Company Law Reform Bill [HL]

House of Commons

Session 2005 - 06
Internet Publications
Other Bills before Parliament

Company Law Reform Bill [HL]

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 2 — Communications in hard copy form
497

      (5)
References in this paragraph to the bankruptcy of a person include—
(a)
the sequestration of the estate of a person;
(b)
a person’s estate being the subject of a protected trust deed (within
the meaning of the Bankruptcy (Scotland) Act 1985 (c. 66)).

In such a case the reference in sub-paragraph (2)(b) to the trustee of the
5
bankrupt is to be read as the permanent or interim trustee (within the
meaning of that Act) on the sequestrated estate or, as the case may be, the
trustee under the protected deed.
Schedule 7
795(2)

Communications by a traded company
10
Part 1
Introduction
Application of this Schedule
1
This Schedule applies to documents or information sent or supplied by
traded companies.
15
Part 2
Communications in hard copy form
Introduction
2
A document or information is validly sent or supplied by a traded company
if it is sent or supplied in hard copy form in accordance with this Part of this
20
Schedule.
Method of communication in hard copy form
3     (1)
A document or information in hard copy form must be—
(a)
handed to the intended recipient, or
(b)
sent or supplied by hand or by post to an address (in accordance with
25
paragraph 4).
      (2)
For the purposes of this Schedule, a person sends a document or information
by post if he prepays and posts an envelope containing the document or
information.
Address for communications in hard copy form
30
4     (1)
Documents or information in hard copy form may be sent or supplied by the
traded company—
(a)
to an address specified for the purpose by the intended recipient;
(b)
to a company at its registered office;
(c)
to a person in his capacity as a member of the company at his address
35
as shown in the company’s register of members;

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 3 — Communications in electronic form
498

(d)
to a person in his capacity as a director of the company at his address
as shown in the company’s register of directors;
(e)
to an address to which any provision of the Companies Acts
authorises the document or information to be sent or supplied.
      (2)
Where the traded company is unable to obtain an address falling within sub-
5
paragraph (1), the documents or information may be sent or supplied to the
intended recipient’s last address known to the company.
Part 3
Communications in electronic form
Introduction
10
5     (1)
A document or information is validly sent or supplied by a traded company
if it is sent in electronic form in accordance with this Part of this Schedule.
      (2)
This paragraph has effect subject to any requirements or contrary provision
in the Companies Acts.
Agreement to communications in electronic form
15
6     (1)
A document or information may only be sent or supplied by a traded
company in electronic form—
(a)
to a person who has agreed (generally or specifically) that the
document or information may be sent or supplied in that form (and
has not revoked that agreement), or
20
(b)
to a company that is deemed to have so agreed by a provision in the
Companies Acts.
      (2)
A document or information may not be sent or supplied by a traded
company in electronic form to—
(a)
a member of the company,
25
(b)
a person identified by a member (in accordance with the company’s
articles or regulations made under section 137) as entitled to enjoy or
exercise all or any specified rights of the member in relation to the
company, or
(c)
a holder of debt securities of the company,
30

except in accordance with paragraph 7 or 8 (resolution required before
documents and information sent or supplied in electronic form).
Resolution required for communications in electronic form with members of traded company
etc
7     (1)
This paragraph applies to documents or information to be sent or supplied
35
to a person—
(a)
as a member of a traded company, or
(b)
as a person identified by a member (in accordance with the
company’s articles or regulations made under section 137) as entitled
to enjoy or exercise all or any specified rights of the member in
40
relation to the company.
      (2)
The company may only send or supply such documents or information in
electronic form if—

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 3 — Communications in electronic form
499

