States Meeting Transcript - 10th April 2018

STATES OF JERSEY OFFICIAL REPORT TUESDAY, 10th APRIL 2018

COMMUNICATIONS BY THE PRESIDING OFFICER ........................................ 4

1. Welcome to H.E. The Lieutenant Governor ............................................... 4 The Deputy Bailiff : .............................................................................. 4

QUESTIONS ......................................................................................... 4

2. Urgent Oral Question ....................................................................... 4

2.1 Connétable J.M. Refault of St. Peter of the Minister for Environment regarding .. ...... 4 Deputy S.G. Luce of St. Martin (The Minister for Environment): .............................. 4

1. The Connétable of St. Peter : ............................................................... 4
2. Connétable C.H. Taylor of St. John : ....................................................... 5
3. The Connétable of St. John : ................................................................ 5
4. Senator S.C. Ferguson: .................................................................... 6
5. Senator S.C. Ferguson: .................................................................... 6
6. Deputy J.A. Martin of St. Helier : .......................................................... 6
7. Deputy R.J. Renouf of St. Ouen : .......................................................... 7
8. Deputy M. Tadier of St. Brelade :.......................................................... 7
9. Deputy M. Tadier : .......................................................................... 8
10. Deputy A.D. Lewis of St. Helier : ....................................................... 8
11. Deputy A.D. Lewis : .................................................................... 9
12. The Connétable of St. Peter : ............................................................ 9

PUBLIC BUSINESS – RESUMPTION ............................................................ 9

3. Jersey Consumer Council: appointment of Chairman (P.67/2018) ...................... 9

1. Deputy M.J. Norton of St. Brelade (Assistant Minister for Economic Development, Tourism, Sport and Culture - rapporteur): ................................................ 10
   2. Senator L.J. Farnham : .................................................................... 10
   3. Senator P.F.C. Ozouf : .................................................................... 10
   4. Deputy M.J. Norton: ...................................................................... 11

4. Code of Practice for Engagement between Scrutiny Panels and the Public Accounts Committee' and the Executive' (P.56/2018) ............................................. 12

4.1 Deputy J.A.N. Le Fondré of St. Lawrence : .............................................. 12

5. Draft States of Jersey (Powers, Privileges and Immunities) (Scrutiny panels, etc.) (Amendment No. 2) (Jersey) Regulations 201- (P.51/2018) ............................. 14

1. Deputy J.A.N. Le Fondré: ................................................................ 14
2. Deputy J.A.N. Le Fondré: ................................................................ 14
3. Deputy J.A.N. Le Fondré: ................................................................ 15

5.3.1 Deputy M. Tadier : ........................................................................ 16

4. Deputy J.A.N. Le Fondré: ................................................................ 16

6. Draft Forfeiture of Assets (Civil Proceedings) (Jersey) Law 201- (P.55/2018) ........ 18

1. Senator I.J. Gorst (The Chief Minister): .................................................. 18

1. Senator P.F.C. Ozouf : .................................................................... 19
2. Deputy S.M. Brée of St. Clement : ........................................................ 20
3. Senator S.C. Ferguson: ................................................................... 20
4. Mr. R.J. MacRae , H.M. Attorney General: ............................................... 20
5. Deputy A.D. Lewis : ...................................................................... 21
6. The Attorney General: .................................................................... 22
7. The Connétable of St. John : .............................................................. 22
8. The Attorney General: .................................................................... 22
9. Senator P.F.C. Ozouf : .................................................................... 22
10. The Attorney General: ................................................................. 22
11. Connétable S.W. Pallett of St. Brelade : ............................................... 22
12. The Attorney General: ................................................................. 23

2. Senator I.J. Gorst : ........................................................................ 23
3. Senator I.J. Gorst : ........................................................................ 24

1. Senator S.C. Ferguson: ................................................................... 25
2. Senator P.F.C. Ozouf :: .................................................................... 25
3. Senator P.M. Bailhache : .................................................................. 26
4. The Attorney General: .................................................................... 26
5. Senator I.J. Gorst : ........................................................................ 27

4. Senator I.J. Gorst : ........................................................................ 29

7. Draft Human Transplantation and Anatomy (Jersey) Law (P.57/2018)............... 29

1. Senator A.K.F. Green (The Minister for Health and Social Services): .................. 30

1. Connétable M.P.S. Le Troquer of St. Martin :............................................ 34
2. Deputy M. Tadier : ........................................................................ 35
3. Deputy K.C. Lewis of St. Saviour : ....................................................... 38
4. Deputy L.M.C. Doublet of St. Saviour : .................................................. 38
5. Connétable J. Gallichan of St. Mary : ..................................................... 38
6. Connétable D.W. Mezbourian of St. Lawrence : .......................................... 39
7. Senator S.C. Ferguson: ................................................................... 39
8. The Deputy of St. Ouen : .................................................................. 40
9. Deputy M.J. Norton: ...................................................................... 42
10. The Attorney General: ................................................................. 43
11. Deputy A.D. Lewis : ................................................................... 43
12. Deputy A.E. Pryke of Trinity : ......................................................... 44
13. The Very Reverend M.R. Keirle , B.A., Dean of Jersey: .............................. 45
14. Deputy D. Johnson of St. Mary : ....................................................... 45
15. Deputy S.M. Brée: ..................................................................... 45

LUNCHEON ADJOURNMENT PROPOSED ................................................... 46 LUNCHEON ADJOURNMENT .................................................................. 46

16. Deputy P.D. McLinton of St. Saviour : ................................................ 46

2. Senator A.K.F. Green: .................................................................... 47
3. Senator A.K.F. Green: .................................................................... 52

7.3.1 Senator P.F. Routier: ...................................................................... 53

4. Senator A.K.F. Green: .................................................................... 53
5. Senator A.K.F. Green: .................................................................... 55

1. Senator I.J. Gorst : ........................................................................ 55
2. Senator A.K.F. Green: .................................................................... 55

8. Retail tax: rescindment of States decision (P.62/2018) .................................. 56

8.1 Senator P.F.C. Ozouf : .................................................................... 57

1. Deputy E.J. Noel of St. Lawrence : ....................................................... 64
2. The Connétable of St. John : .............................................................. 66
3. Deputy A.D. Lewis : ...................................................................... 66
4. Deputy M.J. Norton: ...................................................................... 68
5. Deputy G.J. Truscott of St. Brelade : ...................................................... 71
6. Deputy G.P. Southern of St. Helier : ...................................................... 72
7. Deputy J.A. Martin: ...................................................................... 73
8. Deputy J.A.N. Le Fondré: ................................................................ 74
9. Connétable A.S. Crowcroft of St. Helier : ................................................ 76
10. Deputy M. Tadier : ..................................................................... 77
11. Deputy S.M. Brée: ..................................................................... 79
12. The Connétable of St. Peter : .......................................................... 80
13. Deputy K.C. Lewis : .................................................................... 83
14. Deputy M.R. Higgins of St. Helier : ................................................... 83
15. Senator S.C. Ferguson: ................................................................ 85
16. Senator A.J.H. Maclean: .............................................................. 85
17. Deputy J.A.N. Le Fondré: ............................................................. 90
18. Senator A.J.H. Maclean: .............................................................. 91
19. Senator P.F.C. Ozouf : ................................................................. 92

ARRANGEMENT OF PUBLIC BUSINESS FOR FUTURE MEETINGS.................... 97

9. The Connétable of St. Clement : .......................................................... 97

ADJOURNMENT .................................................................................. 98

[9:31]

The Roll was called and the Dean led the Assembly in Prayer. COMMUNICATIONS BY THE PRESIDING OFFICER

1. Welcome to H.E. The Lieutenant Governor

The Deputy Bailiff :

Again, I am sure Members would wish to join me in welcoming His Excellency to the Chamber this morning. [Approbation]

QUESTIONS

2. Urgent Oral Question The Deputy Bailiff :

Before we start again our Public Business, there is an urgent oral question, which has been listed for first thing this morning that the Connétable of St. Peter will ask of the Minister for Environment.

2.1   Connétable J.M. Refault of St. Peter of the Minister for Environment regarding ..

Following the refusal of the application for 65 first time buyer homes in St. Peter , would the Minister advise how many homes have been approved under Policy H5 since 2014 and, if none, will he undertake to review this Policy to ensure that it enables the future delivery of parish-led developments which provide homes which seek to maintain the vitality and viability of those parishes?

