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Lord Williams of Mostyn moved Amendment No. 18:


Page 7, line 37, leave out ("within a reasonable time").

On Question, amendment agreed to.

The Deputy Speaker: My Lords, I advise the House that if Amendment No. 19 is agreed to, I cannot call Amendment No. 20.

Lord Norton moved Amendment No. 19:


Page 7, line 39, leave out from ("subject") to ("would") in line 44 and insert ("where there are compelling legitimate grounds for believing that the processing of those data or their processing for that purpose or in that manner").

The noble Lord said: My Lords, the amendment relates to Clause 9:


The amendment seeks to replace the words "substantial damage" and "substantial distress" with the words appearing in Article 14 of the directive: "compelling legitimate grounds".

As the clause is drafted, the information which is being processed legally may not be processed if it is likely to cause the data subject substantial damage or substantial distress, together with a further test that the damage is unwarranted. Presumably, if the data controller dislikes the data subject and acknowledges that substantial damage or distress is going to be caused, but considers that the processing is warranted, then the data processing is permissible. After all, the criteria are all subjective judgments.

I have been informed by officials at the Home Office that there is no hidden agenda behind the wording of the clause and that the words "substantial damage" and "substantial distress" are their interpretation of the meaning of "compelling legitimate grounds".

I disagree, which is why I have tabled the amendment. I should be grateful to hear the Minister's reasons as to why the damage should be unwarranted. A further complication appears to present itself in that the data subject appears to have no rights to object to data processing, whether or not it causes damage, once the data subject has given consent under paragraph 1 of Schedule 2. That is contained in subsection (2)(a) of the

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clause. That seems to be a little harsh. I should be grateful to hear the Minister's explanation for that point. I beg to move.

The Earl of Northesk: My Lords, I apologise. I missed the opportunity to speak to Amendment No. 17 when the Minister spoke to the whole group of amendments. I shall intervene here and speak to my concerns relating to Amendments Nos. 24 and 25.

Amendment No. 24 mirrors the requirement that we shall presumably pass in Clause 9 that the data controller should have a duty to advise data subjects of those steps being taken to ensure that the processing of their data has ceased or will not even begin.

Of course, Clause 9 seeks to prevent processing that is unwarranted, as causing or being likely to cause substantial damage or substantial distress. For such data the additional protection of the data subject being advised of how the data controller intends to prevent processing is eminently sensible. There is nothing wrong with that. I am less certain that that is an appropriate approach to Clause 10, which relates to direct marketing.

As the Minister will be aware, a widely used practice in the direct marketing industry is that of offering the customer the opportunity of indicating his wish not to have his data further processed by means of an opt-out tick box. That methodology has distinct advantages. It is simple, concise and clear to both the customer and the business concerned. At issue here is whether it is intended that such tick boxes should be interpreted as being data subject notices. Legal advice obtained by the British Retail Consortium indicates that they should be. If that is the case, it will have the inevitable effect of adding considerably to the administrative costs of, for instance, the mail order catalogue industry.

The isolation of negative option ticks from the volume of orders processed within the specified time frame of 21 days would involve extensive extra work and cost. Moreover, on the basis that that system has operated well enough to date, it is highly unlikely that any real benefit would accrue to the data subject in those circumstances. In fact, he could be severely inconvenienced in the event that, on strict interpretation, he may be required to send any written objection to further processing separately from his having ticked the opt-out box.

In effect, the amendment's application to that practice will do little to enhance consumer protection or human rights. It may even work actively against them. I hope that the Minister will be able to tell me that, as with the slightly related amendment in Grand Committee, I am worrying unnecessarily although, as I have said, the BRC's legal advice is that I am not.

That said, if my interpretation is correct, it strikes me that Amendment No. 24, notwithstanding the Bill's avowed intent to strike an appropriate balance, will work disproportionately against the direct marketing industry. It may be worth adding that, on my interpretation, that industry would, in any event, be subject to the similar provision in Clause 9, albeit only

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in severe cases, and that that could be interpreted as being adequate to afford data subjects the protection intended by the amendment.

On that basis, I wonder whether Amendment No. 24 is strictly necessary, especially bearing in mind that the directive gives no indication that the procedure arising from it is required. Inevitably, I return to my refrain. It seems to me that this is another instance of a substantive matter, not widely trailed, which will alter the balance on the face of the Bill.

I move to Amendment No. 25. Clause 13 as it stands complies with the directive. On my interpretation, Amendment No. 25 will widen the effects of the Bill into areas not effectively allowed for in the directive. As I understand it, Amendment No. 25 envisages that an individual, writing in advance to a series of companies with which he does not necessarily have any contract, would be entitled to assert his right to ensure that the data controller in question would make no decisions about him based solely on the processing of his personal data by automated means.

On the surface, that seems to be a case of creating work when no work is necessary. I am bound to ask what purpose such a procedure is intended to serve. How often do the Government envisage that data subjects will exercise their rights in that regard? So far as concerns data controllers, it will mean inevitably that they will have to introduce systems and train personnel to accommodate such requests from data subjects, even though they may not have had any dealings with them.

