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Lord Kingsland: I thank the Minister for his response. I am happy in the circumstances to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Kingsland moved Amendment No. 173:

Page 23, line 5, at end insert--
("( ) requiring production of a specified document under section 26(1)").

The noble Lord said: In moving Amendment No. 173, I shall speak also to Amendment No. 174. The amendments add categories to the list of appealable decisions. Amendment No. 173 requires production of a specified document under Section 26(1). Amendment No. 174 provides,

I believe that the amendments are self-explanatory. I do not need to add anything to them.

Lord Simon of Highbury: The amendments seek to enable appeals to the competition commission against the director's use of his investigation powers.

Clause 45 provides for appeals against decisions by the director. This allows people and businesses to appeal against decisions which, if put into effect, will damage their interests--for example, a decision to impose a penalty, or a direction to stop engaging in a particular business practice. Such decisions could obviously have a significant impact on those affected.

Requests for documents by the director under his powers are not substantive decisions. An individual or business will not suffer any harm by producing a document, or explaining a document to the director--unless, of course, the document reveals that there has been wrongdoing, in which case the document is obviously relevant.

It is only an offence under the Bill to refuse to provide a document which is relevant to the investigation. No one can be successfully prosecuted for not producing a document if it is not relevant.

This all harks back to the very full debate we had about the need for a director to have the powers of investigation he needs to be able to enforce the prohibitions effectively. It is the Catch-22 situation that we spent some time discussing before dinner. I hope it will not return. I shall soon be calling it the Yossarian effect. I think that it is right that the director should be able to see any relevant documents in order to investigate matters properly. It can do a firm no harm to produce such documents for a director. There are clear safeguards in the Bill to protect information contained in such documents. Indeed, criminal sanctions would apply to any unlawful disclosure of such information by the director.

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Having sought to elaborate on the difference between a decision and a documentation, I urge the noble Lord to consider withdrawing the amendment.

Lord Kingsland: As the Minister rightly observed, in an earlier debate we investigated the meaning of relevance, in particular the objectivity or otherwise of the person who decided whether or not a document was relevant. I believe the Minister said that one cannot be prosecuted for not producing a document that is not relevant. The difficulty about that approach is that the person who decides whether or not a document is relevant is the director general. On the face of the Bill, his discretion on this matter is absolute. Therefore those words may not be as comforting as the Minister might genuinely and in a bona fide way have considered them to be.

I hope that the Minister will consider the two amendments in the light of the earlier debate. I believe that this issue of relevance is fundamental to the procedures. If there is no way in which the director general's view about relevance can be questioned, it is a serious defect in the due process that the Minister seeks to guarantee and might suffer at the hands of the courts at a later stage. I therefore ask the Minister, not only for the successful operation of the Bill, but also because of the legal context in which it has to operate, to reflect carefully on this issue when he returns at Report stage. In those circumstances I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 174 not moved.]

9.45 p.m.

Lord Kingsland moved Amendment No. 175:

Page 23, line 9, at end insert--
("( ) on a Director's finding within the meaning of section 56(2)").

The noble Lord said: This amendment relates to Clause 45 (3). It seeks to establish a right to appeal,

    "on a Director's finding within the meaning of section 56(2)".

Clause 56(2) defines a director's finding as,

    "a finding of fact made by the Director in the course of determining an application for a decision under section 14 or 22".

In our submission, it is an important protection for the individual or company that is being investigated to have a right of appeal in those circumstances. I beg to move.

Lord Simon of Highbury: The issue raised by the noble Lord is an interesting one. It might be helpful if he could clarify whether the right of appeal is before the finding and decision of the director general, or after. It is a matter of some interest as to where the appeal is positioned or whether this is just a general statement.

Lord Kingsland: A case could be made out for both. However, the amendment as I see it refers to an appeal after the decision is taken in relation to the factual underpinning of the final decision.

