Section 14: Powers to arrange for evidence to be obtained

55.     This section sets out the conditions which need to be satisfied before a court may be nominated to receive evidence under section 15. Subsection (1) sets out the types of court proceedings, or investigations, in connection with which evidence may be obtained for an overseas authority. In line with the requirements of Article 3 of the MLAC and Article 49(c) of the Schengen Convention, subsection (1)(b) provides that assistance may be provided in connection with administrative proceedings or an investigation into an act which is punishable in such proceedings. In some EU Member States offences such as driving infractions are classified neither as criminal nor civil proceedings, but as administrative proceedings. In the UK, there is no precise parallel to these proceedings, but legislation is needed to allow assistance to be provided to other participating countries in relation to this type of proceedings. Subsection (1)(c) provides that assistance may be provided in connection with clemency proceedings or an appeal during the judicial phase of administrative proceedings. Both clemency proceedings and administrative proceedings are defined in section 51(1). The Schengen Convention also requires assistance to be given in relation to civil proceedings joined to criminal proceedings, where a final decision has not yet been reached in the criminal proceedings. The definition of "criminal proceedings" in section 51(1) therefore allows for assistance to be provided in these cases.

56.     Subsection (2) of section 14 limits the provision of assistance within subsections (1)(a) or (b) to when an offence has been committed or there are reasonable grounds for suspecting this, and when proceedings have been instituted or an investigation is being carried out. An offence for these purposes includes an act punishable in administrative proceedings. Subsection (3) provides that a certificate from the overseas authority confirming these matters is to be regarded as conclusive. In the vast majority of cases this certificate is not required. The letter of request will itself contain sufficient information for the territorial authority to be satisfied as to the matters in subsections (1) and (2). However, the certificate can be useful in particularly complex cases to set out exactly what matters are being investigated when this is not clear from the request itself.

57.     Subsection (4) sets out the circumstances in which requests relating to fiscal offences may be accepted. If there is no agreement between the UK and the requesting country, and it is not a member of the Commonwealth, such requests shall be subject to a requirement of dual criminality - (that is, that the conduct, if it occurred in a part of the UK, would also constitute an offence under the law of that part of the UK). This follows existing practice.

Section 15: Nominating a court etc. to receive evidence

58.     This section provides for a court to be nominated to receive evidence under section 14 above, and covers proceedings currently governed by section 4 of the 1990 Act.

59.     The powers to nominate a court are conferred on the Secretary of State in England, Wales and Northern Ireland and on the Lord Advocate in Scotland. Where it appears that the request relates to an offence involving serious or complex fraud, the request may be referred to the Director of the Serious Fraud Office, or, in Scotland, a direction may be made applying the powers of investigation of a nominated officer under Part IV of the Criminal Law (Consolidation) (Scotland) Act 1995.

60.     Schedule 1 makes further provision in relation to proceedings of a court nominated to receive evidence.

Section 16: Extension of statutory search powers

61.     Subsection (1) replicates section 7(1) of the 1990 Act, which it replaces. Subsection (3) applies the provision to Northern Ireland. As with the provision in the 1990 Act, the section enables the appropriate authorities in England, Wales and Northern Ireland to apply for and execute a search warrant or a production order in response to an overseas request, in the same circumstances as would be possible in relation to a domestic case - (that is when the conduct in question would be a serious arrestable offence if committed here).

62.     Subsection (2)(b) provides that such a search warrant or production order may also be applied for and executed without an overseas request if the constable who makes the application is a member of an international joint investigation team (as defined in subsection (5)). Subsection (4)(b) provides similarly for Northern Ireland. These provisions implement Article 13(7) of the MLAC which contemplates investigative measures being undertaken without such a request by seconded members of a joint investigation team in relation to the team's investigations overseas. The constable making the application for the warrant or order would have personal knowledge of the joint investigation as he would in making such an application in a domestic investigation.

