- 1. That any director of the company or any partner of the firm, or the individual, or any manager or other principal officer employed by the company, firm, or individual, is a person who is or has been an enemy, or who was at any time before the fourth day of August nineteen hundred and fourteen the subject of a State which subsequently became an enemy State.
- 2. That in the case of a company, any capital of the company is or was at any time after the twelfth day of November nineteen hundred and seventeen held by or on behalf of an enemy.
- 3. That the company, firm, or individual is or was at any time after the twelfth day of November nineteen hundred and seventeen party to any agreement, arrangement or understanding, which enables or enabled an enemy to influence the policy or conduct of the business.
- 4. That the company, firm, or individual is or was at any time after the twelfth day of November nineteen hundred and seventeen interested, directly or indirectly, to the extent of one-fifth or more of the capital in any undertaking whether or not in the United Kingdom, engaged in business of a kind to which this Act applies, in which enemies are also interested, directly or indirectly, to the extent of one-fifth or more of the capital.
- 5. That the company, firm, or individual, is by any means whatever subject, directly or indirectly, to enemy influence or association.
§ For the purposes of this Schedule—
§ The expression "enemy" means a subject of an enemy State and an enemy controlled corporation.422
§ The expression "enemy State" means any State with which His Majesty is at the passing of this Act, or has after the passing of this Act, become at war.
§ The expression "enemy controlled corporation" means any corporation—
- (a) where the majority of the directors or the persons occupying the position of directors by whatever name called, are subjects of such a State as aforesaid; or
- (b) where the majority of the voting power is in the hands of persons who are subjects of such a State as aforesaid, or who exercise their voting powers directly or indirectly on behalf of persons who are subjects of such a State as aforesaid; or
- (c) where the control is by any means whatever in the hands of:persons who are subjects of such a:State as aforesaid; or
- (d) where the executive is an enemy controlled company or where the majority of the executive are appointed by an enemy controlled company.
§ The expression "capital" in relation to a company means any shares or other securities issued by the company which carry any voting power with respect to the management of the company.
§ Mr. HEMMERDE
I beg to move, in paragraph (1), after the word "any" ["or any manager or other principal officer"], to insert the word "principal."
This Amendment and the following Amendment on the Paper will make the paragraph read:
"That any director of the company or any partner of the firm, or the individual, or any principal manager employed by the company."
It is easy to know who is the principal manager, but the words "principal officer," I suggest, raise very considerable confusion, and the Government might well accept the form of words I propose.
§ Sir G. HEWART
I agree, if I may say so, with the substance of what has been said by my hon. and learned Friend. The object of his pair of Amendments is clearly to confine the operation of the Act to the principal officers. This seems to be a proper thing to be done, but I doubt whether it might not be done in some better form. I would suggest to my hon. 423 and learned Friend that the whole of his object would best be attained if, instead of pursuing the Amendments of which he has given notice, he would propose to omit the words "manager or," making the paragraph read "or any principal officer employed."
§ Mr. HEMMERDE
That would substitute the word "officer" for "manager." I am not sure whether there is not some difference in the terms.
May I ask whether an engineer or a chemist would be a principal officer? The word "manager" is a simple word which we all understand.
§ Sir G. HEWART
I cannot help thinking that this difficulty is more a difficulty about words than anything else. Others might or might not properly be called principal officers, but that could not be said of the manager. "Manager" is included in the words "principal officer."
§ Sir G. HEWART
It does not matter whether he is or not. There are officers who are principal officers without being managers, but there can be no manager who is not a principal officer. The end of the hon. and learned Gentleman would be attained, I think, if the words "manager or other" were left out, so that the sentence would read "or any principal officer employed." The question as to who was a principal officer of a company might depend upon the particular circumstances of the case. Certainly the manager always is a principal officer. My suggestion, I think, would give effect to what I understood to be the real meaning of the proposal of the hon. and learned Gentleman, to limit the operation of the Statute so far as this matter is concerned to the case of the principal officers
§ Mr. HEMMERDE
Will the right hon. and learned Gentleman tell the Committee exactly what is in his mind in dealing with the principal officers? The word "officer" in relation to business does not convey anything clearly to my mind. Supposing one has a business divided into half a dozen different departments, which have each a manager, would these, in the opinion of the Solicitor-General, be within the scope of the term "principal officer"? What I rather aimed at was getting the people who were in the position of 424 managing directors, and who really were in the same sort of position that a partner would be; where they are partners or in a commanding position, and not merely managers of departments under some other head. There is, I believe, considerable doubt about this matter and people would like to know the scope of the enactment.
§ Sir G. HEWART
I am certainly not prepared to accept the insidious invitation to attempt a definition of the term "principal officer." It is quite obvious that a principal officer means something other than the director of a company or the partner in a firm, because a director or a partner is named in the Schedule. Who might or might not be held to be a principal officer is, I think, a question of fact depending upon the circumstances of each case. To go back to the point from which I started, the omission of the word "manager" is something quite acceptable, because whoever else could be excluded from the term "principal officer" the manager certainly could not.
§ Mr. BRUNNER
It is an extraordinary thing that the Solicitor-General really does not know the intention and meaning of the words we are discussing. Really it would be very much better to do away with all this, and to say that no enemy is to be employed at all; then we shall know where we are.
§ 9.0 P.M.
§ Mr. HEMMERDE
Is not the question this: The Solicitor-General will not answer my insidious questions when we ask to know what he means by the term "principal officer"? The company, therefore, is in this position: They may go on trading without a licence under the impression that their principal officer does not come within this condition. For not knowing what the Solicitor-General is not prepared to tell us they will be liable to prosecution and a term of imprisonment. It seems to me to be a novel method of making offences. I should have thought that the term "principal officer" was one that should be most carefully defined in the Bill. That we should be in this happy-go-lucky position of the Solicitor-General not being prepared to accept the insidious invitation, with the result that unfortunate traders may find themselves prosecuted, seems to me to be very undesirable.
§ Mr. HOLT
I beg to move, in paragraph 1, after the word "person" ["is a person who is"], to insert the words "not being a British subject."
This Amendment is intended to exclude from the operations of the first paragraph of this Schedule all persons who, though they were enemies at one time, have since become British subjects. I cannot help thinking that there will be a great consensus of opinion in the country that it is not right to deny to any person who has become naturalised according to our laws the full benefit of British citizenship. There has never been a time when we have recognised in this country, so far as I know, two classes of citizens—one class with less civil rights than another class. Yet that is what the Government propose to enact by this Bill. The Government propose under this Bill that there shall be persons who are entitled to vote and to sit in this House, and yet, nevertheless, are not to be entitled to carry on trade in non-ferrous metals. Such a proposal is as inimical to common sense as it is to any sense of justice. You propose to deprive of the right of dealing in non-ferrous metals persons who may very easily have been in this country since infancy, have been brought over here when of tender age, who have lived in this country all their lives; married women, it may be, of undoubted British origin, who have children fighting in the Army—in one case that I personally know the son has lost his life on the battlefield. You propose to put upon such a man a stigma. under the law so that he may not carry on his legitimate trade in the same manner as other people. It seems to me that this is a very unworthy attack upon naturalised British subjects, and it is very much like treating your letters of naturalisation as a scrap of paper. It is a transaction which as a nation we ought to be ashamed of. The proposal that after you have admitted a man to citizenship, without any actual proof against him whatever or any suggestion that there is anything wrong, you should take from him one of the clearest and simplest rights of citizenship—that of carrying on trade in the country with which he has linked his fortunes—is too monstrously unjust to be defended.
There is another aspect of the case. What about the man who has British citizenship forced upon him? I suppose that even on the Treasury Bench there are still people who hope as a result of this War that some of the German colonies 426 will be brought within the ambit of the British Empire. I hope that South-West Africa, New Guinea, and Samoa will remain part of the British Empire. Are we to understand that if that does occur the inhabitants of those places are to be deprived of, or are not to receive, the full rights of British citizenship? It seems to me that if we contemplate the possible acquisition not only of some of the German colonies, but perhaps the addition of Mesopotamia to the British Empire, we cannot contemplate that the inhabitants of those countries are to be deprived of rights which appertain to British citizenship.
Let me draw the attention of the Government to what has taken place in respect to the most recent annexations made to the Empire, namely, the two Dutch republics in South Africa. Does anybody believe that it would have been wise to exclude the inhabitants of the Dutch republics of South Africa from the right of dealing in metals with the British Empire? Can anybody who looks at what has happened in South Africa believe that it would have been wise to say to General Botha and General Smuts, "You are not to deal in non-ferrous metals"? Do General Smuts' colleagues in the War Cabinet believe that it would have been statesmanship to say to him, "You are not to deal in non-ferrous metals"? The proposition is too absurd. You cannot expect to incorporate territories in your Empire and then expect the inhabitants of those territories to easily fall in with your Imperial system if you are going to place them at a disadvantage as compared with the inhabitants of your original dominions. That is what this Bill proposes to do. I think that whatever may be said in favour of this Bill—and I have not heard anybody say anything in favour of it so far that has had any logical force in it—nothing is a greater blot than the proposal that all persons who are British subjects should not enjoy an equal right to trade.
