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There has been a 12-week consultation that speaks to existing PDR being enhanced. Local authorities can, subject to confirmation by ministers, use an article 4 process through the general permitted development order, which can restrict or exempt particular areas from permitted development rights. That addresses some of the other points that have been raised. It is important to put that on the record, because, beyond the other consenting regimes to which I referred, in extremis, if a local authority deems it required because of unintended consequences, there is a means under the existing provisions, subject to ministerial confirmation, to exempt a particular area from permitted development rights.

Tom, it would help if you could go over what the proposed PDR do specifically in relation to EV charging infrastructure.

Amendment 1 is a technical amendment that relates to the possibility that there could be competing assignation documents in relation to the same claim. In most cases, the claim would transfer to whichever assignee first benefited from intimation or registration of the assignation document, because that will usually be the final requirement to be met under section 3(2) and so will give rise to the transfer. However, in some cases, it might not be the final requirement to be satisfied.

Amendment 1 deals with the scenario in which the final requirement to be met is the claim becoming identifiable. That might happen if it is a future claim. Amendment 1 provides that, if the final requirement for transfer is met when the claim becomes identifiable as one that is covered by the assignation, the claim transfers to the person who first benefited from registration or intimation in their favour.

Although it should be very unusual for the same claim to be assigned by one person to different people, amendment 1 would ensure clarity by breaking what would otherwise have been a tie. It would also ensure that section 3(5)(c) deals consistently with all the possible ways in which a tie could arise.

Amendments 2 and 3 are technical amendments that relate to the possibility that a claim might be assigned in whole or in part. Although assignation in part is likely to be rare, it is still important that a suitable provision is made for it.

Amendment 2 would have two effects. First, it would provide that what matters is whether it is likely that assignation will make the obligation more burdensome on a debtor, and the question whether the claim can be assigned in part will therefore be assessed when the assignation is made, rather than it potentially appearing to be valid at the time but becoming challengeable when unforeseen events occur later.

Secondly, at the moment, section 5 provides that the requirement for a claim to be divisible in order to be partially assigned applies only where the debtor does not consent to partial assignation. However, a claim that is not divisible cannot be assigned in part. Amendment 2 therefore makes it clear that the requirement for divisibility applies whether or not the debtor consents.

Amendment 3 provides that an agreement about any expense that is attributable as a result of a claim being assigned in part rather than as a whole may be made with the assigner or with the person who was a holder of the claim at the time of agreeing it. That simply recognises that an agreement with a previous holder is valid and that matters do not have to be renegotiated every time that the holder changes.

On amendment 9, it has been suggested that it should be competent to register an assignation document that assigns different claims to different people. The intention would be to restrict the associated application for registration to only the claims that are relevant to the particular assignee in question, and amendment 9 would provide for that.

Amendment 12 would remove section 38, which would disapply the Transmission of Moveable Property (Scotland) Act 1862 in relation to assignations to which part 1 of the bill applies. It would replace it with a section that would repeal the 1862 act in its entirety. That is because, following discussions with the SLC advisory group, we have satisfied ourselves that there is no purpose for which we would want to preserve the 1862 act, even if assignations of financial collateral arrangements were not brought into the bill by a section 104 order, as we expect them to be.

On amendment 61, in the name of Mr Balfour, I understand that the Law Society of Scotland believes that the question of how long a notice should take to be deemed to have arrived ought to be subject to a determination as to the method of service under section 8(6). Our understanding is that amendment 61 is intended to achieve that; unfortunately, however, it does not work and is unnecessary. If someone tries to intimate using a method of service that is not allowed under a determination entered into by the parties, it will not, under section 8(6)(a), be a valid intimation. As such, it is irrelevant when the notice is taken to arrive under section 8(9), because it will not achieve anything.

If someone tries to intimate by post in a case where a particular postal address has been agreed between the parties under the determination, intimation to a different address will be invalid, because of section 8(5)(b). Again, it will be irrelevant when the notice to the wrong address is taken to arrive, because it will not achieve anything.

