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Explanatory Notes

Serious Crime Act 2007

2007 CHAPTER 27

30th October 2007

Introduction

1.These explanatory notes relate to the Serious Crime Act which received Royal Assent on 30^th October 2007. They have been prepared by the Home Office in order to assist the reader of the Act. They do not form part of the Act and have not been endorsed by Parliament.

2.The notes need to be read in conjunction with the Act. They are not, and are not meant to be, a comprehensive description of the Act. So where a section or part of a section does not seem to require any explanation or comment, none is given.

Summary

Part 1 - Serious Crime Prevention Orders

3.Part 1 creates Serious Crime Prevention Orders, a new civil order aimed at preventing serious crime. These orders will be used against those involved in serious crime and the purpose of their terms will be to protect the public by preventing, restricting or disrupting involvement in serious crime. They will be made on application to the High Court, or the Crown Court upon conviction, and breach of the order will be a criminal offence. The Act provides for rights of appeal and variation or discharge of the order.

Part 2 - Encouraging or Assisting Crime

4.The Government’s policy on the reform of the criminal law on encouraging and assisting crime is based on the Law Commission’s Report on Inchoate Liability for Assisting and Encouraging Crime (Law Com No. 300, CM 6878, 2006). The Law Commission’s Report did not deal with the position in Northern Ireland.

5.The Act abolishes the common law offence of incitement and in its place creates new offences of intentionally encouraging or assisting crime and encouraging or assisting crime believing that an offence, or one or more offences, will be committed. The Act contains a defence to the offences in Part 2 (where the encouragement or assistance is considered to be reasonable in the circumstances) and an exemption from liability where the offence encouraged or assisted was created in order to protect a category of people (and the person doing the encouragement or assistance falls into that category).

Part 3 - Other Measures to Prevent or Disrupt Serious and Other Crime

6.Part 3 is divided into 3 chapters. Chapter 1 makes provision for the prevention of fraud. Chapter 2 makes a number of amendments to the Proceeds of Crime Act 2002 and supporting legislation. These transfer certain functions of the Assets Recovery Agency to the Serious Organised Crime Agency and other persons; extend the powers of civilian financial investigators operating under that Act; provide investigation powers under Part 8 in respect of the cash forfeiture regime under Chapter 3 of Part 5 of that Act and powers in Part 8 to force entry in the execution of search warrants issued and executed in Scotland. Chapter 3 extends certain investigatory powers of officers of Her Majesty’s Revenue and Customs to former Inland Revenue matters (which powers are currently limited to former Customs matters) and extends an existing police power to stop and search for dangerous instruments and offensive weapons without reasonable suspicion.

Part 4 - General and Final Provisions

7.Part 4 deals with miscellaneous and general provisions within the Act, including the making of orders under the Act.

Background

8.The Government published the Green Paper ‘New Powers Against Organised and Financial Crime’ (CM 6875) on 17^th July 2006. The Green Paper set out a package of measures to improve the ability of law enforcement agencies to tackle fraud and serious organised crime. The Green Paper can be found at

http://www.homeoffice.gov.uk/documents/cons-2006-new-powers-org-crime/.

9.The document summarising the responses that were received to the consultation is available at:

http://www.homeoffice.gov.uk/documents/powers-against-org-crime.pdf?version=1

Territorial Extent

10.The majority of the Act's provisions extend to England and Wales, while certain provisions also extend to Scotland and Northern Ireland. The Act addresses both reserved and devolved matters. A number of provisions extend to Scotland only or Northern Ireland only. Section 93 provides detail of the extent of provisions within the Act.

11.Part 1 (Serious Crime Prevention Orders) and Part 2 (encouraging or assisting crime) mainly extend to England and Wales and Northern Ireland. Sections 68 to 72 (sharing information with anti-fraud organisations), section 74 and Schedules 8 and 9 (abolition of Assets Recovery Agency and redistribution of functions etc.) and section 88 and Schedule 12 (regulation of investigatory powers) mainly extend throughout the UK. Section 73 and Schedule 7 (data matching) make separate provision for England, Wales and Northern Ireland. Sections 75 to 86 and Schedules 10 and 11 (detained cash investigations, extension of powers of accredited financial investigators, civil recovery management receivers and power of forced entry) have the same extent as the provisions which they amend (some of which have a UK extent and some of which have a more limited extent). Section 84 extends throughout the UK. Section 87 (extension of police powers to stop and search for dangerous instruments and offensive weapons) extends to England and Wales only.

