| Company Law Reform Bill [Lords] - continued | House of Commons |
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Traded companies: nomination of person to enjoy information rights Margaret Hodge NC37 To move the following Clause:— ‘(1) This section applies to a company whose shares are admitted to trading on a regulated market. (2) A member of such a company who holds shares on behalf of another person may nominate that person to enjoy information rights. (3) “Information rights” means— (a) the right to receive a copy of all communications that the company sends to its members generally or to any class of its members that includes the person making the nomination, and (b) the rights conferred by— (i) section 415 or 416 (right to require copies of accounts and reports), and (ii) section 797 (right to require hard copy version of document or information provided in another form). (4) A company need not act on a nomination purporting to relate to certain information rights only.’. Information rights: form in which copies to be provided Margaret Hodge NC38 To move the following Clause:— ‘(1) This section applies as regards the form in which copies are to be provided to a person nominated under section (Traded companies: nomination of person to enjoy information rights) (nomination of person to enjoy information rights). (2) If the person to be nominated wishes to receive hard copy communications, he must— (a) request the person making the nomination to notify the company of that fact, and (b) provide an address to which such copies may be sent. This must be done before the nomination is made. (3) If having received such a request the person making the nomination— (a) notifies the company that the nominated person wishes to receive hard copy communications, and (b) provides the company with that address, the right of the nominated person is to receive hard copy communications accordingly. (4) This is subject to the provisions of Parts 3 and 4 of Schedule 7 (communications by traded company) under which the company may take steps to enable it to communicate in electronic form or by means of a website. (5) If no such notification is given (or no address is provided), the nominated person is taken to have agreed that documents or information may be sent or supplied to him by the company by means of a website. (6) That agreement— (a) may be revoked by the nominated person, and (b) does not affect his right under section 797 to require a hard copy version of a document or information provided in any other form.’. Termination or suspension of nomination Margaret Hodge NC39 To move the following Clause:— ‘(1) The following provisions have effect in relation to a nomination under section (Traded companies: nomination of person to enjoy information rights) (nomination of person to enjoy information rights). (2) The nomination may be terminated at the request of the member or of the nominated person. (3) The nomination ceases to have effect on the occurrence in relation of the member or the nominated person of any of the following— (a) in the case of an individual, death or bankruptcy; (b) in the case of a body corporate, dissolution or the making of an order for the winding up of the body otherwise than for the purposes of reconstruction. (4) In subsection (3)— (a) the reference to bankruptcy includes— (i) the sequestration of a person’s estate, and (ii) a person’s estate being the subject of a protected
trust deed (within the meaning of the (b) the reference to the making of an order for winding up is to— (i) the making of such an order under the (ii) any corresponding proceeding under the law of a country or territory outside the United Kingdom. (5) The effect of any nominations made by a member is suspended at any time when there are more nominated persons than the member has shares in the company. (6) Where— (a) the member holds different classes of shares with different information rights, and (b) there are more nominated persons than he has shares conferring a particular right, the effect of any nominations made by him is suspended to the extent that they confer that right. (7) Where the company— (a) enquires of a nominated person whether he wishes to retain information rights, and (b) does not receive a response within the period of 28 days beginning with the date on which the company’s enquiry was sent, the nomination ceases to have effect at the end of that period. Such an enquiry is not to be made of a person more than once in any twelve- month period. (8) The termination or suspension of a nomination means that the company is not required to act on it. It does not prevent the company from continuing to do so, to such extent or for such period as it thinks fit.’. Information as to possible rights in relation to voting Margaret Hodge NC40 To move the following Clause:— ‘(1) This section applies where a company sends a copy of a notice of a meeting to a person nominated under section (Traded companies: nomination of person to enjoy information rights) (nomination of person to enjoy information rights) (2) The copy of the notice must be accompanied by a statement that— (a) he may have a right under an agreement between him and the member by whom he was nominated to be appointed, or to have someone else appointed, as a proxy for the meeting, or (b) if he has no such right or does not wish to exercise it, he may have a right under such an agreement to give instructions to the member as to the exercise of voting rights. (3) Section 308 (notice of meeting to contain statement of member’s rights in relation to appointment of proxy) does not apply to the copy, and the company must either— (a) omit the notice required by that section, or (b) include it but state that it does not apply to the nominated person.’