Deputy S.G. Luce of St. Martin (The Minister for Environment):

Before I start my answer could I just clarify something, a misunderstanding between myself and my Assistant Minister yesterday? I was in fact in Southampton on States business yesterday and not on a family matter. Policy H5, affordable housing in rural centres within the States-approved Island Plan zoned 2 specific sites for affordable housing. It is envisaged that the total number of affordable houses to be delivered through this policy would amount to no more than 50 units, although it is accepted that other proposals may emerge. The first site in St. Martin was given planning permission in December 2017 for 20 homes and the other site in St. Ouen is also likely to be developed for around 20 affordable homes and no planning application has yet been received. The policy allows for other sites to come forward to support the viability and vitality of Jersey's rural settlement, although to date no formal planning applications for other sites have been made under this policy.

1. The Connétable of St. Peter :

The question I would like to further ask the Minister is, given that the parishes of St. Peter , St. Ouen , St. John , St. Martin and Grouville , currently have in excess of 500 applicants for affordable first-home buyer homes described by the Planning Officer at the independent planning officer hearing as lists of data on a parish hall wall, can the Minister explain what measures his department used to determine in their evidence to the inquiry that no need exists?

The Deputy of St. Martin :

The policy is quite clear and I might read it to States Members: "Establish an authoritative evidence base" is the heading and it reads as follows: "The Strategic Housing Unit will publish an annual housing assessment report, which will provide evidence on current and future numbers of households in need across all housing tenures. This will be matched against the anticipated supply in order to provide the evidence base to support the objectives of the Housing Strategy and inform policy decisions." I have to say that my department has not been formally advised by the S.H.U. (Strategic Housing Unit) that the current supply in housing planned is not currently met with demand. Indeed, the housing unit must recognise this because they have very recently decided that they are going to review these statistics.

2. Connétable C.H. Taylor of St. John :

When I took office I was told there was no waiting list but soon it became apparent that there were parishioners wanting affordable housing because the parish had not done any affordable housing schemes since 1992. A full generation has grown up in the parish and in October 2016 a letter went to all parishioners and I have over 170 parishioners with strong ties to the parish looking for affordable housing. Currently I have a scheme ready to go forward looking for 16 houses and I would like to know with some confidence as to whether this is going to be viewed or whether I am wasting my time.

The Deputy of St. Martin :

I am not sure what the question was, but I will attempt to give an answer. I can only reassert, the Constables who have demand - and I do not dispute that there is demand - need to speak to the Minister for Housing, they do not need to speak to the Minister for the Environment because I have to make a decision on planning applications, I have to follow policy, I have to balance policies, and I need, as it says here, the evidence, which is produced by the Housing Unit, to show that there is more demand than supply and then we move forward. As I have explained to Constables, there are a number of different ways to come forward with applications for these types of schemes, one is to do as we have had from St. Peter , to provide a planning application and test the Island Plan. But be under no illusions, the tests for the Island Plan were considerable in this case. The other one of course is to do, as we have done in the past, is to come to this Assembly and seek to amend the Island Plan, to rezone some sites and move forward in that way. There are a number of different ways of moving forward. But if that demand is there it needs to be properly evidenced and I am not saying that the people coming to the parish halls are not providing that evidence, it is just there is a process to go through, an Island Plan agreed by this Assembly, by which we set policy, by which we allow these sites to move forward and be developed. We need to follow the structure. I would say something else to the Constable, complicated applications, as we know only too well, do not often go through on the first time. We have repeated amendments and we get there eventually and that is what we have to do. I refer Members, before they come back at me again, to the report, and I hope Members have read the report because there is some very interesting stuff in there, and the last thing it says here is that: "The case for St. Peter has not demonstrated to me that there was sufficient justification but rather it would be premature to permit the proposed development ahead of the work already undertaken aimed at providing necessary clarity in respect of the Island's affordable housing needs." That is not a glimmer of hope; that is an indication of where we need to be looking. These sort of applications need to go back, you need to look at the inspector's report, find out where the problems are, challenge those problems, make the changes and come back again.

3. The Connétable of St. John :

Supplementary, just a suggestion, I know a number of my parishioners do not register through the housing scheme because they do not offer houses in the parish. So there is a disconnect there and perhaps that needs to be addressed somehow and this should be examined by the Minister for Housing. But I put that forward as a suggestion ..

The Deputy Bailiff :

This needs to be a question, this is an oral question, it must have the same rules as questions ..

The Connétable of St. John :

Yes, I was going to ask if the Minister agreed with my interpretation. The Deputy of St. Martin :

The Constable has his own interpretation and that may well be correct. But if these people who feel they have demand for property, for houses, are not eligible through the gateway, they need to speak to the Minister for Housing and make sure that they are identified properly and that evidence is brought forward.

4. Senator S.C. Ferguson:

Given the Statistics Department forecast for housing, given the size of the immigration over the past 2 years, which is 185 Le Marais flats - blocks of flats - by 2035, not to mention the occasions where Planning have ignored Island Plan policies, how can the Minister justify the no need for the houses statement?

The Deputy of St. Martin :

In the current Island Plan we know there was a demand for a certain number of houses and the applications that we have are either in the construction at the moment or coming forward at the moment meet that demand. Unless the evidence base - and I refer back to it again - is updated and another number for demand is published, there is no need to change the plan. But I accept, if the evidence base changes, yes, the plan will need to change with it.

5. Senator S.C. Ferguson:

Supplementary. Does the Minister not think that, given the reputation, the very solid good reputation of our Statistics Department, does he not think that he ought to listen to them?

[9:45]

The Deputy of St. Martin :

I take great notice of the Independent Statistics Unit but, as I can only reiterate again, the need needs to be evidence-based and it needs to be published by the Housing Unit officially to myself and the Planning Department before we can start taking a different view of applications.

The Deputy Bailiff :

I have Deputy Martin, the Deputy of St. Ouen , Deputy Tadier and Deputy Andrew Lewis . That will take us well beyond the reasonable time allocated for that, so that will be the limit to questions when they come in now. Deputy Martin.

6. Deputy J.A. Martin of St. Helier :

I am sorry but I have very little confidence in this Minister because when I asked him about the 800 family homes that he had planned in St. Helier , had he spoken to the Minister for Education where the children will go, he said no. I have residents, and I do not know where they are from, they were 800 on the housing list last year, they have now been told, this is not one family, they have been phoned and said: "We are not doing anybody over 800" when the list is now 1,000 families. Where does this Minister think there is no demand? He cannot put the 1,000 homes out there and ..

The Deputy Bailiff :

This must be a question directed at the Minister. Deputy J.A. Martin:

Yes, the question is, he is telling us the Strategic Housing Unit has said there is no need. Has he been in and spoken to them because there is a need, 1,000 on the first-time buyers list that was 800 this time last year, who is not talking to who? Is the Minister talking to anybody else?

The Deputy of St. Martin :

I have said on a number of occasions publicly during my time as Minister that I wanted the Housing Unit to come up with updated figures. I have also said this morning that that has not been done but it is currently work that is underway.

7. Deputy R.J. Renouf of St. Ouen :

I would like the Minister to explain the phrase "sufficient justification" because why can his department not take account of the fact that in St. Peter and in St. John and also in St. Ouen and in a number of other parishes there are lists that have been established of young people who wish to be housed in affordable homes? [Approbation] Why is the Minister saying that it is not up to his department to go and verify these lists; he has to receive his information from the Housing Department? Why can his officers not work with the parishes and satisfy themselves that this need exists?

The Deputy of St. Martin :

There are 2 things to say there, the one is that Ministers for Planning get criticised but they cannot be judge, jury and executioner. The other thing I would say is that we have a system in place, which currently has a proposed way, the way we do our business, the way we come forward with applications, and those need to change. I would like nothing more than to be able to do all this work. It seems crazy to me that I cannot go out and identify a need, and then identify the fields and identify the applicant and go out and build it, but that is not the way the current system operates. Maybe it is time the system was changed; indeed it would be quicker, simpler, and better for everybody. But I would say to the Deputy that he talks about sufficient justification, but I repeatedly talk to Members on this and it is a question of balancing the current policies in the Island Plan, so it is not just about demand, there are 7 other reasons in the inspector's report why this particular application should not be approved, spatial, statutory, sequential approach, protecting the natural historic environment, better by design, general development considerations, affordable housing in rural centres, safeguarding agricultural land, there is a long list of reasons why, if you look at the Island Plan, this particular application needs to be changed before it can be approved. Notwithstanding the demand, notwithstanding the green field that is going to get built on, notwithstanding many of those other things, can Members not see there is an opportunity, if this scheme moves forward, to do a wonderful thing in the heart of St. Peter around a village centre, a village green, an area at the heart of that village there that could be so much better and I said ..