(a)
the members of the company have resolved that it may do so, or
(b)
the company’s articles contain provision to that effect.
      (3)
A resolution under this paragraph is subject to Chapter 3 of Part 3 of this Act
(resolutions affecting company’s constitution).
Resolution required for communications in electronic form with holders of debt securities
5
8     (1)
This paragraph applies to documents or information to be sent or supplied
to a person as a holder of debt securities of a traded company.
      (2)
The company may only send or supply such documents or information in
electronic form if—
(a)
the relevant holders of debt securities have duly resolved that it may
10
do so, or
(b)
the instrument creating the debt securities in question contains
provision to that effect.
      (3)
For the purposes of this paragraph—
(a)
the relevant holders of debt securities are the holders of debt
15
securities of the company ranking pari passu for all purposes with
the intended recipient, and
(b)
a resolution of the relevant holders of debt securities is duly passed
if they agree in accordance with the provisions of the instruments
creating the debt securities.
20
      (4)
In this Part of this Schedule, “debt securities” means bonds or other forms of
transferable securitised debts, with the exception of securities—
(a)
that are equivalent to shares in companies, or
(b)
that if converted, or if the rights conferred by them are exercised,
give rise to a right to acquire shares or securities equivalent to shares.
25
Address for communications in electronic form
9     (1)
Where the document or information is sent or supplied by electronic means,
it may only be sent or supplied to an address—
(a)
specified for the purpose by the intended recipient (generally or
specifically), or
30
(b)
where the intended recipient is a company, deemed by a provision
of the Companies Acts to have been so specified.
      (2)
Where the document or information is sent or supplied in electronic form by
hand or by post, it must be—
(a)
handed to the intended recipient, or
35
(b)
sent or supplied to an address to which it could be validly sent if it
were in hard copy form.

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 4 — Communications by means of a website
500

Part 4
Communications by means of a website
Use of website
10    (1)
A document or information is validly sent or supplied by a traded company
if it is made available on a website in accordance with this Part of this
5
Schedule.
      (2)
This paragraph has effect subject to any requirements or contrary provision
in the Companies Acts.
Use of website to communicate with members of traded company etc
11    (1)
This paragraph applies to a document or information to be sent or supplied
10
by a traded company to a person—
(a)
as a member of the company, or
(b)
as a person identified by a member (in accordance with the
company’s articles or regulations made under section 137) as entitled
to enjoy or exercise all or any specified rights of the member in
15
relation to the company (an “entitled person”).
      (2)
The company may only send or supply such documents or information by
making them available on a website if—
(a)
the members of the company have resolved that it may do so, or
(b)
the company’s articles contain provision to that effect.
20
      (3)
The traded company may only send or supply such documents or
information in that manner to members or entitled persons who—
(a)
have agreed that the company may send or supply documents or
information generally, or the documents or information in question,
to them in that manner, or
25
(b)
are taken to have so agreed under the following provisions,

and have not revoked that agreement.
      (4)
A person is taken to have so agreed if—
(a)
he has been asked individually by the company to agree that the
company may send or supply documents or information generally,
30
or the documents or information in question, to him in that manner,
and
(b)
the company has not received a response within the period of 28
days beginning with the date on which the company’s request was
sent.
35
      (5)
A person is not taken to have so agreed if the company’s request—
(a)
did not state clearly what the effect of a failure to respond would be,
or
(b)
was sent less than twelve months after a previous request made to
him in respect of the same or a similar class of documents or
40
information.
      (6)
A resolution under this paragraph is subject to Chapter 3 of Part 3 of this Act
(resolutions affecting company’s constitution).

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 4 — Communications by means of a website
501

Use of website to communicate with holders of debt securities
12    (1)
This paragraph applies to a document or information to be sent or supplied
by a traded company to a person as a holder of debt securities of the
company.
      (2)
The company may only send or supply such documents or information by
5
making them available on a website if—
(a)
the relevant holders of debt securities have duly resolved that it may
do so, or
(b)
the instrument creating the debt securities in question contains
provision to that effect.
10
      (3)
The traded company may only send or supply such documents in that
manner to holders of debt securities who—
(a)
have agreed that the company may send or supply documents or
information generally, or the documents or information in question,
to them in that manner, or
15
(b)
are taken to have so agreed under the following provisions,

and have not revoked that agreement.
      (4)
A person is taken to have so agreed if—
(a)
he has been asked individually by the company to agree that the
company may send or supply documents or information generally,
20
or the documents or information in question, to him in that manner,
and
(b)
the company has not received a response within the period of 28
days beginning with the date on which the company’s request was
sent.
25
      (5)
A person is not taken to have so agreed if the company’s request—
(a)
did not state clearly what the effect of a failure to respond would be,
or
(b)
was sent less than twelve months after any previous request made to
him in respect of the same or a similar class of documents or
30
information.
      (6)
For the purposes of this paragraph—
(a)
the relevant holders of debt securities are the holders of debt
securities of the company ranking pari passu for all purposes with
the intended recipient, and
35
(b)
a resolution of the relevant holders of debt securities is duly passed
if they agree in accordance with the provisions of the instruments
creating the debt securities.
      (7)
In this Part of this Schedule, “debt securities” means bonds or other forms of
transferable securitised debts, with the exception of securities—
40
(a)
that are equivalent to shares in companies, or
(b)
that if converted, or if the rights conferred by them are exercised,
give rise to a right to acquire shares or securities equivalent to shares.

