Tobacco Advertising and Promotion Bill

Public Bill Committee, 6 February 2001.

Standing Committee A

Clause 5 - Advertising: defences

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 26, in page 2, line 36, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

Humfrey Malins (Conservative, Woking)

With this it will be convenient to take the following amendments: No. 7, in page 2, line 41, leave out

`he could not reasonably have'

and insert

`it could not reasonably have been'.

No. 27, in page 2, line 44, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

No. 28, in page 3, line 3, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

No. 29, in page 3, line 3, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

No. 30, in page 3, line 11, leave out

had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

No. 35, in clause 8, page 4, line 9, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

No. 36, in clause 9, page 4, line 34, leave out

`had no reason to suspect'

and insert

`could not reasonably have been expected to know'.

Caroline Spelman (Conservative, Meriden)

This series of amendments would alter the phrase ``had no reason to suspect'' to ``could not reasonably have been expected to know'', which is a more practical and objective formulation of the same idea. When we debated clause 2 and touched on the defences that might be used, I was pleased that the Minister used exactly the same phrase at column 36 of the Hansard report of our proceedings. My ears pricked up at that reference because such wording is much easier for people to understand and to judge objectively. A third party could take the view that someone could reasonably have been expected to know something, whereas it would be more difficult to prove that someone had reason to suspect something.

It is difficult to prove the absence of possible suspicion. I am not a lawyer, but those who are will understand that it is important to have a defence that is workable in practice, if the Bill outlines certain offences. Under the law, it should be enough of a defence to prove that one did not know something, and that would be conveyed by the amendment. Suspecting something is more difficult to prove. One might suspect that various offences had been committed, but the test should be whether one would reasonably have been expected to know that they had been committed. That is a better way in which to phrase the provision, and I hope that the Government will accept our constructive suggestion.

The amendment would give the courts a wide power to examine all the surrounding circumstances if an offence had been committed and they could decide whether the individual ought reasonably to have known the consequences of that. We have considered several practical examples of people who may unwittingly display tobacco advertisements and have therefore thought of a form of words that would provide an adequate defence. The phrase would create a proper test and it is one that we commend to the Government. The group of amendments would all apply the same wording to the Bill. Such defences would be important if it were alleged that an offence had been committed and someone was taken to court.

Yvette Cooper (Labour, Pontefract and Castleford)

Given that the amendments are slightly different from each other, I shall refer to them in turn. Amendments Nos. 26, 27 and 28 would replace ``had no reason to suspect'' with ``could not reasonably have been expected to know''. They reflect the key argument made by the hon. Member for Meriden (Mrs. Spelman). It is not at all clear that there is any material difference between the two forms of wording, and it is hard to think of an example that might fail one test but pass another. If a vendor was given good reason to suspect, or was told that there might be a tobacco advertisement in a particular product and did not check, clearly, he had reason to suspect. He could also have been reasonably expected to know. He had the power to check, but did not do so. That case would fail both tests. I cannot think of an example of a case that would fail one test and not the other. The material difference is unclear.

Caroline Spelman (Conservative, Meriden)

Perhaps I can help. In many such situations, the problem is that no one is told anything. Even under the Minister's own formulation, the onus is on individuals to have their wits about them, and actively to search through magazines to find advertisements. It is quite possible that those going to court to defend themselves will not have been told anything. The accent is on what one should know without being told about it.

Yvette Cooper (Labour, Pontefract and Castleford)

In that situation, there is no difference between ``had no reason to suspect'' and ``could not reasonably have been expected to know''. Clearly, in a case in which tobacco advertising was banned and there was no reason to suspect that a particular magazine or product was breaking the advertising ban, the vendor would have a clear defence in law. It is not clear what difference there would be between defences under the two forms of wording involved. The Government do not intend any such distinction. Both phrases are used in legislation, although ``reason to suspect'' is far more commonly used.

The hon. Member for Meriden also made a point about courts having to take account of the particular circumstances involved, but that would be the case with either wording. With ``have no reason to suspect'', courts would need to consider the individual circumstances involved and whether people had reason to suspect, given their particular circumstances. The Government do not, therefore, accept amendments Nos. 26, 27 and 28.

Amendment No. 7 is different. It replaces ``he could not reasonably have'' with ``it could not reasonably have been''. I assume that the intention behind the change of wording is to make the clause more objective by reference to a reasonable person rather than a particular individual. However, the wording does not achieve that. With either wording, the courts will still examine the individual circumstances involved to discover whether a case could reasonably have been foreseen by that person. A change of wording would make no massive material difference. We should not create a test about a reasonable person, but we should take account of individual circumstances. A person in an advertising business might be in a far stronger position to foresee the effect of an advertisement or visual image than someone with no experience of advertising who is simply distributing the product to shops in a white van. The test should be about individual circumstances rather than an objective single reasonable person.

Amendment No. 29 would provide a specific defence for someone involved in ``publishing and distributing'' an insert that contains a tobacco advertisement. That person does not require a specific defence for clause 2(3), as that provision does not create a new offence but merely explains the extent of the offence under clauses 2(1) and 2(2). Clauses 2(1) and 2(2) are already subject to the sort of defence that amendment No. 29 would create—in clause 5(4) for distribution, and in clauses 5(1) and 5(2) for publishing. A specific defence for people involved in publishing and distributing products that involve a specific and separate entity is already in place in the Bill. However, the amendment raises an anxiety, although the amendment itself does not specifically deal with it, which relates to whether the publications referred to in clause 3—which deals with the proprietor and editor of the publication and everyone involved in the chain—include publications with an insert. If they do not, a seller covered by clause 3(c) commits no offence in selling a publication with an offending insert. If they do, the seller has a defence under clause 5(6). We shall consider that matter further and establish whether we need to clarify it. Amendment No. 29 raises a helpful issue, although the specific point with which it deals is unnecessary, because a defence has already been provided in the Bill under clauses 5(4), 5(1) and 5(2).

Caroline Spelman (Conservative, Meriden)

That is helpful. Perhaps, as I do not have a legal background, I am simply not familiar with enough different measures, but I was rather struck by the idea that people would have to prove that they did not suspect. Perhaps I do not have a suspicious mind, and perhaps we shall create lots of suspicious minds as a result of the Bill, but if that is the received legal perspective, I shall have to accept that it is widely used and that the courts are comfortable using it. I had hoped to achieve what seemed to me to be more objectivity, but according to the Minister's explanation the courts are used to trying to establish objectively whether a person should suspect something or not. No doubt they must do that a lot of the time in relation to other offences.

I was pleased to hear the Minister say that she would reconsider amendment No. 29. I may not have drafted it as well as I might, but she has understood our anxiety. The amendments relate to the Bill's workability. It is important to get the Bill right and as far as possible to anticipate the pitfalls that may arise with the wording if it is left unamended. On the basis that the legal system is comfortable with people having to prove that they did not suspect something, although I imagine that that is not always easy to prove, I accept that the clause has more objectivity than meets the layman's eye with its present wording. On the understanding that the Minister will reconsider amendment No. 29, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendments made: No. 18, in page 3, line 2, after `advertisement' insert

`, otherwise than as mentioned in section 2(4),'.

No. 19, in page 3, line 5, leave out subsection (5) and insert—

`(5) In relation to a tobacco advertisement which is published or caused to be published by electronic means by an internet service provider, it is a defence for him, if charged with an offence under section 2(1), to prove that he was unaware that what he published or caused to be published was, or contained, a tobacco advertisement.

(5A) In relation to a tobacco advertisement which is distributed as mentioned in section 2(4), it is a defence for a person charged with an offence under section 2(2) of distributing it or causing its distribution to prove—

(a) that he was unaware that what he distributed or caused to be distributed was, or contained, a tobacco advertisement,

(b) that, having become aware of it, he was not able to prevent its further distribution, or

(c) that he did not carry on business in the United Kingdom at the relevant time.'.—[Yvette Cooper.]

Question proposed, That the clause, as amended, stand part of the Bill.

Caroline Spelman (Conservative, Meriden)

I wanted briefly to have a stand part debate, as we are trying to make some progress. I should like to discuss a general issue that relates to clause 5 and to ask the Government about the style in which the Bill has been drafted. As an Opposition Front-Bench spokesperson, one scrutinises only a certain number of Bills during a Session. I have never come across this style of Bill—on the one hand, the Government set out offences of which people can be guilty, while on the other they set out a series of defences that can be used by people accused of those offences. The Minister might tell me that that is common, but it seems a strange way to proceed. I have considered several other Bills during my short parliamentary career that were not formulated in that way.

The Food Standards Bill, for instance, described serious offences of which people might be guilty, which might lead to lapses, food poisoning, and, ultimately, fatalities. However, that Bill was not formulated with offences on the one hand and defences on the other. This style makes it difficult, in some ways, to scrutinise the Bill clause by clause. It is difficult to debate properly the offences described without taking into account the defences that might be used. Perhaps that is a received part of the culture.

If I were a tobacconist or tobacco manufacturer reading the Bill, however, I would probably devote a great deal of time to looking at the defences that I might use, because I would realise that the stakes were quite high and that I had previously, as part of my normal custom and practice, put up tobacco advertisements or distributed literature that advertised tobacco. If I had been used to doing that for many years— even decades if it had been my job for most of my life—that would be a major change of culture. Clearly, the Government will be sending out a big signal in legislating to ban tobacco advertising. However, they are asking people who run such commercial premises to change the habits of a lifetime.

The clause should be read very carefully, as it outlines an important set of defences. The lay person must be aware of the defences that he can produce, the most important of which is being able to prove—I still prefer my formulation—that one could not reasonably have known that something was a tobacco advertisement, or, in the Government's formulation, that one had no reason to suspect that it was a tobacco advertisement. We therefore must return to the argument that, without certain definitions, it will be difficult to define a tobacco advertisement. In the past, a pile of cigarette packets would not have constituted a tobacco advertisement in the eyes of most people vending such products. Under the Bill, it will be necessary to know whether cigarette packets constitute a display, and, if so, how many. Unless that is clearly spelled out, people who have previously, legitimately and in a law-abiding manner carried out their trade will have to go to court to establish what is and is not an advertisement. Although the defences give scope to a person who has unwittingly committed an offence to defend himself, they are not completely watertight without a clear definition of an advertisement.

I am making a general observation about the style in which the Bill has been constructed. In relation to the swings and balances of offences and defences, it will be interesting to hear from the Minister why the Bill has been so constructed.

Ian Bruce (Conservative, South Dorset)

I certainly do not want to delay the Committee when we have insufficient time to discuss the Bill fully; nor do I want to adopt Government Members' Trappist tendency and allow the clause to be added to the Bill without pointing out how inadequately it covers the issue. The Government have published a Bill with a pile of loopholes that create a lawyers' charter. Conservative Members do not look forward to that bonanza, because unfortunately none of us is a qualified lawyer. Tobacco manufacturers spend £100 million a year on advertising and promotion and one can imagine the lawyers salivating as they look at clause 5 and saying, ``Look at all the wonderful sets of defences. We can get into court. We know that the tobacco industry successfully challenged the European Commission in the courts and won.''

I was contacted last evening by the Internet Service Providers Association, which is unhappy about the way in which the Government are dealing with issues relating to the internet. They told me that they had a meeting scheduled with the Minister a week on Wednesday, after the House has finished considering the Bill, to discuss how the Bill can be changed around. It is an inadequate Bill that will not do what is intended to do, and I am surprised that Labour Members have not leapt in and said to the Minister, ``Well, Minister, you ought to create a watertight Bill, not the dog's dinner that we have at the moment.''

We have already pointed out that Government Departments work in silos. When the Department of Trade and Industry found the regulation of investigatory powers legislation too complex, it passed it to the Home Office. The hon. Member for Pontefract and Castleford (Yvette Cooper) clearly, because of the dearth of talent on the Labour Benches, has a good career, but she has been given a dog's breakfast, and, unless she gets a grip on the Bill and provides something that will not go straight into the courts and involve us all in great expense—and not reduce tobacco consumption by a single cigarette—it will be one of the nails in the coffin of her political career.

Yvette Cooper (Labour, Pontefract and Castleford)

The clause sets out the defences for people who are involved in various aspects of tobacco advertising, promotion and distribution. Our approach is to set out a comprehensive ban on tobacco advertising and to provide for specific defences. I have made it clear from the beginning of our discussions in the Committee that that is our approach.

There is a reason behind that approach. Advertising is a fluid process, as is marketing. Companies continually change the way they appeal to us; they try to grab our attention by finding new ways to promote their products and new forms of advertising through sponsorship, coupons and so on—different ways of appealing to us in order to sell their products. That is what advertising and marketing are about.

How much more fluid is the process when one form of advertising is banned. International experience has shown that if one form of advertising is banned, money will flow into another form. That is certainly what has happened with tobacco advertising. We are well aware—even the hon. Member for South Dorset (Mr. Bruce) made the point in a previous sitting—that tobacco companies will look for loopholes and ways to get round the tobacco advertising ban. We do not doubt that various tobacco companies will attempt and, because of international constraints and so on, there will be a limit to how much we can do.

For those reasons, it is right to begin with a comprehensive ban and then to create specific, targeted defences. That will maximise our chances to have the flexibility to cope with new forms of advertising and new approaches. We shall then have targeted defences specific to the circumstances of individuals and companies at different stages along the chain of tobacco advertising and tobacco product promotion.

It is right that we provide some defences. I was not quite clear whether the Opposition were arguing that we should not provide particular defences for certain individuals. It is absolutely right that we should, whether it be for things that they could not foresee or could not suspect. It is also right that we should provide particular defences for those involved with the internet, because we note that there are particular circumstances there.

Ian Bruce (Conservative, South Dorset)

I think that my hon. Friend the Member for Meriden would agree that we do not have in the Bill a proper definition of what an advertisement is and what is banned. So we start off with an ill-defined offence and then we have a set of ill-defined defences against it. That is the basis of our objection to clause 5.

Yvette Cooper (Labour, Pontefract and Castleford)

We have had this discussion already. The word ``advertisement'' is used in legislation; it is common for words in legislation to have their natural meaning. We have had a detailed debate about advertisements, and it is perfectly acceptable and sensible that the Bill takes the approach of a comprehensive ban on advertising, with specific defences.

We have addressed in the Government amendments the points raised about internet service providers because we recognise the position of those involved in electronic distribution. Officials have had all kinds of discussions with ISPs and the Department of Trade and Industry on the issues around e-commerce. I recognise that ISPs have concerns, and we have given them reassurance both in the Government amdts and by making our intentions clear in an earlier debate.

Ian Bruce (Conservative, South Dorset)

Will the Minister be having a meeting with the ISPA immediately after the Bill finishes its passage through the House of Commons?

Yvette Cooper (Labour, Pontefract and Castleford)

I understand that a meeting is scheduled between officials and the internet service providers, and I can also tell the hon. Gentleman that officials have had other conversations and contacts with ISPs and continuing discussions with the DTI to ensure that the Bill is fully compatible with the e-commerce directive and that we are fully up to date. We recognise that this is a complicated area, especially given the international issues involved, but it is a sensible approach to set out a comprehensive ban on tobacco advertising and then to set out specific, legitimate defences for individual circumstances, because in that way we will maximise our chances of reducing the kind of tobacco advertising that is so damaging to public health and especially to the health of children.

Question put and agreed to.

Clause 5, as amended, ordered to stand part of the Bill.

Clause 6 - Specialist tobacconists

Humfrey Malins (Conservative, Woking)

As we have had a fairly wide-ranging debate on specialist tobacconists, I may not allow a clause stand part debate. It will depend on how this debate goes.

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 9, in page 3, leave out lines 18 to 20.

Humfrey Malins (Conservative, Woking)

With this, we may discuss the following amendments: No. 32, in page 3, line 21, leave out `shop' and insert `business'.

No. 31, in page 3, line 22, leave out `half' and insert `one third'.

No. 33, in page 3, line 22, leave out

`on the premises in question'.

No. 34, in page 3, line 28, after `available', insert

`(or, if the most recent period for which accounts are available is different from twelve months, that period recalculated to an equivalent twelve month period on a pro rata basis)'.

No. 46, in page 3, line 34, at end add—

`(5) No offence is committed under section 2 and 3 in relation to an advertisement which is limited to the provision of particulars about a specialist tobacconist and the fact that it sells tobacco products.'.

Caroline Spelman (Conservative, Meriden)

I hope, Mr. Malins, that you will be sympathetic to our taking a little time over the way in which specialist tobacconists are to be regulated. We are talking about a lot of small businesses, many of them family businesses built up over a long period. What they have been doing will change, all of a sudden, from being legal to being illegal—potentially, if they get it wrong. Therefore, it is important that we help them by drawing from the Government as much detail as possible about how they will be affected by the Bill. Although the amendments have been grouped together, they are different. I cannot promise to deal with them as swiftly as we dealt with the previous group.

There are at least 350 cigar suppliers in this country. Many of those businesses are small and their owners will be listening attentively to the debate on this clause. Government and Opposition have a responsibility to speak up for the smaller players, as it is not easy for them to change rapidly how they do things—they do not always have the flexibility of large corporate players.

Amendment No. 9 would remove subsection (1)(c). It is a probing amendment, relating to our worry that small businesses may have to go to court for a ruling about what qualifies as a tobacco advertisement on their specialist premises. Hitherto, owners of such businesses have had to advertise to pursue their livelihood, so what they are permitted must be crystal clear. My hon. Friend the Member for South Dorset referred to the failure to define ``advertisement'', which is the fundamental flaw in the Bill. That will hamper specialist tobacconists in knowing what they may do on their premises and in their business.

It would not be easy for a small business to go to court for clarification on this matter; it would cost a lot of money, and many would be deterred by the hurdle of going to court. Some business owners accused of the offence might feel that they would rather give up than go through the rigmarole, cost and indignity of having to go to court.

The amendment is designed to impress upon the Government that hiving off clarification into regulations by an ``appropriate Minister'' is not satisfactory for the specialist tobacconists, as they remain unclear about what qualifies as an advertisement. The Minister may help us over the guidance. She said that she would consult before it was issued, and I urge her to do so with those small specialists. They should not simply be lumped in one camp, as some have shops and some do not, so we need to ensure that the Government catch in their consultations all those likely to be affected. At the preliminary stage of debate on the Bill, the Government may not have realised that some of those 350 cigar manufacturers do not have a shop per se, and that that is why they depend so heavily on mailings. Those businesses need clarification about what is allowed.

Amendment No. 32 is not a probing amendment. I hope that it offers a constructive and sensible suggestion. Not all specialist tobacconists have shops—I hope that that message has got across loud and clear. If the Government want the Bill to work well, they should pay attention to the word ``shop'', which is too constraining and will not catch all the businesses that they hope to catch with the tobacco advertising ban. The amendment is self-explanatory and I hope that the Minister will agree to the change. If she leaves the word ``shop'', there will be consequences, because some specialist tobacconist shops are part of a chain. What would happen if shops within such a chain were treated differently? It is not impossible that that might happen. The word ``shop'' may trip the Government up in their intentions.

A chain may also have one shop that means that it qualifies, in the aggregate as a specialist tobacconist, although the other shops in the chain do not qualify separately. That does not sit well with the clause. The chain may be both a specialist and non-specialist supplier and we must decide how such a business would be affected by the Bill. Using the word ``business'' would clarify the matter. The clause as it stands will simply not work in practice, so I hope that the Government will reconsider the wording. Left as it is, it will weaken the Bill.

Amendment No. 33 relates to where the trading of tobacco products is carried out and would catch the specialist tobacco businesses that deal mainly, if not wholly, through mail order and web sites. Such businesses may not have a retail outlet on a high street, but trade their specialist products, which are often of high value, in a different way. As the clause pertains to specialist tobacconists, it should deal with the diverse way in which they retail. We need guidance from the Minister as to how those sales will be regarded for sales threshold qualification purposes, if they take place away from the principal shop premises. That brings us back to the previous amendment. The clause is constrained and weakened by the use of the word ``shop''.

