In dealing with the Amendments to Amendment No. 31, I imagine that it would be necessary to refer to Amendment No. 31.

I would say. If Amendment No. 21 falls the Amendments to Amendment No. 31 fall and therefore they should be discussed now.

I beg to move Amendment No. 21, in page 6, line 15, after "may", to insert "by order".

The Minister of State was unwise enough to say earlier that he had not heard as much from me on Report as he had heard in Committee. I hastened to assure him that I would be on my feet and thereupon he hurried out of the Chamber, but he has now returned. I have become a creature of nocturnal habits recently and I find that I produce the most effective results during the hours of darkness, and as the sun is now setting I rise to my feet.

The Amendment deals with the problem of the machinery of divesting. I use the word "divesting" to cover all those powers which the Board of Trade is taking in subsection (5) to break up a monopoly if those powers appear to be the right remedy in relation to the facts found by the Commission. I was glad to hear reiterated the view from the Government that on the whole the divesting procedure will be preferable, where it is possible, to the price control procedure; but it is important that the divesting procedure should be, as I told the Committee, not only effective but fair. To quote briefly from a speech made in the Committee:

"The fundamental fact upon which everyone is agreed is that the Government must have the right to decide whether a divestment shall take place. What is in question is to ensure that the arrangements by which the divestment takes place shall be seen to be fair."—[OFFICIAL REPORT, Standing Committee E, 6th May, 1965, c. 301.]

That is a speech which the Minister without Portfolio will recognise came not from this side but from his hon. Friend the Member for Birkenhead (Mr. Dell) and it states succinctly exactly what this Amendment tries to achieve.

It will be remembered that in Committee I moved two Amendments to deal with these points which were in the alternative. One was to adopt the procedure of Section 206 of the Companies Act, 1948, and to invoke the Companies Court as the machinery whereby the divesting should take place. The other was to set up a special tribunal along the lines of the tribunal set up under the Coal Industry Nationalisation Act, 1946, to apportion compensation paid under that Act. In the event, the opinion, at any rate on this side, seemed to favour the use of the Companies Court and this is what the Amendment seeks to do.

In reply to a long and useful debate in Committee on this subject the Minister without Portfolio indicated the Government's thinking, which will require an Amendment to the Bill and we shall he coming to that Amendment later tonight. Although, as the Minister recognised in his brief intervention a moment ago, I shall have to refer to one or two points in the Government's Amendment they are alternative to the Amendment which we are now seeking to put forward.

9.15 p.m.

The short point is that it must be for the Government to decide, having received a Report from the Monopolies Commission, that an order should be made for splitting up a monopoly, that a divesting order should be made. The question is: how should that order be implemented? As was recognised on both sides of the Committee, very difficult and complex problems arise, involving the rights of, perhaps, a large number of parties, some of them members of the companies, some of them employees, some of them creditors, some of them persons with whom contracts have been made, and so on. A large number of rights have to be dealt with, and the purpose of the Amendment is to establish a procedure whereby these complex questions can be settled in a way which is fair to all the parties concerned and which is manifestly seen to be fair.

We propose adopting the procedure under Section 206 of the Companies Act whereby schemes of arrangement affecting the rights of participants in companies can be brought before the court and the court, if satisfied that they are fair and equitable, may sanction them. We felt that there was a sufficient degree of similarity between the schemes which often come before the Companies Court under Section 206 and the orders which would have to be made by the Board of Trade under this legislation to justify the use of that procedure or something akin to it in this case.

The advantages, briefly, are these. The judge in the Companies Court is someone who stands right apart from the parties. He is clearly impartial. He is in a position not to be concerned with the political question, which is bound to arise, of whether an order should be made, the broad lines on which it should be made, what should be divested, how the company should be split up, and so on. He will be in a position to adjust the rights and powers of all the parties so as effectively to carry into operation the order which the Board of Trade will have made, and at the same time, to do justice to all concerned.

The suggestion made by the Minister without Portfolio in Committee, which is embodied in the Government Amendment, does not use the Companies Court and it does not use an independent tribunal. It treats the whole question as an administrative one, and the matter is to be decided by the Board of Trade, although, I hasten to add, the Minister without Portfolio went on to say that he would envisage that, in certain circumstances, it might be right for the Department to employ the services of an expert in this subject, a member of the companies Bar or, perhaps, a senior accountant, who could be employed to advise the Department on the best method of carrying its intentions into effect. But, basically, the difference between the two sides of the House on this issue is that we favour a more formal procedure using the courts whereas the Government favour the more administrative procedure within the Board of Trade.

In reply to the Amendment which I moved in Committee, the Minister without Portfolio—I hope that I am not misleading the House or distorting his attitude—made five objections which he regarded as the major objections to our proposal. First, he said that the procedure under Section 206 of the Companies Act was not really analogous to the requirements under Clause 3(5); the two situations were really different in kind and, for that reason, it would not be right to import the Companies Act procedure for use in these circumstances.

Obviously, the situations are not exactly the same. Under the Companies Act, for the most part, schemes of arrangement are brought forward by the companies or by participants in the companies themselves, whereas under this legislation the schemes would need to be promoted by the Board of Trade in implementation of a decision to carry out the recommendations of the Monopolies Commission. To that extent there is a difference.

On the other hand, the nature of the operations that will have to be carried out dealing with the rights—this is the matter which engaged the attention of the Committee; it involves, to some extent, the right of debenture holders who have a floating charge on the assets of the company, the problem of dealing with different classes of shareholders who may have different rights either when the company is in operation or when it winds up, the problem of dealing with creditors who may have money secured on the assets of the company, the problem of dealing with people with contracts, employees and so on—these are all very similar to the problems which the Companies Court deals with under Section 206.

Therefore, if one looks at how the matter reaches the court, there is a difference. If one looks at the matters with which the court would be expected to deal, I suggest that they are very similar and that the judge in the Companies Court would find himself on very familiar ground. Therefore, I cannot accept the first objection which the Minister without Portfolio made to the suggestion.

The Minister's second point was one with which one is familiar in this legislation—namely, that the issues raised are not justiciable. That was argued out ad nauseam on the 1956 Restrictive Trade Practices Act. The hon. Gentleman argued that this is really an administrative matter. Is this so? Even if it were entirely an administrative matter, is not the nature of the Companies Court judge's jurisdiction more analogous to an administrative procedure than to something which is strictly justiciable? The judge has to make up his mind on the points of detail that arise when the scheme of arrangement is under consideration by the court, but the jurisdiction of the Companies Court is of the nature of an administrative procedure and smacks more of that than of a purely judicial procedure involving the normal processes of the courts.

The point about this, however, is that at some stage, and it may be at many stages, during the working out of the divesting order someone "will have to decide" The Minister without Portfolio will, no doubt, recognise those words for he uttered them three times during the debate in Committee. It is our contention that if someone has to decide, this is exactly the sort of matter which ought to be decided by one of Her Majesty's judges sitting in one of the ordinary courts of the land and not inside the Administration or one of the Departments of Government. Therefore, I submit that, so far as this is a justiciable issue, so far as it is a point which someone will have to decide, it is the courts and not the Government which ought to decide.

The third point made by the Minister without Portfolio was that the right place for this matter to be considered was the Floor of the House when the order is brought in, and that the court is the wrong place. We envisage two stages in this procedure. One is the decision that an order shall be made and the broad lines upon which the Board of Trade will expect the order to be carried into effect. That is clearly one for the Government and should require the approval of this House. The second stage, the detailed stage of implementing the order, is quite different. I submit that it is quite unsuitable for consideration on the Floor of the House.

One's imagination boggles at the suggestion that individual hon. Members, briefed, perhaps, by constituents who represent different interests in the company which is the subject matter of the order—some perhaps speaking for the preferential shareholder, others for the debenture shareholder and others for the creditors—should argue all the details of this on the Floor of the House when the order is brought up for approval. It would really be a fantastic procedure and I cannot imagine how it could possibly be an effective check upon the power of the Government to carry the order through.

In any event, I believe that I am right in saying that this House has no power to amend an order which comes before it for approval. It has power only to accept it or reject it. Presumably, if the order were so shot full of holes that the Government felt it required to be rewritten, the Minister in charge could withdraw it and we would have a second go at it but that would be a very unsatisfactory procedure. I cannot believe that this matter has been properly thought out by the Board of Trade and that it has seriously envisaged the problems that could arise on the Floor of the House in the event of an order of that kind coming before it in all its details.

Fourthly, I have collected a number of epithets that the Minister without Portfolio applied to the procedure we suggest. He said that it would be unnecessary, anomalous, expensive and undesirable and would cause delay and inconvenience. But it would be just, fair and open. It would give the opportunity to the company concerned, if it had serious points to raise, to put its case in open court and to be heard in public. It would be able to cross-examine and put arguments. In a matter of this sort, where substantial matters of private rights are affected, that is a better procedure than an inevitably somewhat secret administrative machine working behind closed doors.

Finally, the hon. Gentleman argued that there would be no equity in the Statute—I use the word "equity" in its technical sense—since the Government or somebody would have to tell the court, having imposed this duty upon it, how it would resolve that duty. I am quoting as nearly as I can from his words. But, with respect, he has now answered his own question. Without straying beyond the rules of order, I refer the hon. Gentleman to the Government Amendment No. 71, the new Schedule, which is entitled:

"Procedure preliminary to laying drafts of Orders referred to in section 3(10)(a) of this Act."

This is the Government's solution to the problem and the concluding words seem to me to express exactly the duty that should quite properly be placed upon the court in these circumstances when implementing the order which the Board of Trade has seen fit to introduce. The court should ensure, to use the words of the Schedule,

"… that the rights and interests of persons likely to be affected by the provisions of the order are so adjusted as to secure an equitable distribution of any burden or benefit ensuing from any provision of the order."

I cannot see the difficulty. If that duty were placed on the court, it would be perfectly clear.

I think that I have now listed all five of the major grounds upon which the Government sought to resist this Amendment in Committee. I hope that I have convinced the House that some of them have no foundation but that, where there are some grounds, those grounds are not sufficient to lead the House to reject the Amendment. The choice is clear. We on this side clearly prefer to see the matter, the detailed implementation of the order, brought before the court and argued out in open court where all the parties can put their point of view and where justice can be seen to be done. The Government's solution is to do it behind closed doors within the Department as part of the administrative machine. That, in our view, is unacceptable.

I have listened very carefully to what the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) has had to say about the Amendment, and I also listened very carefully, as the whole Committee did, to what he had to say at even greater length in Committee. I am bound to say that he has not added much by way of argument to what he said in Committee.

In his introductory remarks, quoting my hon. Friend the Member for Birkenhead (Mr. Dell), he posed what we all agree to be the question when he said that what was at issue was to ensure that the arrangements by which the divestment took place should be seen to be fair. The difference between the situation in Committee, and as it now appears, is that since the Committee stage, and very largely as a result of the protracted debate which we had then, my right hon. Friend the President of the Board of Trade has put forward a whole series of Amendments which go a very long way to meet the substance, though not the form, of the criticisms which were made in Committee.

I then gave a series of undertakings, all of which are implemented by the Government's Amendments, which we shall reach in a few moments. Those undertakings in effect were that the Government would put forward Amendments to this Clause which would, first, create a statutory obligation to publish a preliminary draft Order; secondly, to require the Board of Trade to give interested parties an opportunity to make representations before preparing the final draft of the Order to be made before Parliament; thirdly, requiring the Board of Trade to take account of those representations before preparing the final draft Order; finally, after further debate in Committee, I went further and gave the undertaking that we would also introduce an obligation that in the making of any Order for divestment regard should be had to the need for equitable adjustment of the rights of the parties. Those undertakings are now incorporated in Amendment No. 31 which is the paving Amendment for the new Schedule in Amendment No. 71.

As the hon. Gentleman has said, the simple issue between us is whether the detailed arrangements which will flow from any divestment Order should be left for adjudication in a court of law by some procedure similar to that which obtains under Section 206 of the Companies Act when a company is wound up, or when there is an amalgamation; or whether those details and complex arrangements, including not only the respective rights as between the various classes of shareholders, debenture holders, creditors and other contracting parties, should be left for settlement either by the Board of Trade itself, or by the Board of Trade in consultation with some eminent lawyer, chartered accountant or other expert qualified to deal with these matters, as will frequently be the case.

