Delegated Legislation Committee
DRAFT GENERAL FOOD HYGIENE (AMENDMENT) (EU EXIT) REGULATIONS 2019 DRAFT CONTAMINANTS IN FOOD (AMENDMENT) (EU EXIT) REGULATIONS 2019 DRAFT SPECIFIC FOOD HYGIENE (AMENDMENT ETC.) (EU EXIT) REGULATIONS 2019 DRAFT GENERAL FOOD LAW (AMENDMENT ETC.) (EU EXIT) REGULATIONS 2019
The Committee consisted of the following Members:
Chair: Siobhain McDonagh
† Abrahams, Debbie (Oldham East and Saddleworth) (Lab)
† Brine, Steve (Parliamentary Under-Secretary of State for Health and Social Care)
† Burghart, Alex (Brentwood and Ongar) (Con)
† Chalk, Alex (Cheltenham) (Con)
† Clarke, Mr Simon (Middlesbrough South and East Cleveland) (Con)
† Coyle, Neil (Bermondsey and Old Southwark) (Lab)
† Debbonaire, Thangam (Bristol West) (Lab)
† Fellows, Marion (Motherwell and Wishaw) (SNP)
† Fitzpatrick, Jim (Poplar and Limehouse) (Lab)
† Flint, Caroline (Don Valley) (Lab)
† Hodgson, Mrs Sharon (Washington and Sunderland West) (Lab)
† Mackinlay, Craig (South Thanet) (Con)
† Menzies, Mark (Fylde) (Con)
† Morris, David (Morecambe and Lunesdale) (Con)
† Morton, Wendy (Aldridge-Brownhills) (Con)
† Norris, Alex (Nottingham North) (Lab/Co-op)
† Scully, Paul (Sutton and Cheam) (Con)
Kenneth Fox, Committee Clerk
† attended the Committee
Twelfth Delegated Legislation Committee
Tuesday 5 March 2019
[Siobhain McDonagh in the Chair]
Draft General Food Hygiene (Amendment) (EU Exit) Regulations 2019
For the avoidance of doubt, gentlemen may remove their jackets. As it is the Committee’s wish to take the instruments together, I will call the Minister to move the first motion and speak to all four instruments. At the end of the debate I will put the Question on the first motion and then ask the Minister to move the remaining motions formally.
I beg to move,
That the Committee has considered the draft General Food Hygiene (Amendment) (EU Exit) Regulations 2019.
With this it will be convenient to discuss the draft Contaminants in Food (Amendment) (EU Exit) Regulations 2019, the draft Specific Food Hygiene (Amendment etc.) (EU Exit) Regulations 2019 and the draft General Food Law (Amendment etc.) (EU Exit) Regulations 2019.
If one has to be in a Delegated Legislation Committee at 8.55 on a Tuesday morning, this room is a good result. Happy Tuesday.
It is a pleasure to see you in the Chair, Ms McDonagh. The instruments, which all concern food and feed safety, food hygiene and food contaminants, are made under the powers in the European Union (Withdrawal) Act 2018. They make necessary amendments to the overarching food regulations so that we can continue to protect public health from risks that may arise in connection with the consumption of food. The instruments correct deficiencies in the regulations to ensure that the UK is prepared to leave the EU without a deal on exit day. The instruments are limited to necessary technical amendments—the legislation does not allow for anything else—to ensure that the regulations are operative on EU exit day. No policy changes are made through the instruments.
As Members know, the Government have negotiated a deal with the EU and are in the process of taking it through Parliament. The deal is designed to ensure a smooth and orderly exit from the EU. As a responsible Government, we have been preparing for all scenarios, including the outcome that we leave the EU without a withdrawal agreement. We are committed to ensuring that our regulatory controls function effectively after exit day in the event of no deal, ensuring that public health continues to be protected, which is my priority. It is for that scenario that the instruments have been laid before the House.
I am grateful for the opportunity to intervene on the Minister, and it is a pleasure to see under you in the Chair this morning, Ms McDonagh. Can the Minister reinforce and clarify what he is saying? Is he saying that if there is a deal next week, the regulations will not be necessary, and that if there is no deal next week, and in the event of no deal, the regulations will be necessary for the protection of public safety?
Yes. The regulations transpose into domestic law the good public health requirements that we are part of as a member state. If we agree a deal or a withdrawal agreement next week that is subsequently legislated for, everything that we currently enjoy as a member state will roll over during the transition period. If we then negotiate a future trade deal that incorporates all those undertakings, the regulations will not be necessary, but it is about putting the necessary regulations in place to ensure a seamless bridge between membership and being a third country to protect public health, which is what I am interested in.
The instruments will ensure that UK domestic legislation that directly implements applicable EU regulations continues to function effectively after exit day. The proposed amendments are critical to ensuring minimal disruption to general food and feed law, food hygiene and controls on contaminants if we do not reach a deal. The regulations on general food and feed law, food hygiene and controls on contaminants are key to ensuring the safety of food and thereby public health. Consumers in the UK will benefit from a high standard of food and feed safety and quality. The Government are committed to ensuring that the high standards are maintained.
The main changes are that the instruments will transfer responsibilities incumbent on the European Commission to Ministers in England, Wales, Scotland, and the devolved authority in Northern Ireland. They also transfer to the relevant food safety authority the responsibilities currently incumbent on the European Food Safety Authority, the body that provides scientific advice on food safety to the European Commission, the European Parliament and EU member states. That authority will be the Food Standards Agency in England, Wales and Northern Ireland, and Food Standards Scotland north of the border.
Let me take the regulations in turn, because they start very general and get more specific. The General Food Law (Amendment etc.) (EU Exit) Regulations 2019 ensure that Regulation (EC) 178/2002, which lays down fundamental principles underpinning food law, basic food and feed business requirements, as well as describing certain functions carried out by EU institutions, will function effectively on exit day. The regulation states that food placed on the market must be safe to eat, and it provides for other fundamental food and feed safety and hygiene requirements, including presentation, traceability—we must be able to look one step back and one step forward in the supply chain—the enforcement of regulations, and open and transparent public consultation during the preparation, evaluation and revision of food law. I used the word “presentation”, which is to ensure that we do not mislead consumers. Members may remember that a few years ago there were a lot of concerned constituents because of press coverage about horse meat being sold as certain other meats, and these regulations will ensure that food is what it says on the tin.
The General Food Hygiene (Amendment) (EU Exit) Regulations 2019 ensure that Regulation (EC) 852/2004, which contains basic food hygiene requirements for all food businesses, will function effectively on exit day. It sets out the general requirements for the hygienic production of foodstuffs by all food business operators, through the provision of effective and proportionate controls throughout the food chain to the final consumer. Its farm-to-fork scope covers basic hygiene requirements for food businesses, as well as hygiene requirements relevant for the primary production sector.
It is a pleasure to serve under your chairmanship, Ms McDonagh. As a former public health Minister, I am interested to hear what the Minister says about this issue, and I feel reassured that as we leave the European Union there is no question of the UK falling behind on food safety standards. In many respects, while being a member of the EU we have been at the forefront of pushing higher standards—in fact, we probably have higher standards than a number of EU member states. Will the Minister say a little more to reassure the public? There have been some wild scare stories out there about how Sodom and Gomorrah will somehow arrive if we leave the EU, and that there will be lightning bolts from the sky, earthquakes, and we will fall off a cliff edge and no longer be able to buy a portion of fish and chips without worrying about our public health.
I thank one of my esteemed predecessors for that point. When we had a referendum on our membership of the EU, we heard talk of “take back control”. Ultimately, that was about many things—it was about sovereignty, the economy and trade, but I do not think it was about weakening the public food standards that our constituents expect. When I delved into this area of policy as part of my portfolio for these statutory instruments, I realised how much heavy lifting goes on in the European Commission to protect that food security, which we benefited from as a member state. I also realised—the right hon. Lady made the point well—how much we have shaped that. The idea that when we are a third country we will want to diverge from those standards is for the birds. If anything, I want us to increase food safety standards, and the idea that leaving the European Union will leave us as a country, and our constituents and the public exposed, is indeed “Project Fear”, and people should be more responsible in the way they use such language. I thank the right hon. Lady for her point.
Regulation (EC) 852/2004 contains a key requirement that food businesses—except primary producers—must put in place food safety procedures based on the principles of the internationally recognized hazard analysis critical control point procedures. That means that each food business must assess hazards to food safety, and put in place steps to ensure they are controlled, thus ensuring the high level of consumer protection that we all expect.
The Specific Food Hygiene (Amendment etc.) (EU Exit) Regulations 2019 relate to Regulation (EC) 853/2004, which covers specific hygiene rules for products of animal origin, and Regulation (EC) 854/2004, which relates to the organisation of official controls for products of animal origin. Let me unpack that. We are talking about meat, fish, dairy and eggs. Regulation (EC) 853/2004, for instance, is the regulation by which we determine what kind of wash we might use on certain products. Our standards, as a member state, say—just to give an example that somebody might be interested in—how we wash chicken after it has been killed. Currently, we wash with drink-water. We will continue to wash with drink-water and the standards that we transpose protect that safety standard, which exists for a reason, and long may that continue. That regulation is about the processing stage—cutting plant standards and standards relating to the wash, for instance.
Regulation (EC) 854/2004, which relates to the specific food hygiene regulations, concerns vet involvement. When I have been to cutting plants, I have seen vets’ involvement at the pre-kill stage, to ensure that the animals have no sign of disease, and at the post-kill phase—which is not to be done after breakfast, I would suggest—to check the carcasses and ensure that there are no signs of ill health. These specific hygiene rules set out the requirements and the specific health standards for establishments on land, or at sea, for the slaughtering process, as I have said, and for the storing or transporting of products of animal origin.
The fourth and final set of regulations in this esteemed grouping, the Contaminants in Food (Amendment) (EU Exit) Regulations 2019, will ensure that the provisions in the three main pieces of EU contaminants legislation continue to function effectively after exit day. These are Council Regulation (EEC) No. 315/93 and Commission Regulation (EC) No. 1881/2006, which is the main one, which sets maximum levels for certain contaminants in foodstuffs. For instance, lead in offal is a possible concern, and that regulation ensures that the maximum level of certain contaminants in that foodstuff is not exceeded.