Amendment No. 34 is different again. It is designed to provide a reasonable degree of protection for small businesses starting out. Specialist tobacco businesses come and go in different locations; because of business rates and fluctuations in trade, it is not easy to hold one's place on the high street. The clause may place an excessive burden on a new business. All hon. Members would accept that a fledgling business in its first 12 months of trading—regardless of the product in which it deals—cannot operate to full strength, and will find it difficult properly to assess how things are going. Inevitably, such businesses have to face high capital costs up front when they start up.

The amendment would change the clause, so the period could be

``recalculated to an equivalent twelve month period on a pro rata basis''.

It is a probing amendment that would protect start-up businesses.

Yvette Cooper (Labour, Pontefract and Castleford)

I struggled to understand amendment No. 34. Could the hon. Lady say a little more to clarify what difference the wording of amendment No. 34 would make in practice? What is the difference between the words

``or, if the most recent period for which accounts are available is different from twelve months, that period recalculated to an equivalent twelve month period on a pro rata basis''

and the wording in the Bill?

Caroline Spelman (Conservative, Meriden)

It is an attempt to achieve a pro rata effect. If a business has been operating for only a short time, in assessing the proper sales level, the Government should take full account of the pro rata pattern of sale. It is as simple as that. Its purpose is the same as that of the Government: to be reasonable in calculating the volume of sales.

Kevin Barron (Labour, Rother Valley)

Why should we?

Caroline Spelman (Conservative, Meriden)

In the early stages of operation, it is difficult for a small business to calculate accurately what its volume of sales will be. It may be fortunate, when it starts up, to sell a great number of products and will continue on a high for a long time. Typically, however, that is not the case and sales take some time to get off the ground because customers have to find the location—or relocation—of the business. It takes time to arrive at an accurate reflection of the quantity of product that is sold.

Amendment No. 46 is a probing amendment to clarify that generic advertising by specialist tobacconists will not be illegal. Specialist tobacconists do not usually sell anything other than tobacco products and accessories. They need guidance from the Minister about what they can and cannot do. Under clause 6, as drafted, they would not enjoy the protection that the defences have given to other suppliers of tobacco products. Specialist tobacconists are a group for whom we need to work hard to make it clear what they may or may not do. A simple statement from a specialist tobacconist about the existence and location of the business and the wording, ``Suppliers of fine cigars'', for example, may be considered an advertisement under the Bill.

The failure to define ``an advertisement'' at the beginning of the Bill does not make it easier for specialist tobacconists. We appreciated the concession that they could continue to put their name, address and telephone number in Yellow Pages, but we did not get to the bottom of what other generic advertising may be illegal in future.

Ian Bruce (Conservative, South Dorset)

I was grateful to the Minister for saying that that was what the Bill meant, but that is not what a judge might say is the position on Yellow Pages. We ought to make it clear that Conservative Members do not guarantee that someone who advertises their name in Yellow Pages as a seller of fine tobaccos will not be prosecuted under the Bill.

Caroline Spelman (Conservative, Meriden)

Once again, we are back to the trouble with this Bill. As it stands, a small business may have to go to court for a ruling. Members of the Committee will probably recall that my hon. Friend brought with him an example from Yellow Pages, which helped to illustrate what my amendment is driving at. My hon. Friend may have it with him, but as I recall, under ``Tobacconists'' the page listed a series of telephone numbers and addresses of specialists.

Ernie Ross (Labour, Dundee West)

Here we go again.

Humfrey Malins (Conservative, Woking)

Order.

Caroline Spelman (Conservative, Meriden)

I have to state for the purposes of Hansard that the central section lists tobacco retailers. We understand from the Minister that it would be legal to continue in that way. A series of other businesses that advertise on the same page have larger slots. If I understand it correctly, we are going to make it illegal for tobacco retailers to do the same, but they will not have been used to that. Some who saw other purveyors of retail articles advertise in Yellow Pages products such as recording and cleaning machines and a range of other items might advertise because it was common practice. They will get the message that there is a ban on tobacco advertising, but they might wonder what they can do beyond putting their names and addresses in Yellow Pages. The guidance becomes all important at that stage.

Under the amendment, retailers of specialist tobacco products could be certain that they could include details about their existence, location and activities in directories, references and books and on websites, but they need clearer guidance on what other forms of generic advertising that pertain to their businesses, such as signs saying ``Suppliers of Fine Cigars'', may be outlawed.

Retailers will find it difficult to accept such constraints on their normal commercial practice. The guidance about what specialist tobacco suppliers may do is not crystal clear. As I have said on numerous occasions, it is unreasonable to expect specialist tobacco retailers to test the opinion of the courts as to what constitutes a generic advertisement for a specialist tobacco product. It should be clearly stated that generic advertising that does not specify a brand will be permitted. A sign that reads ``Suppliers of Fine Cigars'' gives no indication of brand. If we want to cut smoking prevalence and we know that branded products are the driving force behind that prevalence, we must re-examine what generic advertising a specialist tobacconist may be allowed.

The group contains a number of different and unrelated amendments that are designed to make the clause clearer for specialist tobacconists, who will read with great attention the Minister's response. I hope that she will accept the spirit in which the amendments were tabled. The aim was to make the clause more workable for small businesses that do not have the resources to clarify in court what we, as legislators, should be able to clarify for them.

Ian Bruce (Conservative, South Dorset)

On amendment No. 32, will the Minister clarify what is the difference between retail and wholesale? In clause 4, it is clear that a wholesaler selling to a retailer can send any communication as long as it goes there directly, but there are problems with banning advertising or allowing advertising only in certain areas. Line 21 refers to a

shop selling tobacco products by retail.

A number of businesses, such as wholesalers that sell to retail tobacconists and the retail alcohol trade—off-licences and publicans—may be selling to two completely separate audiences. Wholesalers that have a legitimate advertising and promotional strategy may have people entering their premises who may be not tobacco retailers, but retailers of other products. That will create a minefield—individuals who purchase products other than tobacco from the wholesaler will be faced with advertisements and promotional items. That will, in effect, encourage them to become smokers or to buy a particular brand for their own consumption.

To specify that exemptions apply only to retailers, not wholesalers, is an example of poor drafting that may lead us into yet another minefield. Legitimate wholesalers that are carrying out promotion work to retailers might be excluded from doing so, because they may be in contact with retailers who buy other products from them.

What about a wholesaler such as Makro? Only retail businesses can have Makro cards, yet I suspect that 90 per cent. of its customers are buying goods for their own consumption. Does the Minister have any thoughts about whether a wholesaler that, in effect, sells cigarettes to people for their own consumption will be excluded from so doing under the Bill when it advertises or takes part in promotional activity within the store, by the use of the word ``retail'' in line 21 of the clause?

Caroline Spelman (Conservative, Meriden)

I hope that the Committee will bear with me. I am missing my Whip this morning. He would have kept me in order. My hon. Friend the Member for Mid-Worcestershire (Mr. Luff) sends his apologies to the Committee— following a trip to France, he has food poisoning. No doubt, he would have pointed out to me that I had not explained amendment No. 31. I wish to deal with all the amendments together, albeit that they deal with different items.

Amendment No. 31 would reduce the amount of products that would be calculated for total sales from one half to a third. I shall explain the reasoning behind it. The required 50 per cent. threshold of total sales of

``cigars, snuff, pipe tobacco and smoking accessories''

is high, when we take into account that a high percentage of the sales price of cigarettes and hand-rolling tobacco comprises excise duty. The duty on pipe tobacco and cigars is lower and, in general, it is not applied to other smoking accessories. It is therefore easier for sales of cigarettes and hand-rolling tobacco to be high and for those sales not to be of as great significance to the profit margin of the specialist tobacconist as sales of cigars, pipe tobacco and smoking accessories.

That there is differential excise on different tobacco products is an important point. The threshold for qualification as a specialist tobacconist should be reduced from one half to one third. Without the amendment, there is a great risk that certain specialist tobacconists that are not necessarily represented by a big lobby or have any particular clout in respect of certain legislation will be discriminated against. Differential excise duty will affect the calculation of sales on which the clause is based. I am grateful that the Committee has allowed me to explain the amendment, which otherwise might not have been clear.

Yvette Cooper (Labour, Pontefract and Castleford)

I shall speak to each of the amendments in turn, as they would have different effects. Amendment No. 9 would remove the regulation-making power relating to specialist tobacconists. We do not anticipate using the powers. The status quo on advertising in the average specialist tobacconist shop is fine by us. The power to introduce regulations is provided to cover future developments and in case the defence for specialist tobacconists is abused and used to promote tobacco advertising in a way that goes against the broad intentions behind the Bill. I refer not to the promotions or advertising that take place in the average specialist tobacconists at the moment, but to new forms of advertising and developments that we have not anticipated that may arise under the defence provided in clause 6. Let us suppose that cigars become the big fashion among teenagers and the big tobacco product that all teenagers want to smoke, or that a specialist tobacconist product becomes the fashionable product for children and results in anxiety about children on public health grounds. It is not the intention behind the Bill that a loophole should be allowed to develop.

If present circumstances continue, we do not anticipate using the powers. However, we believe it right, given the broad intentions behind the Bill, to take the powers in reserve. It is clear in the Bill that specialist tobacconists may advertise cigars, snuff and other specialist tobacconist products anywhere on their premises.

Amendments Nos. 32 and 33 are related. They are designed to end the focus on the shop and focus instead on the business. It would be wrong to broaden the defence for specialist tobacconists to include all forms of business as opposed merely to shops and for good reason. The rationale behind the limited exemption for specialist tobacconists, which relates to the European directive, was that people who go into such shops have already decided that they are interested in purchasing tobacco products.

A purist argument would be that we should prevent all tobacco advertising in specialist tobacconists except at point of sale, regardless of who they are, because they promote and sell tobacco products. We have not taken that approach. We accept that they should have a specialist exemption because people have already chosen to purchase a product or have already decided that they are interested in purchasing a tobacco product when they walk in the door.

However, that principle does not apply to mail order, for example. It does not apply to business conducted beyond the walls of that shop. Why should specialist tobacconists be allowed to bombard households with direct mail about tobacco products, even if those products may be less harmful, depending on how they are smoked? Why should they be able to advertise over the internet or anywhere else tobacco products to people who have not walked into the premises and chosen to go into a tobacco shop to buy a product?

Caroline Spelman (Conservative, Meriden)

One answer is that, if the United Kingdom contains only 350 cigar manufacturers, having a shop in a particular village or town would mean that much of the customer base of those manufacturers would be simply too far away for practical purposes for the sale of such products. There are simply not enough of them when divided among 57 million people.

Yvette Cooper (Labour, Pontefract and Castleford)

Like everyone else, manufacturers are allowed direct point-of-sale advertising, including on the internet, subject to the regulations. Like everyone else, they can respond to requests for information about their products, just as we have said that other forms of tobacco product vendors or producers should be able to do. However, this is a public health Bill and we judge these exemptions on whether or not people are promoting tobacco products.

There is a distinction between those who walk into a tobacco shop and decide that they want to purchase and those who have not decided whether they want to purchase cigars or anything else receiving mailshots, coupons or any other form of unsolicited advertising through the post. Such people may be trying to give up smoking. Why should we allow that type of exemption? We can accept an exemption if people have already made the choice, but there is no clear justification for an exemption for specialist tobacconists. They will have the same ability as everybody else to do direct point-of-sale advertising on the internet, or to communicate with their customers, subject to the rest of the Bill. However, it would be wrong on public health grounds, given the overall aim of the Bill, to allow a particular sort of direct marketing and advertising to continue.

Ian Bruce (Conservative, South Dorset)

I am still struggling to work out where the Bill allows people to advertise their product at point of sale and where it states what is an advertisement. Simply having a cigarette packet in view clearly is an advertisement, but where does the Bill allow the physical activity of retailing to go on, where somebody goes to purchase a packet of cigarettes, or whatever, outside a specialist tobacco shop? Where is the defence in the Bill?

Yvette Cooper (Labour, Pontefract and Castleford)

I was rapidly flicking through the Bill as the hon. Gentleman was speaking. Clause 4(2) states:

``The display or advertisement in a place or on a website where tobacco products are offered for sale, in accordance with any requirements specified by the appropriate Minister in regulations, of the products offered for sale there and of their prices is not an offence under this Act.''

We had a detailed discussion of that under clause 4; we have in fact already amended it. I am reading from the original draft of the Bill; we have already passed Government amendments that make it clear that there is a distinction between advertising and display.

We will return to the issue. I have already signalled the Government's intention to table further amendments to make clearer the issues around display, because we need to separate out some specifics on both display and advertising. We have made it clear that advertising at point of sale is to be permitted, but subject to regulations on which we will of course consult. That applies to specialist tobacconists selling outside their shop in the same way as it does to everyone else.

Amendment No. 31 refers to the proportion of sales of tobacco products required for a business to be counted as a specialist tobacconist. In the end, we draw the line where we choose, but it is sensible to say that someone can be counted as a specialist tobacconist if the majority of the products sold are specialist tobacco products. To make it the majority—50 per cent.—seems to me perfectly reasonable and to draw the line any lower would make it hard to see whether people were specialist tobacconists rather than some other sort of vendor who also sold some specialist tobacco products. Most people would regard 50 per cent. as reasonable, because that allows us to say that the majority of products sold by a shop are specialist tobacco products.

Caroline Spelman (Conservative, Meriden)

Does the Minister accept the practical point, which is that the differential excise duty may drive the split in the sort of products that a business vends? That is getting perilously close to Government dictating what a specialist supplier should or should not sell. That will be the effect of regulation.

Yvette Cooper (Labour, Pontefract and Castleford)

In the end, they can sell what they like. We are saying that they can have a defence under the Bill if they sell more than 50 per cent. specialist tobacco products. If they do not, that is fine; they have the right to sell whatever products they want, but if they do not sell more than 50 per cent. specialist tobacco products, we will not count them as a specialist tobacconist for the purposes of the Bill and we will not give them a defence. That is reasonable.

I am still struggling to understand the purpose of amendment No. 34. The Bill states that businesses will be assessed for as long as they have been established, if they have not been established for 12 months. It is a question not of the overall volume of sales, as I accept that that may grow during the year, but of what proportion of the sales comprises specialist tobacconist products—be it for three months, six months, or whatever period. We could not legitimately make the assessment on the basis of any information other than sales. I am not clear what the difference is between making the assessment on the basis of the three months or of a pro rata projection from that three months. In the end, the proportion of sales that are specialist tobacco products within that three-month period is what counts—whether or not it is multiplied in a pro rata calculation for 12 months. I do not understand what the amendment would achieve and I reject it for that reason.

Amendment No. 46 is an attempt to clarify the sort of advertising and information provision that specialist tobacconists will be allowed. We have had the discussion before so I will reiterate what I said and give an example as further clarification.

We intend to prevent specialist tobacco companies not from advertising their business but from advertising their tobacco products outside their premises. For example, they will be allowed to place an advertisement in the Yellow Pages that says something like, ``J.R. Hartley, Specialist Tobacconist, sells cigars, pipes and snuff''. However, a half-page advertisment that said, ``J.R. Hartley, cheapest Davidoffs in town, half-price snuff, finest range of sophisticated cigars—smoking a Cuban cigar makes you sophisticated'', would clearly be promoting tobacco products. We do not want to permit such promotion and that is the entire point of the Bill. It is clear from our wording that specialist tobacconists will be allowed to provide information and listings in the Yellow Pages, but not to use it to promote and advertise tobacco products.

The hon. Member for South Dorset asked a question about retail, but I was not entirely sure what his concern was. A defence under clause 4(1)(a) states that

``a communication made for the purposes of the tobacco trade''

is not covered by the Bill, as long as it is

``directed solely at persons engaged in any capacity in that trade''.

If the communication is directed more broadly, beyond that trade, it is not covered by the defence and will be caught by the Bill.

Ian Bruce (Conservative, South Dorset)

People who go to a specialist tobacco wholesaler to buy other products may see the advertising and promotion. I wonder how the Government will protect the wholesaler specialising in tobacco sales, who is not covered by the retailer defence—[Interruption.] It is difficult for me to concentrate on such a difficult matter with constant heckling from a sedentary position. I cannot hear a word that the hon. Member for Dundee, West (Mr. Ross) is saying. If he wants to intervene, I shall be pleased to take the intervention.

Ernie Ross (Labour, Dundee West)

It is a contradiction in terms—

Humfrey Malins (Conservative, Woking)

Order. The hon. Member for South Dorset was intervening, and we cannot have an intervention on an intervention.

Yvette Cooper (Labour, Pontefract and Castleford)

The significance of the word ``retail'' is still not clear to me. I give way to my hon. Friend the Member for Dundee, West.

Ernie Ross (Labour, Dundee West)

If the person is a wholesale specialist tobacconist, all he will be wholesaling is specialist tobacco products.

Yvette Cooper (Labour, Pontefract and Castleford)

My hon. Friend is right. We want to prevent people who are intending to buy other products that are not related to tobacco from being bombarded by tobacco advertising. That is why a specialist tobacconist is defined as a shop in which more than 50 per cent. of sales derive from tobacco products. That is to minimise the possibility of someone intending to buy goods that are not related to tobacco. If people intend to buy such items, why enter a specialist tobacconist? The whole point of the clause is to ensure that specialist tobacconists are those that deal with tobacco products, thus people who enter such premises will have already decided that they are interested in tobacco products. Under those circumstances, tobacco advertising within such premises is acceptable.

Ian Bruce (Conservative, South Dorset)

The hon. Lady and her hon. Friend have obviously missed my point that a specialist wholesaler may sell two different products. For example, it may sell fine wines and expensive alcohol and specialist tobacco products at the same premises. A customer may enter premises to purchase only alcohol products, but be affected by tobacco advertisements. It is strange that only retailers have the defence whereby they can advertise such products rather than wholesalers in the same position.

Yvette Cooper (Labour, Pontefract and Castleford)

That is because wholesalers have a different defence under clause 4(1)(a), which comes into effect if they have a

``communication made for the purposes of the tobacco trade and directed solely at persons engaged in any capacity in that trade''.

The retail defence is set out for specialist tobacconists that are engaged in the retail trade. We should distinguish between wholesalers and tobacco advertising within specialist tobacconist retailers.

Ian Bruce (Conservative, South Dorset)

What will happen when a customer who goes into a wholesaler that is not a specialist tobacconist to buy fine cognac is offended because he is bombarded with promotions and advertisements for tobacco products and wants the wholesaler to be prosecuted? The wholesaler will have no defence.

Yvette Cooper (Labour, Pontefract and Castleford)

The wholesaler has the defence if communications are directed solely at people engaged in any capacity in the tobacco trade. It is reasonable that wholesalers have a defence in respect of those involved in tobacco trading and not other matters. I do not see a problem. However, I shall scratch my head and reflect further on the matter to see if I can come up with a problem because the hon. Gentleman is being so persistent.

I think that I have covered all the amendments in the group. The Government cannot accept any of them.

Caroline Spelman (Conservative, Meriden)

You have given us advance warning that you will not allow a stand part debate, Mr. Malins, so my remarks will comprise general observations on clause 6. Our proceedings have been disappointing, given that we have discussed matters in a good-natured way. We have tried to be constructive. To sum up what the Minister said—basically, she has told specialist tobacconists that they must lump it. She showed little sympathy.

Mr. Ernie Ross indicated assent.

Caroline Spelman (Conservative, Meriden)

The hon. Gentleman nods. It is my nature to be consensual and I do not usually make such remarks, but the Government's attitude showed arrogance. Commercial activities that people have carried on legitimately for many years will suddenly become illegal. That is a big change for practitioners to assimilate and small businesses will be worst affected. The Government said that they had listened to small business. What I heard was a remarkably hard-hearted and hard-nosed attitude. There was little appreciation of the practical arguments that I was trying to put forward.