Section 17: Warrants in England and Wales or Northern Ireland

63.     This section replicates section 7(2) of the 1990 Act, which it replaces. It enables search warrants to be issued if the conditions in subsection (3) are satisfied. These conditions are that criminal proceedings overseas have been instituted or a person has been arrested in the course of a criminal investigation, the alleged criminal conduct would constitute an arrestable offence if it occurred in England and Wales or Northern Ireland, and there are reasonable grounds to suspect that there is evidence relating to the offence on premises here. This section enables the search of premises occupied or controlled by the suspect only.

Section 18: Warrants in Scotland

64.     This section is the Scottish equivalent to sections 16 and 17 and it serves the same purpose as those sections do in relation to England, Wales and Northern Ireland, consistent with Scottish procedure for search warrants. It replaces and largely replicates sections 8(1) and (2) of the 1990 Act, with the exception of inclusion of a reference to section 134 of the Criminal Procedure (Scotland) Act 1995. It gives a sheriff the same power to issue a warrant authorising entry, search and seizure by a constable or customs officer, as he would have under section 134 of the Criminal Procedure (Scotland) Act 1995. Before issuing such a warrant the sheriff must be satisfied that an offence under the law of a country outside the UK has been committed and that the conduct would have constituted an offence punishable by imprisonment if it had occurred in Scotland. In Scotland, with regard to joint investigation teams, the application for a search warrant will be made by the procurator fiscal on behalf of the team.

Section 19: Seized evidence

65.     This section deals with the treatment of any evidence that is seized under the procedures set out in sections 16 to 18. Article 6 of the MLAC requires the evidence to be sent directly to the court or authority which requested it. This is a departure from existing procedure established by the 1990 Act. It will speed up the provision of evidence by cutting out any central authority involvement once the evidence has been obtained. However, there will be circumstances when evidence may not be returned directly, (for example, when a country that is not party to the MLAC requires evidence to be returned via the central authority), and subsection (1) therefore provides that evidence may be sent directly to the requesting authority, or via the Secretary of State (or, in Scotland, the Lord Advocate). Subsection (3) provides that this section does not apply to evidence obtained by virtue of sections 16(2)(b) or (4)(b) or 18(2)(b) in an international joint investigation.

Section 20: Overseas freezing orders

66.     This section implements one of the key measures set out in the 2003 Framework Decision: the requirement to execute an overseas order to freeze evidence for its subsequent use in any proceedings or investigation in a participating country, where the order is made by a court or other authority in that country. The UK is already able to consider requests for mutual legal assistance in similar circumstances, but the 2003 Framework Decision is based on the principle of mutual recognition, and requires the UK to recognise the validity of an overseas order from a participating country, subject to certain conditions, rather than consider it as a request for mutual legal assistance.

67.     Subsection (2) defines an overseas freezing order.

68.     The section sets out the authorities competent to make overseas freezing orders, and the conditions for executing the order. Provided that the other requirements are met, the UK is obliged to execute orders relating to offences listed in the 2003 Framework Decision. The offences are defined in section 28(5) and (6) as an offence described in Article 3(2) of the 2003 Framework Decision or an offence prescribed (or of a description prescribed) by order.

69.     Overseas freezing orders must be accompanied by a certificate. Article 9 of the 2003 Framework Decision requires provision of a certificate, which must follow a standard format containing the details required in order that the receiving authority can execute the order. These will include, for example, details of the issuing authority, the person and offence under investigation, and the evidence sought.

70.     Frozen evidence is not automatically provided to the overseas authority that issued the order. It must issue a mutual legal assistance request, either simultaneously with the order, or at a later stage, in order for the evidence to be transmitted. This is provided for in section 24.

Section 21: Considering the order

71.     This section sets out the procedure when an overseas freezing order is received in the UK.

72.     Providing the conditions in section 20 are met, the territorial authority (defined in section 28 as the Secretary of State in England and Wales and Northern Ireland, and the Lord Advocate in Scotland) must refer the order to a court for execution. There is no discretion at this stage.

73.     The section provides for rules of court to set time limits for the court to consider the order and sets out the grounds on which the court may decide to refuse to execute an order. The grounds are if execution of the order would be incompatible with the Convention rights (as defined in the Human Rights Act 1998) and where the principle of double jeopardy is infringed - (that is where the person to whom the order relates would be entitled to be discharged under any rule of law in the participating country or the UK relating to previous acquittal or conviction).