Finally, Commission Regulation (EC) No. 124/2009 sets maximum levels for the presence of coccidiostats or histomonostats—easy for me to say—in food resulting from the unavoidable carryover of those substances in non-target feed, while associated regulations relate to appropriate methods of sampling and analysis.
The three contaminants regulations protect consumers by ensuring that they are safeguarded from the adverse effects of exposure to contaminants that may be present in food. Chemical contaminants may be present in food from the environment or as a result of growing conditions, which is perfectly natural; it is part of the natural evolution and the natural supply chain. The legislation sets out maximum limits for those certain contaminants in food and provides a clear legal basis on which enforcement action—by local authorities, by trading standards officers or by ports’ health officers—may be taken, where necessary, to protect consumers by facilitating the removal of unsafe food from the food chain.
There are a couple of other points to make. The first is about the impact on industry. I am clear that these instruments do not introduce any changes for food businesses in how they are regulated and how they are run, nor do they introduce extra burdens. These instruments just provide continuity for businesses and the protection of consumers’ interests, and ensure that enforcement of the regulations can continue in the same way—I gave three examples of that. These changes will ensure that a robust system of controls will underpin UK businesses’ ability to trade both domestically and internationally.
It is also important to note that, as with many of the statutory instruments that I have been involved with—in fact, as with all of them—the devolved Administrations have provided their consent for these SIs. We have engaged positively with the devolved Administrations throughout the development of these instruments. That ongoing engagement has been very warmly welcomed, and I place on the record my thanks to all the officials and Ministers who we have worked with.
In conclusion, these instruments are necessary to ensure that our food safety and hygiene legislation continues to work effectively after exit day. I urge right hon. and hon. Members to support the amendments proposed in these four instruments, to ensure the continuation of effective food and feed safety, and public health controls, which our constituents rightly expect. I commend the regulations to the Committee.
It is indeed a pleasure to serve under your chairmanship this morning, Ms McDonagh; I hope I give you no trouble.
I thank the Minister for providing a summary of these statutory instruments and for his letter in advance of the Committee, which gave me further details about them. As he has heard me say many times before, this is not the first group of no-deal SIs that we have debated. We are just 24 days away from Brexit day and are yet to agree a deal with the EU. I wonder when the Government might start to become concerned about the clock ticking down. I am greatly concerned, and I know that many others across the country are too. We do not have a deal yet, but we are rushing through so many statutory instruments in such a short period of time that it is deeply concerning for accountability and proper scrutiny. As legislators, we have to get it right, and I deeply regret that we have been put in this position by the Government, but here we are again.
The safety of our food is of the utmost importance to our health and wellbeing. We cannot get it wrong; food safety must be protected at all costs. There is also the element of consumer trust. We must not allow that to break down in any event, particularly if there is any relaxation of regulations, which I hope will not happen. I share the Government’s commitment to ensuring no change in the high-level principles underpinning the day-to-day functioning of the food safety and feed safety legal framework. Ensuring continuity for business and public health bodies is important in the interests of the public. As the Minister would expect, I have questions and concerns about these statutory instruments, which I will set out for the Committee.
When food is found to be unsafe for human consumption, we need a quick and effective mechanism to ensure that it is withdrawn from the market. In 2017 alone, the rapid alert system for food and feed issued more than 3,800 “original notifications”, of which 942 were classified as an alert. It is crucial that any food warnings are communicated quickly and effectively. Will the Minister revise the explanatory memorandum for the General Food Law (Amendment etc.) (EU Exit) Regulations 2019 and ensure that alternative arrangements are made to receive food safety warnings that are quick, clear and effective?
As a result of these regulations, the Food Standards Agency will have additional responsibilities in the result of a no-deal Brexit. I am aware of additional funding being made to the FSA, but is the Minister confident that it will have enough funding and staff to take on those additional responsibilities? Will he outline how many additional staff have already been recruited, when they started work and what roles they are currently undertaking? Will the FSA have the ability to work and communicate with European bodies to ensure that information and intelligence is shared?
Regulation 19(c) of the general food law regulations assigns the Secretary of State for Health and Social Care the power to make provisions considered “necessary or expedient”. Will the Minister say whether there will be any oversight over such decisions and whether the Secretary of State will justify any decisions made under those powers in the House?
All the regulations must be easily amendable, if and when necessary, to respond to any emerging threats or changes in safety standards, but I hope that any changes will be justified and overseen by the relevant bodies. What will the arrangements be for collecting data, monitoring the effectiveness of the regulations and regularly reporting? What bodies will be able to scrutinise performance and delivery, and what assessment has been made of their capacity to take on such work?
Concerns were expressed in the public consultation on these statutory instruments about the additional burden on industry and enforcement authorities to communicate changes. Will the Minister reassure me and the Committee that communications with respect to the proposals outlined in these SIs will be delivered with sufficient time to make the necessary preparations to minimise the impact of any changes?
Businesses and food business operators have raised concerns about the lack of information given to them, as well as about their own understanding of the information. Will the Government make their information clear to the public, and if so, when will they do this by? Sufficient transition periods will be required for these statutory instruments. Can the Minister provide some clarity on the transition periods that will be in place to assist businesses and industry in complying with any changes? The explanatory memorandum states that there will be
“an Equivalent Annual Net Direct Cost to Business…of…£600,000.”
Can the Minister explain how those costs will be accrued and by whom, and if they have been communicated to those affected?
Respondents to the consultation on the Specific Food Hygiene (Amendment etc.) (EU Exit) Regulations 2019 raised concerns about the cost of changing their labels. Some respondents estimated that that could cost between £200,000 to £500,000. Has the Minister made any assessment of the impact that that could have on businesses?
In the public consultations, local authorities expressed concerns about the need for them to make the required updates to legal references in official documents and online, which will take significant time and effort and will naturally have cost implications for local authorities, which is concerning in the light of budget cuts. Can the Minister confirm whether the Government will fund any additional burdens on local authorities, especially in the event of a no-deal Brexit?
It is estimated that it will take local authorities less than 60 minutes to read and familiarise themselves with the new regulations and to disseminate them to staff and keyholders—they must be able to read a lot faster than me. Is the Minister convinced that that is a realistic assessment?
Is the Minister confident that, from day one of Britain’s exit from the EU, the high standards of food safety will be maintained? Can he explain what implications a no-deal Brexit would have on the future monitoring of food safety standards and legislation in this country? As I have said, the safety of our food is hugely important and we cannot get it wrong.
Does my hon. Friend agree that if we agree a deal, there will be no change to any of the systems that we currently share and enjoy? Does she also agree that more should be said publicly about how many of the regulations that we enjoy and support in the House—I have sat on many of these Committees—will continue to be in place as we leave the EU?
I do apologise. If we leave with a deal, all this will have been for naught. We have some of the highest food standards and regulations, and they would continue to exist. That is all the more reason why it is such a disappointment to us all that we are at the eleventh hour and the 58th or 59th minute and we still do not have a deal. I sincerely hope that one is brought before the House next week that a majority of the House can vote for.
I am sure the hon. Lady is aware that the pages of regulations that we are trying to transpose into UK law have never had parliamentary scrutiny. They are regulations, so as soon as the ink is dry in Brussels, they become the law of the land whether we like it or not, with no debate in this place. Uniquely, in future, we will have the opportunity to shape our regulations.
As the hon. Lady is aware, the EU operates a precautionary principle. Many think that the standards that come out of Brussels are somehow gold-plated holy writ, but she will be aware of the problems that we have faced in past years, such as the Fipronil scandal in August 2017, which affected eggs. That happened under the regulations that are meant to be the gold standard, but I certainly hope that the UK will be able to do better in future. Can she comment on the fundamental principle that it is better that this place decides food safety, rather than it being decided by regulations over which we have no authority?
Order. I would like us to concentrate on the detail of the regulations, rather than straying into the territory of whether we should be leaving the EU.
With that advice in mind, Ms McDonagh, I would say that, given that the hon. Gentleman had quite a lot to say, perhaps he should have considered making a full speech and graced us with his further thoughts on these matters. I am sure that we would all have enjoyed that immensely. However, I disagree with the fundamental principle of what he said, which is that these regulations were passed in Europe with no scrutiny here.
As a new MP, as I am sure a number of us were at one time or another, I had the huge pleasure of serving on the European Scrutiny Committee. Week in, week out, we would be sent reams of documents containing EU directives and regulations that our esteemed Clerks would have rated as politically or financially sensitive. They gave us advice, but we had to read all those documents and sit and scrutinise them all, week in, week out. We could then refer them for further debate in a European Standing Committee or on the Floor of the House, if we thought something needed scrutiny. I know for a fact that we scrutinised all EU directives that came to this House. Nothing was passed without proper scrutiny. It is a shame the hon. Gentleman has not had a chance to serve on that Committee, because he might never get a chance.
Oh, he has; because I was going to say, the hon. Gentleman has missed a treat.
I hope the Minister will respond to my concerns, either now or in a letter. I know he always sends a letter if he is unable to respond on the day. I know, too, that many others, not only in this room but across the country, will be looking forward to his response.
It is a pleasure to serve under your chairmanship, Ms McDonagh.
I will be brief. Regardless of the SNP’s opposition, in principle and in its entirety, to the UK’s withdrawal from the EU, we recognise and understand how important it is that these statutory instruments are established and that we preserve the framework around the status quo. Food standards post-Brexit will be a critical issue. It is crucial that neither food safety nor standards are diluted or diminished. Scotland has a great record in food exports, and our great Scottish food is recognised across the world as being of a particularly high standard. We all want that to continue.
The stockpiling of food in preparation for Brexit demonstrates the drastic effect that the Brexit process has had on the most basic of human requirements. It is important to emphasise that the review of these instruments should ensure the retention of the highest standard of food safety. The Government could avoid all this administrative burden if they simply ruled out a no-deal Brexit. It is especially important to small businesses that any additional requirement placed on them, or any financial burden, no matter how small, is recompensed by the Government.
