Tobacco Advertising and Promotion Bill [Lords]

Public Bill Committee, 9 May 2002.

Standing Committee A

Clause 2 - Prohibition of tobacco advertising

Tim Loughton (Conservative, East Worthing and Shoreham)

I beg to move amendment No. 3, in page 1, line 16, leave out from 'form' to end of line and insert

'or participating in doing so'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to take amendment No. 19, in page 1, line 16, after 'and', add 'knowingly'.

Tim Loughton (Conservative, East Worthing and Shoreham)

Welcome back to the Committee, Mr. Amess. Parts of the clause are pertinent to electronic communications and people involved in the internet industry. Such matters have been debated at length both in the House and in another place, but several issues have not been properly dealt with, hence our amendment. For precautionary purposes, I shall declare what is not a particular interest. I was a non-executive director of an internet web posting company, which was taken over by another American company in whose equity I am an increasingly modest holder—given what has happened to its shares. That experience has given me some knowledge of the problems that may be faced by such companies should the Bill be enacted in its present form.

Subsection (3) is a catch-all provision. It takes in almost every conceivable person who may have contributed towards the distribution of a tobacco advertisement in electronic form. I am talking not only about an internet service provider or a web posting company, but those businesses that may have been involved in distribution, or had provided the means of transmission, the hardware, the software, the telephone lines or the computer equipment. The amendment would remove ''participating in doing so'' from the provision. Under the Bill, those who are connected with the business, some of whom I have listed and who have no knowledge about—or make a contribution to—the distribution, dissemination or promotion of tobacco advertisements could be deemed culpable, because they had been involved in the equipment that facilitates the dissemination of information.

The amendment would still make it illegal to distribute tobacco advertisements in the form set out under the Bill, but it would limit the offence to those persons who were instrumental in that distribution. Surely it is not right that persons who could not possibly remove offending tobacco adverts that were distributed by electronic means are at risk of committing an offence. When I was involved with an internet company, we hosted websites for small

businesses and had a filter mechanism for clients, especially those who wanted to advertise products of a slightly lurid nature or fairly salacious photographs. We activated that filter by our code of conduct. However, that is increasingly difficult when those with websites can update them directly without having to go through the website provider, as indeed many Members do, including me.

Of course, it is difficult for the website host constantly to check for offending material. Given that there are millions of pages of internet websites to be examined, that is an almost impossible task. That is difficult enough for those directly involved in the internet industry whose business it is to host websites, but it would be impossible and irrational to expect those loosely involved with transmission lines, and other equipment involved in making available or hosting such material, to have any liability for material that falls foul of censorship laws, or, in this instance, prohibitions on tobacco advertising. That is why we would like to make it clear that only those directly involved in the transmission and communication of such prohibited adverts should be deemed in any way culpable under the Bill.

I would be grateful if the Minister were to elaborate on compliance with the e-commerce directive, which was to have been implemented by all European Union member states by 17 January, although it has not been. I am sure that she has had discussions and has taken advice on the subject. We treat internet service providers rather differently from other EU states. Under the directive, as is the norm in other EU states, ISPs are treated not as publishers or distributors but conduits for the transmission and immediate or temporary storage of information.

A conduit is different from a publisher. The Bill could be interpreted as treating ISPs as publishers, rather than as conduits providing the mechanism or framework for people to communicate their message, advert and wares for sales, for example. If ISPs are to be treated as publishers, there will be many implications outside the Bill for the liabilities of ISPs and others involved in putting together, hosting or transmitting websites on the internet. The Bill may be incompatible with EU law. It is also worth noting that in the United States, internet service providers have immunity for material to which they provide access.

Perhaps the Minister can allay our fears and guarantee strongly and convincingly that the sort of people who I have listed will not be included under what appears to be a catch-all phrase. As an adjunct to the amendment, we have tabled amendment No. 19, which would add the word ''knowingly'' to subsection (3). The Bill would then catch out only those actively participating in distributing, communicating or publishing prohibited tobacco adverts. Anyone who could be said, with any reasonableness—we will consider that idea under other clauses—to have done so unwittingly should not be caught out by the provision.

We are trying to make it clear that those likely to fall foul of the Bill are those who can reasonably be expected to be involved in controlling the material, rather than those who are completely subsidiary to

that process, and rather than providers such as telecom companies.

John Barrett (Liberal Democrat, Edinburgh West)

Any legislation that affects the internet affects a moving piece. I look forward to the Minister's assurance that the defences in clause 5 are adequate to cover all the possibilities that could arise from the fairly flexible and wide-ranging section in clause 2.

Advertising through the web is different from that through print and other media, and it is difficult to frame legislation to deal adequately with events that change daily. Anyone who has had any involvement with the internet, or the web, is aware of the wide variety of material available, and the ability to restrict tobacco advertising on the web will create a significant problem for anyone who deals with it. We must rely on the defences in clause 5, which states that a

''person does not commit an offence . . . if he did not know, and had no reason to suspect, that the purpose of the advertisement was to promote a tobacco product.''

I should like assurances that the defences in clause 5, on which we must rely heavily, will deal with any problems that the clause may cause.

David Wilshire (Conservative, Spelthorne)

I hope that the Government will take the amendments extremely seriously. If I as a layman in such matters understand the Bill correctly, we have a curious position. The part about

''providing the means of transmission''

is the one that bothers me most. As my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) says, that includes a huge number of people and businesses, and could make criminals out of an enormous number of law-abiding people.

I am not an expert—indeed, I am a total novice—about IT, but I believe that I have enough of a grasp to get the technical words right. If I understand how these things work, one first of all needs hardware—a computer, for example—to have a means of transmission. Without that, it is not possible. If someone who provides the means of transmission is to be caught by the provision, presumably that includes everyone working in PC World who sells computers that could be used. Nothing states that the person in PC World has a defence in saying that he did not know, unless the amendment is accepted. Therefore, everyone who works in PC World, Dixons, Currys, or anywhere else where people buy computers, or hardware, might be deemed to be helping the means of transmission.

Kelvin Hopkins (Labour, Luton North)

I do not follow the hon. Gentleman's argument. Is he suggesting that someone who sells a motor car is committing a crime because the car can be used in a criminal way? That is clearly nonsense.

David Wilshire (Conservative, Spelthorne)

One of the reasons that the hon. Gentleman does not follow my argument is that I have not yet had a chance to develop it. However, in due course, as I do so, perhaps all will become clear to him.

His example of a motor car salesman is interesting, because it makes my point.

I am not suggesting that in common law someone who sells computers might be caught. The hon. Gentleman is right. In common law, someone who sells a car cannot be held responsible for anything that the car is used for afterwards, provided that the car is in a proper state when sold. However, the difference between the hon. Gentleman's example and the matter under discussion is that the Bill would, if applied to the motor trade, provide that, irrespective of whether people know or do not know, if they sell a car that is later used for a crime, they would be caught.

That is exactly my point. The hon. Gentleman is correct to say that it would not apply to motor cars. My argument is that it should not apply to those who work for PC World, Dixons, Currys or anyone else, or people in the second-hand business. If I want to get caught up in the tobacco advertising business and buy second hand from a colleague a computer that is surplus because he uses stuff provided by the House, presumably under the Bill the person who sells me his surplus computer that I subsequently use for that purpose is providing a means of transmission. The hon. Gentleman is right in thinking that that is absurd. That is exactly my point. The clause is absurd and should not be in the Bill.

That is the situation with hardware. I understand my computer and, with my limited knowledge of websites, I know that I need software to make my hardware work. Are we seriously suggesting that everyone working for a software house based in the UK that provides software for my computer will be involved? My knowledge is limited, but I get the impression that many items of software are of a general nature. It is not as if one can go into a shop and say, ''I want to buy software that will do only this.'' A range of software will enable one to access all sorts of information.

Unless the Bill is amended, every person involved in the software business will be guilty of

''providing the means of transmission.''

I hope that the Minister acknowledges that that is absurd and does something about it. The Bill catches all the shop assistants in PC World, Dixons and Currys, and all those who work in software houses. We are doing well.

I tend to use mail order to buy IT equipment, whether software or computers. I place my order, and for as long as Consignia still exists and is willing to deliver packages, it will bring me my goods. Presumably, everyone involved in the delivery of my package, including the freight forwarding business that collects the computer from PC World and delivers it to my house, will also be

''participating in . . . providing the means of transmission.''

The Bill has managed to catch all those people as well. We are doing well.

I tend to use my credit card to make purchases. I buy computers and software by using my Visa or MasterCard. Therefore, those companies are funding

the purchase. People in the banking and credit card industry are making it possible for me to buy IT goods, so they are also

''participating in . . . providing the means of transmission''

because they have made the money available for me. Those working in Dixons, Currys, PC World, the Post Office or Consignia, lorry drivers and the entire banking industry are caught by the Bill.

Mike Hall (Labour, Weaver Vale)

Utter rubbish.

David Wilshire (Conservative, Spelthorne)

The hon. Gentleman is correct. It is utter rubbish.

Mike Hall (Labour, Weaver Vale)

The clause provides ''causes''.

David Wilshire (Conservative, Spelthorne)

The clause is the cause of this rubbish.

Sir David Amess (Conservative, Southend West)

Order. If hon. Members catch my eye, I will consider calling them, but sedentary interventions are not allowed.

David Wilshire (Conservative, Spelthorne)

I am grateful for your defence, Mr. Amess, because I occasionally need it.

Members are becoming excited by the absurdity of my argument. However, my argument would not be possible without the absurdity of the clause. After I have finished explaining who else will be caught and will become a criminal as a result of the clause, the hon. Member for Weaver Vale (Mr. Hall) will presumably leap to his feet to tell the Committee that he agrees with me, and that he thinks that the Bill, as drafted, is wrong. Many people will agree with the purpose of the Bill, but it is the means by which we achieve the purpose that matters. As I said during the first sitting, I make no apology for giving the Bill detailed scrutiny—that is why we are here.

Having made criminals of PC World, Dixons, Currys, the people who work in software houses, and those in the delivery and banking industries, I finally have my illegal goods. Although there may be an alternative method, all the computers that I have ever seen rely on telephone lines of some sort. I do not know which company owns what telephone lines or who provides the service. Before long, all those providing telephone lines will become criminals because they are

''providing the means of transmission''.

We are doing well. Currys, Dixons, PC World, lorry drivers, the Post Office, the banking and credit card industries and now the telephone industry are all caught by the Bill. Absurdity is piled upon absurdity. Whether we like it or not, all those people

''participate in . . . providing the means of transmission''

of illegal advertisements. That is what the Bill says, and if hon. Members look incredulous, they should have read the Bill before listening to the argument.

We could go beyond telephone companies. The manufacturing industry makes telephone lines and other equipment, including plugs and sockets. Before we have finished, the clause is likely to make criminals of the entire population of the United Kingdom.

Jim Murphy (Labour, East Renfrewshire)

I am listening, as usual, to the hon. Gentleman's points, although I do not agree with him. He mentioned hon. Members not having read the entire Bill. Did his casual perusal of it

extend to clause 5(5)(a) on page 3, which directly refutes every word that he said? It states that the person

''was unaware that what he distributed or caused to be distributed was, or contained, a tobacco advertisement''.

I am certain that that should allay the hon. Gentleman's fears, and would reassure computer sales people at Dixons and PC World, and others, such as those who work for internet providers, that they would not be caught, whether intentionally or otherwise, in the way that the hon. Gentleman has mischievously suggested.

David Wilshire (Conservative, Spelthorne)

The hon. Gentleman disappoints me. I thought that he would say that if England had home rule, we could duck behind what Scottish home rule might say, and he could do what he wants in Scotland.

The hon. Gentleman anticipates a point that I shall make later. I have read the Bill and I am aware of what clause 5 provides.

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

Will the hon. Gentleman concede—as gracefully as he can—that my hon. Friend the Member for Eastwood (Mr. Murphy) has shot comprehensively his electronic fox? Will he move his argument on? If not, we shall make criminals, according to him, of those who power communication lines, dig coal and import oil? He is making an interesting and colourful argument, but will he move on?

David Wilshire (Conservative, Spelthorne)

I hear what the hon. Gentleman says. I sailed close to the wind by mentioning home rule for England. I would be sailing even closer to the wind if I discussed fox hunting, although I would love to have that debate with him.

The hon. Gentleman made a serious mistake. I had overlooked the oil industry, the coal industry and the transmission industry. However, he is absolutely right. Any person in the middle east or Alaska—[Interruption.] This will teach the hon. Gentleman not to interrupt and give me more examples of the Bill's absurdity.

Sir David Amess (Conservative, Southend West)

Order. I ask the hon. Gentleman to draw his remarks more closely to the amendment. His argument is becoming dangerously close to repetition.

David Wilshire (Conservative, Spelthorne)

I understand what you say, Mr. Amess, but the repetition is not my fault. The hon. Member for North-West Leicestershire (David Taylor) stoked me up to go round the same course again. In deference to your ruling, I shall explore other issues. However, we might have to return to a discussion of those who work for Dixons, PC World, Homebase and any other company that we want to mention.

I have read clause 5, and I have argued in other Committees that such a way of writing legislation is crass. Clause 2 is titled ''Prohibition of tobacco advertising'', and it sets out what is prohibited, what is an offence and those who would be guilty of committing an offence. I shall not repeat my point about those who work for PC World, Dixons and Currys, or you will get very upset, Mr. Amess. However, if one turns over to the wonderful clause 5, which was anticipated by the hon. Member for

Eastwood, it contradicts the statements in clause 2. That is an idiot's way of writing legislation. [Interruption.] I said at the beginning of our first sitting that it would not be difficult to improve the quality of some of my contributions. If the Bill is idiotic, it follows that anyone who speaks to it will sound idiotic. It is the Bill that is the cause of that problem.

It is simple that when I pick up the Bill, after it is enacted, and it says that I am a criminal if I am involved in the means of distributing advertisements, it should say that I would be a criminal ''unless'' certain things happen. The Minister should deal with that matter. It should not be left until pages later, under a separate clause, because we are debating clause 2. I accept the suggestion made by the hon. Member for Eastwood, because it makes my point and I am sure that when I finally sit down, he will leap to his feet and agree with me. It would be simpler to say that a person is a criminal, unless there are other factors. That would be better than saying, ''You are a criminal'' and then qualifying that statement in a clause that we cannot discuss now because it has not yet been called for debate. Perhaps some staff at PC World, Dixons, Currys and other companies should or should not be caught, but we cannot debate that now.

Sir David Amess (Conservative, Southend West)

Order. The hon. Member has anticipated what I was about to say. For the final time, he must direct his remarks carefully at the amendments and not participate in a clause stand part debate.

David Wilshire (Conservative, Spelthorne)

I do not think that I was participating in a clause stand part debate.

Sir David Amess (Conservative, Southend West)

Order. The Chairman will decide that.

David Wilshire (Conservative, Spelthorne)

I respect that decision. I want to put on the record, however, that when we debate clause 5, I hope that issues connected with clause 2 will not be ruled out of order. You have properly said, Mr. Amess, that when debating clause 2, I may not debate clause 5. When we reach clause 5, I hope that nobody will say that I cannot return to clause 2. It is an absurdity of the way in which the legislation is drafted that a person who participates in the means of transmission is guilty of an offence. That is all that we may discuss now. Later, in a separate debate, we shall say that that is not true.

I do not understand how legal draftsmen can create such a situation, or why Standing Orders say that, because two clauses are linked, they cannot be discussed together. It makes for sloppy consideration of sloppy draftsmanship, and that results in a sloppy Act of Parliament.

Clause 2(4) raises an issue that is not covered by amendment No. 19. I hope that there will be an opportunity, at least under the stand part debate, for that narrow point to be discussed. The amendment offers the Minister the solution to the absurdity of not including the word ''knowingly'' in the clause. In respect of the staff of PC World, Dixons, Currys, the

Post Office and the oil industry—there are others that I will not mention because it may be repetitious—if the word ''knowingly'' is inserted—[Interruption].

Labour Members are becoming restive, because a valid point that they wish to conceal has been raised. The solution to their problem—the way in which they can lower their blood pressure and make progress—is to look at amendment No. 19 and acknowledge that people are guilty of an offence only if they know what they are doing. Surely that is the practical, common-sense solution to the absurdities that I have mentioned.

If a person working for PC World—or for a different company, because I have nothing against PC World—sold a product that was used subsequently for a criminal activity, it would be up to the courts to satisfy a judge and jury that the member of staff knew that the product would be used for that purpose.

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

Surely, the parallel to what the hon. Gentleman has said is that a person could be accused of being terminally boring, unless what they were saying was relevant, interesting and concise?

David Wilshire (Conservative, Spelthorne)

If the hon. Gentleman could demonstrate that I was knowingly terminally boring, that might be a different matter. I am raising points that have to be considered in a forum in which Labour Members do not want to bother to scrutinise or listen; they want to go back downstairs and do something else, such as open their post. Therefore, they are at fault, and the public will draw the conclusion that this is not intended to be a forum where proper scrutiny takes place.

Judy Mallaber (Labour, Amber Valley)

The hon. Gentleman has been an hon. Member of this House for far longer than I, but it is my understanding that in most legislation the main principles are set out at the beginning of the Bill and further explanations are given in subsequent clauses. That is a normal method of parliamentary draftsmanship. I am sure that when we move on to the subsequent clause, he will let us know whether he thinks it clearly explains that it excludes all the people that he was worried might be caught.

Mr. Wilshire rose—

Sir David Amess (Conservative, Southend West)

Order. The hon. Gentleman must take care to remark only on the amendments.

David Wilshire (Conservative, Spelthorne)

I was talking about amendment No. 19 and I was doing so knowingly.

The hon. Member for Amber Valley (Judy Mallaber) said that I have been an hon. Member of this House for a long time. She is right; I have been here for 15 years. If the hon. Lady looks at my parliamentary record, she will see that I have been on the Back Benches for most of that time. That is because throughout my career I have spoken up about the absurdity of most draftsmanship.

Sir David Amess (Conservative, Southend West)

Order. I must now ask the hon. Gentleman to resume his seat.

Yvette Cooper (Labour, Pontefract and Castleford)

The amendments before us are Nos. 3 and 19. The hon. Member for East Worthing

and Shoreham set out the intentions behind the amendments. In the context of those comments, I assure him that they are unnecessary. He said that he wanted the Bill to limit its attentions to those people who have some control over the situation, and, in effect, that is what it does.

The Bill is intended to treat print and electronic media in the same way, as fairly as possible, and in a manner that anticipates future technological developments. The Bill sets out a comprehensive ban and then it sets out defences. That has been made clear in the discussions that we have had in the Committee and in those that took place while the Bill was being drafted.

As the hon. Member for Edinburgh, West (John Barrett) explained, defences against the offence that is set out in clause 2 (3) are described in clause 5 (5). It states that a person does not commit an offence under section 2(2) and 2 (3) if,

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

(b) having become aware of it, it was not reasonably practicable for him to prevent its further distribution, or

(c) he did not carry on business in the United Kingdom at the relevant time.''

Therefore, amendment No. 19, which would add the word ''knowingly'', is irrelevant, because clause 5(5)(a) sets out a defence for a person who was ''unaware''—that is, a person who did not know.