If someone intimates by post to the address that has been agreed between the parties under the determination, the rule on when it is deemed to arrive under section 8(9) already applies. Indeed, section 8(9)(a) includes an express reference to the fact that the relevant address might have been modified by the parties under subsection (6)(b). Amendment 61 is therefore unnecessary and will simply confuse matters, and I ask Mr Balfour not to move it.

Mr Balfour’s amendment 65, which was also suggested by the Law Society, would mean that those acting in the place of assignees such as trustees and agents would be included in the definition of “assignee”. The Government does not believe that that is necessary. Legislation does not normally deal expressly with trustees and agents, given that the general law deals suitably with such aspects, and it would be cumbersome always to have to mention every possible representative capacity in which a person could act. In this case, however, we already have a provision under section 116(2) that explicitly provides that someone who is required to do a thing can have someone else do it for them. I therefore ask Mr Balfour not to move this amendment on the basis that it is unnecessary.

I move amendment 1.

Amendments 62 and 63, in the name of Jeremy Balfour, were included in the written evidence from the Law Society of Scotland to the committee during stage 1 of the bill. I understand that the Law Society’s view was that, if the assignee can demonstrate that the processes for intimation have been complied with, the onus should be on the debtor to demonstrate that they were acting in good faith.

The amendments remove protection for a debtor who would have been able to rely on the provisions in section 10. Under the current law, a claim would transfer only if the assignation was intimated to the debtor. However, the effect of the changes in the bill is to extend the scope of intimation and to enable registration as a method of effecting the transfer of a claim. That being the case, the debtor might not know that a claim has been assigned and might in good faith pay an assignor who is no longer the creditor. The onus is placed on the person making the assertion that a debtor has performed other than in good faith. Whether or not a debtor has performed in good faith will depend on the facts of the case.

It is my view that the amendments do not take into account the extension to the scope of intimation and that, in reversing the burden of proof, the amendments would be unfair to the debtor. How could a debtor prove a negative? That is in effect what a debtor would be required to do if they had not, in fact, received notification, even though they might be deemed to have done so. The person intimating the assignation could choose to do so in a way that allows for delivery to be recorded, and therefore gives evidence of delivery, whereas the debtor would have no control over that. For that reason, I ask the member to withdraw amendment 62 and not to move amendment 63.

The new section that is introduced by amendment 4 would provide further protection for a debtor performing in good faith, both where the debtor is unaware of a condition pertaining to the assignation of a claim and where the debtor is aware of the condition but mistakenly thinks that it has been met and performs to the assignee. The claim will not have transferred because the condition has not been satisfied, but, in the circumstances that I have described, which mean that the debtor performs to the assignee, the debtor will be discharged from the claim to the extent of that performance because they will have acted in good faith.

Section 14 applies where notice of an assignation document has been given to a debtor by the assignee, rather than by the assignor. It has the effect that the debtor may request from the assignee reasonable evidence of the assignation document having been granted. Where an assignation document has been granted, the debtor will be entitled to withhold performance from each of the assignor and the assignee until the evidence is provided by the assignee. Where an assignation document has not been granted, the debtor will be entitled to withhold performance until either the purported assignee, or the purported assignor, confirms in writing that an assignation document has not been granted in respect of the claim.

Section 14 also allows a debtor who has not received intimation of an assignation but becomes aware that an assignation document may have been granted, to ask a purported assignor to confirm whether that is the case, and to withhold performance until they receive that confirmation.

Amendment 8 makes it clear that, if the debtor is a co-debtor, and if only one co-debtor makes a request for information, the protection that is given by section 14 to withhold information until the evidence is provided is available only to the co-debtor who made the request and not to other co-debtors. The other co-debtors are likely to be unaware of the request for information, so it follows that their obligation should not also be suspended.