It is a pleasure to follow the hon. Member for Washington and Sunderland West. I cannot compete with all her questions to the Minister and will not repeat them. I will simply say to the Minister, please answer them, because we are interested in these matters too. Given that no policy change is being enacted and these instruments are required to ensure food standards, I will abstain if they are put to a vote.
It is a pleasure to follow the hon. Member for Motherwell and Wishaw. Unlike my right hon. Friend the Member for Don Valley—or, for that matter, the Minister—I was not a public health Minister. However, I was the Minister of State at the Department for Environment, Food and Rural Affairs responsible for food. Food security in all its aspects—continuity of supply, quality, safety and sustainability—was absolutely critical to the Department. That was very much the case for producers, suppliers and retailers big and small, as the hon. Member for Motherwell and Wishaw mentioned.
I am grateful to my hon. Friend the Member for Washington and Sunderland West, the shadow Minister, for raising her questions with the Minister. As I mentioned in my brief intervention earlier, I oppose no deal and I do not think that there is a majority for it in the House. Therefore, I do not think that the regulations will have to apply. However, the Government must make contingency plans, and perhaps the Minister can reassure us that, in line with what my hon. Friend said, the regulations are a straight transposition of the existing arrangements and regulations that apply to the British food industry.
I would be reassured by that, and I am grateful to my hon. Friend the shadow Minister for indicating that we will not oppose the regulations. I would find it difficult to oppose them, on the public safety and health basis that she outlined. I look forward to getting that reassurance from the Minister, as well as some reinforcement of the points he made in his opening remarks.
I shall work in reverse and begin with the comments of the hon. Member for Poplar and Limehouse, who is a good man. He may not have been a public health Minister, but if he had been, he would have been a very good one. We have engaged with certain issues many times in Westminster Hall and I know exactly where he would place his focus if he were in my job. Hey, he might be one day—who knows?
To begin with the point about transposition, the simple answers is yes. As I said, the European Union (Withdrawal) Act 2018 allows us only to do the housekeeping. That is effectively what these constant fun Tuesday mornings about. They are about the housekeeping and transposing regulations into domestic law. I cannot imagine why anyone would oppose them, because it would be to oppose the status quo, which, I think everyone agrees, keeps the public safe.
There were lots of questions from my dear friend and shadow, the hon. Member for Washington and Sunderland West. She started where she always does, and I shall start where I always do, with the withdrawal agreement. Let us remember, we are not discussing a deal, or a future trade deal, but a withdrawal agreement—a divorce, if you like. Yes, there is no withdrawal agreement yet, and there are 24 days, but the hon. Lady knows what I am going to say. She has a golden chance next week, on or before next Wednesday, to change that.
As to scrutiny, we have spent quite a lot of time in Committee sittings scrutinising SIs together, and in some ways it has been an interesting spring cleaning process, has it not? We have delved into some regulations that I suspect have not been discussed in this place for a long time. The hon. Lady rightly says that we cannot get this wrong, because we have to bear in mind consumer confidence always. That is why we are so keen to get things right.
The hon. Lady raised the issue of relaxation, but that would not happen under the present process, because, as I said to the hon. Member for Poplar and Limehouse, this is a process of transposition. Any relaxation—or indeed increase—of rules in the area in question would be subject to discussion, consultation and approval by this place. That is when we finally find out what “take back control” means.
This follows on a little from what the Minister has been saying, but I understand that rates of food poisoning in the US are 10 times those of the UK, and the death rates from food poisoning are also much higher. Whatever happens next week, will the Minister assure us that any trade deals negotiated with the US and elsewhere will involve the same standards of food safety that we require now?
What I can do is repeat the words of the Prime Minister and the Secretary of State for Environment, Food and Rural Affairs, who have said that there will be no diminution of food safety standards in pursuit of trade deals with the US or anywhere else; and even if such changes were proposed, Parliament would have the final say. Hon. Members can read the paper that was set out last week, on how the Government would conduct future trade negotiations and engage with Parliament. I think we know where Parliament would stand on the matter of diminution of food standards.
I do not think that we have sent a letter. I am not sure that it would be my place to do so anyway, but the British Government have been crystal clear that we do not expect any degradation of food standards in pursuit of a future trade deal. That has been said by the Prime Minister, down to those at my lowly rank.
To go back to what the hon. Member for Washington and Sunderland West said about maintaining high standards of food safety, leaving the EU does not change our top priority, which is to ensure that UK food remains safe, and that the label says what it is. The Food Standards Agency is working very hard to ensure that high standards of food safety are maintained. We are committed to having a robust regulatory regime in place from day one that will mean that businesses can continue as normal. That is why we are transposing the legislation word for word.
The hon. Lady talked about RASFF, the rapid alert system for food and feed, to which the UK is a major contributor. RASFF facilitates vital food and feed safety data sharing. It is clearly of mutual benefit to the UK and our EU partners to share food and feed safety information quickly, so securing continued access to, and participation in, the system after leaving the EU is one of our top food safety priorities. We continue to press for full access to that vital data-sharing system in our negotiations with the EU. Even as a third country, the UK will continue to receive information from the EU as required by EU law—it is worth putting that on the record—where a food or feed subject to notification under the rapid alert system has been dispatched from the EU to the UK. However, not having full RASFF access would mean less data than is currently available, which may affect UK timely communications on food safety issues.
With regard to actions that we will take to mitigate the loss of full access, the FSA has been building on proven mechanisms, such as the monitoring of key data sources and a new strategic surveillance programme, to enhance its capability and capacity to respond effectively to any food-borne contamination or outbreak incident that occurs in the UK, for the protection of our consumers. In terms of other international engagement, the FSA is implementing an enhanced programme of bilateral engagement and surveillance that focuses on the exchange of information on risks to the food chain. It is engaging with competent food safety authorities across Europe and worldwide, building on its strong reputation and established contacts to develop a mutually supportive approach to information sharing on food safety incidents.
There is no getting away from the fact that we have decided to leave, and are leaving, the EU. We therefore will leave some of its processes, one of which is the RASFF. However, as I have said, we will do our utmost to secure continued access to it—we were, of course, a huge contributor to establishing it in the first place. If we cannot, some of the mitigations that I have outlined will be important.
The hon. Member for Washington and Sunderland West asked about the FSA. Her Majesty’s Treasury has made significant extra funding available to the FSA to increase staff, for instance, some of whom are in the room. The FSA’s resource has expanded to ensure that it can undertake the assessment and the risk exercise, to ensure food safety. In answer to a direct question, I am satisfied that it has the new resources that it needs.
The hon. Lady asked about the additional burden on industry for enforcement. We do not expect any additional enforcement burdens. The law and the regulations remain exactly the same, which is why I addressed the transposition point first in my response. She also mentioned the need for clarity on the transition period for businesses to implement any changes. As I have said, the transition period will involve the continuation of the existing standards, so businesses will not need to adapt to any extensive changes.
I was asked whether we will fund local authorities for additional burdens. We are providing support to enforcement officers in local authorities to allow them to continue to enforce the legislation. However, no policy changes are being made in practice. For labelling changes domestically, the transition period will be considered. We may talk about such statutory instruments in future happy moments, but today’s legislation is not about the labelling of products. Of course, we will have a whole new freedom once we leave the European Union in terms of labelling. I have talked about that in other policy areas—around obesity, for instance, with traffic light labelling.
The hon. Lady talked about 60 minutes of familiarisation not being realistic. Were there substantial changes, I suppose that that would not be realistic, no matter how fast one reads. However, businesses will need little familiarisation time, for the reasons that I have said.
Finally, the spokesperson for the Scottish National party, the hon. Member for Motherwell and Wishaw, talked about the importance of Scottish food exports. They are indeed very important to the country, including within the UK single market. That is why there is some level of consistency, and why we expect to have convergence across the four nations of the UK. That is very important for the internal market, and for Scottish food exports to the EU. I know what I would do if I represented a seat in Scotland and the Scottish food industry: I would ensure that we have a smooth and safe transition out of the EU at the end of March. There will be a golden opportunity for the hon. Lady to do that next week.
That the Committee has considered the draft General Food Hygiene (Amendment) (EU Exit) Regulations 2019.
Draft Contaminants in Food (amendment) (EU Exit) regulations 2019
That the Committee has considered the draft Contaminants in Food (Amendment) (EU Exit) Regulations 2019.—(Steve Brine.)
Draft specific Food Hygiene (amendment Etc.) (EU Exit) regulations 2019
That the Committee has considered the draft Specific Food Hygiene (Amendment etc.) (EU Exit) Regulations 2019.—(Steve Brine.)
Draft General Food Law (amendment Etc.) (EU Exit) regulations 2019
That the Committee has considered the draft General Food Law (Amendment etc.) (EU Exit) Regulations 2019.—(Steve Brine.)
DRAFT MERCHANT SHIPPING (PASSENGERS' RIGHTS) (AMENDMENT ETC.) (EU EXIT) REGULATIONS 2019 DRAFT MERCHANT SHIPPING (STANDARDS OF TRAINING, CERTIFICATION AND WATCHKEEPING) (AMENDMENT) (EU EXIT) REGULATIONS 2019
The Committee consisted of the following Members:
Chair: Mr Adrian Bailey
† Bradley, Ben (Mansfield) (Con)
† Brown, Alan (Kilmarnock and Loudoun) (SNP)
Champion, Sarah (Rotherham) (Lab)
† Donelan, Michelle (Chippenham) (Con)
Ellman, Dame Louise (Liverpool, Riverside) (Lab/Co-op)
George, Ruth (High Peak) (Lab)
† Ghani, Ms Nusrat (Parliamentary Under-Secretary of State for Transport)
† Heappey, James (Wells) (Con)
† Jones, Mr Kevan (North Durham) (Lab)
† McGinn, Conor (St Helens North) (Lab)
† Merriman, Huw (Bexhill and Battle) (Con)
† Mills, Nigel (Amber Valley) (Con)
† Peacock, Stephanie (Barnsley East) (Lab)
† Turner, Karl (Kingston upon Hull East) (Lab)
† Vickers, Martin (Cleethorpes) (Con)
† Villiers, Theresa (Chipping Barnet) (Con)
† Wood, Mike (Dudley South) (Con)
Dominic Stockbridge, Committee Clerk
† attended the Committee
Fourth Delegated Legislation Committee
Tuesday 5 March 2019
[Mr Adrian Bailey in the Chair]
Draft Merchant Shipping (Passengers’ Rights) (Amendment etc.) (EU Exit) Regulations 2019
I beg to move,
That the Committee has considered the draft Merchant Shipping (Passengers’ Rights) (Amendment etc.) (EU Exit) Regulations 2019.