§ Mr. HEMMERDE
Of the many objectionable features in this Bill I think this is the most detestable. I cannot understand the amazing lack of all sense of humour and proportion displayed by the Government in this particular case, as though it mattered twopence whether we managed to get within our net a few people who happened not to be loyal British subjects, compared with the loss of dignity this country is bound to sustain 427 when they for the first time absolutely break their undertaking that men who have given up citizenship in their own country on the understanding that the word of the British Government was a thing that could be relied upon. Formerly it was, and only recently under the guidance of the Home Secretary we understood that the Government were not prepared to reconsider any question of taking away generally naturalisation certificates but that the matter must be done after full examination on good cause shown. That is how I always understood the attitude of the Home Secretary.
We cannot deal with this question better than by taking a specific instance. I do not in the least apologise for taking instances in regard to a firm which has figured rather largely in the discussion. I do not say that the Board of Trade might not he able to show some good ground for interfering with the rights of British citizens who do not become denationalised in their own country, but until 1913, the year before the War, I think I am right in saying that ten years after one became naturalised in a foreign country one ceased to have any rights at all as a citizen in Germany. They made some alteration afterwards allowing such people to recover their rights, but that was the law. We have heard a great deal of talk about the Mertons' Company in regard to which there has been more ignorant nonsense talked in the newspapers than any other subject during the War, and as there are certain Members who always read certain newspapers, they have read these accounts which are absolutely without foundation. This firm has amongst six directors, two who are naturalised, and they come for that reason within this Clause. Those directors came to this country in the "'eighties," and I could just like to give to the House a picture of one of these men whose presence in this firm is going to entitle the Board of Trade to take away that firm's licence to trade. Mind you, it does not make any difference whether they get rid of him, because the Board of Trade has provided in this Bill that if there is a director after November last, although that firm might say, "We will get rid of these people," they are not under this Act at liberty to do so.
Take the case of one of these people whose enemy association is to be the ground for taking away the privilege of 428 trading of this firm. This man was born at Frankfort in 1869. Three years previously his father, as a member of the Frankfort Militia, had actually shouldered arms to go out and fight the Prussians when they were marching on Frankfort. So incensed was he against the Prussians and all their ways that he had his two sons, one naturalised in Switzerland and the .other leave Frankfort as a mere boy to come to this country. His whole life has been lived in an anti-Prussian atmosphere, and he has been in England for thirty years. He has been in that firm for the entire time. During that time two heads of the firm have died, one recently, and each of them has signalised his disappearance from the world by leaving his entire fortune to British charities. That is the sort of firm that is being brutally attacked by all sorts of innuendoes and suggestions of treachery. That partner was naturalised in 1897, and he was denationalised in 1899. After being denationalised, and ceasing to have any connection with Germany, lie married an English woman, who has two sons fighting in the Army, a third in the Indian Civil Service, and a fourth in an English public school. An English woman, believing that the word of the British Government was to be trusted, and that she and her husband were going to have the rights of British subjects, suddenly finds that she has married a man who, although loyal, is to be treacherously thrown over by these new brooms who are going to sweep clean, and who after a brief political education are going to tell us that the things upon which the welfare of this country depends can be torn up just as if we were so many Germans wanting to invade Belgium. It is a fit thing for the men who organised the raid on Belgium to do, but it is not a fit thing, not merely for English Ministers to do, but for English gentlemen to do.
Let me take the other partner, who lives in daily terror for his only son, whom he loves, and who is now fighting in our Army. I know him, and I know perfectly well that his sympathies are absolutely English as well as those of the people who are attacking him. They know it also perfectly well. That man, at the bidding of our new brooms, is to be treated as absolutely tainted, and unworthy of that British citizenship in virtue of which his son, a British citizen, daily risks his life. This wretched Bill, which Ministers themselves have been unable to defend, as we saw 429 this afternoon—I am not talking of the President of the Board of Trade—without making a melancholy exhibition of ineptitude and ignorance, is drawn absolutely to hit that great firm, and the head of which in the early days of the War was taken by the Government to go out and try to deal with the copper situation, and the members of which have again and again told the people at the War Office, who do not know the first elements of their business, of smelters in large amounts, which these superior persons have always said were unnecessary. These men, who all through have been doing this work, have been the butt of all the malignancy and ignorance of the Press; and the Government, instead of saying, "We know all about these men; they have come into the War Office and have given us their advice; we trust them," have not had one word to say in their defence; on the contrary, they bring in a' Bill drafted absolutely in every particular to hit their firm.
Is it suggested that men who are naturalised and who have been mixed up with the Metallgesellschaft cannot he trusted? The President of the Metallgesellschaft, the President of the Metal Exchange, and a member of the right hon. Gentleman's own Advisory Committee (Mr. Cecil L. Budd) learned their business in the Metallgesellschaft with Mr. Merton. Mr. Budd spent years in the firm of Merton's, and left to set up in opposition to them. He is the man who is to sit in judgment upon men who are considered to be tainted because they have learned their business with the Metallgesellschaft, and are also in business with them! We have heard a good deal about the way in which Merton's were interested with the Metallgesellschaft in Australian zinc concentrates. Mr. Cecil L. Budd was also a partner in that deal. He was then -a member of a firm on the Black List. He is now one of the advisers of the Board of Trade, sitting in judgment on men like these, and advising that a Bill should be drafted to hit this particular firm. That gentleman, having got rid of his German partner since the War began, has now gone into business with another member of the Committee, the firm being known as Messrs. Cookson and Budd. These people, having learned their business with the Metallgesellschaft, first of all partners in trade with Merton's and afterwards their rivals, are the people upon whose advice the Board of Trade are acting in 430 this amazing infringement of the rights of British citizens, I quote that case because the suggestion that a man is more likely to trade with Germany because he happens to have been born in Germany will not bear one moment's examination. Nobody knows better than the right hon. Gentleman that before the War trade did not go by nationalities at all. He, I, or anyone: else in this House at that time, would willingly have done a deal with a German firm just as we would have done with au American firm or any other firm. We know perfectly well that trade is not determined by matters of prejudice.
This Bill is based upon the idea that there is something suspicious in the fact that a man was trading on close and intimate terms with Germany at the beginning of the War. There are men on the Advisory Committee who were in closer touch with Germans at the beginning of the War than some of the men attacked at the present time. These men really are not attacked because they have been in close touch with Germans, but because of their amazing and brilliant efficiency. We might, through this War, have learned not to break our word and copy Germans in that particular, but to educate our people and copy Germans in that particular. Here we are spending day after clay and night after night on this Bill, which has practically had no defender in the House except the members of the Government and the Member for the Wellington Division (Sir C. Henry), and the real fact below the whole of it is that you are attacking these men because they are naturalised British subjects who have brought with them some of the thoroughness of their race and have given us some sort of example how big businesses ought to be carried on. That is the reason they are the butt of everybody who is not particularly successful. Some of these men whom you have called in to advise you are not only the rivals of these men in trade; but they are their unsuccessful rivals. I ask the Government, Is it necessary for the purposes of this Bill to make any sort of infringement of the rights of these citizens? The President of the Board of Trade may say that he cannot take a date and say anyone naturalised after that, because there are certain cases before that case. That is a perfectly reasonable line to take, but is it not more reasonable to deal with all cases of suspicion under some sort of Act, as suggested by the Home Secretary, rather than 431 to take the whole of these naturalised subjects and to say that the mere presence of one of them in any firm in anything like the capacity of a director makes it impossible for the Board of Trade, using their discretion, to give them a licence?
You are throwing your net far too wide. There has been a general idea throughout this Debate—I think the Government is very largely responsible for it—they do not contradict it, and I do not know whether it can be contradicted, but we have from the start been told by certain hon. Members that the idea is that this Bill is to be followed by the creation of a syndicate to control all these metals, and that the people who want to control these metals have said, "We cannot do this unless you eliminate this particular firm," in which these two particular naturalised directors are. If the President will say to me, "I think this is a case where a big national syndicate might be a thing the Government should favour, but as regards the Board of Trade having made up their mind in any way at all whether or not Messrs. Merton should be members of that syndicate, I can assure you that the Board of Trade have not made up their mind at all and are entirely unprejudiced in the matter," I, for one, should feel very differently in regard to the question from what I do now. But there has not been any such suggestion. I say in all seriousness, looking at this Schedule—we shall have to go through the Conditions one by one—that with the exception of Condition 5, I cannot see any other explanation than that they are deliberately drafted under the instructions of men who are aiming at one firm, and one firm only. I do not want to anticipate what will be said on other Amendments, but you will find that Conditions 2 and 4 are inexplicable except on these grounds. Therefore, there is this reasonable suspicion. I would ask the President of the Board of Trade whether it-is not possible, if he cannot now accept. this full Amendment, for him to say that he will, at any rate, accept such a date as would give time for all these people to be denationalised. I have an Amendment down upon the subject of the date, but the date I would suggest, if it is possible, would be ten years before the War, because everybody must, after that date, have become denationalised. As regards one man to whom I have alluded, he has been denationalised from Germany for twenty years.
