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Mr. Foster: After a short pause, I rise with some trepidation and concern. Having had a phenomenally successful run this morning, I am confident that I shall not have any success whatever in relation to this issue. We return yet again to the debate we had on clause 83 concerning the requirements for identity. During those deliberations, the Minister made it clear that we were to wait for further information in relation to the third European directive on money laundering, among other matters. I am merely giving him the opportunity to say something that he might have omitted during our discussion of clause 83 or that has come to light since that discussion.
Mr. Caborn: My lengthy brief has been condensed to three paragraphs, which will accord with the Committee's wish that we focus on the issues this afternoon. I shall give a full explanation of the position on money laundering, and it would be helpful if I did so without being asked to give way because the position is somewhat complex.
Casinos throughout Europe are subject to a money laundering directive, which, as well as imposing requirements on a wide range of financial institutions, requires casino customers to be identified if they buy or sell chips above a value of è1,000. However, two
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things are set to change. First, the Bill will remove the requirement in the Gaming Act 1968 for casinos to operate as members' clubs. It will, of course, be open to casinos to continue to operate as members' clubs if they wish, and we made that clear during an earlier debate. Some may choose to do so, but others may not, and we should not frame the Bill in the expectation that all casinos will be for members only, which is an unnecessary regulatory requirement provided that other safeguards are in place.
The second change in prospect is that the EU is currently considering a new draft money laundering directive, which will reinforce and extend the controls in the present directive. The Treasury remains in the lead on that and has been consulting interested bodies, including law enforcement agencies, regulators and, of course, the businesses that will be affected by the new directive, including casinos. People going into such areas will have to go through identity checks, whether or not they gamble. In the Government's view, that is unnecessary for a number of reasons. First, requirements as to identification and verification of identity for the purposes of controlling money laundering can and, indeed, should be set in specific money laundering regulations made by the Treasury, which implement the requirements set out in the EU directive. We cannot yet be sure what the new directive will require, and it would not be sensible to try to anticipate it by including detailed and specific provisions in the Bill.
Secondly, we are not persuaded that it would be right in future to require identification on entry in all cases, even though we do so now. As I have explained, the casinos of the future will not be the same as casinos now. Furthermore, the identification requirements in the new directive are likely to be more challenging than the requirements in the present directive. It would not be appropriate to go into the details of the consultations that have been taking place with industry bodies, or the discussions with other member states.
We expect that, fairly soon, a proposal will be agreed by member states and go to the European Parliament for consideration. What I can say is that it is likely that the new directive, like the present directive, will provide a choice between mandatory identification at the point of crossing a financial threshold or identification on entry. I can also say that a number of casinos have made clear their view that, in the context of the system of gambling regulation proposed in the Bill and, in particular, the removal of compulsory casino membership schemes, it would be more appropriate to check the identity of customers at the financial threshold and not at the physical threshold of the premises or some specific area of the premises. The amendment would shut off that option by requiring identification on entry to that area of a casino that includes gaming tables and higher-value gaming machines. I ask the hon. Gentleman to withdraw his amendment.
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Mr. Foster: I am grateful to the Minister for amplifying some of the points he raised during our consideration of clause 83. May I tell him gently that he has said in two different ways that he firmly believes that the third European directive will be more challenging than the second? He also said that the third directive will be likely to reinforce and extend the controls in the second. Regulation 8(1) of the Money Laundering Regulations 2003 and article 9 of the draft third EU directive make it clear that the issue of identity does not come in only when there is an exchange of funds in excess of è1,000. Regulation 8(1) says:
''A person who operates a casino by way of a business in the United Kingdom must obtain satisfactory evidence of identity of any person before allowing that person to use the casino's gaming facilities.''
That means before any use—regardless of whether there is an exchange in excess of è1,000.
Article 9 states:
''Member states shall require that all casino customers shall be identified''.
The identity must be verified later when there is a transfer of è1,000.
I suggest that the Minister's statement that the situation will occur only when money changes hands, is unlikely to be reflected in the third European directive. He nevertheless makes the fair point that it would be better to wait for that directive in order to ensure that it will apply to all casinos in the United Kingdom, and that it is not necessary to require such provision in the Bill. There will be a further opportunity when we have more information about the development of the third directive.
Mr. Caborn: I have made two points. The money laundering directive is about much more than casinos, and the Treasury is discussing it with businesses, banks and regulators. The regulations under the second directive required identity checks on entry, but we are considering how to implement the third directive. It is under discussion with industry, but the lead Department is the Treasury, and the hon. Gentleman will appreciate that the implementation of the third directive has much wider implications than just for casinos.
Mr. Foster: I am grateful for that further explanation. The Minister will be aware that there are concerns additional to those about money laundering. They lead some people, including myself, to believe that identity provision might be useful, particularly for tracking problem gamblers. For those reasons, I believe that this is an issue to which we will return, but I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 143 ordered to stand part of the Bill.
Clause 144 ordered to stand part of the Bill.
<<353>>Clause 145
Principles to be applied
Mr. Foster: I beg to move amendment No. 359, in clause 145, page 64, line 38, leave out 'not'.
Lest the Minister draws my attention to clause 68 and the fact that we have already agreed to it and its making clear that a demand test is not required, I point out that that clause relates to the granting of an operating licence by the commission, and that in this clause we are discussing the granting of a premises licence by a licensing authority, namely a local authority. I remind the Minister that I am still waiting to receive a letter from him explaining the absence of unitary authorities in the list of those councils that are meant to be licensing authorities. He will recall that we are still trying to find out whether Bath and North East Somerset is a unitary authority or whether it will have to call itself something like a county without districts, bearing in mind there is no such county. I hope that I get an assurance from him to return to that matter.
The amendment relates to the issuing of premises licence by a licensing authority. We will shortly debate clause 157, which gives local authorities clear powers to say no to any casinos whatsoever for three years. That is a welcome power for local authorities.
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The Minister will be aware, however, that some local authorities will not want to have to invoke clause 157, or a complete ban on all casinos, but will want an opportunity to consider, case by case, individual proposals for planning and premises licences. In doing that, they need to maximise their power to refuse the application. Many councils are aware that when they have considered casino and other planning applications in the past they have had had good reasons, as representatives of the local people, to deny the application, only to find their decision overturned on appeal to the planning inspectorate on behalf of the Secretary of State. They are therefore conscious that their powers are not as total as they would like.
Surely it is important to enable councils to have the maximum range of powers to assist them in deciding whether to reject an individual casino application for a premises licence. That is why it is important that we return to the demand test as one of the measures that authorities can reasonably expect to use during their deliberations on an application. The amendment, which would simply delete the word ''not'', would mean that local authorities could take into account evidence along the lines of a demand test.
Mr. Caborn: I sent a letter to you, Mr. Gale, as the Chairman of the Committee, on the hon. Gentleman's point about the explanation on local authorities and their status. I do not know whether that has been passed on, but I wanted to clear that up. I have not written to the members of the Committee individually, but through your good office.
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The Chairman: Order. I am ashamed to say that I have not seen a copy of any such letter. The Clerk tells me that neither has he. If the ministerial team would be kind enough to pass a copy to the Clerk, we will make sure that it is circulated.
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