The Deputy Bailiff :

Minister, this is a question and answer and you have run well over the normal time allocated for giving answers. Deputy Tadier .

8. Deputy M. Tadier of St. Brelade :

I am just thinking out loud here but asking: where is St. Helier 's parish housing scheme? It presumably does not have one because it is called social housing in St. Helier . But that is not my question. The question is, to cut to the chase, and I think the nub of this, is the Minister comfortable with green fields and agricultural land being redeveloped, taking it out of agriculture in perpetuity for development of residential housing and is this an indictment on yet another 4 years of continued population failure policy from this, his Government?

The Deputy of St. Martin :

As I have just said, the environmental policy ERE1, safeguarding agricultural land, has a strict presumption against building in the green zone, especially when the green zone in question is a green field of green grass with brown cows grazing around in it. This Minister is keen on protecting agricultural land but this Minister is also a realist and there will be times in the future and I know when we review the next Island Plan there will be enormous pressure on expanding village developments, and I would support that as well because I know only too well how important it is to parishes to keep the vitality in the parish and to keep their young people in the heart of the parish.

9. Deputy M. Tadier :

When there is a net of 1,000 plus people population increase in the Island and that is net, that must mean that there are more than 1,000 new people coming to the Island every year, which far exceeds his Council of Ministers policy of 325, first of all where are these people supposed to be housed and how are people supposed to be linked to the parish and have strong ties to the parish if there 2,000 odd new people are coming to the Island every year? Will they all be housed in St. Helier and the overcrowded urban areas?

The Deputy of St. Martin :

No, they are not all going to be housed in St. Helier. They are going to be housed around the Island but we have a new Island Plan that will come into effect in 2020, we are going to start reviewing on that very shortly. I know, and as I have just said, the villages, the rural parishes, will all come forward and I would support them to come forward with schemes to develop more parish housing in their parishes so their young families with their young children can stay in the parishes and attend the schools. But I say to the Deputy , he goes on about population, there are more people in work, more people in jobs, we do have a housing challenge with finding places for people to live but we are up for that, Andium are doing a great job and we know the private sector continues to come forward with places that will be built for people to live in.

10. Deputy A.D. Lewis of St. Helier :

I know the Minister would like to resolve this problem if he could. He said that maybe the system needs to be changed. I would like to know how did it get this far with this particular application where promises were made, expectations were not met, what has happened with the pre-planning process so that these issues could be identified much earlier so that those people that were so excited about becoming home owners, hopes have been dashed, perhaps temporarily, what happened with the pre-planning advice? The issues that the Minister has raised, surely a lot of those would have come out in pre-planning advice. Why did they not before people's expectations were raised?

The Deputy of St. Martin :

As I indicated right at the beginning, I view this particular refusal and application as the start of the process, not the end of the process. But I would say to the Deputy that we do have some major development companies in Jersey who will not proceed with a planning application until they know they have a scheme, which meets the approval of officers in the department. I do not want to go on and talk too much about the hospital site, but when the first application was refused I sat down with my Chief Officer the next day and I said: "This must never happen again." We must make sure our major States schemes, our major schemes come forward in  such a  way that there is  enough discussion that the application is received and has the support of officers in my department. That would be the best way to move forward and I can only urge people with large schemes to make sure they talk to us. It is always a compromise, there will always be give and take, but the most important thing is that the Planning Department come out with an approval at the end and not a refusal.

11. Deputy A.D. Lewis :

Supplementary. The Minister did not answer the question. So why did the pre-application advice not occur in this particular instance? He is saying that it should have done but clearly it has not. Could he perhaps answer as to why it did not?

The Deputy of St. Martin :

I cannot answer the Deputy 's specific question. The application comes across my desk at the beginning of the process and unless it goes to an appeal or public inquiry it does not come back before me again and it would not be right that it did. So I cannot answer the Deputy 's question but I will go back again and reiterate to officers that we must continue to try to work with all applicants at every stage to make sure that everybody moves forward in the same direction.

12. The Connétable of St. Peter :

If I can just start very quickly and praise the department, particularly one member of the department, the Principal Planning Officer, who worked with us tirelessly from day one, 3 years ago, and took us through every wrinkle, every hoop, and every trough that we had to go through.

The Deputy Bailiff :

Connétable , this does have to be a question. The Connétable of St. Peter :

I will get to it. Just to say that we went through every process, guided by a member of the department  right  the way through. Two words:  one Government - this is  what  we want,  one Government, and to rely on people to come and tell me what needs to be done is not an answer, it is about Government working together, talking to each other.

The Deputy Bailiff :

Connétable , I appreciate your feelings run high, but this is really a speech, it is not a question. Could you please ask a question?

The Connétable of St. Peter :

Sorry, yes. I do not think I have another question for the Minister. The Deputy Bailiff :

Thank you very much.

PUBLIC BUSINESS – RESUMPTION

3. Jersey Consumer Council: appointment of Chairman (P.67/2018) The Deputy Bailiff :

The next item of business is the Jersey Consumer Council: appointment of Chairman lodged by the Minister for Economic Development, Tourism, Sport and Culture. I ask the Greffier to read the proposition.

The Greffier of the States:

The States are asked to decide whether they are of opinion to refer to their Act dated 2nd February 2011 regarding the Jersey Consumer Council and, in accordance with paragraph (b)(ii) of Jersey Consumer Council – future mandate, P.182/2010, to approve the appointment of Mr. Carl Walker as Chairman of the Jersey Consumer Council for a term of 3 years commencing on 14th April 2018.

Senator L.J. Farnham :

Deputy Norton will take this matter.

3.1   Deputy M.J. Norton of St. Brelade (Assistant Minister for Economic  Development, Tourism, Sport and Culture - rapporteur):

As the Assistant Minister for Economic Development, Tourism, Sport and Culture, with specific responsibility for Consumer Protection, before I move to the proposition itself I would like to place on record my sincere thanks to Advocate Rose Colley for her commitment and enthusiasm leading the Jersey Consumer Council as Chair over the last 6 years. [Approbation] I think it would be accurate to say that Advocate Colley has been the driving force in enhancing the profile of the Jersey Consumer Council alongside her voluntary board members and the executive officers and has carried out sterling work in the representing and interests of consumers in Jersey. Some examples, and I will be brief on these: engaging with telecommunications providers, tackling issues regarding such as fibre rollout, roaming charges and bill shock, the introduction of the telco and fuel watch websites, surveying Islanders and organising focus and user groups, and revealing consumer attitudes and experiences on subjects including transport, rental accommodation, primary health, all of which have fed into policy-making decisions. The production of the consumer guides on subjects such as funeral matters, airline and ferry passengers and the rights and energy costs, delivering in partnership with other organisations aspects of the personal social health education curriculum for secondary school children, and active involvement in primary health sustainability projects and of course the organisation of an array of specialist lunchtime talks. Members I am sure will agree that this valuable work carried out for the Consumer Council has been a real asset to our community.  I now move on to  the proposition today, which is  to  seek the approval  of the Assembly to appoint Mr. Carl Walker as the new Chair of the Jersey Consumer Council for a period of 3 years. The recruitment process was overseen by the Jersey Appointments Commission. The quality of those applicants made the job of the selection board extremely difficult. As you may well know, Mr. Walker has now been offered the role subject to the approval of the Assembly today. There is a brief C.V. (curriculum vitae) of Mr. Walker in the proposition; I do not propose to repeat it. I would suspect that many Members here today have either met or know of Mr. Walker most recently as the creator of the Pride of Jersey Awards. It only remains for me to say that I have great pleasure in recommending that Members approve the appointment of Mr. Walker as the Chairman. I am confident that he will lead the Council into a new era where strong consumer representation is more important than ever. I therefore commend this proposition to the Assembly.