432 First of all, is it necessary to make this infringement of the rights of citizens at all? In the second place, is it necessary to make it as drastic as it is? I notice one Amendment down on the Paper to make the date the 1st January, 1888. As. a matter of fact, both partners in Merton's came over before that year. That Amendment is in the name of the hon. Baronet the Member for the Wellington Division (Sir C. Henry). It is because things like that are done that this Bill does bear possibly a sinister construction that we are not just in giving to it. If you take that date you will find that. the only person who would escape would be my hon. Friend (Mr. A. Strauss), who never deals in copper but only in tin, and that all the other members of the Metal Exchange and everyone who deals in copper comes after that date. I ask the President of the Board of Trade, is it decent that the Committee should be legislating in that way when people, with the utmost effrontery, are putting on the Paper Amendments, the only object of which seems to be to further, whether justly or unjustly, the interests of their own trade? I say it perfectly frankly—I would say it if the hon. Member were here—that the people who will be hit by this provision are men who are big dealers in copper. They were chosen to go to, America by the Government for that reason. They are also big dealers in tin,. and for that reason he and other people think it is a most excellent thing to have this Bill dealing with copper and tin, although there is no apparent reason,. apart from that, for bringing these people in at all. I would ask the President of the Board of Trade whether it is not possible for him, by concentrating his attention on Condition 5, taking the Committee into his confidence, trying to get control, and to deal with businesses that are really enemy controlled or with enemy association of any sort, to get rid of these other Conditions altogether? I urge him. strongly, if not to accept the whole of the Amendment, which personally I hope he will do, at any rate to let us have some modification that will make it impossible that men whose sons are actually fighting in the British Army should be put on terms like this, and make it perfectly impossible that men who have been in this country, who have been denationalised for twenty years, and who 433 since then have married British women, should be put under any penalties whatsoever.
Sir A. STANLEY
I listened with very great care and attention to the speech that has just. been made by my hon. and learned Friend (Mr. Hemmerde). If I gathered aright, the whole of his speech was directed towards the defence of a particular firm. Why he should take that particular line I am quite at a loss to understand. Certainly neither he nor any other member of the Committee can say that either I myself or anybody else speaking for the Government has at any time during the conduct of this Bill said one word in any way whatever affecting the interests of the firm to which he refers or anybody else affected by this Bill.
Sir A. STANLEY
That may be. I am not responsible for what they have said. They certainly were not inspired by anybody connected with the Government, and they were not authorised to make any such statements.
Sir A. STANLEY
This provision was drafted only after the most careful consideration. It was not, as was suggested by the hon. and learned Member, inspired by any member of the Committee to which he referred, but only because I myself and my advisers connected with the Board of Trade feel that it is imperatively necessary, if this Bill is to be any success, that a provision like this should be inserted in it. I should like to take this opportunity of removing from the mind of the lion. and learned Member who has just spoken and from the mind of every other member of the Committee, the idea that this provision was drafted with the object of definitely excluding from the right to trade in non-ferrous metals in this country either the firm to which he has referred or anybody else. This provision is vitally necessary. I am quite sure that I should have no difficulty in convincing this Committee that there are at least some naturalised enemy aliens who would not, by virtue of their conduct, be entitled to receive a licence to trade in non-ferrous metals if they should make an application. I could give the Committee an instance of a naturalised enemy alien who, since the 434 War, has made attempts, at least we are satisfied that the firm have made attempts,. to trade with the enemy since the Warbegan. I say without any hesitancy that if that individual or the, firm with which lie is connected made an application for a. licence, I should refuse it. It happens that the individual connected. with this firm is not engaged in the metal industry. I am only using it for the purpose of illustration. We had no ground on. which to prosecute. I will give another illustration of a naturalised enemy alien. It was necessary for us to carry on a certain investigation in connection with the affairs of this particular undertaking, and certain books which were needful in order that we might arrive at a right conclusion and might have all the knowledge necessary in coming to a decision were destroyed. I should say there again that the presumption was against the applicant and that lie had found it necessary to destroy certain evidence which was: essential, and therefore his conduct was open to suspicion, and I should again in that instance refuse to give a licence if application was made for it, unless, of course, later on he were able to prove that the documents which were destroyed were really not relevant to the point at issue.
Let me give you a reason why we think it is necessary that this Clause should remain as it is. It is quite clear, I think,. that if the Metallgesellschaft is going to make every possible attempt to reestablish itself in this country after the War it would form an association with some persons of its own nationality, who, however, might be naturalised British. subjects. These persons might not at any time previously have engaged in the nonferrous metal trade. Without this Clause, if they came to us and made application for a licence we could not refuse it. I do not want you to understand for a moment that the mere fact that they are naturalised enemy aliens, Germans or Austrians, or. whatever they may be, is in itself a bar to a licence. Nothing of the sort. There Are, as far as my knowledge goes, naturalised aliens who, by their conduct since they became naturalised, would be just as much entitled to a licence to trade in these, metals as natural-born British subjects; but, on the other hand—we have had experience of them—there are some who would continue to take advantage of their rights as naturalised subjects to conduct themselves in a. manner which the privileges of naturalisation are not 435 supposed to confer upon them. I think we must have a Clause in this Bill which gives us a right to scrutinise with the greatest care the conduct and the actions of naturalised aliens so that as far as we can we may be satisfied that they are not using naturalisation as a cloak in carrying on an enterprise which is prejudicial to the interests of this country. There are naturalised Germans who have resided in this country and have had associations with this industry with credit not only to themselves, but to the country of their adoption. There can be no question of that. The mere accident of birth cannot be taken as a bar and as a ground upon which a licence would be refused. That is not the object of the Clause. The Clause is not directed against any particular firm or individual. It will bring into the net those who, we have a right to assume—not in all cases, but in some—would not act as honourable citizens, who have secured from this country the privilege of naturalisation. It does not go beyond that. It only establishes the right of a very careful review and investigation. We shall take notice of their conduct, and if we are satisfied that they are going to allow themselves in the operation of this business to be controlled by Germans we shall have the right to refuse a licence.
§ Sir C. HOBHOUSE
The Committee, I am sure, will have welcomed my right hon. Friend's repudiation in very dignified and explicit language of the suggestion that this Bill was aimed at any one particular firm. I never myself made that suggestion, and I do not think I ever entertained it, but I am not at all surprised that my hon. Friend behind me, to whom the suggestion is a very real and living one, should have spoken with the warmth and the zeal that lie did in defence of matters of which he has full acquaintance. I hope any remarks I may make upon this subject will be couched in the same moderation of argument which has distinguished the address which has just been made by my right hon. Friend. I entirely sympathise with the object which he has in view, and so far as I am at present informed I should be inclined to take the same action that he proposes to take in the kind of case that he has described to us. Let us see whether the language of this Bill, as it is at present drawn, does in fact do that which he desires and hopes the Bill will do. As I understand the position, the suggestion is that where you 436 have the case of a person who is assisting enemy trade, either during the War or for a period after the War, the Board of Trade should be in a position to step in and curtail and ultimately destroy that enemy influence which is impinging on the industry of British subjects. I think that is a statement of the case which cannot be controverted, and he says for the purpose of doing that he must have the power of saying that in the case of any person who, in the language of the Bill, is of enemy origin or enemy descent, he must have the power, indeed he must be obliged by law to say to that company, "You shall no longer trade in that particular article." I think that is the position as the Bill stands. What about the enemy alien? Not the naturalised British subject resident here, not indeed an enemy subject resident here, but the enemy alien who is resident abroad and conducting his business abroad. We aye not able to control the operations of such a firm by this Bill. An enemy influence abroad by trading through different people and under different names over which the right hon. Gentleman has no check at all, will be able to carry out that series of operations which he dislikes and which we all dislike, and should like to stop, but over whose operations the right hon. Gentleman has no control and no destructive power. Therefore, it seems to me that this Bill as it is at present drawn does not carry out the object for which the Bill was instituted, and it fails in the object for which it is set out. My right hon. Friend said that the Board of Trade in cases where there is suspicion must be able to investigate hooks, and must be able to put a stop to what may be wrongful trading. I would remind my right hon. Friend of a case which had a great deal of notoriety much earlier in the War in which a gentleman who bears an honoured name was accused and thought to be guilty of trading with the enemy. I have no doubt the Board of Trade if they had had the power in that particular case would have acted very quickly and very decisively, and would have stopped the trading of that firm by refusing its licence; but the Board of Trade having no such power, the case had to be carried to the Courts, and when it was brought to Court it was found that there was not sufficient evidence against the firm to convict it of trading with the enemy, with the result that the firm was exonerated. I need not repeat the name because it is well known to hon. Members. 437 One of the parties was convicted but another person who was supposed to be guilty was found not to be. in that case under this Regulation the Board of Trade would have stepped in and would have stopped the firm from trading, although subsequently the other partners in the firm were found to be entirely guiltless of the offence charged against them.