David Wilshire (Conservative, Spelthorne)

I am curious about why the Minister thinks that it is possible to refer to clause 5 in her explanation of why what we are saying about clause 2 is not right, because I was told that that was not possible.

Yvette Cooper (Labour, Pontefract and Castleford)

It appears that the hon. Gentleman's main objection is that the ban is set out on page 1 and the defence on page 3. This is a Bill. It is a single Bill; pages 1 and 3 are part of the same Bill. As my hon. Friend the Member for Amber Valley said, it is common for a Bill to set out an offence and subsequently to set out defences against it. The amendment to clause 2 is irrelevant because of the defence set out in clause 5 (5).

The hon. Member for Spelthorne (Mr. Wilshire) seems to be concerned only with the way in which the Bill is set out. I shall, of course, pass on to the parliamentary draftsman his wish that all its provisions should be set out on the same page, if possible, to make it easier for him to read the contents in the right order. However, I am not sure how seriously the parliamentary draftsman will take the hon. Gentleman's argument.

The hon. Gentleman went into a long diatribe about PC World, Dixons and so on. Goodness only knows how he can believe that it is reasonably practicable for the staff at Dixons to climb into his bedroom window and repossess his computer, having derived through the ether that he was using it for a tobacco advertisement. Clearly, the amendments are unnecessary. There are strong defences in the Bill for people who are unaware of—or for those whom it is not reasonably practicable for them to prevent—the distribution of an advertisement.

Tim Loughton (Conservative, East Worthing and Shoreham)

We had an interesting debate, even if it were abruptly cut off by your good self, Mr. Amess.

David Wilshire (Conservative, Spelthorne)

I was only on the introduction.

Tim Loughton (Conservative, East Worthing and Shoreham)

My hon. Friend was just beginning his warm-up routine, but I am sure that we shall enjoy more of his words of wisdom later in our proceedings. I defy Labour Members to accuse my hon. Friend of being terminally boring. On the contrary, he provoked more contributions from those on the Labour Benches than during our entire sitting on Tuesday. He certainly succeeded in waking up many of them. I look forward to better debates that involve more members of the Committee.

The Minister's argument was reasonable. I concentrated particularly on transmission personnel, especially those in telecommunication companies along whose wires the advertisements transmit. My hon. Friend the Member for Spelthorne is right: theoretically the way in which the Bill is drafted—as with so much legislation—means that it could take in more people. The Minister is happy that there are sufficient defences in the Bill. She has laid out her case explicitly and said that the other loosely related people will not be caught by it. I am grateful for her assurances and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

David Ruffley (Conservative, Bury St Edmunds)

I beg to move amendment No. 4, in page 1, line 17, leave out

'who does not carry on business'

and insert

'whose place of establishment is not'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to take the following amendments: No. 5, in clause 5, page 3, line 21, leave out

'he did not carry on business'

and insert

'the place of establishment of his business was not'.

No. 6, in clause 8, page 4, line 14, leave out

'who does not carry on business'

and insert

'whose place of establishment is not'.

David Ruffley (Conservative, Bury St Edmunds)

I declare a non-remunerated interest as a member of the Lords and Commons Pipe and Cigar Smokers Club. I draw attention to subsection (4). It states that it is not an offence

''for a person who does not carry on business in the United Kingdom to publish or cause to be published a tobacco advertisement by means of a website which is accessed in the United Kingdom''.

It is also not an offence under the clause to devise that website. In other words, it is an offence to publish or cause to publish an advertisement on a website if the publisher carries on business in the United Kingdom, and that is at the heart of the amendment.

Labour Members may argue that clause 4(3) provides some exclusion from, or moderates the thrust of, clause 2(4). However, that is only a potential exclusion. Clause 4(3) states that if a provider ''complies with'' within certain

''regulations'', they do not necessarily fall foul of clause 2. The problem that we Opposition Members have is that, to the best of my knowledge and belief, those regulations have not been made available to the Committee. It is difficult to know whether anyone caught by clause 2(4) could take advantage of clause 4(3).

None the less, website tobacco advertising published by a person carrying on

''business in the United Kingdom''

will be regulated one way or the other, whereas website advertising published by a person

''who does not carry on business in the United Kingdom''

will be unregulated, or subject to regulations in another country. That logically follows from the drafting of the Bill.

The amendment draws important attention to the crucial definition of the term ''carry on business''. Amendments Nos. 4 and 5 are probing amendments and I shall explain why in some detail. The provisions of clause 2 are intended to make it clear that the Bill does not have extraterritorial effect—we understand that that is what the draftsmen were driving at. The clause covers the originator of a website and people involved in the distribution or transmission of tobacco advertisements by electronic means. In other words, it will cover primarily information society service providers. That makes the e-commerce directive—directive 2000/31/EC—and the terms in which the UK intends to transpose that directive into UK domestic law, particularly relevant to the clause.

Throughout the passage of this Bill, and that of its predecessor in the previous Parliament, the Government have properly undertaken to make the provisions consistent with the e-commerce directive. EU member states adopted that directive in summer 2000. Its purpose is to facilitate commerce over the internet. It should have been implemented by 17 January 2002, but the UK is not the only member state that has found it impossible to meet that date.

Under article 3 of the directive, those who trade on the internet are obliged to comply only with the laws of the member states in which they are established, not those of the states in which they are carrying on business. A member state cannot impose further regulations on an organisation's activities if that organisation is established in another member state. The Bill, however, purports to restrict internet advertising of tobacco from being used by anyone who is found to

''carry on business in the United Kingdom''.

Clearly, it is a logical and practical possibility that such a person could have a place of establishment in a member state where tobacco advertising on the internet is permitted, at least until a new tobacco advertising directive bites on that country's domestic law. In sum, we tabled amendments Nos. 4 and 5 to clause 2(4) because if the amendments are not accepted, there is a clear

possibility that the Bill will be inconsistent with the EU directive. I understand that draft regulations that would introduce the directive into United Kingdom domestic law were published for consultation, and that the closing date for representations was 2 May. Our amendment is probing and asks the Minister a question. Is she satisfied that subsection (4) is consistent with the e-commerce regulations—I do not know whether it is consistent with the directive—that will be introduced by Her Majesty's Government in this country?

Will the Minister remind the Committee, in as much detail as she deems necessary, about the status of the regulations and tell us how the language in them meshes with the EU directive? That would help all people concerned; those of us who do not want unnecessary litigation to occur under the Bill, those of us who are keen for the Bill to be improved and the judges who will need to understand clearly what the Minister is driving at.

I am sure that the Committee will want to be entirely satisfied that the phrase

''who does not carry on business in the United Kingdom''

is entirely consistent with the directive and regulations. I hope that I have made that clear. The Government explained their use of the phrase ''carry on business'', rather than the word ''establishment'' to which the directive draws attention. Does that mean that there would be an actual presence? The legal sense in which the Minister wishes to define

''carry on business in the United Kingdom''

is unclear.

Depending on individual cases, courts would have different interpretations about what the phrase could mean. Let us consider a branch office that no one works in, but that has a name plate. That company would be registered in this country but would have no filed accounts or any details more than a pro forma for a company with a brass plate on its door.

I do not want to turn the debate into a party political bun fight. It would be churlish and unfair to remind the Committee about the definitions of a place of business to which No. 10 and the Prime Minister resorted when deciding whether Mittal had a place of business in this country and whether that was an English company. Let us pass over that. It is safe to say that there is legitimate debate on, and legal interest in, the matter. Lawyers will read avidly the Committee's proceedings in Hansard, and I know that they are searching for enlightenment on the meanings of ''establishment'' and ''carry on business''.

Tim Loughton (Conservative, East Worthing and Shoreham)

I am following my hon. Friend's argument closely. He said that the Government have interpreted

''carry on business in the United Kingdom''

as meaning a presence. He and I have served on Committees that considered Finance Bills during which new tax regulations had different definitions that meant that the Treasury treated the definition of

people who carry on business in the United Kingdom differently from that under the Bill, which provides further analogies.

David Ruffley (Conservative, Bury St Edmunds)

My hon. Friend is entirely right. He has high-level experience of financial matters and corporate law, which I think that I do as well. The Minister owes a duty to not only Opposition Members but to those who will examine how the Bill will be viewed by the courts should a case be brought and a prosecution be made under it, should it pass into law.

It is incumbent on the Minister to explain the selection of meanings, perhaps by adverting to how the Inland Revenue defines carrying on business, as my hon. Friend said. Does it import concepts of domicile? What does presence mean? Are there tax law precedents that the court should use in defining and amplifying the meaning of carrying on business in the UK? Is there some other test? Would an agent office with a nameplate that has no employees in this country but that has a registered office and a company number at Companies House in the City count as carrying on business in the UK? I look forward to a detailed, thorough and careful explanation of the legal usages that legal advisers have given Ministers when Ministers put their name to the clause and approved the drafting. It needs clearing up.

The draft regulations to which I referred earlier, which will introduce into UK domestic law the terms of the e-commerce directive, are confused vis-à-vis the directive, not the clause. I hope that I have exposed the potential conflict in the clause, but what about the regulations vis-à-vis the directive?

The draft regulations state that

''the presence and use of the technical means and technologies required to provide the service do not, in themselves, constitute an establishment of the provider''.

The directive does not use that language. Will the Minister explain that apparent contradiction?

I hope that the Minister will consider our concerns. Opposition Members want legislation that is clear, does not lead to unnecessary litigation and gives certainty not only to those who want to comply with it, but to the courts that may have to decide cases that fall to them for decision involving those who fall foul of the Bill. If she cannot explain the posers and answer my questions, I expect her to return with a suitable amendment to clear up what seems to be a large mess.

John Barrett (Liberal Democrat, Edinburgh West)

There has been much debate about the difference between carrying on a business and a place of establishment. As a non-lawyer, I assume that the definition of carrying on a business is fairly simple and understandable. It is more complicated to define a place of establishment, and I look forward to the Minister's assurance that the definition of carrying on business is the better definition.

As was said in another place, the country of origin as set out in the e-commerce directive is more precisely dealt with if the business is defined by the place where the business has been carried on, rather than the place of establishment. It would be simple for a company to

brass-plate an office in another country and say that it was established there.

Yvette Cooper (Labour, Pontefract and Castleford)

Hon. Members have made important points about the amendments. The Bill must be in line with the e-commerce directive, and it will be in line with it. However, although consultation on the e-commerce directive has closed, final decisions have not yet been taken. Therefore, with regard to the application of the Bill, we will need to take account of the final wording of the e-commerce directive.

The Bill is in line with the principles behind the e-commerce directive. It addresses the fact that we are regulating a complicated area. With regard to the internet, technology is developing fast and many new questions about the international application of legislation are raised. The Bill has been drafted so that it does not have extra-territorial effect. That is why it states that it applies only to those who carry on business in the UK. Clause 2 (4) states:

''It is not an offence . . . for a person who does not carry on business in the United Kingdom to publish or cause to be published a tobacco advertisement by means of a website''.

Discussions have taken place about what that means. If a company is carrying on business in this country—if it has a branch here and it is operating in this country—it would be covered by the Bill. On the other hand, if, for example, a Japanese tobacco company that is based entirely in Japan were to sell its products to the UK over the internet, that would probably not be interpreted as carrying on business in the UK.

David Ruffley (Conservative, Bury St Edmunds)

I am glad that the Minister acknowledges that the points that have been raised are important. However, I have not heard an answer to my question: would a company that is registered in this country, but does not file accounts and merely has a brass plate on a door somewhere—in Birmingham, for example—constitute an organisation carrying on business?

Yvette Cooper (Labour, Pontefract and Castleford)

That would probably depend on whether the brass plate referred to anything. A brass plate swinging in the middle of nowhere is different from a brass plate on a door that opens on to a substantial business, or from a brass plate on a door behind which several people are carrying on business in this country.

David Ruffley (Conservative, Bury St Edmunds)

I offer the example of a company that has no employees and is registered in this country—it has a company number at Companies House—and a website is registered under its name. The Minister used the term ''a substantial business''; I did not say that. With regard to the scenario that I have outlined, is there any way that that organisation, that does not file accounts and has no employees, would be carrying on business in this country?

Yvette Cooper (Labour, Pontefract and Castleford)

In the end, the courts must decide what they regard as carrying on business. In the past, the courts have held that a person who carries on a business where there is a branch only here is carrying on business in this country. In the end, the courts must decide whether business is taking place: however, that requires having a presence in this country.

The key issue that the amendments address is the proposed legislation's compatibility with the e-commerce directive. When the final decisions are taken about that directive, we will need to ensure that the Bill is in line with it—especially where it addresses matters with EU scope. If necessary, we will do that on Report.

David Ruffley (Conservative, Bury St Edmunds)

I was pleased that the Minister thought that there was something in these amendments. New Labour Ministers are not always so gracious when serious points of principle are put to them, so I am grateful to her. However, I did not hear her give any explanation of the word ''establishment'', which seems to be flavour of the month in the EU directive and is referred to in regulations. The phrase used in the clause is ''carry on business''. I regret to say that the Minister has not yet given any explanation for that, and I hope that she will give us a detailed one, so that when courts try to determine the intention of Parliament, they will get some informal guidance on what is going on.

Perhaps the hon. Lady would care to take this opportunity to explain how the concept of ''establishment'' in law may be interpreted differently from ''carry on business''? Does she think that those concepts are identical? If she does, she should say so, because it would be helpful to everyone. If she thinks that there is a difference in practice or in the way that courts may interpret those phrases in practice, she should explain what it is. It would help all hon. Members if the Minister would give an explanation of ''establishment''. What legal advice has she received from officials in the Department as to its meaning and how, whether or if it differs from the meaning of ''carry on business''?

It is important to have such information on the record. The Minister will not be cheering up only me by responding more fully to the questions that I have legitimately asked; she will also cheer up the many observers who wish nothing more than to understand whether they could potentially be caught by this legislation. In the light of that, a legal explanation of ''establishment'' and how the Minister thinks and expects the courts to interpret it, compared with ''carry on business'', would be useful. Opposition Members would like to hear more about such a crucial distinction, if distinction there be.

Yvette Cooper (Labour, Pontefract and Castleford)

The advice on ''place of establishment'' has been set out as part of the consultation on the e-commerce directive. At present, we do not propose to use the phrase in the Bill. The phrase in the Bill is ''carry on business'', and there has been considerable discussion in the House and in the other place as to how that phrase may be interpreted. Of course, in the end, that is a matter for the courts.

As I said, once the e-commerce directive is published, we must ensure that it is compatible, but at this stage it would be premature to speculate whether further action will be necessary. Certainly,

''carry on business'' is perfectly compatible with the principles behind the e-commerce directive. The points made by the hon. Gentleman are speculative.

David Ruffley (Conservative, Bury St Edmunds)

This will not do. I do not know why the Minister says that the arguments have already been exposed. They have not been exposed or debated in this Committee, or debated in any sensible or meaningful detail on Second Reading. For her to say that she thinks that the phrase will be compatible is not sufficient. She referred to regulations when she argued that the meaning of ''establishment'' has been teased out and set out. I am asking only that the Minister takes time—it need not detain the Committee long—to explain the legal definitions of ''establishment'' and how, if at all, they contrast with ''carry on business.

Most importantly, will the Minister describe—not speculate—why the words ''carry on business'' have been used in the drafting of the Bill rather than ''establishment''. Why is there a disjunction? Why is there a different use of language? It looks like an error—someone has made a slip. An explanation would be hugely helpful to the Committee.

Yvette Cooper (Labour, Pontefract and Castleford)

The phrase ''carry on business'' was in the Bill that was discussed this time last year and it was passed through the other place. The phrase has been discussed extensively and its meaning—as set out earlier by the hon. Member for Edinburgh, West—seems clear. The ''Official Journal of the European Communities'' of 17 July 2000 explains the meaning of ''place of establishment''. If members of the Committee are interested, I am happy to read the relevant passage. It is referred to as L 178/4 and states:

''The place at which a service provider is established should be determined in conformity with the case-law of the Court of Justice according to which the concept of establishment involves the actual pursuit of an economic activity through a fixed establishment for an indefinite period''.

For hon. Gentlemen who are interested in the phrases used in the e-commerce directive, that is where they should look.

The Tobacco Advertising and Promotion Bill contains the phrase ''carry on business'' because that is a clear exposition of the types of businesses that we want to be covered by the tobacco advertising ban. Businesses outside the United Kingdom are excluded from the Bill, and rightly so, because we cannot enforce the law against them. The wording is sensible. As I have said, we shall, in due course, consider the final decisions that are made about the e-commerce directive.

David Ruffley (Conservative, Bury St Edmunds)

The Minister's explanation started well, but then trailed away. We wanted a description of ''establishment'' put on the record, so that those who will be responsible for implementing the law will be clearer about ministerial intent. In the light of a series of inadequate responses—and some disdain for important technical questions that require a certain knowledge of law and decent legal advice—I shall have to press the amendment to a Division.

Question put, That the amendment be made:—

The Committee divided: Ayes 4, Noes 16.

David Wilshire (Conservative, Spelthorne)

I want to explore three issues with the Minister, mainly to obtain clarification. They all are serious points. By using the phrase

''in the course of business''

in subsections (1) and (2), there is a possibility that the Government are providing a loophole whereby people could say that an advert is not published in the course of business.

It may sound spurious, but I suspect that when the Bill becomes an Act of Parliament, people who feel strongly that their rights have been offended may be prepared—as a matter of principle, and not to make a profit or to help the tobacco industry—to take it upon themselves to say that they do not approve of being told that there cannot be advertisements for something legal. I do not want to rehearse that argument, but that is a well-trodden path. There are people who feel strongly about the issue, and they will not go away—nor, I suspect, will their sense of injustice.

If I understand clause 2 correctly, someone who publishes an advertisement not

''in the course of business''

but for some other reason will still be able to do so. I should be grateful if the Minister would clear that matter up, because if I am right, the clause provides a loophole that people can exploit. It is probably not beyond the wit of mankind for someone who publishes an advertisement to claim not to do so—or to actually not do so—in the course of business, or a person could publish an advertisement in such a way that the courts could not prove that it was done in the course of business. As I said on Tuesday, I am not sure why I feel moved on occasion to try to help the Government with the Bill.

The second relevant issue is that subsection (1) says:

''published . . . in the United Kingdom''.

However, subsection (2) mentions producing something that is published in the UK. It would be helpful if the Minister would say for the record what definition of the word ''published'' is being used, as there is a range of definitions. I do not want to repeat our debate about natural meanings, but we should be clear what the word means. We will have to return to the issue.

I appreciate the difficulties of jumping from clause to clause, but clause 4(1)(c) refers to in-flight

magazines. The term

''published . . . in the United Kingdom''

then becomes highly relevant. I am flagging-up the general definition of ''published'' so that when we talk about aircraft coming in and out of the country, we can compare that definition with how the word is used.

I promise that I shall go down this route only this once, but the definition of ''published'' could apply to advertisements in the in-flight magazine of a British airline flying out of the country and not to those of a foreign airline coming in. That is a serious issue to be discussed later and that is why I would like to get the definition of ''publication'' into the record.

Kelvin Hopkins (Labour, Luton North)

I am always suspicious when hon. Members start to debate the meaning of words and phrases. Not only are there obvious, standard dictionary definitions, but there are also meanings in legislation. Terms such as ''published'' have been used in innumerable Acts. There are accepted understandings and definitions of what such words mean. Surely it is a waste of time to debate continually the meaning of words.