12.The Scottish Parliament's consent has been obtained for the provisions in the Act relating to the creation of an offence of breach of a Serious Crime Prevention Order (with reference to Part 1 of the Act) and detained cash investigations and power of forced entry (with reference to Part 3 Chapter 2), which trigger the Sewel Convention. The Sewel Convention provides that Westminster will not normally legislate with regard to devolved matters in Scotland without the consent of the Scottish Parliament.

Territorial Application: Wales

13.All of the provisions in the Act will apply to Wales.

Commentary on Sections

Part 1: Serious Crime Prevention Orders. General

Section 1: Serious crime prevention orders

14.This section gives the High Court the power to make a Serious Crime Prevention Order (“an order”). A Serious Crime Prevention Order is a new kind of civil injunctive order which is aimed at preventing serious crime. If a person breaches an order he commits a criminal offence. Subsection (1) sets out the test which the High Court in England and Wales must apply to determine whether such an order can be made. It provides that an order may be made if the Court is satisfied that a person has been involved in serious crime, whether that involvement was in England and Wales or elsewhere in the world, and where it has reasonable grounds to believe that the order would protect the public by preventing, restricting or disrupting involvement by the subject of the order in serious crime in England and Wales. Under the first part of the test in section 1(1)(a) a person can be involved in serious crime that has occurred in England and Wales or elsewhere. Under the second part of the test in section 1(1)(b) the public must be protected from the involvement of a person in serious crime in England and Wales only. Being ‘involved’ in serious crime in England and Wales or elsewhere is defined in sections 2 and 4. ‘Involvement’ in serious crime in England and Wales is defined in section 2(3). Subsection (2) provides for the same provision for Northern Ireland as is set out for England and Wales in subsection (1). Subsection (3) provides that the Court may impose such terms in the order, whether prohibitions, restrictions, requirements or other terms, as it considers appropriate so as to protect the public by preventing, restricting or disrupting the involvement of the subject of the order in serious crime. Subsection (4) provides that the powers in section 1 to make such an order are subject to the safeguards set out in sections 6 to 15 of the Act.

15.Subsection (5) provides that, for the purposes of Part 1 of the Act, the term “serious crime prevention order” means either an order under this section or an order under section 19. Section 19 makes provision for the Crown Court, rather than the High Court, to make an order following the conviction of the subject of the order for a serious offence. Subsection (6) provides that, in Part 1 of the Act, any reference to the subject of a serious crime prevention order is a reference to the person from whom the public is to be protected, namely the person who has been involved in serious crime and whose involvement in serious crime is to be prevented, restricted or disrupted.

Section 2: Involvement in serious crime: England and Wales orders

16.This section defines what constitutes both having been involved in serious crime in England and Wales or elsewhere, and involvement in serious crime in England and Wales, in relation to Part 1 of the Act. A distinction is drawn between these two phrases because the first part of the test, in section 1(1)(a), is concerned with a person who has been involved in serious crime in England and Wales or elsewhere, whereas the second part of the test, in section 1(1)(b), is concerned with future involvement in serious crime in England and Wales only. This distinction is also relevant elsewhere in the Act, in particular in section 19(2) which is concerned with orders to be made by the Crown Court. Subsection (1) sets out that a person has been involved in serious crime, in England and Wales in relation to the first part of the statutory test in section 1(1), if he has committed a serious offence in England and Wales, has facilitated the commission by another person of a serious offence in England and Wales, or has conducted himself in a way that was likely to facilitate the commission by himself or another person of a serious offence in England and Wales (whether or not such an offence was committed). Facilitation here takes its natural meaning of ‘to make easier’.

17.Further to this, subsection (2) sets out that a ‘serious offence in England and Wales’ is one which, at the time the court considers the application for an order or the matter in question, is contained in the list set out in Part 1 of Schedule 1 to the Act, or is an offence which is sufficiently serious that the court considers it should be treated as if it were set out in that list. The list in Part 1 of Schedule 1 is not an exhaustive list and the second part of the test allows the court to treat offences that do not appear in Part 1 of Schedule 1 as being serious offences.

