Committee for Enterprise, Trade and Investment

Report on the Terrorist Asset-Freezing etc. Bill Legislative Consent Motion

Preface

• Letter from Chairperson of the Committee for Enterprise, Trade and Investment to all MLAs

Contents

• Background
• Provisions in the Bill
• Committee Consideration

Background

1. The Terrorist Asset-Freezing etc Bill (appendix 1) was introduced at the House of Lords by Commercial Secretary Lord Sassoon on 15 July 2010.
2. In February 2009, the Committee for Enterprise, Trade and Investment released its report on its Inquiry into the Role and Potential of Credit Unions in Northern Ireland (appendix 2) and made recommendations to change credit union functions in NI.
3. One of these recommendations was that credit unions should be permitted to expand their range of services to include, at the very least, those services which credit unions in GB can currently offer. This recommendation is supported by both HM Treasury and DETI.
4. Work is currently being undertaken by DETI and HMT to bring forward legislation to implement that recommendation. DETI and HMT have recently concluded a public consultation on proposals for regulatory reform of credit unions in NI (appendix 3).
5. The transfer of DETI’s responsibilities to the FSA in relation to terrorist financing and money laundering services is one of many steps required to bring the appropriate legislation in Northern Ireland.

Provisions in the Bill

6. The proposed Bill is considered to be the most appropriate legislative mechanism to make amendments to Northern Ireland provisions in the Counter-Terrorism Act 2008 (CTA2008).
7. Credit union policy is a transferred matter and DETI has responsibility for credit union registration and regulation under the Industrial and Provident Societies Act (Northern Ireland) 1969 and the Credit Unions (Northern Ireland) Order 1985. Consequently, there are provisions in CTA 2008 (which extends throughout the UK) that appoints the Department for Enterprise, Trade and Investment (DETI) as both an enforcement and supervisory authority for credit unions in NI regarding terrorist financing and money laundering services.
8. The proposed Bill will transfer DETI’s aforementioned responsibilities prescribed in CTA2008 to the Financial Services Authority (FSA) or its successor.
9. DETI has confirmed that the proposed Bill will not have an impact on the “transferred” status of credit unions in Northern Ireland.

Committee Consideration

10. The Minister for Enterprise, Trade and Investment wrote to the Committee (appendix 4) on 16 September 2010 to notify the Committee that she was going to seek the agreement of the Executive and to obtain consent of the Assembly through a legislative consent motion for the Bill.
11. The Committee commissioned Assembly Research for background information on the Bill at the meeting of 30 September 2010 (appendix 5).
12. The Committee considered the legislative consent memorandum (appendix 6) and received evidence from Departmental officials on the legislative consent motion at its meeting on 07 October 2010. A copy of the Hansard transcript will be available on the Committee website in due course.
13. Having considered the evidence, the Committee agreed to support DETI in seeking the Assembly’s endorsement of the principle of transferring DETI’s responsibilities to the to the FSA in relation to terrorist financing and money laundering services.

Appendices

• Appendix 1 - Terrorist Asset-Freezing etc Bill
• Appendix 2 - Report on the Committee’s Inquiry into the Role and Potential of Credit Unions in Northern Ireland
• Appendix 3 - Proposals for regulatory reform of credit unions in Northern Ireland – DETI and HMT consultation document
• Appendix 4 - Correspondence from Minister for Enterprise, Trade and Investment
• Appendix 5 - Assembly Research paper
• Appendix 6 - Legislative Consent Memorandum