak, only to amendments on areas where I have relevant knowledge. I speak as somebody who has for a number of years been a co-chair of the All-Party Parliamentary Group on Democracy and Human Rights in the Gulf, and also led the first ever debate on sportswashing in your Lordships’ House in March of this year. Therefore, I will speak in favour of the amendments I have added my name to—Amendment 185 and in particular Amendment 193 from my noble friend Lord McNally, who cannot be here in his place today. I also strongly support Amendment 200 on state entities.

It is interesting listening to the noble Lord, Lord Jackson of Peterborough, and other noble Lords talk about human rights and the Human Rights Act. Let us be clear. What the regulator will be doing here is having a statutory responsibility for ensuring that a takeover of a club takes into consideration human rights issues. Under the Human Rights Act an individual can bring a case based on their feeling that their human rights have been undermined. If you are in Saudi Arabia, Qatar or the UAE, you cannot bring that case as an individual whose human rights have been undermined, particularly when it comes to a state entity potentially taking over a football club. That is what these amendments are about. Rather than just financial issues, when it comes to a takeover of a club, as a statutory point of principle human rights should be looked at by the regulator independently to decide whether a potential director is a fit and proper person to be able to take over and manage an English football club. That is what this debate is about.

It is interesting that certain issues in the Bill are specific, such as money laundering, so the Government have accepted that the regulator can look at specific issues. These amendments ask that another area specified in the Bill should be human rights abuses carried out not just in the UK but elsewhere in the world, particularly when it is a state entity or an individual linked to a state entity. The reason why this is important is that the concept of sportswashing, where sports clubs are bought particularly to try to influence soft power, is really taking hold. The previous Government understood that when it came to taking over media in this country. There was an issue to do with how state-entity organisations, including their potential human rights abuses, actually stopped takeover of the media.

I am sure that the Minister, when it comes to arguing the Government’s case if they are not minded to do this, will look at the Global Human Rights Sanctions Regulations 2020 as the cloak of respectability, where the powers already exist for this to be looked at. Well, let us be clear. These were introduced with the aim of holding individuals and entities accountable for human rights abuses. However, these regulations are not proving efficient in stopping foreign Government entities from owning Premier League clubs, or any league club. The Newcastle deal, where the Saudi Public Investment Fund took over Newcastle, happened 15 months after these regulations came into force.

These regulations target individuals and specific entities, not entire Governments or sovereign wealth funds. This is a critical loophole which we can see in the case of Saudi Arabia’s Public Investment Fund, which now owns Newcastle United and operates a state-controlled entity that presents itself as independent of government. As a result, it evades direct scrutiny under the sanctions framework. There is also a lack of transparency with these regulations, because decisions about who we sanction are not clear and are at the whim of an individual Minister. That is why I believe there should be the provisions in the Bill laid down in Amendment 200 and the other amendments which I put my name to.

The Global Human Rights Sanctions Regulations lack the reach and enforcement power to prevent foreign state entities linked to human rights abuses owning English Premier League clubs. That is why these amendments are required. Otherwise, I believe that our national game, football, will potentially remain a platform for authoritarian regimes or individuals who have committed human rights abuses and will be used as a sportswashing exercise that will tarnish their own reputations and image and not defend our national game.

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[Lord Pannick (CB)]

My Lords, I think a very strong case has been made this afternoon by the noble Lords, Lord Bassam and Lord Scriven, the noble and learned Baroness, Lady Butler-Sloss, and my noble friend Lady Grey-Thompson to require the regulator to assess whether a prospective owner of a football club respects and promotes the protection of human rights and prevents modern slavery.

I am very sympathetic to the principle. I am just concerned about the practicality. Is it really practical to expect that the regulator is going to have the expertise, time or ability to conduct a general assessment of whether a particular person—who may, for all I know, be based abroad—is generally respecting human rights and preventing modern slavery? This is going to take an enormous amount of time and money, and I fear that it would distract the regulator from the more day-to-day, prosaic functions that Parliament will be asking it to perform. I would be pleased to hear from the noble Lord, Lord Bassam, how this is going to work in practice, because I am very sceptical.

