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Session 2000-01
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Vehicles (Crime) Bill


 

These notes refer to the Vehicles (Crime) Bill
as introduced in the House of Commons on 7th December 2000 [Bill 1]

VEHICLES (CRIME) BILL

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EXPLANATORY NOTES

INTRODUCTION

These explanatory notes relate to the Vehicles (Crime) Bill as introduced in the House of Commons on 7 December 2000. They have been prepared by the Home Office in order to assist the reader of the Bill and to help inform debate on it. They do not form part of the Bill and have not been endorsed by Parliament.

2.     The notes need to be read in conjunction with the Bill. They are not, and are not meant to be, a comprehensive description of the Bill. So where a clause or part of a clause does not seem to require any explanation or comment, none is given.

SUMMARY

3.     The Bill is in four parts:

Part I, Regulation of Motor Salvage Operators: introduces powers to regulate the motor salvage industry and require motor salvage operators to register with local authorities, keep records and for the police to have right of entry to registered premises without warrant.

Part II, Regulation of Registration Plate Suppliers: introduces powers to control the supply and issue of number plates. It requires number plate suppliers to register, to make suitable checks before selling a number plate and to keep records of transactions.

Part III, Other Provisions Relating to Vehicle Crime: This Part:

  • enables a vehicle which has been written off to be required to have an identity check if the Driver and Vehicle Licence Agency (DVLA) receives a request for it to be allowed back on the road. This will prevent the identity of stolen vehicles being disguised by that of other, legitimate, vehicles. It also provides a power to prescribe the form and manner in which information on number plates must appear;

  • amends the Scrap Metal Dealers Act 1964 so as to enable scrap metal dealers disposing of motor vehicles to be obliged to notify the destruction to such persons as are specified (the main intended recipient of the notification being the DVLA);

  • includes a provision to allow the police bulk access to a motor insurance industry database which will allow them to identify more easily uninsured drivers;

  • includes a provision extending the time limit for bringing prosecutions for the offence of taking a mechanically propelled vehicle without authority. This enables proceedings for summary offences to be commenced (subject to a general time limit of three years) at any time within six months from the date on which sufficient evidence came to the knowledge of the prosecutor; and

  • allows certain magistrates' courts' receipts to be re-circulated to pay for speed and red light camera enforcement.

Part IV, Supplementary: this Part has a number of standard provisions relating to financial arrangements, consequential amendments and orders and regulations as a result of the Bill.

THE BILL

Explanatory Notes for the Vehicles (Crime) Bill

4.     The explanatory notes are divided into parts reflecting the structure of the Bill. The background and summary of each subject area are detailed, followed by the commentary on clauses in number order.

SUMMARY AND BACKGROUND

Part I:     The Motor Salvage Industry

5.     A consultation paper with proposals to regulate the salvage industry was issued on 27 April 2000. The consultation paper put forward three options:

  • to rely on present controls, which are limited as the motor salvage and dismantling industry is only regulated for environmental purposes;

  • to apply a voluntary Code of Practice across the entire motor salvage industry; this has been developed by the insurance industry and is aimed at the responsible disposal of those vehicles written-off by insurers;

  • to introduce statutory regulation.

6.     Twenty-six organisations replied to the consultation document. Of these twenty-two endorsed the proposal for statutory regulation. As a result of the consultation the Home Secretary decided that statutory regulation was the preferred way forward.

7.     Its purpose is to bring the motor salvage industry within a framework of statutory regulation so as to reduce the opportunity for disposing of stolen vehicles. Within the salvage industry there are opportunities:

  • to give the identity of legitimate vehicles which have been seriously damaged or written-off to stolen vehicles (a process known as "ringing");

  • for stolen vehicles to be broken up into their component parts which are then re-used to repair other vehicles or sold into the market for second hand spares;

  • for vehicles to be disposed of and then fraudulently reported as stolen to insurance companies.

8.     The scale of this problem can only be estimated. However, official statistics (Criminal Statistics: England and Wales, 1997) indicate that about 70% of stolen vehicles are recovered. The problem is measured by those vehicles which are not recovered. The Motor Salvage Regulation Task Force of the Home Office Vehicle Crime Reduction Action Team estimates that 25% of these non-recovered vehicles are used for "ringing" and 40% are broken for their parts. In addition, a further 20% are thought to be the subject of insurance fraud.