With this it will be convenient to discuss the draft Merchant Shipping (Standards of Training, Certification and Watchkeeping) (Amendment) (EU Exit) Regulations 2019.
It is an honour to serve under your chairmanship on this bright morning, Mr Bailey.
The two sets of draft regulations will be made under powers in the European Union (Withdrawal) Act 2018. The Act retains directly applicable EU legislation in UK law and preserves EU-derived domestic legislation. Section 8 also makes provision for Ministers to correct deficiencies in retained EU legislation that arise from the UK leaving the European Union. To ensure that the retained legislation remains operable, both sets of draft regulations change references to member states and the Commission to the Secretary of State or the United Kingdom. The draft regulations also change definitions and other wording to reflect the UK’s position outside the EU.
The first set of draft regulations deals with the certificates that seafarers need to hold to demonstrate their competence to perform certain roles on ships. The international convention on standards of training, certification and watchkeeping sets the standards of competence for seafarers internationally. Through two directives, the EU harmonised the way in which member states implement the requirements of the STCW convention. The EU directives and our international obligations are implemented by the Merchant Shipping (Standards of Training, Certification and Watchkeeping) Regulations 2015, which will be amended by the regulations under consideration. The Government have decided to continue to recognise seafarer certificates from EU and EEA countries. The UK will also continue to recognise the certificates from those non-EU or EEA countries that are approved by the EU and currently recognised by the UK. The draft regulations enable the Secretary of State to maintain the recognition of certificates from such countries.
The draft regulations allow the Secretary of State to recognise additional parties to the STCW convention and the certificates that they issue. The Secretary of State must be satisfied that any such country complies fully with the requirements of the convention. The regulations also enable the Secretary of State to remove recognition from any country if he is satisfied that the country no longer complies with the convention. The regulations replace a requirement to report to the European Commission on compliance with the STCW convention with a requirement to report on compliance to the secretary-general of the International Maritime Organisation.
The 2015 regulations that are being amended are about the seafarers who work on UK-flagged ships. With the support of Nautilus International and the Chamber of Shipping, we are working with EU countries to ensure continuity for the UK-trained seafarers who work on EU-flagged ships.
The second set of draft regulations deals with passenger rights and other issues involving the carriage of passengers by sea. Under EU regulation 1177/2010, UK passengers travelling by sea and inland waterways benefit from a comprehensive set of rights and entitlements. The regulations put in place consumer protections that, among other things, allow for redress in respect of delayed and cancelled journeys. They also define the standards that industry must uphold in respect of disabled passengers to provide them with the same opportunities and assistance to travel as they have in other transport sectors at no extra cost. Furthermore, the International Maritime Organisation’s Athens convention requires shipowners to maintain compulsory insurance, which must be sufficient to cover third-party claims in respect of death or personal injury to passengers and the loss of or damage to luggage and vehicles.
The draft regulations amend EU regulations 1177/2010 and 392/2009 to ensure that they continue to function correctly as part of UK law. The changes will not affect passengers in any way and will serve to ensure that they continue to enjoy the rights and entitlements available to them today. The regulations also amend the EU-derived domestic legislation that implements EU law in that area.
So that the UK continues to meet its international obligations under the Athens convention once the UK leaves the EU, the draft regulations will transfer power from the European Commission to the Secretary of State. That will enable the UK to keep up to date with changes to the compulsory insurance requirements and liability limits for shipowners, as and when they are adopted by the International Maritime Organisation. That will not create a burden on shipowners, as state certificates are easily obtainable from state parties to the convention, including, for example, from the Maritime and Coastguard Agency in the UK. The proposed change will therefore not have any significant impact on industry. It simply ensures that we are complying with our international obligations under the convention without exemption.
The changes made by the draft regulations will ensure that retained EU law operates effectively, so that we have an effective system for ensuring that seafarers working on UK ships are qualified to do so, and that passengers can continue to rely on the rights and entitlements they currently enjoy. They are also important for ensuring that the UK can continue to meet its international obligations and passenger safety commitments. I commend the draft regulations to the Committee.
It is a pleasure to see you in the Chair, Mr Bailey, and it is always a pleasure to serve under your chairmanship.
The instrument relating to passenger rights ensures that current provisions relating to rights and entitlements of passengers when travelling by sea and inland water are legally operable when the UK leaves the EU. They are entirely sensible and the Opposition support them.
The instrument relating to standards of training amends the Merchant Shipping (Standards of Training, Certification and Watchkeeping) Regulations 2015—the STCW regulations. The amendments made by the instrument, as the Minister has briefly outlined, will broadly maintain the existing policy position. The UK will continue to recognise seafarer certificates issued by parties to the international convention on standards of training, certification and watchkeeping for seafarers that are currently recognised, and a new mechanism will be established enabling the Secretary of State to recognise certificates from other parties to the convention in the future. The Opposition will support this instrument.
I have one brief question. I believe the EU is looking at tightening up the basic training of seafarers. If there are changes to the STCW training requirements at EU level once we are no longer in the EU and are effectively a third party, what will the Government’s position be?
It is a pleasure to serve under your chairmanship, Mr Bailey. It is of note that my hon. Friend the Member for Kingston upon Hull East is the shadow Minister in the Committee, because I worked with his father, who was a National Union of Seamen official for many years. I am sure he is looking down favourably on my hon. Friend today.
I agree with my hon. Friend on the draft regulations, but I would like to ask for clarification regarding the amounts in euros for which provision is made by article 6(1) of regulation (EC) 392/2009, and articles 17(2) and 19(6) of regulation (EU) 1177/2010. The amounts are in euros. The explanatory memorandum to the passengers’ rights regulations states that the exchange rate used is the average rate for the year ending 31 December 2017. Why is the exchange rate for that period used, rather than a more up-to-date one? I understand that the exchange rate was £1 to €1.14615. These amounts are clearly set at the moment. What is the mechanism for increasing or changing them in the future? Would we just adopt what was put forward?.
It is a pleasure to serve under your chairmanship, Mr Bailey. I will be brief. So long as the Scottish National party is a party, we are opposed to Brexit, particularly a possible no-deal Brexit, but we accept that the draft regulations are sensible to provide continuity, as a contingency. My main question to the Minister is this: paragraph 7.5 of the explanatory memorandum to the Merchant Shipping (Standards of Training, Certification and Watchkeeping) (Amendment) (EU Exit) Regulations correctly states:
“These regulations cannot provide a mechanism to ensure other EU/EEA countries continue to accept UK Certificates of Competency once the United Kingdom leaves the EU.”
Can she tell us where the Department has got to in its ongoing discussions on some sort of reciprocal arrangement?
Slightly tangential to that question, where is the Department in terms of supporting non-EU workers’ ability to work in the merchant shipping sector, particularly fishing vessels? There is already a problem in Scotland of labour from outwith the EU not being able to get permits to work.
I thank the hon. Members for Kingston upon Hull East and for Kilmarnock and Loudoun, and the right hon. Member for North Durham, for their consideration of the draft regulations, which deal with important issues relating to the carriage of passengers by sea and the qualifications that seafarers must hold. The regulations are designed simply to ensure that the EU-derived legislation will be retained in UK law and continue to function as intended. They make the changes appropriate to ensuring that the existing regulatory framework is retained and operates effectively when we leave the EU.
On the question of basic seafarer training, possible changes to STCW training requirements and the UK Government’s position, I emphasise the fact that the UK is party to the STCW convention and it is our policy to continue to apply changes to the convention in domestic law.
On how we will work with countries to ensure that our seafarers and their certificates are recognised, we are indeed working with European countries on a bilateral relationship and working in partnership with Nautilus International and the UK Chamber of Shipping to put in place a simple process for the Commission to recognise UK seafarers in future if we leave without a deal. We are focused on ensuring that the arrangement is reciprocated. The hon. Member for Kilmarnock and Loudoun must know that my portfolio includes responsibility for taking care of our seafarers.
The hon. Gentleman also mentioned countries outside the EU and EEA; already within the convention 50 countries are recognised and half of those are third- party countries, so we will continue to work with them. I believe there are about 24 or 25.
There was also a question about euros; I must say I was not expecting that this morning, but I am grateful to the right hon. Member for North Durham for raising it. The exchange rate was set at the beginning of the drafting process, as is normal. I am not sure what more I can say about the financing and the particular point he raised, but if he will allow me, I will write to him in detail to confirm the absolute answer to that. I would not want to give him anything inappropriate right here and right now.
I accept the Minister’s explanation of why the 2017 figure was used, but I think she ought to remind her officials that when this regulation is laid, the information put before the Committee should be up to date, because there is clearly a more appropriate figure to use than the 2017 one. It is not a great point, but I think it is a point worth noting.
It is indeed a valuable point and no doubt it has been noted, but as the right hon. Gentleman will know, there are always processes in place and that process has been followed when exchange rates are set. No doubt his point will be noted and there will be a comment on it in future in case it is raised. I am sure my officials have made a note.
I am pleased that the Committee supports the regulations. They are appropriate to ensuring that the retained EU legislation relating to seafarer qualifications, passenger rights and the carriage of passengers by sea continues to work effectively in the UK from day one after exit. I commend the regulations to the Committee.
Question put and agreed to.
DRAFT MERCHANT SHIPPING (STANDARDS OF TRAINING, CERTIFICATION AND WATCHKEEPING) (AMENDMENT) (EU EXIT) REGULATIONS 2019
That the Committee has considered the draft Merchant Shipping (Standards of Training, Certification and Watchkeeping) (Amendment) (EU Exit) Regulations 2019.—(Ms Ghani.)
