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Companies (Audit, Investigations and Community Enterprise) Bill [HL]


Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 2 — Amendments relating to accounts and reports

57

 

Schedule 2

Section 25

 

Minor and consequential amendments relating to Part 1

Part 1

Amendments relating to auditors

Companies Act 1989 (c. 40)

5

1          

The Companies Act 1989 has effect subject to the following amendments.

2          

In section 30(5), for “Parts I and II” substitute “Parts I, II and III”.

3          

In the following provisions, for “established” substitute “designated”—

(a)   

sections 40(1)(a) and 47(3)(c);

(b)   

section 87(4) in the entry relating to bodies established by order

10

under section 46 of the Act.

Companies (Northern Ireland) Order 1990 (S.I. 1990/593(N.I. 5))

4          

In the Companies (Northern Ireland) Order 1990, omit Article 49 and

Schedule 14 (supervisory and qualifying bodies: restrictive practices).

Part 2

15

Amendments relating to accounts and reports

Companies Act 1985 (c. 6)

5          

The Companies Act 1985 has effect subject to the following amendments.

6          

In section 249E(2)(d) (rights to information)—

(a)   

for “section 389A(1) and (2)” substitute “sections 389A(1) and 389B(1)

20

and (5)”; and

(b)   

for “the auditors” substitute “an auditor”.

7          

In section 732(1) and (2)(a) (prosecution by public authorities), after “210,”

insert “245E, 245G,”.

8          

In section 733(1) (offences by body corporate), after “216(3)” insert “, 245E(3),

25

245G(7)”.

9          

In section 734(1) (criminal proceedings against unincorporated bodies)—

(a)   

after “under” insert “section 245E(3), section 245G(7),”; and

(b)   

omit “section 389A(3) or”.

10    (1)  

Schedule 24 (punishment of offences) is amended as follows.

30

      (2)  

After the entry relating to section 234(5) insert—

 

“234ZA

Making a statement

1. On indictment

2 years or a fine; or

—”.

 
 

(6)

in a directors’ report


both

  
  

as mentioned in

2. Summary

12 months or the

  
  

section 234ZA(2)

 

statutory maximum;

  

35

  

which is false

 

or both

  
 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 2 — Amendments relating to accounts and reports

58

 

      (3)  

After the entry relating to section 241A(10) insert—

 

“245E(3)

Using or disclosing

1. On indictment

2 years or a fine; or

 
  

tax information in


both

  
  

contravention of

2. Summary

12 months or the

  
  

section 245E(1) or (2)

 

statutory maximum;

  

5

    

or both

  
 

245G(7)

Disclosing

1. On indictment

2 years or a fine; or

—”.

 
  

information in


both

  
  

contravention of

2. Summary

12 months or the

  
  

section 245G(2) and

 

statutory maximum;

  

10

  

(3)

 

or both

  

      (4)  

For the entries relating to sections 389A(2), 389A(3) and 389A(4) substitute—

 

“389B(1)

Person making false,

1. On indictment

2 years or a fine; or

 
  

misleading or


both

  
  

deceptive statement

2. Summary

12 months or the

  

15

  

to auditor

 

statutory maximum;

  
    

or both

  
 

389B(2)

Failure to provide

Summary

Level 3 on the

 
  

information or

 

standard scale

  
  

explanations to

    

20

  

auditor

    
 

389B(4)

Parent company

Summary

Level 3 on the

—”.

 
  

failing to obtain from

 

standard scale

  
  

subsidiary

    
  

undertaking

    

25

  

information for

    
  

purposes of audit

    

Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6))

11         

The Companies (Northern Ireland) Order 1986 has effect subject to the

following amendments.

30

12         

In Article 680(1) and (2)(a) (prosecution by public authorities), after “218,”

insert “253E,”.

13         

In Article 680A(1) (offences by bodies corporate), after “224(3),” insert

“253E(3),”.

14         

In Article 680B(1) (criminal proceedings against unincorporated bodies),

35

after “Articles” insert “253E(3),”.

15         

In Schedule 23 (punishment of offences), after the entry relating to Articles

249(2) and 250(2) insert—

 

“253E(3)

Using or disclosing

1. On indictment

2 years or a fine; or

—”.

 
  

tax information in


both

  

40

  

contravention of

2. Summary

3 months or the

  
  

Article 253E(1) or (2)

 

statutory maximum;

  
    

or both

  
 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 3 — Amendments relating to investigations

59

 

Part 3

Amendments relating to investigations

Companies Act 1985 (c. 6)

16         

The Companies Act 1985 has effect subject to the following amendments.

17         

After section 447 insert—

5

“447A  Information provided: evidence

(1)   

A statement made by a person in compliance with a requirement

under section 447 may be used in evidence against him.

(2)   

But in criminal proceedings in which the person is charged with a

relevant offence—

10

(a)   

no evidence relating to the statement may be adduced by or

on behalf of the prosecution, and

(b)   

no question relating to it may be asked by or on behalf of the

prosecution,

   

unless evidence relating to it is adduced or a question relating to it is

15

asked in the proceedings by or on behalf of that person.

