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Lord Redesdale: My Lords, I have attached my name to the amendment. I should like to commend the noble Lord, Lord Peston. As regards the last point just made by the noble Lord, if he had been present at the last stage of the proceedings on the Bill he would know that that is one of the central issues. Indeed, the noble Lord, Lord Peston, has managed to table an amendment which has been sufficiently watered down so as to enable the Minister to give us an indication of the Government's support.

One of the problems that we on this side of the House have is that, during the last stage of the Bill, the Minister quite rightly pointed out many flaws in the amendments that we put forward. He pointed out that they would make the job of passing the Bill more difficult and that they also seemed to be quite negative. We pushed for the establishment of an advisory board to give advice on how the legislation could be implemented and, therefore, how the convention could be upheld. We are dealing with a very complex field in which a great many changes will take place as the years progress. We wanted to ensure that as many as possible of the changes that could take place would be given proper regard.

I have one point to make on the Bill. It relates to the confidentiality provision. On the last occasion the Minister stated that companies would have great difficulty in the fact that, if they put forward too much information, their commercial confidentiality would be at stake. I hope that the Minister can give us some indication that the provision will not be used as a smokescreen for companies which do not comply totally with the spirit of the Bill. I hope that the Minister will give us an assurance on that.

The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, I wish to respond immediately to my noble friend Lord Boyd-Carpenter. At an earlier stage in this Bill the anxiety I had was that the Government or the Secretary of State should not be confined to receiving advice from one source only because on a complicated matter such as this there may be many occasions and different circumstances where we would want to receive advice from a wide range of bodies. In some circumstances that would necessarily be confidential. I can confirm to my noble friend that we shall be seeking advice across a broad front. The only circumstance we wish to avoid is being restricted to taking advice from one particular source, as was suggested.

I do not think I shall surprise the noble Lord, Lord Peston, when I say that I do not intend to accept the amendment. That is not because I object to it in principle, but because I believe it is unnecessary. As I understood the noble Lord, his concern was that he should give me an opportunity to explain in more detail the Government's proposals in respect of the annual report. I am happy to attempt to respond to the opportunity that he has afforded me. I am pleased that both noble Lords who have tabled this amendment appear to have accepted the arguments I put forward against specifying the precise content of the annual report in statute.

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The national authority will require companies and academic bodies to provide information. If this information is to be given freely, those giving it must be confident that the information will be properly protected and that secrets will not be disclosed. Any list of contents in an annual report must not cast doubt on the protection that will be given to confidential information. However, the aim of the annual report is--as the noble Lord identified--to assure Parliament that the Secretary of State is undertaking his responsibilities under the Act effectively. There is a clear tension, which has been properly identified by the Royal Society of Chemistry in its useful briefing, between including enough information in the annual report to provide this necessary assurance, and properly protecting confidentiality. It would be too difficult, I believe, to specify the content of the report in statute in a way which would satisfy those competing demands.

The approach that we have included in the Bill is neither a comfortable one nor a soft option but will ensure that the report provides the right information to Parliament. The Secretary of State will have to pick through all the information at his disposal and decide, within the constraints of commercial confidentiality and national security, how best he can satisfy Parliament that he is undertaking his responsibilities effectively. The report could not hide behind a poorly targeted contents list laid down in statute.

I have said that this amendment is in my view unnecessary. I need not remind noble Lords that the annual report will be about the implementation of a significant arms control treaty. Any report prepared on the basis proposed in the Bill will be prepared in the knowledge that it will be subject to careful scrutiny by this House and by many expert people outside. There is no doubt that the annual report will have to contain sufficient information to provide assurance that the Secretary of State is doing his job effectively. I can assure noble Lords that the report will be as informative as it can reasonably be. I hope that assurance will be accepted.

I have announced in earlier debates our intention to establish an advisory committee. The views of the advisory committee will be sought on the draft report. If the committee believes the annual report does not present a complete picture of the activities of the national authority, it will be able to draw its anxieties to the attention of the Secretary of State directly. This will provide a further safeguard that officials are not being over-cautious when drawing up the report. The noble Lord, Lord Redesdale, was concerned about that.

I hope that with that expanded explanation on the way we wish to approach this matter, and recognising that clear tension which the noble Lord, Lord Peston, also recognised, he will appreciate that our desire is exactly the same as his; namely, to ensure that there is as comprehensive a report as possible. We do not wish to have this amendment on the face of the statute because we believe it is unnecessary rather than objecting in principle to trying to provide the type of report that he would wish.

Lord Peston: My Lords, I thank all three speakers who have contributed. I worry that no matter how gentle, restrained or uncontroversial I seek to be in

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anything I say, I still seem to raise someone's hackles at some point. I assure the noble Lord, Lord Boyd- Carpenter, that he knows me well enough to realise that if I were looking for trouble I could have found a dozen or two dozen amendments to keep your Lordships going for several hours. We are somewhat at the fag end of our dealings on this matter. The intention of the amendment was as the Minister recognised; namely, to elicit from him precisely the remarks he has made. I think that the noble Lord, Lord Redesdale, would agree with me that the Minister has done that; namely, he has guaranteed that we shall obtain the kind of serious report that we would wish to have.

