Brokering (Weapons and Related Items) Controls Bill

Thank you, Madam Chair. I rise to take a call in respect of Part 1 of the Brokering (Weapons and Related Items) Controls Bill. I made a contribution in respect of the second reading of this, and, when I read this legislation, I thought that I’d like to have some clarity as to what the effect is of the definition of “brokering activity”, which is set out in clause 4 of the bill.

In clause 4, it says “has the meaning set out in section 5’”. Section 5—or clause 5 of the bill, as it is more properly described now—says, “In this Act, brokering activity (a) means arranging, facilitating, or negotiating a transaction that involves the international transfer of weapons or related items from a place outside New Zealand to another place outside New Zealand; and (b) includes,—(i) in relation to a transaction described in paragraph (a), acting as an agent for a person involved in the transaction or as an intermediary between 2 or more persons involved in the transaction; and”—also includes—“(ii) acquiring or storing weapons or … items in a place outside [of] New Zealand for the purpose of transferring [those] weapons or related items … outside [of] New Zealand; but (c) does not include the provision of service that is merely ancillary to [that] … (for example, the provision of administrative, customs broking, or financial services …”.

So it seems to me that we’re going after more than the person who is the broker; we’re going for agents of the broker. But I’m just wondering, as I read this, what level of involvement is required on the part of a New Zealander in order for them to be found an agent.

Now, one of the reasons why this is important is that this is an unusual piece of legislation in that it grants New Zealand courts the ability to prosecute New Zealanders for their actions outside of New Zealand. As I’ve already said, this also includes the facilitating or negotiating of transactions that involve the transfer of weapons outside of New Zealand. My understanding is that that work can, effectively, be done by a New Zealander outside of New Zealand and it will still be caught within the New Zealand criminal code, because, of course, a breach of this legislation carries with it penalties, which are set out in other parts of the Act. But, in order for that to happen, you have to be caught as being someone who is involved in a brokering activity.

This includes dual-use goods, and there’s some complexity around this. So I would be grateful if the Minister could explain—not immediately, but before the end of this debate—what level of involvement is required for you to be seen to be an agent. I don’t see that specifically. I know this is legislation that the Minister has inherited from the prior Government and that it’s been well considered by the Foreign Affairs, Defence and Trade Committee, but as I read the legislation I wasn’t clear what, in practice, would amount to that level of activity that would be caught by the bill. I know that there will have been some actual examples, probably, given by officials to the select committee as to what amounts to involvement that would be sufficient to bring this into play.

In the one minute and fifty-nine, fifty-eight—in the minute or so that I have available, I would also look to see whether we could also have some clarity as to what dual-use goods means. I understand that goods can have a civilian use but are intended for military end-use and they fall within a specified category. Could we have some indication as to how we’re going to find what is on that specified category? I’m thinking, for example, of global positioning systems. We know that some of the work that, for example, is done with global positioning systems—that that work can be used for a farm purpose or to position a device relative to an orchard, but it can also be used for military purposes. So we’re going to have to have some way in which we practically define that, so that we don’t catch, unintendedly, the things that shouldn’t be caught.

Excellent. Inspired choice for the call, Madam Chair—humble, of course, as well. Look, I’m very pleased to be standing up in this committee stage. I was very pleased to be chairing the Foreign Affairs, Defence and Trade Committee over the recent weeks and, as I always do, I want to thank the committee members for their work, and in particular the Minister, and the officials as well, who provided us with fantastic advice. I will apologise in advance that some of the questions I ask are as much, I suspect, for the education of the committee and the public than a lack of knowledge myself, because I noted in the second reading speech that this is actually a very good bill.

The overall context, without taking too much time, is we’re implementing a treaty here to bring into effect an international approach to arms brokering. Really importantly, we’re talking about, effectively, a third party who’s bringing weapons from one group or supplier and getting it to another. So we’re not talking about the selling directly of military weapons made in New Zealand. I mention that because a number of people, as they’ve approached me round this bill, are often questioning why there is nothing in this bill in any of the parts, including within the definitions, of why we’re not mentioning the selling of weapons from New Zealand. Fundamentally, there are other pieces of legislation which deal with that.

In terms of Part 1, I’d be interested to hear from the Minister in the chair, Tracey Martin. It’s really a small element, but clause 3 around the purpose—it’s an ordering question to the Minister. The purposes of the proposed Act both make sense. The first is to regulate the brokering of weapons and related items, and the second is to support New Zealand’s commitments under the Arms Trade Treaty. It’s probably a pedantic element, but why’s it in that order? I mean, in effect, this is an Arms Trade Treaty. Is that not the first purpose to bring about in this bill—to make sure we are good international citizens and that, as a consequence, New Zealand wishes to regulate the brokering of weapons and related items?

So it’s a small item. It wasn’t something which the committee spent a lot of time discussing but it’s—I suppose, again, when we look at the catalyst, Minister, for this bill, it was a treaty that was signed, I think, in New York a few years back. I’m sorry that the date slips my mind. You may be able to elucidate further for the benefit of the committee. But we are reacting to an international treaty. So it’s a simple point, but why has the Minister continued to allow paragraphs (a) and (b) of clause 3 to be in the order that they are?

The speaker that just resumed his seat, David Parker, did begin to pick up some really interesting points around brokering activities. Really importantly in the bill, this starts within clause 4, the interpretation clause, and then points to clause 5 around the meaning of brokering activities. As I indicated at the start, what we’re discussing here—and perhaps the best way is just purely to illustrate it—is a New Zealand citizen who, for example, is buying weaponry from Russia and selling it to Syria. That is what this bill attempts to capture and to stop. Well, I suppose an element which would be useful from the Minister, if time allows, is just to elucidate what is and is not noted as brokering activity—just how wide does that go?