The hon. Gentleman keeps repeating that he would be happier if these matters were dealt with by a court of law and he says how important it is that there should be impartiality. I must remind the House that it is not only the courts which are capable of handling matters of this kind with impartiality, and that it is not the function of the courts to deal with complicated solutions on the basis of what is fair, as the Amendment would require. That is not the function of the court of law. Judges have repeatedly complained that it is not what they ought to be asked to do. There was an instance only the other day in the House of Lords when a Law Lord and an ex-Lord Chancellor pointed this out. It must be repeated in this House in answer to the Amendment of the hon. Gentleman the Member for Wanstead and Woodford

"The duty of Her Majesty's Judges is not merely to administer justice, but to administer justice according to the law. Those of us who have taken the judicial Oath will remember it; it for ever rings in our ears. It is to do right to all manner of men according to the laws and usages of this Realm, without fear or favour, affection or ill-will'—and that is what Her Majesty's Judges try to do."—[OFFICIAL REPORT, 11th May, 1965; House of Lords, Vol. 266, c. 21.]

It follows from that that this House ought not to impose upon Her Majesty's judges the obligation of resolving matters in dispute between citizens on the basis of what is fair without first laying down the principles which should apply. It is for Parliament to make laws and it is for the judges to administer those laws. If circumstances arise in monopoly legislation in which, as a result of a divestment order having to be made, somewhat complicated assessments have to be made between the respective interests of various parties, in a situation in which Parliament has not and cannot lay down any canon or yardstick which the judges should apply, it is not fair to ask those judges to discharge that function. It is placing upon them a burden which is unreasonable and contrary to the high judicial office which they serve. I have tried to make it plain in the Committee stage, and I repeat with emphasis that in my view it would be contrary to all principle and constitutional understanding and relationship between Parliament and the judiciary if that Amendment were accepted.

There is the necessity of making arrangements that are fair and equitable between the parties. That is what the Amendment of my right hon. Friend the President of the Board of Trade seeks to do. It goes far beyond the definition in the Opposition Amendment which is merely an injunction to Her Majesty's judges to do what is fair. That is something which I do not think ought to be imposed upon them. We have examined this matter at great length, and I thought that by putting down this series of Amendments we had ensured that the interested parties would not, as the Bill originally proposed, be faced with a draft order but that they would have ample opportunity of seeing a preliminary draft order advertised in the London Gazette and brought to their notice, followed by the opportunity of having consultations with the Board of Trade in which they could make representations. Over and above that there is the assurance that wherever necessary some expert on this subject will be called on to settle disputes. I would have thought that solution would have been more than enough to satisfy the Opposition that we wanted to meet their legitimate objections in the best possible way.

The hon. Member referred to five points which were dealt with in Committee. I have attempted to deal with all of them. For the reasons which I have given, I hope that these Amendments will be rejected.

I reject entirely the Minister's suggestion that the judges could not do this job. They have frequently to apply the principles of equity, which are fairly clear and are laid down in a very good book called Snell with which the Minister is undoubtedly familiar.

If the Minister cannot read the whole of Snell, I can refer him to Rivington's Epitome of Snell, of which the fifth edition was edited by the hon. Member for Wanstead and Woodford.

What is fair and equitable is not the length of the Chancellor's foot. It is laid down in various principles going back over hundreds of years. If we cannot find one of those principles, we are driven to such fundamental principles as equity is equality and all the other maxims which illustrate the good sense of the courts of equity since the days of Lord Chancellor Nottingham and before. I have no doubt that these principles will also be applied by the Board of Trade if the Minister has his way, because they are not something dreamt up and artificial but are fundamental to our ideas of justice.

The judges of the Companies Court are accustomed to applying these principles in matters dealing with a conflict of interest between different classes of contractors and different debtors, some of whom may have floating charges over the whole assets of a company to be divested and the question of where the floating charge shall fall in the case of divestment. I am sure that the Board of Trade will be obliged to apply these principles, subject to the advice of a distinguished lawyer or accountant, whoever it is the Minister wishes to bring in. The only question between us is whether it is to be done openly so that people can see and hear how it is done, or whether it is to be done secretly.

It seems to me far better that it should be done openly, because if somebody does not get his way, or if his submission is turned down, he will not go away with that sense of grievance which people always have, rightly or wrongly, and usually wrongly. If it is done secretly and by administrative order, people always think that they have been "got at" and that they have been unfairly treated, whereas if it is done in open court, where they can hear what the other parties say and meet it in public, they go away with a far less sense of grievance. The Minister knows this perfectly well. That is the point of administering justice in open court before a person who is totally independent of political pressure.

The principles which will be administered by the Board of Trade will be those which the judges administer. I am sure that it will do its best to be impartial and that most of the time, if not all of the time, it will succeed. The only residual complaint will be that people will not believe that it happens because they want to have their day in court. This is not one of those cases about which we often hear where people say, "But the courts are so expensive", because, ex hypothesi, a good deal of money will be at stake. They will not be cases in which there is a dispute under the National Health Act or the National Insurance Act on the part of people who cannot afford legal fees. A good deal of money will be in dispute, and therefore the expense of the proceedings before the Companies Court are not an issue.

The only issue is whether it is to be done openly and whether justice is not only done but seen to be done, because, as I say, the principles on which the Board of Trade acts will be exactly the same as the age-long principles on which the Companies Court acts and on which any court of law administering a system of equity has acted on for centuries.

The argument which I have heard on the Amendment seems to be very much the argument that was put many centuries ago over the Star Chamber Court, through which many of us pass when we come into the House every day. The Star Chamber Court probably dispensed as good justice as was carried out in the ordinary courts of the Realm, but it was carried out in secret and, therefore, the public had no confidence in it.

When we in this House pass legislation, we are not able to find whether it works in a just manner unless the cases that come before the court as a result of that legislation are dealt with in public so that we as Members of Parliament and people throughout the country can form a view of what is happening. For the Board of Trade to deal with these problems in secret—

The hon. Member is under a misapprehension. There is no question of secrecy. A draft scheme must be produced and published in the London Gazette. In the second stage, it must be laid before the House. There is no question of secrecy. All this will be done in broadest daylight.

With respect, it will not be done in daylight, because most of the arguments and submissions will be put before a body appointed by the Board of Trade. They will not take place in public. The only basis on which we get justice done is when all the submissions and counter-arguments on both sides are made in open court.

Judges are just as able to deal with these problems as anybody in the Board of Trade. I am certain that the House is taking a retrograde step in producing legislation which will not be operated in the full blaze of publicity of the realm. Therefore, because of these arguments, I support the Amendment.

The House will be glad to know that I intend to be short, as all my hon. Friends have been in our many debates on the Amendments today. I shall be short because there is still enough left for us to debate by the many hon. Members who have yet to follow to take us to the early hours—or perhaps I should say the late hours—of the morning and I do not want to keep the House too long. Furthermore, I realise that debates on what are sometimes rather technical matters which may take place in the small hours, even though relieved from time to time by Divisions, can be a little tedious and trying for the patience of hon. Members.

Thirdly, I intend to be short because the case has been deployed fully by my hon. Fr end the Member for Wanstead and Woodford (Mr. Patrick Jenkin), who deployed it with his usual brevity, cogency and eloquence. In Committee upstairs, he deployed the case at considerable and greater length, ably assisted by my hon. Friend the Member for Wokingham (Mr. van Straubenzee) to whom, with others of my hon. Friends, tribute was paid by the Minister without Portfolio. There is no doubt that in Committee my hon. Friends did a great service to the House by highlighting the problem that would arise if an Amendment such as we suggested was not incorporated in the Bill.

I agree that the Minister has done exactly as he promised to do. He has introduced an Amendment making it a statutory obligation to publish a preliminary

I beg to move, Amendment No. 23, in page 6, line 17, to leave out "or otherwise".

I suggest that with this Amendment the House should consider Amendment No. 52, in page 13, line 17 at the end to insert—

() Section 3 of the principal Act, as applied by section 6, shall have effect as if, in subsection (4), the reference to bodies corporate becoming interconnected bodies corporate included a reference to enterprises being brought under common control otherwise than by reason of their becoming enterprises of interconnected bodies corporate, and to enterprises ceasing to be carried on as mentioned in subsection (1) above, and, in subsection (5), the reference to the division of a trade or business as therein mentioned included a reference to the separation, by the sale of any part of any undertaking or assets concerned or other means, of enterprises which are under common control otherwise than by reason of their being enterprises of interconnected bodies corporate.

I am sure that it will be convenient to take the two Amendments together.

This is a short but not unimportant point which, owing to some muddle on both sides of the Committee, we were unfortunately unable to take in Committee. Clause 3(5) states that

"The Board may provide for the division of any trade or business by the sale of any part of the undertaking or assets or otherwise …"

The Board of Trade are therefore taking very wide powers. What have they in mind by the inclusion of the words "or otherwise"? Under which circumstances would it be necessary to provide

"for the division of any trade or business"

in any circumstances apart from

"the sale of any part of the undertaking or assets"?

Have the Board of Trade any examples in mind for which this sort of procedure, whatever it may be, would be appropriate?

I can imagine that under the subsection it would be possible for the Board of Trade—although I hope improbable—to divide any assets arbitrarily, alloting some assets to some and some to others. But I do not see how that could be done with the assets of a company. Presumably they would have to liquidate the company to sell the assets and split the proceeds among the people among whom they wished to divide the assets, in which case they would have provided for a division of the trade or business by the sale of any part of the undertaking.

I hope that the Minister of State will tell us under which circumstances he proposes to use the words "or otherwise", which are in a sense repeated in the Government's Amendment No. 52, which includes the words

"the division of a trade or business as therein mentioned included a reference to the separation, by the sale of any part of any undertaking or assets concerned or other means …"

That covers the same point.

The Clause as drafted gives the Government practically carte blanche as to how they treat assets in a company. No one should ever give any Government carte blanche, and certainly not this Government, and certainly not without finding out exactly what they have in mind. I can envisage no circumstances in which it would be possible to provide for the division of any such trade or business unless there were a sale of some part of the undertaking at some stage. I hope that the Minister of State will tell us why the words are in the Bill. Is it just a precaution for the remote future to deal with some obscure situation? What is the reason for the inclusion of these words?

As the hon. Member for Southend, West (Mr. Channon) said, this is a small point, although it could be important if one read into it the misgivings he appears to have. This is a cautionary suggestion, because if the Amendment were accepted the effect would be that the Board of Trade could provide for a trade or business to be divided only by the sale of its undertaking or its assets. This might operate, in certain circumstances, to the disadvantage of the parties concerned.

As the hon. Member knows, these are hypothetical matters at the moment, although we have looked back at previous monopoly examinations to see whether we are on firm ground. The probability we have in mind is where, for example, it might be more convenient for part of the undertaking or assets of a company to be transferred to another company in return for shares issued either to the first-named company or to its shareholders. Technically, this would not be a sale, but it would be excluded. It would be an arrangement which might be of great advantage to the parties concerned, because this would be better than selling off the assets. Therefore, to exclude the possibility from the Bill would, we think, be rather a mistake.

In most cases, where divestment is called for on a report from the Commission it would be obtained by a sale of the undertaking or part of the undertaking, or whatever it may be. But circumstances may arise where the example I have given would be of greater advantage to the persons concerned.

I find that a most puzzling reply, and I say that with respect to the Minister of State. What is the example which he gives of the transfer of assets in exchange for the issue of shares if it is not a sale? How does the nature of the consideration affect the basis of the transaction? However this matter is dealt with, at some stage there must be a sale. It might be possible, as my hon. Friend said, to envisage a case, to take a silly example, where a company is running two buses and it has been found to be monopolising a particular corner of the country. It has two shareholders, and the buses are to be divided between the two shareholders. Even that would have to be a sale. The company would be liquidated and the liquidator would sell the buses one to each shareholder. The authorities I have consulted on this matter cannot envisage any circumstances whereby a divesting under this subsection can take place without there being technically a sale; hence the Amendment to remove the words "or otherwise", and I remain utterly unconvinced by what the Minister of State has said in his reply.