David Wilshire (Conservative, Spelthorne)

I understand the hon. Gentleman's point. I do, on occasion, provoke interventions of that sort, because people feel a bit sore about being kept in Committee. However, as will become clear when we discuss another clause, there are assorted legal rulings, definitions and intentions behind the word ''published''. I am sure that the hon. Gentleman knows that. I am not being pedantic. I assure the Committee that the clause raises an issue for the aviation industry, and the reason I speak about that is because parts of Heathrow are in my constituency. There are serious financial implications for British business, namely British airlines, in relation to other people, depending on what we mean by publish. It is important, not for a pedantic reason, but for the sake of the record, to make clear now what this Bill means in general terms by the word ''published'', because clause 4 raises issues about exceptions to that.

Tim Loughton (Conservative, East Worthing and Shoreham)

In response to the answer that my hon. Friend is giving to the hon. Member for Luton, North (Mr. Hopkins), we have already had an example this morning of where publication in such a context can be taken to mean two quite different things. That was over the EU directive on internet service providers and what constitutes publication or a publisher, as opposed to a conduit. There are already very different definitions there. It is absolutely essential, as my hon. Friend is trying to make clear, that, for the benefit of the whole Committee, we define at this stage exactly what is meant by publishing. That can be interpreted very differently, in different contexts relevant to the Bill.

David Wilshire (Conservative, Spelthorne)

I am grateful to my hon. Friend. I hope that the Minister can clear up this serious issue—I shall wait for her reply.

Another concern is raised by the phrase

''published, in the United Kingdom'',

also in subsection (1). What does the hon. Lady mean by that? I am not just raising pedantic points. That follows from the same concern that I have expressed, which we shall debate again when we discuss in-flight magazines. The phrase ''in the United Kingdom'' is not as straightforward as it sounds. Does an airline coming in briefly and then going out again constitute publishing in the United Kingdom, or just appearing here and going away? Does bringing something in and taking it out involve it being published here?

Much more to the point, can the Minister say whether she means to include British airspace in the United Kingdom? Under some legislation, offences that take place in British airspace are held to be taking place in the United Kingdom—they do not necessarily have to be on the ground. If publishing ''in the United Kingdom'' means flying over the UK in British airspace but not landing here, I hope that the hon. Member for Luton, North and others can see the difficulties that we will have under clause 4. If we can clear up what the Minister means by ''in the United Kingdom'' at this point, it would be helpful.

Tim Loughton (Conservative, East Worthing and Shoreham)

Sea space is also a consideration. My hon. Friend's argument is relevant to duty free and, for example, the sale of goods on cross-channel ferries. Strictly speaking, those never touch land but are in British territorial waters.

David Wilshire (Conservative, Spelthorne)

Exactly so. My hon. Friend makes one of the points that I was going to make, so I shall not repeat it. The same arguments need to be explored for coach operators that come in from the continent, or for our coach operators that go out, pick up literature not published in the UK, and bring it back. Again, what do we mean by ''published'' and ''in the United Kingdom''?

Clause 2(4), which begins:

''It is not an offence under subsection (1) for a person'',

raises several questions for which I should be grateful for an explanation. In a previous debate, I was told that clause 2 sets out the offences and that the defences are further on in the Bill. However, clause 2(4) contains an exception to an offence. It has been argued that it is normal to say that here is the offence and that, if we turn the pages, we will see the defences. That is not the case in clause 2(4). Why is that so? Why do we have drafting that sometimes says one thing and sometimes another? That rather plays into my argument that everything should be in the same clause, so that someone reading what the offence is also knows what the defences and the exceptions are, all in one go.

I will be grateful if the Minister will tell us why that provision is necessary. I think that it says that if somebody does not carry on business here and is doing something for somebody abroad, then that is not an offence. It seems that someone who is outside British jurisdiction and who is not a British subject is being legislated for, even though we have no control over such a person. Why do we need to exclude such people in a British Act of Parliament when we cannot include

them in the first place? I suspect that I will get an answer to that question.

There is another possible loophole. I shall give an example. I could live here but carry on my business abroad. Everything relating to the business would be over there—the printing and publishing companies and the tobacco business—but I might happen to live here. I would be made an exception of because I could do everything—devising, designing and sorting out the IT-side of advertisements—and would have the defence in law that the business was carried on elsewhere. We will create two sorts of graphic designer: those who commit an offence if they do something for a British company and those who do not if they carry on business abroad, even if it is for themselves. That does not seem to be sensible legislation.

I hope that the Minister can say that I have misunderstood, but if I have not, I shall worry about that second loophole. I hope that my arguments are valid and that she has an answer. I shall listen with care and I may come back if I am not satisfied.

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

I want to make a brief point and, as usual, I should like to be helpful to the Government.

I spoke on Second Reading of my concerns about the uptake of tobacco smoking by young people and about the possible existence of a loophole under clause 2(4). I gave the Bill a broad welcome, with the exception of that subsection. Young people have wider access to and a greater interest in the internet and they are possibly more susceptible to the material on it. Is the Minister convinced that the power provided for in clause 7—I know that we are not discussing that yet, but at certain points clause 2(4) and clause 7 must be debated together—is sufficient to close any loophole that might exist in 2(4)? Clause 7 refers to developments in technology. However, the hoary old established technology already allows the decamping abroad of tobacco promotion to internet service providers, which may well be producing material and ''come-ons'' outside the United Kingdom for the younger section of our population. Will clause 7 be sufficient in its power and scope to cover that loophole? Perhaps my hon. Friend will tell us when we reach the clause 7 debate.

In the 1999 World Bank report, the American researchers Saffer and Chaloupka contributed some common sense that is now writ into advertising language:

''A limited set of advertising bans will not reduce the total level of advertising expenditure but will simply result in substitution to the remaining non-banned media.''

It is as likely as night following day that the promotion activities of tobacco companies will decamp abroad. Furthermore, because of their acknowledged focus on recruiting new smokers, who will tend to be young people who are more likely to be internet aware, such activities will lead inexorably to the e-mail accounts of young people receiving unsolicited junk e-mails—spam—that are in some indirect way linked to the promotion of tobacco. Is my hon. Friend convinced that clause 7 will close off the apparent loophole in clause 2(4)?

Yvette Cooper (Labour, Pontefract and Castleford)

I shall deal with the points that have been made. The clause creates a new offence related to tobacco advertisements. Essentially, it says that anyone involved in the publication, printing, devising or distribution of a tobacco advertisement is guilty of an offence, unless they have a defence as set out later in the Bill. It is right to have such a wide-ranging offence. Anyone knowingly involved with a tobacco advertisement may be liable and later clauses create defences for those whose involvement in the chain should not be penalised.

The first question was about offences applying only in the course of a business. That is right because the Bill is not about preventing members of the public, journalists, writers or others talking about tobacco products, representing them on stage or film or commenting in the press about smoking and tobacco. It does not prevent someone drawing up a poster that says, ''I love cigarettes'' and putting it in their window, if it is not done in the course of a business. It is right that they should be able to do that, because they have a right of free speech and free expression. If they are paid to do so—if it is done in the course of a business or through sponsorship—that is covered by the Bill. The Bill does not affect the free speech of individuals who are not operating in the course of a business, and I believe that that is right. If, however, someone puts in a window an advertisement that has been published by Marlboro—or someone else—after the passage of the Bill, the publishing of the advertisement will be caught under the Bill or, if a company pays for the advertisement to be put in the window, that will be covered by the Bill. If someone is simply putting their views across, they have a right to do so.

In addition, if a journalist chooses to write a news story, that is not an advertisement, but if he is paid by a tobacco company to promote its brand, it would be an advertisement and would be covered by the Bill. It is right that we make such a distinction.

Adrian Flook (Conservative, Taunton)

The Minister mentioned journalists not being paid. At what level would a journalist be remunerated in terms of, for example, soft entertainment?

Yvette Cooper (Labour, Pontefract and Castleford)

Let me try to clarify the matter. I may have slightly confused the two separate distinctions. The first is whether something is done in the course of a business and the second is whether something is an advertisement. A journalist is operating in the course of a business, in that he or she works for a newspaper, but a journalist writing a news story is not writing an advertisement. Such a story would not be covered by the Bill, not because of the

''in the course of a business''

distinction, but because it is not an advertisement. If the journalist is receiving free distribution or sponsorship from a tobacco company as encouragement, that is covered later in the Bill and we will have plenty of opportunity to deal with it in some detail in the discussion on sponsorship and what it means.

Adrian Flook (Conservative, Taunton)

May I give the example of the Cartier polo event, which happens once a year on Smith's lawn? What would the situation be if a journalist had been entertained by Cartier, which makes cigarettes, and referred to the event as one that used to be known as the Cartier polo event?

Yvette Cooper (Labour, Pontefract and Castleford)

I think that it would depend on whether that counted as an advertisement and whether that person was effectively receiving either free distributions, which are covered by clause 9, or sponsorship, which is covered by clause 10.

Adrian Flook (Conservative, Taunton)

That is why I asked my original question. If Cartier invited the journalist to the event that was sponsored by somebody else, but Cartier paid for that and the journalist received free entry, at what level would the journalist receive payment for promoting the event previously known as being run by Cartier polo?

Yvette Cooper (Labour, Pontefract and Castleford)

This becomes complicated because it would depend on the timing of the Bill coming in—I am slightly confused by the hon. Gentleman's hypothetical situation. Clause 9 contains provisions on the prohibition of free distributions and states:

''A person is guilty of an offence if in the course of a business he . . . gives any product or coupon away to the public in the United Kingdom, or . . . causes or permits that to happen, and the purpose or effect of giving the product or coupon away is to promote a tobacco product.''

Clause 10 states:

''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 in the United Kingdom.''

I think that the hon. Gentleman's points relate to the interpretation of sponsorship, and I suggest that we may discuss them at length when we consider clause 10.

Tim Loughton (Conservative, East Worthing and Shoreham)

My hon. Friend the Member for Taunton (Mr. Flook) is making good points that get to the heart of several of the Bill's weaknesses. We are in the realms of discussing infomercials, which are stories written by journalists about the latest tobacco products for newspapers or ''lad's mags''. They may do that without receiving sponsorship from firms. They may be sent samples of cigarettes from several firms, which they can choose to test. In a different capacity, they may attend an event that is sponsored by a tobacco company and enjoy hospitality. That does not constitute sponsorship under the Bill. It is important to know the stage at which the journalist could be guilty of committing an offence unwittingly. We are getting no nearer any definition of that.

Yvette Cooper (Labour, Pontefract and Castleford)

As I said, we will have an extensive opportunity to discuss the extent of sponsorship and circumstances in which sponsorship may be interpreted to apply when we consider clause 10. The hon. Gentleman referred to journalists being sent free cigarettes. As I pointed out, clause 9 provides:

''A person is guilty of an offence if in the course of a business he . . . gives any product or coupon away to the public in the United Kingdom, or . . . permits that to happen, and the purpose or effect of giving the product or coupon away is to promote a tobacco product.''

We will have plenty of opportunities to discuss that. However, I do not think that the point is covered by clause 2 and I want to deal with issues that hon. Gentlemen raised in connection with that clause.

Mr. Wilshire rose—

Sir David Amess (Conservative, Southend West)

Order. Before the hon. Gentleman intervenes, I remind the Committee that we must confine our remarks to clause 2.

David Wilshire (Conservative, Spelthorne)

I am happy to park issues of sponsorship until later. However, my hon. Friend the Member for Taunton made a valid point about the phrase

''in the course of business'',

which is exactly what we are considering.

I would be interested to hear the Minister's response to my hon. Friend's point. It has nothing to do with tobacco sponsorship if Blogg's jelly babies—or whatever company—sponsors a function and free entry to the event is given to a journalist, although the event's previous sponsor promoted tobacco. However, if I understand my hon. Friend correctly, the journalist could write a general report on the event and mention that it used to be sponsored by a certain tobacco company. Is not that the loophole about which we should be worried?

Yvette Cooper (Labour, Pontefract and Castleford)

I do not think that the situation that the hon. Gentleman is describing would count as an advertisement, because it would be a journalist writing about a particular event in the form of a news story, which would not be described as an advertisement. Magazines often make distinctions, such as printing the word ''advertisement'' at the top of a page, so I do not accept that the hon. Gentleman's anxieties are well founded. There is no problem for journalists when describing events that they have attended, so long as they are not sponsored by the tobacco industry to do so. However, we will discuss that when we reach clause 10.

Adrian Flook (Conservative, Taunton)

I apologise to members of the Committee for not mentioning that I have declared an interest in the Register of Members' Interests. The Under-Secretary may be confused by the word ''sponsor''. The clause states:

''A person who is in the course of business publishes a tobacco advertisement, or causes one to be published''.

The journalist is in such a position as a guest of a tobacco company. He would not be under sponsorship but, given that the provision covers an advertisement, it would suppress his freedom of speech.

Yvette Cooper (Labour, Pontefract and Castleford)

I am struggling hard to follow examples of who is sponsoring whom and who is giving money to whom. Clauses 9 and 10 are clear about free distribution and sponsorship, so we will have a great opportunity to discuss what constitutes sponsorship—and what does not—when we reach those clauses. There is no question of journalists' freedom of speech being compromised as long as they are not being sponsored to advertise such products. There is a sensible distinction to be made between advertisements and journalism.

The hon. Member for Spelthorne asked what was meant by ''publish'' and he referred to an airline company. Again, I was not sure whether that was his real worry. A magazine is published. Someone published it. The hon. Gentleman's concern was more about the principal market, the location of the publication and whether it was in the United Kingdom, not the definition of ''publish''.

David Wilshire (Conservative, Spelthorne)

I was determined to put on the record a definition of ''publish''. Its meaning is not self evident. As the Under-Secretary knows, a range of activities are published. I return to the coach operator, coming in and going out. Does the act of bringing in something on the back seat of a coach constitute publishing in the United Kingdom? We need a definition.

Yvette Cooper (Labour, Pontefract and Castleford)

Publication would be here, if the advertisement was shown to people who are here. If the advertisement were available in this country, it would have been published in this country. We have set out defences whether or not the principal market was in other countries and so on. If people brought back a magazine from their holidays in another country and it is lying around the house, surely it would be wrong to expect the company responsible for the advertisement to be penalised for it being in the United Kingdom. Other defences are set out in respect of the principal market. I look forward to having a sensible discussion about the airline industry. The publishing aspect is relatively straightforward. The Bill allows for electronic as well as print publication to anticipate changing technology.

The hon. Member for Wilshire mentioned an interesting issue: people who live here but carry on their business abroad. It is right that, if the business were carried on abroad and the publication of the tobacco advertisement took place abroad, legally, the fact that they lived in the United Kingdom would not mean that they were covered by the Bill. The Bill is about not where people live but the carrying on of business and the publication and distribution of tobacco advertisements. Someone who works for a company in the United States that publishes and distributes tobacco advertisements to the United States population but who lives in the UK and does that work online, for example, or travels to and fro to do it, has a right to do so. We are not penalising people's right to work in different parts of the world or to compete for business in other parts of the world. The Bill is designed to prevent the advertising of tobacco products to people in this country.

My hon. Friend the Member for North-West Leicestershire expressed concern about clause 2(4) and asked whether it created a loophole to exempt people who do not carry on business in the United Kingdom. We must all recognise that the internet and its international nature pose new questions and dilemmas.

We have jurisdiction over only this country. That causes difficulties in dealing with things that are available and legal in other countries but which can be accessed from this country using new technology. We have tried to set out extensively means to prevent that in as many ways as possible for those who carry

on business in this country, in whatever form in the chain.

The Bill is as comprehensive as possible, bearing in mind Parliament's jurisdiction. However, we must recognise that international issues are involved. That is why it is right to work on international agreements on the matter, why we need strongly to support progress in the European Union in setting out an EU-wide tobacco advertising ban, and why we must work with the World Health Organisation for a worldwide framework on tobacco control.

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

I pay tribute to the work that the Minister has done in the field so far. The key and residual thrust of my point, to which the debate on clause 7 may be relevant, relates to the phrase ''technological development'' when pre-existing, old-style, old-hat technology can be used by tobacco-promoting companies decamping abroad. Perhaps that phrase needs some attention, and perhaps I shall table an amendment before we have a chance to discuss it.

Yvette Cooper (Labour, Pontefract and Castleford)

I shall be happy to discuss the issues surrounding clause 7 further. Clause 7 is aimed at new and developing technology. The issue is jurisdiction as much as technology. My hon. Friend is right to say that the technology already exists to obtain information and access to things abroad. The issue with which we are grappling in Committee and in Parliament is jurisdiction, where we can enforce laws and who we can enforce them over. That is why the e-commerce directive has emerged as a way of considering some of the broader issues surrounding the internet throughout Europe. We recognise that, in a world of rapidly developing technology, international issues can be an extremely important part of the lives of people in this country.

I hope that I have responded to the questions. The clause is important. Inevitably the debate has ranged around many later clauses, because, although the clause sets out the Bill's broad scope, many later clauses are essential in specifying defences and some further issues, for example, distribution.

David Wilshire (Conservative, Spelthorne)

Will the Minister give way?

Yvette Cooper (Labour, Pontefract and Castleford)

I nearly got away with it.

David Wilshire (Conservative, Spelthorne)

Yes, the Minister nearly got away with ignoring one of the key questions. I asked whether she could give us a definition of ''in the United Kingdom''.

Yvette Cooper (Labour, Pontefract and Castleford)

I understand that publication would be in the United Kingdom if the advertisement is shown to passengers who are here. That includes part of British airspace, although there is the problem of enforcement, about which sensible decisions would have to be taken.

David Wilshire (Conservative, Spelthorne)

I am grateful to the Minister for that statement; I will return to it shortly.

I wish to put the Minister out of her misery. Wilshire is the Member of Parliament for Ali G's constituency. I am not a member of the ''Staines massive'', but I am the hon. Member for Spelthorne. [Interruption.]

David Wilshire (Conservative, Spelthorne)

I have been called all sorts of things in my time, and I have never yet taken offence.

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

The hon. Gentleman is a terminal bore.

David Wilshire (Conservative, Spelthorne)

Yes, that is a good one.

The Minister rightly said that the clause creates wide-ranging offences. Given that the Bill will be on the statute book, it is right that they should range as widely as possible. However, it is also important that those offences are clearly defined, so that we know where we are going.

With regard to the phrase,

''in the course of a business'',

I followed the Minister a long way down the track, but I became seriously alarmed when she drew a distinction between the individual's right to free speech and a collective right—or lack of right—to free speech if one forms a business.

I wish the Minister to reflect on that, and to clarify whether she really meant what I understood her to be saying, which is that it is alright for me, as an individual, to have a right of free speech—that is what democracy is about—but that the moment that I build a business on the right to free speech, that right is taken away from me. If that is what the Government believe, we need to know that. We must have that out in the open once and for all. Putting aside all of the medical arguments, one reason why a group of people object to this legislation is not because they love smoking and tobacco, but because they see it as an assault on the rights to free speech. I think that I heard the Minister admit that that is right. If she has made that admission, we have made real progress this morning in showing why this is a dangerous Bill.

