That the Grand Committee do report to the House that it has considered the Electronic Commerce Directive (Hatred against Persons on Religious Grounds or the Grounds of Sexual Orientation) Regulations 2010.

Relevant document: 5th Report from the Joint Committee on Statutory Instruments.

My Lords, these regulations are a technical measure to implement the EU directive on electronic commerce—known conveniently as the e-commerce directive—in respect of the offences in Part 3A of the Public Order Act 1986. The regulations will enable us to commence the offences of stirring up hatred on grounds of sexual orientation. The offences themselves are found in the 1986 Act. They were inserted by the Criminal Justice and Immigration Act 2008. I will not go into the details of the offences here; this is not the right place to have that debate. We want to commence those offences as soon as possible. The regulations also implement the e-commerce directive in respect of the offences of stirring up religious hatred. That also appears in Part 3A of the Public Order Act 1986.

The e-commerce directive plays a significant part in the way that Europe ensures free movement of services within the European economic area. Meeting our obligations under the directive is of importance and helps to ensure a level playing field for service providers.

The directive deals with providers of “information society services”—which are, broadly speaking, commercial activities that take place online. It covers a wide range of online activities, such as selling goods and services, as well as video on demand, hosting a website or providing web or e-mail access. As I said, the directive deals with commercial services provided online and how the providers of such services should be regulated by member states. Such regulation includes the criminal law, if that law affects providers of information society services.

The directive applies to the offences of stirring up hatred on religious grounds and on grounds of sexual orientation. Those offences can cover stirring up hatred through any medium, so it is possible to commit the offences by providing commercial services online.

Turning briefly to the detail of the regulations, I say that Regulations 3 and 4 implement the directive’s “country of origin” rules. Those rules broadly say that a provider of information society services must be regulated by the law of the state in which the provider is established, not the law of the state in which the services are received. That is what Regulation 3 does.

Similarly, the “country of origin” principle has the effect that the UK must not restrict the freedom of service providers established in another European economic area state to provide their services in the UK unless certain conditions apply. Such providers will generally be regulated by the other state in which they are based. Therefore, Regulation 4 provides that proceedings for these offences may not be brought against a service provider from another European economic area state, unless specific conditions are satisfied relating to the public interest.

Of course, intentionally stirring up hatred on either ground is a serious offence. In practice, it is therefore likely that the public interest conditions would always be met in such cases.

Regulations 5 and 7 implement the requirements of the directive in relation to intermediary service providers. These are mere conduit providers that cache or host information. The directive requires us to limit the liability of such intermediary service providers.

I will briefly mention some of the history regarding implementation of the directive, which was originally implemented by regulations in 2002. Those regulations applied the directive to all legal requirements then existing, therefore including all offences that existed at that time. For offences passed after that date, we have to implement the directive on a case-by-case basis.

I mentioned that the draft regulations cover the offences of stirring up hatred on the two grounds. The offences of stirring up religious hatred were created by the Racial and Religious Hatred Act 2006, which added a new Part 3A into the Public Order Act 1986. The directive was implemented in respect of the religious hatred offences by regulations in 2007.

The Criminal Justice and Immigration Act 2008 extended the offences in Part 3A to include stirring up hatred on grounds of sexual orientation. These regulations are therefore necessary to implement the directive in relation to the extended offences in Part 3A. They will do so in a way which ensures that implementation will be consistent for all the offences in that part.

The regulations are made under Section 2(2) of the European Communities Act 1972. That Act provides that regulations made under Section 2(2) cannot result in the imposition of a penalty of more than two years’ imprisonment. That produces an unfortunate and undesirable anomaly. The offences in Part 3A of the 1986 Act carry a maximum penalty of seven years’ imprisonment. If the two-year penalty limitation were to be applied to the regulations, it would mean that offences committed by an England and Wales service provider elsewhere in the EEA would attract a maximum penalty of only two years, whereas the identical offence committed here would attract a seven-year maximum.

To resolve that anomaly, Section 143 of an Act that noble Lords will well remember, the Coroners and Justice Act 2009, provides that the penalty limit will not apply to regulations made to implement the e-commerce directive. The same issue arises for the EU services directive, and Section 143 applies to both. That section came into force when the 2009 Act was given Royal Assent. The regulations make use of that section and will ensure that the penalties available for offences committed under Part 3A are always the same.