I echo the misgivings which have been voiced by the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin). The example quoted by the Minister of State was a transfer for consideration. It is true that it was a transfer for shares, but for the valuable consideration which those shares represent. Surely that is nothing less than a sale. These words are surplusage, because the disposal of that part of the company which has been divested can be obtained eventually only through a sale. The Minister of State's reply was puzzling. I should like to be reassured.

I am glad that at last, since Second Reading, we have had some words from the Liberal Party.

There have been none before simply because no Liberal Member was put on the Standing Committee.

We have been discussing the Bill since 3.30 this afternoon. Subsection (5) says this:

"The Board may provide for the division of any trade or business by the sale of any part of the undertaking or assets or otherwise."

We have taken this to mean that the arrangement is for a straightforward sale. The situation I was describing would be more correctly described as an exchange of shares, which is not the same as a sale. Therefore the words "or otherwise" have been put in to cover that situation.

When I moved the Amendment my hon. Friends and I had imagined that there would be some simple explanation for the inclusion of these words. I find the Minister of State's explanation incomprehensible. I am fortified in this view by the support of the Liberal Party, which I did not expect to have. I cannot understand why the transfer of assets for shares should not be a sale, whereas the transfer of assets for money is a sale. I am no lawyer, but I am supported by two Queen's Counsel. My hon. Friends must have found the Minister of State's reply extremely unsatisfactory, one which has made them have worries about this part

I beg to move, Amendment No. 26, in page 6, line 43, to leave out from "above" to "the" in line 44.

The purpose of the Amendment is quite clear, like that of all our Amendments. It deletes the words

"or have the making of such an order under consideration".

We feel that it is wrong that the Board of Trade, only having the making of an order in mind, should be able to bring the activities of a company to a halt and to impose all the restrictions empowered under the Clause, including the power to control and supervise the company until such time as the Board decided whether or not it wished to make an order.

It is generally realised that it could be the cause of serious damage to a concern in that if the Board eventually decided not to proceed the concern would be unable to claim any compensation. We might have had a different view of the Clause if the Government had included a provision for compensation but they have not seen fit so to do. The reason for the insertion of the Clause, as I understand it and as the Minister of State confirmed in Committee, was to cover the possibility of a company, being subject to an adverse report by the Commission, attempting to forestall what it foresaw might be appropriate Board of Trade action. That, as I understand it, is really the reason why these words have been put in.

I suggested in Committee, and I suggest again now, that a Clause on the lines of Section 24 of the Iron and Steel Act, 1949, which dealt with the dissipation of assets by transactions involving payments, distributions and so forth to members of the company, might have met the point which the Minister had in mind, and I still think that a Clause on those lines might deal with the worry which the Government have. The Minister of State promised in Committee,

"… we will look at the matter again to make sure that action will be taken only on receipt of an adverse report from the Monopolies Commission. The Board of Trade will not lay art order to prohibit or restrict the doing of things which might impede the operations of a company".—[OFFICIAL REPORT, Standing Committee E, 6th May, 1965; c. 318.]

The Government have tabled Amendment No. 27, which we are discussing with this one, to insert the words:

"with a view to the achievement of that purpose".

That does not seem to make very much change.

Order. We are not discussing Amendment No. 27 at the moment.

I am sorry, Mr. Deputy-Speaker. I thought for a moment that we were debating the two together. However, it appears to me that the one relates to the other, and I am sure that the Minister takes the point I make.

Perhaps I may again use the analogy of matrimonial intention which I used in Committee. As the Clause now stands, if the Minister had marriage under consideration, he could under the powers given by the Clause not only prevent the lady of his choice from marrying anyone else but he could also anticipate all the things he might do if, in fact, he did enter into marriage. That is the position under the Clause as it stands before the Amendment which we shall come to later. If I may just mention that later proposal again without going out of order, it would enable the Minister to say to his intended bride, "Everything I do is with a view to the achievement of my purpose, which at the moment is matrimony".

The analogy is perfect but for one thing. If, having done his worst, the Minister did not marry, he could be sued for damages. Unfortunately, if the Board of Trade has done its worst to a company, has threatened an order and has taken action because it had the issuing of an order under consideration, and if the company is damaged thereby, there will be no claim to compensation of any kind. We do not regard the Government's Amendment as satisfactory. We consider that our Amendment No. 26, which I have moved, does precisely what we want to do. It removes the offending words, which we do not think should be there because they are inserted to provide against a possible contingency which can be covered in other ways.

For these reasons I hope that, even at this stage and after tabling their own Amendment, the Government will relent and be prepared to accept our Amendment in place of their own.

The hon. Member for Wycombe (Mr. John Hall) has reminded us that we discussed this matter at some length in Committee and I gave an undertaking that we would try to find a form of words to meet the legitimate concern then expressed. In a moment, I shall explain the difficulty we have had in seeking suitable words.

The hon. Member tried to use, both in Committee and today, the analogy of marriage to explain the point of view that he had in mind. But I think that a more accurate analogy would be divorce. The measures that the Board of Trade may well take will be to divest—to break up—rather than to amalgamate. As the subsection is drafted, it provides for the Board of Trade to make orders to prevent the frustration of an order breaking up the business or other appropriate action, not only where such a break-up order under subsection (5) has been made but also where the Board of Trade has the making of such an order under consideration, which I suggest is very different from saying "a break-up order which the Board of Trade has in mind". It is actively under consideration.

If these words were removed, the Board of Trade would not be able to act in anticipation of the breaking up order. We think it is important that the Board should have the power conferred by these words. First, the preparation of a breakup order under subsection (5), as I am sure the hon. Member for Reading (Mr. Peter Emery) would agree, might in certain circumstances take a considerable time. The proposed scheme might be complicated. As I am sure that both the hon. Member for Reading and the hon. Member for Wycombe would like us to express again the purpose here, lengthy discussions with the firms concerned will probably be necessary because one does not want to take arbitrary action where arbitrary action is not needed. If one can get agreement between the firms, so much the better. Again, the draft order would then be required to be laid before each House of Parliament and approved by Resolution. All this will take time. If the Board of Trade could not use the powers that are conferred by subsection (6) before an order for the purposes of subsection (5) was actually made, it might be possible for the persons concerned so to arrange their affairs as to render the operation of the expected break-up order unnecessarily difficult, if not impossible.

The matter, as I say, was discussed fully in Committee, and I undertook to see whether a form of words could be found which would make it quite clear that the Board would not use the power unless there had been an adverse report and the Board was bona fide contemplating the making of an order exercising the powers that are conferred by subsection (5). It is already clear that the power conferred by Clause 3(6) cannot be exercised unless there has been an adverse report. We have considered various ways of expressing this condition so as to indicate that the Board must be seriously and honestly considering the making of an order exercising the powers under subsection (5), and, short of imposing conditions which would, we think, deprive the power of most of its value, we cannot think of any words which express this intention better than the words which it is now proposed to delete.

The hon. Member for Wycombe both in Committee and a few moments ago suggested that the Board's position could be protected by a provision on the lines of Section 24 of the Iron and Steel Act, 1949. We think that there is not a true parallel here. That Section was aimed against the dissipation of assets by companies due to be nationalised, and prohibited the return of capital to members and similar transactions except with the approval of the Minister. We think that this is quite a different situation, where the Board of Trade on an adverse report from the Monopolies Commission is quite clearly contemplating a break-up order, but before the order is made all the circumstances that I have referred to—the discussions with the firms concerned, the laying of the order before both Houses of Parliament—inevitably lead to delay before the appropriate action is taken. I think that one has to ensure that the Board of Trade has powers to deal with any action that would frustrate the purposes which the Board has in mind on the recommendations of the Monopolies Commission.

Of course, we cannot foresee all the ways in which a company may set out to frustrate a divestment order once it suspects that one is to be made and therefore we cannot accept a limited power such as that suggested by the hon. Gentleman. But I make it clear again—and this is implicit in the Clause—that the Board of Trade could not possibly take action, using the power that the hon. Gentleman wants to omit, unless there had been an adverse report from the Monopolies Commission, because such an order could not be brought before Parliament unless there was clear justification for it.

I think that, on reflection, the hon. Gentleman will agree that, if the Board of Trade has to bring an order forward because of an adverse report of the Monopolies Commission, we should not allow anyone to take action that would frustrate the purpose of that order to their own advantage and against the public interest.

The hon. Gentleman will understand when I say that his argument is familiar and that it is really the one he deployed in Committee. I agree that my argument also, with some slight additions, is familiar. But the

I beg to move Amendment No. 27, in page 6, line 44, after "Board", to insert:

"with a view to the achievement of that purpose"

This is a clarifying Amendment. I am the first to admit that some legislation introduced into this House is capable of clarification. In this case, it was suggested in Committee that after the Board of Trade had made a divestment order, its powers of control over the companies concerned might, in accordance with the Bill, although this was not intended, have been totally unrestricted.

We never wished that they should be so unrestricted. They were merely intended to go as far as the control that was necessary for the proper carrying out of the order. The words which I now propose to introduce make that perfectly clear and beyond doubt, as, I think, the House would wish.

The Minister's explanation of the Amendment does nothing to remove my previous uneasiness in his refusing to accept our Amendment No. 26. As, however, one-eighth of a loaf is better than no bread, we do not propose to oppose the Amendment.

I beg to move, Amendment No. 28, in page 7, line 25, to leave out the second "directions" and to insert "order".

We can also discuss Amendments No. 29 and No. 30, in page 7, line 29, leave out "directions" and insert "order", and in line 35, leave out "vary or".

These three Amendments are, I am afraid, an exercise in biting the hand that feeds one, because in Committee the Minister without Portfolio drew attention to a matter which nobody had drawn attention to, and with characteristic candour and frankness he said that the powers contained in subsection (8) of the Clause were very unusual. He said they were.

"unusually wide powers which are not subject to Parliamentary control … I think it should be pointed out that if Parliament passes an order under subsection (10) containing those directions to individuals, those directions will not have to come before Parliament."

He gave one of the reasons:

"It may be undesirable that they should do so because it might give publicity to individuals who, in their own interest, would not wish their names to be mentioned."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 343–4.]

I see the reason he gave for a very remarkable example of sub-delegated legislation. As subsection (8) now stands, the Board of Trade may be authorised by an order which is subject to Parliamentary control to give directions to a person specified in the directions to take certain steps "within his competence" or

"to do or refrain from doing anything … specified or described which he might be required to do or refrain from doing".

In general, the directions which may be given and the persons who may be named are in very wide terms, and subject, as the Minister said, to no sort of Parliamentary control or indeed other control at all. On reflection, we have come to the conclusion that the reason he gave for this remarkable power is really insufficient, namely, that the person concerned would rather have these Draconian powers done secretly without publicity because otherwise publicity might be damaging. It might be damaging, but that is not sufficient reason to outweigh the usual constitutional arrangements which we have, which are that these things should be done quite openly and should be subject to some sort of Parliamentary control.

Therefore, what we suggest is that instead of a person being named only in the directions which are sub-delegated legislation he must be named and specified in the order, and also that the steps which the person named has to take must also be specified or described in the order. That is the effect of our Amendments, including the consequential one, the third, about varying the direction. We wish to delete the power to vary by direction. It is to be my means of revoking the order and making a new order which, again, would be under Parliamentary control.

I think the point is fairly clear. It is a constitutional matter. It is to try to remove the extraordinary nature of this sub-delegated legislation. Whatever the good intentions of the Minister without Portfolio—and I certainly see them and honour them—I do not think it right that these secret directions should be made with such little foundation as a general order not specifying the person to whom it is directed, not specifying the steps which that person has to take, in the only instrument which has Parliamentary control upon it. That is not a point which requires any elaboration.