I want to come back to the specific subject-matter of the Amendment. The Amendment asks that in the case of any British subject this Section shall not apply. If I recollect rightly, there has been a great deal of consideration of the subject of what the naturalisation certificates should be in future. In the past it has been tolerably easy to get a certificate of naturalisation. Perhaps there has been undue leniency in the matter. At events, all those persons who are naturalised at present are well known to the police, so that there is no difficulty in tracing their comings and their goings. In future any person to be naturalised is to have all his connections very closely examined before a certificate of naturalisation is granted. It will, therefore, he perfectly easy in future to put a stop to any person gaining access to the markets of this country under the conditions of this Bill if that person is of hostile intent and influence either in commerce or anything else. Therefore, we do not need to deal with the people who are to be naturalised hereafter. We must deal with the people who are naturalised now. I lay great stress upon the fact that the Board of Trade have no option in refusing to give them a licence. If a man is of enemy origin and a director of a company, unless there is some special reason, the Board of Trade must refuse to allow him a licence.
§ Sir C. HOBHOUSE
I am reminded that they may do it without a special reason. I was going to make a suggestion that it should not be for a special reason, but that there should be a discretionary power.
§ Sir C. HOBHOUSE
That removes a great deal of my objection in the matter. Take the case quoted by my hon. and learned Friend (Mr. Hemmerde) of a man who has a son actually fighting for us. There are eases of people who are risking 438 their lives and laying down their lives and losing their health and strength in defence of our safety here, and it is intolerable that cases of the sort quoted by my hon. and learned Friend should arise under this BR There is another case, and that is of a man exiled from his own country, who detests and loathes the tyranny and brutality which exists there, and who flies for refuge to this country and establishes himself in commerce, or his family in commerce, here. Yet that man or his children are disfranchised by the operations of this Bill. I have in mind the case of an eminent person. There is a gentleman in this country—I believe he is a member of the Austrian Reichsrath—named Professor Masaryk. If ever there was a man who deserved well of this country it is that man. I only know him by reputation. Unless we had received this concession, unless it is in the power of the President of the Board of Trade to make his officials exercise that discretion—cases are not always brought by Departments to the Minister—and unless discretion is exercised in a case of that sort, a man fleeing from the tyranny of another country and taking refuge in this country, in what we believe is a free country, is actually handicapped by his transference from tyranny to liberty. That is what is possible under this Bill. I hope that under the administration of my right hon. Friend that that is not likely to occur, but it is possible, and it is to remove that possibility that this Amendment has been moved. I trust that the discretion which I understand the Board of Trade now possess will be freely used. I welcome the repudiation which the right hon. Gentleman has given that this Bill is aimed at any particular individual or any particular firm. That is, perhaps, the most important statement made during the discussion to-day. I hope discretion will be freely used, because the Board of Trade have got the power of the most searching investigation into all the transactions of any firm which applies for a licence and have really got such firm in their grip. Therefore, this discretion ought to be exercised mast freely, and if it is there can be no harm in accepting this Amendment.
The reply of the right hon. Gentleman is all that could possibly be desired. It will have given satisfaction to many hon. Members. It corresponds with the spirit of the speech which the right hon. Gentleman made on the 439 Second Reading, but, as has been pointed out before, it is unfortunately the fact that the right hon. Gentleman will not be President of the Board of Trade for another thirty years, and we must, therefore, contemplate the risk of the Bill being administered by somebody not animated by the spirit which animates him now, and who will act on the exact wording of the measure. Unfortunately, the wording of the Bill is not in harmony with the right hon. Gentleman's speech, although, if he had accepted the Amendment that licences should not be given if it were inexpedient to grant them, it would have corresponded more with the spirit which he held out in his observations. But the wording of the Bill and the speeches of his colleagues are not, I repeat, in harmony with the answers he has given us, and I should like to utter a few words of warning as to what the effect of this Bill may be. Let us take a period two or three years after the War. It may happen that other countries—more particularly the United States —where the commercial class is generally animated by great commercial jealousy, Bills may be proposed assisting one particular set of traders to the detriment of another set. Assume that in a few years' time a Bill may be before the United States Legislature providing that all subjects not of American birth shall be excluded from doing a certain kind of business; or, if you like, assume that a Bill is passed in France or Germany to the same effect. How would we take it In the United States there are millions of Britishers who would be affected. Would they not complain to this country, and ask the Government to protest against the injustice that was being done to them? Then, again, take the case of companies in the United States in which there are many British shareholders. Those British shareholders would have to be excluded, and they would probably have to sell their shares. If the British Government protested, the United States Government would naturally answer, "We are only following your example." What possible rejoinder could we make to that? I invite the Government to contemplate that particular danger because once we start this sort of thing we cannot tell where it will end. I ask the right lion. Gentleman to consider whether the advantages to be derived from this Bill and from this particular Clause are not far outweighed by 440 the disadvantages to which we may be subjected when other countries adopt similar measures against ourselves.
§ 10 P.M.
Undoubtedly this Bill does create a certain disability on the part of British citizens who have been unwise enough to be born to parents belonging to enemy countries. It breaks the agreement into which we entered with them when they became British citizens. We promised that they should be placed on an equality with other British citizens, and now we are withdrawing from that. May I point out one thing which has apparently escaped the attention of the President of the Board of Trade. Under this Clause as it stands, if General Botha or General Smuts desired to enter into this business they would have to go to the Board of Trade and obtain permission to do it. As I read it, the Clause will apply to any person who is or has been an enemy.
§ Mr. HOLT
I am very disappointed indeed at the tone of the speech of the President of the Board of Trade. He does not seem to have the smallest conception of the real issue raised by this Clause. How did he defend it? He defended it solely on the ground that there were a certain number of cases in which the Board of Trade suspected persons— naturalised British subjects of enemy origin—of having been guilty of trading with the enemy. But we know perfectly well there has been more than one case in which British-born subjects have not only been suspected but have been convicted of dealing with the enemy, and the same kind of argument which the right. hon. Gentleman has used must be equally as good an argument for making the provision apply to everybody. Indeed, the whole of his argument. was strong enough to justify the application of this measure to British-born subjects. A foreigner before he can become naturalised has to have his character investigated. In regard to the British-born subject there is no such investigation of character, and therefore primâ facie, one can say that the naturalised subject is more likely to be a respectable man than the natural born subject.
The President of the Board of Trade never attempted to deal with what I venture to believe is the most serious part 441 of this proposal, namely, the suggestion that you are to establish two categories of British citizens. The idea that you should have one class of citizens with complete rights and another class, who have a right to vote for a Member of Parliament and even to sit in this or the other House but not to be allowed to trade in non-ferrous metals without a special certificate from the Board of Trade appears to me to be monstrous. Neither did the right hon. Gentleman deal with the statement that this is a breach of faith. Surely he must see that a proposal to limit the rights of men to whom you have already accorded full citizenship is in effect a breach of faith. It cannot be, I imagine, that he attaches no importance to the matter, and I do suggest that that is an argument worthy of some apology from him. Again the right hon. Gentleman did not deal with that portion of my speech in which I pointed out the effect which this would have upon the natives of German and possibly Turkish territory which we may perhaps annex as a result of this War. As I understand it, it is by no means improbable that a considerable amount of the German colonies and of Turkish territory may be annexed to this Empire. I only hope that that will be the case, and if it does then you will get a position precisely analogous to that occupied by General Smuts and General Botha. Is it the intention of the Government to give notice now to the inhabitants of any part of the enemy's dominions which may, as the result of this War, conic into the British Empire, that they are not to receive the same equal treatment as other British citizens? Is that part of your war aims? If it is so, please tell us. At any rate, when we are dealing with a very important subject like this I think we are entitled to expect from the Treasury Bench a full statement of their policy and the reasons for adopting it.
§ Mr. ROBERTSON
Before the right hon. Gentleman answers that question, may I put one other? In his last speech he spoke of the kind of commercial transaction that by implication after the War we should consider as injurious to the interests of this country, and justifying him in either withholding or cancelling a licence. He has been very sparing of definitions, but will he indicate the kind of commercial transaction which after the War he would regard as so injurious to the national interests as to justify him in withholding or cancelling a licence?