The Deputy Bailiff :

Is the proposition seconded? [Seconded] Does any Member wish to speak on the proposition?

2. Senator L.J. Farnham :

Can I just add my thanks to that of Deputy Norton's to the former chair and the staff and the board of the Consumer Council. I also take this opportunity as possibly the last time I will be able to thank Deputy Norton publicly for his work as Assistant Minister in my department and the same; I know it is not directly related, to the Constable of St. Brelade, they have been excellent and supportive Assistant Ministers.

[10:00]

3. Senator P.F.C. Ozouf :

I  would  agree  with  the  Assistant  Minister  that  Mr.   Walker  is  an  excellent  candidate  for  the Consumer Council because he was the individual that led the Jersey Evening Post fair trading or comparative price study that the J.E.P. (Jersey Evening Post) ran for a number of years, which was instrumental. So I wonder whether the Assistant Minister would say whether or not there has been any discussions with the incoming Chairman and the Consumer Council to more closely align, while  keeping  them  separate  more  closely  aligning  the  work  of  the  Jersey  Competition Regulatory Authority, who seem to be completely absent in any understanding of consumer issues, and whether or not that is going to be one of the new driving forces behind the Chairman's appointment?

The Deputy Bailiff :

Does any other Member wish to speak on the proposition? I call on Deputy Norton to respond.

4. Deputy M.J. Norton:

Thank you to the 2 speakers for their comments and with regard to Senator Ozouf 's comments there I know that Mr. Walker has those very subjects in his sights, it is very early yet and has not yet had the approval of the Assembly, so once hopefully that happens I am sure he will get his feet under the table. He has many, many good ideas on consumer issues and, as I have said before, I am sure the Island will benefit greatly from the work that he is going to do and I am sure that will encompass some of that work that at the moment is involved with C.I.C.R.A. (Channel Islands Competition Regulatory Authority). I once again make the proposition.

The Deputy Bailiff :

The  appel  is  called  for.   I  invite  Members  to  return  to  their  seats. Members  have  had  the opportunity to return to their seats. I ask the Greffier to open the voting.

4. Code of Practice for Engagement between Scrutiny Panels and the Public Accounts Committee' and the Executive' (P.56/2018)

The Deputy Bailiff :

The next item is the Code of Practice for Engagement between Scrutiny Panels and the Public Accounts Committee and the Executive, lodged by the Chairmen's Committee and  I  ask the Greffier to read the proposition.

The Greffier of the States:

The States are asked to decide whether they are of opinion to approve the Code of Practice for Engagement between Scrutiny Panels and the Public Accounts Committee and the Executive as set out in the Appendix to the report accompanying this proposition.

4.1   Deputy J.A.N. Le Fondré of St. Lawrence :

I am acutely aware of time pressures today so I shall try to keep this relatively short. This has been a long-standing piece of work for the Chairmen's Committee, partially as a legacy issue that we inherited, but also when we were looking through things it expanded into some other parallel pieces of work, which was aimed broadly at trying to resolve some issues around scrutiny, possibly slightly to raise the standing of scrutiny as well. I will touch on it briefly, I will refer to it under the next piece a little bit, there are some outstanding issues about protection for witnesses who appear in front of scrutiny, because bear in mind it is a parliamentary process and there are issues around parliamentary privilege. We have also had a look at are we slightly deficient, for example, vis-à-vis select committees, for example, in the U.K. (United Kingdom) in terms of powers that they now have that we might not have. Anyway, what then this also resulted in is updating what I am going to refer to as the Engagement Code between Scrutiny and the Executive, so obviously there has been quite a lot of work and consultation with the Council of Ministers, with the Law Officers, with the C.&.A.G. (Comptroller and Auditor General) and the Jersey Audit Office and what we are being asked to approve today is the result. To just touch on some aspects of what is being approved, it is with the support of the Chief Minister and I hope he will nod in accordance with that in a sec. But there is obviously a very clear expectation of co-operation and the provision of information from Ministers and departments to the panels and P.A.C. (Public Accounts Committee) and it works both ways. So to quote the importance of evidence to an effective scrutiny process is recognised by all parties. The process for the provision of confidential information is defined and then we also establish in the Engagement Code a number of what we hope are unambiguous

timeframes for the completion of certain key processes. One other aspect, which I note was commented on in the media very recently, is on page 6 of the Engagement Code at paragraph 12: "The Council of Ministers will use their best endeavours to try to ensure that all propositions on major policies and legislation are lodged au Greffe at least 6 months before the date of the next elections." Now that is "best endeavours"; if there is an emergency that can be overridden very obviously, but the idea is to express an intention that hopefully we better organise our work in the future so that we do not get this kind of concertinaing of important propositions in the last few sittings of the Assembly. It is a step in the right direction to try to manage that flow and that is just expressing the intent there. I think on that point I will stop. It has been a piece of work; we worked quite closely obviously in consultation with all the Scrutiny Panels. There have been various iterations and this is the final piece, which has been agreed with the Council of Ministers as well. On that basis I make the proposition.

The Deputy Bailiff :

Is the proposition seconded? [Seconded] Does any Member wish to speak on the proposition? All those in favour of adopting the proposition kindly show? The appel is called for. I invite Members not in the Assembly to return to their seats. I ask the Greffier to open the voting.

5. Draft States  of  Jersey  (Powers,  Privileges  and Immunities)  (Scrutiny  panels,  etc.) (Amendment No. 2) (Jersey) Regulations 201- (P.51/2018)

The Deputy Bailiff :

The next item is the States of Jersey (Powers, Privileges and Immunities) (Scrutiny panels, et cetera) (Amendment No. 2) (Jersey) Regulations lodged by the Chairmen's Committee and I ask the Greffier to read the citation.

The Greffier of the States:

Draft States of Jersey (Powers, Privileges and Immunities) (Scrutiny panels, P.A.C. and P.P.C.) (Amendment No. 2) (Jersey) Regulations 201- The States, in pursuance of Article 49 of the States of Jersey Law 2005, have made the following Regulations.

1. Deputy J.A.N. Le Fondré:

As I say, this is one of the pieces of work that we were doing when we were looking at the Engagement Code and other matters was the aspect of how Scrutiny Panels operate and putting Scrutiny Panels on to a similar basis where necessary with, for example, select committees in the U.K. and, as I said, there are a couple of aspects that we have touched on. One aspect that came through, which is still outstanding, I just make this as a note of record, is about witnesses appearing in front of panels. As I said, it is a parliamentary process and there are certain protections in place for witnesses who do appear in front of panels. However, there is an anomaly or a gap in part of that protection. That is not what is being debated today. I note as a matter of record it is the type of thought process we have gone through fairly carefully. So what this particular Regulation does is puts us on to the same level as select committees in the United Kingdom, for example, and I believe other jurisdictions, which allows certain witnesses to be placed on oath in front of Scrutiny Panels if necessary. It is anticipated to be used in very limited circumstances but it does raise the standing of Scrutiny Panels up to a select committee. The select committees in the U.K. have had these powers for very many years. On that basis, I make the proposition.

The Deputy Bailiff :

Is the proposition seconded? [Seconded] Does any Member wish to speak on the principles? Those in favour of adopting the principles kindly show? Those against. Very well, the principles are adopted. I am assuming you do not want to call this in?

Deputy J.A.N. Le Fondré:

No. [Laughter]

The Deputy Bailiff :

How do you wish to deal with the matter in Second Reading?

2. Deputy J.A.N. Le Fondré:

En bloc.

The Deputy Bailiff :

There are 2 Regulations, so you propose them en bloc. Are they seconded? [Seconded] Does any Member wish to speak on the Regulations? The appel is called for. I invite Members to return to their seats. I ask the Greffier to open the voting.

The Deputy Bailiff :

Do you move the matter in Third Reading?

3. Deputy J.A.N. Le Fondré:

Yes, and in doing so can I just thank everybody who has been involved, particularly the Chairmen's Committee and if I may in particular single out the Deputy of St. Ouen and the Deputy of St. Mary who, as lawyers, were roped in to look at the detailed wording many times in all of the work that we have done, not necessarily on this one, but also on the Engagement Code as well. On that I move it in the Third Reading.