. Information rights: status of rights Margaret Hodge NC41 To move the following Clause:— ‘(1) This section has effect as regards the rights conferred by a nomination under section (Traded companies: nomination of person to enjoy information rights) (nomination of person to enjoy information rights). (2) Enjoyment by the nominated person of the rights conferred by the nomination is enforceable against the company by the member as if they were rights conferred by the company’s articles. (3) Any enactment, and any provision of the company’s articles, having effect in relation to communications with members has a corresponding effect (subject to any necessary adaptations) in relation to communications with the nominated person. (4) In particular— (a) where under any enactment, or any provision of the company’s articles, the members of a company entitled to receive a document or information are determined as at a date or time before it is sent or supplied, the company need not send or supply it to a nominated person— (i) whose nomination was received by the company after that date or time, or (ii) if that date or time falls in a period of suspension of his nomination; and (b) where under any enactment, or any provision of the company’s articles, the right of a member to receive a document or information depends on the company having a current address for him, the same applies to any person nominated by him. (5) The rights conferred by the nomination— (a) are in addition to the rights of the member himself, and (b) do not affect any rights exercisable by virtue of any such provision as is mentioned in section (Effect of provisions of articles as to enjoyment or exercise of members’ rights) (provisions of company’s articles as to enjoyment or exercise of members’ rights). (6) A failure to give effect to the rights conferred by the nomination does not affect the validity of anything done by or on behalf of the company. (7) References in this section to the rights conferred by the nomination are to— (a) the rights referred to in section (Traded companies: nomination of person to enjoy information rights)(3) (information rights), and (b) where applicable, the rights conferred by section (Information rights: form in which copies to be provided)(3) (right to hard copy communications) and section (Information as to possible rights in relation to voting) (information as to possible voting rights).’. Information rights: power to amend Margaret Hodge NC42 To move the following Clause:— ‘(1) The Secretary of State may by regulations amend the provisions of sections (Traded companies: nomination of persons to enjoy information rights) to (Information rights: status of rights) (information rights) so as to— (a) extend or restrict the classes of companies to which section (Traded companies: nomination of persons to enjoy information rights) applies, (b) make other provision as to the circumstances in which a nomination may be made under that section, or (c) extend or restrict the the rights conferred by such a nomination. (2) The regulations may make such consequential modifications of any other provisions of this Part, or of any other enactment, as appear to the Secretary of State to be necessary. (3) Regulations under this section are subject to affirmative resolution procedure.’. Exercise of rights where shares held on behalf of others: exercise in different ways Margaret Hodge NC43 To move the following Clause:— ‘(1) Where a person holds shares in a company on behalf of more than one person— (a) rights attached to the shares, and (b) rights under any enactment exercisable by the person holding the shares, need not all be exercised, and if exercised, need not all be exercised in the same way. (2) A member who exercises such rights but does not exercise all his rights, must inform the company to what extent he is exercising the rights. (3) A member who exercises such rights in different ways must inform the company of the ways in which he is exercising them and to what extent they are exercised in each way. (4) If a member exercises such rights without informing the company— (a) that he is not exercising all his rights, or (b) that he is exercising his rights in different ways, the company is entitled to assume that he is exercising all his rights and is exercising them in the same way.’. Exercise of rights where shares held on behalf of others: members’ requests Margaret Hodge NC44 To move the following Clause:— ‘(1) This section applies for the purposes of— (a) section 297 (power to require circulation of statement), (b) section 321 (public companies: power to require circulation of resolution for AGM), (c) section 325 (power to require independent report on poll), and (d) section 517 (power to require website publication of audit concerns). (2) A company is required to act under any of those sections if it receives a request in relation to which the following conditions are met— (a) it is made by at least 100 persons; (b) it is authenticated by all the persons making it; (c) in the case of any of those persons who is not a member of the company, it is accompanied by a statement— (i) of the full name and address of a person (“the member”) who is a member of the company and holds shares on behalf of that person, (ii) that the member is holding those shares on behalf of that person in the course of a business, (iii) of the number of shares in the company that the member holds on behalf of that person, (iv) of the total amount paid up on those shares, (v) that those shares are not held on behalf of anyone else or, if they are, that the other person or persons are not among the other persons making the request, (vi) that some or all of those shares confer voting rights that are relevant for the purposes of making a request under the section in question, and (vii) that the person has the right to instruct the member how to exercise those rights; (d) in the case of any of those persons who is a member of the company, it is accompanied by a statement— (i) that he holds shares otherwise than on behalf of another person, or (ii) that he holds shares on behalf of one or more other persons but those persons are not among the other persons making the request; (e) it is accompanied by such evidence as the company may reasonably require of the matters mentioned in paragraph (c) and (d); (f) the total amount of the sums paid up on— (i) shares held as mentioned in paragraph (c), and (ii) shares held as mentioned in paragraph (d), divided by the number of persons making the request, is not less than £100; (g) the request complies with any other requirements of the section in question as to contents, timing and otherwise.’