Cardinal Vincent Nichols, Archbishop of Westminster, said the "optics are difficult to understand... for the man in the street" but said the Holy See was following diplomatic procedures.
Brian Altman QC, counsel to the Independent Inquiry into Child Sexual Abuse (IICSA), said the Holy See had not provided information about the delays in the laicisation - or defrocking - of some paedophile priests.
He cited the example of James Robinson, a West Midlands-based priest who was convicted in 2010 of 21 child sex offences - the laicisation documents were sent to Rome in 2010 and again in 2015 but it was only finalised in February last year.
Mr Altman said the inquiry has been told that the Holy See considers "the domestic laws and internal proceedings of a foreign, sovereign entity are not the proper object for a British inquiry".
He asked the cardinal whether he agreed the apparent delays were a "matter of legitimate concern", and the witness said he did, adding he thought mistakes were made in the original defrocking application.
Cardinal Nichols said: "Beyond that, I cannot go very far, I am not a diplomat and I do not understand the niceties of international law in these things.
"I was given the impression a very focused request could receive a reply but it had to be not a generalised request but a particularly focused request."
Mr Altman asked whether that would appear "unfortunate" as it would give the impression "rightly or wrongly that the Holy See is closing shop".
Cardinal Nichols replied: "I think it is a statement of diplomatic law.
"The optics are difficult to understand from this perspective, and for the man in the street."
Earlier, he said that the church has been "shocked to the core" by the presence of evil among its members.
Speaking of lessons he learned from attending a worldwide summit held for senior Roman Catholic bishops on tackling the global problem, he told the hearing he attended the conference in Rome in February, along with around 200 other delegates.
Cardinal Nichols said: "I think we should do more in the general life of our parishes to set the task of safeguarding in a more positive context.
"I think the experience in the Catholic community in this country over the last 20 years has been one of struggling to cope with the presence of evil embodied in its members, which has shocked it to the core."
He added: "I think getting the task of safeguarding understood in an utterly positive way is something we still have to achieve."
Mr Altman asked if the cardinal believed there was still much to improve in 2019, despite major inquiries held in 2001 and 2007.
The 73-year-old replied: "I do think there's plenty to be achieved.
"I would affirm absolutely that the culture of the Catholic Church today is radically different from 2001 or even 2007, but I do think there's much, much more to achieve."
Mr Altman asked: "Do you accept the general proposition that the wheels turn rather slowly in the Catholic Church in England and Wales?"
The cardinal replied: "I would be reluctant to accept that. I do think we have a rhythm of work.
"This is not a top-down organisation, we have to work by consent. I think we do reasonably well."
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