The total rejection of all my amendments could have interesting and unforeseen consequences. To achieve a better defence under the Bill, suppliers of specialist tobacco products could be forced to set up a shop; they could then at least cover themselves by saying, ``At least we have a shop''. That might produce a rash of tobacconists on the high street—who knows? That may be the effect of going about the legislation in a heavy-handed way without taking account of the practicalities.

There may be another effect. The differential excise duty means that retail sales have been bumped up by sales of cigarettes with the higher excise duty on them. One has to sell a lot more cigars and other specialist tobacco products now to qualify to be a specialist tobacconist. It is not the tobacconists' fault that there is differential excise duty on tobacco products: they have no control over that. It is within the gift of the Government to vary the excise on different tobacco products. Their stance is remarkably rigid.

My amendments on specialist tobacconists have been rejected, but I still find it difficult to imagine a time when the youth of today will have the disposable income—and the desire—to buy cigars. The Minister must have had a privileged education: at her school, youngsters had enough money to buy cigars to smoke behind the bike shed. Where I came from, they jolly well did not—there was no way we could get that sort of money. Anyone who smokes—and I do not—knows that one cannot chain-smoke cigars without feeling queasy by the second or third.

The Minister's argument lacks common sense and a user-friendly attitude towards the small players who will be hit hard by the legislation. She could have come a little way towards meeting me. I do not feel so strongly that I am prepared to press the amendments to a vote. The Government have a socking great majority—[Interruption.]

Humfrey Malins (Conservative, Woking)

Order. There are too many sedentary interventions.

Kevin Barron (Labour, Rother Valley)

Will the hon. Lady give way?

Caroline Spelman (Conservative, Meriden)

No. The Government have a socking great majority and can get their way. My general observation of their attitude towards the debate on the amendments and the clauses is that it is incredibly harsh-minded towards small businesses. They fail to recognise that many specialist tobacconists are now outside—

Kevin Barron (Labour, Rother Valley)

Will the hon. Lady give way?

Caroline Spelman (Conservative, Meriden)

No. Many special tobacconists will now fall outside the definition of a specialist. If the Government had stood back and thought with more common sense about specialist tobacconists and accepted one or two of the amendments, they would have made a difference without opening the floodgates or creating a massive loophole. In practical terms, that would have given specialist tobacconists a reasonable defence that will now be denied to some of them.

Kevin Barron (Labour, Rother Valley)

Briefly, the hon. Member for Meriden takes the matter out of context. Many people argued that clause 6 should not be in the Bill because it protects the interests of specialist tobacco shops. The hon. Lady wants to amend it into a nonsense, while saying that she doubts whether it should be there, but she is here, supposedly, to represent the interests of those small businesses. The Government have done that and, in doing so, have not taken all parts of the public health lobby along with them on the clause. That ought to be a matter of record in this Committee.

Amendment negatived.

The Chairman, being of the opinion that the principle of the clause and any matters arising thereon had been adequately discussed in the course of debate on the amendments proposed thereto, forthwith put the Question, pursuant to Standing Orders Nos. 68 and 89, That the clause stand part of the Bill.

Question agreed to.

Clause 6 ordered to stand part of the Bill.

Clause 7 - Developments in technology

Caroline Spelman (Conservative, Meriden)

We are making swifter progress. I am anxious that we should have the chance to debate the latter clauses of the Bill, and, indeed, the new clauses, properly. We have only three sittings left and Labour Back Benchers have tabled a new clause, which we obviously want to have time to debate. Nevertheless, it is important to ensure that we do not let a clause slip through on the nod, which is why it is important to debate clause 7 stand part.

The clause typifies the catch-all attitude of the Bill and I question its legislative relevance. As I said, we have not even succeeded in legislating adequately for existing new technology, such as internet provision—disquiet among internet service providers is evidence that we have not got that part of the Bill right. It is ambitious to have a catch-all phrase designed to deal with any subsequent developments in technology relating to publishing and distribution by electronic means that we have not even thought of. It is so futuristic as to make it almost irrelevant. It is more of a statement of intent than a real piece of legislation; it is so generally worded—

Maria Eagle (Labour, Liverpool, Garston)

Stupid.

Caroline Spelman (Conservative, Meriden)

I hear the hon. Lady saying that that is stupid. Perhaps she would like to tell me what she would regard as ``any developments in technology''. Does she have a better idea than I as to what is in the pipeline? Of course we do not know. That is a catch-all phrase that makes it singularly meaningless to debate it now, and it will never be debated again when it is brought into effect.

If technology moved on sufficiently to create the circumstances envisaged in the clause, there would undoubtedly have to be new general legislation to apply existing laws to the new methods of commerce, just as in the case of recent electronic commerce legislation. The provision would be far better placed in such legislation, where the focus of those making the legislative decisions would be on what capacity the new technology had to make an impact.

I argued strongly at the beginning of our debates that the section on internet service providers and their role in advertising ought to be part of a Bill that dealt properly with their role in advertising a range of products, outside of a health Bill and in a Bill under the Department of Trade and Industry—a Bill that dealt with new forms of competition by electronic means.

It is ambitious to have this catch-all phrase in a Bill to ban tobacco advertising. It is unnecessary to put a single provision into a specific Bill, since any change in technology would require general legislative change. Just as there may be developments in technology relating to transmission by electronic means, with regard to which the Secretary of State may consider it appropriate to amend provisions of the enacted Bill, there might also be developments with regard to tobacco products, which would similarly call for amendment. Tobacco producers may find a hitherto unthought-of form of tobacco that can be absorbed by osmosis or some other means. Who knows? We cannot legislate now for unknown technological change.

There may be some justification for including in the Bill tobacco products that may be developed at some time in the future and to which the health risks that result from smoking tobacco products do not apply. A new tobacco product may have an important public health dimension, which would correctly be dealt with under this Bill. If it is not possible to promote a new tobacco product to existing smokers, as would be the case under the Bill, manufacturers cannot be expected to invest in the funds necessary to diversify into products that might pose a lower health risk. The fact that such products have not been developed and have not appeared on the market to date does not mean that such developments are not possible. We all accept that scientific knowledge and capabilities advance rapidly. None of us can accurately predict in which direction it may flow. The legislative relevance of the clause is therefore difficulty to justify. I question its place in the Bill.

Ian Bruce (Conservative, South Dorset)

I have warned the Government about the way in which the Bill would allow the internet to be used to get round the ban on advertising. The clause gives the Government additional powers, through the affirmative procedure, to make amendments in future. Such powers may break the European convention on human rights.

The Secretary of State says that he does not believe that the Bill is incompatible with the provisions of the Human Rights Act 1998. For the sake of clarity, I have a copy of that Act in front of me. Schedule 1 contains the convention and paragraph 1 of article 10 on freedom of expression suggests that anyone can say anything that they like. However, paragraph 2 enables the Government to restrict people's freedom of expression on the grounds of protection of health. I am sure that that is what gives the Government confidence that they can legislate in this sphere.

Under section 12 of the Human Rights Act, however, someone may claim that they can still advertise tobacco in the United Kingdom on the grounds that the material has or is about to become available to the public. One of the defences is that, if the information will be available anyway, it should be possible to give it out within the United Kingdom. Otherwise, the individual's human rights are being superseded by the Act. That defence was used in the case of the former MI6 officer who published information that, under statute, it was illegal to publish in this country. Nobody disputed that it was illegal. He also had a contractual duty not to publish that information. He had it published, perfectly legally, on the internet. So he can go to the courts in the United Kingdom and say, ``Look, my rights under the Human Rights Act 1998 are being violated''. The clause would give the Government the power continually to change the rules to prevent use of the human rights defences in the Human Rights Act 1998.

I believe that the Minister—although she referred specifically to her officials—will meet people from the Internet Services Providers Association when the Bill has already gone through Third Reading. The clause would give the Government the power to alter the way in which they operate without our knowing the position beforehand; there may be Ministers who would be much more draconian and ban every type of promotional activity. If we allow the clause through, we may discover that the Government have got around Parliament.

Kevin Barron (Labour, Rother Valley)

I find it difficult to understand the Opposition's logic. Clearly, the clause is not operable now because we do not know of any potential changes in technology. One or two members of the Committee have suggested that we should include such catch-all provisions, not because of new technology but because some of us—including me—find the technology of the present difficult to grasp.

The hon. Member for South Dorset mentioned human rights, which operate in respect of any legislation and have no specific relevance to the clause. We will have to consider whether someone could breach the Official Secrets Act 1989 by using the internet and using that as a defence in a court of law. However, that does not mean that we should not introduce a clause such as this one, in an attempt to second-guess new developments in technology that could be used to promote tobacco, which damages the health of the public. It is logical to introduce such a clause; the Government are not attempting to get round Parliament. Perhaps my hon. Friend the Minister could address the matter, but as I understand it, any regulation would have to be debated in Parliament. The clause means that we will not block up parliamentary time bringing statute in on the Floor of the House, and will allow us to deal with the matter through simple regulations.

Ian Bruce (Conservative, South Dorset)

The hon. Gentleman is passionate about the subject, so I am sure that he understands the difference between primary legislation and statutory instruments, which are unamendable and present a yes/no situation. We should deal with such issues on the Floor of the House—especially given that the Government are already discussing with the ISPA about how they may modify the Act even before it has become one.

Kevin Barron (Labour, Rother Valley)

I understand the difference between statute and legislation through statutory instrument. I entered the House in 1983, and saw the use of the statutory instrument grow under the previous Conservative Government. It is a sensible way of creating legislation; debating a clause such as this, which can be operative only when it contains detail, would take time on the Floor of the House. We have many better things to do. Most legislation that is debated in the House contains similar clauses, because the Government want not to get round Parliament but to make government work more sensibly.

The hon. Member for South Dorset talked about meeting the ISPA. The Government have ongoing meetings with all lobbies and organisations. The ISPA may be able to help to frame regulations within clause 7.

Yvette Cooper (Labour, Pontefract and Castleford)

The purpose of the clause is to set a power to amend any provision of the Bill

``in consequence of any developments in technology relating to publishing or distributing by electronic means.''

The power has to be set in consequence of developments in technology, not because the Government feel like changing the Bill. It must to be done in response to those developments in technology. The reason why we specify developments in technology around electronic means rather than around tobacco products is that tobacco products are covered by the Bill. If new tobacco products are developed, they will be covered by it. It is true that new products, which are not tobacco products, but cause us concern, are not covered. If they are not tobacco products, they will raise different issues and it would be right to have a separate discussion about them in Parliament; they should not be automatically covered by the clause.

It is also right to provide for rapid developments in technology. We all know how fast it is moving and how difficult it is for most of us to keep up with the speed of progress. The clause may allow us to provide new defences, where appropriate, if there are changes in the way in which electronic distribution takes place. It also allows for amendments to ensure that loopholes are not created with new technology around publishing or distributing by electronic means.

My hon. Friend the Member for Rother Valley (Mr. Barron) is right: the proposals would have to come before Parliament. They would go through the affirmative procedure and there would be scope for discussion. We should need—and it would be right—to have detailed consultation on the proposals.

I am glad that officials are meeting with the ISPA. There has been a great deal of contact with ISPs and we have discussed some issues during the passage of the Bill, such as the enforcement mechanism. We have said that we are keen to talk to the ISPA about how to work together in order to make the mechanism most effective without imposing additional burdens on ISPs. That is sensible. It is good that they are meeting, but we are not aware of any concerns that they have raised that would change the course of the Bill or cause us to amend it further. It is right for the Government to have that power if they are to keep up with the pace of technology.

Question put and agreed to.

Clause 7 ordered to stand part of the Bill.

Clause 8 - Prohibition of free distributions

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 10, in page 3, line 38, leave out ``a'' and insert'' his''.

The amendments pertain to the common, historical provision of coupons. I should imagine that several members of the Committee can remember back to their childhood when football cards were issued with cigarettes. They never inspired me to smoke and I doubt that much of the coupon practice has an impact today. It was an historical part of British culture that coupons were issued with cigarettes; many people have valuable collections of football cards. Under the Bill as it is drafted, the issuing of cards will become a practice of the past and the cards themselves museum pieces. The amendments are designed to point out to the Government some of the consequences.

Amendment No. 10 has rightly been selected to stand on its own. It is separate from the issue of coupons per se, and relates to legitimate defences and what is or is not reasonable. I have never attended an event at which I witnessed tobacco products or coupons being given away, but I am not a smoker and would probably not have been aware of it.

Under the Bill

``A person is guilty of an offence if in the course of a business he—

(a) gives any product or coupon away to the public in the United Kingdom, or

(b) causes or permits that to happen''.

My anxiety in trying to change minutely the wording from ``a'' to ``his'' relates to the possibility that a person may attend an event over which he or she has little control and for which he or she has little responsibility. I thought that the proposed wording would be tighter and would make it clear that responsibility lay with the person carrying out the business. If the business or function were, for example, a big sports event, over which the individual found guilty of giving away coupons had no control, it would be difficult to prosecute if his instructions or the agreement on which the business was established contained a clause that made it clear that he could carry out his business at that event. The word ``a'' disconnects the person who will be found guilty of the offence from ownership or responsibility for that business.

Although I have never witnessed it, I understand that such products have traditionally been given out at sporting and even charitable events or large social gatherings and university balls. Sometimes students become involved in the distribution of such products as a way of augmenting their income to support themselves at university. Traditionally, it has been done in that way, but of course such a person would have no responsibility for that event and might walk into a bit of a hole if he did not realise that such activity was now illegal.

The amendment is a probing amendment designed to make it clear who has responsibility for the business. If the person found guilty of the offence had no responsibility for the business, he might innocently walk into committing an offence without realising what he was doing.

Yvette Cooper (Labour, Pontefract and Castleford)

The clause makes it clear that the person who is guilty of committing an offence in the course of a business is someone who gives out any product or coupons to the public or causes or permits that to happen. Such people have defences under clause 8(4) if they did not know, had no reason to suspect or could not have reasonably foreseen that that would be the effect. Appropriate defences are provided for people who were not aware that products or coupons were being distributed at an event that they had organised or were simply attending an event at which products or coupons were being given away. The people involved in giving away the products or coupons—those who had been paid to stand around and hand them out—are involved in the course of a business in giving away a product.

Under the amendment, the offence would relate to activity in the course not of ``a'' business but of ``his'' business. It would catch the owner of the company but no one else in the chain for devising and commissioning a free distribution to the person making the free distribution. That would unacceptably narrow the scope of the offence. There may be a case in which the owner of a business was overseas, and therefore, beyond United Kingdom jurisdiction. It would be unacceptable if the ban on free distributions did not apply to anyone else involved in the business who distributed free coupons or products and was clearly in breach of the intention behind the Bill. If that person did not own the business and the owner was abroad, we could do nothing to stop the free distribution. That would clearly be wrong and against the intentions of the Bill.

The defences are clearly set out and perfectly reasonable. They parallel defences set out earlier in the Bill. The amendment would narrow the scope of the offence too far and would rule out cases that we want to catch under the terms of the Bill.

Caroline Spelman (Conservative, Meriden)

The Minister's answer was glib, and shows what is wrong with the Bill. Having heard her explanation, I can see that at events such as I have attended, the Bill would not work brilliantly. For example, in corporate entertainment, gifts are often given to those invited. ``His'' and ``her'' presents are wrapped up and placed on the tables. In our household there is usually a problem because my husband gets the bouquet of flowers, perfume or a feminine gift, and I end up with the hip flask—we are a role reversal couple. It is usually assumed that Members of Parliament are men at such events. The gifts are handed out by those taking the coats or waiting on tables—casual labour—who may be students.

The rates of pay at such events for cloakroom assistants or waitresses are not fantastic. The young person hands out beautifully wrapped gifts, and the first person on the table who opens one ruins the surprise for everyone else, because then we all know what is inside the orange packet. The gift item may be a cigar case or a cigar. Perhaps the organisers think that the gentlemen on the table will want to smoke them after the meal.

At the point at which the present is opened, the casual employee suddenly discovers that the gift is a tobacco product, and being well versed in the law on tobacco advertising may become anxious. Should that person collect up the presents again lest they be found guilty of distributing them? The problem is not as easy and glib as the Minister thinks and will cause difficulty in practice. It is reasonable to trace the ultimate responsibility to the owner of the business. The owner may be abroad, as the Minister described, but if he is good at his job he will know what a business should and should not do. He is far more likely than the casual employee to know the minutiae of the Bill. Someone such as a managing director could be expected to be perfectly versed in the offences and defences set out in the Bill. The problem is not as easy as the Minister thinks, but I will not press the amendment.

Ian Bruce (Conservative, South Dorset)

It is normal practice when inviting people to dinner in the course of any business, not only tobacco businesses, that at the end of the meal, someone comes round and asks whether one would like a brandy. At the same time, free cigars are offered. Although it can be argued that the individual is not attempting to promote the tobacco industry generally, he is promoting the smoking of cigars. The first time that the majority of people smoke a cigar is when they are given a free one. I thought that the clause was simply in place to catch the tobacco industry, but it will catch every business man who offers cigars to a group of people around a table.

Caroline Spelman (Conservative, Meriden)

I am grateful to my hon. Friend. I had not thought of such an example. In those circumstances, business men could be thought of as promoting a tobacco product to their clients. Will the Minister clarify the position? I was about to withdraw the amendment, but I shall hold back from doing so until I have heard what she has to say. Such a serious problem illustrates our difficulty, in that we are talking in practical terms about changing the habits of a lifetime. Hitherto, it has been customary for people, particularly in the business community, to hand out tobacco products. Given that they may not be intimately versed in the details of the Bill, they may need considerable warning about what they may or may not do in respect of corporate entertainment and the provision of tobacco products. Will the Minister give us some guidance on that?

Yvette Cooper (Labour, Pontefract and Castleford)

The hon. Member for Meriden cited the example of someone who handed out a wrapped product and did not know what was inside the wrapping. That person clearly has a defence under clause 8(4). A person engaged in one-off helping at an event, even if he or she were paid, would be covered by the phrase ``in the course of a business''. It has a repetitive element to it and would involve an on-going process. However, I shall be happy to return to the matter later in our proceedings.

The hon. Member for South Dorset referred to the handing out of cigars at the end of a meal or as part of an entertainment. We want to stop the giving away of products or coupons for the purpose of promoting a tobacco product. We want to stop free gifts being handed out for the purpose of promoting tobacco products and encouraging people to buy them. Let us suppose that such a strategy includes making a big fuss about a particular cigar or cigarette; mention is made of how wonderful they are and details are given about where such products can be obtained—such as at the shop down the road for half price. That is a promotion strategy. However, if cigars are handed out at the end of a meal to those who want to smoke them, that process is not about the promotion or sale of tobacco products.

The purpose of the clause is clear. It is about stopping the promotion of tobacco products through free distribution, which will be undertaken unless we ensure that it cannot be. We know of many instances of free distribution in pubs, clubs and student union bars; they are about the promotion of tobacco products and trying to persuade students, for example, to smoke particular brands. There was a promotion of tobacco products at Hull university soon after no smoking day. We want to create an offence under the Bill and we are right to do so.

Ian Bruce (Conservative, South Dorset)

The clause is badly worded. We know what the Minister is going for; she is trying to say that it is an offence for a tobacco company to give away free tobacco products or anything to promote them. We understand that that is the purpose of the Bill, but the clause clearly catches someone providing free tobacco at the end of a meal, or indeed during the meal, in the pursuit of his business, to make the guests feel good about him. It may not be part of that individual's business to promote tobacco, but the activity does have the effect of promoting tobacco.