(3)   

A relevant offence is any offence other than the following—

(a)   

an offence under section 451,

(b)   

an offence under section 5 of the Perjury Act 1911 (false

statement made otherwise than on oath), or

20

(c)   

an offence under section 44(2) of the Criminal Law

(Consolidation) (Scotland) Act 1995 (false statement made

otherwise than on oath).”

18         

For section 449 substitute—

“449    

  Provision for security of information obtained

25

(1)   

This section applies to information (in whatever form) obtained—

(a)   

in pursuance of a requirement imposed under section 447;

(b)   

by means of a relevant disclosure within the meaning of

section 448A(2);

(c)   

by an investigator in consequence of the exercise of his

30

powers under section 453A.

(2)   

Such information must not be disclosed unless the disclosure—

(a)   

is made to a person specified in Schedule 15C, or

(b)   

is of a description specified in Schedule 15D.

(3)   

The Secretary of State may by order amend Schedules 15C and 15D.

35

(4)   

An order under subsection (3) must not—

(a)   

amend Schedule 15C by specifying a person unless the

person exercises functions of a public nature (whether or not

he exercises any other function);

(b)   

amend Schedule 15D by adding or modifying a description of

40

disclosure unless the purpose for which the disclosure is

permitted is likely to facilitate the exercise of a function of a

public nature.

 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 3 — Amendments relating to investigations

60

 

(5)   

An order under subsection (3) must be made by statutory instrument

subject to annulment in pursuance of a resolution of either House of

Parliament.

(6)   

A person who discloses any information in contravention of this

section—

5

(a)   

is guilty of an offence, and

(b)   

is liable on conviction to imprisonment or a fine or to both.

(7)   

Sections 732 (restriction on prosecutions), 733 (liability of individuals

for corporate default) and 734 (criminal proceedings against

unincorporated bodies) apply to the offence under subsection (6).

10

(8)   

Any information which may by virtue of this section be disclosed to

a person specified in Schedule 15C may be disclosed to any officer or

employee of the person.

(9)   

This section does not prohibit the disclosure of information if the

information is or has been available to the public from any other

15

source.

(10)   

Nothing in this section authorises the making of a disclosure in

contravention of the Data Protection Act 1998.”

19         

For section 451 substitute—

“451  Punishment for furnishing false information

20

(1)   

A person commits an offence if in purported compliance with a

requirement under section 447 to provide information—

(a)   

he provides information which he knows to be false in a

material particular;

(b)   

he recklessly provides information which is false in a

25

material particular.

(2)   

A person guilty of an offence under this section is liable on

conviction to imprisonment or a fine or to both.

(3)   

Sections 732 (restriction on prosecutions), 733 (liability of individuals

for corporate default) and 734 (criminal proceedings against

30

unincorporated bodies) apply to an offence under this section.”

20         

In section 451A (disclosure of information by Secretary of State or inspector),

for subsection (1) substitute—

“(1)   

This section applies to information obtained—

(a)   

under sections 434 to 446;

35

(b)   

by an inspector in consequence of the exercise of his powers

under section 453A.”

21         

In section 452—

(a)   

for subsection (1) substitute—

“(1)   

Nothing in sections 431 to 446 compels the disclosure by any

40

person to the Secretary of State or to an inspector appointed

by him of information in respect of which in an action in the

High Court a claim to legal professional privilege, or in an

action in the Court of Session a claim to confidentiality of

communications, could be maintained.”

45

 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 3 — Amendments relating to investigations

61

 

(b)   

for subsections (2) and (3) substitute—

“(2)   

Nothing in sections 447 to 451—

(a)   

compels the production by any person of a document

or the disclosure by any person of information in

respect of which in an action in the High Court a claim

5

to legal professional privilege, or in an action in the

Court of Session a claim to confidentiality of

communications, could be maintained;

(b)   

authorises the taking of possession of any such

document which is in the person’s possession.

10

(3)   

The Secretary of State must not under section 447 require, or

authorise a person to require—

(a)   

the production by a person carrying on the business

of banking of a document relating to the affairs of a

customer of his, or

15

(b)   

the disclosure by him of information relating to those

affairs,

   

unless one of the conditions in subsection (4) is met.

(4)   

The conditions are—

(a)   

the Secretary of State thinks it is necessary to do so for

20

the purpose of investigating the affairs of the person

carrying on the business of banking;

(b)   

the customer is a person on whom a requirement has

been imposed under section 447;

(c)   

the customer is a person on whom a requirement to

25

produce information or documents has been imposed

by an investigator appointed by the Secretary of State

in pursuance of section 171 or 173 of the Financial

Services and Markets Act 2000 (powers of persons

appointed under section 167 or as a result of section

30

168(2) to conduct an investigation).

(5)   

Despite subsections (1) and (2) a person who is a lawyer may

be compelled to disclose the name and address of his client.”