[Lord Scriven (LD)]

Does the noble Lord accept that it already takes place for certain individuals and entities with regard to the regulations that I pointed out, and that the Government already have a system in place to do this for takeovers? The issue is that there are gaps, which is why it needs to be in this Bill, particularly around football and state entities.

[Lord Pannick (CB)]

I entirely accept that there are detailed regulations, in particular in relation to money laundering, but that is a far more specific area, where there is a government system and a whole army of people with expertise to assess those matters. The question is whether we wish to make it a function of the independent football regulator to have a whole department that is concerned with this. I see the force of the principle, but I remain sceptical about it in practice.

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[Lord Scriven (LD)]

There is a specific issue with the Gulf states. If people are potentially put to death for being gay in a state, would that debar a state entity or an individual in that Government from owning an English club? It is a clear question.

[Baroness Twycross (Lab)]

I am going to come on to state ownership later in my speech, if the noble Lord would be happy to wait.

[Lord Scriven (LD)]

No, I would like an answer to this specific question, because the Minister gave a specific commitment with regard to what is in the Bill. I put a specific question based on what could happen, and on the laws of the land of a Gulf state. I wish to know: if that takes place, would someone who is related to that state through a state entity not be able to own a Premier League club in this country?

[Baroness Twycross (Lab)]

I would be grateful if the noble Lord allowed me to take away that specific example. I will write to him and to the Committee and place a letter in the Library, so that they have a detailed response on that point.

These are all issues that the regulator will take very seriously. Where the amendments before us today go further than existing drafting, this introduces elements that we do not believe are necessarily relevant to an owner’s suitability. They would require the regulator to make a subjective and potentially speculative judgment on whether the individual has engaged in any activity that would risk bringing the game into disrepute. Where a potential dispute relates to things like criminal history, the regulator will already have to consider these things. But “disrepute” is a vague term; could it arise through an owner’s conduct in their personal life, or their political views? In the Government’s view, it would put the regulator in quite a difficult position, making a value judgment on what constitutes disrepute, which would undermine the principle of a reasoned, evidence-based test.

Turning to Amendment 199 in the name of the noble Baroness, Lady Grey-Thompson, the test is supported by the regulator’s information-gathering powers to ensure its determination is evidence-based. These powers will help the regulator tackle unco-operative individuals or organisations that do not provide the information. However, let me be clear: if the regulator does not have enough evidence to make its determination, the individual will be found unsuitable.

I understand the noble Baroness’s concerns about restrictions on an owner’s funds. I want to reassure her that the test requires an owner to submit financial plans and demonstrate sufficient financial resources to run the club. As part of this, we expect that the regulator will consider things such as the liquidity of those resources and their availability to actually be used to fund the club. The regulator will also need to be satisfied that the owner does not have wealth connected to illicit finance. To do this, it can conduct enhanced due diligence on the owner’s source of wealth. This would identify any links to criminality, corruption and money-laundering. We believe, therefore, that the intent of the noble Baroness’s amendment is delivered in the current drafting of the Bill. I hope she takes reassurance from this, but I am happy to meet her to discuss this if my explanation has not satisfied her.

I turn to amendment 200 from my noble friend Lord Bassam of Brighton, which the noble Lord, Lord Moynihan, also spoke to. This Government are not making a judgment on different forms of ownership. We recognise that good ownership can take many forms, and it is investment from responsible owners that has been a driving factor in the success of English football. Banning any one particular kind of ownership would not, in our view, be in keeping with the flexible and proportionate approach to regulation we are proposing. I believe that this approach has broad support across the Committee. Prospective owners with state backing will be assessed against the same set of criteria as any other prospective owner, on a case-by-case basis. I hope that answers the question about Newcastle from the noble Lord, Lord Parkinson.