I ask the Minister to consider the situation of the Commons and Lords pipe and cigar smokers club. We assume that promotional activity within that club, which I think is done by the Tobacco Manufacturers Association will be illegal. The association provides free tobacco. Has the Minister considered the implications to freedom of access to Members of Parliament, and will she undertake to go away and consider that point to ensure that she is not catching people whom she does not intend to catch?

Caroline Spelman (Conservative, Meriden)

I am glad that we extended this debate a little, and I am grateful to the Minister for saying that she will go away and consider the wording ``in the course of a business'', because we raised genuine concerns. I am still not completely satisfied that the position of the casual employee, who may do waitressing and coat-taking plus distribution of corporate hospitality gifts on a weekly basis, is clear. As I explained, if wrapped gifts started to be distributed, it might be that a certain number of guests start unwrapping them and the employee would at that point realise, ``God forbid, it contains a tobacco product.'' If he is well versed in the law, he has to go to his supervisor and say, ``I'm really sorry, you know. I can't carry on doing what you've asked me to do this evening. I can't do this job and I'll have to pass up my earnings unless you can find me another task, because it's an offence for me to distribute this tobacco product.'' So we are not clear that we are protecting those who need properly to be protected while catching those who need properly to be called to account. The business community needs a warning. It is a very grey area.

If we asked some cigar lovers how they first started smoking cigars, we just might find people who said, ``I was offered a cigar at a corporate dinner and I didn't think it was the kind of thing I would enjoy smoking, but it has become one of my favourite habits.'' That is not beyond the realms of imagination. As to particular brands, businesses doing corporate entertaining are usually anxious to give guests a top-quality product, so quite possibly the gift would bear the brand name of one of the very best cigars. It remains a very grey area.

I said earlier that I would be willing to withdraw the amendment, and I am willing to do so if the Minister is willing to have another look at this. However, we must also keep repeating that, although Labour Members may try to raise themselves up as the champions of public health and put the Opposition down as not being so, that is factually not true. We share exactly the same objective of reducing smoking prevalence in this country, and that has been said on numerous occasions. Our objective is perfectly clear, but we try also to bring a degree of fairness and common sense to the Bill's drafting. It is certainly part of the Opposition's role to protect innocent people who are caught by the definition of an offence under the Bill. I still think that the clause is unclear, but I am willing to withdraw the amendment if the Minister will look again at its wording.

12.30 pm

Yvette Cooper (Labour, Pontefract and Castleford)

I welcome the hon. Lady's decision to withdraw the amendment. I want to add two quick points of clarification. It is not my understanding that the situations that she has described would be caught by the Bill, but I will look again at the phrasing. However, the wording in her amendment is not acceptable, because it would not allow the foreign owner to be prosecuted or anyone else to be held responsible for what we have described.

As for the Lords and Commons pipe and cigar smokers club, the idea that anything in the Bill would prevent access to Members of Parliament is nonsense. Any tobacco company can gain access to Members of Parliament, talk to them as much as individual Members will let them, and can make their points as they have always been able to. I was not sure whether the hon. Member for South Dorset was suggesting that there should be a special exemption for hon. Members so that companies could offer them free products and coupons that were not available to other members of the public. That would probably be a little unacceptable.

Kevin Barron (Labour, Rother Valley)

I remind my hon. Friend that the Lords and Commons pipe and cigar smokers club is not an all-party group. [Hon. Members: ``It is!''] It is not; it is denied to most hon. Members. It is a front for the Tobacco Manufacturers' Association, set up to influence legislators.

Yvette Cooper (Labour, Pontefract and Castleford)

I was not aware of that. I hope that, if the tobacco companies engage heavily in providing free promotional goods and coupons, that is declared in the Register of Members' Interests, as appropriate. There can be no justification for treating Members of Parliament differently. Clearly, the Government do not want to permit the promotion of tobacco by means of free products and coupons.

The hon. Member for Meriden said that Conservative Members were just as concerned as the Government are about public health. I accept that many of her amendments have been constructive, and that we have had a helpful discussion on many of the issues. I remind her, however, that the Conservative party voted against Second Reading of the Bill and rejected a ban on tobacco advertising on principle. So to get on her high horse about public health is not appropriate. [Interruption.]

Humfrey Malins (Conservative, Woking)

Order. The Committee is becoming just a little too noisy for my taste.

Caroline Spelman (Conservative, Meriden)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 11, in page 3, line 39, after `any', insert `tobacco'.

Humfrey Malins (Conservative, Woking)

With this it will be convenient to take the following amendments: No. 12, in page 4, line 15, leave out from `a' to end of line 16 and insert `tobacco product'.

No. 13, in page 4, line 18, after `making', insert `tobacco'.

Caroline Spelman (Conservative, Meriden)

The amendments deal with the main body of the subject of coupons, but I cannot let the Minister get away with her last remarks. She knows well how reasoned amendments work on Second Reading and there was an objection in principle to a ban on tobacco advertising. We said at the start of our deliberations that none of the measures would be effective while smuggled tobacco products came in through the floodgates.

The amendments focus on the coupon system in relation to the supply of tobacco products. They pick up on an issue that was raised legitimately on Second Reading by my hon. Friend the Member for Ryedale (Mr. Greenway) and are designed to warn the Government of the potential adverse consequences of the Bill as it is crafted at the moment. I hope that the Government have thought them through.

In our view, tobacco companies that give away products that are not tobacco products or coupons for non-tobacco products should not necessarily be penalised. Many tobacco companies give away coupons to existing customers when they buy tobacco products, which they can then collect and exchange for high-quality items such as limited edition prints, photographs or tobacco accessories. Coupons can be used for silver cigar boxes, which may or may not bear the name of a cigarette or other tobacco product.

I related earlier the historical practice of children collecting football coupons. That did not give rise to children smoking tobacco; usually an adult gave the football coupons to children, or sometimes kept them themselves, because cards about successful footballers of the day became desirable to collect. It is not common sense to say that non-smokers, especially children, are encouraged to take up smoking because when they buy a packet of cigarettes they get a coupon for a bone china mug or a set of free wine glasses. That is not realistic. It is not what happens in practice.

As my hon. Friend the Member for Ryedale pointed out, the loss of coupons for non-tobacco products will have an impact on the industries that produce those non-tobacco products. It seems to me that the Government have a remarkably deaf ear to manufacturing. That is certainly the view in my constituency in the west midlands. The Government seem to believe that if one cannot make a profit in manufacturing one must get out of it and into something else. However, that is a difficult transition to make if one is a bone china manufacturer in the Potteries. The clause will have an impact on manufacturers of non-tobacco products, which are already suffering significant difficulties.

Kevin Barron (Labour, Rother Valley)

Does the hon. Lady think that the promotion of other products through coupons in cigarette packets should not be covered by the Bill at all?

Caroline Spelman (Conservative, Meriden)

I question whether the Bill is going too far. It will cover a range of non-tobacco items that do not promote tobacco smoking directly. The motivation for younger people to smoke is that they like to look cool. They give in to peer pressure; everyone is doing it, and they like to have a branded product that looks fashionable. That has nothing whatever to do with collecting a bone china mug.

Mr. Barron rose—

Caroline Spelman (Conservative, Meriden)

I think that the hon. Gentleman has made his point.

The purpose of the amendment is to distinguish between coupons for tobacco products and non-tobacco products.

Amendments Nos. 12 and 13 would make the distinction between coupons for tobacco products—about which we agree with the Government, although we want to discuss the value of those products later—and other products that have nothing whatever to do with tobacco, which it is unnecessarily draconian to include in the remit of the Bill.

Mr. Barron indicated dissent.

Caroline Spelman (Conservative, Meriden)

The hon. Gentleman obviously does not agree. He thinks that it is perfectly acceptable to shut down an outlet for manufacturers' products. He is happy to see that happen. He will make his own speech on the matter if he feels strongly about it.

Kevin Barron (Labour, Rother Valley)

I shall speak against the amendments. I wanted to intervene to say that the coupons that the hon. Lady describes are covered by the voluntary codes. Indeed, there is a lot of restriction on what can and cannot be advertised via coupons. They are a form of direct mail that promotes cigarettes in many homes up and down this country. That is well evidenced by companies having their activities restricted by the appropriate authority. Clearly, the amendments would be a way of circumventing the intention behind the Bill.

Everyone thinks that such provisions are not well thought out. However, coupons have an important impact, especially in areas where there is a high incidence of smoking. The Committee should consider what the tobacco industry itself says. I have in front of me an analysis of internal documents from the tobacco industry's main UK advertising agencies. Evidence submitted to the Health Committee by CDP, one of the five main advertisers in this country, on the Kensitas club gift scheme included a Gallaher creative brief dated 5 November 1999. It states:

``Who are we talking to:

Glasgow's smokers—they smoke because they enjoy it. They also love the gift scheme with over 50 per cent of the Club franchise unemployed this probably explains its popularity.''

They deliberately target the high incidence of smokers among poor people in this country. They know that they get people hooked on tobacco and coupons. It is unbelievable that that is not a part of the culture of the homes to which such material is sent. That culture affects not only adults who smoke. Such material lies around for children and everyone else in the household to read.

David Taylor (Labour/Co-operative, North West Leicestershire)

Does my hon. Friend agree that after hearing today's debate it would be a good idea to announce the formation of a parliamentary group called ``Conservatives for carcinogens''?

Kevin Barron (Labour, Rother Valley)

Perhaps I am not the person to answer that question. As I said on Second Reading, I have always felt that there has been a link between the purveyors of such products and the Conservative party for far too long—an unhealthy link in terms of the public's health. The amendments designed by Opposition Members could easily have been designed by people who use such coupons to promote tobacco in this country, and I hope that the Committee will have none of them.

Ian Bruce (Conservative, South Dorset)

I shall speak later on clause stand part, as I do not want to speak incorrectly to the amendments. However, now is the appropriate time to tell the Minister that I understand where she and the hon. Member for Rother Valley are coming from. Coupons relating to cigarette products are designed to get people hooked on collecting coupons as well as to continue smoking. I have no argument with the Government on that. Those are my bona fides on the matter. However, the clause is, like all the rest of the clauses, incredibly badly worded.

Under the clause, buying petrol and a pack of 20 cigarettes at a Fina petrol station will make the Fina loyalty card that I have here illegal. That card allows people to save up and receive a token from the promoter of petrol, although that promoter also sells tobacco and no doubt makes a great deal of profit from the tobacco sold through its garages. That coupon can be spent in other shops such as W.H. Smith and Woolworths, among others. The clause will catch such activity.

People who go to Tesco to buy their groceries and cigarettes receive a discount coupon that eventually allows them to buy anything. It would be fairly simple for the Government to approach the matter again on a voluntary basis or, perhaps, through legislation to make it clear to such people that a coupon given out under such loyalty schemes could not be used to buy tobacco products. That might be a simple way to deal with the matter. However, under the Bill as it stands, by not specifying tobacco products, we leave such loyalty schemes open to being dealt with in that way.

I have an Egg card. If I buy anything on line, I receive a 2 per cent. discount. I could be buying tobacco on line, not that Egg has anything to do with the tobacco industry, but people can receive, for example, 1 per cent. discount on items because they have used their credit card. The catch-all clause will catch ordinary loyalty schemes. I see some extraordinary looks on the faces of the advisers to the hon. Lady. After 1 o'clock, she should have a firm word with them because she has been led down the garden path into doing things that she did not intend to do.

Yvette Cooper (Labour, Pontefract and Castleford)

The purpose of the clause is to stop the giving away of products or coupons when the effect of such action is to promote tobacco products. The hon. Member for South Dorset expressed his worry about loyalty cards such as Egg. Such cards are promoting his spending. Companies want him to spend money. If they do not specifically promote tobacco products, they are not covered under the Bill. The Bill will catch the giving away of products or coupons, the purpose or effect of which is to promote a tobacco product.

The Opposition's amendments would focus the clause on the giving away of tobacco products or coupons that are redeemable for tobacco. A packet of cigarettes may contain a coupon that can be redeemed for petrol, watches or a pop-up toaster. The current Marlboro offer states:

``Just send us three Marlboro Menthol Lights pack tops and we'll send you this lighter—absolutely free!''.

It is often a standard approach to give away coupons that are redeemable for products other than tobacco. I accept that some coupons are aimed at those who do not smoke because they are available only in packets of cigarettes, but they are clearly an incentive for people to carry on smoking and buying that particular brand.

Part of the Bill is aimed at new smokers, young people and those who may not otherwise start smoking. It is aimed also at those who want to give up smoking. We know that 70 per cent. of smokers say that they want to give up. They may be trying to give up, but being bombarded with advertising that provides an incentive for them not to give up. That is why we are worried about the giving away of other products, whatever they may be. If coupons or products—even if they are not tobacco products—provide an incentive to keep smoking and buying tobacco products—it is right that they are covered under the Bill.

Ian Bruce (Conservative, South Dorset)

I direct the Minister's attention to subsection (2), which states:

``It does not matter whether the product or coupon accompanies something else, or is given away separately.''