22         

In section 732 (prosecution by public authorities)—

(a)   

in subsection (1), for “447 to 451” substitute “448, 449 to 451, 453A”;

35

(b)   

in subsection (2)(b), for “447 to 451” substitute “448, 449 to 451 and

453A”.

(c)   

in subsection (3), after “privilege” insert “or, in Scotland,

confidentiality of communications”.

23         

In section 733 (offences by bodies corporate)—

40

(a)   

in subsection (1), for “and 447 to 451” substitute “, 448, 449 to 451 and

453A”;

(b)   

in subsection (4), for “447 to 451” substitute “448, 449 to 451 and

453A”.

24         

In section 734(1) (criminal proceedings against unincorporated bodies), for

45

“447 to 451” substitute “448, 449 to 451 or section 453A”.

 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 3 — Amendments relating to investigations

62

 

25         

After Schedule 15B insert—

“Schedule 15C

Section 449

 

Specified persons

1          

The Secretary of State.

2          

The Department of Enterprise, Trade and Investment for Northern

5

Ireland.

3          

The Treasury.

4          

The Lord Advocate.

5          

The Director of Public Prosecutions.

6          

The Director of Public Prosecutions for Northern Ireland.

10

7          

The Financial Services Authority.

8          

A constable.

9          

A procurator fiscal.

10         

The Scottish Ministers.

Schedule 15D

15

Section 449

 

Disclosures

1          

A disclosure for the purpose of enabling or assisting a person

authorised under section 245C to exercise his functions.

2          

A disclosure for the purpose of enabling or assisting an inspector

appointed under Part 14 to exercise his functions.

20

3          

A disclosure for the purpose of enabling or assisting a person

authorised under section 447 of this Act or section 84 of the

Companies Act 1989 to exercise his functions.

4          

A disclosure for the purpose of enabling or assisting a person

appointed under section 167 of the Financial Services and Markets

25

Act 2000 (general investigations) to conduct an investigation to

exercise his functions.

5          

A disclosure for the purpose of enabling or assisting a person

appointed under section 168 of the Financial Services and Markets

Act 2000 (investigations in particular cases) to conduct an

30

investigation to exercise his functions.

6          

A disclosure for the purpose of enabling or assisting a person

appointed under section 169(1)(b) of the Financial Services and

Markets Act 2000 (investigation in support of overseas regulator)

to conduct an investigation to exercise his functions.

35

7          

A disclosure for the purpose of enabling or assisting a person

appointed under section 284 of the Financial Services and Markets

Act 2000 (investigations into affairs of certain collective

investment schemes) to conduct an investigation to exercise his

functions.

40

 

 

Companies (Audit, Investigations and Community Enterprise) Bill [HL]
Schedule 2 — Minor and consequential amendments relating to Part 1
Part 3 — Amendments relating to investigations

63

 

8          

A disclosure for the purpose of enabling or assisting a person

appointed under regulations made under sections 262(1) and

(2)(k) of the Financial Services and Markets Act 2000

(investigations into open-ended investment companies) to

conduct an investigation to exercise his functions.

5

9          

A disclosure for the purpose of enabling or assisting the Secretary

of State or the Treasury to exercise any of their functions under

any of the following—

(a)   

this Act;

(b)   

the insider dealing legislation;

10

(c)   

the Insolvency Act 1986;

(d)   

the Company Directors Disqualification Act 1986;

(e)   

Part 2, 3 or 7 of the Companies Act 1989;

(f)   

the Financial Services and Markets Act 2000.

10         

A disclosure for the purpose of enabling or assisting the Scottish

15

Ministers to exercise their functions under the enactments relating

to insolvency.

11         

A disclosure for the purpose of enabling or assisting the

Department of Enterprise, Trade and Investment for Northern

Ireland to exercise any powers conferred on it by the enactments

20

relating to companies or insolvency.

12         

A disclosure for the purpose of enabling or assisting a person

appointed or authorised by the Department of Enterprise, Trade

and Investment for Northern Ireland under the enactments

relating to companies or insolvency to exercise his functions.

25

13         

A disclosure for the purpose of enabling or assisting the

Occupational Pensions Regulatory Authority to exercise their

functions under any of the following—

(a)   

the Pension Schemes Act 1993;

(b)   

the Pensions Act 1995;

30

(c)   

any enactment in force in Northern Ireland corresponding

to either of the above.

14         

A disclosure for the purpose of enabling or assisting the Bank of

England to exercise its functions.

15         

A disclosure for the purpose of enabling or assisting the body

35

known as the Panel on Takeovers and Mergers to exercise its

functions.

16         

A disclosure for the purpose of enabling or assisting organs of the

Society of Lloyd’s (being organs constituted by or under the

Lloyd’s Act 1982) to exercise their functions under or by virtue of

40

the Lloyd’s Acts 1871 to 1982.

17         

A disclosure for the purpose of enabling or assisting the Office of

Fair Trading to exercise its functions under any of the following—

(a)   

the Fair Trading Act 1973;

(b)   

the Consumer Credit Act 1974;

45

(c)   

the Estate Agents Act 1979;

(d)   

the Competition Act 1980;

 

 

 
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