I think that the House is grateful to the hon. and learned Member for Darwen (Mr. Fletcher-Cooke) for having put down these Amendments although, as he was kind enough to acknowledge, the Opposition cannot on this occasion claim any credit for the initiative. I am glad that the hon. and learned Gentleman has tabled them, because they give us an opportunity for a short while to discuss exactly what the subsection does. I think that before accepting it, and, as I hope, rejecting the Amendment for the reasons that I shall give, it is important to understand what is intended by the subsection.

I have considered whether the Amendments could be accepted, and I have come to the conclusion that they do not really either take away from the Board of Trade the power which the subsection is intended to give to it, or have the effect which the hon. and learned Gentleman contemplates they should have, or at any rate only in part.

It is the case that if an Order has to be made under subsection (5), that is to say a divesting order, it will, as a consequence of that, be necessary to ensure that it is properly enforced, otherwise it could be evaded and nullified. Therefore, if a divesting Order has to be made, it will become necessary for the Board of Trade to give directions to individuals to take certain steps. For example, if a divesting Order involves a company in selling its shares to another company, at some stage the directors and secretary of the company which is going to sell its shares will have to execute share transfers. If there is any difficulty about enforcing a divesting Order which, ex hypothesi at that time would have had the approval of Parliament, it follows that effect must be given to the wishes of Parliament. That may involve the Board of Trade giving directions to A, B and C that they shall execute certain documents, in the same way as the court has to have residual powers to see that its decrees are carried out.

Having reflected on this matter, I can see no escape from letting the Board of Trade have power by an Order, if approved by both Houses of Parliament, to direct unspecified and unnamed individuals, that is to say unspecified and unnamed in the Order, to do certain things. The reason why it is not possible, or perhaps desirable, to name the individuals in the order is not exclusively the reason that I gave in Committee. It may well be that it will not be possible, when the order is made, to identify the individuals to whom the directions have to be given. It may also be the case that if certain individuals are specified and given directions to do things evasive action could be taken, either by a company forming a subsidiary, or adopting one or other of the several devices which hon. Members know are open to those who manipulate companies, subsidiary companies, and associated companies, and such evasive action could defeat the intentions of Parliament.

Therefore, although, as I concede, and as I have pointed out, this is an unusual form of sub-delegated legislation, I can see no escape from it. My advice to the House is that, its attention having been drawn, with its eyes open, to what it is being asked to do, it is the only logical way of carrying out the intentions of Parliament.

11.0 p.m.

It might be said that that is all very well, but there must be some safeguard for seeing what the Board of Trade does. I have considered how that kind of objection can be met. There are two ways. It would always be open to any hon. Member to ask the President of the Board of Trade what directions had been given following an order made and approved by Parliament, and he could, I suppose, also be asked if he would place copies of any such directions in the Library. Although I cannot commit any President of the Board of Trade either now or in future as to what he might do, I indicate that as showing that there are methods whereby action taken in the way contemplated by this subsection could be made available to Members of Parliament. For these reasons and with this explanation I hope the hon. Member will feel satisfied that it would be impracticable to accept his Amendment.

Although we have had certain strictures from the hon. Member for Sheffield, Hillsborough (Mr. Darling), the House will appreciate that there was no Liberal on the Committee. Therefore, I crave the indulgence of the House if I should raise a point which might have been dealt with in Committee. From a constitutional point of view, is not what the Minister is saying that he can see the force of the argument of the hon. and learned Member for Darwen (Mr. Fletcher-Cooke), that Parliament should be able to question any particular order, but that it is difficult to make an order with any precision and with any certainty by naming the parties involved for the simple reason that it might not be all-embracing, that there might be certain persons who were operating certain practices to which the Board of Trade took objections but who might be omitted from the terms of an order specifically designating certain people?

But surely the contrary is of equal importance, namely, that when a Department of State makes an order specifying that certain practices shall or shall not be stopped, prevented or desisted from, there should be some measure of certainty and finality. What the right hon. and learned Gentleman is saying is that the net must be so wide that it may not only catch the fishes whom he wishes to catch but it may also pull in certain other sprats of whose existence at the time he is not fully cognisant. This seems a strange constitutional doctrine. Persons must know what the law is, and there must be finality and certainty. After all, this is one of the basic principles of the rule of law—that there is certainty and people know where they stand on a particular issue. This, as I see it, is the great argument against retrospective legislation, that a man may do something in good faith on the basis that it is intra vires only subsequently to find it has been retrospectively made ultra vires.

While one can appreciate the intricacy of this matter, and anyone who has seen the Monopolies Commission or the Restrictive Practices Court in action will know that complexity of these various company arrangements and various trade matters which are the subject of stricture and indeed of examination, I would urge on the Minister strongly that it is surely a bad principle to say that we must define offences so widely and vaguely that not only do we catch those whom we know are operating them, but also those who are operating but whose existence we do not know of at the moment, but whom we hope to get, notwithstanding that, in the net at the same time. I would have thought that was a novel constitutional doctrine which is certainly new as far as Ministerial directions are concerned.

I think the House is grateful to my hon. and learned friend for bringing this point to its attention and also to the hon. Member for Devon, North (Mr. Thorpe) for raising so many pertinent points. We have been twitted for not having raised that point on the Committee stage, but my hon. Friend the Member for Wycombe (Mr. John Hall) pointed out that the implication of this had not escaped us. I am glad that we have had an opportunity on Report of raising these important issues. The situation has not been left in a wholly satisfactory manner by the answers which we have obtained so far, and there are one or two further questions which I should like to put to the Minister without Portfolio.

First, is the power which he is taking in subsection (8) unprecedented or can he refer us to precedents of such action in the past? Our Amendment does not modify the powers which the Board of Trade would be able to take, but it gives some safeguards to persons who might be affected by such directions. The Board can pass an Order through the House empowering them to give directions to unspecified persons—to be specified only in the directions and not in the Order. What remedy lies open to the person specified in such a direction? My hon. and learned Friend earlier pointed out that someone might be specified in the directions in error or there might be a genuine mistake. What power does that person have to make representations and to have that obvious injustice remedied? The Board have enormous powers under the Clause. The House is right to examine the matter carefully before granting such powers to the Board of Trade and also right to question keenly the decision to use not only delegated legislation but sub-delegated legislation.

In Clause 3 the Board of Trade have power to regulate prices, to stop the acquisition or disposal of assets, to deal with the winding up of companies and the formation of companies, to declare certain practices illegal and to discriminate in any manner specified. The Board are taking a number of very important powers. We do not object; on the whole, they are excellent powers for the Board of Trade to take. But we consider that there should be some safeguards, and all that the Amendment does is to say that the Board of Trade should specify not in the direction but in the Order to which persons they are giving instructions or to the holder of which office.

The Minister told us that it was not always possible to identify certain individuals, and that it might be possible to evade such an Order. If it is impossible to identify them, will he explain how it is possible to bring them into the net by direction when it is not possible to bring them into the net by the Order?

In Committee he based his case largely on the ground that often it would not be in the interests of the people concerned to have these matters brought out into the open. A few moments ago he said that it would be open to any hon. Member to put down a Question to the Board of Trade asking which directions they had given, and he said that he might be asked to put copies of such directions in the Library. If that is so, very little secrecy is left. If hon. Members, and the public, can get this information any way, there is little safeguard for the people concerned if it is secrecy that they want. It is far more frank for the House to have this information laid down in the Order than to have it in a direction later, especially—unless the President of the Board of Trade refuses to do so—when any hon. Member may at any time ask the right hon. Gentleman to place the directions in the Library. If any President of the Board of Trade refused to place any directions in the Library which he had given based on an Order of the House, he would be open to wide criticism. Indeed, I hope that such a refusal would not occur.

For many years the Minister without Portfolio was a member of the Statutory Instruments Committee, and he knows full well what can be done by delegated legislation. At a time when the House has been criticised from both the Labour and the Liberal benches for not having sufficient control over the executive, this is one small battle in which we are entitled to ask the members of the executive to look again at what they propose. We are not asking for very much. We are asking that the Board of Trade should not wield wide powers and issue instructions which may affect many people and involve large sums of money, without the House knowing what the instructions are. At a time when we are told that the prestige of the House has never been lower, that the Executive rides rough-shod over us and that we have not the ability to control it, it is the duty of the Government to make sure that they do nothing further to increase this process if they believe it to exist.

We were told in Committee that it would be impossible to reveal people's names in certain conditions, but the Board of Trade takes powers to name the holders of offices. That is all the Board has to do, whether it does it by order or by direction. The Board can give directions not only to a named person but to a holder of an office for the time being in a company or association. The Minister without Portfolio raised a point along these lines. He said that it might be necessary in certain circumstances to give directions to directors of companies or secretaries to execute share transfers if it was necessary to sell certain shares. There is power in subsection (8) to make an order authorising the giving of directions to the holder of an office to do that, and I do not see what harm there would be for an order directing the secretary of a company to execute a share transfer to be laid before the House. That would be quite a proper matter to bring before the House in the ordinary way, subject to a Prayer if necessary. In most cases it would be unlikely that it would be prayed against. It would be a far greater safeguard than the safeguard of secrecy to which the Minister referred earlier.

We ought to allow this subsection to remain in its present form only if two conditions are satisfied; first, if it can definitely be shown that it must be in the public interest for such directions to be made, not subject to the scrutiny of this House; and secondly, if it is shown to be in the interest of the people concerned. However, I cannot see from the examples which the Minister has so far given that it would be in the public interest or in the interest of the people concerned.

I agree with the hon. Member for Devon, North about the necessity for certainty and finality. Our Amendment adequately meets that point. An order would have to be made. It would be certain and final. The Board of Trade would be able to make another Order if the first one proved insufficient, but that also would be subject to the scrutiny of this House. It would be far more satisfactory to all concerned if these matters could be brought out into the light of day rather than that wide powers should be taken by the Board of Trade.

I hope the Minister will be able to satisfy the House that these matters are in the public interest and in the interest of the people concerned. Without that assurance the Minister's case falls to the ground. If this subsection goes into the Bill in the terms in which it is drafted, it will be very necessary to watch this legislation extremely closely. I have no doubt that the Board of Trade will administer any such provision with the greatest possible care and with the greatest incentive to minimise injustice. Nevertheless, in a number of important particulars in this and other legislation we have been enlarging the powers of the Board of Trade considerably. The Board of Trade has enormous powers which are not subject to the scrutiny of this House. The House of Commons should assert its traditional right of being allowed to control the Executive and ensure that Orders that affect people, as Orders which are made under subsection (8) do, are subject to the scrutiny of the House.

I hope the Minister will realise that we on this side of the House support these Amendments in no party spirit but in a probing spirit, to discover the purpose of the subsection and to ascertain whether or not it is vital to the Bill that it should remain in its present form. I ask him, if there is any doubt whatsoever in his mind about the necessity of this provision, that he should give the benefit of the doubt to the House of Commons and not to the Executive. If there is any doubt whatsoever he should allow the House of Commons to scrutinise the orders in the ordinary way. I hope that we can be satisfied before we part from the Clause that the intention of the Government will be to protect the interests of the House of Commons in this.

11.15 p.m.

Far too often the House of Commons comes last as far as the Executive is concerned, and not first. The Minister without Portfolio is well known as a good House of Commons man, and this is a chance for him to show us this evening that he will take into account the genuine and legitimate interests of the House of Commons in considering this subsection of the Bill.

I am sure that everyone who has the interests of the House of Commons at heart must be very worried about the present situation under this Bill and will support the Amendment moved by my hon. Friend. The Minister has been Chairman of the Statutory Instruments Committee. I know that we ought to take a great deal of interest in Statutory Instruments. I am one of the few hon. Members who are here late at night when we are debating them. There are very few occasions when we divide the House on Statutory Instruments. Nevertheless, it is the last occasion when this House of Commons has any control over the Executive.

I do not understand how an Order can be produced, which the House of Commons can genuinely debate, when there is an instruction which is not part of the Order and which puts in information that is not being given to the House of Commons. If the Order is going to be put in the Library, there is not going to be much secrecy. If there is no secrecy, surely it is a far better system that the information given in the direction should be included in the Order. Taking the House of Commons to be a slightly lazy body, if these Orders are going to be properly debated, it is necessary that hon. Members should know from the Order what they are arguing about on the Order.