The Deputy Bailiff :

Is it seconded in Third Reading? [Seconded] Does any Member wish to speak in Third Reading?

5.3.1 Deputy M. Tadier :

It is just on a general principle and it is not a criticism or directly linked immediately, although it is obviously linked sufficiently for me to talk about it in the Third Reading hopefully. It is that we have just seen a strange situation about how Jersey legislation and regulations are made and we know that it is a uniqueness of our system that, not only Ministers, not only the Government can bring forward regulations and indeed legislation, provided there is sufficient law drafting time, but Back-Benchers and the scrutiny function can propose and move legislation and regulations themselves. What we have seen today is the strange scenario where you have the same scrutiny body effectively proposing regulations, which then gets offered for them to scrutinise, and I presume I am not the only one in the Assembly that sees the philosophical and practical problem with that. The scrutiny function, which we all stand up here to defend on a regular basis, relies on the fact that there should be at least demarcation, if not separation, between a Government and non- Government and when we have the non-Government part of the Assembly proposing legislation or regulations, which then cannot objectively be offered to be scrutinised by a separate body, that does pose a problem. So again it is not only linked to this particular motion today, but generally I think these issues need to be looked at and I suspect it means that either we start to do things completely properly, where in the future only Government can bring forward certainly legislation, or we look at a system of who can bring what. So I just raise that perhaps at this juncture, which might be appropriate, before the new Assembly convenes in May or June.

The Deputy Bailiff :

Does any other Member wish to speak in Third Reading? I call on the Chairman to respond.

4. Deputy J.A.N. Le Fondré:

Deputy Tadier to an extent does have a point. I would say I was asked in 2 capacities because obviously I am proposing the Regulations as Chairman of the Chairmen's Committee and I was being asked I believe in my capacity as Chairman of the Corporate Services as to whether I wish to scrutinise it, so it was 2 different hats that were being worn at that point. But Deputy Tadier does have a point. He will know that the Chairmen's Committee have made representations in terms of the overall legislation process to P.P.C. (Privileges and Procedures Committee) and obviously we will see how that goes in terms of the length of time, because I think we all do accept this was the slight anomaly, I only found out relatively recently that it would be referred to me, but wearing a different hat obviously. I did have that internal discussion with myself as to whether it might be appropriate to call it in or not, but I concluded it was not worth it. But more seriously the legislation process, and in terms of the speed of legislation, which it goes through, particularly on complex matters, this is a very simple matter, is important and the one plea I would make is that one has to allow time, we know there is this issue, there is certainly a move I believe to allow what we could call in at a First Reading stage, which I think is important; that is almost at the principles stage. But it is allowing sufficient time in both of those stages because certainly in the last few months there has been a lot of pressure on complicated legislation coming through and the ability of scrutiny and the resources and capacity of scrutiny to handle the volume that has been coming through. Part of that is covered in the Engagement Code that I just talked about, which is trying to avoid this kind of compression, because scrutiny can do it provided it has time. But I just make that point and I move the Regulations.

The Deputy Bailiff :

All those in favour of adopting the Regulations? The appel is called for. I invite Members to return to their seats. I ask the Greffier to open the voting.

Deputy J.A.N. Le Fondré:

Can I just take the opportunity, I did not specifically mention them, I referred to them, just also to thank obviously the Officers involved in doing the 2 pieces of work that we have just voted through. Thank you.

6. Draft Forfeiture of Assets (Civil Proceedings) (Jersey) Law 201- (P.55/2018) The Deputy Bailiff :

In accordance with notification given to the Assembly yesterday, the Chief Minister has deferred P.54, and so the next item of business is the Draft Forfeiture of Assets (Civil Proceedings) (Jersey) Law lodged by the Chief Minister and I ask the Greffier to read the citation.

The Greffier of the States:

Draft Forfeiture of Assets (Civil Proceedings) (Jersey) Law 201- A Law to provide for the seizure and forfeiture, by way of civil proceedings, of cash and other assets suspected to be property originating, or intended to be used, in unlawful conduct; to confer powers to investigate into the nature, ownership, extent and whereabouts of such property, including powers to search, to require information, and to monitor bank accounts; to create offences of obstruction of, and interference with, such investigations; to compensate owners of property wrongly seized or forfeited; and for connected purposes, the States, subject to the sanction of Her Most Excellent Majesty in Council, have adopted the following Law.

[10:15]

1. Senator I.J. Gorst (The Chief Minister):

The Draft Forfeiture of Assets (Civil Proceedings) (Jersey) Law introduces a civil forfeiture regime for Jersey by replacing and extending the current Proceeds of Crime (Cash Seizure) (Jersey) Law 2008 to create a civil forfeiture procedure that would apply to both cash and property held in bank accounts. Freezing and confiscating of tainted property derived from criminal activity remains a key priority for Government in its general commitment to the worldwide fight against financial crime. Following MONEYVAL's onsite inspection of Jersey in 2015, Members will be aware that a Report was published in May 2016, which contained a number of recommendations. The MONEYVAL evaluation team recommended that Jersey could consider the introduction of a non- conviction-based confiscation regime to apply in parallel with the conviction-based scheme. The Government, advised by the Financial Crime Strategy Group, has decided to act on this recommendation, particularly as the 2012 Financial Action Task Force Recommendations and 2013 Methodology place greater emphasis on effectiveness of a financial crime regime. In practice this means to what extent jurisdictions are able to deprive criminals of illicit property. Since the MONEYVAL report, my department in conjunction with the Attorney General's Chambers has been working on this draft legislation to introduce a non-conviction based confiscation in Jersey. The draft legislation has been subject to extensive formation and consultation over the past 2 years, resulting in the legislation we have before us today. As I have said, the legislation proposes to replace and extend the current Proceeds of Crime (Cash Seizure) (Jersey) Law 2008 to create a civil forfeiture procedure that would apply to both cash and, critically, property held in bank accounts. Non-conviction-based confiscation regimes are common in a number of jurisdictions around the world and this legislation has been formed with reference to similar regimes that exist in both the U.K. and Guernsey. They provide a judicial mechanism for authorities to make an application to confiscate assets, where potentially due to an inability to obtain evidence to reach the criminal standard for prosecution, i.e. beyond reasonable doubt, it would not be possible to confiscate such assets. A common use of these regimes may be to confiscate funds that have been frozen for a significant period of time by a bank after a suspicious activity report, known as a S.A.R., has been filed. These situations arise where an account holder may have simply abandoned the funds and has made no attempt to prove their legitimacy further to requests from the bank. It is important to note the judicial mechanisms proposed in the draft legislation incorporate important safeguards to address the rights of the individual in respect of property. As to the structure of the legislation, the

draft law introduces 3 procedural tracks for the operation of the regime. These are (a) preservations of the existing procedure for tainted cash under the Cash Seizure Law; (b) a procedure for the summary forfeiture of property in bank accounts which has been subject to a "No Consent" by the Joint Financial Crime Unit for a period of 12 months; and (c) a procedure for the forfeiture of property in bank accounts which is otherwise suspected to be property that is the proceeds of unlawful conduct or is used/intended to be used in unlawful conduct. I am grateful to the Attorney General and his Chambers for all the support that they have given in bringing forward this legislation. I am also grateful to the Economic Affairs Scrutiny Panel for their involvement and the briefings and the questions that they have provided to officials and the Attorney General and his Chambers through this process. I understand, but no doubt they will say otherwise, that they are broadly content for the legislation to proceed today. I see the proposed introduction of this regime as an enhancement of an already well-functioning system for prevention of financial crime in Jersey. This is evolution and a development of our regime. Overall, this legislation looks to act or acts to reinforce the existing leading position Jersey holds worldwide on the prevention of financial crime and I hope Members will give it their support. I propose the principles of the legislation.

The Deputy Bailiff :

Are the principles seconded? [Seconded] Does any Member wish to speak on the principles?