Lord Simon of Highbury: I am grateful to the noble Lord for that elucidation. It is important that we

17 Nov 1997 : Column 451

understand the sequence well. It is appropriate for the process to be followed and a decision made by the director, and a total finding then to be appealable on the basis of the facts. We would not like to split the process going through to the director by appealing facts on the way. That may not be the most efficient process. However, there is an interest in considering the way in which an appeal on facts made after the decision is built into the construction of these clauses. I shall think extremely hard about the position that the noble Lord has now clarified; I wish to reflect on it before Report stage.

Lord Kingsland: I am most grateful to the Minister for that response. In those circumstances I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 176 and 176A not moved.]

Clause 45 agreed to.

Clause 46 [Third party appeals]:

Lord Kingsland moved Amendment No. 177:

Page 23, line 17, leave out ("Director asking him") and insert ("Tribunal asking it").

The noble Lord said: I shall move Amendment No. 177 and speak also to Amendments Nos. 178 to 187. The point is simple. In our submission the appeal should not be to the director but to the tribunal. It will give third parties who have a sufficient interest in the decision the right to appeal to the tribunal. It seems to us that the objectivity of that approach is a better solution than the one set out in the Bill. I beg to move.

Lord Simon of Highbury: In responding to the group of amendments tabled by the noble Lords, Lord Kingsland and Lord Lucas, it may be helpful to outline the considerations behind devising the mechanism by which third parties should be able to appeal a decision of the director.

Clearly it would have been unacceptable for the director himself, without the safety net of appeal, to determine whether the third party had the requisite interest to challenge his decision and, if so, whether to change his decision. None of us likes having our decisions overturned, even directors general in white hats or whatever appropriate clothing the noble Lord, Lord McNally, ascribed to them. That is why we have allowed appeal on the question of having the requisite interest and, if so, whether the decision should be changed. That is an important safeguard and ensures that the clause strikes the right balance.

However, we carefully considered the option proposed by the amendments of the noble Lord, Lord Lucas, of allowing a third party to go directly to the tribunal without first approaching the director. It may be that many Members of the Committee have put down amendments in this large group and I hope that I have not ascribed any amendment to the wrong noble Lord. I am grateful for the opportunity to listen to the arguments. However, I continue to prefer the approach set out in Clause 46. That is because it should help avoid unnecessary appeals.

17 Nov 1997 : Column 452

For example, the third party might have new information which was not available at the time the director took his decision. The director could discuss the new information and concerns with the parties who are the subject of the decision and it might be that a revised decision is issued which is acceptable to all and which avoids the cost of setting up an appeal tribunal.

If the director accepts that the third party has the requisite interest in the decision, this procedural question does not then have to be determined as an initial issue by the tribunal before the main appeal. Once again costs could be saved. I accept that the director will not be keen to have his appeal challenged, but when he is determining the issue of requisite interest under Clause 46, of course he must and will act reasonably and within the law. The director, with his detailed knowledge of the case, should be able to come to a view quickly. The tribunal, on the other hand, would have to spend far greater time examining the case before being able to come to a decision on this initial procedural question. If the director accepts that the third party has the requisite interest under Clause 46, the tribunal can be saved this task.

Finally, by obliging the third party to approach the director first, the tribunal will have an established issue to determine between two opposing parties. The amendments do not provide for the director to be an opposing defendant before the tribunal.

Turning now to Amendment No. 181 of the noble Lord, Lord Lucas, this amendment would prevent representative actions. The Government believe strongly in an appeals system which is fair and transparent in which the business community and consumers have a fair right of appeal.

If we were to prohibit organisations representing third parties with a sufficient interest to appeal a decision, we would certainly severely prejudice the interests of consumers. An individual consumer may not have the time or resources to appeal a decision on his own; if consumers are to have a real voice in the new system, it must be possible for organisations such as the Consumers Association to be able to appeal a decision on their behalf. The same arguments apply to small traders who may have to rely on their trades institutions. In the light of these explanations, I hope noble Lords who tabled that series of amendments which run through cost efficiency in the nature of the appeal and then the ability of the small man to be represented by what to him seems a Goliath in taking an appeal forward, will see fit to withdraw them.

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