Regulatory Enforcement and Sanctions Bill [HL]

moved Amendment No. 65: 65: Clause 20, page 9, line 6, after ““person”” insert ““, or a group of persons having a franchise from the same person,”” The noble Lord said: Welcome to Part 2. This concerns the co-ordination of regulatory enforcement, particularly in relation to primary authorities having influence over branches of large businesses. We all know that the activities of a large business with different branches in different parts of the country can be co-ordinated under this system, but I asked at Second Reading whether businesses operating under franchise arrangements will be subject to the same co-ordination as a business which operates through branches. It is well known that there are many types of this arrangement these days. All kinds of large businesses—McDonald’s, for example—are largely operated through franchises. Although they may appear to the public as branches, each franchise is a separate business with a trading agreement under which it operates. They are allowed to use the name ““McDonald’s”” and everything that goes with it, but they are distinct businesses. In some cases, the branches of a big organisation are literally branches, and some are franchises operating under the same arrangements and using the same brand. I am not convinced whether the arrangements we are discussing should apply across a franchise business, but I am concerned to know whether or not the Bill presently covers franchise businesses. As I read it, it does not. We shall have to rely on the legal experience of the Minister and the other legally qualified Members on both sides of the Committee. A ““person”” can be a company or any other legal entity, but in a franchise business there is a ““person””, a company—I have mentioned McDonald’s—which has an agreement with A, B, C and D, who are individuals trading in different towns. These are different people. They are not the same person as McDonald’s; they are separate persons even though they have an agreement with it. The clause states that, "““a person carries on an activity in the area of two or more local authorities””," and so on. It does not refer to two people carrying on a business under a franchise agreement in two or more local authorities; it says ““a person””. It seems to me, therefore, that a franchise business is not covered by these arrangements. After I mentioned the matter at Second Reading, the noble Lord, Lord Jones of Birmingham, was kind enough to write to me. His letter covered a number of matters but on this point he said: "““I should clarify that the scheme will be open to franchise arrangements that meet the criteria of being regulated in more than one local authority area””." So he says that it will apply; my reading was that it would not. Can the Minister say whether the Government intend it to apply—which I suppose they do, according to the letter from the noble Lord, Lord Jones—and, if so, how they intend to achieve this purpose? I beg to move.