Enterprise Bill

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Mr. Waterson: It was certainly not the OFT. When I mentioned the case earlier, I referred to the Serious Fraud Office. I am simply reflecting that one public body might behave like another in the same circumstances. An investigative body with wide powers and a large budget and staff might be tempted to behave in that fashion. I concede that I was talking about a different body–we have not even set up the OFT yet–but in the case to which I referred a great deal of information seemed to be in the public domain early on without any criminal charges being levelled. I hope that the Under-Secretary and other members of the Committee agree that that was an unhelpful way to proceed. In any event, we are adamant in pressing for tight restrictions on disclosure of information to people who have no business receiving it.

Mr. Djanogly: Clearly, the fact that the Serious Fraud Office was involved is relevant because it is highly likely that it will be used again in future when an OFT investigation is under way. It would not be the first time that an investigation had been botched. The arrest of the Maxwells springs to mind–an appalling release leaked to the press prejudiced the trial in that case.

Mr. Waterson: My hon. Friend provides a good example from the recent past. I have no doubt that the Serious Fraud Office will become involved in some of the same matters as the OFT. If the Under-Secretary believes that I am wrong, she will no doubt intervene to say so. The concern is legitimate: it is not just ours, but that of the CBI and other business organisations that appreciate the need not only for annual reports, but for making information about the OFT available in the public domain. I shall not labour the point, but as I explained earlier, that would be helpful. We need to see what pattern emerges as the OFT discharges its functions. No one disagrees about that, but we must ensure that sensitive information does not leak out and unfairly cause commercial harm to any of the bodies or companies involved. That is the rationale behind the amendments. I hope that they will fare better than the last group.

Dr. Cable: I want to ask some questions–not loaded questions–because I do not entirely understand the purpose of the amendment or, indeed, the clause that precipitated it. The hon. Member for Eastbourne made sensible remarks about the disclosure of confidential information, but the part of the Bill to which he and the CBI have taken exception does not relate to confidential information. It refers us to subsequent clauses and the exclusion of

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    ''the affairs of the particular person''.

It then goes on to talk of disclosure of information affecting

    ''the interests of that person''.

Why is it a problem to relate to particular individuals in this context? Let me take one or two provocative examples. Let us imagine hypothetically that Mr. Berlusconi decided to diversify out of Italy–he is doing so in any case–and bought into British commercial radio or local newspapers. A competition reference would, as I understand it, have to take place in terms of the companies that are vehicles for him as an individual. Why would there be a problem about talking about that individual? He is the issue.

5.30 pm

Let me take another case. Enron has effectively departed this world, but if it were still a going concern and making bids for British energy companies, why would there be a problem in the OFT publicly discussing the behaviour of Mr. Skilling? He was not the owner but the chief executive, with many interests and options; it was his operations in the company that presented the problem. Why should reference to a particular individual be highly sensitive? I do not understand.

Miss Johnson: Perhaps I may help the hon. Gentleman and save him from listing many examples. Under the Interpretation Act 1978, ''a person'' includes companies, so the word ''person'' does not relate only to individuals.

Dr. Cable: I thank the Under-Secretary.

Mr. Ken Purchase (Wolverhampton, North-East): May I make a general point? There is a case for saying that newspapers should not publish the name of anyone who has been charged or is on trial until they have been proved guilty. It is not a strong case and would be part of a slippery slope towards the public never knowing the details. In cases in which there is a general rule of non-disclosure to the press, public or any written report, we may find that the nature of the offence being investigated and the previous record of the person involved are both so serious that a disclosure should be made in the public interest. I will not quote particular cases, but the world of business has not been without rogues and confidence tricksters operating and proving a considerable danger to the general public.

Mr. Waterson: I am listening intently to the hon. Gentleman's thoughtful contribution. There are two arguments. First, it may be right to prevent the disclosure of people's names when there has been no charge, let alone a conviction. Secondly, as my hon. Friend the Member for Huntingdon mentioned, it may be sensible to prevent such disclosure because the publicity may prejudice an investigation or, more seriously, a subsequent prosecution.