Kelvin Hopkins (Labour, Luton North)

The hon. Gentleman is talking about free speech as if it is unrestricted—[Interruption.]

Sir David Amess (Conservative, Southend West)

Order. There is too much background noise. If Committee members wish to have private conversations, they should leave the Room.

Kelvin Hopkins (Labour, Luton North)

There are many sensible restrictions on free speech, such as incitement to do all sorts of different things that are undesirable to society and to individuals.

It is sensible to restrict the free speech to advocate smoking, which kills hundreds of thousands of people every year. I support that.

David Wilshire (Conservative, Spelthorne)

That is a fair point, but it does not address the point that I was making. It is possible to construct an argument that there should be a limitation on free speech with regard to tobacco advertising—the Government have done that several times. However, my concern is that the Bill introduces a differentiation with regard to the restriction on free speech: an individual has that right, but a group of people running a business do not. That is what I heard the Minister saying—that certain people can have the right and others cannot. I hope that the hon. Gentleman accepts that that cannot be fair, because I agree with him in principle.

Kelvin Hopkins (Labour, Luton North)

There is a great difference between an individual who does not receive any financial reward saying, ''I think smoking is a sensible idea'' to his neighbour—that is not something that the law would intervene to prevent—and someone taking money to promote the sale of cigarettes, and getting people addicted to the dreadful habit of smoking.

David Wilshire (Conservative, Spelthorne)

That is the correct counter to my point, but I wish anyone who is listening to debate—or who thinks about it while reading the transcript—to ask themselves whether it is a proper response. Should one draw a distinction? I merely think that that is an interesting issue and that the Government have been exposed for sloppy thinking in the way that they approach the freedoms of the individual.

I was also concerned that the Minister said that it was permissible to put an ''I love smoking'' sign in the window—reference was made to Marlboro advertisements, although I cannot remember the details. Let us suppose that a commercially produced advertisement comes into my possession when I am abroad, which has never been published in the United Kingdom. Am I entitled to put it in my suitcase, bring it home and put it in the window? I think that the record will show that that is what the Minister suggested, which would surely create a loophole.

People who are not pursuing the course of their business but merely feel strongly about the issue, could distribute things to returning passengers at ferry ports such as Calais. There is a world of difference between me scrawling on a bit of paper, ''I love tobacco'' and putting it in the front window, and picking up a commercially produced advertisement in Calais, bringing it home and sticking it in the window because I feel so strongly that my civil rights are being abused by this legislation. I do not think that that is what the Minister meant, although that is what she suggested. I would welcome clarification.

In replying to the helpful interventions of my hon. Friend the Member for Taunton, the Minister said that she was ''struggling''. The hon. Lady is responsible for the Bill and has the support of as many civil servants as are necessary, the opportunity to study and discuss the Bill with experts and to take legal advice. If the person with the greatest expertise in the Room says that she is ''struggling'' to understand arguments that are being made, what will be the effect on businesses or in the courts?

We demonstrated earlier the serious issues surrounding the example of a journalist who writes, ''This event used to be sponsored by'' in the report of a course of business unrelated to tobacco advertising—whether or not the ticket was free is irrelevant. The Minister suggested that such an article would not constitute an advertisement. If that is so, I can understand why she would be struggling, because another loophole would be opened up. All the activity previously sponsored by tobacco companies could be referred back to as past events, and it would be an editorial rather than advertising matter. That must be cleared up because what stands in the record is another

invitation to people to use a loophole to get around the Government's intention.

I asked for a definition of ''published'', but I do not think the Committee got one, although we got quite close with ''shown to'' and ''available''. ''Available'' worries me. I am aware that that is a definition and the Minister has now suggested that ''being available to'' people in this country constitutes publication. That is a serious problem for later clauses in the Bill. We mentioned the aircraft example, in which someone has something in a back pocket that is not shown to anyone but is there just in case it is needed. If that is the definition of published, the anomalies, difficulties and so forth will be apparent when we debate later clauses.

In this debate, the Minister has said that common sense will have to apply in questions relating to British airspace—an admission that, if the current definitions are published, the legislation is likely to be unenforceable. I will not debate the defences available to people, as we will deal with them later.

I rather think that the Minister played into my argument when she suggested that where one lives does not matter. Another loophole would be created, because one could continue business in the United Kingdom for a person who lives somewhere else, and, because the wages and salaries of the company that employs one come from abroad, one would not be carrying on business in the UK. The Minister has created two sorts of people—those who do things for a British company and those who do things abroad. Knowing people's ingenuity, I can only say that, again, that will be an exploited loophole. As with each issue that I have raised on this clause stand part debate, the Government have compounded my worries rather than resolved them. When other people, especially lawyers, read the proceedings of this morning's debates, they will see opportunities for getting round the legislation.

I sincerely hope that the Minister will go away, have further discussions and come back on some of those matters on Report. Although I disagree with much in the clause, if the Government are determined to have their way, I hope that they will do so through provisions that are clear, concise and enforceable.

Yvette Cooper (Labour, Pontefract and Castleford)

I shall try to detain the Committee for as little time as possible. I am touched by the concern that the hon. Member for Spelthorne has to try to oppose the entire Bill and the whole principle behind it yet also to close all its loopholes. If Opposition Members could make their points a little more consistent as well as a little clearer, I might struggle with them a little less.

Some people would like to prevent individuals not involved in any business voicing their views about tobacco and cigarettes in the interests of health. I do not think that we should do that. It is right to protect an individual's freedom of speech. However, I do think it right to prevent the tobacco industry using its profits to promote products that kill. That is why this Bill covers actions that take place

''in the course of a business''.

It is right that it should and right that we should distinguish between something that happens in the course of a business, which includes the impact of sponsorship and free distributions, and decisions that individuals make in the course of their private lives.

The issue, in terms of jurisdiction, is where publication takes place and where distribution takes place, not where individual private citizens live. It is right, perfectly consistent and abiding by the right moral principle, for us to make that distinction.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.

Clause 3 - Advertising: newspapers, periodicals etc

David Wilshire (Conservative, Spelthorne)

I beg to move amendment No. 16, in page 2, line 5, after ''editor'', insert ''or printer''.

In moving the amendment, I clarify my interest, or lack of one. I grew up in the printing industry and owned a printing business. I sold it some time ago and no longer have any financial or commercial interest in that industry. I say that for the avoidance of any doubt, because what I shall say draws heavily on my past incarnation.

Amendment No. 16 would add printers to the list of people who will be caught by the legislation. It is important to pursue that issue. Other issues surrounding it are for a stand part debate and I shall not stray into them—I am aware of the danger. I should welcome the chance to debate those in due course but, for the moment, I am discussing the addition of the two words ''or printer''.

Looking at a range of other legislation in this country—I speak, as I said, as a former printer—the legal minefield for the printer of other people's products is enormous. My experience is that to say that one did not know or did not realise something is no defence. Yet here we are exempting part of the process, which I do not think that we should.

The most obvious example is the libel law. To say that one, as a printer, published a book or newspaper article that libelled someone else is no defence in law against being responsible. If the Bill were enacted as it is, the printer would be given an exemption. We are in danger of creating a loophole that will be easy to exploit.

John Barrett (Liberal Democrat, Edinburgh West)

What is the hon. Gentleman's understanding of clause 2(2)? It states

''A person who in the course of a business prints, devises or distributes . . . a tobacco advertisement . . . is guilty of an offence.

David Wilshire (Conservative, Spelthorne)

I was going to come to that once I had set out why it is important that the words ''or printer'' should be used. If a printer is included in one clause but left out of the next, which is inconsistent, lawyers would be provided with a long and expensive argument about which of those two clauses is the one to follow. Will clause 3 cover somebody who prints advertising in ''newspapers, periodicals'' and so forth? I worry every time I read ''etc.'' in legislation. All that I can see is the cash register going round for the

solicitors and barristers who will get locked into the meaning of ''etc.''.

Clause 3 does not refer to the printer. My supposition is that that would provide some sort of defence notwithstanding clause 2. If I am wrong—I am not a lawyer and there are lawyers in the Room—surely somebody will leap to their feet and say that I am worrying unnecessarily. I hope that that deals with the hon. Gentleman's point, which needs to be cleared up.

If the Government want clear and sensible law, I am surprised that they have not considered precedent. Libel law is crystal clear when a printer is involved. We all know electoral law, and despite changes to printing and publishing we still have to identify the printer. Both the printer and the candidate are caught by specific legislation if anything defamatory or untrue is put into an electoral leaflet, but there is no such specific wording in the Bill.

The obscene publications legislation is yet another example involving the printer. The law covering incitement to racial hatred would catch anybody printing such material. The Bill addresses something that, judging from some Government Members' conversations, the Government consider a social evil. However, the printer has been left out. If I were still involved in the printing industry, I would be very nervous about the confusion between clauses 2 and 3 and being the only person in the chain of publication, production and distribution who is not caught by the legislation. Pressures will be brought on the printing industry to be the loophole by which such advertisements are published. If advertisements are published abroad or the printer is not in business when they are published, the printing industry will provide a loophole that will not be covered as on offence. I shall be interested to hear why the Minister thinks that printers should be left out.

Adrian Flook (Conservative, Taunton)

In keeping with trying to be helpful in promoting the underlying aims of the Bill, I shall refer to the explanatory notes, which mention ''anyone in the chain''. I accept the point made earlier by the hon. Member for Edinburgh, West on clause 2(2). There should be some consistency, and clause 3(a) would be tidied up if ''or printer'' were added to it.

The hon. Member for North Tayside (Pete Wishart) referred to an advertisement—it was on a scrappy piece of paper—for the ''Bacci Bus''. If one could not find out who the organisers of the aforementioned bus were, one could go to the printer that produced the scrappy piece of paper that he waved in front of us. All Members of Parliament are subject to electoral law, so we are very aware of the ''printed and published by'' note at the end of every piece of paper put out in our name. I therefore find it surprising that the word ''printer'' cannot appear. It makes eminent sense to put together ''any proprietor or editor'' and ''or printer''.

Printing can be considered as a natural extension of ''proprietor or editor''. Indeed, the printer produces something that is tangible, unlike the editor or publisher. As we are not always sure who is the perpetrator of a tobacco advertisement, it is important

to have the opportunity to go to the printer, which produced a physical product that can be waved in the air, as my hon. Friend the Member for North Tayside showed. We should be able to say that we want to go after the people who printed the advertisement. It is strange that the Government have not already included the words of the amendment in the clause.

As someone who has employed printers for electoral communications—and between such communications, as elections are obviously not won purely during an election—I should declare the interest that I have given out printing business with intent to do so. If we did not insert the word ''printer'' we would not be able to go after the printer, who is likely to know who has asked him to print the advertisement—every printer I have ever hired has come after me for a bill. The printer is an important route to finding the perpetrators of an advertisement.

Yvette Cooper (Labour, Pontefract and Castleford)

I am tempted to accept the amendment. I like the idea of Conservatives amending—or, as they think, tightening—a Bill that they have fundamentally opposed and voted against, which I assume they will continue to do on Third Reading.

Tim Loughton (Conservative, East Worthing and Shoreham)

The Minister is being entirely disingenuous. She knows that we have reason to moan and that when we were talking about the programme resolution, I said that it was absolutely essential that if the Bill is to be passed—as it most likely will be—it must be watertight and fair. Simply acquiescing to shoddy legislation is not what the Opposition are here to do. We are here to ensure that legislation that must be passed works. We have not opposed the Bill outright, as she knows full well.

Yvette Cooper (Labour, Pontefract and Castleford)

A reasoned amendment that states that the Opposition would decline the Bill a Second Reading sounds like strong opposition to me. However, I look forward to the hon. Gentleman voting in favour of the Bill on Third Reading.

As much as I tempted to accept the amendment, it is completely unnecessary as printers are clearly covered in clause 2. Clause 3 clarifies exactly who is covered when it comes to newspapers, periodicals and other publications, so that there is no doubt that the editor, proprietor, or any person who directly or indirectly procures the inclusion of the advertisement is covered by the Bill. No one could be in doubt that the Bill covers printers when clause 2(2) refers to:

''A person who in the course of a business prints, devises or distributes in the United Kingdom a tobacco advertisement.''

I am sympathetic to Opposition Members' intentions, for which I thank them, but the amendment is unnecessary.

David Wilshire (Conservative, Spelthorne)

What an attempt to muddy the waters, and what an indication of a lack of understanding of democracy that was. It is the duty of Her Majesty's Opposition to oppose bad legislation and to be democratic. If we lose the argument in principle, as democrats, we do not go away and sulk; we participate in the democratic process by trying to make bad legislation slightly better. I do not think that

that is in any way contrary to the principles of opposition or contrary to my reasons for voting against the legislation previously. It is our job and I do not see why there is even a small point to be scored at our expense by criticising us for doing what we were elected to do.

We have come to the Committee to try and make a bad Bill marginally better. On that basis, I am disappointed that the amendment is not acceptable to the Government. I do not think that it contradicts anything that we stand for and it is a genuine attempt to clear up confusion. I sincerely hope that the Minister will not have to eat her words in due course when the courts get stuck into the legislation, noting that on one occasion it says ''printer'', and on another it does not.

In any event, even if the Minister still thinks that there is a point to be had at our expense, surely she has been here long enough to understand that an awful lot of amendments are tabled to probe the Government's thinking and to clarify their intention, not necessarily to add wisdom to the legislation. When I was on the Government side of the Committee Room, the number of spurious, doubtful, unacceptable and unhelpful amendments tabled by the then Labour Opposition were legion. It is silly to say that what we are doing this morning is wicked, when for 18 years it was done the other way around. In any event, I hear what the Minister says. I believe that she is wrong. Having goaded me into saying that I should not be trying to be helpful, on this occasion I shall refrain from being helpful. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Tim Loughton (Conservative, East Worthing and Shoreham)

I beg to move amendment No. 18, in page 2, line 5, after 'publication', add

'knowing it to contain a tobacco advertisement'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to take amendment No. 17, in page 2, line 9, after 'public', add

'knowing it to contain an illegal advertisement'.

Tim Loughton (Conservative, East Worthing and Shoreham)

In the spirit of not wanting to be churlish and having been duly patronised by the Minister in her response to the last amendment, I will not pursue the amendments if the hon. Lady can give us a simple assurance, which I am sure that she can.

The amendments relate to the ''knowingly'' amendment that we spoke to earlier. We did not pursue it after the hon. Lady gave us an assurance that our concerns were covered adequately by clause 5(5)(a), and the advertising defences clause. If she can give me those assurances and she is happy that they are watertight in this case, I shall be happy not to pursue the argument. I am sure that she can do that quickly so that we can move swiftly on to the next clause. We are now making very good progress on the Bill.

Yvette Cooper (Labour, Pontefract and Castleford)

Yes, I can give the hon. Gentleman those assurances. For amendment No. 18, which raises the issue of whether there was knowledge, there is a defence in clause 5(1) that says that a person does not commit an offence if

''he did not know, and had no reason to suspect, that the purpose of the advertisement was to promote a tobacco product.''

There is also a defence in clause 5(2) if

''he could not reasonably have foreseen that that would be the effect of an advertisement.''

Those provisions do not allow individuals to claim that they did not know that there was a tobacco advertisement in their newspaper. As editor or proprietor, they have to take responsibility for what is in their newspaper. If they did not know that the purpose or the effect was to promote a tobacco product, they have a defence. If they did not know that the advert was there in the first place, they have to accept responsibility.

Amendment No. 17 is completely redundant because there is a defence in clause 5(6):

''A person does not commit an offence under section 3(c) if he did not know, and had no reason to suspect, that the publication contained a tobacco advertisement.''

David Wilshire (Conservative, Spelthorne)

I was not going to intervene, but the Minister said that a proprietor or an editor must take some responsibility for what is in a magazine or a newspaper. I can accept the argument more readily for the editor than for the proprietor. I am not speaking on behalf of proprietors or trying to exempt them, but because of the way in which the printed media has developed as huge conglomerates, it is conceivable that a proprietor may not know what is in his publications. It is reasonable for the Minister to say that they jolly well should, but there is no defence in such a case. I hope to return to the issue of proprietors on stand part, if I may.

I wonder whether the Minister would care to reflect on a more sensible approach to the matter. For example, the proprietor should know or should have in place procedures that would bring the problem to light. The chances of a proprietor who owns thousands of newspapers, hundreds of magazines and so on being able on every occasion to vet every publication before it is let loose on the market is a practical absurdity. It cannot happen like that, yet saying, ''Heck. I could not have known, given the fact that these are daily or weekly publications. There are just not enough hours in the day for me to check'' will not be a defence. The alternative would be to have some proviso whereby it would constitute a defence if a proprietor could demonstrate that procedures were in place for someone down the chain to check on his behalf. There is a problem, and the Minister may care to comment and/or reflect on it.

Yvette Cooper (Labour, Pontefract and Castleford)

I am not entirely sure that I understand the hon. Gentleman. If he wants to clarify further, I will be happy to give way. It is right that proprietors and editors should have some responsibility for the content of the newspapers and magazines that they publish. Clearly, it is their responsibility to put in place the necessary procedures.

David Wilshire (Conservative, Spelthorne)

I am happy to clarify the matter. I agree that proprietors and editors have some responsibility. The debate is about how much responsibility they have. I was trying to persuade the hon. Lady that, for some proprietors, it is physically

impossible to do the checking necessary to fulfil the requirement. It seems to me that there is a need for further thought on the matter. If she would like to reflect on it, I suspect that she may agree that we have identified an issue that could well be considered on Report.

Yvette Cooper (Labour, Pontefract and Castleford)

Obviously, I am happy to reconsider the matter before Report stage, but I do not see that there is an issue to be addressed. The principle is clear. Defences are set out in clause 5, because it is right that people who are unaware of the purpose and effect of the advertisements should have a defence. Equally, it is right that we ensure in clause 3 that people take responsibility for their decisions.

David Wilshire (Conservative, Spelthorne)

I am grateful to the Minister for saying that she will reflect on the matter. However, I am disappointed that she then said that she did not see any need to take it further. Perhaps if I press her a little further, she may change her mind.

We do not disagree that proprietors have a responsibility in the matter—that is obvious. The Minister said that there was a defence if the purpose or effect of what was in the publication were not clear, but that there was no defence in saying ''I didn't know it was there.'' I am asking her to reflect on the level in the organisation that owns that publication at which responsibility should lie. As far as this provision is concerned, responsibility is vested purely in the proprietor, not in someone designated by the proprietor to have responsibility for checking what is in the publication.

That might sound like splitting hairs, but the measure is impractical in the global media industry. We have only to consider what has happened to local newspapers, probably in all our constituencies—they have been swallowed up in ever larger organisations so that one or two companies in this country now own literally thousands of daily, weekly, monthly and bi-monthly publications. It is nonsense to suggest that the proprietor is the person to be held responsible for checking the contents.

I ask the Minister to consider providing that it will be a defence for a proprietor to say that the person in their organisation responsible for that is X—that that is X's delegated job and that the responsibility for not doing that job therefore lies with X. Alternatively, we could provide that it is a defence if a proprietor has a procedure in place. Those were my suggestions. Neither of them was put in legal terms, but there is an issue there to which I hope we can return on Report when the Minister has had a chance to reflect on and clarify the clause.