. Shares Margaret Hodge NC45 To move the following Clause:— ‘(1) In the Companies Acts “share”, in relation to a company, means share in the company’s share capital. (2) A company’s shares may no longer be converted into stock. (3) Stock created before the commencement of this Part may be reconverted into shares in accordance with section (Re-conversion of stock into shares). (4) In the Companies Acts— (a) references to shares include stock except where a distinction between share and stock is express or implied, and (b) references to a number of shares include an amount of stock where the context admits of the reference to shares being read as including stock.’. Nature of shares Margaret Hodge NC46 To move the following Clause:— The shares or other interest of a member in a company are personal property (or, in Scotland, moveable property) and are not in the nature of real estate (or heritage).’. Nominal value of shares Margaret Hodge NC47 To move the following Clause:— ‘(1) Shares in a limited company having a share capital must each have a fixed nominal value. (2) An allotment of a share that does not have a fixed nominal value is void. (3) Shares in a limited company having a share capital may be denominated in any currency, and different classes of shares may be denominated in different currencies. (4) If a company purports to allot shares in contravention of this section, an offence is committed by every officer of the company who is in default. (5) A person guilty of an offence under this section is liable— (a) on conviction on indictment, to a fine, and (b) on summary conviction, to a fine not exceeding the statutory maximum.’. Numbering of shares Margaret Hodge NC48 To move the following Clause:— ‘(1) Each share in a company having a share capital must be distinguished by its appropriate number, except in the following circumstances. (2) If at any time— (a) all the issued shares in a company are fully paid up and rank pari passu for all purposes, or (b) all the issued shares of a particular class in a company are fully paid up and rank pari passu for all purposes, none of those shares need thereafter have a distinguishing number so long as it remains fully paid up and ranks pari passu for all purposes with all shares of the same class for the time being issued and fully paid up.’. Transferability of shares Margaret Hodge NC49 To move the following Clause:— ‘(1) The shares or other interest of any member in a company are transferable in accordance with the company’s articles. (2) This is subject to— (a) the (b) regulations under Chapter (Evidencing and transferring title to securities without written instrument) of Part (Certification and transfer of securities) of this Act (which enable title to securities to be evidenced and transferred without a written instrument). (3) See Part 21 of this Act generally as regards share transfers.’. Companies having a share capital Margaret Hodge NC50 To move the following Clause:— References in the Companies Acts to a company having a share capital are to a company that has power under its constitution to issue shares.’. Issued and allotted share capital Margaret Hodge NC51 To move the following Clause:— ‘(1) References in the Companies Acts— (a) to “issued share capital” are to shares of a company that have been issued; (b) to “allotted share capital” are to shares of a company that have been allotted. (2) References in the Companies Acts to issued or allotted shares, or to issued or allotted share capital, include shares taken on the formation of the company by the subscribers to the company’s memorandum.’. Called-up share capital Margaret Hodge NC52 To move the following Clause:— In the Companies Acts— “called-up share capital”, in relation to a company, means so much of its share capital as equals the aggregate amount of the calls made on its shares (whether or not those calls have been paid), together with— (a) any share capital paid up without being called, and (b) any share capital to be paid on a specified future date under the articles, the terms of allotment of the relevant shares or any other arrangements for payment of those shares; and “uncalled share capital” is to be construed accordingly.’. Equity share capital Margaret Hodge NC53 To move the following Clause:— In the Companies Acts “equity share capital”, in relation to a company, means its issued share capital excluding any part of that capital that does not carry any right (either as respects dividends or as respects capital) to participate beyond a specified amount in a distribution.’. Exercise by directors of power to allot shares etc Margaret Hodge NC54 To move the following Clause:— ‘(1) The directors of a company must not exercise any power of the company— (a) to allot shares in the company, or (b) to grant rights to subscribe for, or to convert any security into, shares in the company, except in accordance with section (Power of directors to allot shares etc: private company with only one class of shares) (private company with single class of shares) or section (Power of directors to allot shares etc: authorisation by company) (authorisation by company). (2) Subsection (1) does not apply— (a) to the allotment of shares in pursuance of an employees’ share scheme, or (b) to the grant of a right to subscribe for, or to convert any security into, shares so allotted. (3) If this section applies in relation to the grant of a right to subscribe for, or to convert any security into, shares, it does not apply in relation to the allotment of shares pursuant to that right. (4) A director who knowingly contravenes, or permits or authorises a contravention of, this section commits an offence. (5) A person guilty of an offence under this section is liable— (a) on conviction on indictment, to a fine; (b) on summary conviction, to a fine not exceeding the statutory maximum. (6) Nothing in this section affects the validity of an allotment or other transaction.’. |
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| © Parliamentary copyright 2006 | Prepared: 20 July 2006 |