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 4 — Communications by means of a website
502

Use of website to communicate with other debenture holders
13    (1)
A document or information may only be sent or supplied by the company to
a person as a holder of debentures of the company (other than debt
securities) by being made available on a website if the person—
(a)
has agreed (generally or specifically) that the document or
5
information may be sent or supplied to him in that manner, or
(b)
is taken to have so agreed under this paragraph,

and has not revoked that agreement.
      (2)
To the extent that—
(a)
the relevant debenture holders have duly resolved that the company
10
may send or supply documents or information to them by making
them available on a website, or
(b)
the instrument creating the debenture in question contains provision
to that effect,

a debenture holder in relation to whom the following conditions are met is
15
taken to have agreed that documents or information may be sent or supplied
to him by the company in that manner.
      (3)
The conditions are that—
(a)
the debenture holder has been asked individually by the company to
agree that the company may send or supply documents or
20
information generally, or the documents or information in question,
to him by means of a website, and
(b)
the company has not received a response within the period of 28
days beginning with the date on which the company’s request was
sent.
25
      (4)
A person is not taken to have so agreed if the company’s request—
(a)
did not state clearly what the effect of a failure to respond would be,
or
(b)
was sent less than twelve months after a previous request made to
him for the purposes of this paragraph in respect of the same or a
30
similar class of documents or information.
      (5)
For the purposes of this paragraph—
(a)
the relevant debenture holders are the holders of debentures of the
company (other than debt securities) ranking pari passu for all
purposes with the intended recipient, and
35
(b)
a resolution of the relevant debenture holders is duly passed if they
agree in accordance with the provisions of the instruments creating
the debentures.
Use of website to communicate with other persons
14
A document or information may only be sent or supplied by a traded
40
company to a person who is not—
(a)
a member of the company or an entitled person, or
(b)
a holder of debentures of the company,

by being made available on a website if the person has agreed (generally or
specifically) that the document or information may be sent or supplied to
45
him in that manner (and has not revoked that agreement).

Company Law Reform Bill [HL]
Schedule 7 — Communications by a traded company
Part 5 — Other agreed forms of communication
503

Availability of document or information
15    (1)
A document or information authorised or required to be sent or supplied by
means of a website must be made available in a form, and by a means, that
the company reasonably considers will enable the recipient—
(a)
to read it, and
5
(b)
to retain a copy of it.
      (2)
For this purpose a document or information can be read only if—
(a)
it can be read with the naked eye, or
(b)
to the extent that it consists of images (for example photographs,
pictures, maps, plans or drawings), it can be seen with the naked eye.
10
Notification of availability
16    (1)
The traded company must notify the intended recipient of—
(a)
the presence of the document or information on the website,
(b)
the address of the website,
(c)
the place on the website where it may be accessed, and
15
(d)
how to access the document or information.
      (2)
The document or information is taken to be sent—
(a)
on the date on which the notification required by this paragraph is
sent, or
(b)
if later, the date on which the document or information first appears
20
on the website after that notification is sent.
Period of availability on website
17    (1)
The traded company must make the document or information available on
the website throughout—
(a)
the period specified by any applicable provision of the Companies
25
Acts, or
(b)
if no such period is specified, the period of 28 days beginning with
the date on which the notification required under paragraph 16 is
sent to the person in question.
      (2)
For the purposes of this paragraph, a failure to make a document or
30
information available on a website throughout the period mentioned in sub-
paragraph (1) shall be disregarded if—
(a)
it is made available on the website for part of that period, and
(b)
the failure to make it available throughout that period is wholly
attributable to circumstances that it would not be reasonable to have
35
expected the company to prevent or avoid.
Part 5
Other agreed forms of communication
18    (1)
A document or information that is sent or supplied otherwise than in hard
copy or electronic form or by means of a website is validly sent or supplied
40
if it is sent or supplied in a form or manner that has been agreed by the
intended recipient.