§ Mr. BRUNNER
I can hardly find language strong enough to criticise this proposed transaction which the Board of Trade wishes to carry through. We have granted certificates of naturalisation for a long series of years, even during the War, and also, I am informed, we have naturalised enemy subjects in the Colonies. That naturalisation certificate is a promise to accord to the naturalised citizen the full rights of Englishmen, the full rights of subjects of the British Empire. The President of the Board of Trade proposes to take that promise back. It used to be said that an Englishman's word is as good as his bond. We shall have to alter that, and we shall have to say that an Englishman's bond is worth no more than a Prussian's. We know well that the Prussian Government promised to protect Belgium, and on the plea that the President of the Board of Trades makes to-night—that it is a vital necessity—they invaded Belgium in defiance. of their pledges. The President of the Board of Trade, in violation of the pledges we have given to these men, says it is of vital necessity that we should reduce their status of naturalisation. I cannot conceive of anything more dishonouring to the British Empire than a thing of this sort. The President of the Board of Trade gave us an instance of men who have been naturalised and who have endeavoured to trade with the enemy. He said the Board of Trade had a good case against them for having attempted to trade with the enemy. Then they ought to have been prosecuted and they ought to be in gaol.
§ Mr. BRUNNER
If there was a case against them the Board of Trade ought to have prosecuted them and put them in gaol but they ought to do that with Englishmen who trade with the enemy, just as they would with a naturalised German. There is, therefore, no case on those facts for taking away part of the naturalisation promises which we have given these men on naturalising them. I think we must divide the House against this proposal to take away part of the citizenship Which we have given in times past to men against whom there is nothing whatever in their record as British citizens. If there is anything against their record and it is desired to take further 443 powers to take away the naturalisation privileges it should be done by a general Act of Parliament. It should not be done by a side-wind like this. We should get the reasons for taking away naturalisation papers fully set out in an Act of Parliament which can be discussed, and then we should not be doing anything that is to my mind dishonourable. But having given naturalisation papers, and having men against whom there is not a breath of suspicion and not a word against their characters or records, we ought not to take away their privileges as British citizens because they wish to trade in non-ferrous metals.
§ Mr. D. MASON
I hope the hon. Gentleman who moved this. Amendment will go to a Division. I entirely agree with the hon. Gentleman that this is a question that affects the position of this country in making good its honourable obligations, having granted naturalisation to anyone who comes within the requisite qualifications to receive it. To go against what we have already done in the way of granting naturalisation seems to me to bring our own good name into disrepute, and to cast dishonour on the name of Britain and on this House. As the hon. Gentleman who has just sat down has well said, if a man has been granted naturalisation he is entitled to the rights of naturalisation, and if he is not qualified to receive them he ought not to get the naturalisation. To give a man naturalisation first, to make him a British subject, and then to penalise him is to bring into disrepute the name of Britain, and to cast a slur on our own conduct. It is a thing which every Member of this House, whatever his opinion may be, should resent. If you say you should not grant naturalisation to men of enemy birth that is logical, but having granted naturalisation—
§ The CHAIRMAN
The hon. Member is repeating in different words speeches that have already been delivered more than once; and that is not necessary.
§ Mr. MASON
I am sorry I was not present, though I have attended the Debate up to a late hour, and did riot hear those speeches. I am sorry if I am repeating them, and all I wish to say is that I will strongly support the hon. Member if he goes to a Division, which I hope he will do on account of the facts to which I have referred.
§ Colonel Sir R. WILLIAMS
May I make a remark on the last speech? The hon. Gentleman said he did not hear the arguments he was repeating. They were said not two minutes ago by an hon. Member sitting behind him. May I further make a protest on behalf of some Members of this House who do remember that a War is going on? If hon. Members only remembered that this Non-Ferrous Metals Bill is to portect British from alien influence this Bill ought to have gone through the House in about half-an-hour to an hour. I have been in three or four times in the last two days, and I have found the same hon. Members making the same sort of speeches on the same thing over and over again. There are three or four members of the Government on the Treasury Bench who have pressing international things wafting for them, who have things waiting that are very important for the War, and yet they are kept here, and we have had to suspend the Eleven o'Clock Rule. Then somebody says, "We have. promised very kindly to let them have the Bill to-night." That is what they call patriotism, and there is a war on ! [An. HON. MEMBER: Order!"] I am perfectly in order, and hon. Members ought to know perfectly well that Ministers have these things waiting for them, and that nevertheless we are keeping them here discussing the same things over and over again. It is not patriotism, and it is not common sense.
§ Mr. HEMMERDE
Any honourable arrangement made will be kept so far as we are concerned, but I do think that the remarks which have just been made would not have been made if the hon. and gallant Gentleman had attended these Debates. I regard it as perfectly outrageous that people should come in and make pseudo-patriotic denunciations of this sort about things which they have not studied and have not taken the trouble to understand. Throughout this War many of us have done just as hard and patriotic work as the hon. and gallant Gentleman himself, but simply because we think that the Government could be better employed on other matters than on this Bill, we are not going to be lectured by him; and I can tell many others who want to indulge in tactics of this sort with us that if they want to get Bills through on the basis of a Coalition Government at all events they will be civil to us, who are doing our best in the interest of our constituents. 445 We have got one of the Law Officers here now, and I would like to ask him a question. Some very strong statements have been made here, and I say on my word of honour that I can see no distinction between what we are doing and what Bethmann-Hollweg did. By what possible justification are the Government now, by a mere administrative Act, going
§ Mr. A. STRAUSS
I beg to move, in paragraph 1, to leave out the words "before the fourth day of August, nineteen hundred and fourteen."
I move this Amendment in the absence of the hon. Gentleman (Sir Charles Henry), and I do so without offering any arguments, but simply to give the Government an opportunity of saying whether they accept it or not.
446 to override certificates of naturalisation without any sort of charge being made against these people and heard in public?
Question put, "That those words be there inserted."
§ The Committee divided: Ayes, 36; Noes, 106.445
|Division No. 143.]||AYES.||[10.18 p.m.|
|Baker, Joseph Allen (Finsbury, E.)||Jowett. Frederick William||Runciman, Rt. Hon. Walter (Dewsbury)|
|Bliss, Joseph||King, Joseph||Runciman, Rt. Hon. Walter (Dewsbury)|
|Bowerman, Rt. Hon. C. W.||Lambert, Richard (Wilts, Cricklade)||Smith, Sir Swire (Keighley, Yorks)|
|Chancellor, Henry George||MacVeagh, Jeremiah||Strauss, Arthur (Paddington, North)|
|Davies, Timothy (Lincs., Louth)||Mason, David M. (Coventry)||Taylor, John W. (Durham)|
|Gulland, Rt. Hon. John William||Nuttail, Harry||Taylor, Theodore C. (Radcliffe)|
|Harris, Percy A. (Leicester, S.)||Pringle, William M. R.||Toulmin, Sir George|
|Hemmerde, Edward George||Raffan, Peter Wilson||Whitehouse, John Howard|
|Henderson, John M. (Aberdeen, W.)||Rea, Walter Russell (Scarborngh)||Williams, Aneurin (Durham)|
|Hinds, John||Richardson, Arthur (Rotherham)||Williams, Penry (Middlesbrough)|
|Hobhouse, Rt. Hon. Sir Charles E. H.||Richardson, Thomas (Whitehaven)|
|Howard, Hon. Geoffrey||Robertson, Rt. Hon. John M.||TELLERS FOR THE AYES.—Mr|
|Jones, Rt. Hon. Leif (Notts, Rushcliffe)||Roch, Walter F.||Holt and Mr. Brunner.|
|Addison, Rt. Hon. Dr. Christopher||Gibbs, Col. George Abraham||Pollock, Sir Ernest Murray|
|Agg-Gardner, Sir James Tynte||Greig, Col. James William||Pretyman, Rt. Hon. Ernest George|
|Archdale. Lieut. Edward M.||Gretton, John||Pryce-Jones, Col. E.|
|Baird, John Lawrence||Guest, Hon. Frederick E. (Dorset, E.)||Rees, G. C. (Carnarvon, Arfon)|
|Baldwin, Stanley||Hall, Lt.-Cal. Sir Fred (Dulw ch)||Rendall, Athelstan|
|Barlow, Sir Montague (Salford, South)||Harcourt, Robert V. (Montrose)||Robinson, Sidney|
|Barnett, Capt. R. W.||Hardy, Rt. Hon. Laurence||Scott, A. MacCallum (Glas., Bridgeton).|
|Benn, Arthur Shirley (Plymouth)||Harmood-Banner, Sir J. S.||Shaw, Hon. A.|
|Bentham, G. J.||Harris, Sir Henry (Paddington, S.)||Spear, Sir John Ward|
|Bigiand, Alfred||Henry, Denis S. (Londonderer, S.)||Stanier, Captain Sir Beville|
|Black, Sir Arthur W.||Hewart, Rt. Hon. Sir Gordon||Stanley,Rt.Hon.Sir A.H.(Asht'n-u-Lyne)|
|Boscawen, Sir Arthur S. T. Griffith-||Hewins, William Albert Samiel||Stewart, Gershom|
|Boyton, Sir James||Hibbert, Sir Henry F.||Strauss, Edward A. (Southwark, West)|
|Brace, Rt. Hon. William||Hodge, Rt. Hon. John||Swift, Rigby|