9.     Therefore, up to 78,000 vehicles every year are likely to have been used for "ringing" or broken up for parts. To this figure can be added a proportion of insurance frauds, estimated at up to 12,000 vehicles.

10.     By regulating this industry it is believed that about 30,000 vehicle thefts and 6,000 fraudulent insurance claims could be avoided per year.

Part II: Regulation of Registration Plate Suppliers

11.     The main objective of this Part of the Bill is to regulate the supply of number plates in order to combat vehicle "ringing" and vehicle cloning (using the identity of an existing vehicle to disguise another).

12.     Many criminals using vehicles to carry out criminal activity use false plates to avoid detection. Such activity can range from terrorism, the use of getaway cars by armed robbers to burglars using vehicles to transport stolen goods.

13.     At present there is no control over the supply of plates and suppliers are not required before supplying a set of plates to check the identity of purchasers or their entitlement to use plates containing particular registration marks. The objective of this Part is to ensure that plates are issued only to those with a genuine reason for having the plates and that they are issued for the correct vehicle.

14.     This Part provides for the registration of persons carrying on the business of a number plate supplier; the charging of a registration fee; a power by which the Court may suspend registrations of persons contravening this Part; and a power to prosecute for contravention of the statutory requirements. It also allows the Secretary of State to remove from the register persons whom he believes to have ceased trading.

15.     It also creates three new offences; that of selling plates which purport to be registration plates but are not, of knowingly supplying plates to a person who is in the business of selling fake registration plates, and of knowingly supplying components or plates to an unregistered person.

Part III: Other Provisions Relating to Vehicle Crime

16.     The incentives for criminals arise if they can obtain a low-value accident-damaged or scrapped vehicle (salvage) and subsequently sell a similar stolen vehicle to an unsuspecting purchaser at a much higher price. One of the main objectives of this Part of the Bill is to make it harder for such criminals to obtain new registration documents for "rung" vehicles. Additionally, this Part provides enabling powers for the introduction of vehicle identification features on number plates. This will link number plates to the vehicles to which they have been assigned, thereby making it more difficult to switch plates between vehicles. It will also make plates more secure and more difficult to duplicate for illegal purposes.

17.     Swapping vehicle identity involves transferring vehicle-specific identification plates from the damaged vehicle to the stolen vehicle - and the introduction of vehicle identity tests is intended to detect and deter this crime (and, in turn, vehicle ringing).

18.     One of the key issues to the successful implementation of vehicle identity tests is the mechanism for ensuring that vehicles are submitted for test. This will be achieved as a result of a combination of factors:

  • the destruction of the registration document for salvage vehicles (which is something that is already provided for under a Code of Practice which applies where a vehicle insurer makes a 'total loss' payment to a policyholder);

  • making it compulsory for a vendor to transfer the vehicle registration document to the new keeper of a vehicle (which will be achieved by making a minor change to secondary legislation);

  • making it a requirement for motorists to produce either their vehicle excise licence renewal notice or registration document in order to re-licence their vehicle (thereby making it harder for criminals to 'legitimise' a ringed vehicle);

  • introducing a requirement for the identity of a 'salvage' vehicle to be checked before a replacement registration document is issued to a new keeper.

19.     The risk of "ringing" affects a wide range of vehicles. Consequently, although the initial objective is to apply the requirement for vehicle identity tests to higher value, more recently registered, vehicle salvage, the requirement could also be extended to other vehicle classes.

20.     This Part of Bill also requires scrap metal dealers to notify the Secretary of State when a motor vehicle is destroyed. This will help to prevent stolen cars being issued with new registration documents by the DVLA, as the DVLA will have been notified of the original car's destruction.

21.     Under section 127 of the Magistrates' Courts Act 1980, magistrates' courts cannot try a summary offence unless proceedings are started within six months of the day when the offence was committed. The commencement of proceedings for taking a mechanically propelled vehicle without authority is covered by this time limit. Advances in forensic science (particularly fingerprints and DNA) mean that it is possible reliably to match an offender with a crime after the prosecution time limit has expired. This Part of the Bill aims to extend the time limit. This will mean that proceedings, relating to the unauthorised taking of a vehicle, can be commenced at any time within six months from the date on which sufficient evidence came to the knowledge of the prosecutor, subject to a general time limit of three years from the day the offence was committed.