Section 22: Giving effect to the order

74.     This section sets out how an overseas freezing order will be executed in practical terms. This will be done by issuing a domestic search warrant or production order. The procedures largely follow those provided for under the Police and Criminal Evidence Act 1984 ("PACE"). However, the warrants or orders will not be issued under PACE. They will be free-standing warrants or orders that will be issued in relation to the offences covered by the 2003 Framework Decision. PACE does not apply in Scotland which has its own search warrant procedure.

Section 23: Postponed effect

75.     This section sets out circumstances (covered in Article 7 of the 2003 Framework Decision) in which UK authorities may postpone giving effect to freezing orders. If the decision is taken to postpone acting on a freezing order, the requesting country will be informed accordingly. If the grounds for postponement cease, the order will then be given effect to under section 22.

Section 24: Evidence seized under the order

76.     This section provides that evidence which has been subject to a freezing order must be retained by the constable until the territorial authority gives him instructions either to send the evidence to the requesting authority or to release it. If the territorial authority has received a request from the overseas authority for the evidence to be sent, it may require a constable to send the evidence to the overseas authority. Otherwise, the territorial authority must order the release of the evidence under section 25(4).

Section 25: Release of evidence held under the order

77.     Under this section, the court may, in response to an application made by one of the persons listed in subsection (2), authorise the release of evidence by the constable. This would enable the persons mentioned in subsections (2)(a) and (2)(b) to apply for the release of the evidence seized in the event that the overseas freezing order were withdrawn, or if one of the conditions for non-execution in section 21 were met.

78.     It would also enable a third party affected by the order, for example the person whose property had been seized, to challenge the execution of the order on the grounds listed in subsection (1). Substantial reasons for issuing the overseas freezing order can, however, be challenged only in the country which issued the order.

Section 26: Powers under warrants

79.     This section relates to issuing warrants in relation both to mutual legal assistance requests under section 17 and overseas freezing orders under section 22.

80.     In line with PACE, subsection (1) prevents a warrant being issued if items sought are subject to legal privilege, excluded material or special procedure material (as defined in PACE under section 28(3)). Excluded or special procedure material must be obtained by issuing a less intrusive production order. Warrants in respect of such material can be sought only if a production order has been obtained and has failed to produce the evidence sought.

81.     Subsection (3) makes an amendment to the Criminal Justice and Police Act 2001, providing that the additional powers of seizure in that Act will apply to seizure of evidence relevant to overseas offences or investigations under these provisions.

Section 27: Exercise of powers by others

82.     This section provides for certain functions conferred on the Secretary of State or on a constable to be conferred upon others. This is in recognition of the MLAC requirement for direct transmission of requests. Currently, the authorities which deal with many requests for assistance, such as HM Customs and Excise, do not have the power to nominate courts or to apply for warrants in order to execute mutual legal assistance requests, and have to rely on the Secretary of State to nominate a court or issue a direction to make an application for a warrant.

83.     Therefore, this section contains an order-making power to provide that certain functions conferred on the Secretary of State or a constable may be exercisable by customs officers or persons acting under their direction. The practical effect of this power is that it would enable requests to be sent directly to HM Customs and Excise and fully executed by them, without recourse to the Secretary of State, in circumstances where a court nomination or application for a warrant is required, and will implement the principle of direct transmission more fully.

84.     Subsection (2) provides for the Secretary of State to confer similar powers on prescribed persons in the future. This could apply either to authorities that already execute requests, or be extended to other authorities that may take on a role in the execution of mutual legal assistance requests.