Whatever instruction there may be in the Library, the legislative effect is given by way of the Order before the House of Commons. The fact that there may be some instruction or further information in the Library or some other place does not really affect the problem of that sovereignty of this House.

How are we to agree to an Order, or disagree with it, if we have not got the information in the Order that will allow us to come to a proper conclusion? Is it going to say in the Order that secretary A will be ordered to do such and such thing, or director B to do such an such a thing? How is the House of Commons going to decide what hon. Members are being asked to do? The fact that we have this in some directive somewhere else is not, I think, relevant to the argument. If we are going to debate this in the House of Commons—and I do not agree with the view that all these Orders will be debated—this is an argument on a slack House of Commons.

If Orders are made that should not be made they obviously will be scrutinised, but I hope that some Orders will be made that are so obviously proper and just that the House of Commons will not feel it necessary to spend its time in debating them.

If my hon. Friend does not mind my saying so, my experience of Governments is that the cloudiest Order is the one which we should be debating and the Order which no one minds will be the soul of clarity. If we are not given the information on which to debate these Orders, the Executive is taking more powers and is reducing the power of the House of Commons. I ask that this matter should be looked at again. I am not now speaking as a Conservative but simply as a House of Commons man. The House is far too slack about Orders, but we cannot debate them unless we have the information on which to reach a conclusion. The Amendment would provide that information and it should be accepted. A very disrespectful attitude to the House is being shown.

I would echo the appeal of my hon. Friends the Members for Southend, West (Mr. Channon) and Ormskirk (Sir D. Glover) on behalf of the House and against the Executive. It is one thing for the Executive to take powers when we understand clearly what they are, but in the last Government Amendment powers were taken over matters which they have "under consideration". What those can be deemed to be could provide a great deal of room for legal argument. This time the words in the Clause are

"… to give directions to a person specified in the directions …"

I certainly could be fooled on what that means.

If the Executive proposes to take powers over all sorts of things which will be increasingly difficult to comprehend, the Executive must think again. The legal profession would be a great deal less lucrative if we saw to it that things put on the Statute Book were clearly indicated. It is unforgivable that with our eyes wide open we should put words of this kind in the Statute Book. They may be clear enough to legal luminaries, though I doubt whether they are clear even to them. The Minister without Portfolio must be more forthcoming in this matter.

I should like to clear up some of the points raised, with the leave of the House. I do not complain about the degree of attention given to this matter. It is not a party matter but, as has been said, a House of Commons question. I share the sentiments of hon. Members opposite that the House should be clear about what it is doing. I agree with them that it would be wrong for Parliament to give uncontrolled powers to the Board of Trade unless it is clear that they are necessary and in the public interest. Nobody wants the Board to have power to act arbitrarily or without full Parliamentary control. The only question here is whether it is necessary that the Clause should remain as at present drafted.

The hon. Member for Devon, North (Mr. Thorpe) will forgive me for saying that I do not think that he has fully appreciated what is involved in this matter. He did not have the advantage—it was not his fault—of taking part in the debates in Standing Committee. There is no question here of infringing the rule about finality or the rule against uncertainty. Both are not involved. Some of the sentences uttered by hon. Members opposite have magnified the danger which all of us think may be inherent here unless the matter is fully explained in the subsection.

The House should be clear as to the limited effect of the subsection. We are dealing simply and solely with the question of enforcement. There is no question of giving wide and diverse powers in a field in which there is not absolute certainty. We are dealing here with a situation in which there has been a report by the Monopolies Commission recommending the breaking up of a monopoly, the divesting by a monopoly of part of its assets. It is a situation in which Parliament has decided that a divestment—to use an unfortunate word—is necessary, and, therefore, an order has been brought to the House and approved by the House recommending that, in the public interest, a monopoly concern should part with some of its assets.

Pausing there, that means a disposal either to a purchaser or a competitor or to somebody who is prepared to take them over. All that must be assumed. We are dealing now with something quite novel and unprecedented in this country. There has never been the compulsory divesting of a monopoly interest. If such a situation arises, it will have been approved and have the blessing of Parliament.

Then comes the question of enforcement, and this is all we are concerned with here. How does Parliament give effect to its wish that a monopoly concern should transfer some of its assets? What is the practical method of doing it? It is no use just saying, "Please divest". Unless the wishes of Parliament are observed voluntarily, somebody must say to the directors and shareholders concerned, "You must sign such-and-such transfers of your shares", or "You must deal with such-and-such assets by transferring certain factories to somebody who will buy them". It is purely a question of enforcement. In order to give effect at that stage to the wishes of Parliament, directions have to be given to some individuals to do certain things. That is the whole object of the subsection.

All we are concerned with here is whether the Order containing those directions will have no effect unless it is approved by this House. The issue is whether an Order should give the Board of Trade power to say that A, B, C and D should do certain things or whether the order approved by Parliament should give a blanket authority to the Board of Trade to tell the people who are in the effective position to dispose of the assets that they should do so.

11.30 p.m.

The argument for giving the Board of Trade that power to give blanket directions to unspecified persons is merely this. It may not at that stage be possible to identify with precision the people to whom the directions must be given. They may, for example, be the directors of a company, in which case they may have resigned and, so far as shareholders in a company are concerned, they can transfer their shares to other persons. What one cannot face is a situation where the wishes of Parliament may be frustrated because, by various devices, steps are taken to prevent Parliament from giving effect to its wishes. That is the answer to the point that Parliament should give directions to the persons who are found to be the appropriate persons for carrying out the wishes of Parliament.

I assure hon. Members opposite that I have given a great deal of thought to this matter, and that I should not recommend what is here recommended were I not satisfied that there is no real invasion of the rights of the House of Commons or that it might be necessary, in certain contingencies, that the Order should contain the power to give blanket directions. The hon. Member for Southend, West (Mr. Channon) asked if an Order in these terms was unprecedented. It is not. I have straight away to admit that I cannot recall a specific instance, but as Chairman for some time of the Statutory Instruments Committee I can recall other cases where Parliament has conferred on the Executive powers not merely of delegated legislation, but also of sub-delegated legislation which did not require Parliamentary scrutiny.

The view has been expressed on both sides of the House that Parliament is very jealous of conferring those powers, and that they should not be conferred unless such a course is absolutely necessary. But there is the further safeguard that this debate, so far as it affects the relationship between Parliament and the Executive, will have had a salutary effect. Secondly, I assure the House that no order will be presented which contains this power of sub-delegated legislation unless, in any specific instance, it is required to be justified. Every time there is such an Order the circumstances will have to be specified, but unless subsection (8) is contained in the Bill it will be impossible for any Order under the earlier sections to contain this power of sub-delegation of legislation because, unless the Bill does so provide it, any such acts would always be ultra vires.

I have done my best, if I may say so with respect, to allay some of the exaggerated fears which have been expressed on this matter. I have given as complete an explanation as possible of why it is in the public interest that we should have this power and of how, in the last resort, the rights of this House are protected.

Could the Minister explain this point in order that the situation may be absolutely clear? Why must there be power for the Board of Trade to give a direction to the directors or the shareholders of a certain company so that action shall be taken by directive rather than by an Order under subsection (8)? Does the Minister not agree that he has power to give orders to holders of offices specified in this subsection?

Yes, but if my right hon. Friend is to rely on an Order each time for getting Parliamentary approval, then there is opportunity for evasion, because if the order specifies individuals it may well be found, as I have already pointed out, that they are no longer holders of offices and are, therefore, without the powers. Another Order would have to be made. Unless there is the power to give directions to unspecified persons, then the Order must specify the persons to whom the directions have to be given. There might very well then be frustration of the will of Parliament.

I am sorry to press the hon. Gentleman again. He can give directions not only to persons but to holders of offices. If his argument is that one may make an Order concerning a Mr. Jones, a director or a company, but he may resign and a Mr. Brown may become a director, the hon. Gentleman can make an Order directing the directors of a company. No matter if they change, they are still bound by the Order. So why is it so necessary to do it by direction and not by Order?

To give one example, the company might form a subsidiary and transfer all its assets to it, and so it would be the directors of another subsidiary.

From what the Minister without Portfolio has said, I am slightly less unhappy than I was at the beginning of the debate. He has admitted one thing, that there is a possibility that these directions will not be secret. This is very important. He drew a parallel with the enforcement powers of the courts—for example, the giving of injunctions or the making of decrees for specific defaults. I accept that. But these orders are public and people dealing with injuncted persons do so at their peril. Indeed, it adds to the force of the enforcement that it should be public. I should like the Board of Trade directions to be public for the same reason.

We now know that they are to be public to the extent that they may be placed in the Library. This is some advance. We feared that the directions would be directed secretly so that the public would not know about them and there would be no way of complaining about them. I still do not quite understand why a subsequent Order in the proper sense of the word cannot be made and laid. Nevertheless, we have got somewhere. As the Minister said, the debate itself will have done some good. Furthermore, it would be most ungracious to divide the House when the whole debate was, in fact, provoked by the Minister without Portfolio originally. For this, among other reasons, I beg to ask leave to withdraw the Amendment.

I beg to move, That further consideration of the Bill, as amended, be now adjourned.

I move this Motion largely to ascertain the Government's intentions. The House will agree that we have made good progress up to now. The speeches from this side have been short and to the point. [Laughter.] Hon. Gentlemen seem to treat that remark with levity. But it is true. A perusal of HANSARD will show that the speeches from this side have been short and to the point, have been most constructive in character and have added a great deal to the development of the Bill. The speeches from the Government side have been even shorter both in time and in number. We have had two interesting but short interventions from the Liberal benches.

It is unfortunate that the burden of improving the Bill has fallen largely on the shoulders of my hon. Friends here and in Committee. But I stress that we have not wasted any time throughout the debates in our consideration of the Bill, and that is generally acknowledged. Nevertheless, there are some very important Amendments to follow, as Ministers will agree. If my Motion is not accepted, we shall debate some important Amendments to Clause 4 which cover matters of considerable substance, and, what is even more important, as we get towards the end of the Bill, to Clause 8, which at the present rate of progress is likely to be between four and five o'clock in the morning, we shall debate matters affecting the press, matters of very considerable importance indeed about which there is considerable feeling. I merely ask whether it is wise to deal with these very important matters in the early hours when none of us are at our best, when perhaps we cannot give the attention that we should to them and when, unfortunately, fatigue tends to make us go on much longer in saying things that we could say more shortly if we were fresher.

For these reasons, amongst others, there is a Motion on the Order Paper signed by about 50 hon. Members opposite deploring all-night sittings and pointing out that it is not easy to give proper attention to matters of importance in the early hours. One may have different views on this, but that is the strong opinion on the benches opposite.

In these circumstances, if my Motion cannot be accepted, perhaps the President of the Board of Trade will at least let us know his intentions. Are we to go on until we have completed consideration of the Bill, including Third Reading, which might take us to a very late hour tomorrow?

I agree that we made excellent progress in a constructive spirit—indeed, such good progress that we should continue. So far as I can see, hon. Members not merely on this side but opposite are still in full possession of their faculties and will continue to be for a long time yet. Everybody is awake, and we even have the Liberal Party with us.

We all believe in higher productivity and the full use of productive assets all round the clock in industry. Since we are doing so well in such a co-operative spirit, and as there are expressions of alertness on all our faces, we clearly should continue.

I must confess that I did not expect any other answer, but I would point out that we have been in debate now for eight hours. During that time, we have disposed of 31 Amendments at the rate of about one every 15 minutes, which is quite good progress. At that rate of progress, however, the remaining Amendments will take another ten or eleven hours to discuss. Then we are to have Third Reading.

We on this side have always been prepared to sit here all night and during tomorrow as well. As the right hon. Gentleman has pointed out, all the vigour is on this side. We are all alert and all our faculties are alive. We are full of eagerness and vim and are likely to maintain our energy until any hour he cares to mention.

It was the expressions of dismay by hon. Members opposite in their Motion that led me to move my Motion. However, if the right hon. Gentleman is determined to push on we are quite prepared to do so. But I warn him that this will be a long night. I beg to ask leave to withdraw the Motion.