1. Senator P.F.C. Ozouf :

Without wanting to prolong this debate, I do want to ask the Chief Minister, because there is an important issue, which has been raised in recent weeks concerning the potential arrangements for the forfeiture of assets from so-called oligarchs and indeed I have seen the front page of the Jersey Evening Post today, it is the Evening Post, but it is still the morning, and the front page has a story in relation to a number of companies that are based in Jersey linked with criminal Kremlin-based oligarchs. Questions that have been put particularly to the Attorney General, who may wish to just deal with this, because this is the right and appropriate time to do it; the Chief Minister will recall that I asked specifically what arrangements there could be in Jersey for a so-called Magnitsky Act, which had the objective of effectively seizing assets from named individuals. Now I understand that this law would be a way of achieving the objectives of the Magnitsky Act in the United States, which has been replicated in Canada and a number of other places. I wonder whether or not in his remarks or whether the Attorney General could explain to the Assembly the linkage between what the purposes of Magnitsky Acts in other jurisdictions have with this law that is before us because it seems to me that outwith an extension, which may be considered necessary in future, which is this law deals with just cash, that if that was to be extended to other assets types then we would have effectively the vehicle should the international community and particularly the U.K. Government name individuals that would be subject to the concerns raised by the promoter of this legislation in a number of jurisdictions, then we would have the necessary legislation in order to achieve those objectives. Because I think that is a really important issue. This is not called a Magnitsky Act but I would like the Attorney General or the Chief Minister to say whether or not it could be, if it would be widened, it could be used for the purposes of that, but we are not a self-determining jurisdiction and we would have to take those lists from other places, particularly the U.K.

The Deputy Bailiff :

Senator, do you wish the Attorney General to answer it, because he will only answer it if you specifically ask?

Senator P.F.C. Ozouf :

I will leave it to the Chief Minister and the Attorney General, the Chief Minister is capable of answering, but if he needs to have the Attorney General, who gave a very helpful written answer to my question yesterday.

The Deputy Bailiff :

Does any other Member wish to speak on the principles?

2. Deputy S.M. Brée of St. Clement :

The Chief Minister was quite correct in saying that the Economic Affairs Scrutiny Panel had a number of briefings and meetings with the Attorney General on this. The panel at first had an issue with non-conviction-based forfeiture because it goes against the principles of the law under which we live, which is you are innocent until proven guilty. However, it was explained to us by the Attorney General at some length that what this is dealing with is the fact that every opportunity will be given to the account holder to prove that the funds sitting in that account are not the result of criminal activity or are not intended to be used for such activity. It was really this understanding of effectively going, well if a freeze order effectively is placed on an account in a bank in Jersey, you are saying to the account holder: "You have to prove you are innocent." Now that is a difficult concept to get one's head around. However, it was felt by the panel that, while we still have perhaps minor concerns in that area, we are not qualified lawyers; we are not practised in the art of court cases and understanding the procedures. The Attorney General was very clear that at all stages throughout the procedure the account holder has the opportunity to prove that the money sitting in the account is free of any criminal activity. With regards to the question of what does this cover, again it was questions that we asked of the Attorney General, and I am sure either the Chief Minister or the Attorney General will be able to clarify this point, the draft law talks about property held in an account. Now it is possible that in a safe custody account shares can be held, bonds can be held, so this law, as the panel understand it - and certainly I understand it - does extend beyond pure cash, provided that property is held in a transferable form. It is important I feel that we do also look at this in a much wider context than just possibly Jersey. It is important that Jersey is at the forefront of being able to deal with criminal activity. It is important that Jersey has the right legislation in order to deal with situations that may arise. There will be situations that will arise in the future and I think we have to accept that and I think that it is an important part of the overall legislation that Jersey has available to it. We have the Cash Confiscation Law at the moment, which I have to say I was not aware of until I got a briefing from the Attorney General on it. This fits with that. Unless we understand that we have to protect Jersey's reputation worldwide and this goes to doing so, this goes to proving that we have the right set of legislation that a well-regulated finance industry has. Therefore, despite my initial misgivings on this, despite my initial thoughts that a non-conviction-based legislation was fundamentally wrong, I am going to be supporting this proposition.

3. Senator S.C. Ferguson:

I have concerns about this legislation. In the United States, if your assets are seized under their version of this law, it tends to be final and it is difficult, if not impossible, to get your assets back. There have been a number of cases of this where people have been driven into bankruptcy because they happen to have won x-thousand dollars in Las Vegas and it is just taken. Sadly, we do not appear to have any comments or a report on this from scrutiny and I would be grateful for the Attorney General's comments that it is impossible for this to occur under this law in this jurisdiction.

The Deputy Bailiff :

Attorney, are you able to assist at this point, given that the question now is directly put to you?

4. Mr. R.J. MacRae , H.M. Attorney General:

Yes, perhaps I can assist in relation to one or 2 issues that have been raised by more than one speaker this morning. To answer the point that I think Senator Ferguson raised, and also I think that Deputy Brée touched on as well, it is right that there can be no forfeiture under any of the 3 sets of procedures laid out in this law without notice being given to the account holder or the person from whom the cash was seized and a court hearing. As I told scrutiny, in each case the court would ensure that there was adequate time given to any person the subject of a potential forfeiture order in respect of the assets potentially attributable to them between notice given to them and the court hearing taking place.

[10:30]

Further, there would be a right of appeal in each case to the Court of Appeal. Overall, we are clear that the structure of the Law is human rights compliant. It is in some ways not a revolutionary Law in that it is an extension of the principles contained in the Proceeds of Crime (Cash Seizure) (Jersey) Law 2008, which has worked successfully for the last 9 years in relation to seizing tainted cash, usually in large sums from vehicles leaving the jurisdiction, which are believed to be the proceeds of drug trafficking. In relation to the general principle of non-conviction-based forfeiture, I should reassure Members, as I did scrutiny, that this is not a shortcut to forfeiting tainted assets in the sense that if there is evidence, which can be used for the purpose of a prosecution, then the preference of the authorities would be to prosecute a case, convict the offender, and obtain confiscation orders in the usual way. But the reality is that we are an Island and a finance centre and with the best will in the world sometimes it is difficult to secure the documents, the evidence, the witnesses, and even the suspect, all of which are required to put someone on trial in Jersey. As we saw 2 years ago in the Windward case it took 9 years and assistance from 12 other jurisdictions to produce the evidence and documents and witnesses to secure a conviction. So there are cases where cash is held in Jersey accounts, often, it is one of the main points of this law, under an old suspicious activity report filed by a bank or trust company on the police, there is no consent given by the police to pay the funds away, and in those circumstances the funds can be left for a period of years with the purported account holder knowing that these funds are tainted, the bank knowing these funds are tainted, but the authorities being powerless to do anything in relation to those funds. This Law will cure that problem but also provide in every case for the bank and the account holder to have notice of any application to forfeit the funds in question. Finally, in relation to the Magnitsky Act issue, that of course is a development arising in recent years, arising I think out of the death in custody of a Russian citizen who was exposing fraud I think in Russia, and the principle adopted by I think 6 jurisdictions now is to ensure that those jurisdictions have legislation in place to ensure that the proceeds of Human Rights abuses conducted by Government officials stand to be confiscated in the jurisdictions in question. In England and Wales that has been dealt with by an amendment in 2017 to their Proceeds of Crime legislation, which came into effect in January of this year, and what they have done in that jurisdiction is to provide that the proceeds of unlawful conduct are expressly extended by statute to incorporate any monies, which are connected to gross Human Rights abuses or violations. Plainly that new statute is something, which we have not had the chance to examine yet in Jersey in respect of its usefulness or the extent to which it may cover assets, which are not covered by existing legislation in Jersey. But one thing I can say, and I have said in the answer, which I filed yesterday, is that, although the new Law in front of the Assembly today does not refer to gross Human Rights abuses or violations, the fact is that the definition of unlawful conduct and tainted property within this law is in my view wide enough to include gross human rights abuses and violations in other countries because all such conduct would amount to unlawful conduct as a matter of Jersey law as it currently stands. But, nonetheless, if there is any evidence of property being held in Jersey, which might be covered by wider legislation, then of course that will be looked at urgently by my department and of course by the Chief Minister. I hope that answers the questions that I have been asked this morning.

5. Deputy A.D. Lewis :

Can I just ask a question of the Attorney General while he is on his feet? Attorney General, are you saying that there already exists a number of bits of legislation under the Proceeds of Crime Law that currently we have in place that enables assets to be seized already and in effect frozen? So what is it that this legislation does that does not already be achieved by other Proceeds of Crime regulations and legislation?

