My Lords, I am very grateful to my noble friend the Minister for her careful consideration of the points that we made when we tabled the original amendment. We did so because we recognised that, based on the Government’s own figures, the level of online ticket fraud was of the order of £1.5 billion in 2012. That was of course a momentous year but that figure of £1.5 billion does not include the Olympic or Paralympic Games because, as your Lordships will recall, the opportunity was taken both in this House and in another place to criminalise the secondary market for that specific event. It is important to recognise that that figure of £1.5 billion was one where online ticket fraud occurred when victims purchased tickets for an event—such as music, sport, theatre or a performance—which did not materialise.
In the many hours of negotiation and debate, we have sought to address the causes of our concerns: that there is a very significant volume of counterfeit and invalid tickets sold to the public through the secondary sites. As 85% to 90% of resale now takes place through the four platforms, which are owned by three companies, the overwhelming majority of these invalid tickets come through those sites. The biggest problem in this day and age is not the old-fashioned tout. It is the wholesale harvesting of tickets by touts from their computers, with specialised software. They are incentivised by these four platforms, not least through power seller programmes. This harvesting is now out of control and volumes of tickets are acquired on such a scale that it is proving difficult, if not impossible, for genuine music and sports fans to purchase a ticket at face value for high-demand events. In the time when you are typing in your name, address and details, the specialised software is sweeping the volume of tickets available to the general public and within a matter of minutes, sometimes, those tickets are appearing on the secondary websites. The sheer number of tickets for high-demand events going on to the platforms is sufficient to facilitate price manipulation, to the detriment of the public.
Against that background, I would like to address a number of points that my noble friend the Minister has made. I say straight away that it is really important that anyone considering the position we are taking on this Motion recognises that there has been universal support throughout the proceedings in your Lordships’ House for a secondary market to thrive. But that secondary market needs to be effective; it needs to be transparent and accountable. That is the really important point. To use the words of my noble friend the Minister, we are seeking light-touch regulation to ensure that we can absolutely guarantee to individuals who want to go online the right level of information, from which they can then make a decision to purchase.
In the past, we have not had the legal support for consumers to have that information available. As the Minister rightly points out, the four key elements are information, face value, seat number and row number. It is absolutely right and proper that someone who is disabled or in a wheelchair knows that they can have access to that seat before they make that purchase. At the moment, that is not the case. Following this legislation, if your Lordships agree to the Motion in my name, all those details and information will be available before a decision is made and before the purchase takes
place—not after the purchase has taken place. That is in subsection (8)(b) of the proposed new clause. It is an exceptionally important point for the secondary ticket operators to recognise when they implement this legislation, as I hope they do.
The second point is that for too long the terms and conditions set by the original event organisers have not taken full legal precedence. If you are the event organiser and you are putting on Glastonbury, for example, and request pre-registration to ensure that the person who is buying the ticket is pre-registered and, in the case of Glastonbury, that there is a photo—that is what the organisers want—it must be right that those terms and conditions take precedence. They do so because Glastonbury does not want touting. They do so because in many cases there are law and order issues. It should be right for theatres to decide whether they want children under the age of four, for example, to come to a performance when they might possibly disturb other people’s enjoyment of the evening. Those terms and conditions, however, must meet the fairness test and they must be legal. That is on the face of the Motion. That is vital, so that there is no avoidance of doubt: the action taken by event organisers in setting terms and conditions must meet the fairness test and must be legal.
The two Motions that were originally tabled by the Minister covered a duty to report criminal activity and the review. I am most grateful to her for her consideration of the many aspects of these tickets and the information that we wish to see provided on them. The matter has been considered in full by her team and, indeed, by her. I give one case in point. The movers of the original amendment were very keen to see a booking reference on the ticket. This would enable an individual to check with the event organisers whether that ticket was valid. Apparently, neither a booking reference number nor a ticket ID number falls within the “main characteristics” of a ticket and, therefore, under EU law, we cannot require that information to be provided. There are different legal opinions on that. There are many lawyers who believe that an essential characteristic —indeed, a main characteristic—of a ticket is its original ID number. We recognise, however, that government advice was that this is not the case. This is a compromise amendment and the result of many hours of negotiation. I hope that, when we come to the review, that issue will be looked at in more detail.
It is also important that, while we are putting the responsibility on the secondary market through this Motion to take a whole series of steps, at the same time we recognise that the event organisers need to reflect during the review on how they can improve the opportunities for resale. Resale is a difficult and sensitive subject, but to have good relationships with your consumers and your fans, looking at resale under certain circumstances is a very important priority for the event organisers. Wimbledon’s policy on non-transferable tickets is that, provided that the ticket is returned before the start of play, the buyer gets a full refund. The ECB allows face-value resale to family and friends; it will not cancel face-value on the secondary market. The Oval and Lord’s offer full refunds and ticket exchanges. The 2015 Rugby World Cup will have a full ticket exchange. So event organisers are very
much aware of the importance of keeping good relationships with their fans and recognising that sometimes it is not possible to go to an event, maybe due to a family crisis, and that where possible resale policies should be put in place. I very much hope that, during the process of the very important review that the Minister has announced today, the question of resale will also be considered in detail.
