Justice and Home Affairs Committee,

Meeting date: Monday, May 22, 2000

Official Report 243KB pdf

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Insolvency Bill

Item 2 is the Insolvency Bill, which is being considered by the UK Parliament. The clerk circulated a note advising that the Insolvency Bill has provisions that affect Scotland and are within the legislative competence of the Scottish Parliament. The UK Government and the Executive have taken the view that it would be more practical and appropriate for the relevant provisions to be dealt with in the UK bill than to have a separate Scottish bill. That is usually referred to as a Sewel motion—or, rather, it is usually done under one. While there will be a Sewel motion in respect of this bill, the committee has an opportunity today to consider the bill before it goes before a meeting of the Parliament.

A detailed memorandum has been circulated, which I hope members have had a chance to consider. The standing orders do not set out a formal procedure for dealing with bills that come before the committee in this fashion, nor is the committee required to publish a report as a result of its discussion today. I am not sure whether members have specific questions to put to the minister. I imagine that a clear political view is likely to be taken on the general issue.

I am concerned about the integrity of Scotland's bankruptcy and debt law. I have not had a great deal of time to consider the matter or to take advice on the impact of clause 13. It seems to me that it is an enabling clause—but I do not quite know what it enables, as regulations will be published on which the leave of Scottish ministers is to be sought.

Minister, have you consulted the Law Society of Scotland and the Scottish Law Commission on the bill? We have no other papers. I would like to know who has commented on the bill—I have received nothing.

At this stage, we have not consulted anyone, but we will have a consultation process to which organisations—

I have had the papers for only a couple of days. I want to be able to consider the comments of external bodies that are interested in Scotland's debt and bankruptcy law on whether the bill removes some of the independence of Scotland's law.

Convener, I have a brief statement that I intended to make, if that is acceptable to you.

Certainly, minister—you should have indicated.

I apologise for that.

I thank the committee for making time available to consider this matter today.

The Insolvency Bill is being considered by the UK Parliament. As it is presently drafted, clause 13 would enable UK ministers to make regulations to implement in domestic law the model law on cross-border insolvency that has been prepared by the United Nations Commission on International Trade Law, which I think is known as UNCITRAL, although I am not entirely sure.

As it is considered that the scope of the UNCITRAL model law extends to matters that are within the legislative competence of the Scottish Parliament as well as to reserved matters, it is proposed to amend clause 13 of the Insolvency Bill so that UK ministers may make the regulations to implement the model law only with the consent of the Scottish ministers.

The Executive believes that that proposal would make the resultant regulations comprehensive and easier to use, particularly for those involved in insolvencies that cross frontiers. The proposal would also give the Scottish ministers a powerful control over the content of the regulations. We believe that that will help to ensure that the regulations will be compatible with Scots law. It is for that reason that I commend to the committee the proposal that is set out in the Executive's memorandum.

I am not sure whether my statement is of assistance—it was intended to be.

I am back on to the regulations—would it be of any use to us to see them? I lack information.

Minister, is there any indication from the Scottish Executive of the timetable for a Sewel motion in the Parliament?

I do not have that information immediately to hand. Perhaps the official with me—[Interruption.] I understand that the Sewel motion has been lodged already.

We can consult members on Christine Grahame's point about the content of regulations. We will make an effort to ensure that members are fully briefed on them and that they have the opportunity to raise matters of concern, if they feel that the proposal contains any such matters.

Today, the committee can either agree that the UK Parliament should legislate on the devolved matters in the Insolvency Bill—or disagree with that action. The minister would, no doubt, take due note of such a decision. Alternatively, we can simply take note of the minister's letter. Unless there are strong views, I think that we should simply take note of the minister's letter. Perhaps the minister will take on board some of the issues that have been raised about information. Individual members are free to contact the Law Society of Scotland directly in the meantime—perhaps the clerk would also like to do so—to obtain the society's views on the bill.