The definitions are quite clear, I think. I think the select committee was relatively confident in them, but it’s always a welcome opportunity when we have the committee of the whole House to hear the Minister in charge of the bill, or a representative of the Minister in charge of the bill, to go into a little bit of depth. As the bill—the proposed Act—states in clause 5, brokering includes “arranging, facilitating, or negotiating a transaction that involves the international transfer of weapons”. So, again, we’re not expecting that a New Zealand citizen is the one necessarily picking up said items. It could just simply be, I’m assuming, facilitating activity online, be that through email or, God forbid, some sort of TradeMe equivalent in foreign arms. In fact, I shouldn’t be surprised, actually—one thinks of the dark net. We can think of a number of ways.

So it’s really just to give surety to the committee, if the Minister would, through the officials, talk about whether the definition of brokering activity—being “arranging, facilitating, or negotiating”—is full enough and captures it. I think we don’t want, as a committee, to fall in to the traps of a hole. We’ve even just seen in the paper today a small element around the Ministry of Business, Innovation and Employment where someone has missed out on payments. These are oversights which happen, so just some surety there would be most welcome.

In clause 4 within Part 1 there’s also the whole question—[Bell rung] Gosh, such enthusiasm from the other side—look, it’s fantastic.

I would just want to end, if I could, this contribution around the question of dual-use goods. Again it’s been lightly touched on by the Hon David Parker, who has just resumed his seat. A bit more elucidation from the Minister would be useful, probably, at this stage, just for that broader understanding of the committee. Not all items which are made are purely for military purposes. I mean, the most simple example, of course, is when we manufacture firearms. I’m not sure—although it would be interesting, Minister, if you could tell the committee—that anyone in New Zealand is manufacturing firearms. You can make a firearm, obviously, for the purposes of war but firearms can also be used, as is quite appropriate at the moment, for a bit of duck shooting. It’s similar too with guidance chips.

Obviously, we have a very successful company in New Zealand, Raycom, which makes guidance chips, which are particularly of use in joint direct attack munition bombs, if my knowledge serves me right, but also these chips can be used for other guidance services. One only does need to think of global positioning systems and so forth. So how exactly is the Minister’s ministry going to delineate between these dual-use goods, because particularly in the brokering space, and we heard this through the select committee, there are those items which it is just abundantly clear that New Zealanders should not be brokering between countries. But once you get into that dual-use area it gets rather complicated. We can see with countries overseas—the likes of Syria come to mind, even North Korea at the moment—that when certain items are being blocked for military purposes it can actually have an impact to the civilian side.

So I think the committee would—well, I certainly would and I suspect the committee would—appreciate some greater surety and clarity around how dual-use goods are defined, to give some certainty to us. I’m particularly thinking around the humanitarian side. We don’t want to end up being so tough on the brokering, or the military use of goods, that we are affecting the civilian population. I won’t go into it for too long, but there are enough stories that come out of the international media where various medical devices and products, particularly in the pharmaceutical space, are actually blocked because they supposedly have a military component to them, be it the nature of the drug or the fact that said drug or said medical device could be deployed by, or employed for, military personnel. But the corollary or the flip side to that, of course, is that it can help a civilian.

So it’s a very particular point, I have to say. When officials were in front of our committee they gave, I think, a very good explanation around these various dual-use goods but a little bit of elaboration would be good there. I suspect that plays into clause 4(1)(a), following around the whole notion of what is a military end-use, and it is clarified that—I’m pretty sure it is my understanding—it’s not only a specific and singular military use but there are elements which may both have a military and a non-military use.

The other elements of the definitions, I think, are relatively clear. In terms of the notions of dual-use goods it really begins to end with clause 4—I’ve lost track. We’re still in clause 4(1), to do with “strategic goods list”. I think it’s a really good decision in Supplementary Order Paper 24. Something that we did miss in the select committee is that, of course, we have the Customs and Excise Act being updated, so I think some our previous references were around 1996 and now most of it comes in to play in 2018. So, Minister, I think that’s been a good update from your officials. It’s really important that that Strategic Goods List is publicly available. I don’t believe that’s specifically noted in the—oh, I do apologise; we have added that in. In fact, I’m sure, as I look to my colleague Louisa Wall across the Chamber, there’s an element that we were keen to have, in that here we are noting that the secretary’s required to maintain and to publish that Strategic Goods List.

What might be of interest, whether or not the Minister can answer, is how often that will be updated. It wasn’t something the committee prescribed. I’m sure there’s a fairness and a natural justice, but we’re not expecting the Ministry of Foreign Affairs and Trade to be updating the Strategic Goods List every five minutes, but is it going to be every 3 months 6 months, a year? Some sort of indication around that would be quite useful.

Look, I have a few other contributions to make, but I think I’ve left the Minister a number of questions—brokered, if you will—and thoughts in my mind, and I look forward to the response.

Thank you for picking me from such a great array of possible speakers, Madam Chair.

