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Lord McIntosh of Haringey: My Lords, that is an interesting point. I believe that the answer is that Amendment No. 80 provides equality for establishment and the provision of services, whereas paragraph 12, which Amendment No. 80 replaces, does not make that distinction. My understanding is that the directives only provide the right to cross-border services which are carried on in its own home state. Paragraph 14 reflects the narrower scope of the European Union directives. If I have got that wrong or not made it clear, I shall certainly be pleased to write to the noble Lord.

On Question, amendment agreed to.

Lord Kingsland: My Lords, I wish to speak to this group of amendments.

The Deputy Speaker (Lord Brougham and Vaux): My Lords, if the Minister moves Amendment No. 81, the noble Lord, Lord Kingsland, can speak.

Lord McIntosh of Haringey moved Amendment No. 81:


The noble Lord said: My Lords, I had already spoken to this amendment with Amendment No. 80. I beg to move.

Lord Kingsland: My Lords, as I understand the procedure, the Minister opens; and if no other noble Lord wishes to speak, the Opposition reply. I am simply exercising that right. Perhaps I may put it another way: I am performing that duty.

Lord McIntosh of Haringey: My Lords, I am sure it is my fault. The noble Lord, Lord Stewartby, spoke to Amendment No. 80 and I replied immediately without giving the noble Lord, Lord Kingsland, the opportunity to contribute. I apologise to him. It is entirely legitimate for him to make his points on Amendment No. 81 instead.

Lord Kingsland: My Lords, I thank the noble Lord very much indeed for his apology. I was not suggesting

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that he had done anything wrong. I am simply saying that the procedure had unfolded in such a way that I had not had the opportunity to speak. It now transpires that I can.

As regards the amendments to Schedule 3, they are mostly drafting amendments and do not change the substance of the existing provisions. The one point of note is that, as the Government have indicated, the amendment to line 39, on page 245 of the Bill, makes it clear that, in the normal way, the authority merely decides to refuse consent rather than actually refusing it. At the decision stage, although it does not issue a decision notice, the authority notifies the firm that it has decided to refuse consent and the firm may then appeal to the tribunal.

In the Government's Explanatory Notes they say that they are making it clear that the decision to issue a decision notice is not the final determination of the matter because the firm has the right to refer the matter to the tribunal and the normal provisions suspending the effect of the decision notice come into play.

However, in our view, that is not expressly stated in the amendment. Amendment No. 85 relates to paragraph 20. It provides that the authority's consent is required for specified changes to the firm or to an activity that it carries on. Neither Amendment No. 85 nor paragraph 20, as amended, provide that the authority must issue a decision notice when the firm applies for consent. All that is said is that, if the authority decides to refuse consent, the firm concerned can refer the matter to the tribunal. Presumably, the authority must notify the firm of its decision to refuse consent, but as it is not by way of a decision notice, the protective provisions in Clause 130, as amended, which refer to the procedures originating with the decision notice, never come into play.

Accordingly, in our view, Amendment No. 85 should be amended so that it requires the authority, when it decides to refuse consent, to issue a decision notice and then go on to say that the firm concerned may refer the matter.

I believe that this is just a problem of clarification. I do not believe that there is a difference of substance between us. However, it is an important matter and I hope that the Government can suggest another solution to this if our suggestion is not palatable.

As regards Schedule 4, in principle, the amendments are only drafting amendments. The Minister has explained that the reason for the reorganisation is that the present provisions of paragraph 5 require a treaty firm to issue a new notice to the authority each time it wants to begin a new regulated activity. As I understand these amendments, therefore, they provide that only one notice is needed.

I say this with great respect. Perhaps the Government will make it clear that the permission to which Amendment No. 87 refers is a permission granted under paragraph 4 of Schedule 4--in other words, a passported permission. I believe that that is what is intended; but because the amendment refers

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merely to a permission, and does not limit it to a Schedule 4 permission, it also covers Part IV permissions.

The fact that it could be read that way is made clear by the terms of paragraph 4(3). The notice that the authority requires is a notice that the treaty firm intends to use its Treaty of Rome passport under Schedule 4. The present wording of Amendment No. 87 does not achieve that.

Perhaps a solution would be to refer in Amendment No. 87, heading (b), to "permitted" instead of "regulated" in both places. Another potential solution would be that after the word "permission" in heading (b) we could insert "under paragraph 4(1)".