Draft Greater Manchester Combined Authority (Functions and Amendment) Order 2019
The Committee consisted of the following Members:
Chair: Mr Nigel Evans
† Berry, Jake (Parliamentary Under-Secretary of State for Housing, Communities and Local Government)
† Eagle, Ms Angela (Wallasey) (Lab)
† Elmore, Chris (Ogmore) (Lab)
† Graham, Luke (Ochil and South Perthshire) (Con)
Johnson, Diana (Kingston upon Hull North) (Lab)
† Jones, Susan Elan (Clwyd South) (Lab)
† Knight, Julian (Solihull) (Con)
† Lefroy, Jeremy (Stafford) (Con)
† Lopez, Julia (Hornchurch and Upminster) (Con)
† McMahon, Jim (Oldham West and Royton) (Lab/Co-op)
† Morgan, Stephen (Portsmouth South) (Lab)
† Morris, James (Halesowen and Rowley Regis) (Con)
† Phillipson, Bridget (Houghton and Sunderland South) (Lab)
† Quin, Jeremy (Lord Commissioner of Her Majesty's Treasury)
† Quince, Will (Colchester) (Con)
Spellar, John (Warley) (Lab)
† Warburton, David (Somerton and Frome) (Con)
Matthew Congreve, Mariam Keating, Committee Clerks
† attended the Committee
Fifth Delegated Legislation Committee
Tuesday 5 March 2019
[Mr Nigel Evans in the Chair]
Draft Greater Manchester Combined Authority (Functions and Amendment) Order 2019
I beg to move,
That the Committee has considered the draft Greater Manchester Combined Authority (Functions and Amendment) Order 2019.
It is a pleasure to serve under your chairmanship, Mr Evans. The draft order having been before the House for some period—it was laid on 30 January—I do not intend to make any further remarks, except that I commend it to the Committee.
It is a pleasure to serve under your chairmanship, Mr Evans. I do not intend to exceed the Minister’s brief introduction. We recognise that the Government acted very quickly in bringing the statutory instrument to the House following the request from Greater Manchester. That is acknowledged and appreciated. We do not intend to divide the Committee.
Question put and agreed to.
DRAFT FORESTRY AND LAND MANAGEMENT (SCOTLAND) ACT 2018 (CONSEQUENTIAL PROVISIONS AND MODIFICATIONS) ORDER 2019
The Committee consisted of the following Members:
Chair: Mr Laurence Robertson
† Adams, Nigel (Parliamentary Under-Secretary of State for Wales)
† Chapman, Douglas (Dunfermline and West Fife) (SNP)
† Charalambous, Bambos (Enfield, Southgate) (Lab)
† Ford, Vicky (Chelmsford) (Con)
† Gaffney, Hugh (Coatbridge, Chryston and Bellshill) (Lab)
† Hall, Luke (Thornbury and Yate) (Con)
† Howell, John (Henley) (Con)
† Hughes, Eddie (Walsall North) (Con)
† Killen, Ged (Rutherglen and Hamilton West) (Lab/Co-op)
† Lopresti, Jack (Filton and Bradley Stoke) (Con)
† Mak, Alan (Havant) (Con)
† Mann, John (Bassetlaw) (Lab)
† Masterton, Paul (East Renfrewshire) (Con)
Murray, Ian (Edinburgh South) (Lab)
† Stewart, Iain (Milton Keynes South) (Con)
† Sweeney, Mr Paul (Glasgow North East) (Lab/Co-op)
† Whitfield, Martin (East Lothian) (Lab)
Jack Dent, Committee Clerk
† attended the Committee
Eleventh Delegated Legislation Committee
Tuesday 5 March 2019
[Mr Laurence Robertson in the Chair]
Draft Forestry and Land Management (Scotland) Act 2018 (Consequential Provisions and Modifications) Order 2019
I beg to move,
That the Committee has considered the draft Forestry and Land Management (Scotland) Act 2018 (Consequential Provisions and Modifications) Order 2019.
Mr Tomlinson—sorry, Lawrenson.
Robertson—third time lucky.
It is early, Mr Robertson—it is a while since I have been here at five to 9. It is a great pleasure to serve under your chairmanship. This order is made in consequence of the Forestry and Land Management (Scotland) Act 2018, which for ease of use I shall refer to as the 2018 Act. The Act received Royal Assent on 1 May 2018, having been passed by the Scottish Parliament on 20 March 2018.
The order is made under section 104 of the Scotland Act 1998, which allows for necessary or expedient legislative provision in consequence of an Act of the Scottish Parliament. In this case, provision is required in consequence of the aforementioned 2018 Act. It was requested by the Scottish Government and has been agreed between the UK, Scottish and Welsh Governments.
The 2018 Act and associated secondary legislation will complete the process of the devolution of forestry, which started with the Scotland Act 1998. The 2018 Act repeals the powers and duties held by the forestry commissioners, in so far as they relate to Scotland, and provide new powers to Scottish Ministers. The 2018 Act is due to be commenced on 1 April 2019.
Over the last decade, responsibility for forestry has been increasingly managed separately in England, Scotland and Wales. While forestry policy is a devolved matter in Scotland, the management of forestry, including Scotland’s national forest estate, has to date been undertaken by the forestry commissioners, who were designated as a cross-border public authority on devolution in 1999. In 2013, the functions undertaken by the forestry commissioners in Wales were transferred to Welsh Ministers and Natural Resources Wales. Selected functions continue to operate across Great Britain, including functions relating to forestry science and research, tree health, and common codes and standards.
As a consequence of the 2018 Act, and to facilitate the transfer of powers, it is necessary for the Government to lay two orders. One is made under sections 90 and 93 of the Scotland Act and is subject to negative procedure. The other—this order—is made under section 104, which is subject to the affirmative procedure. Once these orders and the 2018 Act come into force, the forestry commissioners will no longer have responsibility for the management of forestry in Scotland, which will instead be undertaken by Scottish Ministers.
It is a pleasure to serve under your chairmanship, Mr Robertson. On the cross-border question, a significant number of forests straddle the Scottish-English border. I looked in vain for a definition of who would deal with those forests, how that would be identified and whether Ministers in Scotland may—probably rightly—be able to influence the management of the forests south of the border, because they are a single forestry unit.
The hon. Gentleman is absolutely right to raise that point. For clarification, the order makes provision for cross-border arrangements that may be entered into by Scottish Ministers, the forestry commissioners and the national resources body, in the case of Welsh Ministers. The jurisdictions concerned are England, Scotland and Wales, and a memorandum of understanding is being drafted to agree who will be responsible in these territories.
The order will enable the 2018 Act to be implemented in full. It provides new powers to Scottish Ministers and makes a number of consequential amendments to reserved legislation, with a particular focus on the Forestry Act 1967. Articles 3 and 4, along with similar provisions in the negative procedure order I mentioned earlier, will enable cross-border arrangements to be entered into by Scottish Ministers, the forestry commissioners and various other bodies. While forestry functions and management of the national forest estate will be fully devolved, the order will enable Scottish Ministers to enter into arrangements with other bodies so that each may deliver certain functions on the other’s behalf. This will avoid unnecessary duplication of functions across Administrations and will allow for refreshed and strengthened cross-border co-operation and partnership working between England, Scotland and Wales, as well as for a co-ordinated approach to issues such as the management of plant-based pests and diseases to continue.
Article 5 will confer powers on Scottish Ministers to promote, develop, construct and operate installations for or in connection with the generation, transmission, distribution and supply of electricity produced from renewable sources and to use electricity produced by virtue of these powers.
The Minister is being generous with his time. With regard to article 5(4), I have two questions. Fossil fuels are defined as coal and natural gas, including substances
“produced directly or indirectly from a substance”
mentioned in this paragraph. What would the situation be with regard to waste incineration for the production of electricity, given that the majority of the waste that is incinerated originated as a fossil fuel? I am thinking in particular of the plastics.
Secondly, the biomass industry has a great effect on the timber industry because, effectively, it removes elements of that industry that previously went into furniture making and that have now gone to biomass. Has the Minister’s Department considered the effect of removing from the timber industry the product that is now intended to go to biomass?
As a former chairman of the all-party parliamentary group on biomass, I can assure the hon. Gentleman that great quantities of the biomass produced are not produced in Great Britain in the first instance. The product that is not used in the timber industry or for furniture tends to be waste product—thinnings and elements of forestry that could not be used anywhere else. I hope that satisfies the hon. Gentleman. The order covers renewable sources of energy, not fossil fuel waste. It does not change the situation in that regard, and fossil fuel waste would not appear to be considered as a renewable energy source.
These powers are currently exercisable by the forestry commissioners in Scotland. When the Forestry Act 1967 is repealed, as it relates to Scotland, it is necessary to transfer these functions to Scottish Ministers to ensure they have the same powers the forestry commissioners have under the current arrangements. The order also makes a number of consequential amendments to the Forestry Act 1967, related statutory instruments and other primary legislation to reflect the removal of the forestry commissioners’ functions in or as regards Scotland.
UK and Scottish Government Ministers and officials have worked closely to ensure this order makes the necessary amendments to legislation covering Great Britain in consequence of the 2018 Act. It represents the final stage of devolving forestry to the Scottish Government. It is necessary in consequence of the 2018 Act and demonstrates the Government’s continued commitment to working with the Scottish Government to make the devolution settlement work. I hope Members will agree that the order is a sensible use of the powers in the Scotland Act 2018 and that the practical result is something to be welcomed.
It is a pleasure to serve under your chairmanship, Mr Robertson. The order in front of us today makes provisions in consequence of the Forestry and Land Management (Scotland) Act 2018, and essentially follows on from section 81 of that Act. Section 81 provides that the functions of the forestry commissioners, which are exercisable in or as regards Scotland immediately before the date on which that section comes into force, are no longer exercisable in or as regards Scotland. It would be helpful for the Committee if I give a brief overview of the order before seeking clarity on some issues within it.