18.Subsection (3) defines ‘involvement in serious crime in England and Wales’ for the purposes of the second part of the statutory test contained in section 1(1)(b). That part of the test sets out the harm from which the public must be protected. The court must have reasonable grounds to believe that the order will prevent, restrict or disrupt the involvement of the respondent in serious crime in England and Wales. Involvement in serious crime in England and Wales means one or more of the following: the commission of a serious offence in England and Wales; conduct which facilitates the commission by another person of a serious offence in England or Wales; conduct which is likely to facilitate the commission, by the person whose conduct it is or another person, of a serious offence in England and Wales (whether or not such an offence is committed).

19.Subsection (4) defines what is meant by the respondent having been involved in serious crime in a place other than England and Wales for the purposes of Part 1 of the Act. This is for the purposes of the first part of the statutory test contained in section 1(1)(a), relating to past action which merits the imposition of an order. Subsection (4) makes identical provision to subsection (1), except insofar as this subsection is concerned with serious offences which have occurred elsewhere in the world than in England and Wales.

20.Subsection (5) defines a ‘serious offence in a country outside England and Wales’. The court has to apply a three stage test. Firstly, the conduct must be an offence in the place outside England and Wales. Secondly, at the time the court considers the application for an order or the matter in question, the conduct must be an offence in England and Wales if it had been committed in or as regards England and Wales. Thirdly, at that time, the offence would fall within the list of offences, or within a description specified, in Part 1 of Schedule 1 to the Act if committed in or as regards England and Wales or it is conduct which the court considers is sufficiently serious so as to be treated as if it did so.

21.Subsection (6) states that the test set out in subsection (4), rather than the test in section 3(1), should be used when an England and Wales court is determining whether a person has been involved in serious crime in Northern Ireland for the purposes of an England and Wales order.

22.Subsection (7) provides that, when considering whether conduct is an offence under the law of a country outside the UK, the test will be met however the conduct is described in that law. This means that even if an act is not described as an offence in the law of the other country it will still be a serious offence under Part 1 of the Act if it meets the test in subsection (5).

Section 3: Involvement in serious crime: Northern Ireland orders

23.This section defines what constitutes both having been involved in serious crime in Northern Ireland and involvement in serious crime in Northern Ireland, in relation to Part 1 of the Act. The section also defines what constitutes having been involved in serious crime elsewhere than in Northern Ireland. The subsections of this section are the same as that provided for in section 2 (above) but for Northern Ireland.

Section 4: Involvement in serious crime: supplementary

24.Subsection (1) states that the court, when it is considering whether a person has committed a serious offence, must only decide that he has done so if he has been convicted of the offence and that conviction has not been quashed on appeal nor has he been pardoned of the offence.

25.Subsection (2) provides that, when considering whether the proposed subject of the order (“the respondent”) facilitates the commission by another person of a serious offence, the court must ignore any act that the respondent can show to be reasonable in the circumstances. Subsection (3) similarly provides for such an act to be ignored when considering whether the respondent conducts himself in a way that is likely to facilitate the commission by himself or another of a serious offence. Subject to this, the court must ignore the intentions and other aspects of the mental state of the respondent at the time of the act in question. This means that it does not matter if the respondent did not, for example, intend to facilitate the commission of a serious offence, or had no knowledge that he was conducting himself in a way that was likely to facilitate serious crime.

26.Subsection (4) provides the Secretary of State the power to amend Schedule 1 by order.

Section 5: Type of provision that may be made by orders

27.This section contains examples of the types of provisions that a serious crime prevention order might include, but does not limit the flexibility of the court, provided for by section 1(3), to impose such provisions as it thinks appropriate for the purposes of protecting the public by preventing, restricting or disrupting the subject’s involvement in serious crime. Subsection (2) sets out that the order may require that the subject of the order does or does not do something outside England and Wales or Northern Ireland, provided that the provision prevents, restricts or disrupts involvement by the respondent in serious crime in England and Wales or Northern Ireland.

