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Seanad Éireann debate -
Thursday, 1 Mar 2007

Vol. 186 No. 9

Control of Exports Bill 2007: Committee Stage.

I welcome the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, to the House on Committee Stage of the Control of Exports Bill 2007.

Sections 1 and 2 agreed to.
SECTION 3.

I move amendment No. 1:

In page 5, subsection (2)(b)(i), line 8, to delete “citizen” and substitute “resident”.

I welcome the Minister of State to the House. A short time has passed since Second Stage. My amendment is clear and I tabled it on Second Stage because of an anomaly, if not an absurdity, in section 3. Section 3(2) deals with the scope of the brokerage activities addressed in the Bill and applies to such activities that take place in the State. There is nothing contentious in that respect, but section 3(2)(b) extends the provision to activities carried out by an Irish citizen or Irish registered company outside the State. A difficulty arises in this respect in that, while I have no difficulty regarding the provision for companies, I question the provision for citizens. Many citizens leave the country and are never seen here again, but they continue to hold Irish passports.

My bemusement arises from how the State could control brokerage activities carried out by a person who has not set foot in this country for 20 or 30 years. How could the provision be enforced? If it cannot be implemented, legislating for it is bad practice. It reduces legislation to an aspirational level instead of making our law something that is enforced and respected. I focus on the simple practicality of whether it would be possible to enforce this provision, rather than on the wider issue of whether it is right to try to enforce the law on citizens who no longer have any connection with the country. The standard approach is that the jurisdiction of the State stops at its borders. There are good reasons this should be so. However, an argument needs to be made for extending the jurisdiction outside the State, but I am not sure how this can happen and it is a subject for another day.

For the moment I rest my case on the sheer impracticality of enforcing the provision on Irish citizens who have left the country, and no longer have any links with it, whatsoever. On the other hand, paradoxically, this section, as it is written, makes no attempt to control what is within our power to do. It makes no effort to capture brokerage activities carried on outside the State by someone who lives in Ireland but is not a citizen. We have a possible purchase on activities such as this because of a person's residency. Under the Bill as it stands the provisions only apply to activities as they are carried on outside the State, so that a person will actually escape if he or she does that. If someone is a resident here, or purposefully comes here, perhaps, and operates a brokerage outside the State, we can do nothing about it under this legislation. It is a loophole that should definitely be closed.

This section, on the one hand, purports to control activities by citizens who may not have had any connection with Ireland for years, but totally ignores activities carried out by residents who are here, simply because they are not citizens. If they are not citizens and live here we cannot do anything about it. I suggest both these anomalies could be resolved simply by substituting the word "resident" for "citizen" in subsection (2)(b) (i).

I will set out what section 3 does. It enables the Minister to make orders or regulations to control brokering activities in accordance with the EU Common Position 2003/468/CFSP of 23 June 2003. This provides for controls to be imposed on brokering activities undertaken in the State — and outside the State, if undertaken by an Irish citizen or company.

The issue of extraterritoriality was a key consideration when framing this section. A person normally resident here could, for example, arrange for an arms transfer while temporarily outside the State in relation to goods that at no point transit through Ireland. In the absence of appropriate legislation, on his or her return to Ireland no prosecution could follow, notwithstanding that an arms embargo had been breached or that Irish export control laws could have been evaded. There are, of course, certain challenges as regards the enforcement of extraterritorial controls. However, on balance I consider it preferable to have such controls in place so that if documentary evidence concerning illicit arms brokering becomes available, for example, as a result of the sharing of intelligence between law enforcement agencies, then the State has the capacity to mount a successful prosecution.

On consideration of Senator Quinn's questions on Second Stage, as well as the amendment, as currently drafted the section enables Ireland to comply with the EU Common Position. However, as I promised last week during the Second Stage debate, the Department has looked into the possibility of expanding the scope of the extraterritorial controls to include persons normally resident in Ireland as well as citizens. Preliminary inquires indicate this matter will require some investigation and I am seeking the advice of the Office of the Attorney General as to the feasibility of the proposal. The main issue is that while there are good precedents in international law for exercising extraterritorial controls on a country's citizens and companies, the situation as regards non-national residency is less clear.

A further complication is that there is no single legal definition of "resident". For example, a person who has resided in the jurisdiction for 183 days or more in one year, or 280 days in two years, is regarded as being resident for taxation purposes. If one is resident for three consecutive tax years one acquires the status, "ordinarily resident". This is not the same as the concept, "domiciled", which is usually interpreted as an intention to reside permanently in the country.

As it has not been possible to resolve the issues raised in the time available, the Government is not in a position at this time to accept this amendment. However, if I am advised that the extension of brokering controls along the lines proposed by Senator Quinn is legally feasible, then it is my intention to table an amendment to this effect when the Bill comes before the Dáil on Committee Stage.

I thank the Minister of State for the clear intention and for the attention he has given to the proposal. I do not want to see legislation passed that is not enforceable. I now understand the difficulty as regards the terms "domiciled" and "resident", etc. It is perhaps too facile a solution to just change the words. However, there were just two objectives in what I was trying to achieve. One was the fact I do not like to see legislation passed that is not enforceable. If we introduce legislation purely for the purpose of keeping in line with a EU directive, we should ensure that it is also enforceable. It might well be that the legislation will be in line with the European directive, but that is not my concern.

I understand, yes.

If we are going to pass legislation here, it should be possible to enforce it. I do not know how we can enforce it, in the first place, on a citizen who has not been here for years but still holds an Irish passport. I understand that point, but I leave it to the Minister of State to find the solution.

