Serious Crime Bill [HL]

moved Amendment No. 83: 83: Clause 27 , page 16, line 28, leave out subsection (6) The noble Baroness said: I shall speak also to Amendment No. 85. This is the first time that I have taken part in our proceedings on the Bill. I was unfortunately unable to attend Second Reading, but I have studied the Hansard record of that debate and of the first day of Committee, and I hope that my presence this evening will not be taken amiss. These amendments and those in the next two groups explore the way in which the Government wish to use the winding-up provisions which apply to companies generally for the purposes of combating serious crime. I should say at the outset that we have no problems in principle with using the winding-up provisions in appropriate cases where serious crime is involved; rather, we wish to explore some of the details. I should express my appreciation to the Association of Business Recovery Professionals, which is more colloquially known as R3, for its helpful advice on these provisions. Amendment No. 83 is a probing amendment. It would delete subsection (6) ofClause 27, which applies to companies registered in England and Wales. Amendment No. 85 would do the same to Clause 28, which applies to companies registered in Northern Ireland. The greater part of Clauses 27 and 28 concerns companies, but subsection (6) of each clause gives the Secretary of State power to apply the Insolvency Act 1986 or, in the case of Northern Ireland, the Insolvency (Northern Ireland) Order 1989, to relevant bodies. ““Relevant body”” is defined in subsection (11). I shall come to that in the next group of amendments. These amendments probe the inclusion in subsection (6) of the words, "““with such modifications as he considers appropriate””." I turned to the Explanatory Notes to find out more about what was intended, but, as is so often the case with Explanatory Notes, they fail to explain what one wants to know about a Bill. The amendments askthe Minister to set out what modifications the Government believe could be made using subsection (6) and why they are necessary. The Minister will know that the power of modification, as drafted, is very wide and seems to apply to the whole of the Insolvency Act 1986. Could this power be used, for example, to modify the way in which preferential debts are determined and paid out under the 1986 Act? Will the Minister say whether and to what extent this power is constrained and how any such constraints are enforced? As I have said, we have tabled Amendments Nos. 83 and 85 on a probing basis. We shall want to consider the Minister’s response very carefully, especially in the light of the fact that the order-making power in subsection (6) is subject only to the negative resolution procedure as set out in Clause 78(6). If the powers are modest, that procedure is appropriate, but if, as seems possible, the powers are extensive, we may want to revisit at a later stage whether the negative resolution procedure is appropriate for a wide power. I beg to move.