Mr Simon O’Connor’s been talking about the dual-use goods list, and I will just touch on that very briefly, because, of course, the Strategic Goods List does set out exactly what the dual-use goods are—that is that everything after about page 30 falls into the dual-use goods. But in terms of that list, I would put to the Minister in the chair, Tracey Martin, whether there are satisfactory controls around that list, because as the bill says in the definition section, that list may be added to by a Gazette notice. Now, that, as I understand it, is a departmental decision and not a ministerial one. It is a very significant move to put something on that dual goods list, because people may be dealing in those items without realising that they have a military application. But, as we work through the legislation, we can see that the consequences of doing that are very significant. We know that people don’t tend to want to fall foul of the law through ignorance, but it does seem that it would be possible.

The Gazette notice is a disallowable instrument, but I would put it to the Minister that perhaps—I’d be interested in the Minister’s response as to whether that alone is a satisfactory protection. This will be a significant part of a network of legislation we have both in New Zealand and elsewhere in terms of arms control. As Mr O’Connor noted, it’s implementing the Arms Trade Treaty, and that is very, very important. Minister Parker also identified the question about what a brokering activity is, and whilst he looked at the activity itself, I would inquire as to whether, in fact, the cross-border nature of that definition is in fact appropriate, because the definition requires the international transfer of weapons. So if we’re going to be engaged in some way in brokering international transfer, we need to be registered and have a permit.

My concern is intranational transfers of weapons—that is to say a transfer of weapons which might occur entirely within a conflict zone like Afghanistan or Syria. Now, borders in those areas are so very porous that there’s a very good argument to say that that is a transfer and a brokering transaction, which should be regulated. Even though it happens entirely within one country’s national borders, there’s a very good argument to say that it should be regulated by the law of the State of the citizen who’s undertaking that transaction, because we know that the law of Syria or the law of Afghanistan—the civil society is not functioning in those jurisdictions, and that’s when we need to stand up and undertake our international duty. So, I would ask the Minister to consider the international transfer of weapons and whether it should, in fact, be any transfer of weapons in a foreign State or across a foreign State’s borders, for that very reason.

The other question is overseas equivalent regimes—so if a person is complying with an overseas regime, that is, in fact, a defence to any charge and you’re considered to be complying with it. The question is: what is an equivalent overseas regime? Obviously, it’s not going to be a mirror regime. In fact, our Strategic Goods List is a lot longer and a lot more extensive than a lot of other strategic goods lists in less-developed countries. So, in terms of that equivalent overseas regime, does it just mean a loose brokering and permitting regime, or does it mean a fully fledged and robust regime which, essentially, tracks our own legislation in quite a close way? There is a danger. There is the danger of finding the weakest link. So the difficulty is that arms brokers will simply look for the jurisdiction with the weakest regulatory regime and comply with that. If that happens, that’s really going to undermine to the Arms Trade Treaty and everything that New Zealand is aiming for. So that’s a further question I would ask the Minister to address.

Thank you, Madam Chair. It’s a pleasure to speak to this bill and to be a part of this debate. I think it’s interesting to look at the concerns that MPs brought to the Foreign Affairs, Defence and Trade Committee, how that was shaped by the select committee, whether there were still concerns at the end of the process, and how that aligned with the various submitters. I think if we look across some of the party positions—we heard my colleague David Parker speak a moment ago about his initial concerns and clearly still raising some of them with the Minister around dual use, and, in fact, he raised that at the first reading. Now, at that time, we were all actually working through the Rocket Lab legislation, and so we were doing parallel legislation, looking at dual-purpose situations—particularly GPS, as he’s mentioned. Although, I would note that one of the submitters also raised the question around drones and what the position with drones would be—clearly, some could be for sport but some might also have a military basis.

I think the question’s been put to the Minister: does the legislation correctly address this? I think we’ve heard the chair of the select committee talk to recommendation (b), clause 4(2), that does provide some clarity around dual use, but I think there is some work for the Minister to do there. I think Barry Coates also brought some concerns initially to the committee—some of them, I think, have been addressed in the committee process, some not. More specifically, Barry raised the question around whether mercenaries should be included in this sort of legislation. Now, I wasn’t privileged to be part of this committee, but I have had a brief look through and I don’t see that addressed. Maybe it’s outside the scope, or it’s something new that hasn’t subsequently been addressed, and maybe the Minister in the chair, Tracey Martin, could talk to that also.

If we then go across to the other party who I would mention, New Zealand First, Ron Mark was very emphatic as he came to select committee as to what his position was. He said in the House that, basically, this should be an amendment to the Customs and Excise Act, and I think his words were “What sort of palaver and waste of time is this?” It’s kind of interesting, now that it’s in the name of his leader, Winston Peters, that suddenly the member is quiet on that. Be that as it may, that was certainly what he brought to the first reading.

I think if we look at the nine submitters, there are a wide range of submitters. I think their submissions, as I looked at them, were thoughtful. They did raise questions that the officials needed to go away and work on. As we look at the recommendations that come from the select committee, as we interpret them, they seem to be addressing relatively well the concerns of the submitters. I think the recommendations are clear. I think the points we’ve heard raised—again from David Parker—around dual use do need just a little bit further clarification, but, otherwise, I thought, as the chair of the select committee had said, that most of the work was pretty straightforward.

So, there are a few points for the Minister to talk to. Again, I’m interested to know if New Zealand First are assuaged by this—with their vehement opposition to the first reading, did the select committee process change or help that? Are the Greens feeling that in Barry Coates’ absence the select committee addressed his questions around mercenaries, as well? I’d be very interested to hear that sort of response from the Minister, as well. Thank you, Madam Chair.

