Category Archives: Hansard

My Lords, it is a pleasure to follow my friend, the noble Lord, Lord Clement-Jones. In doing so, I declare my technology interests as set out in the register. Like other noble Lords, I have, rightfully, a long list of thanks, not least to all those witnesses who gave oral and written evidence to our Special Bill Committee; to Matthew Burton, our clerk, and all his team; to the Minister for his careful and thoughtful engagement, and all his officials; and not least to the noble Lord, Lord Anderson, for his excellent chairing of our Special Bill Committee.

This is a short Bill, but one with significant impact for the UK, and indeed beyond our shores, because through our legislative process, the world is watching what we do in this space. We have a great fintech tradition in this country, a great fintech ecosystem, and whether it is financial market infrastructure, dematerialisation of our capital markets or crucially important financial inclusion, digital assets have a critical role to play. With some trillions of the UK and world economy due to be transacted by digital assets by the end of this decade, the UK needs to ensure that it is well set for this future. The Bill does this through non-prescription, but using the great good fortune of English and Welsh common law, with its agility and its adaptability, as the Minister rightly said, for new technologies not yet even imagined.

It was an extraordinary pleasure to be part of this legislative process. My only question for the Minister is whether there is a schedule yet in the other place, so we can ensure that Bill becomes law as soon as possible. Not only does it send a signal to the world; it sends a signal to all those involved in digital assets in this country that with the financial centre of London and our fantastic fintech start-ups, scale-ups and larger businesses, London and the United Kingdom is an excellent place to be involved in digital assets business.

My Lords, last month I published a report making the case for cross-sector AI legislation. Is it not clear that AI is already impacting, positively and otherwise, cross-sector, cross-society and cross-economy? If we do not have a cross-sector approach through legislation, how will we enable the clarity, the certainty and the consistency of approach which will bring forward the confidence to enable innovation and investment—good for citizen, good for consumer, good for creative, good for British business and good for our country?

My Lords, I add my thanks to the Minister; it was a pleasure engaging with him over the course of the Bill. He is a Transport Minister who not only knows transport but really cares about it. Can I raise with him the opportunity for an update at this stage? We had a detailed debate about floating bus stops on Report, and from the Dispatch Box he said that the Government would effect a pause in all new floating bus stop schemes. It was very encouraging that the Minister said that, because the Bill does not provide for such a pause. We are a day beyond a month since he made that statement. When he responds, can he give us an update as to what the department has done to bring about that pause in all new floating bus stops? Has the Secretary of State written to local authorities? Will there be a note that goes round? For example, has the department spoken to Streatham to ask it to pause its scheme which it is looking to roll out? I thank again the Minister for his engagement; I would welcome an update on how the department and the Government are looking to put in place provision to enable a pause on all new floating bus stops.

To ask His Majesty’s Government whether they plan to introduce cross-sector legislation on artificial intelligence in 2025.

My Lords, in moving Amendment 4 I will speak also to Amendment 5 in my name. I will be very brief with these because I accept that they go some way beyond the central thrust of the Bill.

My main reason for bringing these amendments back on Report is to make the point, and have it on the record, about the impact of data centres and the fact that they are in many ways the foundries, the furnaces, that are fuelling this fourth industrial revolution, not least when it comes to digital assets but also, of course, when it comes to AI and other new technologies. So it is imperative to think on the implications of, I hope, a massively expanding digital assets ecosystem and economy in this country, and the underlying policy implications for many other government departments.

I also brought the amendment back because, having been told that data centres were not an issue to be brought in the Data (Use and Access) Bill, I thought, well, if not the Data (Use and Access) Bill, why not the Property (Digital Assets etc) Bill? They will continue to be an area of contention rather than consensus, of potential negativity rather than positivity, if all government departments relevant to the issue do not come together and decide what the UK’s data centre strategy is, not least in terms of the provision of that resource for digital assets. If the Government get that right, it should be a purely positive path, but looking at issues around PUE and the siting and fuelling of these data centres is critical.

In brief, Amendment 5 seeks to make it clear that no further regulations will be required in relation to digital assets, stablecoins and other tokenised forms as a consequence of the Bill passing. I beg to move.

My Lords, in moving Amendment 1, in my name, I will speak to Amendments 2 and 3 in this group.

It is a pleasure to open Report of the Property (Digital Assets etc) Bill. In doing so, I declare my technology interests as set out in the register, not least as adviser to Ecospend and Members Capital Management. I take a brief moment to thank all of those who have got the Bill to this stage, including Professor Green and her team at the Law Commission, everyone who was involved with our Special Public Bill Committee—particularly the clerk, Matthew Burton, and all his staff—and all colleagues who have shown an interest in and engaged with the Bill.

There is an extraordinary opportunity when it comes to digital assets and delivering clarity, consistency and certainty around their property classification. By 2030, it is estimated that somewhere between 10% and 14% of GDP will come from digital assets. To put it another way, transactions in 2030 involving digital assets will range between £10 trillion and £24 trillion. That is a huge opportunity for the planet and for the UK, not least because of our excellence in financial services and in fintech—financial technology—but, crucially, because of the great good fortune of English common law.