Subsection (5) states:

```Coupon' means a document or other thing which (whether by itself or not) can be redeemed for a product or service or for cash or any other benefit.''

Such measures clearly catch people who purchase their tobacco products, use a loyalty card and receive a benefit in kind later. For the Minister to say that using a loyalty card is not helping the tobacco industry to promote its products, as all products have been promoted by loyalty cards, ignores the advice that she gave to the Committee about how people use such schemes. What is wrong in a person having 20 extra points on his card as a result of the purchase of a packet of cigarettes if that is not covered by the clause?

Yvette Cooper (Labour, Pontefract and Castleford)

The clause makes it perfectly clear. If the purpose or effect is to promote a tobacco product, then it is covered. If something promotes spending on anything at all, then it promotes spending. Our concern is schemes the purpose or effect of which is to promote a tobacco product or to promote smoking. The clause seems to me to be relatively clear. I am happy to take further legal advice on the issue and get it clarified, but I struggle to understand why there should be a problem.

There is a legitimate issue here that we should be concerned about, which is the promotion of free non-tobacco products to promote tobacco products. That is what the amendments address, and that is what we are right to reject, because it would be wrong to create a loophole that would allow free products or gifts to be used to promote tobacco products, and to narrow the Bill to promotional tobacco products alone. That is why we reject the amendments.

Caroline Spelman (Conservative, Meriden)

I give credit to my hon. Friend the Member for South Dorset; I had not spotted the potential problem. Loyalty cards could be caught under subsection (5) because ``document or other thing'' is a wide definition. I am pleased that the Minister will have another look at that; it is important that we get it right, since loyalty cards are on the increase, people use them and there is no question but that people do redeem them for, among other things, tobacco products.

I listened carefully to the Minister, and to make it perfectly clear, of course we are interested in helping those who want to give up smoking. The majority of smokers in some parts of the country—I think that it is as high as 60 per cent.—have tried to give up, and the amendments are in no way intended to undermine their resolve. It is a moot point whether the provision of non-tobacco products really increases smoking prevalence; sometimes there is a limit, quite frankly, to how many bone china mugs or other such products people actually want cluttering up their cupboard. I have never in my life heard anybody say to me or to a fellow smoker, ``Oh, please smoke a few more, because I am trying to get another one of those bone china mugs.'' We have to bring a degree of common sense—

David Taylor (Labour/Co-operative, North West Leicestershire)

Will the hon. Lady give way?

Caroline Spelman (Conservative, Meriden)

No, I am not prepared to way to the hon. Gentleman, who rudely described my party as interested in favouring carcinogens. That has not disposed me towards taking interventions that I might otherwise have considered. The hon. Gentleman's comment was outrageous, and he will just have to wait until I feel better about it. It is wrong and quite unnecessary to lower the tone of the Committee in that way.

In the interests of protecting those who are trying to give up, if there is any question that non-tobacco products make it more difficult to give up, I am prepared to be sympathetic to that argument. That is an important point, but common sense tells me that that is not the way in which smoking appeals to younger children. It is unlikely that a child will get sufficiently organised to fill out the sort of Marlboro coupon that the Minister described, find the stamp and send it off. I know too well from my own children that filling in forms and posting them off usually falls to me.

So I do not think that young smokers are drawn in by such activities. However, we are concerned for those who have been smoking for a long time and want to give up. In deference to them, if there is any doubt that such promotions could make it more difficult to give up—although I think that the fundamental addictive quality of the product is the reason why they find it so hard to give up—I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 37, in page 4, line 16, at end insert—

`(5A) For the avoidance of doubt a ``coupon'' within the meaning of this section does not include a voucher issued to a customer who has previously bought tobacco products which have been found to be defective or unsatisfactory in some way, where the coupon is issued to the customer by way of compensation to allow him to obtain further products of the same nature.'.

Humfrey Malins (Conservative, Woking)

With this, we may take amendment No. 38, in page 4, line 18, leave out `for a nominal sum' and insert

`for a sum less than their market value or, in the case of coupons, the market value of the products for which the coupons can be exchanged'.

Caroline Spelman (Conservative, Meriden)

The amendments raise two separate issues in relation to coupons for use against the purchase of other tobacco products. There are two dimensions to the amendments. They are probing amendments, designed to make the Government think about some of the consequences of the way in which the clause is drafted. Amendment No. 37 would make it clear that the consumer has a degree of protection for a faulty product. The prohibition of coupons could place at risk the practice of sending out vouchers that are exchangeable for goods after a customer has returned a faulty product. It is not beyond the realms of imagination for a packet of cigarettes to be incomplete, wrongly wrapped, unusable or unpalatable; the consumer might find that they are wet or faulty and wish to return them. As phrased, the clause could deprive a consumer of a perfectly legitimate request. If the Government do not accept the amendment, they must confirm that our interpretation is not correct. At present, the practice takes place and we need to be sure that consumers have a fair degree of protection.

Amendment No. 38 is designed to probe the Government on the wording ``for a nominal sum''. It is designed to be helpful. Clause 8(6) is vague; the amendment would make it clearer by inserting:

``for a sum less than their market value or, in the case of coupons, the market value of the products for which the coupons can be exchanged''.

``Nominal'' suggests ``very small'', whereas the relevant criterion is whether the coupons allow purchase at less than market price. The amendment attempts to pre-empt the possibility of avoidance, by precluding coupons that allow the purchase of a packet of cigarettes for 1p. It is logical, however, to increase the coupon value to allow the purchase of a pack of 200 cigarettes for, say, £10. The Minister will agree that £10 is not a nominal sum. At present, we are concerned that there is a loophole in the vague phrase ``a nominal sum''.

Yvette Cooper (Labour, Pontefract and Castleford)

I am sympathetic to the intention behind amendment No. 37, but I feel that it is unnecessary. If the coupon represents full compensation for the faulty goods, it will not be caught by the Bill. Clause 8 deals only with coupons that promote tobacco products and although I am sympathetic to the aim of amendment No. 37, it is unnecessary. Clearly, there is no intention in the Bill—nor any powers—to affect consumers' statutory rights.

Amendment No. 38 is important and raises concern about the Bill as it is drafted. The problem with the phrase that Conservative Members have used to meet the concept of market value is that the phrase ``less than their market value'' raises difficult questions about how market value is defined. The Bill should not prevent legitimate competition by reducing prices. That would be an unfair restriction. ``Market value'' is probably drawn too tightly and would not allow the ordinary competitive practices within a market. I accept, however, the hon. Lady's concern about the definition of ``nominal sum'' and how to interpret it to include the example that she cited of a product that is dramatically discounted.

We are keen to reconsider the issue raised in amendment No. 38 to find a more appropriate wording than ``nominal sum'', although I caution the Committee that there is not necessarily an easy answer that would allow us to encompass all the abuses that cause us concern.

Caroline Spelman (Conservative, Meriden)

I am encouraged by what the Minister has said. It is on the record that coupons that have the effect of making a product complimentary are not caught by the Bill.

Yvette Cooper (Labour, Pontefract and Castleford)

Compensatory.

Caroline Spelman (Conservative, Meriden)

Yes, compensatory. That helps to clarify the matter, and we do not need to press the amendment to a vote.

I am delighted to hear that the Minister will reconsider amendment No. 38. Examples in the guidance may help to clarify it. The Minister understands the spirit in which it was tabled and we share the same objective. With that assurance, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

It being One o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till this day at half-past Four o'clock.

Standing Committee A

Clause 8 - Prohibition of Free Distributions

Caroline Spelman (Conservative, Meriden)

I want to discuss the general points of the clause that were not brought out by the amendments. As in previous clauses, clause 8, in subsections (6) and (7), allows the Secretary of State to determine through regulations the large part of the Bill that refers to coupons. We discussed earlier how difficult that would be for those who must work with the Bill, because we are, at best, handing over an empty box into which the Government can place the regulations.

I want to impress on the Minister the need to assist those who must work with the Bill with clear guidance about what is meant by coupons, given that we accept that doing away with coupons is a done deal. We argued that the phrase ``nominal sum'' was too vague, and the Minister agreed to look for another form of words. I hope that she will accept that producers of tobacco products should not be expected to go to court to determine what the law is in this area. The guidance must be clear, and if the Bill is insufficiently clear or could create a loophole, we need to find an alternative form of words.

I hope that the Minister has had time to consult with her civil servants so that she may respond to the legitimate inquiries of my hon. Friend the Member for South Dorset (Mr. Bruce) about loyalty cards. The more I thought about that point, the more important it seemed that we should not leave it to hang in the air. There is probably an easy explanation, but it is an important question, and I look forward to hearing the Minister's comments.

Kevin Barron (Labour, Rother Valley)

I would not say that the hon. Lady misled the Committee about coupons this morning, but Staffordshire pottery is not the only thing that people can get from the tobacco companies. I thought that I should intervene to say exactly how coupon promotions come into the public domain. I have a Gratis catalogue that was published by Benson and Hedges in 1996. Complaints were made about it to the Advertising Standards Authority, or to the subdivision of the ASA that dealt with cigarettes at the time. It advertises many things, including children's skateboards, helmets, toys and garden tools. Other brands even offer international flights.

Those promotions are not just little knick-knacks for people to put on their sideboards. Coupons are big business, as the hon. Member for Ryedale (Mr. Greenway) pointed out on Second Reading. People may assume that they are simply

a bonus that people get for smoking cigarettes and that it is not connected with anything else to do with cigarettes, such as their promotion. It is clear that if people are collecting vouchers, they will stick with a brand, because that is how they get the coupons for children's toys, or whatever. There are no iron lungs in the catalogues, but there are other things that they might find useful at some stage.

Some evidence on smoking was published in a report by the Select Committee on Health last June. A qualitative research summary report—``Brand equity check for Benson & Hedges in conjunction with exploration of the Gratis catalogue loyalty scheme''—was prepared for Gallaher by Colquhoun Associates in June 1996, around the time of the objections to the Gratis catalogue on the grounds of what people believed it promoted. Colquhoun Associates looked at the effect of the Gratis catalogue scheme and how it operated at the time. The Select Committee report, appendix 26, says:

``Benson & Hedges sponsorship of Formula One is entirely coherent with expectations and offers the brand many opportunities to capitalise on positive associations. For instance, by sponsoring Formula One respondents claimed it made them believe that Benson & Hedges was a big, major league, very powerful brand with plenty of money. It also lent associations to the brand with young, fast, racy, adult, exciting, aspirational but attainable environments. It was coherent with all that respondents knew of the brand but also extended associative territory to make the brand more youthful, more dynamic and more exciting.''

The point is that coupons are not just about getting something back for smoking a particular brand. They aid to the promotion of cigarettes, and clearly lead to wider identification. The difficulty that faces the Committee is how to pull apart advertising and promotion, which are interlinked as they sell positive images about tobacco in our society. That interconnection has been identified in different reports over many years. We must recognise that the coupon scheme, in part defended by the Opposition at one of our earlier sittings, is nothing more than the promotion of cigarettes.

Ian Bruce (Conservative, South Dorset)

I agree that we should not have the specific coupon to which the Government refer. What I pointed out, however, was that ordinary loyalty cards are caught by the clause. Is the hon. Gentleman happy about that, and will he make sure that the loophole that ordinary loyalty cards currently enjoy is not left open for tobacco companies to exploit?

Kevin Barron (Labour, Rother Valley)

The hon. Gentleman is the only Committee member up to now who claims that ordinary loyalty cards will be trapped by the legislation. He clearly knows better than the parliamentary draftsmen and lawyers who have written the legislation: perhaps he is in the wrong job. The Bill is directly targeted at stopping the Gratis catalogue and other methods of promotion, not just by Benson and Hedges, but by many other tobacco companies. Those methods provide more than just little teapots for the sideboard: they do a lot to promote unhealthy tobacco in our society. The Government have recognised that, and I am pleased to support the clause.

Ian Bruce (Conservative, South Dorset)

It is incumbent on critics of a clause or part of a Bill to try to help Ministers, and I hope that the Minister will feel that I am helping her. I pointed out earlier just how faulty the clause is, because it catches something that the Government do not intend to catch.

I may be able to help the Minister with a little story about my own office when I started up a company for myself in Yorkshire. It was an employment agency, and at the time in question about six people were working for me. Three were occasional smokers, and three were not. We were based in an office about an eighth of the size of this room, with a fairly low ceiling. The non-smokers were somewhat upset about the amount of smoke coming into our lungs.

I observed what happened first thing in the morning when my staff arrived. There was always an uncomfortable shuffling, then one young lady working for me would offer the other two young ladies a cigarette. Each would remember from the day before when it was her turn to offer, and each felt a social obligation to do so, as they would if they were treating in a pub. Once they had smoked those cigarettes, the next person in line would think, even if she did not really fancy a cigarette, that the others might want one, and would offer her cigarettes round.

That example of giving a cigarette to someone else—and the Bill would not catch this situation, since my employees were not part and parcel of the tobacco trade—provides a big illustration of how giving away free cigarettes is a promotion of cigarettes. There cannot be a cigarette paper between the two sides of the Committee on that. In my office, the six of us sat down to discuss how to reduce smoking in the office. We made a very simple rule, which everyone agreed to. Quite simply, no-one offered anyone else a cigarette. Almost instantaneously, cigarette consumption went down to a quarter of what it had been before, and one of the people gave up smoking.

I do not argue that someone in business who invites people to dinner should not give them free cigars at the end, even if that person has nothing to do with the tobacco industry. The Minister might say, ``That bloke Bruce is on to something. Maybe he does understand that there is a route here to reducing peoples' consumption of cigarettes.'' That, after all, is what we intend to do, and someone who works in the tobacco industry tells me that if he offered someone a cigarette in a normal social environment, he would be caught by the clause. He said that to advertise is simply to refer to something, and to give something away is simply a means of doing that.

The Minister might consider what she means to do, because the clause creates a rather strange situation. The Minister says that the Bill does not do what I suggest that it does, but at the same time she tries to say that the Conservatives are against reducing the amount of tobacco being smoked. In fact, I certainly want people to reduce their consumption of tobacco.

Ernie Ross (Labour, Dundee West)

It seems to me that every time the hon. Gentleman stands up, he contradicts himself. In the scenario that he has just outlined, the individuals who had bought the cigarettes gave them freely to each other. There was no gift involved, because they each bought the same number of cigarettes. The hon. Gentleman has merely demonstrated that my hon. Friend the Minister is the right person to be answering for the Government, because the Bill deals with a health issue. When the hon. Gentleman, as the employer responsible for the group, got the six people together, they realised the damage they were doing to each other's health, and stopped smoking.

Ian Bruce (Conservative, South Dorset)

I am not sure that the Committee is any further enlightened by my giving way to the hon. Gentleman. Perhaps he would like to make a speech himself about how he believes that the clause will help matters.

Opposition Members are telling the Minister that the clause catches things that she does not intend to catch. Perhaps that will be a good thing, but people ought to know what they are being prevented from doing. The use of loyalty cards is clearly caught, and if the Government do not intend that, I urge the Minister to produce an amendment. She could say that retailers such as W H Smith that provide £5 coupons through a loyalty system could simply print, ``This coupon cannot be exchanged for tobacco.'' Using coupons to buy tobacco products is clearly one of the things that the hon. Member for Dundee, West (Mr. Ross) is trying to avoid happening. I accept that the connection between receiving a gift and the purchase of tobacco would be a good link to break.

The tobacco industry understands that link, and that is a legitimate concern of the Government. If a father is smoking cigarettes and his child receives toys from the loyalty card, the link may suggest to the child that it is good if the father keeps smoking cigarettes rather than his worrying that if his father continues to smoke and dies, the child will have no money. That is a serious point, which the Government must examine carefully if they are to make sure that the Bill is properly drafted.

Yvette Cooper (Labour, Pontefract and Castleford)

I will try to respond to some of the points that have been raised on the clause, although we may also have discussed them during our debates on the amendments. We will examine the wording around ``nominal sum'' but subsection (6)—as part of clause 8, which sets up the regulation-making powers—is important. We are not aware of products and coupons being sold for a nominal sum at the moment, but that would be an obvious and easy way to get around a ban on free distributions. It is for exactly that reason, that we are keen to make sure that we do have a regulation- making power in this area, as we want to prevent future abuses and manoeuvring by the tobacco industry to get around what would otherwise be a ban on free distributions.

The hon. Member for South Dorset again made a point about credit cards and loyalty cards, and the position is as I set it out earlier. A credit card would not be covered, because a credit card is not a coupon. Nor, in itself, is a loyalty card. The points accumulated on a loyalty card could be interpreted as coupons, because they are redeemable—the loyalty card is not redeemable, but the points may be. The distinction that I made earlier, still applies: the key question is whether the purpose or effect of giving away the product or coupon is to promote a tobacco product? If one receives double points on a loyalty card for buying cigarettes, rather than anything else at Sainsbury's, where particular benefits may apply to the loyalty card, that would provide a specific incentive to buy tobacco products. A particular promotion of tobacco products would be caught by the Bill. If there were a more general incentive to spend more money, in the broader sense, that did not particularly promote tobacco products, then it would not be covered by the Bill. The test is whether or not cigarettes or tobacco products are promoted.

I want to clarify our earlier discussion about students, casual workers and others in corporate marquees who have signed on for the day. The phrase,

``in the course of a business''

is intended to refer to an ongoing concern. However, while people are involved in a business, even if temporarily employed, they are covered by the Act. If a student hands out cigars or cigarettes because he or she feels like it, that is clearly not part of a business and is not done in the course of business. However, if students are paid to do so, or if they are taken on for a day as casual labour, they will, unless they have a defence, be caught by the Act. If they knew what they were doing, then they are potentially guilty of an offence. If they did not know, and could not have foreseen, they would have a defence.

It is not likely to be standard practice to prosecute the most junior member of a company, but the principle set out in clauses 2 and 3 applies equally here. The Bill includes everyone involved in a chain. If those people know about and are involved in promoting or distributing the tobacco product—or, as in this case, in distributing coupons—and do not have the defence of having been unable to foresee its effect, they may be guilty of an offence. The standard that applies in the clause is the same as that applied in earlier clauses.

Caroline Spelman (Conservative, Meriden)

I am glad that the Minister has returned to that point, which was left unclear at this morning's sitting. Her explanation is helpful. Does she accept that a group that we have not hitherto thought of alerting to the need to take a fresh look at the matter is the broadcasting corporate entertaining business—which I suspect will not be intimately versed in the details of the Tobacco Advertising Bill, which it would not regard as its core business?

Yvette Cooper (Labour, Pontefract and Castleford)

The key issue is whether a tobacco product is being promoted.

I shall clarify the question of cigars circulating at a dinner party. If a private business man hands out cigars that are paid for as part of corporate entertainment, with a purpose of persuading customers to buy, for example, computer software, but with neither the purpose nor the effect of promoting a tobacco product, that clearly constitutes a defence. The inability to foresee that an action would promote a tobacco product would also constitute a defence. However, the Bill covers a tobacco company that hands out free cigars and cigarettes in order to promote a tobacco product or a company that pays another company to distribute free tobacco products in order to promote a tobacco product, whether they are being promoted to Members of Parliament or to customers at an event.

The purpose of the clause is to tackle free distributions of cigarettes—perhaps to students—toys, teapots and other goodies used to promote tobacco products. That is the crunch question: the Bill seeks to prevent the use of free distributions as alternative methods of marketing and promoting cigarettes and smoking. That is the health aim that we are trying to achieve.

Question put and agreed to.

Clause 8 ordered to stand part of the Bill.

Clause 9 - Prohibition of Sponsorship

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 39, in page 4, line 24, leave out `or effect'.

Humfrey Malins (Conservative, Woking)

With this it will be convenient to take amendment No. 41, in page 4, line 39, at end insert—

`(c) that the purpose of what was done was to promote a tobacco product outside the United Kingdom and that the promotion of the product in the United Kingdom was incidental to that purpose and occurred only as a result of the broadcasting or publication by a third party of something in the United Kingdom for a purpose other than the promotion of a tobacco product.'.

Caroline Spelman (Conservative, Meriden)

We move to a completely different subject, which we discussed only briefly on Second Reading. The problem with the clause—it is a problem that we have encountered before in the Bill—is that it does not give us a clear definition, in this case of sponsorship. A lack of clear definition may cause confusion. The word is used in many different contexts. Hon. Members use it in a parliamentary context when we talk about sponsoring a Bill: indeed, I received a good response from hon. Members on both sides when I sought sponsors for my private Member's Bill on adoption.

Sponsorship can be used to describe support for an activity, event or organisation in return for something—or not as the case may be. I do not expect anything from hon. Members in return for sponsoring my Bill, except, perhaps, that they may be present on Second Reading. Sponsorship can, but does not necessarily, give rise to an agreement—again, I have no formal agreement with the hon. Members who supported my Bill. The clause is framed in terms of a sponsorship agreement, in which a party to it makes a contribution towards something. That is one definition of sponsorship but it may not cover all aspects of sponsorship. When an agreement is struck the parties usually know what they have agreed to do under that agreement, and that is often, thought not always, confirmed in writing. Under the definition of the sponsorship agreement given in the Bill, it is not clear where any written agreement is needed. That could open a considerable loophole.

As far as I can tell, nothing in the Bill will successfully tackle the problem of product placement. Clearly when a film star is asked by a tobacco company to smoke in a film, there may be some form of agreement, but if there is no requirement for that agreement to be in writing, so that it can be confirmed or proven to exist—if, in short, the agreement is verbal—the Bill will open quite a loophole. There is no question that product placement of that kind in films has a big impact on the group that all parties seek to protect—young people. Far more effectively than coupons, bone china mugs and all the other things described earlier, visual images of young peoples' role models who are smoking has a very great impact indeed.

