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Regulatory Enforcement and Sanctions Bill [HL]

Turning first to Amendments Nos. 134, 144 and 151, we understand the concerns that noble Lords have expressed about the new sanctioning powers being misused. There are of course the important safeguards I have spoken about this afternoon. First, there is a need for regulators to be satisfied beyond reasonable doubt before they can impose a fixed monetary penalty or discretionary requirement. Secondly, for both of these sanctions there will be an opportunity for the business to make representations to the regulator. Thirdly, and perhaps most importantly, the imposition of these sanctions will be subject to the scrutiny of an independent tribunal. While these safeguards will apply in individual cases, there are broader safeguards in the form of the review and suspension provisions that we will come to in Clauses 63 and 64. These will help to address any systemic failings by a regulator. The powers in Part 3 are an alternative to criminal prosecution, but it is for the regulator to determine which route is more appropriate. This is a fundamental component of the Macrory model of regulatory enforcement. Enabling a business to decide how it will be punished could leave the system open to abuse. A business, for example, could wait until a late stage in the civil sanctions process before opting for a criminal prosecution in an effort to delay the enforcement process. Allowing businesses to choose to go down the route of criminal prosecution would also go against another of the fundamental tenets of Macrory: that criminal prosecution should be reserved for the most serious and egregious offences. That can only be assessed by the regulator in view of all of the cases before it. Amendment No. 154 would go a step further and allow a business to opt for a criminal prosecution where a regulator has already imposed a stop notice. Stop notices will only be imposed in strictly controlled circumstances. In particular, there must be a significant risk of serious harm to human health, the environment or the financial interests of the consumers before a notice can be imposed. In light of the sorts of behaviour that these notices are designed to tackle, it would be inappropriate for a business to be able to opt instead for a prosecution, while the serious harm specified in the stop notice materialises. That expresses the Government’s view. We are very grateful, as always, to the trading standards organisation, which has been very helpful throughout the Bill.