22.     Finally, this Part of the Bill allows the Lord Chancellor's Department to re-circulate money received from speed and red light camera enforcement to fund certain costs relating to speed cameras and it gives the police bulk access to a motor insurance industry database which will allow them to identify more easily people driving without insurance.

Part IV: Supplementary

23.     This Part of the Bill has a number of standard provisions relating to financial arrangements, consequential amendments and orders and regulations as a result of the Bill.

COMMENTARY ON CLAUSES

Part I: The Motor Salvage Industry

Clauses 1, 2, 3, 4, 5, 6 and 12: Registration

24.     The intention of these clauses is to require the motor salvage industry to register with the local authority. A person, including a body corporate, who carries on a business in the motor salvage industry will be required to register with the local authority. Local authorities will be responsible for maintaining registers, which will contain details to be prescribed. Such details will include the name of the person and the address of the premises where the business is conducted. A fee will be paid to the local authority on applying for registration, with the local authority being responsible for determining that fee, based on the recovery of the costs of administrating the registration scheme. Registration will lapse after three years, although it can be renewed.

25.     The registration authority will have the discretion to decide whether a person is "fit and proper" to carry on business in the motor salvage industry. If it decides that the person is not "fit and proper", it can refuse or cancel registration. If registration is refused or cancelled on this ground, the local authority need not consider a further application for registration from the applicant for a period of three years. If a local authority decides that a director, or any other person responsible for the control and management of a body corporate or a limited liability partnership is not "fit and proper", it can refuse or cancel the registration, or refuse to renew the registration, of that body corporate or limited liability partnership.

26.     A person is entitled to make representations to the local authority where that local authority is minded to refuse an application for registration or the renewal of a registration, or where the local authority is minded to cancel a registration. If the local authority proceeds with the refusal or cancellation, the person may appeal to the magistrates' court.

Clauses 7 and 8: Keeping of Records etc.

27.     Any registered motor salvage operator must maintain records to be specified in regulations. Regulations will require records to be kept of all vehicles entering the motor salvage industry, and such records will need to be kept for three years. Further, registered motor salvage operators will be obliged to notify the destruction of any vehicles to such persons as are specified (the main intended recipient of the notification being the DVLA).

28.     If a person does not maintain appropriate records or make these notifications, this will be an offence and they will be liable on summary conviction to a fine.

Clauses 9, 10 and 11: Supplementary Provisions and Offences

29.     Clause 9 gives the police powers of entry to registered premises without warrant. For entry to unregistered premises, or entry to registered premises where entry has previously been refused, a warrant issued by a justice of the peace can be obtained to secure entry with the use of force if necessary.

30.     A police constable may inspect any motor vehicles or salvaged parts kept at the premises and inspect or copy any records which the motor salvage operator is required to keep.

31.     Clause 10 requires the person registered or applying to be registered to notify the local authority of any changes affecting the accuracy of information provided, within 28 days of the change taking place. Failure to do so will be an offence, although there is a due diligence defence.

32.     Clause 11 makes it an offence for a person to give a false name or address when selling a motor vehicle to a motor salvage operator.

Clauses 13, 14 and 15: General

33.     Clause 13 provides for the police or local authorities to bring prosecutions. Prosecutions by anyone else must have the consent of the Attorney General. Clause 14 allows the Secretary of State to amend or repeal any private or local Act if it appears to conflict with this Act.

34.     Clause 15 defines the terms used in this Part of the Bill including what constitutes carrying on a business as a motor salvage operator in the area of a local authority and a motor salvage yard.

Part II: Regulation of Registration Plate Suppliers

Clauses 16,17, 18, 19, 20, 21 and 22: Requirement of registration of registration plate suppliers

35.     Clause 16 requires any person who carries on a business as a registration (number) plate supplier in England or Wales to be registered by the Secretary of State. It would be an offence to conduct business as a registration plate supplier without being registered.

36.     Clause 17 requires the Secretary of State (in practice the DVLA) to establish and maintain a register of registration plate suppliers containing particulars to be prescribed by regulation. The Secretary of State may disclose information from the register and may charge a fee for such disclosure.