I am not convinced that the Government's drafted version of a sponsorship agreement is really logical. People usually know their purpose or whether they are party to an agreement, but they cannot necessarily know the results of entering into an agreement. As drafted, clause 9(1) would create an offence arising out of a result, and that is a difficult concept. I imagine that when a sponsorship agreement is struck between two parties, whether in writing or not, what is in it for the parties concerned is very much left at face value. The full effect of his or her sponsorship may not be spelled out to the individual concerned. In consequence, perhaps, without seeing the detail of the agreement, it may be difficult to judge whether that person should have known what the effect of that sponsorship agreement would be.

Ernie Ross (Labour, Dundee West)

Following the scandals that have surrounded all types of sponsorship, sports stars and media personalities are not stupid. If they are signing a sponsorship agreement, they have lawyers and agents advising them. They must go into the small print of an agreement, and they must be quite clear about what they are sponsoring. The most recent example in which people discovered that they were sponsoring something that was not acceptable was the manufacture of balls used in football matches. Someone discovered that Adidas was using cheap child labour. Agents are conscious of these things. Surely it is the responsibility of the person who signs the sponsorship to find out what is entailed. That is the Government's responsibility.

Caroline Spelman (Conservative, Meriden)

The hon. Gentleman's argument is predicated on the fact that something was signed, but it may not always have been signed, since the Bill contains no requirement that it should be. An agreement could be purely verbal. In such a case, it could be very unclear—and very difficult to prove in a court of law what was actually said as part of that agreement.

My desire is entirely to help the Government. I see a big loophole, and I would be the first to say that when all conventional methods of advertising are shut down, product placement remains an important instrument. As far as I can see, at the moment, we have very little control in this country. Many films are produced out of the United Kingdom. Some of the greatest blockbusters are produced in Hollywood, and are not governed by constraint of the type in the Bill, but they are shown in British cinemas up and down the land and contain strong subliminal images about tobacco and tobacco products.

We are often consumed as we look at the Tom Cruise and Nicole Kidman characters—and I was sorry to hear today that they are splitting up. Non-smokers are less affected, but it is sometimes possible to watch a film all over again from the perspective of product placement, and it is extraordinary how often a big poster pops up as a backdrop to the superstars. Did they know that they would find themselves standing in front of a socking great advertisement for branded cigarettes? We do not know. Was it part of their agreement to stand in front of it? It is all very unclear and ill-defined. We want to help the Government to deal with this major loophole. There is no doubt that advertising can have a big impact on the young, who are highly susceptible to it. As drafted, however, I doubt whether the clause will be effective in practice.

Amendment No. 39 is coupled with amendment No. 41, which deals with a different problem. It is designed to strike a balance on what is achievable in terms of constraining advertising through sponsorship agreements. Under clause 9(1):

``A person who is party to a sponsorship agreement is guilty of an offence''

if the purpose or effect of the sponsorship

``is to promote a tobacco product in the United Kingdom.''

That much is clear. What happens, though, when Bernie Ecclestone is sitting in his London headquarters agreeing to a deal with Marlboro to sponsor the Monaco grand prix? If photographs from that meeting appeared in United Kingdom magazines, would it be an offence under the clause? The new subsection makes it clear that sponsorship deals negotiated in the United Kingdom that do not relate to UK events are not covered by the rule when the photographs are incidental and not expressly published for the purpose of tobacco promotion.

Surely the Government do not want to drive international businesses out of the country for fear of accidentally committing this offence in connection with overseas events broadcast in the UK. Amendment No. 41 would prevent that. Formula 1 is international business and there is no getting away from it. There are 16 races in the year and if tobacco is to be banned only in this country, its impact on the image transfer from Formula 1 to tobacco—I accept the analysis that links them, particularly with respect to the young—will, frankly, be minimal. That the glamorous image of sport transfers to tobacco products is proven by market research, but—

David Taylor (Labour/Co-operative, North West Leicestershire)

Will the hon. Lady give way?

Caroline Spelman (Conservative, Meriden)

No, I have just about finished.

One ban among 16 will have little impact. The amendment is a practical proposal and I hope that the Minister will accept it.

Yvette Cooper (Labour, Pontefract and Castleford)

The hon. Lady said that amendment No. 39 was about closing the loophole with respect to product placement in films. However, the amendment would broaden sponsorship and could create a loophole because, while the effect might be to promote a tobacco product, companies could argue that their purpose was rather to sponsor an event. If the effect is clearly to promote a tobacco product, companies should not be allowed to use that argument. That is why clause 9(1) refers to ``purpose or effect''.

Product placement in films and television programmes was mentioned. Product placement in the vast majority of television series is controlled by existing codes of practice. The placement of tobacco goods in a film, or elsewhere that might not be covered by the codes of practice under television and broadcasting legislation, will be covered by sponsorship and by the clause. An agreement between a broadcaster and a tobacco company to use particular tobacco goods in a film or drama with the intention or effect of promoting that company's brands would be caught by the Bill.

Caroline Spelman (Conservative, Meriden)

What happens in the event of a foreign film? How would a British Government make sanctions stick on two American parties—an actor and a tobacco company—who had, perhaps only verbally, struck an agreement about product placement? Will we have censorship in our cinemas?

Yvette Cooper (Labour, Pontefract and Castleford)

There are two separate questions: is the agreement verbal or written, and is it an international film? First, the Bill does not specify that the sponsorship agreement must be written; it could be a verbal agreement. If we specified that the agreement had to be written, people would simply make oral agreements, because it would be clear that we were providing an obvious opt-out from the ban.

The second point, about international films, is more difficult, because we do not have extra-territorial jurisdiction on the matter. We do not have the power to prosecute if there is an agreement between a US tobacco company and a Hollywood film for tobacco placement. Distribution and broadcasting of the film in question by persons in the UK would not be caught under clause 9, because no one in the UK, as far as we knew, was party to the sponsorship agreement with which the clause deals.

There is a question about the role that the British Board of Film Classification should play. The matter might most properly be pursued with the board, rather than through the Bill, which does not set out extra-territorial jurisdiction on the matter.

Caroline Spelman (Conservative, Meriden)

If an actor strikes a verbal agreement with a tobacco company, there is nothing in writing and they are challenged as having committed an offence, the defence may be that the actor smoked on screen purely because the character was a smoker and that the purpose was not primarily to promote tobacco. Surely we are about to create an enormous loophole. I am interested to hear what the situation would be with the British Board of Film Classification, because it is important that we relate that issue to the Bill. We must ensure that we do not just create a big loophole.

Yvette Cooper (Labour, Pontefract and Castleford)

The Bill would cover a sponsorship agreement between a British film and a British company. Clause 9(2) says:

``A sponsorship agreement is an agreement under which a party to it makes a contribution towards something, whether the contribution is in money or takes any other form (for example, the provision of services or of contributions in kind).''

I am not clear what the hon. Lady is proposing that would prevent the possibility of an individual, whether an actor or a film director, making a covert deal with a tobacco company that was against the law, that was an offence under this Bill and where they were effectively committing an offence but were not caught doing so. If she has a suggestion as to how it might be possible to amend the Bill to identify more easily situations where that was occurring, then I would look at those proposals. It would be worse to specify that it had to be a written agreement because then we would be encouraging people to avoid making written agreements. Even where there was clear evidence of their having accepted a contribution from a tobacco industry or some benefit from a tobacco industry, we would still not be able to prosecute them under the Bill if we referred only to written agreements. That is why it is right to talk about sponsorship agreements but, of course, if there is a written agreement, it is obviously much easier to find the proof on which to base the prosecution.

The hon. Lady asked about international films. This Bill covers who can be prosecuted in the UK. We do not have extra-territorial jurisdiction so that limits what we are able to do with Hollywood films. The BBFC has responsibility for assessing Hollywood films as they come into this country. It is for the BBFC, rather than this Bill, to deal with how we should control foreign films entering the UK.

Peter Luff (Conservative, Mid Worcestershire)

I am genuinely interest in this matter. What action can the BBFC take? This is not a Bill to protect minors from the effects of advertising, it is a Bill to ban tobacco advertising. If a film has quite blatant product placement—I think it was a Superman film which had blatant tobacco advertising, with a Marlboro van crashing in one scene—and a large section of the film can be said to constitute an advertisement, is the Minister saying the BBFC should refuse to issue a certificate for that film because it judges it to be too much of an advertisement for tobacco to be shown in a UK cinema?

Yvette Cooper

: That is not a matter for this Bill and not a matter that we should discuss in this Committee. We could have other discussions with the BBFC, particularly about films for children, but those are separate issues. I have anxieties about censorship and about freedom of artistic expression, which I made clear on the Second Reading. The aim of this Bill is not to prevent artistic expression. The hon. Gentleman raises legitimate issues to explore, but they are not covered under the scope of this Bill.

I return to an issue that is covered under the scope of this Bill—amendment No. 41, which refers to whether or not, if the purpose is to promote a product outside the UK, somebody could be caught by what was done by a third party incidental to the agreement that resulted in the product being promoted in this country. That is an interesting issue. Let us go through the occasions where this might occur. First, if someone had a sponsorship agreement with an event outside the UK, which was broadcast in the UK, it would not be prevented by this Bill because, as we are likely to discuss when we consider clause 11, this Bill does not cover broadcasting. Secondly, if it were a question of a news report of a particular event that took place abroad, that would not be covered by the Act because we would be talking about news reporting rather than a promotion.

If the question is whether a third party publishes a magazine, or puts it on the internet, or publishes promotional material about an event that took place abroad where there was a sponsorship agreement, if the original company could not have foreseen it, or had no reason to suspect, it has a defence under 9(a) and 9(b). The amendment tabled by the hon. Member for Meriden (Mrs. Spelman) is unnecessary. However, it is important that we include anything that could be considered the deliberate promotion of coverage of an event that took place abroad and where the third party might operate in conjunction with the original company or where it could have foreseen that the consequences of their sponsorship agreement abroad would be to promote the tobacco product in this country too.

Caroline Spelman (Conservative, Meriden)

May I put another example to the Minister? If it continues to be legal to advertise tobacco products on Formula 1 cars, helmets and clothing, what about children's dinky toys? The traditional manufacturer of such toys is Hornby—[Hon. Members: ``Corgi.''] I thank male Members for helping me on that. I was not a great one for such toys myself. How would such toys be regarded? They could carry the logo of the tobacco manufacturer. Are they all to be deleted from the British toy market and to be sold in their true colours only abroad?

Yvette Cooper (Labour, Pontefract and Castleford)

If a toy being sold in the country were itself an advertisement for a tobacco product, it would rightly be caught by the Bill. We would all be disturbed by the idea of a Bill that set out to ban tobacco advertising and promotion, with particular concerns about children, but permitted adverts to be splayed all over children's toys. That is a legitimate concern. If that is the kind of thing that the hon. Lady wishes to exclude—

Humfrey Malins (Conservative, Woking)

Order. We are dealing with an amendment concerning sponsorship agreements. Although it is permissible to mention other matters in passing, I hope that we can stay within the confines of the amendment before the Committee.

Yvette Cooper (Labour, Pontefract and Castleford)

If the purpose is to exclude such promotion because it is incidental, that would reinforce our objection to the amendment. That is exactly the kind of advertising or promotion that should be included.

The clause is indeed about sponsorship, Mr. Malins, whereas the earlier clauses referred to advertising. Just as when we talked about film, television and other kinds of media promotions, if the film involves blatant advertising of tobacco products, it would be covered by the Bill whether it was made in the UK, the US or any other country. Although the original makers of the film might not be covered by the Bill, because they were in the US and we do not have extra-territorial jurisdiction, the distributors of the film would be covered. We were talking about examples that are not covered explicitly by advertising, but that we are covering by sponsorship. Sponsorship is not covered by the Bill if it is a non-UK film and the distributors are not covered by something that is about sponsorship as opposed to advertising. I hope that that explanation clarifies clause 9 and the amendments.

Caroline Spelman (Conservative, Meriden)

I am not satisfied that we have dealt adequately with this grey area. I understand the rationale for not insisting that sponsorship agreements are in writing and I accept that it might drive the agreements underground. I suspect that many of them are informal agreements anyway. Their precise effect on the market is probably never discussed in great detail with the parties to the sponsorship agreement. If I am correct in the way that I understand that these things are constructed, I suspect that one party is most interested in the sum of money that it will receive in return for such an agreement.

I do not feel that we have been left with a clear idea of how effective this clause is likely to be. I am sure the Minister will agree that, in terms of smoking prevalence among young women, the most damage is done by a Kate Moss, for example, strolling down a catwalk smoking a cigarette. Furthermore, if it is a clearly identifiable brand, that increases the level of damage. The hon. Member for Rother Valley (Mr. Barron) is shaking his head, but I can assure him that market research has shown that young women in particular, who aspire to the kind of figure that Kate Moss has—the opportunity for which has unfortunately long eluded female members of my age—perceive a film or pop star of that status smoking as an indicator to a way towards achieving that perfect shape. We are left with quite a grey area on this point, and one that is quite difficult to clear up, but there is no question but that we shall see a rise in product placement where more conventional types of advertising are closed down.

It was certainly not the purpose of our amendment to create a loophole under this whole discussion on sponsorship—quite the reverse. Equally, we are trying to be fair and realistic about what it would be reasonable to expect of the parties to the agreement. It is still quite hard for people to see what the ultimate effect of some of their actions can be. However, if, in the opinion of the Minister, the removal of the words ``or effect'' will just enlarge a loophole, it would be right to withdraw the amendment if it would just enlarge the loophole. When we come to clause 11, we shall be discussing more precisely the whole position of broadcasting, and that will be a tricky subject, and one difficult to manage. It might be better if we withdrew amendment No. 41 and had a more focused discussion on broadcasting methods later.

Humfrey Malins (Conservative, Woking)

Order. We are debating amendment No. 39.

Caroline Spelman (Conservative, Meriden)

And amendment No. 41.

Humfrey Malins (Conservative, Woking)

Indeed, but amendment No. 39 is the lead amendment and that is the only one that may be withdrawn with leave of the Committee. Should that happen, the other would fall.

Caroline Spelman (Conservative, Meriden)

Thank you for that correction, Mr. Malins. We shall leave discussion of amendment No. 41. I wish to place on the record that, as with the matter of internet service providers—this is a message to noble Members in another place as much as anything—with the time available to us, we remain unsure that the loopholes concerning sponsorship have been closed by the wording of the clause. They may wish to return to that matter. We accept that our amendments would not achieve our objective of trying to bring more precision to this clause and, for that reason, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Humfrey Malins (Conservative, Woking)

We now come to amendment No. 40.

Mr. Luff rose—

Caroline Spelman (Conservative, Meriden)

I beg to move, amendment No. 40, in page 4, line 27, after first `contribution', insert `in the course of business'

We missed our Whip this morning, and I got myself into some trouble, but now he is here. We are very glad to see my hon. Friend the Member for Mid-Worcestershire (Mr. Luff) back this afternoon. Since anyone reading Hansard might be concerned for his health and welfare, I am pleased to record that he is back with us.

Amendment No. 40 deals with a slightly separate subject area. The prohibition of sponsorship agreements in clause 9 is not limited to activities that are carried out in the course of business. In that respect, it is unlike tobacco advertisements in clause 2 and free distributions in clause 8, which are limited to activities carried out in the course of business. Agreements that will have no commercial effect will be caught by the definition of the sponsorship agreement in clause 9(2).

Two scenarios illustrate the absurdity of the present provision. First, if a person agreed to contribute cigarettes or cigars for guests who were smokers at a local football club dinner, both contributor and host could be liable to prosecution. That is similar to the difficulties posed by the corporate entertaining examples that I would like the Minister to address. Secondly, if a private club organised a cigar tasting, all subscription-paying members of that club would be guilty of an offence under subsection (1). The clause can be clarified by inserting the words

``in the course of business'',

which would make it consistent with other parts of the Bill. The amendment is relatively straightforward, but is designed to make the Bill clearer and more workable.

Yvette Cooper (Labour, Pontefract and Castleford)

I accept the principle behind the amendment. At every stage, we have tried to distinguish between what an individual might do and what would be done in the course of a business. There is no intention to prosecute individuals who may choose to sponsor particular events. We have distinguished in the clause between what individuals do as a matter of choice, even if we may not like it, and what is done in the course of business. I ask the hon. Lady to withdraw her amendment, so that we can consider what the exact wording should be to ensure that the clause complies with the intention of the rest of the Bill.

Caroline Spelman (Conservative, Meriden)

That is very helpful. I will withdraw the amendment on the understanding that the Minister accepts the spirit in which it was made, and will find wording that reflects the distinction and makes the clause consistent with other parts of the Bill. That will be music to the ears of members of people from all parties, as individuals who have an interest in tobacco products. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Ian Bruce (Conservative, South Dorset)

The Government are in danger of creating a complication that they did not intend. There is an understanding that advertising is acceptable if wholesalers and manufacturers are advertising to sellers of tobacco. By not defining sponsorship, something that is considered to be promotion under clause 4 could also be caught as sponsorship. For example, it is not unusual for a tobacco company to have an after-dinner speaker, possibly a famous person, at a conference of its sales agents. That individual will be paid a sum of money that could certainly be regarded as sponsorship. Would it be an offence for an individual, as part of that sponsorship agreement, to give a speech helping to promote tobacco products to the retailers? That sort of marketing activity is widespread. Perhaps the Minister, in trying to help my hon. Friend the Member for Meriden to ensure that the activity concerned would have to be conducted in the course of business, would consider a different definition in clause 9, of who is being sold to, or for whom the sponsorship is designed.

We should also refer to clause 18, which relates back to clause 9 for certain international events. It seems wholly illogical that tobacco promotion through sponsorship is to be allowed, for a period of time, if it is connected to an international event. Either we think it wrong to have sponsored events that deal with tobacco promotion, or we do not. The fact that the promotion is connected to an international sporting event should make no difference.

I can only assume that the Prime Minister, and his colleagues, having accepted £1 million from Bernie Ecclestone—even though they had to give it back—promised Mr. Ecclestone that they would continue to support him, and have stuck to that promise. That is one sort of definition of an honest politician—once bought, he stays bought.

I am worried about some things that may be excluded, but which we might think it good for tobacco companies to do. We should be telling tobacco companies that they are causing ill health and should be putting money into research to allow people to be cured, or creating a situation in which smoking tobacco would not be a health hazard. That sort of sponsorship activity would put the tobacco companies in a good light and would help them to improve their image. But it would also give them promotion, and is therefore banned by the clause.

Tobacco companies set up charitable foundations: it is good for their image. That is why companies whose first requirement is to make profits for their shareholders give money to charity. It may be that the tobacco industry is doing things that are good for the health of the nation, but which would be banned. We may be sending the message that the companies can, if they can get their advertising and promotion through the Bill's loopholes, do harm, but that the Government will make sure that anything positive that they might do is banned. Not only would the tobacco companies be clobbered, but so would the charities that would receive money in sponsorship deals to look into tobacco diseases. It is a horrible thought that a researcher receiving money from a charitable trust to examine how to do away with the harmful effects of tobacco might be caught by the Bill.

I have another, perhaps self-interested, point. Mine is very much a sailing constituency—a Royal Yachting Association centre of excellence is being set up in Portland. We organise many international sailing events. Volvo and BT are big sponsors, but the tobacco industry is also involved in sponsorship. It is extraordinary to think that we can tell tobacco companies that they can still sponsor events held in France, which are televised and reported, but that UK sport must have that business taken away and sent elsewhere. We need an even playing field. We need to ensure that sponsorship money is not spent elsewhere, so that it takes events away from the UK. The Government owe it to everyone, not just those who have paid £1 million—and got it back—to make sure that people are not disadvantaged simply because they want to do their work in the UK.

I want to put some dictionary definitions on the record, because the Minister keeps talking about them. My hon. Friend the Member for Meriden was right; she turned to me when she smilingly sought sponsorship for her Bill, and I wrote back to her. I do not know whether I am on her list, because she was overwhelmed by colleagues who wanted to be sponsors of her Bill, and that is what sponsorship is about.

The first definition of ``sponsor'' in the compact Chambers Dictionary—I cannot carry a bigger one around with me—is:

``one who gives his word that another will do something act in a certain way.''

The second definition is:

``godfather or godmother.''

We had better make sure that we are not godfather or godmother to someone who is a smoker. A further definition is:

``one who makes himself responsible for e.g. the introduction of a law.''

That, in fact, is the definition we had from the Minister.

It is only when we reach definition number four that we find what the Government are going for in the Bill. It is:

``a business firm that pays for a radio or television programme and is allowed time to advertise''.

The fifth definition is:

``one who agrees to contribute towards the cost of an event etc. or to a charity if someone else performs some task.''

We understand that the final two definitions are those that the Government intend for the Bill, but I do not think they have defined their terms sufficiently clearly because the other three types of sponsorship might inadvertently be caught, and I know that the Government would not want that to happen.

Kevin Barron (Labour, Rother Valley)