Kia ora. Thank you, Madam Chair. Just to address, or try to address, some of the questions raised by the honourable members: in the first instance, if I can just pick up on Mr Simon O’Connor’s question with regard to the order of the purposes: “(a) regulate the brokering of weapons and related items; and (b) support New Zealand’s commitments under the Arms Trade Treaty.” Mr O’Connor requested an explanation as to why they were in that order—for example, he suggested that that order should, in fact, be reversed because, in his view, this bill was here, in reality, to merely enforce the Arms Trade Treaty. My response to Mr O’Connor’s question is that, in the first instance, we tend to give items priority that affect New Zealand and what we are doing inside a New Zealand context. So when we regulate, we regulate inside the New Zealand context, and that is why clause 3(a) is “regulate the brokering of weapons and related items”. In the second instance, this is a supporting mechanism for a trade treaty and an arms trade treaty, as Mr O’Connor quite rightly pointed out, but we would always put first what it is that we are doing inside our own nation, because, obviously, the members of this House are here to serve this nation in the first instance.

If I go on to Mr Parker’s questions—and Mr O’Connor’s, I think, also; actually, I think every member has asked for a greater understanding of dual-use goods—dual-use goods are those goods that are included, as we have heard, in New Zealand’s Strategic Goods List (SGL). That is available online, Mr O’Connor, if you’d like to Google it with “strategic goods list” and then possibly put “NZ” at the end of it. You won’t get Singapore’s; you’ll actually get ours. That is maintained by the Secretary of Foreign Affairs and Trade under the regime established by section 56(2) of the Customs and Excise Act 1996. This will be covered by section 96 of the new Customs and Excise Act, should Mr O’Connor wish to look it up. In short, it’s called the SGL, and the SGL includes dual-use items listed by four international export control regimes that New Zealand participates in. The list is updated yearly, for those who asked when it was to be done. As an example of the types of things that you will find, should you go to have a look at the dual-use goods: nuclear reactors are on the dual-use list; chemicals of many different sorts, because they have two purposes, Mr O’Connor. You can either make them to harm someone, or you can use them to actually create something that helps people. Control rods: a variety of control rods are actually on that list. Cryogenic heat exchangers would be another example of something that is on the dual-use list.

There are some other questions that I do have from members. I will continue to try to get that advice for you as the debate goes on, but I hope, in the first instance, that has given some confidence to Mr Parker and to Mr O’Connor that there is nothing untoward, nothing scary, with regard to the piece of legislation. I hope that they have a clearer understanding of the two issues that they raised.

Thank you, Madam Chair. Thank you to the Minister in the chair, Tracey Martin, for that explanation; it is helpful. I know, certainly in my own electorate, of two manufacturers that supply military equipment which could easily be classed as dual-use—for example, mounts for weapons that go up on to a helicopter. Now, if any layperson saw those, they would have no idea that they have a military use. My concern would be if people were unwittingly buying those goods and then shifting them off overseas, how are the people who are those manufacturers captured by the bill? I’m for the bill; I’ve got no concerns about that. I just want to make sure we’re not spilling over and catching people who are quite innocently going about their business.

I also have another business within my electorate that supplies and fits out specialist boats for special services. They also could be bought, in parts, and retrofitted to another use, a military use, in another country. That could easily be a brokered deal. I know they are not the broker, and supposedly not captured in this bill, but they could be part of the chain of the deal. That’s how these deals are done, often, these days. You don’t need to be the person holding the goods, necessarily, to be a part of that chain. So I would like some assurance around that from the officials, perhaps, if the Minister doesn’t have those to hand.

But I do note, on the dual-use thing, that it is pretty broad, and, you know, one could imagine boots, for example, being dual-use goods that could be quite innocently also used. I see in the clause in the bill related to the definition that “military end-use means—(a) incorporation into military items that fall within a specified category; or (b) use, production, or testing of equipment and components for the development, production, or maintenance of military items that fall within a specified category; or (c) use of any unfinished products for the production of military items that fall within a specified category.”

I guess that’s the bit—particularly that last bit, “unfinished products”—where you have a known manufacturer that can build components that are quite specialised and could be ordered in isolation, and the manufacturer may not know that that’s going to be utilised as a mount for a military aircraft, for military weapons which could be used for sinister use. So how does that work for that specific manufacturer, and are they captured by this bill? I mean, the bill is laudable in its intentions, and I think we will get there, but we just have to ensure that we aren’t catching or capturing people who are going about their ordinary, lawful business with no sinister intent.

There’s no doubt at all that all of the conflicts in the world that are fought by terrorists and, sort of, quasi-armies—they get hold of their weapons somehow. This bill is trying to ensure that we, on our shores, have our laws squared away so that we are not a part of that problem. Meeting our treaty obligations is obviously very important in an international sense, and it’s great to see that New Zealand First have come along on this, because I note from Mr Mark’s speech from August in 2017 that, and I quote, “The peaceniks in the other parties loved the opportunity to dance around the maypole, sing Kumbaya and bag our boutique defence industry but not us.” So I’m wondering how long it took Mr Mark to learn to sing “Kumbaya” and to dance around the maypole. I would actually pay to see that. So, with that, Madam Chair, thank you.

Thank you, Madam Chair. Just to try and give some confidence around the definition of brokering, that has been asked for by several members: clause 5 defines brokering activity as “arranging, facilitating, or negotiating a transaction that involves the international transfer of weapons or related items from [one foreign country to another].” The definition includes a person who acts as an agent or intermediary for persons involved in the transaction, and someone who acquires or stores items outside New Zealand. Persons who provide services that are merely auxiliary to brokering activity are excluded. The purpose of regulating brokering is to prevent the movement of arms and military items to illegitimate users and undesirable destinations. It was considered appropriate to regulate those who have knowledge of the destination and end use of the weapons and related items. In a brokered transaction, that would most likely be the broker, including a person who acts as an agent or an intermediary.

