My Lords, before I start, I acknowledge the point just made by the noble Lord, Lord Purvis, about the wide-ranging nature of modern FTAs. We will no doubt return to that point in our future debate.
On Amendments 7, 9, 10 and 103, I shall turn first to Amendment 9, which stipulates that Clause 2 would apply only to agreements that the EU has ratified with third countries, as opposed to simply having signed them. Unfortunately, this amendment would mean that important agreements with key strategic partners would be excluded from the scope of the clause and so, once signed, would be left without an implementing power. My noble friend Lord Lansley has picked up this point in relation to Canada. This would include an agreement with Canada, because CETA has not been fully ratified by each member state of the EU, despite being in effect for some time now. We have heard from businesses large and small that providing continuity in this particular trading relationship is essential; unfortunately, this amendment would threaten these vital trade flows and commercial relationships.
I also draw your Lordships’ attention to the fact that a number of international development-focused agreements between the EU and third countries have not been fully ratified, despite being in force for some time. One example is the economic partnership agreement with the CARIFORUM states. Developing countries are sometimes unable to ratify agreements in full before entry into effect. Sometimes this is for procedural reasons; sometimes it is due to issues of domestic governance. Whatever the reason, this amendment would deny the UK’s trade for development assistance to these countries, simply because the predecessor trade agreement was not fully ratified.
I reassure my noble friend Lady McIntosh that the agreements that this amendment seeks to exclude have been subject to comprehensive EU scrutiny processes at mandate, negotiation and concluding stages. We were
fully involved in those processes. As noble Lords are no doubt aware, the delay to ratification relates to individual country or state processes, as opposed to those carried out at the level of the European Union.
On Amendment 10, just as the previous amendment sought to exclude a number of key trading partners from the scope of the Bill, this amendment seeks to bring a number of new FTA partners into scope, including the USA, Australia and New Zealand. As I explained to the House at Second Reading, this Bill is a vehicle for the implementation of continuity agreements only. I am grateful to my noble friend Lady Noakes for picking up this point. Scrutiny and implementation of new free trade agreements is an important conversation but one that must be had separately from the Bill. No doubt we will be having that conversation at various points in the future.
However, I recognise that many colleagues would like some indication of and clarity about how this process will work. As noble Lords are aware, when negotiating new free trade agreements we have gone above and beyond the baseline CRaG process, providing extensive information to Parliament, including publishing our objectives and economic scoping assessments prior to the start of talks. We also hold regular open briefings for MPs and Peers throughout the negotiations. We will continue to keep Parliament updated on negotiations as they progress, including close engagement with the International Trade Committee in the House of Commons and the international agreements committee in the House of Lords. I give full recognition to the valuable work of these committees.
At the end of negotiations, we will produce an impact assessment of the final treaty prior to it being laid before Parliament for scrutiny under CRaG, alongside an Explanatory Memorandum. In addition, we will seek to allow time between finalising a new FTA and laying it before Parliament under the CRaG procedure, so that the relevant scrutiny committees in Parliament may produce an independent report on the agreement.
I am sure we will return later in Committee to the whole question of scrutiny and the important role of Parliament. I hope that the noble Lords, Lord Purvis, Lord Blunkett and Lord Haskel, and my noble friend Lord Lansley will not feel short-changed if I keep some of my power dry until that later debate.
My noble friend Lord Lansley asked about legislation for implementing future free trade agreements. As we have said on a number of occasions before, the Government will bring forward specific implementing legislation—the primary legislation necessary—for new free trade agreements, providing Parliament with plenty of opportunities to scrutinise and vote on these agreements. I hope that reassures the noble Lord, Lord Purvis. I look forward, no doubt, to our debating the matters that we have debated on this Bill on future Bills which would implement future free trade agreements.
In a nutshell, I do not believe that the established and well-functioning process for scrutinising continuity agreements needs to be changed at this point. This House has held three debates covering six continuity agreements, following reports published by the European Union Committee. As your Lordships will be aware,
none of these debates has resulted in a Motion to Regret. This process has been fair, open and, most importantly, proportionate to the nature of the continuity agreements.
On Amendment 7, like other noble Lords I enjoyed the noble Lord, Lord Stevenson, parsing the meaning of “appropriate” and “necessary”, and my noble friend Lady McIntosh has given us the benefit of her Scottish expertise on this matter. I can speak quite plainly and say that all regulations made under the Clause 2 power to implement international trade agreements will be necessary. The Clause 2 power is needed to implement legislative obligations arising from trade continuity agreements into our domestic statute. Our expectation is that this power will be mainly used for obligations relating to procurement or recognition of product conformity assessments. To clarify, tariff-related provisions will be implemented using powers in the Taxation (Cross-border Trade) Act.
Without the ability to make such changes, we would be at risk of breaching our international obligations. It is the Government’s responsibility to ensure that this does not happen. However, this proposed amendment could prevent that by constraining the vires or scope of the regulations that can be made under Clause 2, in particular when using the concurrent powers to legislate in areas of devolved competence. We will be debating that topic later in Committee.
I can assure the House that, despite the suspicions that some noble Lords have, the powers in this Bill will only be used in a proportionate way and that consultation with all stakeholders is a fundamental part of our approach and will remain so going forward.
On Amendment 103, I thank the noble Lord, Lord Stevenson, for his amendment. However, I fear I may be beginning to sound like a broken record, as I am going to say yet again that this is a continuity Bill. The Government have no desire to seek sweeping powers to be able to use this Bill to implement all our future free trade agreements, with the likes of the US, Australia and New Zealand. I dare say that, if we had tried to do that, our knuckles would have been very sharply rapped by this House.
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The amendment sets out a form of the rarely used super-affirmative procedure to bring future FTAs into effect. As a new boy, I had to look up how that procedure would operate. What I learnt was, as I am sure all other noble Lords will already appreciate, in the context of continuity agreements, this would take 81 sitting days for each regulation, occupying a disproportionate amount of your Lordships’ time to implement what are frequently simply technical changes to legislation.
For example, for our newly negotiated enhanced continuity deal with Japan, we will require an SI to remove a non-tariff barrier to allow for more trade in spirits between the two countries. Again, this is a provision that is of a technical nature. Technical changes of this nature are generally made via negative procedure, thereby freeing your Lordships’ time to consider legislation that can be further improved by your knowledge and expertise.
To pick up a couple of points that the noble Lord, Lord Stevenson, made, the Bill can only be used to modify primary legislation that is directly retained EU law. I hope that point reassures him. On his other point, where we say,
“over time and in all circumstances”,
that generally refers to future needs to keep agreements operable in light of things like machinery of government changes. Failure to make these changes would technically put us in breach of our international obligations.
Returning briefly to scrutiny, the CRaG procedure does provides the statutory mechanism to prevent ratification of any treaty, including FTAs. Additionally, treaties cannot themselves change domestic law, and legislation to implement agreements would be scrutinised by Parliament in the usual way. With these assurances, I would ask noble Lords not to press Amendments 7, 9, 10 and 103.