House of Commons Amendments

Session 2012 - 13
Internet Publications
Other Bills before Parliament

Public Bill Committee: 17 July 2012
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Enterprise and Regulatory Reform Bill, continued

(5)
References in this Chapter to the making of a remuneration payment or

to the making of a payment for loss of office are to be read in accordance

with this section.

(6)
References in this Chapter to a payment by a company include a payment

by another person at the direction of, or on behalf of, the company.

(7)
References in this Chapter to a payment to a person (“B”) who is, has

been or is to be a director of a company include—

(a)
a payment to a person connected with B, or

(b)
a payment to a person at the direction of, or for the benefit of, B

or a person connected with B.

(8)
Section 252 applies for the purposes of determining whether a person is

connected with a person who has been, or is to be, a director of a

company as it applies for the purposes of determining whether a person

is connected with a director.

(9)
References in this Chapter to a director include a shadow director but

references to loss of office as a director do not include loss of a person’s

status as a shadow director.

Restrictions relating to remuneration or loss of office payments

226B
Remuneration payments

(1)
A quoted company may not make a remuneration payment to a person

who is, or is to be, a director of the company unless—

(a)
the payment is consistent with the approved directors’

remuneration policy, or

(b)
the payment is approved by resolution of the members of the

company.

(2)
The approved directors’ remuneration policy is the most recent

remuneration policy to have been approved by a resolution passed by the

members of the company in general meeting.

226C
Loss of office payments

(1)
No payment for loss of office may be made by any person to a person

who is, or has been, a director of a quoted company unless—

(a)
the payment is consistent with the approved directors’

remuneration policy, or

(b)
the payment is approved by resolution of the members of the

company.

(2)
The approved directors’ remuneration policy is the most recent

remuneration policy to have been approved by a resolution passed by the

members of the company in general meeting.

226D
Sections 226B and 226C: supplementary

(1)
A resolution approving a payment for the purposes of section 226B(1)(b)

or 226C(1)(b) must not be passed unless a memorandum setting out

particulars of the proposed payment (including its amount) is made

available for inspection by the members of the company—

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Enterprise and Regulatory Reform Bill, continued

(a)
at the company’s registered office for not less than 15 days

ending with the date of the meeting at which the resolution is to

be considered, and

(b)
at that meeting itself.

(2)
The memorandum must explain the ways in which the payment is

inconsistent with the approved directors’ remuneration policy (within the

meaning of the section in question).

(3)
The company must ensure that the memorandum is made available on the

company’s website from the first day on which the memorandum is made

available for inspection under subsection (1) until its next accounts

meeting.

(4)
Failure to comply with subsection (3) does not affect the validity of the

meeting at which a resolution is passed approving a payment to which the

memorandum relates or the validity of anything done at the meeting.

(5)
Nothing in section 226B or 226C authorises the making of a

remuneration payment or payment for loss of office in contravention of

the articles of the company concerned.

(6)
In this section the “company’s website” is the website on which the

company makes material available under section 430.

226E
Payments made without approval: civil consequences

(1)
An obligation (however arising) to make a payment which would be in

contravention of section 226B or 226C has no effect.

(2)
Subject to subsections (3) and (4), if a payment is made in contravention

of section 226B or 226C—

(a)
it is held by the recipient on trust for the company or other person

making the payment, and

(b)
in the case of a payment by a company, any director who

authorised the payment is jointly and severally liable to

indemnify the company that made the payment for any loss

resulting from it.

(3)
If a payment for loss of office is made in contravention of section 226C

to a director of a quoted company in connection with the transfer of the

whole or any part of the undertaking or property of the company or a

subsidiary of the company, it is held by the recipient on trust for the

company whose undertaking or property is or is proposed to be

transferred.

