Enterprise and Regulatory Reform Bill

Session 2012 - 13
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Other Bills before Parliament

Enterprise and Regulatory Reform Bill

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Part 6 — Miscellaneous and general
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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—
5
(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
10
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
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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.
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(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.
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Supplementary
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
30
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
35
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
40
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
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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
5
amongst those persons shall be borne by the recipient and not
retained out of that sum.
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
10
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
15
226B(1)(b) or (as the case may be) 226C(1)(b).”
73
Payments to directors: minor and consequential amendments
(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)—
20
(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”.
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(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
30
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
35
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
40
website on which its annual accounts and reports are made available—
(a)
the name of the person concerned,
(b)
particulars of any remuneration payment (within the meaning
of Chapter 4A of Part 10) made or to be made to the person after

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ceasing to be a director, including its amount and how it was
calculated, and
(c)
particulars of any payment for loss of office (within the meaning
of that Chapter) made or to be made to the person, including its
amount and how it was calculated.”
5
(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
10
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
15
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
20
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)—
25
(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
30
(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

35

policy (in Chapter

4A of Part 10)

“payment for loss
section 226A(1)”

of office (in

Chapter 4A of Part

40

10)

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“remuneration
section 226A(1)”.

payment (in

Chapter 4A of Part

10)

(12)
In that Schedule, after “quoted company”, insert—
5

“—in Chapter 4A of Part 10
section 226A(1)”.

74
Payments to directors: supplemental
(1)
Subsection (2) of section 439A of the Companies Act 2006 (as inserted by
section 71(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
10
of 2006.
(2)
Chapter 4A of Part 10 of the Companies Act 2006 (as inserted by section 72)
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 on or after the
15
day on which that section of this Act comes into force, 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 71(4) of this Act) takes effect.
(3)
Chapter 4A of Part 10 of the Companies Act 2006 does not apply in relation to
20
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
25
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 73(4) does not apply in relation to a payment
for loss of office to which subsection (2) or (3) of this section applies.
Supply of customer data
30
75
Supply of customer data
(1)
The Secretary of State may by regulations require a regulated person to
provide customer data—
(a)
to a customer, at the customer’s request;
(b)
to a person who is authorised by a customer to receive the data, at the
35
customer’s request or, if the regulations so provide, at the authorised
person’s request.
(2)
“Regulated person” means—

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(a)
a person who, in the course of a business, supplies gas or electricity to
any premises;
(b)
a person who, in the course of a business, provides a mobile phone
service;
(c)
a person who, in the course of a business, provides financial services
5
consisting of the provision of current account or credit card facilities;
(d)
any other person who, in the course of a business, supplies or provides
goods or services of a description specified in the regulations.
(3)
“Customer data” means information which—
(a)
is held in electronic form by or on behalf of the regulated person, and
10
(b)
relates to transactions between the regulated person and the customer.
(4)
Regulations under subsection (1) may make provision as to the form in which
customer data is to be provided and when it is to be provided (and any such
provision may differ depending on the form in which a request for the data is
made).
15
(5)
Regulations under subsection (1)—
(a)
may authorise the making of charges by a regulated person for
complying with requests for customer data, and
(b)
if they do so, must provide that the amount of any such charge—
(i)
is to be determined by the regulated person, but
20
(ii)
may not exceed the cost to that person of complying with the
request.
(6)
Regulations under subsection (1)(b) may provide that the requirement applies
only if the authorised person satisfies any conditions specified in the
regulations.
25
(7)
In deciding whether to specify a description of goods or services for the
purposes of subsection (2)(d), the Secretary of State must (among other things)
have regard to the following—
(a)
the typical duration of the period during which transactions between
suppliers or providers of the goods or services and their customers take
30
place;
(b)
the typical volume and frequency of the transactions;
(c)
the typical significance for customers of the costs incurred by them
through the transactions;
(d)
the effect that specifying the goods or services might have on the ability
35
of customers to make an informed choice about which supplier or
provider of the goods or services, or which particular goods or services,
to use;
(e)
the effect that specifying the goods or services might have on
competition between suppliers or providers of the goods or services.
40
(8)
The power to make regulations under this section may be exercised—
(a)
so as to make provision generally, only in relation to particular
descriptions of regulated persons, customers or customer data or only
in relation to England, Wales, Scotland or Northern Ireland;
(b)
so as to make different provision for different descriptions of regulated
45
persons, customers or customer data;
(c)
so as to make different provision in relation to England, Wales,
Scotland and Northern Ireland;