|Brassey, H. L. C.||Hughes, Spencer Leigh||Talbot, Rt. Hon. Lord Edmund|
|Bridgeman, William Clive||Hunter-Weston, Lieut.-Gen. Sir A. G.||Terrell, G. (Wilts, N W.)|
|Burn. Colonel C. R.||Jardine, Ernest (Somerset, East)||Thomas-Stanford, Charles|
|Carew, C. R. S.||Janes, Edgar (Merthyr Tydvil)||Tickler, T. G.|
|Cater, John||Jenes, J. Towyn (Carmarthen, East)||Tootill, Robert|
|Cautley, H. S.||Jones, William S. Glyn- (Stepney)||Tryon, Capt. George Clement|
|Cave, Rt. Hon. Sir George||Kerr-Smiley, Major Peter Kerr||Walker, Col. William Hall|
|Cecil, Rt. Hon. Evelyn (Aston Manor)||Law, Rt. Hon. A. Bonar (Bottle)||Walsh, Stephen (Lancs., Ince)|
|Coates, Major Sir Edward Feetham||Lewis, Rt. Hon. John Herbert||Ward, W. Dudley (Southampton)|
|Cochrane, Cecil Algernon||Lindsay, William Arthur||Wardle, George J.|
|Colvin, Col. Richard Beale||Lecker-Lampson, G. (Salisbu'y)||Whiteley, Sir H. J.|
|Coote, William||M'Calmont, Brig.-Gen. Reber: C. A.||Williams, Col. Sir Robert (Dorset, W.).|
|Cornwall. Sir Edwin A.||Mackinder, H. J.||Willoughby, Lieut.-Col. Hon. Claud|
|Craik, Rt. Hon. Sir Henry||McNeill, Ronald (Kent, St. Augustine's)||Wills, Major Sir Gilbert|
|Currie, George W.||Mason, James F. (Windsor)||Wilson-Fox, Henry|
|Dalrymple, Hon. H. H.||Munro, Rt. Hon. Robert||Winfrey, Sir Richard|
|Davies, David (Montgomery Co.)||Needham, Christopher T.||Wing, Thomas Edward|
|Duke, Rt. Hon. Henry Edward||O'Neill, Capt. Hon. H. (Antrim, Mid)||Worthington Evans, Major Sir L.|
|Duncan, C. (Barrow-in-Furness)||Parker, James (Halifax)||Young, William (Perthshire, East)|
|Fisher, Rt. Hon. W. Hayes (Fulham)||Pease, Rt.hon.Herbt. Pike (Darlington)|
|Flannery, Sir J. Fartescue||Pennefather, De Fonblanque||TELLERS FOR THE NOES.—Mr.|
|Fletcher, John Samuel||Peto. Basil Edward||J. Hope and Mr. Pratt.|
Sir A. STANLEY
We cannot accept the Amendment, and I think it would be wasting the time of the Committee if I were to repeat the arguments which have been already advanced.
§ Mr. G. TERRELL
I beg to move, after paragraph 1, to insert the following new paragraph:
"2. That the company, firm, or individual; has at any time since the 447 twelfth day of November, nineteen hundred and seventeen, sold to or purchased for the use or benefit of an enemy or is or was on or after the twelfth day of November, nineteen hundred and seventeen, under contract so to sell or purchase any unmanufactured metals or ores to which this Act applies."
The object of this Amendment is to fill up a gap in the first paragraph of the Schedule, and deals with the cases of firms which, though otherwise desirable firms, yet have dealings with enemies. I certainly think that that is a case which ought to be met. I do not think it is necessary for me to speak at any length upon the matter, as the object of the Amendment is clear upon the face of it. I trust my right hon. Friend will see his way to accept it. It is one of the Amendments which have been carefully considered by the manufacturers' organisations, and they have asked me to move it.
§ Mr. WARDLE
We could not possibly accept this Amendment. Persons who now trade with the enemy would be responsible under the Trading With the Enemy Act, and could be dealt with under that Act, so that this is not necessary.
Amendment, by leave, withdrawn.
§ Mr. HOLT
I beg to move, in paragraph 2, after the word "any" ["any capital"], to insert the words "one-half or more of."
Unless one-half or more of the capital is held by an enemy the company cannot be said to be an enemy controlled firm, and the fact that one or two shares were so held would not make it an enemy-controlled firm.
Sir A. STANLEY
We cannot accept this Amendment. I have endeavoured to make it quite clear that it does not at all follow that any company, firm, or individual who comes within the terms of the Schedule could not receive a licence. It is only that this Schedule must be made as wide as possible, so that we shall have an opportunity of reviewing these cases, and the Board of Trade may be able to exercise their discretion in determining whether a licence shall be given. I am sorry we cannot accept the Amendment.
§ Mr. L. JONES
I hope the President will realise that this is a case in which 448 he will have to exercise very careful discretion, because particularly in these metal concerns there are trading firms in this country which are essentially British firms, but in which there have been enemy holdings, sometimes, it is true, very small, but still enemy holdings, and there is no way of getting rid of them at present. The firms are helpless in the matter, and therefore I think it is a case in which discretion will have to be very carefully exercised.
§ Mr. HEMMERDE
Could not the President be satisfied with a somewhat different figure? Why does the Board of Trade want to examine into the matter if there is a quite small fraction? There are cases, I believe, in which about one share is held in a large undertaking, but according to what the President said, even that case has got to be examined. I cannot see what is the good of multiplying the labours in the Board of Trade, and if the right. hon. Gentleman could accept the Amendment later on the Paper of one-fifth, it would save a lot of trouble to the Board of Trade and do no harm to anybody.
Sir A. STANLEY
May I point out that the control of an undertaking does not necessarily follow from the amount of capital held? It may frequently happen that one share can carry the control of the whole undertaking. It sometimes happens that the whole of the voting is vested in a single share, and very often a small proportion of the capital carries the whole of the profits of the company. Therefore I think it is necessary to have these wide powers, and the Committee may be satisfied that we shall exercise our discretion properly.
Where there is an enemy shareholder in any company at the present time there have been investigations right and left, and the Public Trustee and Board of Trade have sold those shares, and the Public Trustee has got the money. Presumably all these are cleared out, and it would be very hard that any company, which happened to have a few shares they did not know were under the name of somebody who was a nominee of somebody else, should be brought into this.
§ Mr. HOLT
I must confess that, for the first time, I think, the Treasury 449 Bench have produced an argument against accepting an Amendment. I admit that the case of the founder's share is a sufficient argument against the Amendment in the form in which it is drafted, but is not a sufficient argument against its principle. On the Report stage I will bring forward an Amendment, because it does seem unreasonable that a company in which there was an absolutely trivial voting power of this sort should be subject to this. In almost any company which has been established for a considerable period it may be that a small share has passed to a foreigner by inheritance, and it is unreasonable that for that reason that company should be put under a special disability. Therefore I do hope, if I withdraw the Amendment now, the President will keep his mind open until the Report stage and see if he cannot then accept an Amendment which will have the effect of limiting this to companies, at any rate, where a substantial amount of voting power remains in the hands of enemies.
§ Mr. HEMMERDE
May I express my disagreement with what the right hon. Gentleman has said from the Treasury Bench? If he notices condition 5 he will see to what I refer.
§ Mr. D. MASON
May I suggest, in view of the hon. Member opposite being willing to withdraw his Amendment, that the right hon. Gentleman the President, if he cannot accept this Amendment, might accept one somewhat similar in terms?
Amendment, by leave, withdrawn.
§ Mr. HEMMERDE
I beg to move, in paragraph 2, to leave out the words "the twelfth day of November, nineteen hundred and seventeen," and to insert instead thereof the words "six months from the passing of this Act."
I do not want to Waste time over this matter, but I should like to know from the President of the Board of Trade why the date 12th November is taken? Would it not be better to put in the words I suggest? What is the point of dating the thing back? Supposing the people chose in the meantime to get rid of this capital? They possessed capital in November, and got rid of it, and you are still going to put them under the difficulty in regard to a licence.
§ Mr. WARDLE
The real reason why this date is taken is—[HON. MEMBERS: "Speak 450 up!"]—that under the circumstances it was felt expedient that it should be so taken.
§ Mr. HEMMERDE
My point is that it is rather unusual to take a date in this way, and it is likely to have an absurd effect. If a company puts its house in order by a certain date it is still to have the trouble that I have suggested.
Sir A. STANLEY
A company, firm, or individual who were under enemy control when this Bill was introduced is given the opportunity of purging themselves of that enemy control, and so of excluding themselves from the Schedule. It does not follow that by that one act alone it has completely purged itself. It may be that their conduct prior to the time that this Bill was introduced was such that nobody would be really justified in assuming that they would carry on their business hereafter is the interests of this country and not in the interests of the foreign control they were subject to at the time the Bill was introduced. This is not any real disability, but an instance where the Board of Trade must exercise its discretion. The Board of Trade will not attempt. to interfere with any undertaking winch is trying to purge itself of any enemy control. On the contrary, we shall be glad to assist them in doing it, but that need not take them outside the Schedule. There may be instances where it would be really wrong to allow a company, firm, or individual to remove themselves from the provisions of this Schedule.