At the same time, to ensure a consistent approach, we are revoking and replacing the previous regulations that covered the religious hatred offence. Those were made in 2007, so the anomaly I have just mentioned applies to them. These regulations will correct that anomaly. There will be a single set of regulations covering all the offences in Part 3A of the Public Order Act 1986.

I began by saying that the regulations would enable us to bring into force the offences of stirring up hatred on the grounds of sexual orientation. We intend to do that as soon as possible.

My Lords, I thank the Minister for introducing the draft statutory instrument, which he described as a technical measure. I have to say that it is a very technical measure, which I had considerable problems trying to understand as I travelled down on the train this morning. I was of the view that this might be legislation by obfuscation, in that I found it difficult to understand what on earth it was getting at. I was grateful for the Explanatory Memorandum, which at least had—as always—something about what was being done and why, under paragraph 7 on the policy background. Even then I was still somewhat confused, and I have only one or two questions to put to the noble Lord.

First, I noted the title, but could not work out why race and sex—for example—were not included in the list of things that discrimination might be applied to. They might be covered by other regulations that I have had the privilege of listening to the Minister describe on an earlier occasion.

My next point—again it is very minor, but perhaps the noble Lord will be able to help me—is that the Explanatory Note to the regulations explains, in the last paragraph, that a transposition note has been prepared. I understand that I can get that from the Criminal Law Policy Unit at the Ministry of Justice. No doubt I ought to have got hold of it before this debate. Perhaps the noble Lord can tell me what is in the transposition note, and in the regulatory impact assessment that was prepared by the Department for Business, Innovation and Skills. No doubt the noble Lord referred to that in his opening speech, but I missed it. I would be grateful for an assurance from him that there is no major regulatory impact, which is why the assessment was made.

I have no further points to make on the regulations.

My Lords, as the Minister describes it, this is a technical measure and I, too, was slightly confused by it. I decided that this was due to it being above my pay grade, rather than being unclear also to those who were slightly better versed in the measures. It is somewhat clearer to me now, after the Minister gave us such a clear explanation, for which I thank him.

As we understand it, the regulations on information society services are tweaked to fit in with the amended Part 3A of the Public Order Act 1986. They are narrow regulations, constrained in their scope. We hope that they will be applied proportionately. We are in broad agreement with them, but seek one or two clarifications. The first is on the “country of origin” rules. While I understand the way that they will work in England and Wales and in other EEA states, what is not immediately clear is what happens if an offence of stirring up religious hatred or hatred on the grounds of sexual orientation under UK law is committed when the commercial service provider is not based in either the UK or the EEA area—when it is based, for example, in the Middle East or another part of the world. Do we have any mechanisms to deal with that material? This is a wide question, and I will understand if the Minister cannot deal with it today.

My final question is: can the Minister give us an indication of when the regulations will come into effect? He said that he wanted them to come into effect as soon as possible; I wonder whether he has some dates in mind. Will he also clarify whether only England and Wales are covered by the regulations, or whether Scotland and Northern Ireland are also included?

I am grateful to both noble Lords for their support and contributions. I am delighted that these technical regulations have become marginally clearer as a consequence of my describing them. I will attempt to answer the questions raised.

On the issue of racial and sexual equality, the Acts of Parliament that established offences in that area came before the 2002 directive, and existing regulations cover the position adequately at the moment. There is no major regulatory impact, I am glad to say. The transposition note simply states, in tabular form, how the regulations implement each requirement of the directive. With regard to the other matters, we hope to put this part of the Act into effect in weeks rather than months. That is the best I can do regarding that.

Could a provider based, for example, in the US or the Middle East commit an offence here? A person who commits the offence in England and Wales is liable, so if a service provider commits the offence in the course of providing their services in England and Wales they will be guilty like anyone else. The relevant material to meet the threshold of the offence would need to be threatening and intend to stir up hatred on the grounds of either religion or sexual orientation, but the regulations do not impact on non-EEA providers.

Like anyone else, Scottish service providers that commit the offence in the course of providing their services will be liable for the offence, but the offence extends only to England and Wales so Regulation 3, which extends the liability of service providers to acts committed in other European economic area states, applies only to service providers established in England and Wales.

I am grateful to both noble Lords for their contributions.