Section 28: Interpretation of Chapter 2

85.     This section defines the terms used in Chapter 2.

86.     Subsection (5) defines "a listed offence" as an offence described in Article 3(2) of the 2003 Framework Decision, or as an offence prescribed, or of a description prescribed, by an order made by the Secretary of State. The latter provision is necessary to cater for two circumstances: firstly, if the list of offences in the 2003 Framework Decision is added to by the European Council of Ministers. Secondly, it reflects the fact that under the 2003 Framework Decision freezing orders can be executed in respect of offences other than those listed but with the executing state able, if it wishes, to apply a dual criminality requirement. Subsection (6) therefore provides that any order which the Secretary of State makes (or, in relation to Scotland, the Scottish Ministers) in respect of a prescribed offence may require that the conduct involved must if it occurred in a part of the UK constitute an offence in that part.

Chapter 3: Hearing Evidence through Television Links or by Telephone

Section 29: Hearing witnesses abroad through television links

87.     Article 10 of the MLAC permits the hearing of witnesses by video link where it is neither possible nor desirable for the witness to travel from his Member State to that where his evidence is required.

88.     Outgoing requests from the UK are currently covered by the provisions contained in section 32 of the Criminal Justice Act 1988, and section 273 of the Criminal Procedure (Scotland) Act 1995, which allow the use of video links in limited circumstances. The Act does not change the current position on the types of case when video links can be used to import evidence into UK court proceedings, although the section makes provision for the Secretary of State (or, in relation to Scotland, the Scottish Ministers) to extend this provision to other types of criminal proceedings in the future.

Section 30: Hearing witnesses in the UK through television links

89.     This section introduces arrangements so that, for the first time, courts can take video evidence of witnesses for transmission abroad. All requests will be sent to the Secretary of State, (or, in Scotland, the Lord Advocate), who will then nominate a court where the hearing will take place. The proceedings will be subject to section 1 of the Perjury Act 1911, (in Northern Ireland, Article 3 of the Perjury (Northern Ireland) Order 1979, and, in Scotland, sections 44 to 46 of the Criminal Law (Consolidation) (Scotland) Act 1995 or any matter pertaining to the common law crime of perjury), and the rules on contempt of court will apply to the hearing. Although the hearing will not be a UK court proceeding, states must (in accordance with Article 10(8) of the MLAC), be able to deal with witnesses who refuse to testify or do not testify according to the truth under their domestic law.

90.     Subsection (6) makes reference to Schedule 2 to the Act which makes provision on procedural matters such as securing attendance of witnesses, the conduct of the hearing, and witness privilege. The domestic court must ensure that it protects the rights and privileges of the witness (such as the privilege against self-incrimination) and is to intervene where necessary to safeguard the rights of the witness. Translation must be available for the benefit of the court as well as the witness.

Section 31: Hearing witnesses in the UK by telephone

91.     Article 11 of the MLAC allows for courts to hear witnesses or experts by telephone within the scope of national law. This section allows the UK to respond to requests for assistance in arranging telephone hearings at the request of a participating country. All requests will be sent to the Secretary of State, (in Scotland, the Lord Advocate) who will then nominate a court where the hearing will take place. Unlike the provisions concerning evidence by television link, the witness or expert has to give his consent, in accordance with Article 11(2) of the MLAC, and subsection (3) provides that a request for a person to give evidence in this way must state that the witness is willing to give evidence. There is, therefore, no power to compel witnesses to attend the hearing. As with section 30, proceedings will be subject to the law on perjury, and the rules on contempt of court will apply to the hearing, but, except for these limited purposes, the evidence given before the nominated court is not to be treated as evidence given in UK proceedings. Some countries find telephone hearings a useful means of taking routine statements from key witnesses. As UK law does not provide any scope for evidence to be heard in this way there is no provision made here for outgoing requests.

Chapter 4: Information about Banking Transactions

92.     Sections 32 to 46 implement the 2001 Protocol. The purpose of the 2001 Protocol is to tackle serious crime, in particular economic crime and money laundering. Countries participating in the 2001 Protocol are obliged to identify, provide information about, and monitor bank accounts at the request of other participating countries, subject to certain restrictions and conditions which are explained in more detail below. The 2001 Protocol obliges participating countries to establish mechanisms whereby they can provide the stipulated information. The manner in which they do so is left to individual participating countries.

