FIFTH REPORT |
By the Select Committee appointed to report whether
the provisions of any bill inappropriately delegate legislative
power, or whether they subject the exercise of legislative power
to an inappropriate degree of parliamentary scrutiny; to report
on documents laid before Parliament under section 3(3) of the
Deregulation and Contracting Out Act 1994 and on draft orders
laid under section 1(4) of that Act; and to perform, in respect
of such documents and orders, the functions performed in respect
of other instruments by the Joint Committee on Statutory Instruments.
Electronic Communications Bill
1. This bill was the subject of pre-legislative
scrutiny by the Trade and Industry Committee of the House of Commons.
That Committee was concerned that Parliament should be able to
review any decision to bring into force Part I of the bill. That
Part is unusual because it has been presented to Parliament on
the basis that it will be needed only if self-regulation in the
industry is seen to fail. Hence the unusual commencement provision
in clause 15 which repeals Part I at the end of five years from
Royal Assent unless an order has been made bringing Part I into
force (though the order could specify a commencement date after
the end of the five year period).
2. What concerned the Trade and Industry Committee
was that the Government's decision that self-regulation had failed
could not be effectively challenged in Parliament. Once a commencement
order had been made, the process was irreversible - Part I took
effect and regulations under it would be needed and the bill provides
only negative procedure for those. Their report commented that
they would await with interest this Committee's report on these
The Government was challenged on this at Committee Stage in the
Commons but did not give way.
3. The department's memorandum explains the background
to the bill and discusses the delegated powers. In addition this
Committee invited oral evidence from officials of the Department
of Trade and Industry. The transcript of this evidence is printed
with the report.
4. Clause 4 protects certain information obtained
under Part I, sets out the purposes for which it may be disclosed
and makes improper disclosure a criminal offence. Clause 4(2)(c)
allows regulations to permit the disclosure of information for
the purpose of facilitating the carrying out of prescribed functions
of any prescribed person. As the explanatory notes make clear,
"there is no restriction on who may make the disclosure or
to whom it may be made, provided that the purpose is proper."
The Department's explanatory memorandum explains that "there
will be circumstances where information, which should otherwise
remain confidential, needs to be disclosed - for example, to other
regulators. It seems likely that companies from different sectors
... and trade associations may apply for approval and it may be
necessary to ensure that information is available from and to
statutory regulators of those other sectors."
5. Clause 4(2)(c) is potentially a very wide-ranging
power in an area where information is otherwise confidential.
In oral evidence officials from the Department of Trade and Industry
said that they had concerns about limiting the power to statutory
regulators because of the need to comply with European legislation
and the need to communicate with voluntary regulators. Nevertheless,
the Committee believes that the power, as currently drafted, is
unacceptably wide. The House may wish to consider amending the
bill to restrict the power in a way which clearly limits it to
information needed for regulatory and other public functions.
6. Clause 5 contains a power to make regulations
subject to negative procedure which prescribe the matters to be
"prescribed" under other clauses (see clauses 2(3)(a)
and (b), (4) and (8) and 4(2)(a) and (c)). The Committee sees
these as similar to those commonly left to delegated legislation
subject to negative procedure. However, in the light of the
sensitive area in which the powers in Part I will operate the
House may wish to consider amending the bill so that on the first
occasion that regulations are made under this power they are subject
to affirmative procedure.
7. There is an "affirmative" power
in clause 3(5) but the Committee considers that it is justified
in the memorandum and does not call for further comment.
COMMENCEMENT PROVISIONS FOR PART I
8. Normally commencement provisions are not subject
to parliamentary control. But the provision in this bill is highly
unusual, because the bill sees self-regulation as the best course.
So an order to bring Part I of the bill into force would be a
particularly important decision, going against the preference
9. The Committee considered carefully the
concerns expressed in the Commons. The original draft bill apparently
simply provided for statutory regulation of cryptography service
providers and it was the House of Commons Trade and Industry Committee
which persuaded the Government to accept that the statutory regulation
should be used only if self-regulation failed. The Committee consider
that Parliament must have some control over the decision as to
whether self-regulation has failed. Having discussed this in oral
evidence with officials from the Department of Trade and Industry
we recommend that the House may wish to consider amending the
bill to provide that Part I is to take effect only if brought
into force by an order which has been approved in draft by both
10. There is a very wide power in clause 8 to
"modify legislation" for the purpose of "authorising
or facilitating the use of electronic communications or electronic
storage". The scope of the power is made clearer in the detail
of the clause which is extended by clause 9(5) and (6). An order
under clause 8 may be made by affirmative or negative procedure
(clause 9(3) and (4)) and the memorandum explains that it is intended
to make the first order by affirmative procedure.
11. Clause 8 can operate across a potentially
wide range of legislation, as the explanatory memorandum admits.
It "relates to enactments passed after the enactment of the
Bill, as well as those passed before, and the Government is not
able to identify the statutes which currently require the actions
specified in subsection (2) and which could or should be amended."
Moreover, the power could also be used to amend enactments and
instruments which already make provision for electronic communications
12. The power in clause 8 may bite on enactments
which have hardly been dreamt of, let alone reaching the light
of the long parliamentary day. Were the use of this power not
circumscribed on the face of the bill the Committee would have
had to conclude that this was an inappropriate delegation of power.
Fortunately the power is limited, in the following ways:
- an order cannot require use of the electronic
means: it can only provide for an electronic means alongside the
- it is only enactments and instruments which call
for the doing of something listed in subsection (2) which can
- the purpose of the order must be to authorise
or facilitate the use of electronic communications or storage
instead of the conventional alternative,
- the appropriate Minister must consider that records
of things done using electronic communications or storage are
no less satisfactory than are required if conventional alternatives
13. In oral evidence officials from the Department
of Trade and Industry explained that the Government intends to
table an amendment to clause 8 to make sure that the clause works
in the same way when an order facilitates electronic communication
or data storage as when the order authorises such communication
14. While there must be concern about the
wide-ranging situations to which this power could be applied,
the Committee is satisfied that the purpose for which the secondary
legislation can be used is circumscribed on the face of the bill.
Furthermore, the memorandum gives an explanation of the need for
proceeding in this way which the Committee finds convincing.
15. The Committee noted that clause 13 prohibits
ministers using their powers under the bill "to impose a
requirement on any person to deposit a key for electronic data
with another person". This clause removes concerns which
had been expressed and so makes more acceptable the delegated
powers in the bill.
16. The Committee has made the following recommendations:
- Clause 4(2)(c) is potentially a very wide-ranging
power in an area where information is otherwise confidential.
The House may wish to consider amending the bill to restrict the
power in a way which clearly limits it to information needed for
regulatory and other public functions.
- In the light of the sensitive area in which
the powers in Part I will operate the House may wish to consider
amending the bill so that on the first occasion that regulations
are made under the power in Clause 5 they are subject to affirmative
- Parliament must have some control over the
decision as to whether self-regulation has failed. The House may
wish to consider amending the bill to provide that Part I is to
take effect only if brought into force by an order which has been
approved in draft by both Houses.
17. There is nothing else in the bill which the
Committee wishes to draw to the attention of the House.
1 14th Report, session 1998-99, Draft Electronic
Communications Bill (HC 862). Back
Paragraph 50 of the Trade and Industry Committee's Report. Back
Paragraph 36 of the explanatory notes. Back
Paragraph 12 of the explanatory memorandum. Back
Paragraph 18 of the explanatory memorandum. Back
This report is also published on the Internet at the House of
Lords Select Committee Home Page (http://www.parliament.uk), where
further information about the work of the Committee is also available. Back