House of Commons - Amendments
Company Law Reform Bill [Lords] - continued          House of Commons

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Saving for other restrictions on distributions

Margaret Hodge

NC304

    To move the following Clause:—

      ‘The provisions of this Part are without prejudice to any enactment, or any provision of a company’s articles, restricting the sums out of which, or the cases in which, a distribution may be made.’.


Minor definitions

Margaret Hodge

NC305

    To move the following Clause:—

      ‘(1) The following provisions apply for the purposes of this Part.

      (2) References to profit or losses of any description—

        (a) are to profits or losses of that description made at any time, and

        (b) except where the context otherwise requires, are to profits or losses of a revenue or capital character.

      (3) “Capitalisation”, in relation to a company’s profits, means any of the following operations (whenever carried out)—

        (a) applying the profits in wholly or partly paying up unissued shares in the company to be allotted to members of the company as fully or partly paid bonus shares, or

        (b) transferring the profits to capital redemption reserve.

      (4) References to “realised profits” and “realised losses”, in relation to a company’s accounts, are to such profits or losses of the company as fall to be treated as realised in accordance with principles generally accepted at the time when the accounts are prepared, with respect to the determination for accounting purposes of realised profits or losses.

      (5) Subsection (4) is without prejudice to—

        (a) the construction of any other expression (where appropriate) by reference to accepted accounting principles or practice, or

        (b) any specific provision for the treatment of profits or losses of any description as realised.’.


General power to make further provision by regulations

Margaret Hodge

NC306

    To move the following Clause:—

      ‘(1) The Secretary of State may by regulations modify the provisions of this Part.

      (2) The regulations may—

        (a) amend or repeal any of the provisions of this Part, or

        (b) make such other provision as appears to the Secretary of State appropriate in place of any of the provisions of this Part.

      (3) Regulations under this section may make consequential amendments or repeals in other provisions of this Act, or in other enactments.

      (4) Regulations under this section are subject to affirmative resolution procedure.’.


Charges created by a company

Margaret Hodge

NC307

    To move the following Clause:—

      ‘(1) A company that creates a charge to which this section applies must deliver the prescribed particulars of the charge, together with the instrument (if any) by which the charge is created or evidenced, to the registrar for registration before the end of the period allowed for registration.

      (2) Registration of a charge to which this section applies may instead be effected on the application of a person interested in it.

      (3) Where registration is effected on the application of some person other than the company, that person is entitled to recover from the company the amount of any fees properly paid by him to the registrar on registration.

      (4) If a company fails to comply with subsection (1), an offence is committed by—

        (a) the company, and

        (b) every officer of it 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.

      (6) Subsection (4) does not apply if registration of the charge has been effected on the application of some other person.

      (7) This section applies to the following charges—

        (a) a charge on land or any interest in land, other than a charge for any rent or other periodical sum issuing out of land,

        (b) a charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale,

        (c) a charge for the purposes of securing any issue of debentures,

        (d) a charge on uncalled share capital of the company,

        (e) a charge on calls made but not paid,

        (f) a charge on book debts of the company,

        (g) a floating charge on the company’s property or undertaking,

        (h) a charge on a ship or aircraft, or any share in a ship,

        (i) a charge on goodwill or on any intellectual property.’.


Charges which have to be registered: supplementary

Margaret Hodge

NC308

    To move the following Clause:—

      ‘(1) The holding of debentures entitling the holder to a charge on land is not, for the purposes of section (Charges created by a company)(7)(a), an interest in the land.

      (2) It is immaterial for the purposes of this Chapter where land subject to a charge is situated.

      (3) The deposit by way of security of a negotiable instrument given to secure the payment of book debts is not, for the purposes of section (Charges created by a company)(7)(f), a charge on those book debts.

      (4) For the purposes of section (Charges created by a company)(7)(i), “intellectual property” means—

        (a) any patent, trade mark, registered design, copyright or design right;

        (b) any licence under or in respect of any such right.

      (5) In this Chapter—

      “charge” includes mortgage, and

      “company” means a company registered in England and Wales or in Northern Ireland.’.


Charges existing on property acquired

Margaret Hodge

NC309

    To move the following Clause:—

      ‘(1) This section applies where a company acquires property which is subject to a charge of a kind which would, if it had been created by the company after the acquisition of the property, have been required to be registered under this Chapter.

      (2) The company must deliver the prescribed particulars of the charge, together with a certified copy of the instrument (if any) by which the charge is created or evidenced, to the registrar for registration.

      (3) Subsection (2) must be complied with before the end of the period allowed for registration.