6. The Attorney General:

The current legislation in relation to tainted property seized domestically, where there is no criminal proceedings afoot here or in other jurisdictions, is limited to cash only. There are provisions in relation to interim seizing or forfeiture of assets in Jersey of any nature in relation to domestic criminal proceedings or foreign criminal proceedings, but in the absence of foreign criminal proceedings or domestic proceedings there is currently no mechanism to seize and forfeit tainted assets, which are not cash. This Law extends the Cash Seizure Law to property held in bank accounts, which currently cannot be the subject of any proceedings in relation to forfeiture of such assets absent any criminal prosecution in Jersey or another jurisdiction. I hope that answers the question that Deputy Lewis asked.

7. The Connétable of St. John :

Yes, to the Attorney General, mistakes do happen and if assets are forfeited it is simpler in the case of cash but where they are other assets, which are prone to market fluctuations, if it is proved that they were not tainted, is there a process of compensation due to market fluctuations for the value that the true owner might or might not suffer?

8. The Attorney General:

There are compensation provisions under the Law at Article 30 and there is always, in relation to the situation where perhaps someone did not discover the forfeiture proceedings because they were not notified, perhaps they were somewhere else or did not receive the correspondence, or for any other reason there is an injustice, there is always the opportunity to appeal to the Court of Appeal out of time in relation to assets that might theoretically be wrongly forfeit.

9. Senator P.F.C. Ozouf :

I am extremely pleased to hear what the Attorney General says in his answer, it is going to be a huge comfort to people to hear that the Magnitsky Act provisions could be extended with such a piece of legislation for us. Except, I wonder if the Attorney General could explain in clearer terms, if I have not understood it, the definition of "assets" because the provisions of the equivalent Magnitsky Acts do cover non-cash property and this law does only deal, as I read it, with the assets held within a bank account, must therefore be cash. So could he just explain exactly what the development could be and what this definition again of "assets" is, because I do not think it is clear.

10. The Attorney General:

The current legislation, the Cash Seizure Law, only applies to cash. Although the definition of property within the definition section in this law is wide, the forfeiture provisions under Parts 3 and 4, which deal with non-cash items, only apply to property held in bank accounts. If in due course it is thought that we need to widen the scope of property caught by this law then there will need to be an amendment to the Law.

11. Connétable S.W. Pallett of St. Brelade :

Just on the issue of compensation the Constable of St. John has just brought up and the Attorney General has mentioned Article 30, I know it is unlikely or very rare that mistakes will be made, but in regards to Article 30, there are reasons given in regards to considering compensation and one of them is: "(c) Any other relevant circumstances." I just wondered whether the Attorney General could say whether that included damage to the character or damage to the reputation of a business for example, because some of the people that might be involved with this could be very wealthy and any potential compensation could be quite high. In regards to that, the compensation ordered to be paid under this Article is to be paid by the States. So I want to know if there is any limit to the liability of the States in regards to any compensation made and how will it be paid? Would it be automatically paid by the Treasurer or would it be paid though a States proposition? I just want to know how compensation would physically be paid. If it was a States proposition clearly it would be for this Assembly to decide, but just interested in how that would be paid.

12. The Attorney General:

The compensation would be paid by the States, the amount is not limited, but the Members will see that compensation is only payable in circumstances where there is evidence of bad faith. As to the Constable's question in relation to the reputation of a business, the court is entitled to take into account other relevant circumstances and I daresay that might, in appropriate circumstances, include that consideration.

The Connétable of St. Brelade :

Can I just ask, in terms of how would that be paid, would it be a States proposition or would it be purely a decision of the Treasurer?

The Attorney General:

It would be payable pursuant to a court order by the States.

The Deputy Bailiff :

Does any other Member wish to speak on the principles? I call on the Chief Minister to respond.

2. Senator I.J. Gorst :

I am not sure if it is a good sign that we have already started to discuss the details of the Articles on the principles or not. I am of course extremely grateful to the Attorney General for his clarificatory remarks. I am not sure there is a great deal more for me to answer. With regard to Senator Ferguson perhaps I could just further confirm that there are safeguards throughout the Law that we will come to in the Articles. Authorities will have to apply to the courts with the owner of course being able to apply to the court for return of those assets as well. There is a proper and reasonable notification process and time periods granted to the owner. Senator Ozouf is right that this law does cover some of the provisions in the Magnitsky Act but there may, in due course, as the Attorney General suggested, be a need, and that need is looking greater perhaps post the U.S. (United States) issuing its Treasury Notice than it might have done before, with regard to an extension and a clarification that Human Rights breaches are included and potentially also a need to extend for the asset classes as well. But, as Deputy Brée said, this is an important piece of legislation. It will maintain us at the forefront of those jurisdictions following evolving standards and showing that we can maintain the very highest standards here with the appropriate safeguards as well. We are not absolutely at the forefront because, as we said earlier, others have got similar provisions, but it maintains us in the front line of jurisdictions, which is something that I think right across this Assembly we agree is absolutely necessary and is in our best national interests, so I maintain the principles. I call for the appel.

[10:45]

The Deputy Bailiff :

The appel is called for. I invite Members to return to their seats. I ask the Greffier to open the voting.

CONTRE: 0  ABSTAIN: 0

The Deputy Bailiff :

Deputy Brée, presumably your panel, having spoken, does not wish to .. Deputy S.M. Brée:

No, we do not.

The Deputy Bailiff :

How do you wish to deal with the matter in Second Reading?

3. Senator I.J. Gorst :

We are looking as though we are going to, today, enjoy an abundance of time. It did not quite look like that when we started. I will endeavour to, because it is an important piece of legislation, keep it .. not be too lengthy in my explanation but it does need to be given appropriate justice. So, if I take the 3 parts separately .. sorry, 5 parts, I shall endeavour to address them now, I think, all en bloc and then we can answer any questions as we go through. So, part 1 provides for the

interpretation of the law. Part 2 replaces and updates the provisions of the Proceeds of Crime (Cash Seizure) (Jersey) Law 2008. Part 3 deals with the new procedures introduced by the regime for the forfeiture of tainted property which, in summary, may occur in one of 2 ways. First, as provided by Article 10, the Attorney General may, where there are reasonable grounds - and that is important, reasonable grounds - to believe that property held in a bank account in Jersey is tainted property and a suspicious activity report has been made, serve a notice on the holder of that account. In relation to property which is suspected to have been tainted but which, in respect of no report of suspicious activity having been received, the Attorney General may apply to the Bailiff under Article 12 for a property restraint order prohibiting withdrawal, transfer or payment out of the property specified in the order. As I said, there are a number of important checks and balances in the legislation. Article 16 confers rights of appeal against forfeiture orders. Article 17 makes provision as to the inter-relationship of property restraint orders and forfeiture orders with proceedings for bankruptcy. Part 4 confers additional investigative powers on the Attorney General and authorised officers in connection with several forfeiture investigations defined by Article 18. Articles 19, 22, 23 and 24 provide for the making of, respectively, production orders, customer information orders, account monitoring orders and disclosure orders. Article 20 sets out the circumstances in which the Attorney General, or an authorised officer, may apply for a search warrant in relation to premise on which it is suspected there may be material of substantial value in relation to a civil forfeiture investigation. Part 5 of the law makes miscellaneous general provisions. Article 26 provides that proceedings, except offences, under the law are civil proceedings to be determined on the balance of probabilities. Article 27, again, is a check and balance which enables victims of crime who have been deprived of property which is the subject of proceedings under this law to apply to the court for that property to be released to them, prior to the making of any forfeiture order in respect of the property. Articles 28 and 29 limit the liability of the Viscount and the Attorney General, respectively, in carrying out their functions under the law, unless any act is done in bad faith. We discussed this in the opening principles, under Article 30, provision is made for compensation to be payable where a person has suffered loss as a result of an act done in bad faith, which, I think, is slightly different from what the Constable of St. John was trying to ask of the Attorney General, so it is important that Members are aware of Article 30. Article 31 creates a general offence of obstructing the Attorney General or an authorised officer in the lawful exercise of powers under the law, punishable by imprisonment. Article 32 creates an offence of tipping off. Article 33 makes general provision as to liability of directors and similar officers of certain bodies for offences committed by those bodies. Article 34 confers power on the court to consent to settlement of proceedings under various Articles and Article 35 makes a consequential amendment to the Civil Asset Recovery (International Co-operation) (Jersey) Law 2007, and Article 36 effects the repeal of the Proceeds of Crime (Cash Seizure) (Jersey) Law 2008. Article 37 is the citation. I will endeavour to answer any questions and of course lean heavily upon the learned Attorney in doing so. Thank you.