What we see with the Bill is the leading-edge deployment of that great tradition in the most modern of contexts. To take just one example, if we get effective dematerialisation of the capital markets, that will save £20 billion year-on-year in reduced costs and speeded up transactions. Clarification of digital assets will not only help capital markets but will assist with financial inclusion and financial market infrastructure transformation, impacting positively on our economy and, through that, our society. We should note that the world is watching as we pass this Bill—following, as it does, a suite of Bills from the Law Commission, not least the recent Electronic Trade Documents Bill, now Act.

This is a very good Bill, which does a very simple task of enabling a third category of property: taking a “thing in possession” and a “thing in action” and enabling a potential third category to accommodate digital assets which do not neatly fit within either of those current property classes. It is a good Bill, and it has been through an excellent Committee and Special Public Bill Committee procedure, but I believe it is worthy of stress-test through these amendments this evening.

Amendments 1 and 2 go to the very heart of the Bill and propose that the presumption that digital assets cannot be fitted within the existing two categories of property be reversed. Consider something such as an NFT, a non-fungible token. To put it in simpler terms, it is largely a piece of electronic software on the hardware of a digital ledger. It has an existence beyond its legal form, but it is difficult to possess in the way you would possess, for example, a bag of gold. In that sense, the Bill is structured to enable this third category. The amendment seeks to stress-test that and reverse that presumption, as we have seen in some of the recent judgments in Australia and Singapore.

I am not suggesting that this amendment is the right amendment; it is merely put to stress-test how the Bill is set out. It seeks to stress-test the claim made by Professor Green, when she gave evidence to our Special Public Bill Committee, that this amendment would take the bite out of the Bill. If indeed it would take the bite out of the Bill, then it would not satisfy my three Cs test of what the Bill needs to achieve if we are to realise the opportunities and the economic benefits from digital assets. Those three tests are: clarity, certainty and consistency.

Amendment 3 seeks to assist with this by suggesting codes of practice that could be brought to bear to assist the courts when they come to consider issues around digital assets. With that, I beg to move Amendment 1.

My Lords, I thank all noble Lords who have contributed to this brief debate and say, again, “Job done: mission accomplished”, on the record, I beg leave to withdraw the amendment.

Amendment 4 withdrawn.

Amendment 5 not moved.

In the Title

My Lords, in moving my Amendment 6, I thank the noble Lord, Lord Anderson of Ipswich, and, indeed, the Minister, for adding their names to it. I also take the opportunity again to thank the noble Lord, Lord Anderson of Ipswich, for the excellent job he did in chairing, steering and keeping us focused through our Special Public Bill Committee procedure.

Amendment 6 is incredibly simple and straightforward: it takes the Long Title of the Bill and makes a change so that it fits perfectly with the operative clause within the Bill. As noble Lords will be aware, the Long Title has no operative impact. So, why go to the trouble of making the change? Firstly, for issues of clarity, consistency and certainty—to tidy up the Bill at this stage. But, far more importantly than that, because, as mentioned in earlier groups, the world is watching when we pass this legislation, and the signal that the Bill sends out is critically important. That signal—the signposting—means that, if anyone, anywhere on the planet, merely reads only the Long Title, they will get from that the purpose of the Bill, what it is all about and how it is going about it. It is a simple, straightforward amendment, which I am delighted the Minister has put his name to.

Lastly, as these are almost the last words I will say on the Bill, I will say just two things. We hear very often in these parts about a black hole measured in various billions. What about the opportunities enabled through the Bill for a goldmine? A digital, virtual, intangible goldmine, yes, but a potential digital assets goldmine measured in the trillions. The Property (Digital Assets etc) Bill is future facing, future-proofing, growth enabling ground-breaking and good for innovation, investment, citizen, consumer and the country. I beg to move.

My Lords, I thank all noble Lords who participated in this short debate. I say particularly to my friend, the noble Lord, Lord Clement-Jones: disappointing? Never. The whole purpose of tabling these amendments has been set out eloquently through the debate and what I was seeking to achieve was to have those arguments on the Floor of your Lordships’ House. I am delighted that that is exactly what has occurred, so I am more than happy—not disappointed at all—to withdraw the amendment.

Amendment 1 withdrawn.

Amendments 2 and 3 not moved.

My Lords, I add my thanks to the Minister; it was a pleasure engaging with him over the course of the Bill. He is a Transport Minister who not only knows transport but really cares about it. Can I raise with him the opportunity for an update at this stage? We had a detailed debate about floating bus stops on Report, and from the Dispatch Box he said that the Government would effect a pause in all new floating bus stop schemes. It was very encouraging that the Minister said that, because the Bill does not provide for such a pause. We are a day beyond a month since he made that statement. When he responds, can he give us an update as to what the department has done to bring about that pause in all new floating bus stops? Has the Secretary of State written to local authorities? Will there be a note that goes round? For example, has the department spoken to Streatham to ask it to pause its scheme which it is looking to roll out? I thank again the Minister for his engagement; I would welcome an update on how the department and the Government are looking to put in place provision to enable a pause on all new floating bus stops.