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Lord Hodgson of Astley Abbotts: My Lords, the whole House will be grateful to the Minister for the amendments he has tabled. As he says, there is a delicate balance to be struck between shareholder democracy and shareholder tyranny. On these Benches we welcome these changes, which are clearly an important and worthwhile step in the right direction. Events involving GlaxoSmithKline have given them urgency. We have not yet had much time to study them or to think through their implications. That will probably be for debate in the other place, during Committee stage. We wonder whether further tightening up will be needed as consultation takes place.
Three thoughts have occurred to us, which I offer to the Minister this afternoon. First, we have not heard the end of the issue of proper purpose and the definition thereof. If a company—particularly in the early months and years of the legislation without any court guidance on what the court thinks is proper or improper—has to go to the trouble and expense of going to court, there must be a risk that, because of the
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time, money and the risk to reputation of going to court and being turned down, it will be inclined to hand over the register rather than go through that hurdle. The "not a proper purpose" issue will have to be further probed as consultation takes place.
The second question is whether the amendments prevent the chain request; that is where I persuade someone who is perfectly legitimate to use a legitimate purpose to get the register for someone else. Therefore, will there be a proper trace back to the person who is improper, even if the sequences in the chain are perfectly proper? The last thought is whether there is an alternative route that might provide a more effective way of preventing this situation in the Data Protection Act or equivalent legislation, which would achieve the purpose that we entirely share in a way that shuts off the issue more completely than it is possible to do in what is, after all, a company law reform Bill.
Those are our thoughts, on which I hope the Minister may be able to give some preliminary comments. For the time being, from these Benches, we welcome the Government's prompt attention to this important matter and entirely support the amendments.
Lord Clinton-Davis: My Lords, as far as one can see, the Government have dealt with the mischief that we had the misfortune to witness the other day, but only experience will tell. I hope that what the Minister said will satisfactorily deal with the situation, but if the Act is not performing well, would he be prepared to look at it again with an open mind? I am not saying that it will happen, but it might.
Lord Razzall: My Lords, I share the thanks of the Conservative Benches to the Government for having brought forward the amendments. I have a couple of points to make. First, there should be no doubt about the seriousness of the issue that the amendments are attempting to address. Anyone who heard the chief executive of GlaxoSmithKline on the radio the other day will have taken heed of his warning that there is a danger that significant chemical and scientific research will be exported outside the United Kingdom if the actions of extremists continue. He even suggested that those decisions were already being taken by multinational companies, so it is in the interests of UK plc that the Government get this right.
It was slightly unfortunate that the chief executive went on to say that he did not think that any change in the law was necessary. Although he was making the technical point that the Minister also made that existing statutes could be used to prosecute such people, he gave the impression that this was not a serious issue requiring a change of the law, which does not reflect the Government's position. I share the Government's concern.
Secondly, we had 13 days in the Moses Room in Committee on this Bill, which are forever etched in our memories, and we had three days on Report. However, because of the events triggered by GlaxoSmithKline, the Government are being forced at this very late stage of the Bill to bring forward these amendments for the
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first time. What would have happened had this process started at the beginning of the Bill? This is no criticism of anyone; this is just what has been provoked by recent events. Had this come at the beginning of the Bill, the Conservative and Liberal Democrat opposition and the Government would have had the benefit of extensive consultation and input from all those people who have given us input on all sides, which has enabled this Bill to be significantly improved as it has passed through its various stages.
I just hope that when the Bill goes to another place, the Government will take heed of the fact that that consultation exercise will probably need to take place without the benefit of the two experts sitting on the Government Front Bench here. The other place does not have a serious record of imposing detailed scrutiny on these sorts of points in technical Bills of this kind, so I urge the Minister to impress on his colleagues in another place that, when the Bill goes into Committee, they should concentrate on the clauses that have not received the detailed scrutiny given to some other clauses in the Bill.
Viscount Bledisloe: My Lords, I want to make a couple of observations related to those made by the noble Lord, Lord Hodgson. Unlike the noble Lord, I do not think that it is viable to try to define "a proper purpose". You can be absolutely guaranteed that the one thing you leave out of the definition will be the one thing that happens.
On the other hand, I am a little unhappy that the test for the court is still the motive of the person making the request—what he seeks it for—rather than the way that the information is likely to be used. Perhaps I may illustrate what I mean. A very worthy, but perhaps somewhat naive, person genuinely wants to write to those who have shares in animal research companies and wants to get the names to do so. However, the person is associated with, or is a member of, one of the extremist organisations. From experience in relation to other companies, it is well known that if this worthy person gets the list, he will pass it on to the activists, who will then use it for an improper purpose.
Although the motive of the person seeking the information is perfectly proper, surely the fact that the court is convinced that the information will be used thereafter for an improper purpose should require it to refuse the application. I accept that the people misusing the information may be committing offences and so on, but that has never daunted them in the past and it will not daunt them in the future. Surely the purpose of the provision is to ensure that the names and addresses do not get into their hands. I suggest that the other place considers adding words such as "is not sought or is unlikely to be used for an improper purpose". I am not trying to draft on my feet but I hope that the Minister sees what I am getting at.
Lord Sainsbury of Turville: My Lords, obviously we will keep an open mind on this issue, should it not work in the future. However, the problem is that you can have an open mind and make decisions but then
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there is always a time-lag in getting changes made in the legislation. Therefore, we want to make every effort to get it right on this occasion.
I think that we dealt with the problem of what the noble Lord, Lord Hodgson, described as the chain-letter situation, to which the noble Viscount, Lord Bledisloe, also referred. That is covered by Amendment No. 10, which states:
"It is an offence for a person in possession of information obtained by exercise of either of the rights conferred by that section . . . to do anything that results in the information being disclosed to another person, or . . . to fail to do anything with the result that the information is disclosed to another person, knowing or having reason to suspect that person may use the information for a purpose that is not a proper purpose".
So we are trying to put a block on the chain-letter situation, which would be a way round the problem.
This clause was already in the Bill. Therefore, the Government had thought about this point and wanted to act on it. I am delighted that the Opposition and other noble Lords pointed out that it could be strengthened, and we think that it now is. Finally, Ministers on these Benches and in the other place work together as a team, whatever may happen to other parties.
4.15 pm
Lord Jenkin of Roding: My Lords, I apologise profusely for not being here at the start of the debate. I want to express my thanks to those who have been briefing me on the question, and to say that the Government have made a fair attempt at trying to deal with this problem. I have studied Amendment No. 8, which seems to me to meet the case. The court will no doubt be able to decide what is or is not "a proper purpose". It has probably already been said, and I apologise, but this needs to be examined carefully, and I hope that the Minister will not rule out the possibility of amendments being moved in another place.
On Question, amendment agreed to.
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