It is right that when the Secretary of State at the DCMS, who has policy responsibility for this subject, appoints the chair of the review, he considers in detail the points raised in both Houses before proposing the final terms of reference. It has become clear from your Lordships’ interventions on all sides of the House, and from the excellent work of the all-party group on this subject led by Sharon Hodgson and Mike Weatherley, that a thorough investigation of the operation of the secondary market is essential. We need to understand why that £1.5 billion of fraud has taken place and to address it; we need to look carefully at the business models employed.
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I also hope that the review will research the impact of touting on fans and events and the effect of excessive profiteering on the objectives set for event organisers. This is not just about sport and the arts; it is about the church, charities and events that reach out to the public, where anyone organising that event wants to ensure that the information is available to them. We need to research the impact on those individuals and what they may get if they have a counterfeit ticket. At the moment, if you have a counterfeit ticket, after much deliberation you may get back from the secondary site what you paid for it—but you have missed the experience. You may have travelled down from Glasgow with your family. Ultimately, many of the people who are reimbursed are reimbursed by their credit card companies, not by the secondary market. These are issues that need to be looked at carefully in the review.
Above all, we need to look at how technology is developing—how the website is being used to maximise the opportunity for touts to sweep tickets and then sell them at a high profit. We need to look at the effectiveness or otherwise of existing legislation and the ability of enforcement to tackle international platforms, working offshore in this sector. In this context, it is international co-operation by law enforcement officers and legislators that is important, as in the gambling market, and the co-operation undertaken in this context during the London Olympic and Paralympic Games would be a useful case study.
I hope that the review will look at the need for better enforcement of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, particularly in defining what constitutes a trader. We need to look at what non-legislative measures can be taken by event organisers to prevent the unauthorised resale of tickets. I hope that we will look at model terms and conditions for ticket sales, and then ticket sale arrangements by primary event organisers and the relationship between event organisers, the contractual relationships with primary organisers and ways of putting the interests of the consumers—in this case,
the true fans—first. I have mentioned that I very much hope that the review will explore with the European Commission what precisely constitutes a main characteristic of a ticket; it is only recently that the directive has been published and implemented, and we need clarity on the issue. The review will give us the opportunity to look into it in detail. Above all, there are two case studies within the timeframe of the proposed review: we will have the chance of reviewing the Ashes test and the Rugby World Cup.
For those who are writing, or about to write, manifestos, it would be worth while reflecting on a Populus opinion poll on this subject. There has been a lively campaign of emails to many of your Lordships on the unpopularity of these measures. I can bring the House up to date: in that Populus poll, the question was put whether there should be more government regulation of ticket sales, and 68% of the public agreed while 8% disagreed. Then of course there were the categories of “somewhat disagree”, “strongly disagree” and so on. On the question of whether ticket sellers should be made to disclose the ticket row and seat number—basic information that any consumer should have before making a decision to purchase—76% of the public supported the intent of the Motion that we are laying before the House today, and a mere 3% disagreed. If noble Lords want a populist measure that is also the right one for consumers in their manifestos, whichever party they represent, I cannot imagine a stronger level of public support than they would find for the measures that we have worked so hard for. My noble friend Lady Heyhoe Flint has been second to no one in the amount of work that she has put in to secure the consensual agreement that we have reached with the Government today.
It will not have escaped noble Lords’ attention that the Secretary of State in the Department of Culture Media and Sport has clear views on this subject, which I very much respect. I want to thank him and his team for their engagement in the lengthy negotiations and their courtesy in staying heavily involved. When I was Member of Parliament for Lewisham East, as one of the only two Conservatives in the history of that seat—the other being Christopher Chataway, whose passion for sport knew no bounds—Sajid Javid was an impressive officer of that association, before he embarked on his successful career both inside and outside Parliament. I consider him a friend and I think very highly of him. I thank him again and wish him well with implementing in full the statutory review.
I have no doubt that the measures taken today will in due course strengthen the secondary market, address the excessive profiteering which has been the product of an unregulated, web-driven market, and consequently enable the Secretary of State to strengthen further his support for this industry. In the mean time, my thanks go out to the BIS team. As I have said, there are strong views on both sides of this debate and it is not without humility that, having recently seen the wonderful film “Testament of Youth”, I am reminded of the passage in Vera Brittain’s book Testament of Friendship, in which an epitaph on a gravestone erected by a certain Major Milner to his wife Dorothy in 1826 reads:
“What faults you’ve seen in me, strive to avoid. Search your own hearts, and you’ll be well employed”.
On this occasion, the faults that they have seen in me have dominated proceedings. They have been patient, professional, calm and understanding during two months of almost daily negotiation, either on the phone or in person, including every single day of last week’s recess. I offer my special thanks to them and to the Public Bill Office, and to Ashley Lumsden, the special adviser from BIS, who has commanded the highest respect from everyone who has been involved in these negotiations for his indefatigable work.
This Motion is only the beginning. I look to the Government, the secondary market and primary event organisers to make sure that it works. In so doing, I congratulate my noble friend the Minister on securing what I hope will be the safe passage of this excellent Bill. I beg to move.