(4)
If a payment for loss of office is made in contravention of section 226C

to a director of a quoted company in connection with a transfer of shares

in the company, or in a subsidiary of the company, resulting from a

takeover bid—

(a)
it is held by the recipient on trust for persons who have sold their

shares as a result of the offer made, and

(b)
the expenses incurred by the recipient in distributing that sum

amongst those persons shall be borne by the recipient and not

retained out of that sum.

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Enterprise and Regulatory Reform Bill, continued

226F
Relationship with requirements under Chapter 4

(1)
This Chapter does not affect any requirement for approval by a resolution

of the members of a company which applies in relation to the company

under Chapter 4.

(2)
Where the making of a payment to which section 226B or 226C applies

requires approval by a resolution of the members of the company

concerned under Chapter 4, approval obtained for the purposes of that

Chapter is to be treated as satisfying the requirements of section

226B(1)(b) or (as the case may be) 226C(1)(b).”.’.

Payments to directors: minor and consequential amendments

Norman Lamb

NC7

To move the following Clause:—

‘(1)
The Companies Act 2006 is amended as follows.

(2)
In section 180 (consent, approval or authorisation by members)—

(a)
in subsection (2), in the words before paragraph (a)—

(i)
after “Chapter 4” insert “or 4A”, and

(ii)
for “that Chapter” substitute “either of those Chapters”,

(b)
in that subsection, in paragraph (a), for “that Chapter” substitute “the

Chapter concerned”, and

(c)
in subsection (3), after “Chapter 4” insert “or 4A”.

(3)
In section 190 (substantial property transactions: requirement of members’

approval), in subsection (6)(b), for the words in brackets substitute “(payments to

which the requirements of Chapter 4 or 4A apply)”.

(4)
In section 215 (payments for loss of office), after subsection (4) insert—

“(5)
Nothing in this section or sections 216 to 222 applies in relation to a

payment for loss of office to a director of a quoted company.”

(5)
Section 430 (quoted companies: annual accounts and reports to be made available

on website) is amended as follows.

(6)
After subsection (2) insert—

“(2A)
If the directors’ remuneration policy of a quoted company is revised in

accordance with section 422A, the company must ensure that the revised

policy is made available on the website on which its annual accounts and

reports are made available.

(2B)
If a person ceases to be a director of a quoted company, the company

must ensure that the following information is made available on the

website on which its annual accounts and reports are made available—

(a)
the name of the person concerned, and

(b)
particulars of any payment for loss of office (within the meaning

of Chapter 4A of Part 10) made to the person, including its

amount and how it was calculated.”

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(7)
In subsection (3) —

(a)
for “the annual accounts and reports on the website” substitute “the

material made available on the website under subsections (1) to (2B)”,

and

(b)
for “the annual accounts and reports from” substitute “such material

from”.

(8)
After subsection (4) insert—

“(4A)
Where subsection (2A) or (2B) applies, the material in question—

(a)
must be made available as soon as reasonably practicable, and

(b)
must be kept available until the next directors’ remuneration

report of the company is made available on the website.”

(9)
In subsection (5)—

(a)
in the words before paragraph (a), for the words from “the annual

accounts and reports” to “that period” substitute “material available on a

website throughout the period mentioned in subsection (4) or (as the case

may be) (4A)”, and

(b)
in paragraph (a) for “the annual accounts and reports are” substitute “the

material is”.

(10)
In section 440 (quoted companies: offences in connection with procedure for

approval)—

(a)
in subsection (1) —

(i)
after “section 439(1)” insert “or 439A(1) or (2)”, and

(ii)
in the words in brackets, after “report” insert “or policy”,

(b)
in subsection (2), for “the accounts meeting” substitute “the meeting to

which it relates”, and

(c)
in subsection (5), omit the definition of “the accounts meeting”.