37.     Clause 18 provides for applications for registration and empowers the Secretary of State to charge a fee to recover reasonable costs.

38.     Clauses 19 to 22 provide for the suspension of a registration by a court where a person has been convicted of an offence under this Part and for the cancellation of a registration where the Secretary of State is satisfied that business as a registration plate supplier has ceased for a period of at least 28 days. A registration plate supplier can appeal, within 21 days, against a decision by the Secretary of State to cancel their registration.

Clauses 23 and 24: Keeping of Records etc.

39.     Clause 23 enables the making of regulations to provide for the keeping of records by registration plate suppliers. It will be an offence to fail to keep records in the prescribed manner, subject to a due diligence defence.

40.     Clause 24 requires registration plate suppliers to obtain prescribed information from prospective purchasers. It will be an offence to fail to obtain this information before completing a sale, subject to a due diligence defence.

Clauses 25, 26, 27 and 28: Supplementary Provisions and Offences

41.     Clause 25 provides the right of entry and inspection for a police officer or a person appointed by a local authority at the premises of a registered business. A police officer or a person appointed by a local authority may enter the premises of an unregistered business provided that a justice of the peace has issued a warrant. Reasonable force may be used in pursuance of the warrant.

42.     Clause 26 requires a registered person to provide notification of any changes to details held on the register and notification of the cessation of business as a registration plate supplier within 28 days. Failure to do so will be an offence, subject to a due diligence defence. Clause 27 makes it an offence to sell plates which purport to be registration plates but are not, or to knowingly supply plates to a person who is in the business of selling fake registration plates.

43.     Clause 28 makes it an offence to supply a plate to an unregistered person who is carrying on business as a registration plate supplier.

Clauses 29 and 30

44.     The police or local authorities may bring prosecutions. Prosecutions by anyone else must have the consent of the Attorney General. Prosecutions may be brought against corporate bodies and against senior employees of those bodies. Clause 30 defines the terms used in this Part of the Bill, including the terms "carrying on a business as a registration plate supplier" and "registration plate".

Part III: Other Provisions Relating to Vehicle Crime

Clause 31: Vehicle Licence Applications

45.     Clause 31 amends section 7 of the Vehicle Excise and Registration Act 1994 to enable the Secretary of State to specify documents and other evidence which must be produced in support of a vehicle excise licence application. Corresponding amendments are also made to section 22 of the 1994 Act in relation to nil licences.

Clause 32: Vehicle Identity Checks

46.     The main intention of this clause is to require a compulsory vehicle identity check of any 'written-off', scrapped vehicle, prior to the issue of replacement registration documents to the vehicle keeper.

47.     The purpose of the vehicle identity check is to help prevent a criminal from swapping the identity of a vehicle he has stolen with that of a written-off or scrapped vehicle ("ringing").

48.     Clause 32 inserts new regulation-making powers after section 22 of the Vehicle Excise and Registration Act 1994 (registration regulations). They ensure that the Secretary of State:

  • can refuse to issue a registration document in respect of a vehicle if he is not satisfied that the vehicle is the registered vehicle; and

  • can make regulations to provide for the examination of vehicles for the purpose of ascertaining whether they are the registered vehicles.

49.     Clause 32 also ensures that the vehicle identity check regime can apply to the issue of new registration documents in place of surrendered documents.

Clause 33: Registration Plates

50.     This clause provides for the inclusion of additional information to be held on registration plates. It provides a power to make regulations to prescribe the form and manner in which such information may be held. The purpose of this provision is to enable the Secretary of State to prescribe that registration plates should contain information that would link the registration plate to the vehicle for which it is intended.

Clauses 34 and 35: Information Requirements

51.     Clause 34 enables regulations to be made obliging scrap metal dealers registered under the Scrap Metal Dealers Act 1964 to notify specified persons if they finally dispose of a motor vehicle. The intention is to ensure that the DVLA are notified of such destructions, with the aim of preventing the re-registration of a stolen motor vehicle which has been given the destroyed motor vehicle's identity. The provision mirrors the provision in clause 8 applying to registered motor salvage operators.

52.     Clause 35 enables the police to have bulk access to an insurance industry database which will help them to detect people driving without insurance.