Section 105 makes it clear that a person entered into the register as the secured creditor in respect of a statutory pledge should be obliged to respond to a request for certain information about that pledge. Section 105(1)(a) sets out that the information to be provided in response to a request will vary, depending on the facts. If the person is the secured creditor, they can be asked, first, to specify whether property specified in the request is encumbered property and, secondly, to describe the secured obligation. If the person registered as a creditor is no longer or has never been the secured creditor, they must provide information to that effect and, if relevant, details of the person to whom they assigned the pledge and any further known details of subsequent assignees.

Section 105(1)(a)(ii) provides that the secured creditor should also provide a description of the secured obligation. However, the committee has received representations to the effect that it is not clear why a secured creditor should disclose the nature or extent of the secured obligation to anyone other than the provider of the pledge, who will have that information anyway. We understand that that disclosure requirement does not arise in relation to other types of security interest, so it is felt that there ought to be a limit to what information an entitled person should be permitted to obtain, pursuant to section 105, given that they will obtain confirmation of whether the relevant property comprises encumbered property under section 105(1)(a)(i), which is what should be important.

The deletion of section 105(1)(a)(ii), as provided under amendment 32, will remove the requirement to provide details of the secured obligation. Amendments 31 and 33 are consequential on that change.

Amendments 10 and 34 deal with a different aspect of information requests. If an entitled person does not receive a response to a request for information about a statutory pledge, they can apply to the court in respect of that failure under section 105(6). Amendment 34 simply permits a court to stipulate a period other than 14 days to require a secured creditor to respond to a request for information under a court order, although 14 days will remain the default period.

Amendment 10 makes a similar change in relation to section 34, under which an entitled person may ask a person identified in the assignations record as the assignee for information on whether a claim has been assigned or whether a condition has been satisfied. If the request is not complied with, the court may order a response.

I move amendment 10.

Amendment 10 agreed to.

Section 34, as amended, agreed to.

Section 35—Liability of Keeper

I have nothing further to add.

Amendment 13 agreed to.

Section 42, as amended, agreed to.

Section 43—Constitutive document

I recognise the point that Mr Balfour makes and the original intention behind Ms Mochan’s amendment. The Government has regular dialogue with a range of business representative organisations, and there is regular dialogue and engagement at ministerial level, so should any issues arise, there would be an opportunity in the first instance for that direct communication to the Government and, as a consequence of that direct engagement, the Government could consider whether any review or further action was required.

Beyond that, Parliament has a very important role to play. All ministers are accountable to Parliament and are subject to questions by other parliamentarians and by committees. Should concerns arise, there are avenues through direct engagement with the Government from representative organisations or through the activities of parliamentarians holding the Government to account for concerns to be flagged and for any review to be undertaken. I add that it would not be only for the Government to have that opportunity, should it be required; Parliament, at any time and in any capacity, via committees or otherwise, can choose to instigate a review of any piece of legislation. That is routine and good practice.

In light of the continued close engagement that takes place between the Government and business and the fact that ministers and the Government are held to account by Parliament, which provides an opportunity for questions and updates on how the provisions of the bill operate in practice, I ask Ms Mochan not to press her amendments.

The Government amendments are intended to respond to criticism of the effect of section 13 from stakeholders and practitioners in the field in relation to rights of compensation and other similar rights that the debtor may have against the assignor. Amendments 5, 6 and 7 respond to concerns of members of the Scottish Law Commission’s advisory group on moveable transactions that relate to the impact of the provision on compensation, set-off, retention, balancing of accounts or counterclaims, rather than on defences.

Amendments 5 and 6 remove wording that it was considered might not exactly replicate the existing common-law rule whereby a debtor can, after the claim is assigned, assert a right of compensation, set-off and so on that the debtor had against the assignor against the assignee.

Those provisions are replaced by amendment 7, which is intended to preserve the current position, in which notice of the assignation is intimated but has the effect of ensuring that the registration of an assignation is not to be treated in the same way as intimation. Whereas giving notice of intimation of the assignation would have the effect that subsequent dealings between the assignor and the debtor would not be included in any calculation of compensation and so on that the debtor could not assert against the assignee, registration is not to have that effect, unless accompanied by other actings, which would be treated as notice to the debtor that the claim had been assigned.