(11)
In Schedule 8 (in the index of defined expressions), at the appropriate places

insert—

“directors’
section 226A(1)”

remuneration policy

(in Chapter 4A of

Part 10)

“payment for loss of
section 226A(1)”

office (in Chapter 4A

of Part 10)

“remuneration
section 226A(1)”.’.

payment (in Chapter

4A of Part 10)

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Enterprise and Regulatory Reform Bill, continued

Directors’ remuneration reports and payments to directors: transitional provision

Norman Lamb

NC8

To move the following Clause:—

‘(1)
Subsection (2) of section 439A of the Companies Act 2006 (as inserted by section

(Payments to directors: members’ approval of directors’ remuneration policy)(4)

of this Act) does not apply in relation to a company prior to the holding of the

meeting mentioned in subsection (1)(a) of that section of that Act of 2006.

(2)
Chapter 4A of Part 10 of the Companies Act 2006 (as inserted by section

(Payments to directors of quoted companies)) does not apply in relation to

remuneration payments or payments for loss of office made by a company before

the earlier of—

(a)
the end of the first financial year of the company to begin after the

coming into force of that section of this Act, and

(b)
the date from which the first directors’ remuneration policy to be

approved under section 439A of the Companies Act 2006 (as inserted by

section (Payments to directors: members’ approval of directors’

remuneration policy)(4) of this Act) takes effect.

(3)
Chapter 4A of Part 10 of the Companies Act 2006 does not apply in relation to

remuneration payments or payments for loss of office that are required to be made

under an agreement entered into before 27 June 2012 or in consequence of any

other obligation arising before that date.

(4)
An agreement entered into, or any other obligation arising, before 27 June 2012

that is modified or renewed on or after that date is to be treated for the purposes

of subsection (3) as having been entered into or (as the case may be) as having

arisen on the date on which it was modified or renewed.

(5)
The amendment made by section (Payments to directors: minor and

consequential amendments)(4) does not apply in relation to a payment for loss of

office to which subsection (2) or (3) of this section applies.’.

Power to reduce duration of copyright in transitional cases

Norman Lamb

NC11

To move the following Clause:—

‘(1)
Section 170 of the Copyright, Designs and Patents Act 1988 (transitional

provisions and savings) is amended as follows.

(2)
At the beginning insert “(1)”.

(3)
At the end insert—

“(2)
The Secretary of State may by regulations amend Schedule 1 to reduce

the duration of copyright in existing works which are—

(a)
unpublished, or

(b)
published but anonymous or pseudonymous.

(3)
The regulations may provide for the copyright to expire on the

commencement of the regulations or at any later time.

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Enterprise and Regulatory Reform Bill, continued

(4)
“Existing works” has the same meaning as in Schedule 1.

(5)
Regulations under subsection (2) may—

(a)
make supplementary or transitional provision;

(b)
make consequential provision, including provision amending

any enactment or subordinate legislation passed or made before

that subsection comes into force.

(6)
The power to make regulations under subsection (2) is exercisable by

statutory instrument.

(7)
A statutory instrument containing regulations under subsection (2) may

not be made unless a draft of the instrument has been laid before and

approved by resolution of each House of Parliament.” ’.

Penalties under provision implementing Directive on term of protection

Norman Lamb

NC12

To move the following Clause:—

‘Paragraph 1(1)(d) of Schedule 2 to the European Communities Act 1972

(limitation on criminal penalties) does not apply for the purposes of provision

under section 2(2) of that Act implementing Directive 2011/77/EU amending

Directive 2006/116/EC on the term of protection of copyright and certain related
5
rights.’.

As an Amendment to Norman Lamb’s proposed New Clause (Penalties under

provision implementing Directive on term of protection) (NC12):—

Mr Iain Wright

Ian Murray

Chi Onwurah

(a)

Line  3,  leave out from ‘implementing’ to end and insert ‘acts which may be done

in relation to copyright works notwithstanding the subsistence of copyright.’.

Licensing of copyright and performers’ rights

Norman Lamb

NC13

To move the following Clause:—

‘(1)
The Copyright, Designs and Patents Act 1988 is amended as follows.

(2)
In section 116 (licensing schemes and licensing bodies) after subsection (4)

insert—



© Parliamentary copyright	Revised 17 July 2012