Sanctions (EU Exit) (Consequential Provisions) (Amendment) Regulations 2020

Motion to Approve

Moved by

That the draft Regulations laid before the House on 16 September be approved.

My Lords, before I introduce this SI debate, I want to express on behalf of my right honourable friend the Foreign Secretary his response to the horrific events in France today. He issued the following statement:

“The United Kingdom stands with France today in sorrow, shock and solidarity at the horrifying events in Nice. Our thoughts are with the victims and their families, and we offer every support to the French people in pursuing those responsible for this appalling attack.”

I am sure those sentiments resonate with everyone in your Lordships’ House.

I turn to the instrument before us. It was laid on 16 September under the powers provided by the Sanctions and Anti-Money Laundering Act 2018. It will aid the investigation and prevention of terrorist financing; prevent designated persons acting as charity trustees and managing or operating sensitive financial enterprises; and enable the effective implementation of legal, operational and regulatory measures for combating terrorist financing.

We have also laid alongside this draft instrument a Section 46 report. The report is required when new regulations are made under Section 45 of the sanctions Act to amend sanctions regulations made for a discretionary purpose under Section 1 of the sanctions Act. The report details why I consider that the relevant conditions, set out in Section 45 for the use of this power to make amending regulations, are met.

The purpose of the instrument is to add new provisions to three existing 2019 regulations relating to counterterrorism sanctions. These new provisions in the 2019 regulations will in turn make amendments to several other pieces of primary and secondary legislation to replace and update references to counterterrorism sanctions legislation. That needs to be done to ensure that the new counterterrorism sanctions framework established by the 2019 sanctions regulations delivers substantially the same policy effects as the existing sanctions regimes after the end of the transition period.

The three regulations amended by this instrument, collectively known as the 2019 regulations, are the ISIL (Da’esh) and Al-Qaida (United Nations Sanctions) (EU Exit) Regulations 2019, made on 5 March 2019; the Counter-Terrorism (International Sanctions) (EU Exit) Regulations 2019, made on 14 March 2019; and the Counter-Terrorism (Sanctions) (EU Exit) Regulations 2019, also made on 14 March 2019. The provisions of primary legislation that will ultimately be amended by the 2019 regulations as a result of the amendments made by this instrument are Section 49(3) of the sanctions Act and Section 178 of the Charities Act 2011.

I shall provide further details: Section 49 of the sanctions Act confers a power on the appropriate Minister to make regulations for the purpose of enabling or facilitating the detection, investigation, or prevention of terrorist financing. This will, for example, enable the Government to amend or update the existing Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, which currently include measures to tackle terrorist financing.

My Lords, I thank the Minister for the expert and diligent way in which he explained these regulations. I welcome them and I take the opportunity to welcome the noble Baroness, Lady Hoey, to this House. I am sure her voice will be heard regularly. Our paths have diverged considerably since we worked together as young Labour parliamentary candidates 40 years ago, but I am sure she will make a big contribution.

Will the Government impose sanctions on the former South African business brothers Ajay, Atul and Rajesh Gupta, who were responsible for looting from South African taxpayers around 7 billion rand, or around £350 million sterling, which was laundered abroad through British-based banks such as HSBC, Standard Chartered and the Bank of Baroda? The Minister may say that the current Magnitsky-type sanctions in our legislation focus upon human rights rather than financial crime, but in this case the two are indelibly interconnected. For example, looting from a government-funded project for poor farmers in the Orange Free State in South Africa left them penniless and unemployed, with massive damage to their rights and freedom simply to live—and London’s financial system was complicit.

Human rights are not just constitutional and civil but social and economic, especially when they are attacked by financial crime, as in this case. I have raised this repeatedly before and have still had no formal reply on the Financial Conduct Authority investigation into HSBC, triggered by my letters to the Chancellor in September and October 2017. I introduced a whistleblower to the Financial Conduct Authority but still have no idea what the outcome was. If the Minister is not able to respond in detail this afternoon, can he please write to me answering the points I have made?