28.Subsection (3) sets out examples of possible prohibitions, restrictions or requirements which might be placed on an individual (including partners in a partnership) by an order. These prohibitions, restrictions or requirements might relate to, for example, a person’s travel, financial dealings or the people with whom he is allowed to associate.

29.Subsection (4) provides similar examples of prohibitions, restrictions or requirements which might be imposed on bodies corporate, partnerships and unincorporated associations. These prohibitions, restrictions or requirements might relate to, for example, the provision of goods and services, the way in which that body conducts its financial dealings or its employment of staff.

30.Subsection (5) allows the details of how questions are to be answered, information provided or documents produced to be left by the court to the discretion of a law enforcement officer. The subsection provides that where the terms of an order contain a requirement relating to the answering of questions or the provision of information, a law enforcement officer specified or described in the order may specify the following elements of how that requirement of the order should be complied with: the timing (including within a period or at a frequency); the location, the form and manner; and to which law enforcement officer or description of law enforcement officer the information or answers are to be provided. The same is true in relation to the production of a document, except that there is no provision for specifying the form in which it should be produced, as the form of a document will be determined by the way the information it contains is recorded and the provisions of subsections (7) and (8).

31.Subsection (6) expressly states that any prohibitions, restrictions or requirements which are imposed as terms of an order on an individual may be in relation to an individual’s private dwelling. This would, for example, enable the court to include a term in an order which placed a prohibition, restriction or requirement on where an individual was able to reside provided, in the circumstances of the case, such a term would meet the test in section 1(1)(b) and would be proportionate.

32.Subsection (7) defines the terms ‘document’, ‘law enforcement officer’ and ‘premises’. The definition of law enforcement officer includes a reference to a member of the staff of the Serious Organised Crime Agency (“SOCA”) who is for the time being designated under section 43 of the Serious Organised Crime and Police Act 2005 (c. 15). Under section 43 a member of the staff of SOCA can be designated with the powers of a constable, the customs powers of an officer of Revenue and Customs or the powers of an immigration officer. Only a member of the staff of SOCA who has been designated with the powers of a constable would be able to exercise these powers because these are not customs powers or immigration officers’ powers. Also included within this definition are officers of Her Majesty’s Revenue and Customs and members of the Serious Fraud Office. Subsection (8) provides that any document which is produced must be rendered in legible form.

General safeguards in relation to orders

Section 6: Any individual must be 18 or over

33.This section states that an order must not be imposed on anyone under the age of 18.

Section 7: Other exceptions

34.This section provides that the Secretary of State may, by order, expressly exclude the application of serious crime prevention orders to persons falling within a specified description. At the moment an order can be imposed on any person and this includes individuals, bodies corporate, partnerships and unincorporated associations. An order under this section will be subject to the negative resolution procedure.

Section 8: Limited class of applicants for making of orders

35.This section provides that an order in the case of England and Wales can only be applied for by the Director of Public Prosecutions, the Director of Revenue and Customs Prosecutions or the Director of the Serious Fraud Office. It is expected that a Director will decide whether or not to make an application on the basis of information from law enforcement agencies such as the police, Revenue and Customs and SOCA. In the case of Northern Ireland an order may be applied for by the Director of Public Prosecutions for Northern Ireland. These persons are referred to elsewhere in the Act as the relevant applicant authorities.

Section 9: Right of third parties to make representations

36.This section provides a safeguard where the making, variation or discharge of an order or not making a variation to an order or discharging it would be likely to have a significant adverse effect on someone who is not the subject of the order. This section gives the court the power to allow such persons to make representations at the hearing in relation to the making, variation or discharge of an order. Subsection (1) states that in such a situation, the High Court must, when considering the making of an order, on application by such a person, give the person the opportunity to make representations to the court if it considers that the making of an order would be likely to have a significant adverse effect on that person. Subsections (2) and (3) provide that the court must give a person the opportunity to make representations at a variation or discharge hearing if it considers that they are likely to be significantly adversely affected by a decision to vary, discharge or not vary or discharge.