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(d)
so as to provide for exceptions or exemptions from any requirement
imposed by the regulations, including doing so by reference to the costs
to the regulated person of complying with the requirement (whether
generally or in particular cases).
(9)
For the purposes of this section, a person (“C”) is a customer of another person
5
(“R”) if—
(a)
C has at any time, including a time before the commencement of this
section, purchased (whether for the use of C or another person) goods
or services supplied or provided by R or received such goods or
services free of charge, and
10
(b)
the purchase or receipt occurred—
(i)
otherwise than in the course of a business, or
(ii)
in the course of a business of a description specified in the
regulations.
(10)
In this section, “mobile phone service” means an electronic communications
15
service which is provided wholly or mainly so as to be available to members of
the public for the purpose of communicating with others, or accessing data, by
mobile phone.
76
Supply of customer data: enforcement
(1)
Regulations may make provision for the enforcement of regulations under
20
section 75 (“customer data regulations”) by the Information Commissioner or
any other person specified in the regulations (and, in this section, “enforcer”
means a person on whom functions of enforcement are conferred by the
regulations).
(2)
The provision that may be made under subsection (1) includes provision—
25
(a)
for applications for orders requiring compliance with the customer
data regulations to be made by an enforcer to a court or tribunal;
(b)
for notices requiring compliance with the customer data regulations to
be issued by an enforcer and for the enforcement of such notices
(including provision for their enforcement as if they were orders of a
30
court or tribunal).
(3)
The provision that may be made under subsection (1) also includes provision—
(a)
as to the powers of an enforcer for the purposes of investigating
whether there has been, or is likely to be, a breach of the customer data
regulations or of orders or notices of a kind mentioned in subsection
35
(2)(a) or (b) (which may include powers to require the provision of
information and powers of entry, search, inspection and seizure);
(b)
for the enforcement of requirements imposed by an enforcer in the
exercise of such powers (which may include provision comparable to
any provision that is, or could be, included in the regulations for the
40
purposes of enforcing the customer data regulations).
(4)
Regulations under subsection (1) may—
(a)
require an enforcer (if not the Information Commissioner) to inform the
Information Commissioner if the enforcer intends to exercise functions
under the regulations in a particular case;
45
(b)
provide for functions under the regulations to be exercisable by more
than one enforcer (whether concurrently or jointly);

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(c)
where such functions are exercisable concurrently by more than one
enforcer—
(i)
designate one of the enforcers as the lead enforcer;
(ii)
require the other enforcers to consult the lead enforcer before
exercising the functions in a particular case;
5
(iii)
authorise the lead enforcer to give directions as to which of the
enforcers is to exercise the functions in a particular case.
(5)
Regulations may make provision for applications for orders requiring
compliance with the customer data regulations to be made to a court or
tribunal by a customer who has made a request under those regulations or in
10
respect of whom such a request has been made.
(6)
Subsection (8)(a) to (c) of section 75 applies for the purposes of this section as
it applies for the purposes of that section.
(7)
The Secretary of State may make payments out of money provided by
Parliament to an enforcer.
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(8)
In this section, “customer” and “regulated person” have the same meaning as
in section 75.
77
Supply of customer data: supplemental
(1)
The power to make regulations under section 75 or 76 includes—
(a)
power to make incidental, supplementary, consequential, transitional
20
or saving provision;
(b)
power to provide for a person to exercise a discretion in a matter.
(2)
Regulations under either of those sections must be made by statutory
instrument.
(3)
A statutory instrument containing regulations which consist of or include
25
provision made by virtue of section 75(2)(d) may not be made unless a draft of
the instrument has been laid before, and approved by a resolution of, each
House of Parliament.
(4)
A statutory instrument containing any other regulations under section 75 or 76
is subject to annulment in pursuance of a resolution of either House of
30
Parliament.
Equal pay audits
78
Power to provide for equal pay audits
(1)
The Equality Act 2010 is amended as follows.
(2)
After section 139 insert—
35
“139A
Equal pay audits
(1)
Regulations may make provision requiring an employment tribunal to
order the respondent to carry out an equal pay audit in any case where
the tribunal finds that there has been an equal pay breach.
(2)
An equal pay breach is—
40
(a)
a breach of an equality clause, or