I beg to move Amendment No. 32, in page 8, line 35, at end to insert:

Provided that this subsection shall not have effect until the Board have made an order setting out a list of the treaties concerned.

I suggest that, at the same time, we also consider Amendments Nos. 34 and 35 in the name of the hon. Member for Wycombe (Mr. John Hall) and the names of his hon. Friends—in page 9, line 2, at end insert:

"and which is included in Schedule (Treaties) to this Act."

In page 9, line 2, at end insert:

(5) The Board shall have power by order to add or vary the list of treaties set out in Schedule (Treaties) to this Act.

—and the new Schedule—"Treaties", also standing in the name of the hon. Member for Wycombe.

That would be convenient, Mr. Speaker.

I am obliged to the President of the Board of Trade for assuring me that I still look as if I am in possession of my faculties. I will do my best to justify his confidence.

We now arrive at Clause 4, which gives certain powers to the Board to exercise the very considerable powers in Clause 3 if there has been or is likely to be a breach of a treaty. When we discussed this in Committee a number of my hon. Friends were concerned to know how anyone would have the opportunity of appreciating what treaty it was they were likely to breach. It was because we did not then feel we had been given an adequate reply to the arguments put forward that this composite series of Amendments has been put on the Order Paper for our consideration. What they do, in brief, is to provide that there is added to the Bill a Schedule specifying, initially, two treaties which are the ones at point at the moment, and ensure that the necessary flexibility is given for those to be added to and for the powers contained in Clause 4 only to come into force when the Board has made an order setting out the list of treaties concerned. That summarises the effect of Clause 4 as it would be if this series of Amendments was accepted.

There was a great deal of probing upstairs to try to find out what was in the President's mind. The point was most succinctly put by the hon. Gentleman the Minister of State of 11th May, 1965, when he said:

"On the points raised by the hon. Member for Wycombe (Mr. John Hall), the appropriate part of Clause 4(1) is about half-way through, where it says that when the Commission makes a report the Board of Trade may take action where something 'has been or is likely to be a breach or a conflict of the Treaty'."

He went on:

"Now the only two treaties with which we are really concerned in this regard are the E.F.T.A. Convention and G.A.T.T. Therefore, where action is required so that we honour our E.F.T.A. obligations, I think it is, although perhaps not as clearly stated as the hon. Member for Wycombe would like, implicit in this Clause that we are referring to a treaty of this kind. We do not want to spell it out too clearly, for the reason given by the hon. Member for Reading (Mr. Peter Emery) that there may be other treaties in the future."

That is what he said when hon. Member's on this side of the Committee were probing as to what was in his mind. This point was followed closely by my hon. Friend the Member for Worthing (Mr. Higgins), with his usual pertinacity. It might be a fair summary to say that he said he was not satisfied that these were the only two treaties and although he may explain it himself later I got the impression that he, and other hon. Members, were questioning in their minds whether there might be treaties additional to those but which were not known to the House.

I am able, after carefully reading the reports of our meetings in Committee, to set at rest the anxieties of any hon. Member who thinks there is some kind of secret treaty in this matter, for the Minister of State was quite explicit. In col. 363 this is what he said:

"These are not secret treaties. All the trade agreements that Great Britain has entered into are available for public inspection."

The Minister was quite emphatic, definite and clear. To summarise, he made it plain that there were only two treaties that he had in mind and that those treaties were E.F.T.A. and G.A.T.T.

It is for that reason that we seek to place in the Bill precisely those two treaties by way of scheduling them. I am hopeful that the necessary time for reflection having passed, the Minister of State will now see how helpful it would be to all concerned if there was absolute certainty on this point.

"Absolute certainty" picks up the discussion which took place on the last Amendment. I do not need to dwell on it at length, particularly at this hour, but the Minister of State will recall that on both sides it was agreed that it was a duty of this House, wherever possible, to make the state of the law clear to those who might be affected by it. I do not believe that the matter could be more clearly put than it was put in Committee by my hon. Friend the Member for Worthing at col. 359. With my hon. Friend's consent, I should like to repeat what he said:

"I think that the fundamental point which we ought to make is that if business men are to be subject to the provisions of the Bill when it becomes an Act because the actions which they are taking are in conflict with some treaty, they are entitled to know where they stand. It would be unfair if, because of treaties which had been signed in the past, or which may be signed in the future, a business man, who perhaps unwittingly was in conflict with one of those treaties, suddenly found that the Board of Trade was able to take action against him on the basis of this Clause."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 351, 363, 359.]

I thought then, and I certainly think now, that that placed the argument in a nutshell.

In Clause 4, we are taking extended powers relating to possible breaches of treaty. There is nothing in the Bill to say what those treaties are. It is surely inherent in our method of dealing with those who are affected by our legislation that we should make it as clear as we can what the law is and what it is that business men, who might possibly breach a treaty, have to avoid and what are the rocks that they must watch out for in the channels ahead.

I have sought to show that, on the Minister's own words, he has only two treaties in mind. Those are the two treaties listed in the new Schedule. I have sought to show that fears and anxieties that there might be other treaties are, on the Minister's own words, not justified. I genuinely believe that the argument stands without any further difficulty or elaboration and I am confident that after mature thought in the period that has since elapsed, the Minister will feel able to accept our Amendments.

I support my hon. Friend the Member for Wokingham (Mr. van Straubenzee), who has so adequately and cogently proposed the Amendment. There are, however, one or two other points which should be brought to the attention of the House, more particularly because this matter was not covered in any detail on Second Reading. Indeed, I am rather uncertain whether it was even mentioned.

When we were in Committee upstairs, it became apparent that the Government's proposals in Clause 4 were extremely important—I described them at the time as something of a Trojan horse—because they introduced into our monopolies legislation what appeared to be the beginnings of international monopolies legislation in that they endeavoured to incorporate into the domestic law of the country arrangements whereby treaties which we had signed with other countries could be given effect. To this extent it was an extremely important Clause.

Most of my hon. Friends would agree with me when I say that it would be desirable, if it were found that these monopolies were in conflict with one of our treaty obligations, that they should be subject to the sanctions set out in this Bill. Therefore, there is no basic disagreement between the two sides of the House, I believe, on this point. Where we do find very considerable disagreement is on the question of which treaties in particular we are concerned with in this Clause. It is for this reason that my hon. Friends have tabled the Amendments we are discussing.

Before I turn to the detail of them there is one point I should be glad if the Minister of State would clarify. He mentioned in Committee that the Clause was to implement the obligations we had in particular with E.F.T.A. We asked at the time if there were reciprocal arrangements, similar to those in the Bill, in the other E.F.T.A. countries. He was unable to answer at the time. I hope that, in the light of the discussion which we had, he will be able to give us some more positive answer than he gave us on that occasion.

I turn to the Amendments. The first point which needs to be made clear is that, in spite of what my hon. Friend the Member for Wokingham has said, one feels, if one reads through the speeches of the Minister of State, that there is considerable doubt whether he was merely referring to the E.F.T.A. treaty and the General Agreement on Tariffs and Trade or whether he had some wider scope in mind. I agree with my hon. Friend that there is no question of any secret treaties being involved, but that the question is which treaties in particular are to be covered by the Clause. It is for that reason we have suggested we should specify in detail which treaties are covered. The best the Minister of State could do by way of reply, when we queried this first of all, was to say:

"We were advised that those were the words which ought to be used in this connection to cover all the trade treaties which this country has entered into. …"

This seems to me to be wider than a reference merely to E.F.T.A. and G.A.T.T. Therefore, I think it is important that we should pursue this matter this evening in the whole House.

The second point which must be made, and should be made very strongly, is that in the debates in Committee it was suggested that somehow if we were to specify the treaties precisely this might encourage certain countries overseas to protest about what British firms were doing, and the implication of this seemed to be—and it was not contradicted—that there might be British firms in conflict with our treaty obligations and the Minister was desirous of omitting from the Bill a list of treaties in order to protect them from such complaints. This seems to me a totally wrong attitude for any Minister in this country to adopt when considering the treaties into which we have entered and an honourable obligation.

The second point which he made appeared to be that there was no need to specify precisely what the treaties were because business men need not know with which treaties they might be in conflict. This, again, as my hon. Friend said, seems to us to be totally wrong, because it means that business men may find themselves suddenly subject to sanctions of the Bill without knowing in advance that they would be subject to them.

12 m.

One of the extraordinary things which emerged in the debates in Committee was, that the hon. Gentleman suggested that the action of the Government might be directed against firms which were going to be caught by the Clause as it now stands. The hon. Gentleman said:

"It may be that after the Bill has become law this will be one of the first references to the Monopolies Commission, and it would be improper, for a number of reasons, to mention the case this morning."

Are we to understand from that that we are going to omit from the Bill any specific reference to certain treaties other than those which we specify, and we are then going to find that when the Bill becomes an Act the Government are proposing to take action against a company which the Minister of State or his colleagues have in mind, and in this way they will catch the company? That is a wrong attitude for the Government to adopt in this matter, and I hope that by accepting one or other of the Amendments the hon. Gentleman will remove any doubt from the minds of hon. Members on both sides of the House about the Government adopting an irresponsible attitude of this kind.

There seems no reason why we should not specify in the Bill the actual treaties which are concerned. The hon. Gentleman tended to excuse this with the words:

"I am also advised that it was technically difficult, and perhaps not altogether in the public interest, for the whole list of trade treaties and agreements which we have entered into to be published as a Schedule to the Bill …"

Later on he said:

"I know that that is an unsatisfactory answer, but it is the answer that we have to give to the hon. Gentleman, and I hope that it will be accepted by the Committee."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 360–1.]

Whether or not it was accepted by the Committee, I very much hope that the same unsatisfactory answer will not be accepted by hon. Members tonight, because to say, "I am sorry it is an unsatisfactory answer, but I hope that it will be accepted" is not really the kind of intellectual approach that we expect from the hon. Gentleman, and I hope, therefore, that he will have no hesitation in accepting the Amendments.

The hon. Gentleman will observe that the Amendments are in two forms. The first is that the Clause shall not have effect until such time as the Board of Trade has specified what treaties it has in mind, and the alternative is that we should accept the Schedule which we have added. When we discussed the matter in Committee, it was not possible for the Amendment covering the Schedule to be called, for the rather good reason that we had omitted to put down the Schedule. We have now managed to cover that particular point, and so the Schedule now reads that the two treaties concerned are those which the hon. Gentleman, during most of his speeches upstairs, seemed to say were in his mind, namely, the E.F.T.A. Treaty, and the G.A.T.T.

If the hon. Gentleman accepts the Amendments, it will still be possible to add to the Schedule any further treaties which he feels he would like to cover. We think that this is a matter which ought to be clarified. We agree with the general principles of the Clause, but we think that it is vitally important that business men should know where they stand in operating within this legislation, and I therefore have great pleasure in supporting the Amendments.

I do not have much to say on this Amendment which has been moved so admirably by my hon. Friend the Member for Wokingham (Mr. van Straubenzee) and supported with his usual clarity by my hon. Friend the Member for Worthing (Mr. Higgins), but it is important that we should press this matter because the Government did not give an exact undertaking in Committee upstairs. The Minister of State intervened on more than one occasion during our discussions on this topic, and I tried to put forward some alternatives in an effort to help the hon. Gentleman.

It is a nonsense of the most extreme sort that a business may find itself suddenly, when this Bill becomes an Act, subject to the regulations of treaties entered into and unspecified by the Bill, and then suddenly find that because of the rest of Clause 4, line 32 to 36, that where

"there has been or is likely to be a breach of or conflict with a treaty, then, for the purposes of remedying or preventing that breach or conflict, the Board may by order exercise all or any of the powers conferred by section 3(2) and (3) of this Act."