I would like to try to answer the points that the hon. Member for South Dorset has just made about the dictionary definition of sponsorship. First, both he and the hon. Member for Meriden have said on this clause, as on many others, that there is a loophole. The hon. Member for South Dorset said that there was a complication that the Government did not perhaps intend. Given that the Conservatives declined to give the Bill a Second Reading, they should be quite happy with the Bill as presently constructed, because it would be ineffective if we believed what they say.

On sponsorship, does my hon. Friend the Minister agree that the Bill is intended to stop sponsorship that relates to tobacco products? I would like turn to Silk Cut. The hon. Member for South Dorset said that there are no names on Silk Cut advertisements, just a large silk cloth on a stage, with a tear in it, and that we all know what that means. Let me refer again to the appendices in the Health Committee report on defining sponsorship of tobacco products. The report considered the links between sponsorship and advertising. As I said earlier, those links can become very blurred when we look around the issue. It is very difficult to define that in a Bill without making it a one-clause Bill that says, ``X promotes, advertises or sponsors tobacco products directly or indirectly''. Definition is very difficult.

Let me turn to how sponsorship is designed to direct the attitudes of young people, perhaps not necessarily toward a single product, but towards a brand of tobacco products. Some evidence in the Select Committee report was submitted by a company called M & C Saatchi, with which I think most of us are familiar. It related to what Silk Cut did in night clubs in the UK—the Leadmill in Sheffield was one such venue—a few years ago, and to what was being done in universities up and down the UK. The evidence relates to what I think was called the Silk Cut renaissance tour, and I want to quote from a brief published on 7 May 1996 on the sponsorship of those events. It said:

``Silk Cut is actually a cool brand to be seen smoking because it is enabling more Renaissance club nights... Therefore the sponsorship advertising will need to communicate the relationship between Silk Cut and Renaissance by featuring the extensive list of gigs and by appealing to their self-image to give them some defensive ammunition.''

That is interesting, because it shows that tobacco companies target young people.

Young people, by their nature, are not easily taken for a ride. They do not easily latch on to things. The hon. Member for South Dorset mentioned billposter sites that do not even tell one what brand they refer to; but an image is shown, and an inquiring mind can work out what it is. Inquiring minds are likely to be younger rather than older.

Let me quote further from M & C Saatchi's evidence:

``Urban Venturers: Aged between 18-30, students/graduates just out of university, short of money but spend all they have on good nights out. They are very advertising literate, and consequently very wary of big brands latching on to aspects of their lifestyle and exploiting them. To this end Silk Cut needs to complement the Renaissance imagery in an intriguing and stylish way.''

That shows how companies sponsor events. They do not put everything up front, but use images to promote their products without actually saying, ``Please smoke Silk Cut cigarettes; you are of an age when you ought to be doing that.'' At some events, free products are given out as well, so it is not always the case that there is no direct link with the product that the companies are promoting. That is just one case in which the sponsorship was directed at young people at gigs and events, and where that sponsorship complemented the advertising and vice versa.

The hon. Member for South Dorset talked about his windjammer—or whatever it was.

Ian Bruce (Conservative, South Dorset)

Will the hon. Gentleman give way?

Kevin Barron (Labour, Rother Valley)

No. I will finish what I am saying and then the hon. Gentleman can get to his feet. Silk Cut sponsored a boat for the Whitbread yacht race, which had a Silk Cut emblem on it, and I can quote from a document that advertisers used, which states:

``Silk Cut is sponsoring a boat in the Whitbread yacht race and, therefore, is actually quite a masculine, adventurous brand.''

Again, that document refers to the promotion of the brand to people who watch racing. I do not think that racing is watched by young people in particular, but I am not sure. My constituency could not be further from the sea. We have some country parks with water sports, but there is not much in the way of Whitbread yacht racing in my area.

Let me turn to the Saatchi brief of 1996, which came to light during the investigations. It was headed ``Why we are advertising'' and said:

``Silk Cut are sponsoring a boat, captained by Laurie Smith, in the next Whitbread Round the World yacht race. In order to get maximum publicity from this event they want to place `announcement' ads in all national newspapers that run editorial on the race—to appear next to, or near, the editorial.''

Again, we can see how sponsorship of an event can be promoted far more widely than the windjammer or the name on the side of a yacht. Events are promoted right into our national media so that Silk Cut can be linked with yacht racing. I do not know which newspapers have editorials on yacht racing—perhaps quite a few in the constituency of the hon. Member for South Dorset, but very few in mine. That is how sponsorship is used to advertise and promote a product.

Ian Bruce (Conservative, South Dorset)

The hon. Gentleman quotes some of the things that I said, but he has completely missed the point. I told the Committee that the voluntary agreement that Silk Cut had was in my view easier to police, because the company was policing itself.. Under the voluntary agreement, it was easier to keep that brand name off the television screens and to ensure that Silk Cut jackets were not available to the television cameras either.

I do not dispute the fact that sponsorship by tobacco companies is intended to promote cigarettes. If the hon. Gentleman had listened carefully to my previous speech, he would know that we were trying to achieve exactly the same type of prohibitions on advertising as on sponsorship. We should not get involved in a confusing discussion about the difference between the two, which again provides enormous loopholes.

Kevin Barron (Labour, Rother Valley)

I did not want to misunderstand the hon. Gentleman. I think that I know what he is saying now. Silk Cut was probably much better at screening as regards sponsorship and the national media than other companies have been.

I take the hon. Gentleman back to the first sitting, when he said:

``The great thing about a voluntary agreement, is that when one tobacco manufacturer finds a way round the agreement and decides to go off in a different direction, the Minister can pick up the phone, talk to the Tobacco Manufacturers Association and say that what the manufacturer is doing is harmful and the Government are worried.''—[Official Report, Standing Committee A, 30 January 2001; c. 20.]

I would much rather have the agreement in statute, which is what the Committee is about, so that a Minister does not have to pick up the phone when people breach codes that they have agreed in principle to stick to. That situation has gone on for many years, and it is about time that it ended, which is what the Bill is about.

My final point is also about the connection between sponsorship and advertising and/or promotion. When the Health Committee took evidence last year on the tobacco industry and the health risks of smoking, the advertising agency CDP—which is one of the top five advertisers in the country—submitted a memo dated 20 January 1998 from Barry Jenner to Rupert Pyrah. It talked about what had happened the night before, when Formula 1 racing cars had appeared on the news because a new racing car was being promoted. The small faxed memo says:

``Barry,

As I'm sure you are aware there was excellent coverage of the new Jordan car last night on both the Nine O'Clock News and the News at Ten. The respective All Men TVRs—

that must be industry jargon—

for the bulletins were 11.8 and 14.4.''

I assume that that refers to the seconds during which the images were on the national news on our television screens. The memo goes on to say:

``If we assume that the coverage equated to 60''—

again, I think that that relates to the exposure time on television, with which I am not familiar; the hon. Gentleman can tell me about it in a few minutes—

commercial on each station, I've estimated the equivalent advertising value to be £185,000. When the value of additional news spots on Channel 4, Channel 5 and Sky are added in, I expect the figure would exceed £250,000.

Not bad to start off with!''

That is a classic example. Sponsorship in the form of emblems and names on Formula 1 cars takes place not only when we are watching a Formula 1 race, but even when Formula 1 cars are launched and are in our national media. They are on the news. ``News at Ten'' does not exist any more—[Hon. Members: ``It is back'']. I do not have the precise ratings for ``News at Ten'' or the ``Nine O'Clock News'', but they are high. Buying time in them gives real added value, particularly on the BBC, which does not have adverts. We have clear evidence that the advertising agencies promoting such sponsorship know exactly how to get exposure for tobacco products.

The growth in tobacco sponsorship in Britain, particularly in sports, took off when we decided, many years ago, to stop advertising cigarettes on national television channels. Sport became the recipient of that sponsorship, whether it was a case of Benson and Hedges cricket or Formula 1 racing. That was another way of getting tobacco promoted in our national media. The Wilson Government, which came to office in 1964, introduced a voluntary code, but it soon became clear that people were getting round it. Companies decided that they had to accept the ban on television advertising, but looked for ways round it, as the hon. Member for South Dorset said at our first sitting. It is in the nature of tobacco companies to do whatever they can to keep their products in our minds.

Ian Bruce (Conservative, South Dorset)

I have been so impressed by the hon. Gentleman that I make him a pledge that when he calls for a vote against clause 18, which allows Formula 1 advertising to continue until 2006, I will support him—as he supported my early-day motion when I arrived in the House. I hope that I can rely on him to call for such a vote.

Kevin Barron (Labour, Rother Valley)

That is tempting, but I will leave clause 18 until we get to it. The only thing that I have to say to the hon. Gentleman is that the organisers of Formula 1 have said that they could bring an end to sponsorship more quickly. No amendments seem to have been tabled on that, otherwise we could have debated it. However, we will cross that bridge when we come to it.

Ian Bruce (Conservative, South Dorset)

Can I help?

Kevin Barron (Labour, Rother Valley)

No, I think that the hon. Gentleman has helped me enough.

A few years ago, litigation against tobacco companies started to be successful, initially in the United States. We have become more concerned about tobacco promotion. Parliamentarians on the Select Committee considered a mass of evidence before producing the report last year. We can now see that people have for years been getting round the voluntary codes because they do not want to be restricted. If we were talking about food or some other product, people might say, ``There's no harm done, is there?'' However, we have to keep remembering that—difficult though it is for many people to accept—every day, 300 of our fellow citizens in this tiny country die early as a result of tobacco-related diseases. If we had been at war for the past 20 years and losing 300 people every day, there would be a lobby in this place and many others against it. By including sponsorship in the legislation, the Government are going some way towards stopping the promotion of tobacco products and preventing people getting round voluntary codes, as they have been doing for decades.

Yvette Cooper (Labour, Pontefract and Castleford)

The clause is extremely important. My hon. Friend the Member for Rother Valley is right that sponsorship has been a way of increasing what is effectively advertising and promotion of tobacco products through what the tobacco companies clearly regard as a powerful way of communicating their message to smokers and potential smokers. Subsection (1) sets out that

``A person who is party to a sponsorship agreement is guilty of an offence if the purpose or effect of anything done as a result of the agreement is to promote a tobacco product''

and subsection (2) sets out a clear definition of a sponsorship agreement. The clause does not ban companies from making donations. It does not ban them from being good corporate citizens and donating money to charity or to events. It simply bans them from promoting tobacco products as a result.

The hon. Member for South Dorset gave the example of a tobacco company that wanted to donate to a charity in order to fund some health research. If a company wants to donate to a charity to promote health research, let it. However, we must be slightly cynical about its interest in research into, for example, a cure for lung cancer if the price of its donation towards research is the promotion of its tobacco products, which cause the disease. Such promotion and sponsorship should not be permitted under the Bill.

It is true that we cannot ban international sponsorship. However, we can and should work with our European partners to achieve a Europe-wide ban. We can also work with the World Health Organisation to try to reduce world-wide sponsorship, particularly of events. I think that we will have some opportunity to work with international partners and colleagues on that. It is reasonable to require UK sporting, artistic and other events to find other sources of sponsorship.

The Government set out their intention from the beginning in order to allow time for sports to find alternative sources of sponsorship. The bottom line remains that sponsorship of events for the sake of promoting tobacco products must stop because it is a powerful way of promoting tobacco products and smoking. My hon. Friend the Member for Rother Valley is right. When the health consequences are 120,000 deaths each year, such a major form of advertising should be prevented.

Question put and agreed to.

Clause 9 ordered to stand part of the Bill.

Clause 18 - Transitional Provisions: Sponsorship

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 44, in page 9, line 19, leave out `a' and insert `the'.

Humfrey Malins (Conservative, Woking)

With this it will be convenient to take amendment No. 45, in page 9, line 20, leave out `a sponsorship agreement' and insert `to all sponsorship agreements'.

Caroline Spelman (Conservative, Meriden)

I listened carefully to your advice, Mr. Malins. I held back in our debate on clause 9 from talking about different time periods for the application of sponsorship because they seemed to relate most directly to this clause. I would certainly like to discuss that matter under a stand part debate, if possible. Our debate on the clause has been brought forward in the order of consideration to follow the general discussion of sponsorship.

The clause will enable regulations to be made to provide transitional arrangements and agreements for the phasing out of sponsorship. The Secretary of State said on Second Reading that the Government intended to implement a timetable for sponsorship that had previously been laid out in the European directive. Subsection (2) paves the way for that by saying that the date

``may not be later than 1st October 2006.''

That is an innocuous little phrase. We know that the debate that rages surrounds the differential hidden behind that between the different sports. I would entirely support my hon. Friend the Member for South Dorset in calling for a level playing field for these sports. I do not see why we should slavishly follow, as we were encouraged to do on Second Reading, the timetable laid out in the European directive. The whole logic behind having a differential agreement for different sports is shot through. To pay tribute to the hon. Member for Rother Valley, he convened a most interesting meeting of the all-party parliamentary group on smoking and health, and received a presentation from Simon Rines of International Marketing Reports, who made a strong case for a level playing field.

Kevin Barron (Labour, Rother Valley)

The point that Simon Rines made to that Committee, if my memory serves me well, is that the deadline of 2006 should re-examined, not that everything should wait until 2006 to be finished. Is that correct?

Caroline Spelman (Conservative, Meriden)

It may astonish the hon. Member to hear that I cannot see why that should not be possible. The preferential treatment given to Formula 1 under the transitional arrangements, made possible by the wording of the clause, is difficult to understand. Formula 1, of all sports, is clearly well placed to replace tobacco sponsorship. Indeed, that is already happening. So we are legislating for something that is happening quite naturally. Companies want to get out of tobacco sponsorship, and the ascendant companies that are starting to sponsor the sport are all from telecommunications, computers and the new emerging technologies.

The trouble starts with the logic behind the differential arrangements that the clause permits. On Second Reading, the case was made strongly for sports such as darts, which will have greater difficulty in getting replacement sponsorship. I should like to encourage all hon. Members to move towards a level playing field, for which strong arguments have been put forward. It is not necessary to differentiate under the transitional provisions between so-called global sports. Perhaps the Minister will clarify whether snooker is now regarded as a global sport. It enjoys an audience of 10 million adults and is watched in 150 countries. It may not have the same glamour as Formula 1, and is hence less sought after as a target for sports advertisements, but it is difficult to see why snooker should have preferential treatment but darts should not.

The amendments may not be worded in a way that would achieve that end, but they raise a strong objection with the Government for the lack of a level playing field. We are effectively free to legislate as we wish, since the European directive was brought forward on the wrong basis and annulled. Why must we pursue this preferential treatment for Formula 1? If I were in the Government's position, I would be embarrassed that preference has been given to that sport and about all the publicity concerning the donations that were received and then returned. That was doubtless effective from Formula 1's perspective, as it appears to have bought the preferential treatment without having to spend money. The situation is unsatisfactory, and the public and the advocates of different sports find it difficult to understand.

It appears, from the way that hon. Members on both sides of the Committee have articulated their surprise about those arrangements, that there may be a lot of cross-party support for changing the scope for those differential arrangements under clause 18. After seeing the strength of support in Committee for creating a level playing field, the Minister may want to give some thought to revising the Bill on that point on Report.

The point behind our second amendment is that there should be a decision to include all sponsorship agreements rather than a particular sponsorship agreement. That is perhaps an imperfect way to get to the point where all sponsorship agreements are treated fairly and in the same way. Preference should not be given to those best placed to seek alternative sources of funding.

Tobacco sponsorship accounts for only 5 per cent. of all European sports sponsorship. It is not as big a player as we have all been led to believe. Significant sums are involved in the sponsorships—£177 million for Formula 1 compared with £9 million for snooker. Darts and some lesser sports do not reach even £1 million.

Ian Bruce (Conservative, South Dorset)

Is it not extraordinary that, where sponsorship has a real impact on tobacco consumption, the Government are granting further time before a ban, yet where it does not much affect people's consumption, the ban is to be instant? That is so illogical.

Caroline Spelman (Conservative, Meriden)

My hon. Friend makes an excellent point. I simply cannot understand such illogicality, and it leads me strongly to oppose the Bill. To treat particular sport sponsors preferentially and single out one sponsorship agreement to be dealt with transitionally in a different way is to conform ourselves to what might have been in Europe. Perhaps we should start conforming to what is happening in the marketplace now.

Some of the big players in Formula 1 no longer want tobacco sponsorship. The Williams Formula 1 team refused the Rothmans sponsorship and turned to Compaq. Ford also said no to Formula 1 sponsorship. The beginning of an important trend is happening in the real world, which is different from a notional European directive reappearing in a different guise at some indeterminate point in future. It is difficult to accept preferential treatment for one particular sport.

My hon. Friend the Member for Ryedale (Mr. Greenway) made a perceptive point. The main purpose of the Bill, with which we entirely agree, is to reduce the prevalence of smoking, but how effective will it be? As my hon. Friend said, it is difficult to understand how the increased prevalence of smoking among young women will be affected by the sponsorship of darts, for example. There is a disconnect, which makes one wonder why darts should be treated more severely than more glamorous sports with a wider appeal across the sexes such as Formula 1. The argument is tenuous and creating a level playing field for all sponsorship agreements would improve the Bill. It would be easier to understand and would more effectively address the Government's declared objective of removing from advertising those elements shown by market research to have a significant impact on smoking prevalence.

At a meeting of the all-party group, the market research was spelt out clearly—there is image transfer from glamorous sports to tobacco products. As a result of advertising in Formula 1, tobacco is seen as glamorous, exciting, making one ``youthful'', ``adventurous'' and ``sophisticated''—words used by consumers affected by that advertising. That is a factual description of the impact of sponsorship agreements and it makes it difficult to understand why Formula 1 should be accorded preferential treatment.

I hope that I have made a strong case and that Labour Back Benchers, who are susceptible to calls for a level playing field, might consider supporting us over this matter. Maybe together we could persuade the Minister to revisit this on Report.

I find it difficult to see the justification for treating one sport—or if snooker is caught into it, two—in a preferential way, given the impact that those sports have, as established by market research, on advertising of tobacco products.

Kevin Barron (Labour, Rother Valley)

The hon. Member for Meriden said that we have to recognise what is happening in the marketplace. She also quite rightly said that the all-party group saw in graphic detail that Formula 1 is shedding tobacco sponsorship and that telecommunications and computers were the highest growth areas. That is not happening because they want to do it; it is happening because there has been an international debate for many years about the effect of tobacco sponsorship on Formula 1, the growth of sponsorship and the amount of time that it is on our television screens. Nobody sits down for a few minutes of a Formula 1 event. Although people rarely watch it all, we are not talking about the 90 minutes of a football match. The viewer is there for a long time. There are a lot of images flying around on the trackside and on the cars; there is a massive exposure of images.

Many years ago, when we were in opposition, I was involved in some of the negotiations about how to overcome the problem, not of sports sponsorship here at home but of sports sponsorship of international events. There is one example, possibly two, of what could be called international events. The obvious one, because of the amount of money that the tobacco companies put into it, is Formula 1 racing. I do not think anything would have changed in the marketplace with Formula 1 racing if it were not for the intention, initially of the EU, and after we were elected in 1997, of the Government, to remove the block on the EU directive that the governing Conservative party had had on for many years.

Mrs. Spelman indicated dissent.

Kevin Barron (Labour, Rother Valley)

It is well documented—I have the lead Cabinet minutes in front of me if we want to debate that issue—and it was clear that the Conservatives were not going to lift that block. In turn, during the 1992 general election campaign, the Conservative party made a successful deal to rent bill poster sites—again, I have the evidence, which was well documented in debates—because they had the block on the European directive aimed at tackling this issue from the public health angle.

I have to say to the hon. Lady that the marketplace has been shaped over many years by discussion and debate. It was thoroughly shaped on 1 May 1997 when we came into office with such a large majority. Eventually it moved and the only way around that was to scurry off into the European courts, as tobacco companies did, looking for another way to try to stop this move. That is the true marketplace. It is true that Formula 1 is an international sport and hon. Lady said earlier—[Interruption.]

Ian Bruce (Conservative, South Dorset)

It is Bernie paging.

Kevin Barron (Labour, Rother Valley)

He would not be on my pager. The hon. Lady said earlier that we were going to take this action independently. I must tell her that some, but not all, countries limit tobacco promotions when there is Formula 1 racing in their countries. With the aim of getting international agreement, it was suggested that names would be taken off, and just the logos and colours used. On that basis, it was always going to be treated differently to our own indigenous sponsorship agreements. No matter what people think about when this is going to end, it is going to end and that ending is in sight. When I was promoting a Bill under the private Bill procedure in the 1993-94 Session, that seemed decades away, especially given the amount of opposition that we had.

Caroline Spelman (Conservative, Meriden)

I am grateful that the hon. Gentleman has given way because I want to return to the blocking minority on the directive. As I am sure that the hon. Gentleman is aware, the mechanics of European voting mean that one member state cannot unilaterally pull off a blocking minority vote. There has to have been an alliance and, for the record, the German Government at that time was also part of that blocking minority. I should like to know whether the hon. Gentleman would be prepared to press his Government to seek an alliance in Europe for a level playing field on these sponsorship agreement, quite possibly bringing forward the date, as I believe that he is in favour of that. Alliances have to be struck to bring about change.

Kevin Barron (Labour, Rother Valley)

The only thing wrong with that is that one of the reasons why the European directive failed in the European Court was that it was said that some tobacco advertising issues were distinctly to do with the member state and not with a wider European issue. Public health is a wider European issue. I did not see the full judgement but I have seen it in different parts and one of the points was that, in most instances, tobacco advertising is peculiar to member states and therefore the directive could not be introduced. We have to recognise that.

Ian Bruce (Conservative, South Dorset)