Tim Loughton (Conservative, East Worthing and Shoreham)

In my brief introduction, I said that I was happy not to press the amendment, to move the Committee on. However, the Minister then gave a rather longer answer and the matter went further. My hon. Friend the Member for Spelthorne made some pertinent comments, which raised further questions that the Minister has offered to go away and examine. There is clearly more to the clause than we had thought, but if we can have a short debate on clause stand part, I shall not press the amendment. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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

Tim Loughton (Conservative, East Worthing and Shoreham)

We should like the Minister to clarify some brief points, which I am sure can be easily answered. Clause 3(b) refers to

''any person who (directly or indirectly) procured the inclusion of the advertisement''.

In my experience, ''procured'' is not a very parliamentary term. I have not seen it used in other Bills. Can the Minister elaborate on what procuring will mean in the context of this Bill? I would have thought that it throws up a whole host of possibilities.

Under clause 3(c),

''any person who sells the publication, or offers it for sale, or otherwise makes it available to the public, is guilty of an offence.''

I believe that concerns about that were raised in another place. Logically, we are talking there about paper boys or girls, who could be guilty of distributing something that contains a tobacco advertisement. They might see that, but have no knowledge that the law prohibits it. In reality, they are at the bottom of the responsibility chain. The culpability should lie with the newsagent selling the newspaper, periodical or

magazine being distributed by the paper boy or girl, and, above that, with the publisher, printer and other people whom we have discussed. I should like some assurances about where the cut-off point is. Common sense dictates that such people, in the lower echelons of the dissemination process, should not be included but, strictly speaking, under the clause as worded, they would be.

David Wilshire (Conservative, Spelthorne)

I have a couple of arguments that, again, may sound like nit-picking requests for definitions, but I should like them to be on the record. What does the Minister mean by ''proprietor''? Most organisations that are likely to fall foul of the legislation will be limited companies of some kind, which will have a separate legal identity. Are we saying that the proceedings will be taken against the company? I think that we can reasonably leave the shareholders out of that for the moment, although that might need to be cleared up too. Or, will proceedings be against the directors of the company? The penalties, under clause 16—

It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

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

Standing Committee A

Clause 3 - Advertising: newspapers, periodicals etc

David Wilshire (Conservative, Spelthorne)

I welcome you to what is turning out to be an absolutely riveting, thought-provoking and—I hasten to add—one-sided debate, Mr. Pike. We have tried our level best to engage Government Members in discussion but we have not been too successful. Perhaps they will catch your eye, which will help to spread the debate.

As I was saying when I was unceremoniously stopped this morning, two issues must be addressed. First, there is the question of whether a named proprietor would be a person, a limited company or the directors of a company.

I was stopped when I was moving on to my second worry, which is the definition of an editor. One or two people have been keen to say that asking for definitions is nit-picking, but in this case it is not. As the media industry has developed, the concept of editor has changed, as has the job title of people whom we may historically consider to be the editor. In this day and age, if we hauled the editor of the Daily Express to the Bar of the House, we would have to decide which editor to haul. It would be helpful if the Minister would give us a definition of the person who will be caught under the clause. Given that the Government will have their way, I am more than prepared to join in a sensible discussion about getting the provision right—that is the spirit in which I raise my query.

We all know from our constituency experience that people are called group editors or editors-in-chief, and that other job titles are developing. In order to avoid doubt, the Minister may need to reflect on that and get back to us on Report to broaden the use of the word ''editor''. It is tempting to say that an editor is self-evidently the editor, and that that is as broad as the issue gets. However, I hope that after the Minister reflects on job titles such as group editor and editor-in-chief, she will decide that there is a lack of clarity in the Bill that could be put right.

There is a potential booby trap in going down that route. If one starts to define types of editor, one is in great danger of catching sub-editors. If the word ''editor'' is intended to cover anyone who has the word ''editor'' in their job description, the wonderful venerable subbies, who are anything but the editors of a paper, could be caught. I suspect that the Minister

would not want such people to be held responsible for the publication of a magazine or a newspaper.

Yvette Cooper (Labour, Pontefract and Castleford)

I, too, welcome you, Mr. Pike, to the Chair this afternoon.

The clause makes it clear that in the case of press advertising, anyone in the chain from commissioning to selling an offending publication could be guilty of an offence. Such people could include proprietors, editors and employees of advertising agencies. We set out a special clause on press advertising because given the number of people who might be involved in the chain between commissioning a tobacco advertisement and selling a publication, it is important that the Bill provides further clarity.

Clause 5 provides for defences if a person did not know and had no reason to suspect, and subsection (6), in particular, provides a defence for a person charged under clause 3(c). The defences make it clear that, under such circumstances, a person is not expected to take responsibility.

The proprietor is the owner of the publication—for example, Associated Newspapers or the Telegraph Group Ltd. The editor is the person who is ultimately responsible for editing and deciding on the content of the publication. I appreciate that in the world of job title inflation, people can use many different titles, but the Bill is about those who are responsible given the traditional meaning of the word ''editor''.

David Wilshire (Conservative, Spelthorne)

I understand what the Minister is saying, but would she care to reflect upon the arrangements that are ever more commonly made by newspapers? For example, a newspaper with a range of editions may have a group editor who is responsible for the common parts and a local editor who is responsible for the specific parts in an edition. Under those circumstances, there is no one person who is ultimately responsible—at an editorial level—for the entire content of the publication. That is the type of point on which I want the Minister to reflect.

Yvette Cooper (Labour, Pontefract and Castleford)

That is exactly why it is right to retain the existing wording in the clause. Of course, individual papers or magazines may make their own arrangements about different lines of accountability, but individual cases will have to be judged on their own merits. The wording is sufficient.

The hon. Member for East Worthing and Shoreham (Tim Loughton) asked about the meaning of ''procure''. According to the dictionary, it means to obtain, to take care of, to contrive, to bring about especially by care or with effort. To procure the inclusion of an advertisement applies to the person responsible for an advertisement being published, whether he works for the advertising agency or whether he is an individual who is acting on behalf of the publication. That seems relatively straightforward.

I apologise if I have missed some of the points that were raised before the break in the stand part debate, but I have responded to all matters about which I have notes.

David Wilshire (Conservative, Spelthorne)

I do not rise to say that the Minister has overlooked any of the points that were raised, as I think that she has covered them, but I do not think that we should be satisfied by the response given to at least two of the issues that I raised. That proprietor means a limited company was the answer that I expected to hear. What I did not hear is whether the Minister believes that individual directors of a company should in any way bear personal responsibility. The penalties proposed under clause 16 would not be particularly onerous for a multinational media company. It could be tempting for a company, if the directors were not being held to account, to say that it did not really mind paying the penalties. We could find ourselves in a situation similar to that which resulted from the old Shops Acts, under which Sunday trading could be flouted because an owner could pay the fine and trade again on the following Sunday. I am worried that such a situation could recur.

It seems that there are two ways to remedy the problem. One would be to revisit penalties when we debate clause 16, but we would find that there are disproportionate penalties at the individual level. I urge the Minister to reflect upon the matter. If we are to improve poor legislation, we must plug every loophole that we can find.

I was also concerned about the answer to the question, who is the editor? The Minister is making a habit of saying that everything depends on the circumstances at the time; she used the phrase ''judged on its own merits.'' I do not subscribe to the view that we should pass simplistic legislation in this place, and then sit back and say, ''Ah well, let the courts decide.'' Clarity is cheaper than vagueness, because simplistic legislation leads to lawyers being asked to take matters through the courts, thereby making a lot of money out of our vagueness and unwillingness to address obvious issues.

This is an obvious issue, and it is easy to put it right. It would not be difficult for a parliamentary draftsman to get his or her mind around tightening the definition of ''editor''. In this legislation and in these debates, we keep using words that increasingly belong to a past generation. The printing and advertising trades, and the media in general, have moved on a lot since a range of legislation was written only 10 or 20 years ago—we are not talking about 19th century legislation. The Committee—or the House—should improve the legislation, in the interests of keeping solicitors' bank balances slightly smaller than they otherwise would be, although I hate to say that because, as I have mentioned, my son is a barrister, and he does not like me trying to keep his salary down by improving legislation.

I should like the Minister to indicate that she will take account of what has been said this afternoon and, if necessary, return to it on Report.

Yvette Cooper (Labour, Pontefract and Castleford)

I still see no problem with the word ''editor''. The hon. Gentleman has decided that there is a simple way to solve the problem that is taxing his mind, but he has not tabled an amendment that addresses it, so there is not an obvious solution.

David Wilshire (Conservative, Spelthorne)

I am sorry if I suggested that there might be a simple solution to this problem. I have not tabled an amendment because it is not a simple matter; it is very complicated. I am not a lawyer, but the Minister has at her disposal civil servants and parliamentary draftsmen who have better brains than me and much experience, and because it is a complicated matter, I want her to go away and talk to those experts to see if we can find an answer to that difficult problem.

Yvette Cooper (Labour, Pontefract and Castleford)

I do not accept that it is a complicated matter. It is right that the editor should be responsible. If there is a matter of fact to be determined in an individual case as to who has ultimate responsibility for determining and sanctioning the content of a particular publication, it is right that that matter of fact should be determined by the court. However, the Bill also makes it clear that the editor, along with others, must take responsibility for what gets printed in their publication.

Directors are not normally liable; the limited company is liable. However, clause 18 allows proceedings against directors if the offence is due to consent, connivance or neglect. We will have an opportunity to discuss that further, when we come to discuss that clause, if hon. Members have concerns about it.

David Ruffley (Conservative, Bury St Edmunds)

I seek clarification of the Government's thinking with regard to the use of the phrase,

''in the course of a business''.

I can think of at least two examples where the evil—if it can be called that—that the Bill seeks to outlaw might be perpetrated. Imagine if a tobacco factory in Nottingham—I know that there are tobacco factories there—were to experience a fall-off in sales of its product as a result of the Bill and had to shed jobs. As a result of that threat, the work-force convenor might say, ''I am going to put out a newsletter and advertise the wonderful brand of cigarettes that my work force produce. We are going to say 'buy these cigarettes and save jobs in your local factory.'''

Given that the thrust of the Bill is to stop the advertising of tobacco products, would it be lawful if a member of the work force were, in his or her private capacity, to put that message not on a company letterhead but in a local residents' newsletter sent to the streets around the tobacco factory? On the face of it, it appears that it would be lawful. I do not think that such freelance activity would be determined as falling

''in the course of a business'',

as it says in the clause. Does not the Minister think that that is a quite extraordinary loophole?

My second example, which is less powerful, but I shall rehearse it none the less—[Interruption.] If muttering Labour Members do not think that my first example was a possibility, perhaps they could adduce evidence as to why not. It was a perfectly feasible scenario to outline. I am just seeking enlightenment from the Minister—who has been very

helpful thus far, on which I congratulate her—as to why the Bill does not outlaw such activity. That seems a perfectly fair question.

Suppose that some university students, who produce a non-profit-making newsletter and are ideologically minded and of a libertarian cast of mind, see the Bill and find it offensive for ideological reasons, and want to strike a blow for the freedom of manufacturers to advertise a product that is not illegal; it is not unlawful to smoke cigarettes. Such a newsletter might then be disseminated across the city of Birmingham or, more likely, somewhere like St. Andrews. Is the Minister comfortable allowing something like that to slip through the net that the Bill attempts to cast over advertising?

Those are two clear loopholes that the words

''in the course of a business''

allow to come into being. I wonder whether the Minister would put my mind at rest by briefly rehearsing why that phrase was drafted. Why are there not more prohibitions in order effectively to deny opportunities for the creation of loopholes? I must say that my first example is better than my second.

Yvette Cooper (Labour, Pontefract and Castleford)

The hon. Gentleman is obviously desperate to find loopholes for us to close, and I appreciate his concern. Ultimately, such issues will be matters of fact for the courts to decide on, but the key test is whether people produce such newsletters

''in the course of a business''.

If they produce them in an organised way, the courts may well decide to interpret that as being in the course of a business. However, purely day-to-day conversation might not be in the course of a business, and might not be an advertisement, either.

Those will be the tests: whether it is an advertisement, in the normal understanding of that word, and whether it is produced in the course of a business. The other issue will be whether the producers are effectively sponsored to do so—that is, even if they are not doing it themselves in the course of their own business, whether they are effectively being sponsored by the tobacco industry for which they work, for example, and have a sponsorship agreement.

The second issue relating to not-for-profit student publications involves issues surrounding journalism. An advertisement is one thing. A piece of journalism, whether written by a student or someone else, would not be covered in the same way—unless the person involved were paid or received free distribution or sponsorship to write the article.

Ultimately, a judgment will be made. Some people would like anything that promotes tobacco products to be banned. We have made a decision to ban advertising in the course of a business and to allow free speech and discussion about the merits and health risks of smoking and of different tobacco products—when that is not done in the course of a business and when it does not constitute an advertisement.

That is right, because ultimately the purpose of a tobacco advertising ban is to protect people who want to give up smoking and children, who should not be bombarded by tobacco advertising. That is the

fundamental principle behind the Bill, and it is consistent.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.

Clause 4 - Advertising: exclusions

Adrian Flook (Conservative, Taunton)

I beg to move amendment No. 8, in page 2, line 13, leave out

', or is contained in, a communication'.

I regard this as an exceptional Bill of unprecedented character, because it seeks to ban virtually every possible means of bringing a particular product to the notice of the public. Yet we must not forget that it is perfectly legal to manufacture, sell, buy, use and, more importantly from the Government's point of view, tax that product.

Elements of the Bill impose prohibitions that are wholly disproportionate to the assumed and unsubstantiated claimed benefits. It is anticompetitive and restrictive of trade, it infringes important fundamental freedoms and rights and it bears all the hallmarks of legislation that will give rise to serious challenge in the courts.

The ban on advertising that the Bill imposes is obviously supposed to be total, save the exclusions in the clause, which are minor and poorly and inadequately drafted. That is why we tabled the amendment.

The amendment would amend subsection (1)(a), which states that an advertisement is not an offence if it is a communication or is contained in a communication made in the course of a business that is part of the tobacco trade, and is for the purposes of that trade and directed solely at persons in that trade, who are subsequently defined. The supplementary provisions of subsection (2) apply.

The Government tell us that they have no intention of prohibiting advertising or promotion in the tobacco trade. After all, as I said, manufacturing and selling tobacco are perfectly legal activities. However, my contention is that the subsection does inhibit such advertising.

The subsection refers to advertisements that are communications or contained in communications. The word ''communication'' can be interpreted in two senses. In the Bill, we should consider terms as having their natural meaning, as I said in our previous sitting in relation to the natural meaning of the word ''promotion''. According to the ''Oxford English Dictionary'',

''a communication may be a letter or message containing information or news, or, the imparting or exchanging of information by speaking, writing, or by using some other medium.''

In paragraph (b), the word ''communication'' and the same phraseology are used a second time, but by inference of what follows, a communication is something sent to a person who requests information. In that context, I would welcome guidance from the Minister as to whether communication is used in the same sense as in

paragraph (a). That would not seem to be the case, given the Government's remarks in the other place in November. Lord Filkin stated that the exclusion would apply

''to trade journals and magazines, mail shots for tobacco companies to retailers and handouts at trade exhibitions.''

However, Lord Filkin went on to say—and this is the worrying point—that that was not an ''exclusive'' list

''and there may be other forms as well.''—[Official Report, House of Lords, 16 November 2001; Vol. 628, c. 853.]

The amendment seeks to discover what those other forms are. Apart from things that may be sent or handed to persons within the trade, which may comprise advertisements, there are display advertisements at trade shows, and advertising at other trade events and within wholesalers' premises such as cash and carrys. All constitute communications, but are different from communications that may be handed or sent to a person. The amendment seeks to ensure that advertising and the promotion of tobacco products is permitted, provided that it is conducted within and solely for the purposes of the tobacco trade.

Yvette Cooper (Labour, Pontefract and Castleford)

Even after listening to the hon. Gentleman's argument, I still cannot see why his amendment is necessary. To be honest, I do not see how it would change the Bill in any way. He seemed to be saying that advertisements in wholesalers are not communications, but they are. They would be permitted as exclusions in the Bill subject to the conditions in clause 4 (2) only if they were directed solely at people engaged in the trade with particular ''responsibility for making decisions''. Otherwise, communications would also include such advertisements. It is not clear how removing ''communication'' would add to the Bill. It is hard to see how one could advertise without communicating. How could one have a tobacco advertisement that was not a communication of some sort? The amendment does not add to or detract from the Bill, so it is unnecessary.

Adrian Flook (Conservative, Taunton)

The intention of the amendment is that removing the words

''or is contained in, a communication''

clarifies and simplifies the rest of the paragraph. It is a probing amendment, and because the Minister showed great interest in not answering it, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Andrew Hunter (Conservative, Basingstoke)

I beg to move amendment No. 9, in page 2, line 15, leave out from 'persons' to end of line 19 and insert

'engaged in any capacity in that trade (even if they are also engaged in another trade),'.

Peter Pike (Labour, Burnley)

With this we may discuss the following amendments: No. 10, in page 2, line 16, after 'are', insert 'investors in,'.

No. 20, in page 2, line 26, leave out subsection (2).

Andrew Hunter (Conservative, Basingstoke)

I would also like to welcome you to the Chair, Mr. Pike.

Amendment No. 9 is especially interesting and curious because it seeks to amend an amendment made in the House of Lords so that the Bill reverts to its wording. In that debate, the argument put forward by Lord Faulkner was a reductio ad absurdum—it took the argument to a ridiculous point. He argued that the Bill, as originally worded, could apply to anyone selling cigarettes, and cited an example of a part-time girl on the cheese counter at Sainsbury's who, one day, happened to work in the tobacco kiosk. He said that the Bill, as originally worded, would describe that person as being engaged in the trade. That argument does not stand up. It takes things to a ridiculous level. It contradicts the position that the Government have adopted so far, which is that to define creates a loophole. Most of us thought that it was the other way round, and that the purpose of a definition was to close loopholes. There was an inconsistency in the acceptance of the amendment in the other place and the changing of the words compared with the position adopted by the Government not least about their reluctance so far in our proceedings to define the word ''advertisement''.

The second argument advanced in another place in favour of the present wording in the Bill was that it was important to make a distinction between those who were really at the heart of the tobacco trade and those on the periphery who could not be said to be part of the trade. We are at the point of whether definitions close or create loopholes. The Government would have us accept that a definition creates loopholes, so why close a loophole at that point in the Bill. Their approach has so far been to let the courts decide, so why not let them decide now?

I should be grateful for the Minister's guidance on the Government's interpretation of ''directed solely at'' in subsection (1)(a). In earlier discussions with publishers, it is understood that the Department said that if a trade publication made for the purpose of the tobacco trade and directed at people engaged in the trade was made available by retail sale on news stands, the exclusion would not apply. I should appreciate clarification on that, as it will affect the amendment. I believe that the Minister confirmed that view when we considered the previous Bill in Committee. Is that so, and is there scope for reconsideration?

The interpretation of subsection (1)(a) is highly questionable. It does not accord with what is in the Bill. The clause states that the exclusion is available if a tobacco advertisement is made for the purposes of the tobacco trade

''and directed solely at persons who''

are engaged in that trade in any capacity. The key issue is that it says nothing whatever about the means by which the tobacco advertisement might become available or whether it might accidentally or unintentionally be seen by someone not in the tobacco trade to whom it is not directed. If the Government's interpretation of subsection (1)(a) is that it is an offence for a trade publication available on a news stand to contain a tobacco advertisement, surely the situation is getting out of hand.