Looking in Section 3(2) and (3), we see the whole panoply of powers even down to the price regulation in paragraph (3) which it would be open for the Board of Trade to take. If any Government, whatever its political structure, is to be given the power to take this action with industry, then industry must surely, in common decency and ordinary reasonable understanding of a logical or business approach, have the right to know what these treaties are they could be breaking. As I said in Committee, and I think it is worth repeating, this is much more difficult for the smaller firms. Large firms have staffs in the export market. They have legal departments that are completely au fait with what is going on in international trade. It may well be expected that they will know and possibly cope with this present situation.

But it is not true of the medium entrepeneur, the small business in the Midlands, the small engineering firm, particularly in Reading, my own constituency, where they are attempting to assist in the export drive and indeed are probably over-stretched on their capital resources and staff resources at the moment. They certainly would not have legal departments who would be examining or considering this particular aspect of the Bill.

Therefore, I believe that if one looks at the statement by the Minister of State and mentioned by my hon. Friend the Member for Wokingham:

"These are not secret treaties. All the trade agreements that Great Britain has entered into are available for public inspection."

As long as that is true, and we have no reason to doubt that the Minister would say anything but what is the case, then indeed there can be no reason for not accepting our Amendment. We have the Schedule there. It will be within the power of the Government to add whatever treaties they want to the Schedule. There are two treaties down at the moment, and the Government would have powers to add to these treaties if they saw fit. Therefore, I hope that they can accept the Amendment. If they cannot, and I would want strong reasons to be given why they could not, would they then accept and give an assurance on the question that I asked during the Committee stage.

"Could any company wishing to have a list of all the treaties affecting the operation of the Bill and the regulations obtain this list by application to the Board of Trade? If we could have that understanding, anybody wishing to have such a list could obtain it without any difficulty, although it would not be written into the Bill"—[OFFICIAL REPORT, Standing Committee E, llth May 1965, c. 364.]

We were given a partial assurance. If the Government cannot accept the Amendment, they should state categorically that a firm has this right to go to the Board of Trade and automatically to be provided with a list of the treaties. That is not the best way to deal with the matter; it is a bad second or third best. Someone who picks up the Bill for the first time will not have seen this assurance and will not know of the Board of Trade's intentions in this respect. I therefore urge the Minister to accept the Amendment, which would assist industry in the operation of the Bill.

The hon. Member for Worthing (Mr. Higgins) said that in Committee I said that I knew that "this was an unsatisfactory answer". After a series of interjections and speeches I tried to say, "I know that this answer will be unsatisfactory to hon. Members opposite"; but I am willing to accept the Report as it appears. I give the hon. Member the assurance that the other E.F.T.A. countries have either introduced similar provisions, or are in the process of doing so, and there would be the reciprocal arrangements about which he asked.

All hon. Members who have spoken have quoted from my speeches in Committee. Added together the quotations have been at some length. One quotation, which is germane, has not been made. I said that we were concerned in the discussion with E.F.T.A. and G.A.T.T., but I continued,

"… there are a number of other treaties and trade agreements which come within the definition, which we decided on after full consideration, and a treaty means 'any agreement with a country outside the United Kingdom or the government of such a country, or with any international organisation or authority, being an agreement binding on Her Majesty's Government in the United Kingdom.' We were advised that those were the words which ought to be used in this connection to cover all the trade treaties which this country has entered into, and is likely to enter into, where action as proposed in subsection (1) might be called for to deal with the trade practices of firms which offend against international treaties and agreements."

We are concerned only with firms which have thus offended. I continued,

"I am also advised that it was technically difficult, and perhaps not altogether in the public interest, for the whole list of trade treaties and agreements which we have entered into to be published as a Schedule to the Bill in the way suggested by the hon. Gentleman."—[OFFICIAL REPORT, Standing Committee E, 11th May, 1965; c. 360.]

We have gone into the matter very carefully. We shall have to stick to this definition, because the Bill refers to trade treaties; and to give a full list would mean a very long Schedule indeed. I am not altogether convinced that it would be helpful even to larger firms, and I do not think that it would be helpful to smaller firms merely to have a long list of the treaties. But I give the hon. Member for Reading (Mr. Peter Emery) the assurance for which he asked, that any exporter or person engaged in overseas trade who wants a list of the treaties may have it. But I hope that the Board of Trade will go much further than giving the applicant the list. What the Board of Trade has to do is to give advice and information on the content of treaties. The Board of Trade must ask the circumstances of the firm, and inquire why it wants the information and what the Board can do to help. The reason for the inquiry may be that the firm feels that it is on the verge of doing something which would be contrary to the terms of the treaty to which the United Kingdom is a party. So the function of the Board of Trade is to give advice—not a list of treaties.

12.15 a.m.

Therefore, for the reasons given in Committee and with the assurance that I have given that the Board of Trade will give all the help possible to people engaged in overseas trade who want information about agreements—not just titles but the content and other helpful information—I hope the hon. Gentleman will withdraw the Amendment.

I do not wish to speak again, but before the hon. Gentleman sits down I want to ask a question. The Minister has said that there is this very long list. We accept that. We are not arguing about that. But I cannot see the difficulty, if this long list exists, between a long list being provided in private and a long list being provided in a Schedule to the Bill. It will save the Board of Trade a lot of trouble if this list is put into the Bill. It seems a complete nonsense to suggest that it is difficult to put a long list into a Schedule to the Bill but that it is easy for the Board of Trade to provide the list. Could the Minister comment on that statement?

I had better repeat what was said in our Committee proceedings, reported at column 360 of the Report. I said that I was advised that it was not only technically difficult, but perhaps not altogether in the public interest, to publish the full list.

In spite of his usual courteous approach, I am afraid that the Minister of State has not satisfied those of us on this side of the House who raised the matter. I realise that he repeated the arguments reported in column 360, which naturally we carefully reread before approaching this discussion, but, as my hon. Friend the Member for Reading (Mr. Peter Emery) pointed out, all the trade agreements that Great Britain has entered into are available for public inspection.

There is considerable anxiety on this side of the House about the effect of this upon innocent businessmen and exporters—

On a point of order, Mr. Deputy-Speaker. We are not in Committee and the hon. Gentleman has already addressed the House. If we are to have much more of this we shall be here nest week and not merely this morning.

In reply to the hon. Gentleman's point of order, the hon. Gentleman who is addressing the House moved the Amendment, and, although we are on Report, the hon. Gentleman who moves an Amendment is in order in replying to the debate.

I am much obliged, Mr. Deputy-Speaker. I generally find myself politely and correctly slapped down by the Chair, and it is for me a refreshing experience to discover that I am in order.

I was about to say that I appreciate that the Minister of State has made two short advances in our direction. The first is this very helpful point about the reciprocity of the other E.F.T.A. countries, which will be welcomed by my hon. Friend the Member for Worthing (Mr. Higgins) who has gone into this point. Secondly, there is the clear assurance that the Board of Trade will make lists of these treaties available, and the advice that goes with them. I understand that the Minister of State has put that forward to the Committee in a genuine spirit and in a desire to help us in the difficulty that we have expressed.

There is, fortunately, another opportunity and another place for this point to be considered further. Speaking for myself, I think we would like to reflect rather more fully on the implications of some of the things that the Minister has said, because I realise that these matters are not as easy of solution as they might appear.

On that understanding, I beg to ask leave to withdraw the Amendment.

I beg to move Amendment No. 33, in page 8, line 40, leave out from "be" to end of line 42 and to insert:

"laid before Parliament after being made, and, if the order is not approved by resolution of each House of Parliament within the twenty-eight days beginning with that on which it is made, the order shall cease to have effect (but without prejudice to anything previously done thereunder).

In reckoning any such period of twenty-eight days, no account shall be taken of any time during which Parliament is dissolved or prorogued, or during which both Houses are adjourned for more than four days".

This Amendment changes the procedure under Clause 4 dealing with Orders to honour treaty obligations. Orders that may be made for this purpose are those provided for in Clause 3(2) and Clause 3(3), but not the power to prohibit acquisition provided for in Clause 3(4) and any related powers provided in Clause 3(5) and Clause 3(6).

The Bill as introduced provided for such Orders to be subject to a merely negative Resolution procedure. The Amendment, which I am sure will be accepted by hon. Members on the Opposition side with gratitude, substitutes for this that the Orders should require affirmative Resolution of each House of Parliament within 28 days of making the Order. The 28 days procedure is quite common with Orders of this kind. It means that they come into effect because of the need for speed. But unless they have Parliamentary approval within 28 days they lapse.

This of course is that procedure which that Bill already lays down for similar Orders. Under Clause 4, when Orders are made on that basis of that Monopolies Commission report that a monopoly or merger may operate, or operate in part, against that public interest, we think that adequate publicity must be given to the situation in which an Order under Clause 4 may have been passed.

The affirmative Resolution procedure means that there can, in all cases, be a Parliamentary debate when the Order is made. In preparation for that debate publicity will be given, and I hope that this change, which was more or less what was suggested in Committee, will have the approval of the House.

Although I personally had a little difficulty in following the Minister at the beginning of his speech because he was reading his brief at great speed, nevertheless I have got the gist of what is intended. I can assure him that we do welcome the Amendment. It is an improvement and we shall certainly support it.

I beg to move Amendment No. 36, in page 9, line 37, to leave out "either".

Mr. Speaker proposed that we take with this Amendment,

The purpose of these Amendments is to delete subsection (1,b,ii) and take out of the Bill the power to refer to the Commission proposed mergers which involve taking over assets exceeding £5 million. When these Amendments were debated in Committee there was strong support for them from the Government side and the several speeches included those by the hon. Member for Ashton-under-Lyne (Mr. Sheldon) and the hon. Member for Heywood and Royton (Mr. Barnett). The speeches impressed the Government. The Minister without Portfolio admitted that the figure of £5 million was purely arbitrary and he agreed that there would be considerable difficulty under the Bill as drafted in arriving at the value of the assets. He said that he would consider with the President of the Board of Trade whether the reference should be deleted or the provisions modified.

To quote his words:

"I am bound to say that I appreciate, as I think everybody does, the profound difficulties about attempting to explain whether the £5 million figure should be judged on the basis of book values or any other values. Admittedly the figure of £5 million is a completely arbitrary one. Having chosen an arbitrary figure, one appreciates the difficulty of arriving at any scientific basis for determining whether the assets are there or not. I would like to suggest that if the hon. Member for Wycombe would withdraw the Amendment my hon. Friend and I will consider with the President of the Board of Trade, in the light of everything that has been said this morning, what course we ought to propose, either by deleting it or substituting something else or modifying the provisions."—[OFFICIAL REPORT, Standing Committee E, 13th May, 1965; c. 422.]

Unfortunately, nothing seems to have come out of these deliberations. This is extremely regrettable, but I am not entirely surprised.

In the circumstances, perhaps one ought to rehearse some of the arguments again. The inclusion of £5 million seems to argue that in some way monopoly is associated with size and size with monopoly. This tends to create the impression that bigness means badness. I am sure that that is not the impression which the Government intended to convey. It would be quite wrong to create that impression.

One of the anomalies which can be created by this provision can be illustrated quite simply. A £6 million company which decided to take over a company with £4 million or £4½ million assets would not be affected and subject to possible reference under the Clause. If however, and this is quite a possibility, a live energetic company with a capital of £4 million or less took over a larger company with assets of £6 million it could be referred under the conditions of the Clause although the resulting assets would be precisely the same in each case.

The definition of the assets is a difficult problem. If it is taken, as apparently it is, according to the definition in the Bill, as the nominal book value this will create a number of problems. Everybody knows that the book value of assets has very little relation to the real value. It might be that in some companies, anticipating the possible effects of the Finance Bill, the book value might have some relation to the actual value, but in many cases we know that book value does not hold any such relationship to the true value.

12.30 a.m.

There is also the danger of holding up desirable mergers because they might be referred on grounds of size. It has been said that it is not the Government's intention to discourage mergers which may well be desirable in the interests of the economy and the efficiency of industry, and some mergers the Government might even wish to encourage if they had the power so to do. But a company wishing to take over another one or more companies, with assets in excess of £5 million, might find its affairs referred by the Board of Trade, and this could have the effect of discouraging a possible merger. I should regard this as an undesirable consequence.