I too thank the Minister for his very thorough introduction. My question is very simple. We are still in negotiation with the European Union about the continuation of agreements between us and it after Brexit. Can the Minister give us an assurance, as I hope he will be able to, that the regulations we are about to approve will function properly if we withdraw from any co-operation agreements we have with the European Union about criminality in general, as opposed to money laundering and terrorism? Unless they do, I cannot see the reach of these new regulations extending worldwide, as I believe it must, since terrorism is a worldwide disease and not confined to the United Kingdom.

My Lords, I thank my noble friend for introducing these sanctions and for making the statement in regard to the atrocities today in France. I also take this opportunity to welcome the noble Baroness, Lady Hoey, to this House and wish her many happy years of service in this place. I look forward very much to hearing her maiden speech.

My noble friend the Minister will be aware that terrorism knows no borders. My question is not dissimilar to that from the noble Lord, Lord Bradshaw. Is my noble friend absolutely convinced that the regulations we are approving today will, in and of themselves, provide him with all the tools at the disposal of the Foreign Office and the other departments to which he has referred? They will need them. The most effective action in controlling the financing of terrorism, which we have traditionally followed, has been through the UN; much more recently, in the last 40 or 50 years, it has of course been through the European Union. Will he assure me this afternoon that, even though we have left the European Union, we will work completely at one and closely with its members, in addition to the Five Eyes?

The atrocities in France, today and recently, have taught us that we must be ever vigilant for terrorist attacks, while recognising that perpetrators may travel freely across borders. I believe it is incumbent on us to work closely with our nearest neighbours in that regard.

I am sure this is kept under constant review. However, in addition to the regulations before us today, will my noble friend repeat the assurance that we will keep these regulations—and others flowing from the 2018 and 2019 measures—under constant review? I have one particular concern: to try to close down the channels of communication used by what appear to be sole perpetrators, such as in the recent attacks in France. Can my noble friend and his department address the possibility of cutting down these channels of communication, to make it less likely that these sole perpetrators will be in a position to act?

My Lords, it is a pleasure and an honour to make my short maiden speech today. Having spent 30 years in the House of Commons, I am well aware of the differences between the two Houses. I shall try very hard not to bring any of the worst practices from that House into your Lordships’ House. Many things have changed here in the past few months but one thing that has certainly not changed is the great welcome given to all new Peers. I thank all of your Lordships for your friendship, kindness and help over the past few weeks. The staff have been absolutely wonderful. I particularly thank the staff who are working here: the cleaners, the catering staff, the attendants and the doorkeepers. I am sure I have left some out but all the people who are actually here make such a difference to our lives, and I thank them.

I obviously want to thank the supporters of my introduction, the noble Baroness, Lady Mallalieu, who I worked with closely in her capacity as president of the Countryside Alliance, and the noble Lord, Lord Elton, who I worked closely with on Zimbabwean issues. Of course, today he announced his retirement after 47 years in your Lordships’ House. I was very honoured that his last appearance was to introduce me to your Lordships’ House. I am sure we all wish him and Lady Elton the very happiest of retirements after 47 years.

I am very proud of my Northern Ireland upbringing on a small farm in County Antrim, which is why I have Lylehill and Rathlin as territorial designations. Lylehill Primary School, a two-teacher country school, was where I had a wonderful start to my education, and the Presbyterian church, the oldest one in Northern Ireland, was where my parents were married and I sung in the choir and first worshipped. Rathlin Island, the only inhabited island off the coast of Northern Ireland, with 120 full-time residents, thousands of seabirds and a lot of peace and tranquillity, is probably best known to your Lordships as the place where one islander, my late and great friend Tommy Cecil, rescued Richard Branson when his balloon came down after crossing the Atlantic.