I shall outline the facts. Trade publications that are directed solely at people involved in the trade are usually available by subscription or provided free of charge by mail to persons in the trade. Some trade publications are also stocked and sold by ordinary retail outlets—although, generally, not in large quantities—for the convenience of people who are involved in the trade and who do not subscribe to the publication, or who occasionally need additional copies, or for other reasons.

Those publications have no appeal to the general public; they do not purchase them to read, although they are available in ordinary retail outlets. However, I understand the Government's position to be that offences would be committed under clauses 2 and 3 by publishers, distributors, producers of advertising for, and sellers of any trade publication that was made available by retail sale. I ask the Minister to consider that situation, because it should be remedied; the Government should take a different view of clause 4(1)(a), or accept the amendment.

Later in proceedings, when it will be more relevant to look at it in detail, we shall refer to the European Court of Justice and the recent case decided by the Swedish district court—I am referring to the Swedish consumer ombudsman versus Gourmet International Products AB. That has greater relevance to another part of the Bill, but it is also relevant here, and I refer to that ruling because I am sure that the Minister is aware of it. I hope that the Minister is willing to revert to the original wording of the Bill, and to offer an assurance that an offence will not be committed if a trade publication containing a tobacco advertisement is sold in ordinary retail outlets.

I shall speak more briefly about amendment No. 10, because I am optimistic that the Government will respond positively to it—that they will accept its logic and sense.

Investors in a tobacco supplier have an obvious interest in the tobacco products of the companies in which they invest. They have exercised a choice about which companies in which to invest. Any communication from the company to the investor is for the purpose of trade and, therefore, there is no reason why such communications should not include tobacco advertisements. Currently, investors are not included in the list of persons to whom an advertisement can be directed under paragraph (a), and I hope that the Minister will agree that they should be included.

Tim Loughton (Conservative, East Worthing and Shoreham)

I, too, extend my welcome to you, Mr. Pike. We are also looking forward to Mr. Winterton chairing the Committee at some stage.

I wish to talk briefly to amendment No. 10, which would exempt investors in tobacco companies from the restrictions in this Bill, as my hon. Friend has explained. It is perfectly clear to anyone that investors and, most probably, equity holders in quoted tobacco companies have obvious interests in those companies and knowledge of what they do. Most investors have their eyes open about the business that a company conducts. An equity holder will be interested in the

company's progress, its financial profitability and the business that it will carry out. The major quoted tobacco manufacturing companies, such as Philip Morris, Gallaher and Imperial Tobacco Group, have manufacturing, marketing and retailing businesses throughout the world, and most countries are not covered by prohibitions on advertising. Many hon. Members may want the ban to extend further, but that is not the issue. If the Bill is enacted, tobacco advertising will be banned in this country, which will affect many tobacco manufacturing companies and their offshoots that operate in this country. However, that would not affect their businesses in many other countries.

I do not knowingly hold direct holdings in any quoted tobacco companies, although the few collective unit trusts and investment trusts that I have may contain holdings in tobacco companies. However, if I were an investor in such a company, I would want to know about that company's activities throughout the world, as I do about any company in which I have invested. It would not be unusual for an annual report of such a company to give a review of the company's activities worldwide during the previous year. It would be likely that that would include a report on marketing activities in specific countries, which could include details of promotion and advertising campaigns. It would not be uncommon for examples of campaigns and actual adverts to be included in an annual or half-yearly report. Under corporate responsibility requirements, that could be included in environmental reports that are produced with the annual reports, because two thirds of FTSE companies produce them for their shareholders and stakeholders beyond equity holders.

It would be perfectly reasonable to expect that quoted tobacco companies might include pictures and replicas of adverts run in other parts of the world where that is legal and legitimate when disseminating information to their shareholders. As I understand the Bill, it would impose a degree of censorship on what tobacco companies could report to their shareholders in this country in their annual reports. That is absolutely crazy and wholly unnecessary because direct investors in tobacco companies have invested with both eyes open. They know that they have invested in a company that produces tobacco products and they have no qualms about that. Such people are not impressionable to tobacco advertising because they have actively sought to invest in a tobacco company, whether or not they are smokers. They would have to be over the age of 18 to be permitted legally to own shares because otherwise the shares would be in the name of a trustee and the literature would not be sent directly to a minor.

The Bill risks hitting unnecessarily the perfectly legitimate dissemination of information by quoted tobacco companies to their legitimate and aware shareholders, and I am sure that that was never its intention. We are here to restrict and prohibit advertising that may be deemed to promote smoking, or encourage people to take it up or smoke more. That is the Government's thinking behind the Bill, and I

appreciate that; we just disagree on whether the Bill will have the effect that the Government want.

Surely it was not the Government's intention to penalise shareholders who have invested in tobacco companies and are not impressionable smokers or soon-to-be smokers. That is our point, and it is perfectly sensible. If the Government do not accept amendment No. 10, the Bill will represent a rather odd form of censorship of companies that are going about their perfectly legitimate business. Hon. Members may have opinions about whether it is a good business to be in, but it is legitimate for any Committee member to invest in those quoted tobacco companies. However, it is not legitimate to restrict what those companies can put into their annual report to their shareholders.

David Wilshire (Conservative, Spelthorne)

I should like to follow on from what my hon. Friend says and take his argument a little further. To avoid any misunderstanding, I happen to have a modest number of shares in British American Tobacco. That it is not a declarable interest, but it is relevant to the debate. [Interruption.] It is not declarable. The comments of Labour Members demonstrate why it is important to pursue the subject. One can only assume that they do not know that BAT does not sell anything in the United Kingdom. That is why I say that the interest is not declarable.

The very fact that I am a shareholder is relevant to the point that I want to make. The Companies Act 1989 places a duty on all British companies—such as BAT—to report to their shareholders. It is not adequate for the Minister to respond by saying that an annual report does not need to have an advert in it. We had a debate on an earlier clause, when you were not in the chair, Mr. Pike, on why the Government thought it necessary to include both advertisements that have the purpose, and those that have the effect, of promoting tobacco.

It is perfectly possible for an annual report to have no advertisements, and the directors of a company need not deliberately set out to use the annual report as a vehicle to advertise their product. It is not that for which the amendment is seeking an exception; that would be using something for the purpose of advertising. The problem is that the report might have the effect of being an advertisement to an investor. I understand that, under the Companies Act, companies are legally obliged to tell shareholders how well the company has done, and to say what the prospects are for the investors.

An utterly factual annual report could have no illustrations, and make no attempt to advertise, and could set out only what is required under the law. Citizens of this country could get such an annual report from a tobacco company that is doing nothing illegal; it is selling a product and making a profit. I know that some hon. Members do not like the idea of profit, but selling is a perfectly legitimate activity. If that company is particularly successful, and if the annual report suggests that the product is a good

investment, the effect of producing the annual report may be to encourage smoking, because a person may receive the report and think, ''I am doing very well out of this; it must be a successful and enjoyable activity, so why don't I smoke and help to increase the profits of my company?'' People could think like that, and it could be argued in court that that is what that annual report was achieving. Therefore, that document would fall foul of the law, because it would have the effect of promoting smoking and the use of tobacco.

A company that finds itself in that situation would be in a dilemma. On the one hand, it would be required to comply with the Companies Act and, on the other hand, it would be required to comply with this Bill. If it did what the law required by complying with both, one way or the other it would be committing an offence: it could either leave things out of its annual report and commit an offence under the Companies Act, or it could put things in it that it legally had to include and commit an offence under this Bill. The Minister must take that seriously—rather than look bored because I am yet again raising a matter that she does not want to get her mind around—because it is important.

I return to the point that I made about British American Tobacco. It has not briefed me in any shape or form on this—I have had no contact with it about the legislation. Those Labour Members who do not understand the vagaries of the international tobacco business may not be aware that a brand is not owned solely by one company. If I have got the following example wrong, I apologise to the owners of the brand, but company A might be the producer of Benson and Hedges cigarettes for sale in the UK and BAT could be the producer and marketer of that brand elsewhere in the world. That is the way that the tobacco industry works.

In those circumstances, there is a further problem with regard to sending information to investors—or to anyone else. A company that does not sell anything in this country might report on the success of a brand that it produces. That company will be reporting on something that takes place overseas, and the Bill does not deal with things that happen outside the UK. However, by reporting on the sales of a particular brand, which is entirely legal in the rest of the world, that company might inadvertently be producing an advert for a brand that is produced by a different company for sale in the UK. It is not possible to say that there are foreign brands and there are British brands; it will not be good enough to say that a company that trades abroad will not be caught by this, because its activities will spill over into the activities of a company trading here. I am not talking about advertisements in glossy magazines that might accompany the annual report; that is a different issue, and they would be advertisements under the definition. However, I bring the Minister back to the crucial point of having to comply with financial legislation and produce information, the effect of which could be held to be encouraging smoking.

I would like the Minister to clear up those points, before I discuss amendment No. 20.

Yvette Cooper (Labour, Pontefract and Castleford)

Amendment No. 10 alters clause 4(1)(a) to create an additional exclusion from the advertising ban to allow tobacco companies to send unsolicited advertisements for their products directly to their investors. The Government oppose the amendment. The Bill does not prevent companies from communicating with their investors about their shareholding—about the company's profits and losses, about the arrangements for the annual general meeting, or about any of the other issues about which they might need to communicate with their investors. However, it is right that investors should have the same protection from unsolicited advertisements and promotional material as the rest of us. People who have shares in tobacco companies will be among the 70 per cent. of smokers who want to give up.

Tim Loughton (Conservative, East Worthing and Shoreham)

Of course, everyone should be entitled to the same protections. Does the hon. Lady agree, however, that adults who have invested their money in companies whose business is largely—or wholly—the production of tobacco products are wiser about the perils of those products than others about whom we have spoken? Should not such people be dealt with under a special category of people who are better informed than those at whom the legislation is aimed?

Yvette Cooper (Labour, Pontefract and Castleford)

If such people wish to receive advertising material—in the same way as everybody else—they can do so under the exclusion in clause 4(1)(b). If they make a particular request, they can receive a communication in reply. That option is open to them, as it is to others. They should not be dealt with as a special category because that would create a loophole. There would be nothing to stop tobacco companies giving free shares, or inviting people to buy one or two shares, and thereby creating a database of people that they could bombard with advertising.

Tim Loughton (Conservative, East Worthing and Shoreham)

If tobacco companies, or any other quoted companies, were to give out free shares they would soon fall foul of the Financial Services Agency. In normal circumstances, such activity is not allowed.

Yvette Cooper (Labour, Pontefract and Castleford)

Either way, it is important that investors should be afforded the same protection as everybody else. I do not see why they should be treated differently simply because they bought, some considerable time ago, some shares in a tobacco company. I do not see why the tobacco industry should be permitted to bombard those people with promotional material that contains advertisements of any sort. It is right that such people should be able to receive information if they request it, but tobacco companies should not be given an exemption and should not be able to promote their products—products that ultimately kill—to investors.

The hon. Member for Basingstoke (Mr. Hunter) raised questions about amendments Nos. 9 and 20. The Government reject those amendments, which seek to restore clause 4(1)(a) as it stood when the Bill was introduced in another place, but which was amended. The intention of the amendment in the other place was to prevent the creation of a loophole whereby a tobacco company could promote its product to anybody working for a company that was involved

in the tobacco trade, even if many of those people had no engagement with decisions whether or not to buy or sell tobacco products. The example referred to by the hon. Gentleman was cited in the other place. It concerned a person working in the kiosk in Sainsbury selling tobacco products, who had no responsibility for any of the decisions about how they were sold or displayed, and how that person should not be subjected to advertising and promotional activity simply because of where he works.

The tobacco industry should be able to continue to trade because, as hon. Members have said, it is legal to do so. That is why the exclusion is in the Bill. However, that should be no excuse to put, for example, a tobacco advertisement in the Tesco staff magazine simply because, among other products, Tesco sells cigarettes. That is why we reject amendments Nos. 9 and 20.

The hon. Member for Basingstoke referred to trade magazines on general sale in newsagents. Surely, that is strong evidence that communications are not being directed solely at people in the trade. It might be different if a newsagent were keeping such magazines under the counter and selling them only to people in the trade. A trade magazine that is on general sale to the public does not fit within the exclusion under clause 4 about it being directed solely at people who are engaged in the trade. If people want to put trade magazines in general newsagents, fine, but the wise thing to do would be to remove the tobacco advertisements from them. That is why the Government oppose amendments Nos. 9, 10 and 20.

Tim Loughton (Conservative, East Worthing and Shoreham)

The Minister's response to amendment No. 10 was breathtaking. She soon had to resort to a complete misinterpretation of what the amendment is designed to do. She says that investors are no different from everyone else and that companies should not be permitted to ''bombard'' them with adverts because they happen to have bought some shares some time ago. Shareholders in tobacco companies have no special immunity against the effects of the products that the companies produce, but that was not my point. I was talking about not bombarding, as she puts it, such shareholders with adverts but the contents of an annual report that will be sent to shareholders in the normal course of events, which may contain examples of adverts and advertising campaigns that the company has used in other parts of the world.

Clause 3 states:

''If a newspaper, periodical or other publication . . . containing a tobacco advertisement is in the course of a business published in the United Kingdom'',

a list of people are guilty of that offence. An annual report and account of a UK-based company, which is a publication produced in the UK in the course of its business, clearly falls foul of clause 3 and is not subject to any of the defences in clause 5(5), in particular. The Minister has not explained whether companies that reproduce such adverts as part of their reporting process would be exempted or fall foul.

A possible beneficial side is involved. I as a shareholder in one of those companies might be made aware of what seemed to be an especially unscrupulous advertising campaign that the company was carrying out in a developing country, for example. If I thought that that went well beyond the morals of a company in which I wanted to invest and that report and accounts alerted me to it, I might choose to be an investor in that company no longer, and my opinion of that company might be affected as a result.

Under the Bill, the company could not make me aware of any of those campaigns, whether in the annual report or in any other literature sent to shareholders in the normal course of events under the Companies Acts, regardless of whether that constitutes bombarding. A great deal of censorship is involved, which might have a counter-productive effect.

It was rather telling when my hon. Friend the Member for Spelthorne (Mr. Wilshire) mentioned that he was a modest investor in the shares of British American Tobacco. Gasps of horror and ''Surprise, surprise'' could be heard from Labour Members. It is a perfectly legitimate process, occupation, hobby or interest to be an investor in shares of quoted companies that happen to be in the tobacco business. It is perfectly legitimate to work for them. Labour Members may remember that the hon. Member for Hampstead and Highgate (Glenda Jackson) appeared some time ago in a high-profile series of advertisements for a company called Hanson that had the slogan ''A company from over here doing rather well over there''. The company owned Imperial Tobacco, whose major business was manufacture of cigarettes. If Labour Members are to start pouring scorn on legitimate shareholders in such companies, they might want to pour scorn on one of their colleagues who was paid to appear in advertisements to promote the business of a company with a considerable interest in tobacco manufacturing.

David Wilshire (Conservative, Spelthorne)

Does my hon. Friend agree that if it is wrong to invest in something that kills people, surely it is wrong for the Government to take tax from a company that kills people? In that case, is banning the tobacco industry the honourable thing to do?

Peter Pike (Labour, Burnley)

Order. Hon. Members must keep to the amendment rather than discussing something that is way beyond it.

Tim Loughton (Conservative, East Worthing and Shoreham)

Indeed, Mr. Pike. The point that my hon. Friend made is entirely consistent. One could also mention recent cases of senior directors of companies that produce arms contributing to Labour party funds, but I shall not go down that path because you would not wish me to, Mr. Pike.

I want a specific answer to the question of a specific and reasonable scenario that I mentioned earlier. Would a company, such as British American Tobacco, Gallaher or Imperial Tobacco Group, that is based in the United Kingdom and involved in tobacco manufacture or retailing—any supermarket, for example, because they all have tobacco stands—be

penalised for printing details or pictorial reproductions of advertising campaigns that were used legitimately in other countries in its reports and accounts? The report would be sent only to the company's shareholders, and would be sent automatically without the need for a request each year, as would be required under the Bill if they were on a mailing list. That is a specific and detailed question to which I would like a specific and straight answer.

David Wilshire (Conservative, Spelthorne)

I, too, was unimpressed by the Minister's response. When I discussed annual reports, I failed to persuade her that she should accept the amendment. Let me see whether there is the possibility of meeting half way.

I explained that there are two issues surrounding the annual report: promotion and effect. The entire focus of the Minister's response was to ask why investors should be bombarded with adverts. I am happy to meet the Minister half way. I do not support the amendment because I want to create a loophole for advertisements with the purpose of promotion. Can the Minister and I agree that sending promotion to investors should be illegal, but can we find a compromise on effect? I happily concede on promotion because I did not mean that in the first place.

I give the Minister an example that might produce a compromise. An annual report would be sent out that indicates how well the company has done. If the company produced a range of brands and one of them had significantly influenced its share value, it would have to report that to the stock exchange anyway. The report could say, ''This year, the sales of brand A have slumped. We have had difficulties because it is a high-tar cigarette, and Government health warnings on the packet and the campaign on the dangers of tar has had an impact. Brand A has suffered badly, which has affected our profitability.'' The report might continue to say, ''Your directors have tried to counter the loss of profits by introducing a new brand: brand B. Brand B is low tar and not as damaging to your health as brand A.''

John Robertson (Labour, Glasgow Anniesland)

It is still killing people.

David Wilshire (Conservative, Spelthorne)

The hon. Gentleman keeps interjecting. If he wants to debate whether the Government should ban smoking, let us have that debate.

Peter Pike (Labour, Burnley)

Order. The Chair does not like sedentary interventions. Hon. Members who want to contribute to the debate should rise to make their contributions.

David Wilshire (Conservative, Spelthorne)

I just wanted to flag up that, if the Committee under your chairmanship, Mr. Pike, wants to have a debate about making tobacco illegal, let us have it. If that is the real agenda of Labour Members, it is right that the public should know about it. Hon. Members should not hide behind the Bill, saying that something remains legal. A company that is conducting legal business and wants to send out an annual report must be entitled to do so. The effect of

that makes for an interesting debate, but it is not relevant to the clause.

Let us suppose that brand B has been introduced and the directors say in the annual report how successful it has been because it is less damaging to health. That company could have tens of thousands of small investors, who will receive an annual report without an advertisement or a deliberate attempt to promote smoking. However, it might suggest to investors in the company that they should consider, for the purposes of their health, switching to brand B. If that were to happen, the effect of the annual report would be to boost the sales of brand B. I suspect that a court would hold that that would run foul of the Bill and its reference to ''effect''.

Perhaps the Minister will meet me half way. Let us leave to one side the bombardment point. We do not want anything to go to an investor when the purpose behind it is to promote, but should not we make an exception for annual reports to investors? Let us consider the effect of complying with the Companies Acts and reporting that something new and successful has led to other people switching to that brand. The hon. Member for Glasgow, Anniesland (John Robertson) keeps saying that the products kill, but some are more likely to kill than others. If the effect of an annual report is to reduce the risk to the smoker, even the hon. Gentleman may welcome it and not regard tobacco as something that should be made illegal.