The Deputy Bailiff :

Are the Articles seconded? [Seconded]

1. Senator S.C. Ferguson:

Going on a bit from the Constable of St. John 's comments. What happens if, under Article 17, an individual is made bankrupt by the forfeiture of assets and then it turns out that the forfeiture was incorrect and the assets are refunded but it is too late, he has got the stigma of having been declared bankrupt; what happens then?

2. Senator P.F.C. Ozouf ::

I wonder if the Chief Minister could comment on whether or not he will, as a result of this debate and the remarks of the Attorney General, bring forward a further extension of this law that covers those assets that were clearly explained by the Attorney General in the debate on the preamble that ensures that the Articles are updated to recover other forms of assets. In doing so, in his opening remarks he explained the relevance of the international community, it was the I.M.F. (International Monetary Fund), I think, oversight group that was responsible for advising this step to be taken and I am familiar with that. Would he confirm whether or not the recommendations of the I.M.F. would be .. it would be compliant with those recommendations to extend the definition of "cash"? Or the Attorney General could answer that as well being the expert.

3. Senator P.M. Bailhache :

I rise only to follow up, I think, the interventions of Senator Ozouf in relation to the Magnitsky Act and also the intervention by Senator Ferguson. I remember when I held the office held by the Attorney General, many years ago, that I had a conversation with a very senior police officer from the States of Jersey Police who had just returned from a visit to Florida. In Florida he had been taken by the United States police to inspect a whole row of the most wonderful fast speedboats that were then in the custody of the United States police authorities. The Jersey police officer said: "How on earth did you get hold of those wonderful boats which are obviously very useful to pursue drug traffickers?" who were at that time, probably still now, conveying drugs from South America into Florida. The police officers explained the new United States legislation which allowed property to be forfeited and in default of any explanation from the purported owner of the property, that it was bona fide property and not the proceeds of crime or being used to assist in crime in some way, then that property could be forfeited to the authorities. I was thinking of that when Senator Ferguson was making her speech because I am not sure that this law goes far enough. I would like the Attorney General or Chief Minister, if he would like, to deal with it but alternatively the Attorney General to tell me whether I am correct that although tainted property is defined sufficiently widely to enable it to embrace things like fast speedboats used to convey drugs and therefore that that property could be the subject of a forfeiture order. When it comes to the question of restraint, the restraint only bites upon moveable property which is contained in a bank account, and so that in theory such a fast speedboat could be moored in St. Helier harbour but could not be made the subject of a restraint order, what used to be called a saisie judiciaires, I think, although it could ultimately be subject to a forfeiture order made by the Royal Court. I do not know whether this was a deliberate odyssey decision, it might have been for good reasons. But I wonder if the Attorney General could explain whether I am correct in the provisional conclusion that I have drawn and whether this issue was the subject of any discussion and whether, in fact, it might be the subject of further discussion particularly in the light of the interventions made by Senator Ozouf in connection with property shown to be the proceeds of human rights abuses or other criminal activity.

The Deputy Bailiff :

Does any other Member wish to speak in Second Reading? Chief Minister, do you wish the Attorney to address these points or do you wish to address them yourself?

Senator I.J. Gorst :

It would be rude of me to stand when the Attorney is already standing, Sir. The Deputy Bailiff :

Yes. [Laughter] Attorney, are you able to assist the Assembly?

4. The Attorney General:

Perhaps I am the rude one there. Dealing, if I may, with 2 of the points that are raised, the point that Senator Ferguson raised in relation to Article 17 of the draft law in relation to bankruptcy, perhaps I can explain what Article 17 does or is supposed to do. It is not supposed to deal with a circumstance where someone is made bankrupt as a consequence of an order made under the law. It is simply to ensure that where a property restraint order, which of course is an interim order that can be set aside on the application of a person, effectively is made in relation to property, and the person who is connected to that property subsequently becomes bankrupt then that property is ring- fenced from the estate of the bankrupt in his bankruptcy. Moving on to the point that Senator Bailhache made, yes, he is absolutely right in his analysis of the law. Can I indicate that of course saisie judiciaires are still sought and obtained under the Proceeds of Crime Law where there are criminal proceedings extant in Jersey or indeed in other jurisdictions and orders are made in this jurisdiction in aid of those foreign criminal proceedings.

[11:00]

Such orders can and do extend to speedboats, cars, property of all nature, fine wine and so on, which is held in Jersey. He is right that this law extends principally, indeed exclusively in terms of forfeiture, to cash and property held in bank accounts. It was not a mistake it was a deliberate policy decision to focus on assets held in the finance industry, in its broadest sense, through banks that were tainted. But speaking for myself, although it is principally a matter, of course, for the Assembly in due course, I am encouraged by the view expressed that in due course this law might be revisited to ensure that the scope of orders made by the law might extend to a wider variety of property than cash and property held via bank accounts.

5. Senator I.J. Gorst :

Perhaps I should start by apologising. I was told that, as I was going through the Articles, I was rather quiet. I think it is probably because I have got a cold, so I apologise to Members if they could not hear me. Sometimes one brings a piece of legislation to the Assembly concerned that Members may feel it is too restrictive and goes too far, if I might use that term. So it is a pleasant surprise for me, and perhaps it goes to show how the public mood changes over time, that today Members are wishing it to be more broad or greater in its reach with regard to the items that Senator Bailhache has referred to. Of course, as the Attorney General said, they are and can be covered but also with regard to the issues that Senator Ozouf raised, he, of course, was responsible for financial services in his role and therefore started this work with officials working with the Attorney General and the Attorney General's chambers. I suspect little did he know, when he started that work, that we would be debating this piece of legislation on the very same day that the Jersey Evening Post has the headline that it does within a matter of days that the U.S. Treasury issued its note, on either Thursday or Friday of last week, I cannot recall exactly which day it was. We sometimes like to focus on individuals and we have been having a debate, not only in this Assembly but in the wider public, about a number of individuals who have been given licences to take up residency here or who already have residency here. But the issues that the U.S. Treasury notice raises are not about those individuals per se but about their assets and their wealth and how it was arrived at. I think I have already said during this debate, we do follow E.U. (European Union) sanctions and U.N. (United Nations) sanctions and that is one of Senator Bailhache 's current responsibilities, to implement those sanctions. But what we are seeing internationally, certainly in the U.S. and what we are seeing in the U.K. as well, is making us consider how we would respond and what our response should be to individual states making such notices and freezing orders and sanctions because what is certain is, of course, we do not have the infrastructure and all the requirements of that infrastructure, nor would we wish to, I do not think, on gathering that information or that intelligence, shall we say, which gives an indication of the type of infrastructure that one would require in order to just have our own processes in this regard. That, I suppose, is a

long way of saying to Senator Ozouf he is of course right; once this law gets approved we really will need to take another look at it to see whether, certainly those human rights violations issues need to be put in black and white in the law to make that clear and also the extension to other asset classes. This law will take us to the forefront with the front running pack as we have had a policy position of doing elsewhere. But as we know with these international standards, what is acceptable and how finance and international finance centres like ours should respond to them is ever changing and ever evolving. We must also change and respond as well because this is primarily, of course, about our business and financial services sector, showing that we meet the very highest standards and that we have all the tools available to us that one might expect to find in a country much larger than ours, much more complex than ours and showing that we can still meet those standards despite the nature of our size. It may be that we need to think about extensions in those other regards as well. I am not sure that there were any other items other than to say that the compensation, and I tried to make it clear as I went through the Articles, is awardable if the Viscount and the Attorney General have acted in bad faith. It is important there is understanding that there is a caveat there in that regard for compensation to be issued by the court, and it is issued by the court as a court order, therefore, because it has been issued by the court, the States would have to be under an obligation to pay it otherwise they would be in breach of that court order as well. So, I maintain the Articles in Second Reading and call for the appel.

The Deputy Bailiff :

The appel is called for. I invite Members to return to their seats. I will ask the Greffier to open the voting.