It emerged from the debate in Committee that one of the reasons behind the insertion of the reference to assets of £5 million was the desire to protect companies which might be unwilling parties which, like brides carried screaming to the altar, did not want to be absorbed by another company. One has had cases of this kind in this country in recent years, especially with bids coming from overseas, in which there has been considerable controversy and sometimes the necessity for the Government to intervene or lake an interest. If it is thought necessary to protect companies which may not be willing to be taken over, this is not the proper place for providing that protection. It would be much more appropriate in the Companies Act. We have had the Report of the Jenkins Committee, and I imagine that the Government will, if they can find time, introduce some amending companies legislation arising out of that Report. The Companies Act is a far better place for provisions designed to protect companies subject to take-over bids to which they object. This Bill is not the right place for it.

The Government used another argument. On Second Reading—his words are reported in column 1333 of HANSARD—the Minister of State said that the sheer power of the giant could give rise to a monopoly situation. Although a company, already a large one, perhaps, taking over another company with assets in excess of £5 million might not, even after that absorption, itself create a monopoly or be the subject of formal action under the Bill, it could nevertheless, by the mere size of the concern, almost create a monopoly position. Examples were given to substantiate that argument. It was said that not only would the size tend to stifle competition but the empire created might be too large for the most efficient use of resources. This was another argument used in support of the idea of investigating the absorption of companies on the ground of size.

The argument that the empire created might be too large for the most efficient use of resources is a strange one to come from right hon. and hon. Members opposite who, by and large, were the creators of the nationalised industries. Are they saying that the creation of large empires of the size of the nationalised industries leads to the inefficient use of resources? If so, I might be tempted to agree, because we have had evidence showing that this is so in many cases. But to use that argument in support of the inclusion in the Bill of the figure of £5 million is to stretch the point a little too far.

There is no point in this provision. It has almost been admitted that there is little point in it. It is a figure snatched out of the air. In a pamphlet produced by certain distinguished colleagues on this side of the House a rather smaller figure was mentioned. I think that £1½ million was given as the possible figure which might be taken into account in the case of a proposed merger.

Of course, it is well to remember that this proposal was made against a quite different background; the background which envisaged the establishment of a Registrar, and, even so, I should not necessarily have agreed with the recommendation in that pamphlet, distinguished though the writers of it may have been. This is an arbitrarily chosen figure and mere size has no relation in practice to a position of monopoly at all.

I do not want to deploy these arguments at any great length, because I am certain that the President of the Board of Trade has heard of them. I am sure he has read of the debates upstairs and knows all the arguments and, having been seized of them upstairs, and the Minister of State having gone so far as to say that he will endeavour to get round the point we are making, will he, although there is at present no Amendment meeting our point, say that he will consider introducing a suitable Amendment to the Bill in another place?

I will be very brief and should not have intervened at all were I not so bitterly disappointed that the Government insist on sticking to this stupid criterion as a basis for bringing a merger under scrutiny. That the mere matter of size should prompt an investigation, when no question of market domination comes into the issue at all, is something one cannot understand. This is totally wrong and wholly irrelevant to any of the problems with which we are faced today. It has nothing at all to do with modernisation, or efficiency, or making this country more progressive.

It is just old-fashioned suspicion of business—commercial enterprise—in all its forms in general, and of big business in particular. It is very sad to see a Government which professes to be dedicated to the modernisation of the national economy clinging to such out-dated dogma. One can only describe the President in the words that Mr. Harold Wincott uses when he particularly dislikes someone, as "an elderly left-wing parrot".

It is a very sad moment when we come to consider as the criterion for the purpose under discussion a business which is said to be of great size because it has assets of £5 million. What on earth does the President of the Board of Trade mean by assets? Does he mean book value? Does he mean the market value of the assets as quoted on the Stock Exchange? Does he mean the real value of the assets? If that is what he means, then how will he calculate the real assets? Will it be before depreciation; after depreciation?

The whole of this Bill so far has had a very fair hearing both in the Committee and in the House and so far we have dealt with serious eventualities. Now, we are lost in the mists of sheer prejudice. I will not speak more than I can avoid of the prejudice which must be inherent in this proposal, but will try to show how utterly impracticable it is. We have already had a debate on the place of the nationalised industries in relation to the Bill, and whether they should be included in its provisions. During the Second Reading debate he said:

"There could be cases where monopoly in this sense is not technically involved, but, nevertheless, the concentration of economic power would be such that the transaction should at least come within the field of public scrutiny."—[OFFICIAL REPORT, 29th March, 1965; Vol. 709, c. 1213.]

This is the kind of ludicrous defence which the right hon. Gentleman was anxious to make.

If that is so, how can the nationalised industries be excluded from the purview of the Clause? The right hon. Gentleman's memory has already been refreshed by the words of the present Prime Minister on 22nd April, 1948, when he said that if, for instance, the National Coal Board were to make mining machinery, it would be possible to have such activities brought before the Commission.

Order. I hope that the hon. Gentleman will not repeat a debate on which we have already taken a decision.

I move quickly to my next point, Mr. Deputy-Speaker.

At the very time when we are encountering more and more opposition in other countries, particularly Common Market countries, when we are seeing the French positively encouraging mergers, we have this absurd provision. Last week the Americans announced the results of a competition to join the "Billionaire Club", something which I would have thought was very dear to the heart of the hon. Member for Buckingham (Mr. Maxwell). They produced evidence that there are now 69 members of the New York Stock Exchange "Billionaire Club"—companies with annual sales or revenues of 1,000 million dollars or more. Such companies in the United States are pleased to be big. What is wrong with size anyway? Why should we be so pathetic about it? It is time the other side of the House grew up and realised that we are living in a big world. This is not the age of the cottage industry. What does the right hon. Gentleman want to do? Why does he not fragment industry into tiny parts or bring us back into the world—

Is the hon. Gentleman aware that the requirement of the Bill in respect of large businesses with assets worth £5 million or more does not imply that the Board of Trade would refuse such a merger? All it means is that the Board of Trade will have an opportunity to make sure that such a merger takes place in the national interest. Also, whereas in the past people used to get knighted for the kind of things for which the Americans send their businessmen to gaol—I do not think that our Bill has gone quite that far—has not the time come for our businessmen to realise that there is such a thing as the national interest on the question of mergers?

On the second point, I do not know to which aspect the hon. Gentleman is directing himself—gaol or knighthood. But he has not made any point of substance.

The right hon. Gentleman and all hon. Members opposite must grow up and realise that we are in a world of increasing competition and increasing size of concerns. I am very glad to see the hon. Member for Heywood and Royton (Mr. Barnett) entering the Chamber. I know his views on this subject, and I very much hope that he will voice them during this debate.

This is a lamentable procedure. It means ultimately that the President of the Board of Trade wants us to return to a sort of Jean Jacques Rousseau existence, a cottage industry existence, with La Nouvelle Heloise in person sitting on the Government Front Bench. That is the kind of thing that we are faced with. The President of the Board of Trade and, no doubt, the Minister of Public Building and Works will be constructing "Le petit Hameau" again in this country to make little cottage industries.

On a point of order. Mr. Deputy-Speaker. Is it in order for an hon. Member to use a foreign language in this debate?

I was almost inclined to intervene to translate what the hon. Member for Horsham (Mr. Hordern) was saying. He has, however, so far merely mentioned the titles of one or two French books and the name of part of Versailles. So far he is in order.

I am obliged, Mr. Deputy-Speaker, and I am about to conclude. I am flattered that you should recognise my expressions and place them so accurately.

I am in despair in trying to allude to something reasonable and sensible in these late 1960s. We are in a competitive world and it is high time that the Government woke up to realise what an absurd notion they are trying to put into what is otherwise a very respectable and important Bill.

Like my hon. Friends, I feel strongly on this matter, but unlike them I make no apology for speaking at length. I would have no qualms about speaking at great length on the subject. The President of the Board of Trade has been kind enough to say that we look alert, vigorous and fresh. I would expend every ounce of vigour and alertness on the discussion of the Clause and I hope that the right hon. Gentleman will take as much time as he wishes in expounding the arguments in support of the Government's proposal to keep the figure of £5 million in the Bill.

This is one of the most important provisions of the Bill. It is perhaps unfortunate that we are taking it at this hour but as we are let us deal with it with the emphasis its importance demands. It is one of the new departures in the Bill compared with the principal Act. It is a departure with which I have not a great deal of sympathy. Because the Government's arguments in support of it have been sketchy and because I dislike it so much. I have endeavoured to examine carefully and in detail just what has been said by hon. Members opposite in support of the proposal.

On Second Reading, the right hon. Gentleman dealt with this in the most general terms. In answer to a query from my right hon. Friend the Member for Bexley (Mr. Heath) he said that it applied to foreign firms with the same provisions, in effect, that it would to firms in this country. But in Committee I think that it was denied that this was the underlying reason for the figure.

Perhaps a case could be made out for this if it were to give control or some sort of supervision over take overs by foreign firms but apparently that is not the main underlying reason. It is therefore only incidental that the proposal applies to this kind of take over. The right hon. Gentleman, on Second Reading, referred to the "size of assets" concept. I have looked in vain for any development of this concept of the danger, presumably, of the size of assets. We must adjust our minds to changing values. Not only are units getting bigger but, regrettably, money values are changing. The figure of £5 million these days is comparatively small.

There is another point which cannot commend this proposal to us—the use of the word "arbitrary". My hon. Friend the Member for Wycombe (Mr. John Hall) has referred to its use in Committee by the Minister without Portfolio. It was also used by the Minister of State on Second Reading in replying to the debate. I would like to quote what he said in full but, in order to reassure you, Mr. Deputy Speaker, after my early remarks, comparatively briefly. The hon. Gentleman said:

"The figure of £5 million is arbitrary; we accept that. We went through the list of mergers over the last five years and did a little separating of the sheep from the goats. It seemed that £5 million was a very satisfactory figure where the merger did not lead to a monopoly situation."—[OFFICIAL REPORT, 29th March, 1965; Vol. 709, c. 1333.]

I emphasise that last sentence. May I ask the President of the Board of Trade, if he is going to reply, a very satisfactory figure in relation to what? This is what puzzles us on this side of the House. What is it that this figure is as satisfactory in relation to? It can only be that it is at this sort of figure that inhibitions against size begin to operate on the other side of the House. If this is the case, then I certainly am waiting to be persuaded on this. But this has not been advanced in explicit terms, despite the fact that it is one of the major new provisions in the monopoly legislation in the Bill.

We come again to the reply of the Minister without Portfolio in Committee, to which I would draw the attention of the President of the Board of Trade. This was one of the major debates in Committee and it was given one of the briefest replies from the Government Front Bench of almost any discussion that took place. The Minister without Portfolio wound up by saying:

"… the Minister of State and I feel we should have an opportunity before attempting to answer this debate, to consult the President of the Board of Trade on everything that has been said this morning, to see whether any other course ought to be taken to deal with this subject."—[OFFICIAL REPORT, Standing Committee E, 13th May, 1965; c. 421.]

I want to convince the House that I am not laying undue emphasis upon this point. I would draw the attention of the President of the Board of Trade to the fact that his own side expressed the most direct doubts about giving support to this Clause. The comments of the hon. Gentleman the Member for Ashton-under-Lyne (Mr. Sheldon) in Committee have just been referred to. I was looking for the arguments in support of this proposal and I happened by chance to read the speech of the hon. Gentleman the Member for Ashton-under-Lyne on Second Reading. I felt able, after reading it, to say that should we reach Third Reading tonight I might be able to condense some of my remarks by referring to what he said then. He spoke most explicitly on this and so did other hon. Members on his side.

I would, therefore, ask the President of the Board of Trade to give us a full explanation in support of this Clause in the Bill which, up to now, the House have been denied. I assure him we shall not grudge him one moment of the time and we shall listen with very great interest to what he says. Unless some arguments are produced which are clearer and stronger than have been produced, I certainly will feel that this Clause will do far more damage than good and that this figure is so arbitrary as almost to have been plucked from the air because someone felt that somewhere there should be reference to size, otherwise a lot of dearly-held shibboleths were going to be abandoned, and this would cause grief in certain quarters.