Clauses 36 and 37: Miscellaneous

53.     Clause 36 amends the Theft Act 1968 to introduce a time limit that enables proceedings relating to the unauthorised taking of a mechanically propelled vehicle to be commenced at any time within six months from the date on which sufficient evidence came to the knowledge of the prosecutor. It is subject to a general time limit to bring a prosecution within three years of the offence taking place.

54.     Clause 37 deals with the funding of certain costs of magistrates' courts, in relation to the administration of speed and traffic camera cases. In order to enable the Lord Chancellor to meet the full cost of those cases, it introduces a new section 59F to the Justices of the Peace Act 1997. The new provisions will allow the Lord Chancellor to make payments to meet the full costs to the magistrates' courts, through their paying authorities. The clause introduces the power to make payments according to conditions that will be determined by him with the approval of HM Treasury.

Part IV: Supplementary

Clauses 38, 39, 40, 41, and 42: General

55.     Clause 38 - if an offence under this Bill, committed by a body corporate, is proved to have been committed with the consent of, or is attributed to, a director, manager, secretary or other relevant officer, this person may be prosecuted, as well as the body corporate.

56.     Clause 39 relates to the service of documents required or authorised by the Bill, and enables documents to be served by electronic means where appropriate. Clause 40 states that any order making powers or regulations as a result of this Bill will be exercisable by statutory instrument. All statutory instruments made under the Bill apart from commencement orders are to be subject to the negative resolution procedure.

57.     Clause 41 ensures that sums received by a Minister of the Crown in consequence of the Bill are paid into the Consolidated Fund. Clause 42 refers to the Schedule attached to the Bill which lists the consequential amendments to other Acts as a result of this Bill.

Clauses 43, 44, and 45: Final

58.     The substantive provisions of this Bill will come into effect when it is decided appropriate by the Secretary of State who will issue a commencement order. Different dates might be considered appropriate for different parts of the Bill or in respect of different geographical areas.

59.     Parts I, II, and clauses 34 to 37 inclusive extend to England and Wales only. Clauses 31 to 33 inclusive extend to England and Wales, Scotland and Northern Ireland.

Schedule

60.     The Schedule provides details of the consequential amendments to other legislation as a result of this Bill.

FINANCIAL EFFECTS OF THE BILL

61.     The figures set out below depend on a range of assumptions, many of which cannot be easily quantified. For these reasons they are estimates only. All figures are full year figures at current prices unless otherwise indicated. Costs for Government Departments arising from the Bill will be met from Departmental Expenditure Limits. The total cost of the Bill to business is estimated to be in the range of £13-20 million in the first year and £11-18 million annually thereafter.

Part 1: The Motor Salvage Industry

62.     The estimated total registration cost to the industry sector is £65,000 in the first year and thereafter at three-yearly intervals. This assumes that about 3,000 companies are likely to be required to register as a result of the legislation.

63.     The cost to the motor salvage industry of checking the identity of vehicles and recording the details is estimated at a maximum of £285,000 per annum. This assumes:

  • that the small end of the industry, which is not likely to be complying with the existing voluntary Code of Practice, processes only 20% (340,000) of end-of-life vehicles;

  • that it takes small companies about 57,000 hours to apply the prescribed procedures to these vehicles based on an average of 10 minutes per vehicle; and

  • a rate of £5 per hour.

The cost of assisting with enquiries is estimated to be no more than £110,000 per annum.

64.     Non-recurring costs are estimated to be up to £115,000. This makes allowance for:

  • small businesses not already familiar with the voluntary Code of Practice to understand the new requirements (the estimated cost of "familiarisation" is £58,000, based on an average of 2 hours at £10 per hour for up to 2900 businesses); and

  • the cost of producing Notifications of Destruction (estimated at up to £57,000).

65.     Enforcement would be the sole responsibility of the police. As this would form part of their routine investigations they would absorb the cost, which the Association of Chief Police Officers (ACPO) estimates at around £110,000 per annum. The annual cost of additional prosecutions to the Lord Chancellor's Department (including legal aid cost) would be £16,612, assuming 20 prosecutions per annum, and £45,000, assuming 150 appeals per annum: a total of £61,612. The annual cost to the Crown Prosecution Service would be £9,555, assuming 50 prosecutions per annum.

 
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Prepared: 7 December 2000