§ Sir C. HOBHOUSE
I hope the President w ill reconsider this matter between now and the Report stage. He has spoken of a test, and that is the possession of a certain amount of capital under enemy influence or control. When that test, which is the only one he requires, is removed, when the offence no longer exists, when the test he has provided is no longer applicable, then there is no reason for them to fear examination by the Board of Trade. I think if the right hon. Gentleman looks back upon his earlier career, when he sat upon the other side of the counter, and had to send to the Board of Trade and admit them to his offices for the purpose of conducting his business, I do not think he formed that opinion of their flexibility and easiness. For these reasons I ask the right hon. Gentleman to reconsider this point between now and the Report stage.
§ Mr. HOLT
I think the President would be well advised if he consented to wipe out this date altogether. If they are really such bad people, all they need to do is to wind up the company and start an absolutely new one, in which none but bonâ-fide British shareholders shall be members.
Amendment made: At the end of paragraph 2, insert the words "including any stock or shares of the company vested in the custodian by virtue of any Order made under the Trading With the Enemy Acts, 1914 to 1916."—[Sir A. Stanley.]
§ Mr. STRAUSS
I beg to move, in paragraph 3, to leave out the word "influence," and to insert instead thereof the word "control."
It seems to me that the word "influence" is far too vague and wide. After all, what does "influence" mean? Supposing a man gets an order from someone in Germany or Austria to buy copper and that on that tip or information he buys some for himself, he would be clearly influenced by the order that he got. Again, he might have a correspondent in Germany or Austria advise him to buy or to sell tin, or give him information that it would be a good operation. That would come under the word "influence." I do not think that is necessarily what is meant; I suppose what is meant is that there should be no control exercised.
Sir A. STANLEY
The word "influence" is really the better word under the circumstances. It has a wider meaning, and we prefer it. I trust, therefore, that the hon. Gentleman will not press his Amendment.
§ Mr. HOLT
I beg to move to leave out paragraph 4.
This is really one of the most extraordinary paragraphs in the Schedule. It means, if a British firm has a fifth or more shares in a foreign company or if it subsequently or at any time transpires that a foreign company has a fifth of its shares, that it is to be debarred from carrying on trade in this country without a licence. Take the common case of bearer shares. How are you to know who holds bearer shares? A man knows what proportion of bearer shares he holds himself, but how can he possibly know the bearer shares of anybody else? An enemy may 452 one day buy up a fifth of the bearer shares of a company. Are we to understand directly that happens, if it can be found out, that the British firm is to be deprived of the full right to deal in non-ferrous metals? Is it part of the policy of the British Government to say that after the War a British subject is not to he interested with a German in business in America or in a neutral country? That apparently is what this Clause means, if it means anything. I should hope, after the War is over and after peace, which, with the right hon. Gentleman the Member for East Fife (Mr. Asquith), I trust will be a clean peace, is concluded, that British citizens will co-operate with German citizens in neutral countries. After all, it is only a question of time. It has got to come sooner or later, and it is very regrettable that the Government should put in a Bill something which indicates that there is something improper and wrong in co-operation in commercial enterprises between British and German citizens.
Sir A. STANLEY
We cannot accept this Amendment, and I can make it clear to the hon. Member why we cannot do so. Let me say, first of all, that it is not the policy of the Government and it is not our intention to try to prevent, after the War, British subjects from associating with foreigners in any new enterprise in a foreign country. It is not intended by this condition that any prohibition will be put upon an association with a foreign undertaking of British and German subjects. What the condition is intended to do is to bring under review any company, firm, -or individual which has formed an association with an undertaking in a foreign country which has associated with it German connections. If an English company had an interest to the extent of one-fifth in, shall we say, a company in America and Germans also had an interest to the extent of one-fifth in that company, the presumption would be that there is a common interest. Between them they practically control that company, because two-fifths is a very substantial part of any undertaking. That in itself is not harmful, but it would be harmful if, through that association, metals in which the foreign undertaking was operating were transferred unfairly to Germany rather than to this country. It is that sort of association we desire to prevent, if we can. Therefore we are assuming that this double connection will in itself be right. 453 I say at once that there is no desire on our part to interfere with or impede it in any way. All that we ask is that through that connection there should not be exercised any German control which in itself would be to the advantage of Germany and to the disadvantage of this country. I think that is a fair statement to make. In the circumstances, as I have said, where so large a control of a foreign company is held by Germans and by British subjects, we should have the right of investigation. So long as that control is not exercised unfairly to the disadvantage of this country and to the advantage of Germany, it will not be interfered with; but if the control is exercised to the disadvantage of this country and to the advantage of Germany, all we can do is to prevent the English company associated with that foreign undertaking from trading in this country. We can at least attach that penalty. We cannot prevent them having control of the company, but we can put that penalty upon them, and I think we should have that right.
§ Mr. L. JONES
I do not think the right hon. Gentleman sees in what a curious position the Government is being landed by this provision. I had thought it was part of the policy of the Government definitely to encourage traders in this country to try to capture trade from the Germans, to go where the Germans have gone, and to rival and beat them, if they can, at their own business. That has been definitely the policy which the Government has set out as a desirable thing for British traders, and I thought British traders had rivalled Germans all over the world and beaten them, and in most parts of the world, and I think they will continue to do so if the Government will not put obstacles in their way. Has the right hon. Gentleman never heard of endeavouring to get shares in a company in order to acquire influence in it and control it? Yet if a British firm has the enterprise to seek an opportunity of getting into a company whore Germans have had a fifth influence, and the Britisher has had an opportunity of getting a fifth influence, he is viewed with suspicion instead of admiration by the Board of Trade. The whole attitude of the Bill—certainly the attitude of the right hon. Gentleman—was to regard with suspicion any British firm which was going to meddle in a sphere which at present is controlled by Germans. Take the case of Bolivia, where tin is bought by Germans and by British. If the 454 British go into a firm in which Germans are already engaged, and if they have the wit, the foresight, the insight, and the willingness to try to get this trade from the Germans, from that moment they are discouraged by the Board of Trade. My right hon. Friend says, "We would not discourage them in such a case. We would commend that enterprise. They have only to confide in us and we shall help them in every possible way." I say again, British traders like to go their own way to work without being meddled with unnecessarily by the Government, and by spreading his net so wide in this Schedule the right hon. Gentleman is discouraging enterprise which the Government professes to wish to encourage.
Let me put this case to my right hon. Friend. In America there are associations controlling a number of mines, and there are so many British, so many Germans, and so many American. I know a case where a third of the capital is held 'ay Germans, a third by Americans, and a third by British. What is going to happen? A taint is to be put upon the British holder. The Britisher must sell his holding. And who buys it? The German. and the American. Why does he acquire the third? To get control of ore for his smelting. You talk about patriotism. I am more patriotic than you. I want to let him have his ore, whereas you are going to put him under the control of the Germans and Americans. That is what this does. It is all very well to say, "We do not mean to do that. We want the power. Give us the power to do everything and anything and trust to our good nature and discretion." That is not good enough. You have no right to put a clog upon British enterprise.
There is this other difficulty. You Will have very great difficulty in finding out who are the owners of shares in this country. You have tried to meet that by an Amendment giving the company power to call in its shares and have them registered. I do not think it is going to be very operative, but never mind. You have no such power in America, and a British firm may be perfectly innocently the holder of two-fifths of the shares which it has bought for the purpose of giving itself a regular supply of ore, perhaps of a special quality, with more or less sulphur in it, or something of that kind. The Board of Trade regards that firm with suspicion. 455 That is not encouraging to British trade. The Board of Trade ought to help British traders to trade in competition with the Germans or the Americans and others, but it is doing the very opposite. I hope that between now and the Report stage the right hon. Gentleman will see the folly of this. He has plenty of other powers in the Bill. This one is absurd and calculated to do more harm than good.
§ 11.0 P.M.
Sir F. HALL
I beg to move to leave out the words, "to the extent of one-fifth or more of the capital."
I want to clear out all those people who have been holding these enemy shares. We have admitted, by the introduction of this Bill, that we are not satisfied, and we are not prepared for a period of five years, at all events, to recognise Germany or any enemy countries, and yet you turn round and allow shares up to one-fifth of the capital. There has been a great deal of repetition in the discussion on this Bill—the same story told in a different way. On the Second Reading we were told by the right hon. Member for Tyneside (Mr. Robertson) that this was a punitive measure, and we were told yesterday by the hon. Member for Coventry (Mr. D. Mason) that it was a futile measure. Let us do away with this futility and these punitive measures and say perfectly plainly that it is not a question of one-fifth of the shares being held by enemies, but that we are not going to allow anything of the sort. We say that it is to be British capital and British industry. So far as I am concerned, I am a British trader, interested in British commerce, and I want to see that at all events for five years we shall be free from this enemy business, and that what you give with one hand in the Bill you shall not take away with the other.