Clause 5 of the bill has a definition of brokering which means “arranging, facilitating, or negotiating a transaction that involves the international transfer of weapons or related items from a place outside New Zealand to another place outside New Zealand” and includes “acting as an agent for a person involved in the transaction or as an intermediary between 2 or more persons involved in the transaction”.

The member who just contributed, Stuart Smith, mentioned boots and that he felt that the list that the Ministry of Foreign Affairs and Trade put together around dual use was rather diverse and possibly very wide, and he suggested that boots, for example, might be included because they have dual purposes. I have some confidence—I haven’t been through the whole list—that boots are not included on the list. I’m not sure the last time that a terrorist act was committed with a boot, although there was a shoe on a plane—there was a shoe on a plane. I would suggest that it would be the chemicals inside the shoe that are probably on the dual list. So I think therein lies the distinction. There needed to be another body of something to be added to that particular thing.

Goods either have to be military or on the dual-use goods list, and items such as boots—oh, there you go, I’ve had it confirmed. They are not on the list. They must be identified as military. Thank you.

Thank you, Madam Chair. I’m delighted to take a call on this. There are a couple of issues that have been touched on a little bit by some of my colleagues this evening, but I really want to speak to them a little more and find out a little more from the Minister about them.

The first is an issue that was raised by my colleague Dr Webb, and that’s the equivalent overseas regime. There’s a specific definition of it in clause 6 of the bill. As far as I can tell, an overseas regime is a regime that is roughly similar to the regime here in New Zealand, but the bit that I find very interesting in this is not just the idea that we might look for a roughly equivalent regime overseas, but someone has to make a judgment as to which regime is roughly similar, and in this case it’s the secretary—so that’s the Secretary of Foreign Affairs and Trade. I found that quite interesting because, I guess, the secretary is—her or his performance in their job is subject to review by the State Services Commissioner. Of course, they are appointed for a limited period of time, so what they do or don’t do in their job is subject to that kind of review as well. But I found it interesting that it is the Secretary of Foreign Affairs and Trade who makes the judgment as to what is an equivalent overseas regime. I would ordinarily have expected that it perhaps might be the Minister who made that decision. Even if it was on the advice of the secretary, it might have been the Minister who is ordinarily the person who is held responsible for those decisions. So I’m sure there’s a good reason for why the particular decision rests with the Secretary of Foreign Affairs and Trade rather than with the Minister, but I would be very interested to hear what that reason is so that I could understand.

I mean, it’s not unusual. It does happen in other legislation as well. We know that the Income Tax Act and the Tax Administration Act are full of references to the commissioner, who has a lot of discretion, but in this particular instance I really would like to know just exactly why that discretion has been shifted to the secretary. So that was the first aspect of this particular part of the bill that I would like to get some clarification on—just that little bit around the equivalent overseas regime.

The other bit that I find very interesting in this first part of the bill is who or what the bill applies to. I’m looking in particular at new clause 3A(1), and this has been inserted at the select committee stage of the process. So it’s obviously something that was very important, was raised by submitters to the bill, and that people wanted to see something going on here in the bill. I didn’t sit on that select committee so I don’t exactly know what the reasoning was. What it says is that “This Act applies to any brokering activity that is carried out—(a) in any place (… wholly or partially outside New Zealand [possibly]) and by a person—(i) who is in New Zealand or; (ii) who is a New Zealand citizen or ordinarily resident in New Zealand”. Now, that’s kind of interesting, because, ordinarily, if a New Zealand citizen commits some offence overseas, we normally rely on the other regime to prosecute them. We don’t try to prosecute New Zealand citizens for offences they’ve performed overseas. But in this particular instance, we are saying that a New Zealand citizen, no matter where she or he actually commits the offence against the Act—we’re asking that they nevertheless be held accountable in New Zealand.

Now, again, there are some equivalent sorts of laws. Actually, the ones that always come to mind for me are ones involving people who rape children overseas, and they can be held responsible under our laws here. So that’s the equivalent sort of thing. So I want to know why this has got that particular parallel in this law, that even if the offence is performed overseas we might nevertheless choose to prosecute it here.

So I’d really appreciate it if the Minister was able to just provide a little bit of enlightenment as to those two particular issues. Thank you.

Thank you, Madam Chair. Kia orana. I wonder if you would indulge me just for 20 seconds, Madam Chair, as a Waikato member of Parliament, to acknowledge that today the House stood to honour the memory of two Waikato members of Parliament, the Hon Katherine O’Regan and Tony Steel, who both died last week. I had the privilege of attending Katherine O’Regan’s funeral in Te Awamutu this afternoon, as did many former members of this House and some current ones. It was a beautiful service. Her memory was clearly upheld in a very appropriate way, and I know that she commanded respect across this House. I thank members opposite for the kind comments that they have made. I want to say how proud she would have been today of her extended family, and, as I say, it was a great privilege to be there. Madam Chair, thank you for that.

I have to say that as we return our consideration to Part 1 of this bill, it’s been fascinating to see so many members opposite, including Ministers and an under-secretary, all clamouring to take a call on this particular bill. I can only speculate as to why that might be, but it is, of course, a very significant and important measure. It should be noted that it was a measure introduced by the Hon Gerry Brownlee when he was a senior Minister in the previous Government. Others have already noted that it was something that was derided by one of the parties in this House, but it is good to see that there is a great deal of consensus around it.