Mr. Purchase: That is absolutely correct, but the Bill includes a discretion, which the hon. Gentleman argued against. I am arguing in favour of the discretion because it is important for a judgment to be used at the time on whether to publish. We must look for responsible decision making on that, but on

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the point of principle, to close off any possibility of protecting the public by disclosure would be wrong and would weaken the purpose of the Bill, which is essentially about consumer protection. In debating the first measure this morning, the hon. Gentleman referred to the importance that his party placed on consumer protection and so I assume that we are as one on this matter.

Mr. Waterson: The clause deals with the annual report of the OFT, so it does not touch on the outcome of any individual case or investigation. If a major investigation concluded that there had been breaches, I assume that there would be any amount of reference to the facts of the case and the people involved. We are debating merely what should be contained in the annual report, which by definition is produced at a fixed point each year, and not at the end of an investigation into one particular company.

Mr. Djanogly: Of course, the vast majority of cases will be civil, not criminal. A civil penalty may be involved where a company, or part of its business, has been deemed on balance to be anti-competitive. In such a case, the company will have good reason to want to protect the rest of its business.

Mr. Purchase: I agree. My experience of long-term ownership of businesses is that, by and large, people are honest and try to conduct their business according to the rules of the game. However, we are talking about the discretion or the right for a business to be named if the need arises. That discretion will be exercised properly and it need not hold any horrors for us at this stage. I urge the Under-Secretary to reject the amendments.

Mr. Djanogly: I want to deal with a particular point before I go on to other issues. Amendments Nos. 11 and 7 relate to the key issue of the word ''opinion''. The test should be as objective as possible, rather than subjective. There are many ways of looking at that. It seems to be assumed that the OFT will know everything about a company while it conducts its investigation. However, in the vast majority of cases it will not. The OFT will find out about only a small part of the company–a product that it is selling, for example–which it is investigating. The OFT may not know that by releasing certain information, it will damage another part of that company's business. The release of a particular piece of information may have a negative impact on a different product that the company is preparing.

Mr. Purchase: We all agree that a disclosure is a serious matter. Does not the hon. Gentleman accept that in the event of a disclosure, extensive inquiries would have been made and the company or individual consulted beforehand about the need to publicise their name? We should give credit to those who conduct the investigation.

Mr. Djanogly: The hon. Gentleman makes a good point that I was about to deal with. That is what should happen, but the legislation does not provide for that. The opinion of the OFT may become irrelevant to the damaging effect of the release of the information. As the hon. Gentleman mentioned, there should be a mechanism whereby the proposed

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release of the information to the public is notified to the company in advance, so that it has the opportunity to appeal. There may be circumstances in which a decision against the commercial interests of the company and the public must be debated, and there should be a forum to do that.

The wider issues also relate to the release of information.

Mr. McWalter: Before the hon. Gentleman leaves that point, does he not agree that it is most unlikely that that sort of information would be released where a company co-operated fully with an OFT investigation? It should be necessary to protect consumers and other businesses from a company's actions only where it is clearly obstructing the investigation or being unco-operative.

Mr. Djanogly: I should like to think that the hon. Gentleman is right, but we have to consider where trials by media often emanate from, for instance. Leaks happen and companies are right to be concerned about their possible implications. It would be helpful if the Under-Secretary could clarify what rights other people or other companies have to request company information held by the OFT in either published or unpublished form. I appreciate that several other pieces of legislation are probably involved, but I should be grateful if she could help me on that issue.

Clause 7 provides for the release of information to Ministers. Once the information has crossed over from the OFT to the relevant Minister, does the status of the information change so that people have a different right of access to it? One concern is whether the Human Rights Act 1998 could be used to obtain information.

We are talking mainly about companies being regulated and breaking the law, but it is also important to talk about protecting companies, because in modern life, access to information is vital. It must be appreciated that, in other jurisdictions, particularly ones with more liberal access-to-information laws, the law is increasingly being used as a sword as much as a shield. In other words, companies are getting confidential information–

 
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