37.Subsection (4) imposes a similar requirement on the Crown Court if it is considering making an order under section 19, or varying an order under its powers in sections 20 or 21, if it considers that the making or variation of an order (or the decision not to vary an order) is likely to have a significant adverse effect on that person.

38.Subsection (5) provides that, where a court is considering an appeal in relation to an order, it must, upon application, give a person the opportunity to make representations to the court if that person was given such an opportunity at the original hearing.

Section 10: Notice requirements in relation to orders

39.This section makes provision for ensuring that the subject of the order has notice of its existence. An order will not necessarily be made in the presence of the subject of the order. Under the Civil Procedure Rules (with amendments if necessary), if the applicant for the order can satisfy the court that the notice of the application for an order was served on the subject of the order and the court is satisfied that the test for making an order is met, the court will make the order even if the subject of the order has not appeared for the hearing. However, in such a situation the order cannot take effect unless a notice setting out the terms of the order has been served on the subject of the order. Subsection (1) states that a person is bound by the terms of an order if he is represented (whether in person or otherwise) at the hearing at which the order, or variation of the terms of the order, is made, or if a notice setting out the terms of the order, or variation, has been served on him. Service may be, as stipulated in subsection (2), either in person or by recorded delivery to the subject at their last known address. Subsection (3) provides a power for a constable or person authorised by the relevant applicant authority, to enter and search for the person concerned, by force if necessary, any premises where they have reasonable grounds for believing the subject to be. Subsection (4) provides the definition of “the relevant applicant authority”. The effect of the definition is that the relevant applicant authority will be the prosecutor that applied for the order.

Information safeguards

Section 11: Restrictions on oral answers

40.This section makes clear that these orders will not be used as a means of forcing the subject of an order to answer questions, or provide information, orally. This limits the extent to which a requirement under section 5(5) can operate.

Section 12: Restrictions for legal professional privilege

41.This section provides that an order does not override legal professional privilege. Subsection (1) provides that an order cannot require its subject to answer a privileged question, provide privileged information or produce a privileged document. Subsections (2)–(4) state that these terms refer to a privilege which the subject would be able to rely on in the High Court. Subsection (5) provides that, notwithstanding the protection in subsection (1), an order may require a lawyer to provide the name and address of a client.

Section 13: Restrictions on excluded material and banking information

42.This section sets out further safeguards by placing restrictions on the extent to which an order can require the production of excluded material and banking information. Subsection (1) provides that an order may not require a person to produce any excluded material. Excluded material in the case of England and Wales is defined with reference to section 11 of the Police and Criminal Evidence Act 1984. Section 11 provides that excluded material means:

personal records which a person has acquired or created in the course of any trade, business, profession or other occupation or for the purposes of any paid or unpaid office and which he holds in confidence;
human tissue or tissue fluid which has been taken for the purposes of diagnosis or medical treatment and which a person holds in confidence; and
journalistic material which a person holds in confidence and which consists of documents or of records other than documents.

43.Excluded material in the case of Northern Ireland is defined with reference to article 13 of the Police and Criminal Evidence (Northern Ireland) Order 1989.

44.Subsections (2) to (4) are concerned with banking information. Subsection (2) provides that an order may not require a person to disclose any information or produce any document which is the subject of a duty of confidence from a banking business, unless either of the conditions contained in subsections (3) and (4) are met. The first condition is that the person to whom the duty is owed consents to the disclosure. The second condition contains two alternatives. The first alternative is that there is specific provision in the order for the disclosure of such information, in other words an express requirement for the production of banking information in general. The second alternative is that there is a specific requirement to disclose specified information or a specified document which amounts to banking information.

Section 14: Restrictions relating to other enactments

45.This section makes provision for the interaction between an order and prohibitions on the disclosure of information contained in enactments. Subsection (1) provides that an order cannot require a person either to answer any questions, provide any information or produce any documents, if he is prohibited from doing so under any other enactment. Subsection (2) contains a number of definitions.

Section 15: Restrictions on use of information obtained

46.This section relates to the interaction between the provisions of an order and the need to protect the privilege against self-incrimination. Subsection (1) provides that a statement (which by virtue of section 11 can only be a written statement), provided by a person as a result of a requirement in an order, cannot be used against him in criminal proceedings except if either one of two conditions are met.