Hayes John: Cluster Munitions (Prohibition) Bill — Procedure Second Reading Third Reading 
Hayes John: Cluster Munitions (Prohibition) Bill — Procedure Second Reading Third Reading 
[Volume:659;Page:8485] 
JOHN HAYES (National—Wairarapa) 
: 
 I think that the Cluster Munitions (Prohibition) Bill is among the most important that we will put through Parliament this year. It was a pleasure to have this issue before our Foreign Affairs Defence and Trade Committee and to have members from all parties totally united in preparing the report back to the House. I am just looking back through  
Hansard 
 and I notice that the bill first came to our attention in late July of this year so in parliamentary terms we have done quite well. I commend the Minister for Disarmament and Arms Control Georgina te Heuheu for pushing so hard to make sure that we got the legislation through in this calendar year. I should also like to commend the Leader of the Opposition Phil Goff for his stewardship of this issue in his term in Government and my colleague Don MacKay in the ministry who was our lead negotiator on the legislation. 
There are a couple of points in the report back to the House that I would like to quickly address—on issues that had caused the committee to make some recommendations. One of the issues was that we were concerned that the application of the bill could inadvertently criminalise New Zealanders who work for humanitarian or commercial organisations that legitimately work to clear the sites of cluster munitions in other countries. We understand that this was not the intent of the bill and we recommended amending clause 12 by making it very clear that people engaged in this work did not commit an offence when they undertook cluster munitions clearance activities in a way that was in accordance with the convention. 
The second area that caused the committee a lot of deliberation over a period of several weeks was the question of investment in a company engaged in the manufacture of cluster munitions or in one that had some other involvement in cluster munitions production although in some cases that may not have been the primary focus of the activities of those companies and investors may not be aware that such activities were part of the business. An example of that would be Lockheed Martin. In 2008 the New Zealand Superannuation Fund for example divested from Lockheed Martin as part of its exclusion of cluster munitions - involved companies from its investment portfolio. 
The wording of the offence is not directed at investors who unknowingly find themselves with an investment in a company involved in cluster munitions production but there would however be a reasonable expectation that fund managers and investors would investigate the full portfolio of a company before investing in case prohibited activities were involved. Under clause 11(1A) a person can be convicted of an offence but only if that person had made the investment intending that it would result in cluster munitions development or production or knowing it would do so. For the average investor the mental element would have to be clearly established—that is the investor invested in that company knowing that it developed or produced cluster munitions. That provision may also be interpreted by the courts to include retaining an investment after the discovery of its involvement in cluster munitions development or production. Because of the extraterritorial provision of the bill both domestic and offshore investment is covered. 
With those few comments I commend this legislation to the House. I particularly thank Jacqui Dean who chaired the committee for a period of several weeks in my absence. I also thank all my colleagues on the committee for the great work they did in preparing this report and bringing it back to the House. Thank you.