Experience has shown that training staff to perform functions that are seldom put to use, or serve no useful apparent purpose, is not only wasted but debilitating to the morale of the staff concerned. What is important is that it has the adverse effect of diluting the effectiveness of training. On a more general level, it could be interpreted as having the effect of imposing unnecessary burdens upon business rather than retaining the proportionate balance that the Bill is intended to serve. I question whether that is the Government's intention.

I return to my refrain, although I suspect that it is unlikely to be heeded, that, surely, this is another occasion when further reflection between now and Third Reading would be desirable.

5.30 p.m.

Lord Skelmersdale: My Lords, I welcome Amendment No. 24 because it gives me an opportunity to make three points. First, I thank the Minister for fulfilling his promise in Grand Committee to write to me about direct advertising by the tobacco trade.

Secondly, over many years, and most recently in a joint EC sub-committee and the Statutory Instruments Joint Committee on which I had the honour to serve, I have been interested in the processes by which European law is translated into British law. Indeed, on occasions I have identified the temptation, to put it mildly, of officials, in the deliberations between Brussels and Parliament, to add little twiddles to miscellaneous European legislation. It occurs to me that this might be one such case and if so it is perhaps desirable.

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The Liberal Democrat Benches gave an example of "gold plating", as it is known, receiving public approval and the Minister accepted an amendment in principle on that basis. It is pertinent to the operation of the directive in this country, with our particular and peculiar circumstances. However, it is not acceptable when the "gold plating" is hidden and I believe that this might well be such a case.

Amendment No. 24 defines a data subject notice. References to all other definitions in the Bill are found under Clause 62. Therefore, I believe that reference to the notice could, with some degree of use and therefore clarity to those reading the Bill, be included in Clause 62. I hope that the Minister will consider that.

Lord Williams of Mostyn: My Lords, I certainly can and if it is an appropriate course to take we will take it. I shall take advice on the matter.

I am grateful for the welcome given in part by the noble Lord, Lord Skelmersdale, and for the comments made by other noble Lords. Specific questions have been raised; for instance, whether under Clause 9(2)(a) any consent given under paragraph 1 of Schedule 2 is not capable of being withdrawn? Any consent given in any part of the Bill may be withdrawn at any time and there is nothing to prevent that.

The noble Earl, Lord Northesk, asked about the problem of the tick box. We believe that a tick box is capable of being a written notice for the purposes of Clause 10(1). The noble Earl indicated that there had been discussions with various trade organisations and officials. We remain of the view that if further discussions are thought to be appropriate officials are always ready to consider improvements. I stress that these are difficult technical areas and we welcome informed criticism and scrutiny. I hope that we have demonstrated that throughout the passage of the Bill.

As regards the amendment tabled by the noble Lord, Lord Norton, the directive uses the words "compelling legitimate grounds relating to his particular situation". In our judgment, that is not satisfactory statutory language. I take the point that if at all possible one ought not to twiddle. Perhaps one ought to try to use the spirit and language of the directive and translate it into what is apt for our particular legislative and constructive tradition. We do not believe that the phrase "compelling legitimate grounds relating to his particular situation" is satisfactory in terms of statutory language. It does not mean much, except that the data subject must make a strong case.

We do not see that the courts will be able to give a reliable interpretation of that. How is the data controller, going about his lawful business, to know when he must yield to the interests of a data subject? We believe that this is one of the instances, referred to earlier, where there is a need to bring the words of the directive into sharper focus in order to obtain clarity and consistency. We have taken the view that for a data subject to make out compelling legitimate grounds he must make a case that the processing would damage him or someone else in some way; physically, in monetary terms or by way of distress. Because the presumption is that the data

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controller must be able to go about his lawful business, we have said that to be a compelling case the harm must be substantial and unwarranted.

That is a high threshold and is intended to be such. The directive indicates that. I do not wish to sound brutal, but some loss and distress are the small change, the regular consequences, of competition. One man's success in business may be his competitor's disappointment. That is not what the legislation is supposed to be about. We need to define matters with care and we believe that the literal words of the directive will not do. The directive's job, in Article 14, is to state terms of policy. The Bill's job is to work that policy carefully into the existing framework of enforceable rights and freedoms laid down elsewhere in the directive. It is not simple, but we believe that we have got it about right, giving effect to the intentions of the directive, in essential guidance on which everyone involved can confidently rely.

Finally, we must come to a judgment about where we draw the balance. I hope that your Lordships will believe that we have done so properly. Perhaps I may refer again to the issue of objection which was raised in a more general context by the noble Earl, Lord Northesk, as opposed to his specific question about tick boxes. We are trying to safeguard the interests of business. Instead of expecting someone in business, running any form of organisation, to have to run the gauntlet of the entire regulatory mechanism which the Bill sets up, we say that until someone objects it is a matter for the judgment of the data controller.

I take the noble Earl's point that one might be setting up systems and having employees trained for the rather arid task of doing nothing--quite unlike any experience on the Front Bench in your Lordships' House! We have taken the model which most people believe is capable of working sensibly and reasonably in practice; the right to object to direct marketing as set out in Clause 10. It is true that one might have the extreme circumstance of the excessive individual who will write objecting to companies which have no sensible connection with his or her activities. However, we believe that that will be most unusual. Most people exercise their rights sensibly and we must construct a legislative framework which will deal with that.

I hope that with those comments I have satisfied your Lordships of the merits of the Government's amendment and I ask the noble Lord, Lord Norton, to withdraw his.


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