First, articles 3 and 4 relate to cross-border arrangements. Article 3 makes provisions for cross-border arrangements between Scottish Ministers and other bodies. Article 4 makes provision for cross-border arrangements between the forestry commissioners and Scottish Ministers for the purposes of carrying out the former’s functions as set out in article 4(2).
Secondly, article 5 makes provision to allow Scottish Ministers to construct renewable energy installations and generate, transmit, distribute, supply and ultimately use the electricity produced from these sources for the purposes of carrying out the Scottish Ministers’ functions, as detailed in article 5(2). Finally, article 6 and the schedule make necessary consequential modifications to primary and secondary legislation as a result of the 2018 Act.
The order is fairly non-contentious and is, as I have detailed, necessary to make consequential provisions as a result of the 2018 Act. However, I would appreciate it if the Minister could clarify some areas where I have concerns.
Article 3 seems to contain a fair amount of scope for cross-border arrangements between Scottish Ministers and other persons or bodies, and Welsh Ministers are included in that list of other persons. Is there a particular reason for specifying only Welsh Ministers here, and not Ministers of the Crown in different Government Departments, for example?
As far as I can tell, regulation making is also not devolved as part of this statutory instrument. What mechanisms are in place to ensure that regulations are not being made elsewhere that would hamper the ability of Scottish Ministers to carry out their newly devolved functions?
Article 5 makes provisions for Scottish Ministers to develop, construct and operate installations for the generation, transmission, distribution and supply of electricity produced from renewable sources. I would be interested to hear the Minister's thoughts on how this works in conjunction with schedule 5, head D of the Scotland Act 1998. Head D deems that the generation, transmission, distribution and supply of electricity shall remain reserved. I understand that the difference here is about generation as part of a renewable energy programme and that these powers are already held by the forestry commissioners, but given that we live in particularly turbulent political times, what processes have been put in place to ensure that Scottish and UK Ministers are aware of the respective boundaries of their powers and do not inadvertently stray into one another's territory? There is a risk of this issue becoming politicised and ultimately confused, as the nuance is rather technical, so demarcation could be better defined.
Finally, I have more of a general query for the Minister. As a consequence of this order, a few changes are made to primary and secondary legislation covering a couple of different policy areas. How does the Minister see these changes fitting into the common UK frameworks agreed between the UK Government and the Scottish Government?
My hon. Friend raises the issue highlighted in part 2 of the schedule—on modifications of subordinate legislation—and indeed the frameworks. I draw the Committee’s attention to paragraph 66, which discusses the Plant Health (Wood Packaging Material Marking) (Forestry) Order 2006. A significant amount of the palleting used in the United Kingdom to export goods into the European Union fails to meet EU regulations, which means that it cannot be used in the case of a no-deal Brexit. Does my hon. Friend therefore agree that the order may be a missed opportunity to deal with bioprotection with regard to wood offcuts, particularly dry kiln heating wood to make sure it is safe?
I thank my hon. Friend for his typically forensic analysis of the detail and for making that pertinent point. Perhaps the Minister can offer a more interesting analysis of that impact. My understanding is that there is to be no divergence from current regulations in the event of a withdrawal agreement being ratified by the House of Commons, but I am not entirely clear on what happens if there is no deal and we crash out of the EU on Word Trade Organisation terms. Does the Minister see this order as having an impact on that arrangement, regardless of whether there is a deal?
We welcome the Minister’s comments on the statutory instrument. We welcome the transfer of powers to Scottish Ministers overall. Of Scotland’s landmass, 19% is under forestry or woodland, which adds £1 billion to the Scottish economy every year and is responsible for maintaining 25,000 jobs in the industry.
“Scotland’s Forestry Strategy 2019-29” outlines several ambitions, including to have a more sustainably managed forestry and woodland structure; to expand areas of forestry and woodland; to look at wider land use issues around forestry and create economic opportunities around that; and to bring more efficiency and productivity into the industry. Overall, we welcome the measures, and we hope that the transfer to Scottish Ministers will enhance the chances of delivering that strategy over the next 10 years.
I thank hon. Members and the shadow Minister, the hon. Member for Glasgow North East, for their valuable contributions. The shadow Minister raised a couple of points. On cross-border issues, arrangements between UK Ministers and Scottish Ministers are provided for in a separate Order in Council, using specific powers in the Scotland Act for that purpose, so there is no confusion over the arrangements. As I mentioned earlier, a memorandum of understanding is being drawn up to ensure that those lines are clearly demarked.
On the salient point from the hon. Member for East Lothian about plastics, the incineration of plastics is not specifically addressed in article 5, which confers broad powers on Scottish Ministers to develop renewable energy installations. This is simply a continuation of the forestry commissioners’ existing power under the 1967 Act. The consequential amendments in the schedule to the draft order simply tidy up UK primary and secondary legislation in consequence of the devolution of forestry to Scottish Ministers.
I am not aware of whether it is specifically excluded or included for that purpose, but I am more than happy to write to the hon. Gentleman on that serious point, which needs addressing.
The shadow Minister raised electricity generation. That is very much a reserved matter, which is why the draft order, which has been made by the UK Government, is able to confer the power to develop renewable installations. The conferral of those specific functions on Scottish Ministers does not affect the reservation of energy matters set out in article 5.
The Government are absolutely committed to strengthening the devolution settlement for Scotland, and we continue to work collaboratively with the Scottish Government to that effect. I hope the draft order, which completes the devolution of forestry responsibilities to Scottish Ministers, demonstrates that commitment. On that basis—
I am grateful to the Minister for indulging me in my series of questions—I felt it was easier to do things this way than to give a speech. My final point regards the Forestry Commission. It is not losing its legal responsibility, because the draft order will allow it to enter into arrangements with Scottish Ministers. For clarification, where do the Government think that the legal responsibility to the public will lie—with the forestry commissioners, whose powers have been devolved, or with Scottish Ministers?
My understanding is that this is a tidying up of the statute book on the back of the 2018 Act and that it completes the devolution of forestry to the Scottish Government. I hope that that offers some clarity.
On that basis—taking my second opportunity—I commend the draft order to the Committee.
Question put and agreed to.
Draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019
The Committee consisted of the following Members:
Chair: David Hanson
† Allan, Lucy (Telford) (Con)
† Beckett, Margaret (Derby South) (Lab)
† Esterson, Bill (Sefton Central) (Lab)
† Harris, Rebecca (Lord Commissioner of Her Majesty's Treasury)
Hayes, Helen (Dulwich and West Norwood) (Lab)
† Hayes, Sir John (South Holland and The Deepings) (Con)
† Hollinrake, Kevin (Thirsk and Malton) (Con)
† Johnson, Dr Caroline (Sleaford and North Hykeham) (Con)
† McMorrin, Anna (Cardiff North) (Lab)
† Moore, Damien (Southport) (Con)
† O'Brien, Neil (Harborough) (Con)
† O'Hara, Brendan (Argyll and Bute) (SNP)
† Skidmore, Chris (Minister for Universities, Science, Research and Innovation)
† Smith, Jeff (Manchester, Withington) (Lab)
Thomas, Gareth (Harrow West) (Lab/Co-op)
† Warman, Matt (Boston and Skegness) (Con)
† Western, Matt (Warwick and Leamington) (Lab)
Zoe Grunewald, Committee Clerk
† attended the Committee
Third Delegated Legislation Committee
Tuesday 5 March 2019
[Mr David Hanson in the Chair]
Draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019
I beg to move,
That the Committee has considered the draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019.
It is a pleasure to serve under your chairmanship, Mr Hanson.
The framework for protecting intellectual property is a vital part of our industrial strategy. The UK’s strong IP system drives creativity and showcases UK innovation. Leaving the European Union will not change that. We will continue to deliver quality rights-granting services, lead the world in IP enforcement and engage in international IP discussions.
This draft statutory instrument uses powers provided by the European Union (Withdrawal) Act 2018 to ensure that protection continues in the UK for registered and unregistered Community designs, and international trademarks and designs in the event of no deal. It also addresses other deficiencies in UK law that would arise on exit.
Under the EU designs regulation, the shape and appearance of a product can be protected under a registered Community design granted by the EU Intellectual Property Office. That system runs in parallel to our domestic system, so protection in the UK can currently be obtained by registration under either or both of the EU and UK systems.
Shape and appearance can also be protected under the unregistered Community design. That right is established automatically when a design is first shown to the public, and it is particularly valued by design-intensive sectors such as the fashion industry. As with registered design, the UK provides a parallel domestic system. However, the scope of UK unregistered design is different from that of the EU equivalent because protection is afforded only to three-dimensional designs.
In addition to the rights granted by the EU Intellectual Property Office, businesses can obtain EU-wide registered design and trademark protection through an international system administered by the World Intellectual Property Organisation. That system enables business to protect designs and trademarks in multiple territories via a single application, filed in one language. Both the EU and the UK are contracting parties to that system. As with registered EU trademarks and designs, international EU rights are protected through EU regulations, meaning that a failure to act will result in the protections afforded to those rights being lost.
The draft regulations in Committee provide replacement rights for those who own registered EU designs on exit day in the form of a “re-registered” UK design. For those holding unregistered Community design, we will preserve UK protection through the “continuing unregistered” design. The new UK rights will be fully independent of the corresponding EU right. However, they will retain the effective date of the EU design and, in the case of a re-registered design, any other relevant dates filed as part of the original EU application.
The scope of protection for EU unregistered designs is broader than that provided by existing UK unregistered design, so we are introducing a new type of UK right called supplementary unregistered design. By doing so, we will ensure that the full range of design protection provided in the UK before exit day will remain available after we leave the EU. That new right will function alongside existing UK unregistered design.
To ensure continued protection in the UK for international designs that are protected through EU designations under the Hague agreement, we will create comparable re-registered UK designs just as we are doing with registered Community designs. For international trademarks designating the EU, we will create a comparable UK trademark, using an approach similar to that set out in the EU trademarks exit SI, recently approved by both Houses; the Committee in this place was attended by several members of this Committee today.