My Lords, it is a great pleasure to follow the maiden speech of my distinguished friend of almost 40 years. Kate and I go back to the early 1980s; I knew her as a parliamentary candidate in Dulwich, I knew her as the MP for Vauxhall, elected on European election day in 1989, and I have known her as a friend all the way through, despite the fact that for at least half that time, I have been a member of the Conservative Party. Before that, I was in the same party that she used to belong to. So, we both moved, you might say.

I recall that when Kate was a candidate, the slogan we had was that she would “hit the ground running,” because sport has always been an important part of her life. Indeed, she was the first woman to be Minister for Sport in this country, and she has always championed sport. She had a career with Tottenham Hotspur youth and helping young people to appreciate sport, and for eight years she was adviser to the Mayor of London—a long and distinguished career.

She has also been unafraid to embrace controversial issues. I remember agreeing with her that the foxes around the dustbins of Vauxhall were of more concern than those being chased around the fields of Kent. I still happen to feel that way, and I was pleased to go on the Countryside Alliance marches years ago. She has a long record of being prepared to stand up for what she believes in; Vauxhall was very lucky to be represented by her.

Europe is the one area where Kate and I have never agreed, but we have come nearer to agreement now. In the run-up to the last election, I consistently queried the referendum result and said that I thought the circumstances of the referendum were dubious. I asked for another referendum, or an election to sort out the matter. We had an election, and it is quite clear that I lost. In a democracy, on occasion, you have to accept that you lose. I am not going to oppose the Government. I welcome the Government’s work and the Minister’s; he has had to do a lot of detailed work transposing all these European regulations into UK law, and I wish him well with that.

It is a pleasure to follow the noble Lord, Lord Balfe, in this important debate. I would also like to take the opportunity to welcome the noble Baroness, Lady Hoey, to your Lordships’ House. Both of us are from Northern Ireland. We have divergent views on Northern Ireland and on Europe. Notwithstanding that, I welcome her, as I knew her in the other place.

I would also like to thank the Minister for his explanation of these regulations, which will be robust sanctions to prevent money laundering and terrorism. Coming from Northern Ireland, I am only too well aware of the role of money laundering in terrorism, how pernicious it has been and how invasive that level of terrorism has been. Today, we saw evidence of probable international terrorism at work in the brutal murder of three people in the south of France, in Nice—a lady at prayer practically beheaded. Such terrorist acts require immediate action from government.

I have some questions I would like to ask the Minister. The noble Baroness, Lady McIntosh of Pickering, and the noble Lord, Lord Bradshaw, asked if these measures would be effective when dealing with our colleagues in the European Union. Would they still afford the same levels of co-operation and work, and would they be as effective as the original regulations under the EU regime?

What will be the relationship with the EU countries in working to address the money laundering and terrorism activities that impact on liberal democracies such as France and Britain? What level of co-operation will continue to exist? The Minister said that there would be ongoing work with the G20, the G7 and the EU. Notwithstanding the need to preserve confidentiality, can he define that work and the extent to which police forces throughout the UK, the EU and the wider world will liaise to gather intelligence in order to combat money laundering and terrorist actions?

My Lords, it is a pleasure to follow the noble Baroness, Lady Ritchie of Downpatrick; I look forward to hearing the Minister answer her questions. I also welcome the noble Baroness, Lady Hoey. Her speech was very good, especially when she mentioned not bringing bad habits from the other place—we do occasionally see those, and it is great that she is not going to do that.

I have three queries for the Minister. Will he set out how the Government will apply sanctions to illegitimate regimes where the ruler refuses to leave office after being defeated in a democratic election? Secondly, I am sure that the Government have paid attention to Donald Trump’s consistent refusal to commit to a peaceful transfer of power if he loses next week’s election. Have the Government made plans for what they will do, diplomatically and economically, if Donald Trump loses and refuses to leave office? Thirdly, in that situation, will the Government stand up for democracy and the rule of law by applying sanctions to Donald Trump, the Trump family and the Trump Organization? They could, of course, freeze the Trump assets in the UK, such as the Turnberry golf course, until the President peacefully transfers power.