The right hon. Lady leads me to the thrust of my argument on new clause 5, which is the identification doctrine itself. She deals with the precise point of the doctrine. In the Barclays case, Mr Justice Jay at first instance was widely seen as having defined it by a narrow interpretation—I do not criticise the learned trial judge, but many people saw it that way—but the decision was upheld on appeal. With a real-life set of facts, a trial judge made a ruling that had quite important consequences for the law.
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But this issue is not new. The principle was set out in the Tesco Supermarkets Ltd. v. Nattrass case 50 years ago. The directing mind and will principle, which is how it was described in the Tesco case, now needs to be revisited. That is why I have sought, in new clause 5, to look carefully at options 2A and 2B in the Law Commission report. In particular, in the wording of the new clause we have sought to look at other types of liability, most notably the 2007 corporate manslaughter provisions, to ensure that we are faithfully replicating what is already an established principle in statute. I do not seek, through new clause 5, to suggest that there need be a choice for the Government, so that if the Government reform the identification principle the need for “failure to prevent” offences falls away. The two should go hand in hand. Perhaps I depart slightly there from where the Law Commission placed its emphasis in its report.
As the right hon. Member for Barking (Dame Margaret Hodge) says, it is a pretty rum situation when the public prosecutorial authorities of England and Wales are telling us repeatedly that there is a problem with the identification doctrine. Indeed, as she said the current director of the SFO put it in very eloquent American terms. Sir David Green, the former director of the SFO, has said on many occasions that, particularly given the sometimes byzantine structures of very large corporates, he views the concept of directing mind and will as somewhat confusing and very difficult to understand, let alone to present to a jury. I therefore think that the time is now for reform of that identification principle.
There is some concern that a change in the identification doctrine in criminal law could potentially go on to have effects across the piece and create some contradictions
with civil law itself. The Law Commission addressed that point. It took that view that changing the basis of criminal liability in those terms would not have extensive consequences for civil law. I will set out why it said that, because it is important and no doubt Government officials will be giving it some consideration.