As with re-registered designs and comparable trademarks created from registered EU rights, the new UK designs and trademarks will be fully independent of the corresponding international rights, but they will inherit their effective dates and be treated as if applied for and registered under UK law.
For those with registered Community design and international EU design and trademark applications that are pending on exit day, we will allow corresponding UK applications filed after exit day to claim the EU right’s earlier filing and priority date. To do so, an application must be submitted to the UK Intellectual Property Office within nine months of exit day.
The draft regulations also set out provisions to accommodate other particulars of EU and international design and trademark protection, including deferment of design publication and the use of subsequent designations to create multiple EU protections under a single international registration. The new UK rights can be challenged, assigned, licensed and renewed, so the instrument also sets out how such procedures will be accommodated. The IPO provided an outline of the changes through technical notices published last year, and it will provide full business guidance once the instrument has been made.
On pending applications, people have proceeded using the existing system and will reapply to the new system. Can the Minister assure us that there will be no delay there? If people have had an application in for some time, that could affect their business. Can the Minister send out a clear signal from the Government that those people will not be adversely affected?
I can absolutely give that assurance. I have full confidence in the IPO, in both London and Newport. I have visited the office to see its ongoing work in ensuring that the registration process is clear and consistent. When it comes to registered Community designs, it is important that the information is there—with many other issues, there is a lack of data—and that there is a simple transfer across. I am confident that that will minimise the impact on businesses; in fact, it will give them greater flexibility by providing that nine-month window for registration in the new UK-wide system.
I can confirm that there will be no additional cost to the businesses or to any rights holders wishing to register registered or unregistered designs. A schedule of payments has obviously been in existence for a while, and we brought it down significantly after the 2014 legislation. For instance, the £60 for a single application for an unregistered design is now down to £70 for 10 applications. With registered designs, the price has also come down, from £450 to approximately £150. I can touch on that later, but the important thing is that there is no cost for transferring registered design rights across to the new system. It is almost business as usual; we have just created a new system that continues the protection for rights holders.
The regulations are vital in ensuring that the intellectual property system continues to function if the no-deal outcome arises. They are essential for safeguarding rights, and for providing businesses with maximum certainty and clarity, and I commend them to the House.
It is a pleasure, as ever—but especially at this hour of the morning—to serve under your chairmanship, Mr Hanson.
I start by picking up one of the Minister’s comments. He said that this is business as usual—but if there is one thing that Brexit is not, it is that. We can probably all agree on that, whatever our stance on the subject.
I think, Mr Hanson, we are in danger of wandering into a slightly different part of the forest.
The Minister set out the arguments in favour of creating a system that addresses what will be needed in this country for both registered and unregistered designs to apply in the UK, and I have relatively few concerns about his remarks. However, as always with such regulations, there is the question of whether Opposition Members are in a position to give our full judgment on both the available information and the responses from the technical experts in the sector.
I put on the record, again, our concern about our ability to fully scrutinise what we are being asked to support. It is a common problem with regulations, often related to the speed with which they are being pushed through, their detail and technical content, and their importance. As ever, it is important to get that point across, as this is another example of costs—albeit the Minister is claiming that they are relatively small —for creating a functioning regime after we leave the European Union.
As the sifting Committee said in its report when it recommended that the draft regulations be considered in Committee,
“The work of conversion is clearly a major exercise.”
That work will involve 700,000 registered Community designs alone. The preliminary estimate is of £375,000, which may appear to be a relatively small amount of money, but that is clearly not without significant amounts of work. The Intellectual Property Office says that it is able to address that and that costs are recovered through fees. The Minister has pointed out that the fees have come down. I have no reason to doubt him on that, but it will take time, both for the authorities to process the change in arrangements and for businesses to make sure they are covered. I believe there is a nine-month window for businesses to adapt to the new regime—the Minister may wish to correct me on that. Perhaps he could also answer how the Government intend to make sure that everybody has the cover that they need and is aware of the changes that they need to make during that transition period.
I have one question for the Minister, the answer to which I did not catch in his opening remarks. Perhaps he can explain how the unregistered Community design system operates and how businesses obtain their protection without having to register for it. I note that there is a three-year period. Can he clarify how that system operates so that the protection is in place? From what he said, it is clearly an important part of intellectual property protection. Perhaps he could give us some clarity on how it operates.
As ever, there is the thorny issue of consultation or, to be strictly accurate, the lack of public consultation that we see with the regulations going through Committees every single week. I notice that no formal consultation was carried out, but that stakeholders were asked to give their opinions. Perhaps the Minister can tell us—I cannot find the information anywhere—who was consulted and what their responses were to those informal consultation discussions. It would have been very helpful to have that information in front of us; it would have helped to ensure that we were in the best possible position to judge whether we should or should not support the regulations. I hope that the Minister, if he does not already, will soon have a note on what the consultations were, who was consulted and what the responses were.
I want to tell the Committee of the key concern raised by the Alliance for Intellectual Property. It is not particularly concerned with the continuing regime in the UK; it is relatively confident that what the Minister has described meets its requirements. Its concern is the lack of reciprocity. If equivalent protection is achieved through the withdrawal Bill, it believes that the design sector will still be gravely at risk without reciprocal protection from the EU27. After we have left the European Union, designs that are first disclosed in the UK might well be sufficiently protected here, but will receive no unregistered Community design protection in the EU, because we will no longer be members. The AIP’s view is that this would have grave consequences for UK designers: according to a recent survey by Anti Copying In Design, almost 80% of them rely on the unregistered Community design right to protect their designs.
The EU is the largest export market for many UK design sectors, contributing over two-thirds of UK furniture manufacturers’ export revenue. Such a loss of reciprocity poses a serious threat to leading industry events such as 100% Design, London Fashion Week and Top Drawer, which creators from all over the world attend in order to reveal new and innovative designs. Without protection, designers will either have to run the risk of copying throughout the EU27 following disclosure, or simply avoid first disclosure in the UK altogether. Perhaps the Minister can advise on which route the Government think designers should take.
On the point about designers and furniture manufacturers, there is a company in my constituency—a small business, which exports to 70 countries around the world—that faces significant costs in the enforcement of this design legislation and is up against a lot of copycat manufacturers, particularly in the far east. The company will be especially exposed, because Europe is such a big market for it.
Using the example of his constituents’ business, my hon. Friend has set out the sector’s exact concerns and the challenge for the Government to ensure protection of our innovative and creative exporters. Given the end of the parallel system to which the Minister referred in his opening remarks, perhaps the Minister can tell us how the Government will provide assurances.
What is the state of negotiations on achieving protection in this area in the European Union? We cannot overstate the importance of that protection for businesses such as that of my hon. Friend’s constituents. I hope that there is an answer to that, and that the Minister can give us some assurances. We know that all too often negotiations on the details of post-Brexit arrangements have not gone as well as they need to—I hope that this issue is not one of those.
I asked the Minister about consultation. As ever, the approach to impact assessment is limited. Paragraph 13 of the explanatory memorandum discusses regulating small businesses. How well prepared will they be? This picks up on my earlier point on ensuring that all businesses are aware of the changes that will happen and the actions they need to take. Again, the Government have chosen a very narrow interpretation of “impact” in their approach to impact assessment; they are not taking the wider impact on the economy as a whole. As I said on previous occasions, that is regrettable and does not set out the true impact of regulations such as these.
That brings me to a number of questions that arise from the commentary in the explanatory memorandum. Can the Minister explain how the system will work for existing rights that are granted by the European Union’s IPO? I am not entirely sure whether that question follows on from that asked by the right hon. Member for South Holland and The Deepings, but I think it is similar. If the Minister has not already answered it, perhaps he can pick up the point about ongoing validity for five years.
My next question is about paragraph 2.8 of the explanatory memorandum, which references action being taken by EU rights holders and their protections in the UK. My assumption is that those rights holders will be protected in the UK, and that the concern is about that lack of equivalence. Perhaps the Minister could clarify that point, along with the ones about protections of UK designers in the EU.
According to paragraphs 7.17 and 7.27 of the memorandum, 12,000 international trademark applications and 1,000 design applications are estimated to be pending on exit day. How are the Government making sure that all those applying know that they need to file a new application? That point is similar to the earlier questions about making sure that all businesses understand what they need to do.
Paragraph 13.3 of the memorandum states that
“there is sufficient time for all businesses to familiarise themselves with the changes”
before the regulations take effect, but there is a difference between there being time and businesses taking up the option. Certainly, many small businesses are not always equipped to address the regulations that come to them, so I really want to press the Minister on the impact on our small and medium-sized enterprise community.
In paragraph 7.33, there is a reference to
“the right to opt out”.
Again, what are the Government doing to make sure that businesses are fully aware of the options available to them, which are referred to in that paragraph?
I think this is my final question—[Laughter.] I am sure I can find some more if Members want me to, but on balance, I will stick to this one. The memorandum refers to fees of £63,000. Are those fees payable by businesses of all sizes, and is that going to continue to be the case? The Minister mentioned lower fees in his opening remarks, so perhaps he could link what he said then with the figure of £63,000 cited in the explanatory memorandum.
The example that my hon. Friend the Member for Warwick and Leamington gave about the furniture manufacturer in his constituency demonstrates how important it is that we get these regulations right and have arrangements in place. It is particularly important for designers for whom the EU is a major market; as we have heard, two thirds of designers export to the EU. I would particularly like to hear the Minister’s answer about reciprocal arrangements, and I hope he is also able to answer the other questions that I have asked.
I thank the hon. Member for Sefton Central for the contribution he has made to this debate, as well as the other right hon. and hon. Members who have contributed through interventions. I will endeavour to respond to the questions that have been raised.
I will first turn to the issue of public consultation, which has been familiar terrain in several of these no-deal statutory instrument Committees. The Intellectual Property Office has been engaging with businesses about the implications of exit since the referendum result, and I will turn to that engagement in a moment. The Department has used the existing Cabinet Office principles for consultation on all EU exit SIs and non-exit SIs, and details of any consultations undertaken are explained in all SIs’ accompanying explanatory memorandums. The Government have sought to maximise continuity in a no-deal scenario. At the early stages of the negotiations on the future partnership, as I have explained before in previous Committee debates, revealing the details of our continuity approach to public consultation would have risked our negotiating position.