I am grateful for the hon. Gentleman giving the example of the Conservative party unilaterally stopping tobacco advertising on all those hoardings during the election campaign by putting up Conservative posters. That was a good idea.

The hon. Gentleman is an honest man, and I am sure that he will give us an honest answer to this question. What did he think of the decisions by the Government—the Chancellor, the Prime Minister and all those people who were in with Bernie Ecclestone—announcing that they would give Formula 1 many years of continuing sponsorship?

Kevin Barron (Labour, Rother Valley)

I shall not go into detail, but I was a shadow public health spokesman when we were in opposition and I spoke in Strasbourg in 1996. I was effectively looking after tobacco policy for the Labour party at that time and that question was asked of me then. It was an inter-group forum in Strasbourg. My immediate reaction, which was minuted, was that it would have to be dealt with differently because of the nature of Formula 1 racing.

At one level, the issue before us is whether Formula 1 should be allowed to go to the year 2006 while other sports are not. In part, the answer to the Conservative Members is that it might be up to them. They have tabled an amendment that seeks to take everything up to 2006. They may be sad to hear it, but I tell them I cannot support an amendment that would take everything up to 2006. The hon. Member for Meriden heard the debate in the all-party group when it discussed that matter, and has not tabled an amendment that might have tempted me. I only say ``might have tempted me'' because I do not look at any one thing in isolation. When I look at legislation, I look at the full picture.

Without question, Formula 1 gets a lot of money from the tobacco companies and is getting that replaced quite quickly. Then we dive down in terms of annual figures. Although I do not have them in front of me, the hon. Lady read them out. I think the next one was snooker at £9 million, then a lot of others at a lot less. I am tempted to ask my hon. Friend the Minister whether she agrees with this. Perhaps she will not, but I will try when she has finished talking to the Whip.

The banning of sponsorship is not unknown in other countries. Indeed it was banned it, I think, Western Australia. However, at the same time, the state government came up with something that I thought very innovative. Perhaps my hon. Friend the Minister will comment on this. They decided to convert the tobacco taxes in that state and give them to an arm's-length agency that could sponsor, or re-sponsor, sports and other events. Instead of young children being involved in sports sponsored by tobacco companies, they were involved is sports sponsored by public health lobbying organisations, such as ``Healthy Eating''.

There are many other smaller sponsorship deals, when we go below the line of snooker. For a tiny fraction of the amount that tobacco taxes bring into the Exchequer, the Government could consider replacing some of these smaller sponsorships to support, for example, fishing or dancing, with pro-health sponsorship —as opposed to anti-health sponsorship, in terms of tobacco. I realise that my hon. Friend the Minister cannot commit herself, or the Government, to such a thing, but it is an issue that we need to look at. It is not necessarily the case that sports, or other activities that are being sponsored by tobacco companies, would lose out.

I know my last point may be going a bit wide, Mr. Malins, but I will not participate in the clause stand part debate. I cannot tell the Committee what my wife calls me, so I shall just call myself local football supporter. I have been going mainly to my own club—Millmoor, Rotherham United football ground—for 40 years now. I have also been to most other grounds, including quite a few Premier league grounds, and the one thing that has struck me about sport sponsorship in the past decade is the massive change that there has been in football—our national sport—in terms of bringing in the Premier league, of salaries, and of everything else. Yet in no area of football can advertising by cigarette companies be seen.

Football is on our televisions on Saturday nights, Sunday mornings, it is on Sky most days of the week—which my wife hates. Here is a prime example of how tobacco companies could have had sports coverage—possibly even better than Formula 1—but the Football Association decided that tobacco products were not the right image that they wanted. Unannounced, without making a big deal of it, the Football Association decided not to get involved in that side of sponsorship.

Many other organisations, especially ones that take care of amateur sports, have nothing to do with tobacco advertising, because the industry is anti what most sports and activities are about. That is the truth of the matter, because no matter how they are defined, they are ill-health products. Under those circumstances, the Government ought to be considering other alternatives. When the legislation is in force, and sports organisations are under pressure because they cannot get the odd £1,000 or £500,000 in sponsorship, we—as parliamentarians—should be arguing that some of the billions of pounds of tobacco taxes earned by the Exchequer annually should be used to promote pro-health sponsorship among organisations for young children and others.

Ian Bruce (Conservative, South Dorset)

We are hearing interesting points on both sides of the debate. The clause is unsatisfactory, and that is why my hon. Friend the Member for Meriden tabled the amendments. It would be difficult for everyone on the Committee to agree with her on achieving an even playing field, as some might feel that doing so would simply prolong the time in which sponsorship could continue. If we did intend to prolong censorship, it would be sensible for each case to be considered by the Minister, but I do not think that my hon. Friend will win support for that premise, and I encourage her to withdraw her amendment so that the Committee can simply vote on whether clause 18 should stand part.

The Government have heard many opinions, particularly those of the hon. Member for Rother Valley, who makes such a strong case. He declares in the Member's Register of interests that he has been to Formula 1. He was sponsored by a drinks company and was obviously affected by seeing ``buzzing hornets'' and British American Racing pretending not to be tobacco companies. The hon. Gentleman will have been surprised by the switch in Labour party policy, and if he joins us to vote down clause and to give us cross-party support—the Liberal Democrats and Conservatives are on board—we could make the Government write another clause that could receive universal support from all parts of the Labour party.

Kevin Barron (Labour, Rother Valley)

The hon. Gentleman has very observant in spotting my attendance at Formula 1. A friend of mine was running the brewery that won the contract for Foster's lager in this country, and some people were coming from Australia to Silverstone. Bernie Ecclestone was supposed to be having lunch in our tent, but he did not turn up, which was a great disappointment to me, as we had arranged a photo-shoot.

Ian Bruce (Conservative, South Dorset)

For once, I am glad that I gave way to the hon. Gentleman. I was not suggesting for one moment that I would not take up the invitation if Foster's invited me to visit Formula 1. Members of Parliament have to understand what is going on, and we cannot do that without visiting events.

I would like the Minister to respond on one point. Voluntary agreements exist on what can appear on Formula 1 cars, and, in the United Kingdom, all the cars are painted with buzzing hornets. Since I am not a tobacco smoker, it took me a long time to work out that that meant Benson and Hedges. Apparently, that was the brand that Benson and Hedges put on the side of the vehicle. Will the Minister say what sort of thing might be allowed, and whether the clause would give companies an open season for the six years in which they may still advertise their products when they sponsor Formula 1 and other such sports?

Yvette Cooper (Labour, Pontefract and Castleford)

It is already 6.30 pm, and we had hoped to make considerable progress this afternoon. We still have half an hour, and may still make considerable progress, but Labour Members are happy to continue beyond 7 pm, or to return later this evening if the Opposition agree. I know that the hon. Member for Meriden has an engagement, and we would be happy to recognise that, as she was very understanding about my earlier engagement.

I want to respond to some of the issues that have been raised during this debate and want to turn to some stand part issues too.

Humfrey Malins (Conservative, Woking)

Order. Perhaps I can indicate to the Minister and to the Committee that I think that we have had a very wide-ranging debate on the amendments, and I propose to put the clause stand part question without debate when the time arrives.

Yvette Cooper (Labour, Pontefract and Castleford)

Thank you, Mr. Malins, for that extremely helpful guidance.

The clause sets out the power to make regulations to do with the time scale for implementing the ban on tobacco sponsorship. There will be time for consultation on those regulations, and for hon. Members, the organisers of sporting events or anyone involved in sponsorship to raise particular issues, concerns or interests about the regulations. We shall certainly listen to all representations, and that will provide an appropriate forum in which to discuss in great detail the appropriate time scale for introducing the sponsorship ban.

My right hon. Friend the Secretary of State said on Second Reading that it remained our intention to implement the policy and the timetable on sponsorship that had been agreed with our European partners in 1998 and subject to consultation that means that UK sports and events will have until July 2003 to find alternative sponsorship and that global sporting events will have until October 2006 to do the same, provided first that they do not sign new contracts with tobacco companies and secondly, that they phase out the current sponsorship that they receive. My right hon. Friend also set out our intention to publish draft regulations for consultation during the course of the Bill, which we hope to do as soon as possible.

That policy was agreed with our European partners, and we are keen to consult them on the timing of the regulations and the ban. We are keen to work with them on proposals to reintroduce a Europe-wide ban on tobacco sponsorship and advertising. The distinction between global and UK sporting events was set out several years ago. The bottom line is that sponsorship will be banned, and that is right. In clause 18, we set out a final date—1 October 2006—by which sponsorship should be banned, which is exactly in line with the directive agreed with our European partners.

We want to go further and to draw up worldwide agreements on tobacco sponsorship. We want to agree Europe-wide bans on tobacco sponsorship. We are keen to do that in collaboration with our European partners and with WHO. I hope that there is scope to do that and to make considerable progress. It is worth noting that the Federation Internationale de l'Automobile has said that it is keen to introduce a worldwide ban on tobacco sponsorship from 2006. My hon. Friend the Member for Rother Valley is absolutely right to say that would not have happened if it had not been for discussions at European level and through WHO and the extreme pressure now felt in many countries to get rid of tobacco sponsorship and tobacco advertising for the sake of public health.

This is an important clause. We need to set out a timetable. We will do so through proper consultation on the regulations, and will listen at that time to any representations that are made. It is right that we should have the flexibility to respond to the consultation process and to any issues that may be raised then. I urge the Committee to reject the amendment and to agree that the clause should stand part of the Bill.

Caroline Spelman (Conservative, Meriden)

Following the good advice of my hon. Friend the Member for South Dorset, I shall withdraw my amendment, but I should like to press the clause to a vote. I should like to gauge the support for seeking a level playing field and giving the Government a chance to reconsider.

Kevin Barron (Labour, Rother Valley)

Will the hon. Lady give way?

Caroline Spelman (Conservative, Meriden)

In the interests of time, I will not. The hon. Gentleman made a long and interesting speech on this subject. I have made my position clear.

Mr. Barron rose—

Humfrey Malins (Conservative, Woking)

Order. Has the hon. Lady given way?

Caroline Spelman (Conservative, Meriden)

I had sat down. Could you guide me, Mr. Malins, on whether the hon. Gentleman can intervene?

Humfrey Malins (Conservative, Woking)

It is a matter of discretion for the Chair. It might be more convenient if the hon. Lady treated this is as an intervention.

Caroline Spelman (Conservative, Meriden)

I accept that guidance and give way to the hon. Gentleman.

Kevin Barron (Labour, Rother Valley)

In withdrawing the amendment, is the hon. Lady giving notice that she will table an amendment that includes a date earlier than 2006?

Caroline Spelman (Conservative, Meriden)

There is still time to table amendments on Report. I would be guided in making such a decision by the level of support that an amendment might receive from the Committee. If the hon. Member for North Devon (Mr. Harvey) would return and reveal his voting intentions, there could be seven apiece. For once in this Parliament, we could produce a very interesting voting result, despite the Government's big majority. The level of support will guide my decision on what amendments to table on Report. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question put, That the clause stand part of the Bill:—

The Committee divided: Ayes 8, Noes 5.

Clause 10 - Brandsharing

Caroline Spelman (Conservative, Meriden)

I beg to move amendment No. 14, in page 4, line 44, leave out from `name' to `which' in line 46 and insert

`or emblem which is identical in appearance to a name or emblem'.

Humfrey Malins (Conservative, Woking)

With this we may discuss amendment No. 15, in page 5, line 1, leave out from `name' to `which' in line 4 and insert

`or emblem which is identical in appearance to a name or emblem'.

Caroline Spelman (Conservative, Meriden)

We want to make progress, but brand sharing is important and we must be careful to give it the right amount of time in debate. I heard what the Minister said about continuing tonight, but that places me in a slightly difficult position, as I intended to attend a cross-party event at 7 pm involving the Minister for Women and the respective parties' spokesmen for women. [Interruption.]

Humfrey Malins (Conservative, Woking)

Order. The Committee is becoming a little noisy.

Caroline Spelman (Conservative, Meriden)

Thank you, Mr. Malins.

Under the Bill, tobacco companies that have diversified into other areas will be penalised for using their brand name on products completely unrelated to their tobacco products, even if the logo is completely different from that used on the tobacco products. It is beneficial to all employed in the tobacco industry if those companies diversify to protect jobs.

It is difficult to understand why the Government object so strongly to tobacco companies diversifying into other areas. I would far rather that the companies produced another product, such as petrol or something that posed a lesser risk to public health. To shut the companies down completely with no alternative outlet would be a hard measure to impose on them. We need to find ways of encouraging the firms to move into other areas if possible, and not to penalise them for doing so.

However, certain companies will be caught by the brand sharing measure and innocent parties will be bound by the constraints of clause 10. I provided a good example on Second Reading—the Minister is familiar with it, but I shall repeat it to the Committee to demonstrate the problems that might arise—of a company that markets clothing and luggage under the Camel brand. It is separate from any tobacco manufacturing company and produces goods that could not possibly be described as tobacco-based products or accessories, such as boots, shoes and suitcases.

Originally, the company adopted the Camel logo that is traditionally associated with that brand of cigarettes. It is an international company that is based in Germany and the United Kingdom. In order to comply with the relevant European directive, it completely changed its logo and renamed its products Camel Active. The style of writing of the Camel name was completely different from the logo on a packet of cigarettes and the company continued to sell entirely tobacco-free products. The company is worried that it might still be caught by the Bill, so it has asked me to bring its concern to the Committee's attention. It might be an innocent victim, subjected to the clause's brand sharing restrictions.

It is interesting to reflect on the advice that was given on brand sharing when the European directive was annulled. I have a copy of a letter from the company— Worldwide Brands—which has been in close contact with the Advocate General who was instrumental in the decision to annul the European directive. As we all know, it was decided that the measure had been introduced on the wrong legislative basis. On brand sharing, the Advocate General held that

``the Directive's provisions on brand diversification advertising in no way contribute to the removal of trade barriers affecting brand diversification products.''

He was not minded to restrict brand diversification on internal market grounds. He concluded that

``since the Directive would not be an effective means of reaching its stated Internal Market goals, it was not proportionate to these goals and thus infringed the proportionality principle, the EC Treaty provisions on the free movement of goods and the basic rights to property and to pursue an economic activity.''

Brand sharing was not to be treated as harshly under the proposed European directive as it is under the Bill. Furthermore, the Advocate General held that

``the restrictions on brand diversification advertising violated the right to freedom of speech, as guaranteed by Article 10 of the European Convention on Human Rights... the Community legislator had not presented any evidence to suggest a link between brand diversification advertising and overall tobacco consumption... there were therefore no reasonable grounds to justify the restrictions on freedom of speech provided for in the Directive.

That interesting information about the European directive is relevant to our debate on brand sharing. Clause 10 does not provide an adequate solution for companies such as Worldwide Brands, which through its best endeavours has tried to break free of the accusation that when people buy boots and shoes with the Camel Active logo, that somehow fuels tobacco consumption and increases smoking prevalence.

Ernie Ross (Labour, Dundee West)

I have listened to the h Lady with interest. Does she know why the company originally chose the name Camel? If it chose the name because it is that of a well-known cigarette brand—even though it was used to market another product—and had enjoyed many years of sales based on that link, however tenuous, the company can hardly expect us not to say that it has had its good years but now we want to get rid of tobacco advertising and association with tobacco products.

Caroline Spelman (Conservative, Meriden)

I do not know the precise reasons for the company's choice of the Camel logo. We have to legislate for here and now and it is unreasonable to visit the sins of the father on the grandchild—especially when the company has made such a great effort to move away from an emblem that mirrors that on the cigarette packet. The present logo in no way resembles the cigarette brand logo and we should recognise the company's endeavours to tackle genuine concerns that young people might buy its clothing because they have in the back of their minds the connection with an attractive cigarette brand.

Ernie Ross (Labour, Dundee West)

I drink Guinness. The company that produces and promotes Guinness is called Diageo. There could not be two more dissimilar words; indeed, there was a big debate about what Diageo meant. However, that does not stop me or other people drinking Guinness. The company does not have much of a leg to stand on.

Caroline Spelman (Conservative, Meriden)

I suspect that the basic principle to which the hon. Gentleman refers comes under competition law—which is outside my sphere of competence. The question of whether start-up companies with logos similar to that of the original bearer of a logo can be perceived as having infringed on the market share of the original company is probably more accurately dealt with in the context of competition law.

The amendment deals with the need to recognise the efforts of a company that distances itself from an emblem that clearly and identifiably resembles—or replicates—a cigarette brand logo. The company that we are debating has been in discussion with the Government and was actively encouraged to draft amendments to deal with its dilemma. There are no Government amendments to the clause—although some may be in the pipeline—and we do not seem to be addressing the problem. Does the Minister intend to bring forward proposals to deal with difficulties such as those faced by Worldwide Brands?

Yvette Cooper (Labour, Pontefract and Castleford)

The clause provides regulation-making powers on brand sharing. We intend to consult on the detail of the regulations because we recognise that complex issues are involved.

As I said on Second Reading, the regulations do not aim to undermine genuine business diversification. If tobacco companies wish to diversify into clothing or any other trade and if they adopt completely separate branding and their intention is not to promote a tobacco product, such diversification would be welcomed, but we do not want to permit tobacco companies to move into alternative products and alternative uses of their brand that clearly aim to promote tobacco products.

A couple of documents that were extracted from the tobacco companies by the Health Committee show how the tobacco industry tries to get around rules that are designed to control it. The first said:

``If we feel we can legally say the words a `Special F1'''—

as in special filter—

``we can get a little close to more overtly implying the brand on the car''.

The second document said:

``We wonder if you could slightly corrupt the Jordan logo to include a large ampersand''—

as in Benson & Hedges—

``. . . the ampersand is not actually part of your logo though if it were to appear I believe people would recognise it as being so.''

Those two examples demonstrate how it would not be acceptable under the aims of the Bill to allow companies to use brands or logos that are not identical to the tobacco product brand, but are similar and have the same effect of promoting a tobacco product or brand. The amendment would allow Marlboro to promote Marlborough Classic Clothing where it simply adds the letters ``ugh'' to the name. The brand is still recognisably the same. Alternatively, it would allow a tobacco company to acquire Tommy Hilfiger clothing and then to introduce a Tommy H brand of cigarettes, which would clearly draw on the power of the Tommy Hilfiger brand to promote cigarettes.

We cannot therefore accept an amendment that would narrow the clause to simply refer to branding that is identical to that used by tobacco companies. There is clearly a distinction between brands that are separate and are not used to promote a tobacco product. We have no intention of including separate and distinct branding in the regulations. That is why we will consult in detail. We will allow companies to make representations to ensure that legitimate business diversification is encouraged under the Bill, but we cannot accept the word ``identical''.

Peter Luff (Conservative, Mid Worcestershire)

On consultation, I understand the Minister's objectives, which are honourable and noble in the context of the Bill. However, she is exploring a difficult area in which many value judgments will be required. I once advised the Alfred Dunhill luxury goods company, which did not deal with the tobacco end of the business. There is huge room for debate about where the promotion lies. I hope that the consultation will be genuine, thorough and unrushed. It is important for genuine businesses such as the Alfred Dunhill luxury goods company not to be caught up by over-rushed regulations.

Yvette Cooper (Labour, Pontefract and Castleford)

We certainly recognise the need for proper and thorough consultation. We are also keen to consult with the European Commission on its proposals. We recognise that this is a complex area, and we are keen to have a thorough and effective consultation process, but equally we do not want to allow a massive loophole into the Bill that would permit all sorts of products that are just slightly different from the original brand to be used to promote tobacco products.

Caroline Spelman (Conservative, Meriden)

I cannot help feeling that we are putting the cart before the horse here. Surely this massive consultation exercise should have taken place before the Bill reached Committee. I feel uneasy about letting through the clause without registering my objections. It is unnecessarily restrictive. We have been promised a big consultation exercise. However, that company has made an effort—no doubt it spent a great deal of money on completely changing its logo—that could prove to be of no avail.

I would be dissatisfied to let things stand. I have no desire to create a massive loophole that will allow through products that will increase smoking prevalence, but the fact that tobacco companies diversify into other markets, such as clothing, does not automatically lead to people smoking more cigarettes. There is not a tight correlation between the two. I would certainly like to encourage tobacco companies to diversify. I would far rather they produced something else, rather than tobacco that is associated with public health risks.

The Minister has put me in a difficult predicament because I will not know the outcome of her big consultation process in time to inform my decision on whether to let this clause through unamended. That decision has to be made now. I need to find some way of signalling to those who will consider the Bill in another place my concerns about this and one or two other clauses.

Yvette Cooper (Labour, Pontefract and Castleford)

I should inform the hon. Lady that Parliament will have the opportunity to discuss the regulations as they will be laid through the affirmative procedure.

Caroline Spelman (Conservative, Meriden)

I accept that we shall have the chance to debate them, but if the Government have anything like their current majority, we will not be able to alter them effectively. My best course of action is to press amendment No. 14 to a Division, to signal my concern about this clause.

Question put, That the amendment be made—

The Committee divided: Ayes 4, Noes 9.

Ian Bruce (Conservative, South Dorset)

This will be a 30-second speech. I understand that the Whips want us to finish by 7 o'clock.

We are in great difficulty because we have not seen the regulations, which really should have been produced in draft form for the Committee. Here is a branded packet of cigarettes with the House of Commons logo. We promote tobacco in the House of Commons using our brand. It is so important that we get this right and I want to signal that to allow the provision through without having seen the regulations is a travesty.

Question put and agreed to.

Clause 10 ordered to stand part of the Bill.

Further consideration adjourned.—[Mrs. McGuire.]

Adjourned accordingly at Seven o'clock till Thursday 8 February at Nine o'clock.