Lord McIntosh of Haringey: My Lords, I am grateful to the noble Lord for explaining his concerns. I deal first with Amendment No. 85. The noble Lord is quite correct. The point is that it is a decision to issue a decision notice--in this case, a decision notice refusing an application--which is the trigger for the right to refer the matter to a tribunal. Therefore, instead of saying that a person refused consent may refer the matter to the tribunal, if the authority decides to refuse consent without necessarily implementing that decision, there is reference to the tribunal and there is no interruption of the business involved. That should be an improvement.

However, in case we have misunderstood each other we shall look at the points the noble Lord has raised and write to him about it and, if necessary, make an amendment. It seemed clear enough to me that we were doing what the noble Lord wanted. As regards the amendments to Schedule 4, I am less clear about the very abstruse point which the noble Lord has made. Again, I shall have to write to him on that subject.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendments Nos. 82 to 85:


    Page 244, line 20, at end insert ("to the firm concerned").


    Page 245, line 14, leave out ("inform the firm concerned") and insert ("give written notice").


    Page 245, line 15, at end insert ("to the firm concerned").


    Page 245, line 39, leave out ("a person refused consent") and insert ("if the Authority decides to refuse consent, the firm concerned").

On Question, amendments agreed to.

Schedule 4 [Treaty Rights]:

Lord McIntosh of Haringey moved Amendments Nos. 86 to 92:


    Page 246, line 30, leave out paragraph 2 and insert--


("2. Once a Treaty firm which is seeking to carry on a regulated activity satisfies the conditions set out in paragraph 3(1), it qualifies for authorisation.").


    Page 247, line 20, leave out from beginning to second ("the") in line 22 and insert ("Sub-paragraph (1A) applies to a Treaty firm which--

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(a) qualifies for authorisation under this Schedule, but
(b) is not carrying on in the United Kingdom the regulated activity, or any of the regulated activities, which it has permission to carry on there.
(1A) At least seven days before it begins to carry on such a regulated activity, the firm must give").


    Page 247, line 23, at end insert--


("( ) If a Treaty firm to which sub-paragraph (1A) applies has given notice under that sub-paragraph, it need not give such a notice if it again becomes a firm to which that sub-paragraph applies.").


    Page 247, line 24, leave out (", (4)").


    Page 247, line 25, leave out ("(1)") and insert ("(1A)").


    Page 247, line 27, leave out ("the prohibition imposed by paragraph 5(1)") and insert ("paragraph 5(1A)").


    Page 247, line 33, leave out ("5(1)") and insert ("5(1A)").

On Question, amendments agreed to.

Clause 31 [Withdrawal of authorisation by the Authority]:

Lord Kingsland moved Amendment No. 93:


    Page 14, line 33, leave out ("This section applies") and insert ("A person ceases to be an authorised person").

The noble Lord said: My Lords, in moving this amendment I shall speak also to the other amendments in this group. Amendments Nos. 93 to 95 relate to Clause 31. The Minister will recall that these amendments were tabled in Committee. They remove what we believe is the unnecessary requirement for the authority to give a direction formally withdrawing a person's status as an authorised person. The Minister declined to accept the amendments on the basis that, in certain circumstances, they would make a person's status unclear. If my memory serves me correctly, he gave examples of EEA or treaty firms qualifying under Schedule 3 or Schedule 4.

Having reflected on the matter, we continue to believe that the amendments are justified. The formal withdrawal of a person's status as an authorised person is both unnecessary and confusing. In the case of an EEA or treaty firm, such a firm either qualifies for authorisation under Schedule 3 or Schedule 4 or it does not. If a firm qualifies, it is authorised for the purpose of the Bill under Clause 29(1). If it does not qualify, or ceases to qualify, it should not be, or should cease to be, an authorised person automatically. Therefore, the authority is not required to give a direction to that effect.

Take the case of an EEA firm that qualifies for authorisation under Schedule 3 and also has a Part IV permission. Assume that the Part IV permission is withdrawn and in the mean time the firm has ceased to qualify under Schedule 3. Under Clause 31 the authority has to give a direction withdrawing the person's status as an authorised person. Suppose the authority fails to do so for some reason. It seems that the firm continues to be authorised, when clearly it has ceased to qualify for authorisation.

That does not seem to be right. It would be both preferable and clearer to avoid the bureaucratic requirements of the direction and rely on the provisions of the Bill to determine whether or not the firm is authorised.

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I do not have sight of the correct paper. Perhaps I may ask the Minister whether Clause 42 is dealt with in this group.


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