It is important to reflect on the fact that the process of the negotiations is one that we do through Brussels and across 27 other member states. It is right that we take a nuanced position. I note, however, the hon. Gentleman’s support for President Trump in this debate.
The individuals who took part in the technical review did so in a personal capacity. They were chosen because of their past experience as representatives of various stakeholder bodies, usually engaged in consultation with the IPO. The technical review required a fairly detailed knowledge of legislation—its practical implications as well as the context of the wider industry—and the framework of the EU international trademarks and designs legislation as a whole. We are confident that those individuals have the relevant knowledge and will be able not only to follow the approach being taken by the instrument in order to follow and identify any errors, but, importantly, any other issues that we might have missed. In no way was the IPO looking for people who would just agree with the approach or raise no issues. Although it is important for us, that would not have been for anyone’s benefit. Indeed, the discussions at meetings were robust and forthright, and attendees were keen to challenge the instrument and make sure it was the best possible going forward.
In terms of the consultation process and the individuals acting in a personal capacity, I am not sure whether I have the authority to divulge their names on the Floor of the Committee at this particular moment. Perhaps I can write to the hon. Gentleman if I can request their permission to be named. They acted in a personal and private capacity as part of the consultation following the Cabinet Office statutory instrument guidelines on consultations. The framework and process was a trusted one. I am sure that having an opportunity to give private views provided for a greater opportunity to scrutinise the legislation and to be more honest and robust as a result.
We assessed the impact of the SI using the better regulation framework in line with the Treasury’s Green Book guidance. It was obviously deemed to be less than £5 million, so a full impact assessment was not required. Analysis has been focused on the direct impact of the relevant SI compared with current legislation, and analysis of wider impacts on the UK’s exit from the EU has been previously published in the form of long-term economic analysis, which was published in November 2018.
On the impact on business and the conversion of existing rights to comparable UK rights, we have committed to ensuring that the administrative burden on business is minimal. The teams at the ICO are making good progress on numbering systems for the new comparable rights and will communicate the changes as soon as possible. The IPO will also publish guidance in every language of the EU on its website so that rights holders in every member state will be able to access all the necessary information on their UK rights.
When it comes to the process of notification both within the EU and the UK, the IPO will publish a standard website notice in all languages, as I have said, confirming that holders of re-registered UK designs and comparable UK trademarks have been granted equivalent UK rights. The notice will continue to remain on the website after exit, and individual notifications to holders of EU and international trademark designs will not be issued. We are confident that there has been significant interest that will be progressed towards the guidance being published.
If rights holders do not want to be given the new rights, the statutory instrument contains an opt-out provision that allows the holder of a comparable UK design or trademark to request that it be treated as if it was never registered in the UK. That process can be exercised via completion of a no-fee letter or email to the registrar, requesting an opt-out.
Several issues related to costs for businesses. This has been covered in interventions, but I state again that there will be no fee associated with the creation of the new UK rights. The comparable UK registered design or trademark rights will be independent from the corresponding EU rights. Obviously, there will continue to be charges for renewal. When the comparable UK right expires, the standard UK renewal fees will apply. In terms of comparable UK registered design, the renewal fee, which will be the same as it is at the moment, will increase for each successive five-year period of protection, from £70 for the first renewal up to £140 for the fourth and final renewal period. That is consistent with current practice. The holder of the comparable UK registered design will be required to pay these UK renewal fees in addition to those associated with the corresponding EU right in order to preserve protection in both the UK and the EU. For a comparable UK trademark, renewal fees will be charged according to the goods and services protected under the mark.
The hon. Member for Sefton Central raised the issue of the costs for Government—trading funds. The IPO receives no central Government funding, so costs are recovered through fees. In terms of the process for creating UK comparable rights, the actual process will be automated. Because these rights are currently valid and enforceable in the UK, the IPO already has access to related data—these are recorded in the IPO’s records system and published on web-based search platforms—and as a result we will be able to create the new comparable UK rights without a significant amount of additional work.
When it comes to the issues about preparation for EU exit by the IPO, resources have been managed as part of the preparations. That includes staff recruitment and training. The creation of new rights on exit day will not itself create a need for additional resources beyond those already being addressed as part of our business-as-usual operational management.
Can the Minister—perhaps in writing, because I assume that he will not have the numbers at his fingertips—provide detail about the staffing that has been brought in, to provide reassurance to businesses? They are really concerned. Intellectual property, as we well know, is an incredibly valuable thing for this country, and it would be very helpful for us to explain the scaling up that has been going on in that department.
I thank the hon. Gentleman for his point. I would be happy to write to him with some of the details on the resource issues of staffing. I went to visit the IPO’s headquarters down in Newport and was deeply impressed by the organograms and the plans that it had put in place. Almost week by week and day by day, it has been planning for EU exit. Its staff morale is one of the highest for a Government organisation across the country, not just in Wales. I really got the sense that the IPO was content with the process, was managing the process and was a happy organisation in taking forward the process, but I will write to the hon. Gentleman on some of those details. I got no sense that there was undue pressure on the IPO as a result of the changes taking place.
Let me turn to the issues raised about designers and disclosure of unregistered designs. An unregistered design will need to be first disclosed in the EU to be protected in the EU should we leave without a deal. However, disclosure in the EU may have implications regarding any corresponding UK unregistered rights, such as the supplementary unregistered design and the existing UK unregistered design rights. This statutory instrument contains provisions to allow us to negotiate reciprocal arrangements on first disclosure with third countries, which may be the EU, individual countries within the EU, or more widely, but that will still be subject to future agreement.
If we retain first disclosure in the EU as a basis for establishing post-exit UK unregistered design, we will create an imbalance between the UK and EU systems, providing EU-based designers with an unfair advantage. Designs disclosed in the EU would count for establishing both UK and EU protection, whereas designs disclosed in the UK would count for establishing UK protection only.
The law in this area remains unclear, with prominent legal commentators disagreeing on the subject, but our approach reflects the published interpretation of the EU IPO. We think that that provides a more consistent approach for designers to understand and apply. The approach may be subject to future change if courts decide to take a different interpretation, but the SI does recognise disclosure in other qualifying territories, and although we will not have a reciprocal arrangement with the EU on exit day, we may have the opportunity to reach such an arrangement in the future.
The Minister’s answer on that point justifies the concerns raised by the Alliance for Intellectual Property, some of which I listed. He gave great cause for concern about the uncertainty and the differing legal opinions there. Can he give the Committee an indication about the discussions that have already taken place with our EU counterparts on how we achieve a reciprocal arrangement and what estimate the Government have at the moment of how long it will take to reach a system where we can avoid the problem he set out, which is of real concern, over damage being caused to a designer by registering in one jurisdiction and not in any other?
The context of Government negotiations have been prioritised around that future relationship and finding a deal with the European Union. I am sure that, having raised these points of uncertainty, the hon. Gentleman will want to vote for this deal, to ensure that he can—there is no point in frowning at me. In every Committee meeting we come to, the hon. Gentleman raises points of concern and then goes into the House of Commons and votes the opposite way. Designers need to know that the hon. Gentleman is taking an approach that will provide maximum possible uncertainty to the sector. For him to raise these points here today is completely paradoxical to the approach that he takes in the Chamber.
We have agreed provisions on IP that will provide legal certainty and protect the interests of rights holders in the withdrawal agreement. It is important for the Committee that I place this on the record. It includes that registered Community designs should continue to be protected in the UK after the implementation period; that existing unregistered Community designs should continue to be protected in the UK after the implementation period; that the UK should take measures to ensure that international trademarks and designs designated in the EU, which are protected prior to the end of the implementation period, continue to enjoy protection in the UK; that IP rights exhausted in the UK and EU before the end of the implementation period shall remain exhausted in both areas; and that UK legal representatives will be allowed to continue to represent their clients before the EU IPO in cases that are ongoing at the end of the implementation period and in addition to the implementation period, which means that the current regime and arrangements for intellectual property will continue to operate as they do now until the end of that period. The provisions ensure that existing EU-level IP rights and the international rights designated in the EU will continue to be protected in the UK after the end of the implementation period.
I am sorry to sound so passionate about the deal, but I truly believe that, when it comes to IP, the deal is the best possible solution on the table to ensure that we can protect the interests of rights holders. I urge the hon. Gentleman to vote for it.
The problem is that, whatever deal goes through—and even if we leave without a deal—the same problem applies: that this issue of registering either in the EU and affecting UK rights, or registering in the UK and affecting EU rights, applies. That is the bit that has not been resolved. It is a complete red herring to say that which deal we vote for affects the outcome of these regulations.
As I said, we have got this as the withdrawal agreement going forward; however, we must also turn to the issue of the future partnership. Arrangements on future co-operation will be a key part of the future partnership. We will seek a comprehensive arrangement on trade that will cover a wide range of sectors, including IP. As part of going forward with that future relationship, the UK will continue to explore participation within the unitary patent system and the unified patent court. It is important that we reflect on that going forward.
In summary, I want to make sure that when we come to consistency, UK law says that anyone who lives in or carries on a business in a member state can claim UK unregistered design protection. That is because of section 217 of the Copyright, Designs and Patents Act 1988, which says any qualifying person—that is, any person who lives in and runs a business in a qualifying country, as defined to include member states—can claim the UK unregistered design right. We did not make any change to that. After exit day, people in businesses in the EU will continue to claim the UK unregistered design right while people and businesses in the UK would lose that equivalent right in the European Union. That creates an imbalance between UK rights holders and EU rights holders that we must change. UK law is therefore being amended to limit the geographical criteria for a qualifying person to claim the UK unregistered design protection. That is important for providing certainty, clarity and consistency, above all, as part of this SI.
I hope that my answers have been helpful. These regulations are an absolutely necessary part of making sure that the IP continues to function if no deal is agreed. Above all, I hope that Members will consider that a deal will be in the best interests of IP rights holders; but I also hope that the Committee will now support this statutory instrument today.
Question put and agreed to.
That the Committee has considered the draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019.