§ Mr. WARDLE
The effect of the Amendment would be to prevent the trading of any firm in the non-ferrous metals industry in which enemy interests were concerned, however slight.
§ Mr. WARDLE
Experience has shown that so long as that influence is not an 456 effective influence there is really no necessity for the Amendment. We have an Amendment on the Paper which, I think, will really meet the hon. Member's point, and that is an Amendment affecting profits or voting power. Our next Amendment on the Paper will cover the point, and will remove all suspicion as to whether the holding will be of such a nature as to carry real control.
§ Mr. HEMMERDE
An enemy under the Amendment has only to get one share in a large company to prevent a licence being granted to it. If that is the contribution of a British trader after two days' Debate my withers are unwrung by the charge of having been guilty of a certain amount. of repetition.
Sir F. HALL
As far as I am concerned I stick to my guns. I had hoped, on the introduction of this Bill, that it was going to be made fairly plain, but I am disappointed as to what fell from the last speaker; we certainly look at this question from different aspects, but I will say this, that an Amendment brought forward by the right hon. Gentleman the President of the Board of Trade dealing with hearer shares has simplified matters. Surely it would be perfectly simple for this. House to say, after what we have passed through during three and a-half years of war, we will not join hands with German finance in the introduction of German business, but will fight them off our own bat. I still hope my Amendment may be accepted.
Amendment made: In paragraph 4, after the word "capital," insert the words "profits or voting power."—[Sir A. Stanley.]
§ Mr. G. TERRELL
I beg to move, in paragraph 4, to leave out the words "in which enemies are also interested, directly or indirectly, to the extent of one-fifth or more of the capital," and to insert instead thereof the words "which is an enemy controlled corporation."
We have a definition in the Schedule of what is an enemy controlled corporation. and I venture to think that would be a more workable arrangement than the words of the Bill.
§ Mr. WARDLE
I am very sorry I cannot accept this Amendment. It is a limiting 457 one. May I acid that in the case of a company in the United States it would not be considered to be enemy controlled.
Further Amendment made: At the end of paragraph 4, insert the words "profits or voting power."—[Sir A. Stanley.]
§ Mr. HOLT
I beg to move, in paragraph 5, to leave out the words "That the company, firm, or individual is by any means whatever subject directly or indirectly to enemy influence or association."
I should like a little Inure information on this point. I want to know what is the position of an individual subject to enemy influence? Suppose he has a German mother-in-law, would he be subject to enemy influence or association? Take the case of a company. I happen to know one of the most eminent companies in the town in which I live, of which the principal individual not only has a foreign mother but has a foreign wife. They do not happen to be enemies, but they might have been. Is that a person to be described as subject to enemy influence or association, assuming they had been Germans? In this connection I want to draw attention to what the definition of an enemy State is—
"An enemy State means any State with which His Majesty is at the passing of this Act, or has after the passing of this Act, become at war."
So, if within five years after this War is over we are at war with some other country—France or America—all those people who have French or American relatives will discover they are under enemy influence or association. The truth is that this Clause is so absurd and vague that it had better be left out. I defy anyone to say that it has any proper legal meaning. No one can say what enemy influence or association mean. It is a pure matter of opinion as to which I should think even the Courts would find great difficulty in coming to a decision.
§ Mr. WARDLE
The hon. Gentleman seems to think there is great difficulty about it, but as a matter of fact these are the words under which the Trading With the Enemy Act has been administered for the last three years, and I do 458 not see there should be the slightest difficulty in interpreting them in the proper way in regard to this particular Clause.
§ Mr. STRAUSS
We have the learned Solicitor-General here, and I am sure some of us would be very pleased if he would explain to us what the word "association" means. Moreover, it seems to me that if we include paragraph 5 there would he no occasion to have paragraphs 3 and 4 at all, because paragraph 5 is so wide as to include all that is in paragraphs 3 and 4.
§ Mr. L. JONES
I think we ought to have some instances given of what the Government really do mean by these words. It is all very well for those who are familiar with the Act referred to by the hon. Gentleman (Mr. Wardle), but some of us are not so accustomed to that Act and to what is meant by enemy influence and association.
§ Sir G. HEWART
I rise reluctantly, because I think it is really unnecessary that I should reply at all. I should be content for my own part to say that I cordially agree with what has been said by the Parliamentary Secretary to the Board of Trade. But I would suggest further that it might be possible for an individual to get round the provisions of paragraph 4 and influence a particular company or individual. I am not going to conjecture instances or possibilities of what might be done, but if I am asked what is meant by "association" I find it difficult to substitute better words. What it means is a protection against businesses being directly or indirectly subject to enemy influence or association. The persons who administer the Act and the Courts which in the last resort would have to interpret it must be expected to act reasonably, and this phrase supplies the general words for those occasions on which by ingenuity the other more express conditions may be successfully evaded. What particular form that may take I shall not attempt to forecast, but I do submit that it is necessary to have general words of the kind, which arc not unknown to the law, as it stands now.
§ Mr. HEMMERDE
I beg to move, "in paragraph 5, after the word" to insert the words "in the conduct of their or his business."
§ Mr. D. MASON
I beg to move, in paragraph 5, to leave out the words "influence or association," and to insert instead thereof the word "control."
There would be interminable discussion caused as to what really constitutes influence or association. If you were to cut out those words it would be perfectly clear, it would avoid friction, and tend to make the Bill popular.
§ Sir G. HEWART
This Amendment cannot be accepted. It is precisely because there may be influence or association of a. mischievous character falling short of control that these words are desirable.
Sir A. STANLEY
I beg to move, after paragraph 5, to insert the following new paragraph:
"6. That, in the case of a company, the company has issued share warrants to bearer and has not given notice under this Act requiring the holders of the share warrants to surrender their warrants for cancellation."
§ Mr. BRUNNER
This is the string at the tail of the new Clause which the President of the Board of Trade moved earlier in the evening. The original Clause read that you may give notice requiring the share warrants to be surrendered. Now we have come to a new position as fixed in the Schedule, that if you do not call for share warrants you may have the licence withheld. Why not, instead of doing that, put in the Clause simply saying that the company shall give notice of surrender of share warrants? It would be a much less clumsy way of carrying out the operation.
Amendment agreed to.
§ Mr. BRUNNER
I beg to move, after the word "corporation" ["and an enemy controlled corporation"], to insert the words, "Provided that the expression, 'enemy,' shall not mean a person who, or a person whose son, has served in the present War in the Navy, Army, Reserve Forces, or Air Service."
I think this Amendment really ought to be carried. Surely when a man has fought the enemy, or when his son has fought against the enemy of this country, 460 we should not bring him under this Bill as a tainted person. He has proved in a way which a man can best do that he is loyal to this country. It is not only sons who do this. I know some cases where persons of German origin have fought against the country of their origin on account of their loyalty to this country. I think I may press upon the President the acceptance of this Amendment.
§ Mr. WARDLE
I am afraid we cannot accept the Amendment, because compulsory service might alter the circumstances with regard to some persons who would come within the scope of this measure. But there will be no disposition on the part of the Board of Trade to act arbitrarily, and they will take into consideration the fact of a person having acted loyally and patriotically. In the case of those persons they would certainly give all the circumstances the fullest consideration. This Bill simply provides for a review of the circumstances, and the fact of a review does not mean that a man would not receive the utmost consideration.
§ Mr. HOLT
I beg to move to. leave out the words, "any State with which His Majesty is at the passing of this Act, or has after the passing of this Act, become at war," and to insert instead thereof the words, "Germany, Austria-Hungary, Bulgaria, and Turkey."
If the Government look at the paragraph, I think they will see that it might cause some trouble. It says, "the expression 'enemy State' means any State with which His Majesty is at the passing of this Act, or has after the passing of this Act, become at war."
§ Sir G. HEWART
It will perhaps save the hon. Member the trouble of making further remarks if I say that we are willing to accept this Amendment.
Amendment agreed to.
Mr. BRUNNER:I beg to move to leave out the word "other" ["other securities"]. I am sure the Solicitor-General knows that shares are in the securities, and therefore the word ought not to be in the Bill.
§ Sir G. HEWART
We accept the Amendment, but I must not be taken to agree with the lion. Gentleman's observation.
§ Mr. BRUNNER
It is correct all the same.
Amendment agreed to.
Further Amendment made: After the word "carry" ["which carry any"], insert the words "or would if the necessary formalities were complied with carry."—[Sir A. Stanley.]
§ Mr. G. TERRELL
I beg to move, at the end, to add the words "and shall also include debentures and debenture stock and money lent to the company."
This is intended to fill up what is a loophole in the Bill, because it is obvious that share capital is not the only form of capital which an enemy might have in a company. It would be equally controlled if they held debentures or had a loan.
Amendment agreed to.
Schedule, as amended, ordered to stand part of the Bill.