Could I commend the Minister who is currently in the chair, the Hon Tracey Martin, for her willingness to engage so fully in this debate and to take the call on a couple of occasions now. I know that she has been ably assisted by some officials, as is often the case when people are in the position she is, but it is an important aspect of committee debates in this House that members are able to ask questions and, wherever possible, the Minister does his or her level best to answer them. So could I say to Mrs Martin, who inferred to me recently that I had gone off her Christmas card list, that I hope that by genuinely praising her for what she has endeavoured to do over the last 20 minutes or so, maybe I’ll get back on to it, because in the grand scheme of things, I would much rather be onside with her then offside with her.

But I also want to commend the member just to my right, the member for Tāmaki, Simon O’Connor, who does an excellent job in chairing our Foreign Affairs, Defence and Trade Committee and who has steered this bill to this point—yes, he’s getting his credit card out, and I have to say I’d prefer cash; I’m not so sure about the member’s card. But he has done an excellent job as the chair of this committee in steering this bill through the stages it’s gone through. The submissions were broadly supportive but also helpful, and I think that he has guided us, as have the officials who have assisted the committee, to bring back a bill that is even more fit for purpose and, as I’ve said, is a very significant measure on an international security issue that all like-minded countries need to ensure we are responding to appropriately. The brokering of weapons is something that, if mishandled or if inadequately controlled, could have devastating consequences, both in this country and abroad. So I am glad that members have understood its significance and have worked hard to ensure that we are playing our part as responsible global citizens.

As I’ve mentioned, several Ministers and members have already asked questions, and I imagine that the Minister in the chair will continue to try to answer some of those. It would be interesting to hear from her why her colleague the former deputy leader for New Zealand First took such a disparaging view of this bill and, as was mentioned earlier, spoke of the peaceniks in the other parties loving their opportunity to dance around the maypole and sing “Kumbaya”, because that, frankly, is a totally inappropriate remark to make about such a significant issue, and, perhaps less facetiously, he had said just nine months ago that this bill isn’t necessary. Well, quite clearly, now members of this House have concluded that it is, and as we move into later parts in this committee stage of the debate, we’ll look in more detail at some of its specific provisions. But here, as we look at the purpose of the bill in Part 1, it would be interesting to know why that was the view of the New Zealand First Party before the election and what has caused them to change their heart now.

I thank the honourable member Tim Macindoe for his contribution. I’ve just had some thank-you cards printed up; I may send him one just to acknowledge it. Can I just remark though, too, that I was a previous deputy leader of New Zealand First and I’ve never danced around a maypole, particularly not on this particular piece of legislation.

Can I refer to Mr Stuart Smith’s comments that people involved in the development of products that can have a military use are encouraged to engage with the Ministry of Foreign Affairs and Trade (MFAT) to clarify the extent to which their items may be subject to controls. It’s better to check than be caught out. Not all brokering or export of such products will be prevented. The goal here is to regulate the brokering to ensure that items do not fall into undesirable hands, so we would encourage those who have not done so already to contact MFAT and actually just run through that.

If I can address the member from my right, Deborah Russell, who asked about equivalent overseas regimes and why it is that the Secretary of Foreign Affairs and Trade is the person exercising that particular power—which is not really a power, but if I just describe what it is: “equivalent overseas regimes” means regimes imposed by those countries which are members of the four export control regimes, all of which use the same list of military and dual-use goods. The regimes are the Missile Technology Control Regime, Nuclear Suppliers Group, Australia Group, and Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies. The judgment of equivalent regimes is based on countries who have been accepted as members of a regime after meeting various criteria, and through analysis of the capability of that regime. So the secretary of foreign affairs, therefore, is not really exercising any particular discretion at all. It’s a process that goes through, and they merely get to be the person who has to ensure that that process has gone through.

If we can talk about extraterritorial jurisdictions, which I believe was also raised by the member, there is a need to control the actions of New Zealanders and New Zealand entities wherever they act, because of the cross-border nature of brokering and the need to work with other countries to prevent it. And quite rightly, as that member pointed out, these sorts of powers also apply to money-laundering, they apply to child sexual assault and some other quite nasty things, and I would suggest that the sending of weapons and other things that do harm to people is obviously one of those areas where if you are a New Zealander partaking in this sort of behaviour, then we will hold you accountable regardless of where you are. Kia ora.

Kumbaya, Madam Chair; kumbaya, Minister Martin; kumbaya, Mr Macindoe. It’s a real privilege to take a call on this very important piece of legislation, the Brokering (Weapons and Related Items) Controls Bill. I want to speak to a couple of items in Part 1, particularly clauses 3 and 4, where the Foreign Affairs, Defence and Trade Committee has responded to a couple of very well-reasoned submissions. But before leaping into that, I did just want to reflect on the member for Tāmaki, I think it was, who spoke of Barry Coates, a former member of the House, who participated in the earlier debates on this bill. As I was doing a bit of preparation for this debate, I read Mr Coates’ first reading speech on this bill, and he made the very good point in that speech that what we’re talking about here tonight isn’t actually academic for New Zealand. He pointed to a case in which a person who had a business based on Queen Street, I think it was, ended up, through an entity that he was involved in, possibly wittingly, possibly unwittingly, brokering arms trade between North Korea and Iran, I think it was.