Sections 32: Customer Information

93.     Sections 32 and 33 implement the provisions of Article 1 of the 2001 Protocol in relation to incoming requests to provide information about bank accounts in the UK relating to a person who is the subject of an investigation in a participating country.

94.     Section 32 applies where the Secretary of State receives such a request and authorises him to direct the appropriate police or customs officer to apply for a customer information order. A customer information order requires a financial institution specified in the application to provide details of any accounts held by the person who is the subject of an investigation into serious criminal conduct as defined in section 46(3). Subsection (6) provides that the definition of customer information in section 364 of the Proceeds of Crime Act 2002 ("POCA") has effect to the extent specified. The scope of the 2001 Protocol is different to that of POCA, however, which is restricted to confiscation or money laundering investigations. In practice, the power will largely be used in relation to these types of investigations, but it may also be exercised in relation to other investigations into serious criminal conduct. Subsection (8) provides that information obtained should be returned to the Secretary of State for forwarding to the overseas authority which made the request. This is different to the procedure in section 19 of the Act which provides that, in general, evidence should be returned by direct channels. Transmission of information about banking transactions via the Secretary of State will enable effective monitoring of this new measure.

Section 33: Making, varying or discharging customer information orders

95.     This section sets out the conditions which must be satisfied before a judge may make a customer information order and what an application to the judge contains. Subsection (2) provides that the application may be made without notice (ex parte) to a judge in chambers. Subsection (4) provides for the discharge or variation of an order.

Section 34: Offences

96.     This section replicates section 366 of POCA, and provides for various criminal offences connected with failure to comply with customer information orders. The penalties, which are financial only, are directed at non-compliant institutions, rather than at individuals.

Section 35: Account Information

97.     Sections 35 and 36 implement Article 3 of the 2001 Protocol in relation to incoming requests. Article 3 provides for requests to be made for a specified account to be monitored during a specified period of time. Such a request might be made subsequent to an Article 1 request for bank details or in cases where the investigator already has the details of the relevant account. Account monitoring procedures were introduced in the UK under POCA, but separate provision is required in this Act to ensure that the UK can respond to all requests that meet the requirements of the 2001 Protocol which has a wider scope than POCA.

98.     Section 35 applies where the Secretary of State receives such a request and authorises him to direct the appropriate police or customs officer to apply for an account information order. An account information order requires a financial institution specified in the application to provide account information specified in the order (for example, details of all transactions passing through the account) during a specified period. Subsection (5) defines account information. Article 3(3) of the 2001 Protocol provides that the order shall be made with due regard for the national law of the requested Member State. Under POCA, account monitoring orders may be made for a period of up to 90 days and the same restriction will apply to requests under the 2001 Protocol. No limit is stated because the arrangements will be made between the relevant authorities on a case by case basis, as provided for in Article 3(4) of the 2001 Protocol.

Section 36: Making, varying or discharging account monitoring orders

99.     This section sets out the conditions which must be satisfied before a judge may make an account monitoring order in response to an overseas request, and the types of information that an application for such an order may specify. Subsection (2) provides that the application may be made without notice (ex parte) to a judge in chambers.

Sections 37 to 41: Customer information and account monitoring orders (Scotland)

100.     These sections are the corresponding Scottish provisions to sections 32 to 36 for England and Wales and Northern Ireland, and they have the same effect in Scotland as those sections do in the rest of the United Kingdom. They differ to take account of Scottish procedure - (for example, references to the procurator fiscal and the sheriff). They also refer to the corresponding Scottish provisions in POCA. In Scotland, the Lord Advocate carries out the functions given to the Secretary of State in the rest of the United Kingdom.

Section 42: Offence of disclosure

101.     This section creates criminal offences in relation to the unlawful disclosure of information. The purpose of the section is to ensure that financial institutions do not inform their customers of any requests for customer or account information, or that an investigation is being carried out, or that information has been passed on by the financial institution. A financial institution, or an employee of the institution, is guilty of an offence if it (or, as the case may be, the employee) discloses the types of information specified in subsection (3), and subsections (4) and (5) provide for the penalties which may be imposed if such an offence is committed.