Given the progress that we are making with a section 104 order, which will ultimately ensure that the bill achieves the effect that the SLC intended for it to achieve, and given that we look for those provisions to come into effect when the registers go live, the approach that we have set out in the bill is sufficient to meet the SLC’s objectives.

I recognise that there is a keen interest in ensuring that the provisions come online and understand the desire to seek any compromise options. However, given that the registers will—we hope—commence next summer, subject to Parliament agreeing to the bill at stage 3, I ask Jeremy Balfour not to press the amendments.

As the committee is aware, the bill makes it possible for intimation to take place by means of registration of the assignation document in a new register of assignations. That is intended to address concerns about the current system being expensive and cumbersome due to the need to intimate to all debtors, and about the inability to deal with future claims and debtors.

There is a misconception that, currently, in a bulk assignation of consumer debt, assignations are intimated to debtors and that the bill will remove the need to intimate to such debtors. In fact, the committee has heard evidence that, due to the various workarounds—such as using English law—that have been put in place to, in effect, circumvent the difficulties with the current system, debtors are currently not being notified. That is not problematic because either the parties are happy for the debtor to continue to pay the original person or there is protection for debtors who do not know to pay the new person in cases in which the payment right ought to have transferred across.

It is therefore difficult to see how amendment 52 would work in practice, as it is based on a misunderstanding that, currently, such intimation routinely takes place. In particular, the amendment refers to

“the removal of the need”

to intimate to debtors. As I have just mentioned, that ignores the fact that, at present, in a bulk assignation of consumer debt, debtors are commonly not notified due to the various workarounds.

Amendment 11 amends section 35 so that failure of the keeper’s search system in relation to the assignations record and the register of assignations will be added to the list of scenarios in which the keeper will be liable to pay compensation for any loss that is suffered as a result of a failure to identify the assignor correctly. The issue applies equally to the register of statutory pledges, so amendment 35 makes a similar amendment to section 107 in relation to when a search fails to correctly disclose the provider of a statutory pledge.

I want to be clear that the amendments do not relate to wrong information being submitted by the applicant or entered into the register by Registers of Scotland. Rather, they cover situations in which the register is correct but the search engine malfunctions and does not disclose information that is sought correctly. In those circumstances, the keeper should be liable if a searcher suffers loss as a result of that failure.

I move amendment 11.

Amendment 11 agreed to.

Section 35, as amended, agreed to.

Sections 36 and 37 agreed to.

Section 38—Disapplication of Transmission of Moveable Property (Scotland) Act 1862 to assignations to which this Part applies

Amendment 12 moved—[Tom Arthur]—and agreed to.

Section 38, as amended, agreed to.

After section 38

The provision is to introduce a new register of assignations, which is about simplifying the existing process. At the moment, we have a de facto process whereby intimation is not taking place, which requires complex workarounds. The introduction of a register of assignations will mean that those complex workarounds will no longer be required, so intimation will still be an available option. Intimation is not, as amendment 52 suggests, being removed. It is not the reality that intimation routinely takes place when the workarounds are already in place.

In my view, the amendment reflects a misunderstanding of the reality of the current situation, which is that the workarounds are being used regularly. Among other things, the bill seeks to ensure that, rather than having to use those complex workarounds in Scotland, we will have access to the new register of assignations, which will help to simplify the process.

As I set out in my letter to the committee earlier this month, when I met a range of consumers and money advice representatives to discuss stage 2 amendments, their view was that nothing more was needed in relation to consumers and the assignation of debt. In the event that their view were to change in the future, we would, of course, engage with them on that. However, the prescriptive nature of a predetermined review would not lend itself well to that.

I hope that that reassurance aids the committee’s understanding that amendment 52 is not needed, and I ask that it not be pressed.