So the bill that we’re debating is actually a really, really important one, because we as New Zealanders, not only in this Parliament, believe that we should be adhering to treaties of this kind—like the Arms Trade Treaty, which we are signed up to—as a matter of being a good international citizen. I think that most people in this country want to ensure, at an ethical level, that we aren’t in any way whatsoever involving ourselves in some of those awful conflicts around the world that cause mayhem, that cause death, that cause destruction, and that ruin many people’s lives. We should be minimising our involvement in those sorts of conflicts as much as possible, and this bill is a small piece in the wall there.

Just on that point as well, I think the question that the member for Tāmaki raised then—this relates to Part 1—was “Why doesn’t the bill specifically address the question of mercenaries?” And I think, actually, if we look in Part 1, clause 3, we just go straight to the purpose of the bill, which is really clear: “(a) regulate the brokering of weapons and related items; and (b) support New Zealand’s commitments under the Arms Trade Treaty.” So the purpose is actually really specifically defined—it is really specifically defined—around preventing brokering. Of course, brokering is not about weapons coming in or out of New Zealand; it’s about people in New Zealand, or connected to New Zealand, facilitating the transfer of weapons between people in other parts of the world, and, quite simply, that is what the bill focuses on. It doesn’t focus on who the people are who might be using them, which might be where you would get a question around mercenaries; it focuses simply on the question of brokering. So it’s a fairly simple and elegant bill there, and it goes to the purpose of the Arms Trade Treaty as well.

I might note that the Arms Trade Treaty started off, after agitation by people in the peace movement and civil society, way back in the 1980s—people like the Dalai Lama, but I also noticed José Ramos-Horta, who, of course, will be familiar to many people in New Zealand as being one of the people involved in the East Timorese independence movement. Of course, he and the people of East Timor were facing violent militias at the time of the independence movement in the 1990s, who were potentially being supplied by arms brokers around the world—so, very relevant there.

The two bits of the legislation that I wanted to focus on that have been amended by the committee relate to a couple of very good submissions that we received. The first one was from the New Zealand Law Society and what they noted, having considered the earlier version of the bill. What’s really important about Part 1, and a couple of other speakers have touched on this, is it goes to the jurisdictional issues. This bill is really interesting in that respect, and I think my colleague Deborah Russell mentioned this: that it doesn’t apply just to people in New Zealand doing things in New Zealand; it can apply to people who are ordinarily resident in New Zealand but are overseas engaging in brokering activities, or it could involve New Zealanders or entities connected with New Zealand who are overseas. So the jurisdictional stuff is really important to get right. What the Law Society say in their submission, at 3.4 of their submission is this, “The jurisdictional scope of the legislation is appropriate, but could be refined in three ways: [1] The territorial scope of the Bill should be defined upfront in Part 1 of the legislation, so that the reach of all of its provisions (including the registration requirements) is made clear;”—and I’ll touch on that in a moment, the detail of that—“[2] It may not be appropriate to extend the Act to persons who are not New Zealanders, who are not ordinarily resident here, and who have not conducted any brokering activities here;”. As far as I could read from the bill, the select committee has decided, in its wisdom, to proceed with that, but nevertheless! And [3] the Law Society says that “The exemption for employees should be tightened to prevent abuse.” and I think we’ll get on to that in Part 2 of the debate, which is where the select committee has made some changes in that area.

So let’s go back to No. 1, which is where the Law Society recommended some changes to—not really disagreeing with the intent of the bill but saying we really, really need to be specific and clear about the territorial scope of the bill. The select committee has responded to that by making amendments to clause 3A(1), which I don’t think you could make all that much clearer, notwithstanding some of the questions that have arisen in this debate. It’s very clear in clause 3A(1): “This Act applies to any brokering activity that is carried out—(a) in any place (including any brokering activity that is carried out wholly or partially outside New Zealand)”—so we’re going for belts and braces, and I think this was noted, and I think it was the Law Society’s submission as well, that some of the activity here could be quite fractional. So you have a person, potentially in New Zealand, who is engaging in some part of a transaction; you have a person in country B who’s engaging another part; and a person in country C; and one of the risks, if you don’t have the belts and braces approach to this kind of thing, is that each individual activity doesn’t amount to brokering; you’ve got to sort of make the chain. So by having that really clear language in clause 3A(1), it seems to me that we achieved that effect.

We then go on to note that it may be a person “(i) … in New Zealand; or (ii) who is a New Zealand citizen or ordinarily resident in New Zealand; or (iii) that is an entity incorporated or registered under the law of New Zealand;”—so individuals can’t skirt around this by putting these activities into a company or some other kind of organisation. And I think, very importantly, at clause 3A(1)(b) the activity could also be “wholly or partially on board a ship or an aircraft”, which sounds a little bit like it could be out of a James Bond episode or something. But, once again, we’re going for belts and braces there. So it seems to me that the select committee has actually really picked up on that quite important point about this being very, very specific about the jurisdictional scope and has really got the language right in clause 3A(1) of the bill.

The second submission I just wanted to speak to where a consequential change has been made was the letter that was written to the committee by the Regulations Review Committee. I did have to note one thing, though; and, of course, we always look to the Regulations Review Committee as being the committee that needs to be a paragon of exactitude and preciseness in terms of our parliamentary proceedings. In one of their paragraphs, there was quite an amusing typo, actually. It says, “Clause 9(1) of the bill imposes requirements on a person to be a registered broke”. I suspect it’s supposed to be a “broker”, because a registered broke could be a euphemism for an undischarged bankrupt, and I suspect that’s not who we are getting at. I am pretty sure that in the days in which the Hon Ruth Dyson chaired the Regulations Review Committee, we wouldn’t have had sloppy spelling mistakes like that one slipping into these letters.