I have no doubt at all that Her Majesty's Government will pursue this weapons question vigorously. One of the reasons we have been anxious to get the Bill on the statute book is precisely to enable us to get going with that matter. I thank the Minister for his reply and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Arbitration Bill [H.L.]

3.16 p.m.

Report received.

Clause 2 [Scope of application of provisions]:

Lord Fraser of Carmyllie moved Amendment No. 1:


Leave out Clause 2 and insert the following new Clause--

Scope of application of provisions

(".--(1) The provisions of this Part apply where the seat of the arbitration is in England and Wales or Northern Ireland.
(2) The following sections apply even if the seat of the arbitration is outside England and Wales or Northern Ireland or no seat has been designated or determined--
(a) sections 9 to 11 (stay of legal proceedings, &c.), and
(b) section 66 (enforcement of arbitral awards).
(3) The powers conferred by the following sections apply even if the seat of the arbitration is outside England and Wales or Northern Ireland or no seat has been designated or determined--
(a) section 43 (securing the attendance of witnesses), and
(b) section 44 (court powers exercisable in support of arbitral proceedings);
but the court may refuse to exercise any such power if, in the opinion of the court, the fact that the seat of the arbitration is outside England and Wales or Northern Ireland, or that when designated or determined the seat is likely to be outside England and Wales or Northern Ireland, makes it inappropriate to do so.
(4) The court may exercise a power conferred by any provision of this Part not mentioned in subsection (2) or (3) for the purpose of supporting the arbitral process where--
(a) no seat of the arbitration has been designated or determined, and
(b) by reason of a connection with England and Wales or Northern Ireland the court is satisfied that it is appropriate to do so.
(5) Section 7 (separability of arbitration agreement) and section 8 (death of a party) apply where the law applicable to the arbitration agreement is the law of England and Wales or Northern Ireland even if the seat of the arbitration is outside England and Wales or Northern Ireland or has not been designated or determined.").

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The noble and learned Lord said: My Lords, this amendment will replace the existing text of Clause 2 in its entirety. Although the revision appears at first sight to be extensive, I hope that I can assure the House that what is intended is no more than a clarification of the original text. No essential change of policy or direction is either intended or achieved. The broad purpose of that clause is to define the circumstances in which Part I of the Bill has application so as to enable parties to international arbitrations readily to ascertain when they will and when they will not be affected by our law of arbitration and the jurisdiction of our courts. The clause as originally introduced was to have and, I think, substantially had that effect. However, it was perceived by some international jurists as purporting to have some extra-territorial effect, and therefore to confer jurisdiction on our courts which might in the case of an international arbitration cause conflict with the jurisdiction of foreign courts. This was never our intention and therefore we have redrafted the clause to clarify its meaning and to remove these unexpected doubts about its scope.

We have achieved this clarification largely by changing the basic principle in subsection (1), which was formerly expressed in terms of where our law applied, so that it will now be expressed in terms of the seat of the arbitration. Where the seat of the arbitration, which is defined in Clause 3, is here the whole of Part I will apply without exception. The remainder of the clause is concerned with cases where either the seat is not here or no seat has or has yet been designated or determined. The new subsection (2), which corresponds to the former subsections (3)(a) and (3)(c), ensures that our obligations under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, will always be fulfilled.

The new subsection (3), which corresponds to the former subsections (3)(b) and (4), ensures that our courts will have power to make orders in support of an arbitration with no seat here except where to do so would be inappropriate. Subsection (4) is new. It is necessary because the focus of the clause has now changed from what is the applicable law to where is the seat of the arbitration. It gives our courts all the powers they have over an arbitration with a seat here in a case where the court is satisfied, as a matter of English law, that there is no seat elsewhere. If there is no seat elsewhere, there could be no possible conflict with other jurisdictions. In addition, these powers are only exercisable where there is a domestic connection and where it is appropriate to exercise them. A good example would be a case where an extension of time is needed, under Clause 12, to commence arbitration proceedings which, when commenced, would be likely to have a seat in this country.

Subsection (5) is new and is also necessary because of this change in focus. Even if there is no seat here, the question whether the arbitration clause is separable from the contract containing it and the question of the consequences of the death of a party are both to be determined under the relevant clauses of the Bill where our law is applicable to the arbitration agreement.

I trust that this explanation will relieve any possible anxiety that anything more is intended by the amendment than a change in presentation and

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clarification of what, I am sure noble Lords will agree from that explanation, is necessarily a complex subject. I beg to move.

On Question, amendment agreed to.

Clause 38 [General powers exercisable by the tribunal]:


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