Yvette Cooper (Labour, Pontefract and Castleford)

Opposition Members have said that they do not want investors to be bombarded with tobacco advertisements. Unfortunately, that is exactly what the amendment would allow. Companies could send unsolicited advertisements for their products directly to their investors. It may not be their intention, but they could do so under the amendment. I do not understand why banning tobacco advertisements prevents companies giving their investors all the information that they need, whether it is about their activities, their marketing, their profitability or their technological development. The Bill bans advertisements, and that brings me to the point of the hon. Member for Spelthorne that an advertisement must have the effect of promoting tobacco products. The argument would be whether it was an advertisement, and if it were it would be covered by the Bill, and rightly so.

David Wilshire (Conservative, Spelthorne)

Surely the purpose of the annual report is to advertise the success of the company. That is the advertisement.

Yvette Cooper (Labour, Pontefract and Castleford)

The information that investors rightly want and should be entitled to is information about their investment and how the company is doing. They should receive the knowledge that is necessary for them to decide whether to continue investing in that company. That should not give the company a licence to advertise their products at those investors, merely because they are investors. That is the distinction. Investors can receive advertisements alongside everyone else, if they so choose, by requesting them in the way that is covered under subsection (1)(b). However, I do not see why investors should be treated differently when it comes to the

advertising of tobacco products as set out in clause 1. Ultimately that would create a loophole, which would be unacceptable.

David Wilshire (Conservative, Spelthorne)

That response was so bizarre that it requires pursuit. The Minister's answer shows her failure to grasp the purpose of an annual report and the way in which it is produced and published. If the Minister cannot grasp that one of the primary purposes of an annual report is to be an advertisement for a company, I suggest that she goes to a presentation by a major company in the stock exchange.

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

As the hon. Gentleman suggested, one purpose of an annual report is to promote the company as an attractive vehicle for investment. It is never designed to promote the products produced by the company.

David Wilshire (Conservative, Spelthorne)

I accept that the hon. Gentleman has a point. However, the problem with that argument is that the Bill makes it clear that the thing itself does not have to be the advertisement. We covered that ground when we discussed the fact that it is the thing contained within that runs foul of the law. Perhaps the purpose of an annual report is not to promote the sale of tobacco, but it would have that effect, and that worries me.

Adrian Flook (Conservative, Taunton)

Earlier, I declared an interest. I used to work for a financial public relations company, and I was involved in designing and promoting annual reports. I can state categorically that such reports are produced for no other reason than to provide information for investors about what the company does and, more importantly, as a promotion—to tell people what the company does and to promote its products to the wider world.

David Wilshire (Conservative, Spelthorne)

I will be eternally grateful to my hon. Friend. His is the voice of real experience, rather than mine as a lay investor in a company. If I am not succeeding in persuading the Minister or the hon. Member for North-West Leicestershire (David Taylor), they should go to the City and sit in on a presentation made by a major company to the stock exchange, especially to pension funds. I would not like to probe hon. Members' pension funds too closely.

John Robertson (Labour, Glasgow Anniesland)

The hon. Gentleman mentions pension funds. Call me an old cynic, but I imagine that pensioners investing in pension funds could be inundated with annual reports containing advertisements. Such investors may not be aware that their pension fund invested in tobacco industries. They would be appalled to receive such advertising through their doors. Is that not exactly what the Minister is trying to avoid?

David Wilshire (Conservative, Spelthorne)

The hon. Gentleman suggests that pension fund investors receive that sort of information. They do not. We are discussing pension fund managers. If the Minister said that to pursue the matter would mean that everyone who had a pension would be sent something, I would agree that the hon. Gentleman was right, but I do not believe that to be the case.

John Robertson (Labour, Glasgow Anniesland)

Are you telling me that that is impossible under the law? Is there is no way that you can send anything to investors in pension funds from a company that is being invested in to support that pension fund? Can you categorically tell me that?

Peter Pike (Labour, Burnley)

Order. The hon. Gentleman must not use the term ''you''.

David Wilshire (Conservative, Spelthorne)

I am not a pension fund manager, and have never made any attempt to learn whether a pension fund would give me a list of its policyholders. I sincerely hope that it would not. The only way that one could communicate with the policyholders of a pension fund would be to get such a list. I should imagine that if a pension company were to send adverts for tobacco, it would immediately fall foul of the Bill. I understand what the hon. Gentleman says; if he were right, I would be on his side, but I am fairly confident—with the caveat that I am a layman in such matters—that he need not worry on that score. However, if I am proved wrong, I shall apologise.

Tim Loughton (Conservative, East Worthing and Shoreham)

Perhaps I can help my hon. Friend as someone who was in the fund management industry for 16 years. When I ran individual and collective funds—a unit trust—if I had held a tobacco company's shares, there would be a report of that in the accounts that would go to the collective fund's manager, in whose name, or in whose company's name, the shares would be held. There is no direct contact between the tobacco company and the hundreds of thousands of pension fund holders who happen to hold a stake in that pension fund. The hon. Gentleman's fears are completely and utterly unfounded.

John Robertson (Labour, Glasgow Anniesland)

That does not answer the question.

David Wilshire (Conservative, Spelthorne)

I hear what the hon. Gentleman says, but I hope that my hon. Friend the Member for East Worthing and Shoreham has answered half his question. I shall now try to answer the other half.

On the question of pension fund managers being bombarded with information, I think that that already happens and will continue, not because people would send such information unsolicited, but because any pension fund manager who wants to keep his job and be successful will make it his business to ask for the maximum amount of information, in order that the investment decisions made on behalf of the pension fund investors are made in a sensible and knowledgeable way. We do not have to worry about the pension fund managers; they exist to get that information, and will ask for it. There are not many of them anyway, so there would not be thousands of people being bombarded with information. I hope that that reassures the hon. Gentleman that we are not seeking to do what he suggests.

What concerns me is that the annual report is in itself intended to be an advertisement. The presentations made by companies to pension fund managers, unit trust managers and others are deliberately designed to sell the product, and the products are shares in that company. The success of a company and its ability to invest in the future depends upon its success on the stock market; it can then raise more money. My hon. Friend the Member for

Taunton (Mr. Flook), who is the expert, has confirmed that the annual report is intended to be an advert. People like him have earned their living producing such adverts.

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

The hon. Gentleman may care to correct a statement that he made. I think he said that the products that are made make shares in the company. Is that what he means?

David Wilshire (Conservative, Spelthorne)

If I said ''the products that they make'', I apologise. What I intended to say, and hope that I did say, was that the products that the presentation sells are shares. If I did not make that clear, I apologise.

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

Will the hon. Gentleman explain why increasing the demand for the shares of Gallaher or whoever would be linked to the promotion of tobacco products and greater sales of those products?

David Wilshire (Conservative, Spelthorne)

It would do so for the very reason that I gave. I was seeking, by talking about the presentations to the pension fund managers, to demonstrate beyond all doubt that the annual report is itself an advertisement. I should have thought that fund managers are far too hard bitten to fall for any of that smoking rigmarole.

We have established via pension fund managers that the document is an advert. We must then fall back on the fact that anything contained in it that has the effect of promoting tobacco is illegal. It is at that point that we switch to the hundreds of thousands of small investors, who get the same document through the letterbox. The document is an advert because of the purpose for which it was produced, mainly for the pension funds, in which the primary decisions are taken. The presentation goes to tens of thousands of people, and if they read it, the effect may be to make them decide, ''I will buy brand B''. That way, brand B has been promoted via an advertisement. That concerns me.

David Ruffley (Conservative, Bury St Edmunds)

I rise to support my hon. Friend's point. Labour Committee members should read clause 1 again, where a tobacco advertisement is defined as,

''an advertisement—

(a) whose purpose is to promote a tobacco product, or

(b) whose effect is to do so''.

Within the terms of that definition, statements in an annual report would, beyond peradventure, amount to tobacco advertisements.

David Wilshire (Conservative, Spelthorne)

I thank my hon. Friend. I am relieved that someone present has a better memory than me. I was floundering to remember which clause included that definition. That goes right to the heart of the argument that we had about clause 1: we were told that we need not worry, because there needs to be both ''purpose'' and ''effect''.

David Ruffley (Conservative, Bury St Edmunds)

There needs to be purpose or effect.

David Wilshire (Conservative, Spelthorne)

Exactly so. We now have the proof that to include ''effect'' is going too far.

I agreed to meet the Minister half way. If the purpose is to promote a tobacco product, I am on her side. I do not want to allow annual reports deliberately to include advertisements. I hope that I have said

enough to persuade her that we have a difficulty with the matter under discussion. It will be said, ''There is an effect. It is an advertisement. It will have an effect on the investors.'' If the company does not include information that it is legally bound to communicate, it will be in breach of the Companies Act, and the Financial Services Authority and other organisations will come down on it like a ton of bricks. I hope that the Minister will respond to the spirit of my offer to meet her half way, by saying that she sees the point that I am trying to make.

Yvette Cooper (Labour, Pontefract and Castleford)

We have been round the houses on this matter. Companies can choose which and how many pretty pictures they include in their annual reports—they can put in whatever they want. If they publish a tobacco advertisement—that is, an advertisement whose purpose or effect is to promote a tobacco product—and if the exclusions explicitly set out for people engaged in the trade and so forth do not apply, they are covered by the Bill.

Companies are entitled to promote or advertise their shares through annual reports or other sorts of circular to their investors, but they are not entitled to advertise their tobacco products unsolicited to their investors. That provision is right. I do not see why the tobacco companies should be given a loophole through which they can bombard their investors with advertisements for tobacco, as this amendment would allow—advertisements that promote tobacco products or have the effect of doing so.

Companies will not be prevented from providing their investors with all of the information that they legitimately require and need about the marketing or the business of the company and so forth. We have dealt with this subject at length and I oppose the amendment.

Andrew Hunter (Conservative, Basingstoke)

We have had a reasonably full and lively debate on these amendments and any objective listener will conclude that the Government's position is weak. It is weak with regard to amendment No. 20, because it has been argued that definitions create loopholes, but the Government intend to reject an amendment that would remove an unnecessary and unwanted definition from the Bill.

The Minister's remarks about amendment No. 9 were also unconvincing. Trade magazines are sold in general retail outlets, but only a few of them are purchased because they are aimed at the people in the trade, rather than the general public. The Minister's argument that to allow that to continue would demonstrate that the general public was being targeted does not hold up.

I am most disappointed with the Government's defence against amendment No. 10. It failed to convince me. I do not propose to repeat the arguments, which have been well expressed. Reduced to its essence, it is clear to anyone who knows anything about the subject that the annual report is an advertisement. Likewise, to form a judgment on a company, it is essential to have marketing and advertising details. It is simply wrong for the Government to exclude, or ban, such information from investors.

On such occasions, it is important to concentrate one's power. I beg to ask leave to withdraw amendments Nos. 9 and 20, but we want to press amendment No. 10 to a Division.

Peter Pike (Labour, Burnley)

Amendment No. 20 cannot be withdrawn because it has not been moved.

Andrew Hunter (Conservative, Basingstoke)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: No. 10 in page 2, line 16, after 'are', insert 'investors in,'.—[Mr. Hunter.]

Question put, That the amendment be made:—

The Committee divided: Ayes 5, Noes 12.

Tim Loughton (Conservative, East Worthing and Shoreham)

I beg to move amendment No. 11, in page 2, line 19, at end insert—

'(ab) if it is contained in a specialist publication solely directed at existing adult users of tobacco products and containing editorial and material only relating to such products,'.

Peter Pike (Labour, Burnley)

With this it will be convenient to discuss the following amendments: No. 12, in page 2, line 20, leave out from 'in', to end of line 22 and insert

'a communication to an individual who has in writing provided to the person who, apart from this subsection would commit an offence, his name and address, his age expressed as being over 18 years, and a wish to receive communications of the kind to which this subsection relates, and has not in writing subsequently withdrawn that wish, or'.

No. 14, in page 2, line 22, after 'product', insert—

'(ba) if it is not for cigarettes or hand-rolling tobacco and is, or is contained in, a communication which is sent or transmitted by a specialist tobacconist to an identified individual,'.

Tim Loughton (Conservative, East Worthing and Shoreham)

We move on to another specialist technical area relating to specialist publications and the treatment of advertisements in them, especially as it involves other people in the trade.

We propose three amendments, which have been grouped together. Amendment No. 11 would add an additional provision that would exclude from the prohibition in the Bill anything that falls within its terms.

There are several specialised tobacco publications, I am led to believe, but I have never had the pleasure, or the boredom factor, of having to indulge in them. One is called Cigar Aficionado and is published in New York. Another, which sounds like the sort of thing that appears on ''Have I Got News For You'', is called Cigar World and is published in the UK. Neither of

those are trade magazines as such, but they are aimed at discerning consumers.

Under the Bill, I understand that Cigar Aficionado, which is published overseas, and other magazines like it would be allowed to circulate in the United Kingdom, whereas Cigar World, which I am sure is a good read, would not. What is the benefit of a disproportionate clause that would discriminate against a domestic publication? My hon. Friends have alluded to the recent ruling in Sweden—the Swedish Consumer Ombudsman v. Gourmet International Products AB—which is relevant to the Bill. The European Court of Justice also gave a ruling. Will the Bill require changes in the light of those judgments?

The opinion of the Advocate General of the European Court and the judgment of the Swedish district court are relevant to not only the amendment, but other provisions in the Bill. They draw into question the Secretary of State's statement that the Bill is compatible with the European convention on human rights.

GIP publishes a magazine in Sweden called Gourmet. It is available by subscription and 90 per cent. of its 9,300 subscribers are traders, manufacturers or retailers, while only 10 per cent. are private individuals. The magazine is also available by retail sale. The subscribers' edition of the magazine, which was the subject of the case, contained three pages of advertisements for alcoholic drinks—one page for red wine and two pages for whisky. Those pages were not included in the edition that was sold in shops, which was intended for the general public.

The Swedish ombudsman, who is responsible for consumer protection, applied for an injunction to restrain the publishers from printing an advertisement that was contrary to national provisions that aim to reduce health risks caused by alcohol consumption. The Stockholm district court considered that an interpretation of the provisions of the treaty of Rome was necessary, stayed the proceedings and referred the case to the European Court of Justice for a preliminary ruling.

The publishers of Gourmet argued that the proceedings were based on legislation that was contrary to articles 30 to 37 of the treaty of Rome on freedom of movement of goods and articles 59 to 66 on freedom to provide services. The Advocate General's view was that a ban that extended to advertising in specialist food and drink magazines was disproportionate, which is the essence of the amendment. He found that individuals who chose to read a specialist magazine were highly unlikely to be incited to drink more alcohol as a result of the advertisements, which is partly the point that we made about annual reports. The position of a person who purchased such a magazine was likened to that of a person who had specifically requested advertising material from a producer—in other words, no different to the provisions in clause 4(1)(b) of the Bill.

The Advocate General also noted that commercial advertising comes within the scope of article 10 of the European convention on human rights, which guarantees freedom of expression. Although the applicant did not raise ECHR grounds during the case, the Advocate General said that article 10 was clearly in play—this emphasises the disproportionality of the measure—and the European Court of Justice found that the prohibition on advertising constituted an obstacle to trade between member states, which is prohibited by article 30 of the treaty of Rome. Although such an obstacle could be justified by provisions on the protection of public health in article 36 of the treaty, the European Court of Justice considered that the national court was better able to investigate whether the prohibition of advertising was proportionate and whether the objective could be achieved by less extensive prohibitions or restrictions.

The European Court of Justice also found that although the measure was non-discriminatory, it had a specific effect on the cross-border supply of advertising space and thereby constituted a restriction on the freedom to provide services under article 59 of the treaty although, again, that could be justified by protection of public health under article 56. I am sorry that this is a little technical, but the recent ruling is highly pertinent and requires a response. It had to be decided whether such protection could be provided by measures that had less effect on intra-community trade. It was left to the national court to decide whether the prohibition of advertising was proportionate and whether the objective could be achieved by less extensive prohibitions or restrictions.

Last month, the national court published its judgment. It applied the proportionality test and found that the ban interfered with the free movement of goods and services and that the evidence on the effect of advertising on consumption was inconclusive. Consumption was not increasing and any increase in consumption resulting from the removal of the advertising ban would be negligible, because such advertising had minimal effects, if any. Editorial material is not restricted in any way, and the population is exposed to advertising via the internet, foreign television channels and at the point of sale.

Although the case concerned alcohol, there is a distinct corollary with tobacco. The court therefore concluded that the ban on advertising contravened articles 28 and 49 of the treaty and went beyond what was necessary to achieve any legitimate public health goal. In all substantial respects, the case could legitimately refer to tobacco products.

The relevance of the opinion of the European Court and the judgment of the Swedish national court are of immense importance to the Bill and to the draft directive being considered by the European Council and the European Parliament. The judgments reinforce the necessity that, in human rights terms, although restrictions can be justified on the grounds of public health, any restrictions must be both necessary and proportionate. In the Swedish case, the courts found that they were not. The same could well be found of certain restrictions in this Bill, not least the

prohibition of tobacco advertising other than in publications or communications permitted by clause 4 (1)(a) and (c). We believe that the Bill is vulnerable to successful challenge in the European and United Kingdom courts on human rights grounds.

My amendment goes some small way towards correcting the Bill's excesses. It is inconceivable that publications devoted to tobacco products would be bought by non-smokers, those attempting to give up smoking or children. The Minister referred earlier to retailers who may stock such publications. Members of the public do not generally pick up such things, but those with an interest in the tobacco industry may wish to buy them from a newsagent if they are not available on subscription.

There is no sound reason why specialist tobacco publications for which the United Kingdom is the principal market should be prohibited, but similar publications with large UK circulations for which the UK is not the principal market should be permitted. It is simply anti-competitive and rather ridiculous, which goes to the heart of the problems that we have with this part of the Bill.

The essence of amendment No. 12 is to allow people who have provided written permission for details about tobacco products to be sent to them, to continue to do so on an ongoing basis, without constantly having to repeat that request. That is straightforward. We are dealing with intelligent, informed adults who have an active interest in tobacco products and want details about them. We are not dealing with children or people who may be seduced into smoking or smoking more because of access to a specialist publication.

I am sure that many hon. Members will be familiar with amendment No. 14 because of a letter-writing campaign organised by the Association of Independent Tobacco Specialists. The association has written to many members of the Committee and to hon. Members representing constituencies in which such specialist retailers are based—some 350 establishments. I am happy to table this amendment, which is about cigars and such products, but not cigarettes or hand-rolling tobacco. We are not talking about big fat cat tobacco manufacturing companies that Labour Members seem to have such a downer on, but about a few small specialist retailers who make an honest—and, at the moment, not particularly easy—living. They are legitimately carrying on their businesses, and there is no attempt to close them down. The Association of Independent Tobacco Specialists has not opposed the Bill, but it is worried that, despite the Government's assurances, its businesses will be hit. It also points out that cigar smoking is not prevalent among young people. It is primarily an adult pursuit.