But anyway, the point that the Regulations Review Committee makes is this one. I’ll get straight to the recommendation that they make and then how it’s been followed up by the committee. They recommend that the committee “consider amending clause 4(2) of the bill to require the Secretary of Foreign Affairs and Trade to publish a notice on a website administered by the Secretary of Foreign Affairs and Trade and, as the notice will affect items on the strategic goods list, ensure that the notice are published together with the strategic goods list.” I do think this is really, really important, and it links into some of the other submissions and some of the issues that I think we’ll also get to in Part 2, where there were some concerns that were threaded through the, I think, nine submissions that were received: that we have to be a little bit careful in this area; that people who might be caught out by what is quite a serious piece of legislation, which would certainly have serious reputational impacts and, potentially, has serious financial impacts—we have to make sure that the people who might be caught out by it know they have to register, know what the rules are, and that that’s very clear to people. So using a simple piece of technology like ensuring that it’s on the website, is, I think, an extremely important way of ensuring that.

I think it’s encouraging that we’re making progress on this bill. It goes to something that is, I think, not only about New Zealand’s international reputation; it’s actually an ethical issue about the kind of country that we want to be—the kinds of activities that we deem to be appropriate and ethical, or not—and saying that we’re not actually going to stand for people engaging in activity that could be to the detriment of people in other parts of the world. It seems to me, having had a good look at the submissions and having had a good look at the bar 2 version of the bill that we have before us, that the select committee has engaged really constructively and really sensibly around some of the good submissions that have been made.

On that note, I think, in line with other members—certainly on this side of the Chamber but, it looks like, more broadly—I certainly commend the bill to the committee as it’s been reported back. Kumbaya—peace out.

Thank you, Madam Chair. I’d just like to start by also supporting Tim Macindoe’s comments around it being good to see the Minister in the chair, Tracey Martin, actually taking calls. I have to say I’m not as worried about being on her Christmas card list. I’m sure she understands why.

I also wanted to actually mention a contribution made by Deborah Russell, because it was a very good one, and she raised a point that I’d still like the Minister to address, which hasn’t been fully addressed. I’m actually going to use a personal example around it, and that is the successful prosecution and conviction of Kiwis that are engaging in offshore transactions.

I’m actually really proud of this bill. I think it’s a very good bill, and, as a nation and as a country, we should be proud that we’re taking positive steps towards making sure that we can never be involved in the type of behaviour that’s being talked about tonight around weapons and the harm and the pain that they cause, especially in conflict areas.

So the example that I want to use—and the Minister can come back and address the issue that was raised by Deborah Russell—is that back in 2004, I was appointed by the interim Government in Iraq to establish what’s called the Provincial Joint Operations Centre. It was the centre that was formed to train—it performed two real functions. The first one was to train all the newly formed Iraqi security forces, so you had the Iraqi Police Service; you had the Iraqi National Guard; you had the tactical support unit, which was, effectively, like our armed offenders squad or our Special Tactics Group; you had the borders and customs police; and you had the facilities protections police, and the Facilities Protection Service was really about guarding critical infrastructure—so the ports, the airports, the port of Umm Qasr, or Khawr az-Zubayr. So we, fundamentally, had five services there.

The first function was to deliver all the training to the command element—so that was major rank upwards—and the second role was to provide command and control in an operations centre in terms of coordinating the operations that were going on, particularly in the Basra area but also more widely in the Dhi Qar province.

There were three real threats that we were dealing with. One was the highly organised criminal gangs that were normally sponsored by the tribes, the second was, obviously, al-Qaeda, and the third was the Mahdi militia, who were led by Muqtada al-Sadr, who is now actually part of the political solution in Baghdad, although you would have seen that there was a riot in Baghdad last summer and it was actually led by Muqtada al-Sadr, and he remains in Parliament. I’m not sure what would happen here if a New Zealand MP was to lead a riot, and I guess that’s why we’re so lucky to be living in the country that we are and having the democracy and the Parliament that we have.

So the issue that I raise—and it comes back to the point that Deborah Russell made—was that the biggest threat that these guys were having to deal with when they were out on operations was always coming up against—whether it was a highly organised criminal gang or whether it was al-Qaeda or whether it was the Mahdi militia or one of the militias operating, they were all heavily armed, and they were heavily armed with weapons that weren’t procured with an end use certificate or procured through the normal channels. They were procured on the black market, and obviously, the black market avoids regulation. It doesn’t want to adhere to regulation and rules, and so it’s very hard to police and it’s very hard to shut down when you’re dealing with very porous borders. But the good news is that the international community has become far more organised around it, and we see treaties like the one we’re now legislating to support and we see people like Viktor Bout sitting in a prison in Thailand, which is a good thing.

But it brings me back to the question and the issue that was raised by Deborah Russell, and that’s—quite simply—if a Kiwi engages with the procurement of weapons overseas and those weapons find themselves in a conflict zone without an end use certificate and without the proper paperwork or the proper process having been adhered to, talk us through how we’re actually going to gather the evidence and how we’re going to charge and going to convict that person, because I think every single one of us in this Parliament and in this country wants to see that person convicted. Thank you, Madam Chair.

The question was put that the amendments set out on Supplementary Order Paper 24 in the name of the Rt Hon Winston Peters to clause 4 be agreed to.

Amendments agreed to.

Part 1 as amended agreed to.

Part 2 Brokering activity, registration, and permits