The other matter that concerns me more is the fact that brokerage activities could be carried on outside the State by someone actually living here. I am not sure about the legal definitions of "domiciled" and "resident" and the Minister of State has clearly explained the position. I understand the solution is not as simple as what I proposed, perhaps, but I appreciate that he is going to give the matter his attention.

I am always fearful that matters that take place in the other House give the Dáil credit rather than the Seanad. I should like to emphasise that this is not just a selfish initiative on the part of a Member of this House. However, I accept the point the Minister of State makes. I am pleased he is going to look into it and I hope we find a solution. I hate to find legislation that is not enforceable or that leaves a loophole. In this case the substitution of "resident" for "citizen" was an effort to achieve that. I appreciate the Minister of State's response and I know he will give the matter his attention.

I thank Senator Quinn for the valid point he has made.

Amendment, by leave, withdrawn.
Section 3 agreed to.
Sections 4 to 8, inclusive, agreed to.
SECTION 9.

I move:

2. In page 10, line 34, to delete "Act" and substitute the following:

"Act, and providing details of—

(a) the quantities of goods licensed for export,

(b) the values of goods licensed for export,

(c) details of end-users of goods licensed for export, and

(d) details of companies exporting dual use goods under open licences”.

The section lays out that a report must be prepared by the Minister after the end of each year on the operation of matters within the scope of the Act. I believe there should be specifics in the report. The Minister of State will tell the House what specifics, if any, will be in the report. This is the worry.

At the outset I want to say I am grateful to Amnesty International for its advice on this matter. If there must be reports, we should be concerned about the parliamentary structures to be put in place for scrutinising them. It is reasonable that export licence data should be included in these annual reports providing details of the quantities of goods licensed for exports as well as details of companies exporting dual use goods under open licences. I look forward to hearing the Minister of State on this matter.

I completely oppose this amendment. The Senator is getting into too much red tape on this issue, and in so far as the disclosure of competitive edges is concerned. This type of disclosure may be used by other countries to know exactly what we are exporting and when. As a former Minister of State with responsibility for trade, I would not be in favour of such disclosure. It is impractical. I am not interested in whether it is Amnesty International or the British trade board that is interested in having this provision included in the legislation. It would be folly to include it and, therefore, I disagree with the proposal to insert it.

I would make a point that is covered in the Bill, namely, we are the good citizens of Europe all the time.

Hear, hear.

As far as Britain is concerned, it produces land mines and cluster bombs——

It is engaged in the war in Iraq.

——and it exported torture chambers some years ago. I do not know of any other country that would introduce this type of legislation. To tie ourselves down further by the insertion of this amendment would be detrimental to the best interests of our exporters. Accordingly, I urge the Minister of State to reject it.

The objective of Amnesty International and Senator Coghlan in regard to this amendment is worthy. However, Senator Leyden has made a case challenging it. If such detailed information would be required for all exports, information which would be valuable to a competitor, it would generate a great deal of red tape. One of our objectives, and I know this is close to the Minister's heart, is the putting in place of better regulation that reduces red tape. If we put a regulation in place that is difficult to enforce, generates a great deal of red tape necessitating the collection of information, and does not apply in other countries, that would clearly be a disadvantage. The objective Senator Coghlan seeks is worthy. Perhaps the Minister of State might examine if there is a way of achieving it rather than necessarily having to provide the precise details listed in the amendment.

Section 9 introduces a provision for an annual report of the operation of the Act to be prepared and laid before the Houses of the Oireachtas. This is in line with a key recommendation of the first FÁS review and a response that calls for greater transparency in the area of export controls. I welcome the opportunity which will be provided by the publication of the annual report to provide accurate information on the export of military and dual-use goods from Ireland and to counter some of the misapprehension which result from sensationalist media coverage of this issue.

With regard to the amendment, the non-governmental organisation sector frequently seeks information on actual exports by named companies. I would like to be clear about this; I do not consider it appropriate to provide such data. Information submitted by companies in connection with export licence applications is provided in confidence. It is almost always commercially sensitive and there may be security and international relations issues around it. I am also concerned that the disclosure of such detailed information could prejudice or impair enforcement of and compliance with applicable Irish and European legislation. I am committed, however, to providing information on an aggregate value of actual exports of goods under licence sorted by category and the country of destination, as I am firmly of the opinion that this will present a much more accurate picture than reliance on licensed values which, by their nature, tend to be considerable over-estimations.

On a more general point, I consider this amendment, which could be interpreted as restricting the information to be provided on the data listed, to be unnecessarily prescriptive and, if accepted, would impinge upon the legitimate policy-making function of the Minister of the day with regard to the scope and content of the annual report. Therefore, I cannot accept the amendment.

I appreciate what the Minister of State said. I assure him that it certainly was not my intention to propose a measure that would be restrictive. I take on board and appreciate what he said about providing information on an aggregate value of exports.

Contrary to what Senator Leyden might have implied, we are not a secret society type of organisation. I tabled this amendment on the basis that we are a good, proper and open democracy.

Hear, hear.

We have upheld proper standards. As a country, I will not say we are the model in Europe——

We actually are.

——but our standards are good. As the Minister of State said, we must have a goal of ensuring transparency. The Bill provides for the preparation of a report and some information must be contained in it. I assure the good Senators opposite that I do not want to go against a level playing pitch. They would know my form in that regard. I would not do that. I take on board everything the Minister of State said and withdraw my amendment.

Amendment, by leave, withdrawn.
Section 9 agreed to.
Sections 10 to 12, inclusive, agreed to.
Title agreed to.
Bill reported without amendment.

When is it proposed to take Report Stage?

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