Pete Wishart (Scottish National Party, North Tayside)

Is the hon. Gentleman aware of the Hamlet cigar campaign? It has been formidable in the past few years in trying to attract young adult smokers with certain advertising. I reject the notion that the cigar industry is benign and

that it is simply wants to maintain its existing market. I believe that it is trying to attract new customers.

Tim Loughton (Conservative, East Worthing and Shoreham)

I take issue with the hon. Gentleman, although he made a perfectly legitimate point. I am not aware of cigar smoking being targeted at young people. We have received letters from retailers who say that their businesses are not aimed at that market and I have some sympathy with them.

We have received a letter from a specialist retailer involved with the Association of Independent Tobacco Specialists. It says that it sells cigars, snuff, and pipe tobacco through specialist tobacconists by mail order. It recognises that the Bill is targeted substantially at the selling of cigarettes, especially to young people. However, other specialist tobacconists who sell mainly fine cigars and other non-cigarette products are in a special situation. They do not market to, or attract, young people, but appeal to mature, mostly male, smokers who wish to choose from a wide range of premium products. As specialists who gain more than half their sales from cigars, snuff and pipe tobacco, they are pleased that the Bill will allow them to advertise on the inside and outside of their premises. They fully accept that they will not be allowed to advertise cigarettes or hand rolling tobacco.

The specialists say that the logic of the dispensation has not been extended to mail order and other forms of direct selling of non-cigarette products. Like almost every other specialist tobacconist, such companies also sell fine cigars by mail order and electronically via websites. In many cases—certainly among those who have written to me—that forms a significant proportion of their total trading. Sometimes, direct marketing creates the majority of their total sales.

Specialist tobacconists trade by mail order and via their websites because few specialist tobacconists remain in the United Kingdom. I believe that the figure quoted to me was 350. Many customers cannot visit those tobacconists, because it would be inconvenient in terms of distance or location. Despite the Government's assurance that it is not the Bill's intention to threaten such businesses, many retailers believe that it will. If they cannot use their mailing lists to inform customers of price changes without obtaining individual permission every time, the mail order and website operations will not be cost effective. There will be a knock-on effect, in that the shop side of the business will not be sustainable without the mail order side of the business. Those shops would then have to close. The only beneficiaries will be their overseas competitors.

If those shops go out of business, the people they supply to—specialist cigar smokers—will not all of a sudden say, ''Oh, well, in that case we shall give up smoking.'' They will seek other outlets, and in many cases those outlets will be overseas competitors. We will be hitting small retailers that have legitimate business to do. That has nothing to do with cigarettes or hand-rolling tobacco.

David Ruffley (Conservative, Bury St Edmunds)

Does my hon. Friend think that the Department of Health has consulted the Under-Secretary responsible for small businesses and the Department of Trade and Industry on that issue? It is

clear from my hon. Friend's argument that the provision could be a real blow to the small business sector, which I thought Her Majesty's Government were keen to promote.

Tim Loughton (Conservative, East Worthing and Shoreham)

Yet another inconsistency, as my hon. Friend mentions. I doubt very much whether the Department of Health has taken any regard of the wishes of colleagues and other Departments, as I fear that the Government, despite all their joined-up rhetoric, do not practise what they preach. Another reason why I think so is that the Minister has responded to the Imported Tobacco Products Advisory Council, which sent me a copy of the letter that she sent it.

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

The hon. Gentleman suggests that the Government are inconsistent in wanting both economic development, with a strong, stable economy, and a ban on tobacco advertising. I suggest that the hon. Gentleman reads the speech of the right hon. Member for Maidstone and The Weald (Miss Widdecombe) in the fox hunting debate which, mutatis mutandis, applies to our discussion. There is no inconsistency in wanting jobs but not at any price—not at the cost of health, or animal welfare in that case.

Peter Pike (Labour, Burnley)

Before I call the hon. Member for East Worthing and Shoreham, I shall give the Committee some guidance on what I propose to do as regards time. I know what the two Front-Benchers are hoping to achieve. I propose that we run on. If we have not concluded our proceedings by 6 o'clock, we will adjourn, but hopefully we will have concluded by then. The matter is not completely in my hands, because I do not know if or when there will be Divisions on the Floor of the House.

David Wilshire (Conservative, Spelthorne)

On a point of order, Mr. Pike. That is eminently sensible from our point of view. We thank you for that.

Peter Pike (Labour, Burnley)

I thought that it might be helpful for hon. Members to know what I am considering.

Tim Loughton (Conservative, East Worthing and Shoreham)

The intervention of the hon. Member for North-West Leicestershire had little relevance to the debate, and I am sure that you would have ruled it out of order if we had pursued the subject, Mr. Pike. [Interruption.] It is totally irrelevant because the Government are not seeking to ban specialist tobacco shops, whereas they are seeking to ban fox hunting outright. There is no direct corollary between the two. The Government are perfectly happy for specialist tobacco shops to continue. The amendment would allow those specialists shops to continue mail order selling. In some cases, that amounts to the majority of their business, and without it they would be greatly disadvantaged and their future would be called into doubt.

My hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) is right to suggest that the Minister has had little, if any, contact with other Ministers to take soundings on the subject. In a brief, nay, curt letter that she sent just 10 days ago to the Imported Tobacco Products Advisory Council, she says:

''I am afraid that the Government does not support the amendment you suggest. The Bill therefore bans all direct mail advertising for tobacco products unless the advertisement originates at the request of the customer on each and every occasion. This protects people from being bombarded with advertising material.''

That is a familiar phrase. The ''bombarding'' test has now been imposed on specialist tobacconists, even though there is a particular case for allowing them to sell by mail order. Mail order is not going to attract first-time smokers or children to smoking. It is aimed at a specialist market of people who take up and continue smoking cigars or pipes in full cognisance of what they are doing, and of the implications of it. I fear that the tone of her language and the term ''bombarded'' suggests that she has no sympathy with that. That is a shame, but will the hon. Lady revisit some of the more detailed points raised by the three amendments? I make a particular plea for the specialist small tobacconists to be able to continue their activities, without an obvious effect on the most vulnerable people whom we are all keen to protect. I look forward to the Minister's reply, as I am sure that she has now had time to formulate a response to the Swedish case, given that it came up a few weeks ago. Unless the Government have fully taken that into consideration, it threatens to undermine a great deal of what they are trying to achieve under the Bill, much of which I agree with.

Yvette Cooper (Labour, Pontefract and Castleford)

Amendment No. 11 would create an exemption for specialist publications aimed at existing smokers. Amendment No. 12 would create an exemption for a specialist publication for which people have not withdrawn their request in writing, and amendment No. 14 would exempt anything sent by a specialist tobacconist to an identified individual, who does not have to be an existing customer. I shall explain why the Government oppose the amendments and will take each one in turn.

Amendment No. 11 does not refer specifically to a specialist tobacconist, but says that a specialist publication—by anyone, including major tobacco companies—could be directed at existing adult users of tobacco products. It would allow tobacco companies to send all sorts of publications, as long as they were described as specialist publications, about their products to anyone who is a smoker. That would create a massive loophole. We know that 70 per cent. of smokers say that they want to give up. We also know that tobacco advertising is often targeted at preventing people from giving up smoking or making it more difficult for them to do so.

For example, advertisements are aimed at people during the new year period—exactly when people may be considering giving up smoking. It is not right that, just because people smoke, they should be bombarded—an appropriate word—with advertisements that may make it more difficult for them to give up. Given that tobacco is an addictive product, if people want to try to give up smoking, they should have the right to do so and receive the right support to that end. I strongly oppose amendment No. 11, which would allow tobacco companies to send a tobacco advertisement to existing smokers or users of tobacco products.

Amendment No. 12 would create a slightly less gaping hole. It would allow specialist publications to be sent to people who at some point in their lives had expressed a wish to receive them. Members of the Committee will have continued to receive mail from organisations that they have no recollection of having agreed to, or will have received information because of once filling in a coupon. What about people who may at some time in their lives had wanted to receive a specialist publication, but who had decided three or four years down the line to give up smoking? If such people continually receive advertisements, leaflets with special offers of free gifts and promotional material on tobacco products from tobacco companies, they would find it more difficult to give up smoking. The fact that, at one point in their lives, they had said that they wanted such a communication should not be the green light for them to be sent such communications for years to come. Many people take up smoking and decide later to give up; that is their right, and if they choose to do that, they should be free from tobacco advertising.

Amendment No. 14 raises the issue of specialist tobacconists. We recognise that they face special circumstances, and clause 6—which we shall discuss later—addresses them. They are legitimate businesses, and that clause sets out different circumstances for them.

However, specialist tobacconists should not be able to send out communications to any identified individual, which is what the amendment proposes. That individual does not have to be a customer, or someone who has requested information. That individual can just be someone whose name the tobacconist knows. Their name might have been bought, because companies circulate and share lists of customers, and then they start sending them unsolicited mail, which, in this instance, would, in effect, be a tobacco advertisement. If specialist tobacconists were allowed to do that, it would be a significant loophole.

It is right that specialist tobacconists, like everyone else, should be able to respond to requests by individuals for information about tobacco products, as is set out in clause 4(1)(b). However, it is also right that they should only respond to individual requests, which is why we oppose amendment No. 14.

The hon. Member for East Worthing and Shoreham asked if the decision by the European Court of Justice with regard to Sweden had any bearing on the matter under discussion. It does not. I do not think that anything in the judgment casts doubt on the Bill's compliance with the treaty obligations.

The decision that the Swedish courts made on proportionality and impact addressed alcohol advertising. Alcohol advertising raises different public health issues from tobacco advertising. That is why we are proposing a ban on tobacco advertising in this country, rather than one on alcohol advertising.

David Ruffley (Conservative, Bury St Edmunds)

I am carefully following the Minister's comments. She referred to a European Court of Justice ruling. Will she flesh out her remarks, because she was

talking about the Swedish case, but the judgment relates to the European Court of Justice?

Yvette Cooper (Labour, Pontefract and Castleford)

Two judgments have been made; the first was made by the European Court of Justice, and the second was made by the Swedish courts. The European Court of Justice referred the matter back to the Swedish courts. In effect, the European Court of Justice said that although a law on alcohol advertising, and restricting that to trade journals, was an obstacle to trade between member states, it could be justified on public health grounds, provided that it was proportionate to the objective to be achieved, and it asked the Swedish courts to determine whether it was proportionate.

I do not believe that discussions about the proportionality of banning or restricting alcohol advertising have any bearing on the proportionality of banning cigarette and tobacco advertising, because of the massive health impact of smoking. We have looked at all the proportionality issues, and the impact of tobacco on public health has led us to decide to go ahead with the Bill.

Kelvin Hopkins (Labour, Luton North)

I wish to reinforce the Minister's point about the difference between alcohol and tobacco. I chair the all-party group on alcohol misuse, and I hope that Committee members will not pursue an argument that seeks to compare alcohol and tobacco. Smoking is always dangerous and addictive, but the great majority of people who consume alcohol do so in reasonable quantities; it does not damage their health, and it is addictive to only a minority of them.

Yvette Cooper (Labour, Pontefract and Castleford)

I agree with those points. Alcohol and tobacco create different public health issues, and that is why it is right that we go ahead with this ban and reject the amendments.

David Ruffley (Conservative, Bury St Edmunds)

I do not want to upset the hon. Member for Luton, North (Mr. Hopkins) by unnecessarily pursuing the Gourmet case, as I have a lot of sympathy intellectually with what he said in his intervention and with what the Minister says. Intuitively, there must be a qualitative difference between the adverse public health impact of alcohol and that of tobacco. I shall not quibble and argue that point, but I should like to expose the legal advice that Her Majesty's Government have received on the matter. If the Committee and Ministers are not clear about exactly where they stand legally, the Bill might be defective and subject to legal challenge. I shall not argue about whether alcohol is more damaging and injurious to public health than tobacco. I need not judge the merits of that argument. I am merely testing the legal watertight quality of the drafting in light of the Gourmet case, transcripts of which were made available in English only last week. We are dealing with legal information and rulings that post-date the publication of the Bill. [Interruption.]

Peter Pike (Labour, Burnley)

Order. There is too much discussion in the Committee.

David Ruffley (Conservative, Bury St Edmunds)

Thank you, Mr. Pike.

These are not idle speculations, and they are not meant to be destructive legal speculations. I want to ensure that—

John Robertson (Labour, Glasgow Anniesland)

I wonder whether the hon. Gentleman, with his obvious great knowledge, could tell me whether anyone has ever died of passive drinking.

David Ruffley (Conservative, Bury St Edmunds)

The hon. Gentleman has not listened to a word that I have said, being too busy chuntering away at the back. I went out of my way to concede the point that the hon. Member for Luton, North and the Minister made about the different potentially adverse impacts of alcohol as against tobacco to public health.

With the greatest respect to the hon. Gentleman, I am not trying to argue that point one way or the other. Labour Members may be right. I am trying to expose a slightly different argument. He is perfectly entitled to criticise, but my point is intended to be helpful and to prevent our agreeing to defective legislation or drafting that has not been tested in the fullest sense against current legal opinion. My information and advice may be incorrect, but I am advised that Her Majesty's Government may not have got it right, and I want to expose those arguments so that we do not go down a blind alley.

The Minister said that she believes that the Gourmet case does not pose any problems to Her Majesty's Government in proceeding with the Bill as drafted. However, it might be helpful briefly to remind ourselves of the Gourmet case, the gist of which was that the Swedish district court was unsure whether national rules that imposed an absolute prohibition on certain specialist advertising, to which the debate has adverted, might be regarded as having an effect equivalent to a quantitative restriction within the meaning of article 30 of the relevant treaty, and whether Swedish law was lawful in prohibiting specialist advertising, in relation to alcohol, rather than tobacco. The argument is analogous and has found favour with some legal commentators, who believe that the case may pose a problem for the Bill as drafted.

The district court in Sweden stayed proceedings under Swedish law and referred the questions to the European Court of Justice, which found that, on the restriction of trade and the freedom to provide services, the EC treaty did not preclude a prohibition as specified in Swedish law unless it was apparent that, in the circumstances of law and fact that characterise the situation in the member state involved, the protection of public health against the harmful effects of alcohol can be ensured by measures that would have less effect on intra-Community trade.

On obstacles to intra-Community trade and the freedom to provide services, the key question was the proportionality test. Were the obstacles to such trade proportional when set against the underlying purpose of protecting public health? In other words, the intention of protecting public health was set against the injurious effects of alcohol in the Swedish case. In my view that is on all fours analogous to the

prohibition proffered by this Bill to stop the harmful effect of tobacco on public health.

The European Court found that the ban was too extensive and not proportional as defined by European Community law. As a consequence, the advertising ban in question could not be applied. Legal advice received by the Opposition argues that the ruling has great and wide importance to the Bill and I am advised that that was recognised when the Advocate General gave his preliminary opinion, which was endorsed by the European Court.

The ruling has been a great consolation to the Swedish drinks industry, which sees itself as vulnerable to the type of ban that the Government propose for the tobacco industry in the United Kingdom. The Swedes think that the prohibition that they have been fighting with the specialist drinks industry is of exactly the same type faced by the tobacco industry in the UK if the Bill is not amended.

There is no European directive in force on tobacco advertising. Without one, the Bill sits in much the same legal framework as the Swedish alcohol case referred to the European Court of Justice. We must make it clear to the Minister that the drafting could cause legal problems in relation to proportionality. The Bill could be open to serious challenge. I do not believe that any hon. Member needs to be reminded about the critical importance of proportionality, because it also relates to the European convention on human rights. That is a separate issue, and we do not have time to go down that legal vista.

From the legal advice received by Opposition colleagues, it appears that the Minister owes us an explanation as to precisely what detailed advice legal advisers to the Department of Health have given Ministers in relation to the Gourmet case. Can she give further assurance beyond her general belief that there is not a problem? Although I accept in good faith that there is no problem in her mind, is there a problem in the mind of any legal adviser, or is this a bogus set of concerns and legal commentators and advisers in the City have got it wrong? If that is the case, I should be most grateful for the Minister's reassurance.

Yvette Cooper (Labour, Pontefract and Castleford)

The crux of the hon. Gentleman's argument seems to turn on proportionality. There are 120,000 deaths from smoking each year. Estimates suggest that a ban on tobacco advertising, promotion and sponsorship would reduce consumption by 2.5 per cent. and, in the long term, save up to 3,000 lives per year.

That is a pretty clear-cut public health case in favour of a comprehensive ban.

David Ruffley (Conservative, Bury St Edmunds)

I am grateful to the Minister, but I shall not argue the merits of what she said. I am sure that she is not being deliberately obtuse, and I have great respect for her intellectual powers. However, she answered a question that I did not ask. I am not arguing about whether tobacco is a greater killer than alcohol. My question is more process driven, but it is nonetheless important.

What legal advice has the Minister received from her Department, or from outside it, to suggest that there is no possibility of a challenge on proportionality grounds? Can a legal argument be advanced to support the Government's policy on what proportionality might be? The Minister must have received legal advice on that. The Minister has given the Committee her view, which may be admirable, but the question is legal rather than about policy.

Yvette Cooper (Labour, Pontefract and Castleford)

I understand that the hon. Gentleman is a lawyer and, as such, he will be able to suggest all kinds of legal arguments. However, the issue is about proportionality. The number of deaths that occur each year due to smoking and the number of deaths that could be prevented by a ban on tobacco advertising cut to the heart of the question of proportionality. The numbers give clear evidence of the importance of a comprehensive ban on tobacco advertising that would be wholly consistent with European law.

David Ruffley (Conservative, Bury St Edmunds)

I do not wish to delay the Committee unnecessarily. The Minister could well be right—I shall not argue the merits of her clearly expressed view. Have the lawyers in her Department said, ''Yes, it is very unlikely that there would be any successful challenge on proportionality''? I would not like to be a Minister going forward with the Bill unless I had received legal advice saying, ''Yes, Minister, your view is right and it is clear that tobacco poses a serious threat to public health. It poses a greater threat than alcohol and the Swedish case is completely irrelevant. There is no possibility of a challenge on proportionality appending the legislation.'' I want to hear only simple clarification that the Minister's legal advisers support the view that she clearly articulated.

Yvette Cooper (Labour, Pontefract and Castleford)

I do not underestimate the tobacco industry's capacity to come up with all kinds of challenges to the Bill on any possible grounds. The Committee's purpose is not to speculate on such challenges or the angles from which the industry might approach a challenge. All our legal advice shows that the Bill is drafted in the strongest possible terms to avoid legal challenges and incompatibility with European or domestic law, to ensure that it can be implemented to prevent tobacco advertising, which we want to get rid of in the interest of public health.

David Ruffley (Conservative, Bury St Edmunds)

I do not wish to try the Committee's patience, but we are getting there, as it were. It would be helpful for the Committee to reflect that the tobacco industry may well make a legal challenge. I do not wish to speculate on that although I have no doubt that all sorts of challenges are possible. My question is very specific, and I hope that the Minister will set my mind at rest. Have legal advisors at the Department, or in some other part of Whitehall, advised her on the Gourmet case, and have they said that they do not anticipate any challenges that are made on proportionality grounds by bodies or companies being successful? Were they comfortable giving her that assurance before she went forward with the legislation? Such advice is regularly given to Ministers. I should just like to know whether she has been given any. If she can answer that question, I need not detain the Committee further.

The rest of the debate is in Hansard.