      (4) If default is made in complying with this section, an offence is committed by—

        (a) the company, and

        (b) every officer of it 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.’.


Charge in series of debentures

Margaret Hodge

NC310

    To move the following Clause:—

      ‘(1) Where a series of debentures containing, or giving by reference to another instrument, any charge to the benefit of which debenture holders of that series are entitled pari passu is created by a company, it is for the purposes of section (Charges created by a company)(1) sufficient if the required particulars, together with the deed containing the charge (or, if there is no such deed, one of the debentures of the series), are delivered to the registrar before the end of the period allowed for registration.

      (2) The following are the required particulars—

        (a) the total amount secured by the whole series, and

        (b) the dates of the resolutions authorising the issue of the series and the date of the covering deed (if any) by which the series is created or defined, and

        (c) a general description of the property charged, and

        (d) the names of the trustees (if any) for the debenture holders.

      (3) Particulars of the date and amount of each issue of debentures of a series of the kind mentioned in subsection (1) must be sent to the registrar for entry in the register of charges.

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

      (5) Subsections (2) to (6) of section (Charges created by a company) apply for the purposes of this section as they apply for the purposes of that section, but as if references to the registration of the charge were a reference to the registration of the series of debentures.’.


Additional registration requirement for commission etc. in relation to debentures

Margaret Hodge

NC311

    To move the following Clause:—

      ‘(1) Where any commission, allowance or discount has been paid or made either directly or indirectly by a company to a person in consideration of his—

        (a) subscribing or agreeing to subscribe, whether absolutely or conditionally, for debentures in a company, or

        (b) procuring or agreeing to procure subscriptions, whether absolute or conditional, for such debentures,

      the particulars required to be sent for registration under section (Charges created by a company) shall include particulars as to the amount or rate per cent. of the commission, discount or allowance so paid or made.

      (2) The deposit of debentures as security for a debt of the company is not, for the purposes of this section, treated as the issue of debentures at a discount.

      (3) Failure to comply with this section does not affect the validity of the debentures issued.’.


Endorsement of certificate on debentures

Margaret Hodge

NC312

    To move the following Clause:—

      ‘(1) The company shall cause a copy of every certificate of registration given under section (Register of charges to be kept by registrar) to be endorsed on every debenture or certificate of debenture stock which is issued by the company, and the payment of which is secured by the charge so registered.

      (2) But this does not require a company to cause a certificate of registration of any charge so given to be endorsed on any debenture or certificate of debenture stock issued by the company before the charge was created.

      (3) If a person knowingly and wilfully authorises or permits the delivery of a debenture or certificate of debenture stock which under this section is required to have endorsed on it a copy of a certificate of registration, without the copy being so endorsed upon it, he commits an offence.

      (4) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale.’.


Charges created in, or over property in, jurisdictions outside the United Kingdom

Margaret Hodge

NC313

    To move the following Clause:—

      ‘(1) Where a charge is created outside the United Kingdom comprising property situated outside the United Kingdom, the delivery to the registrar of a verified copy of the instrument by which the charge is created or evidenced has the same effect for the purposes of this Chapter as the delivery of the instrument itself.

      (2) Where a charge is created in the United Kingdom but comprises property outside the United Kingdom, the instrument creating or purporting to create the charge may be sent for registration under section (Charges created by a company) even if further proceedings may be necessary to make the charge valid or effectual according to the law of the country in which the property is situated.’.


Charges over property in another United Kingdom jurisdiction

Margaret Hodge

NC314

    To move the following Clause:—

      ‘(1) Subsection (2) applies where—

        (a) a charge comprises property situated in a part of the United Kingdom other than the part in which the company is registered, and

        (b) registration in that other part is necessary to make the charge valid or effectual under the law of that part of the United Kingdom.

      (2) The delivery to the registrar of a verified copy of the instrument by which the charge is created or evidenced, together with a certificate stating that the charge was presented for registration in that other part of the United Kingdom on the date on which it was so presented has, for the purposes of this Chapter, the same effect as the delivery of the instrument itself.’.


Northern Ireland: registration of certain charges etc., affecting land

Margaret Hodge

NC315

    To move the following Clause:—

      ‘(1) Where a charge imposed by an order under Article 46 of the 1981 Order or notice of such a charge is registered in the Land Registry against registered land or any estate in registered land of a company, the Registrar of Titles shall as soon as may be cause 2 copies of the order made under Article 46 of that Order or of any notice under Article 48 of that Order to be delivered to the registrar.

      (2) Where a charge imposed by an order under Article 46 of the 1981 Order is registered in the Registry of Deeds against any unregistered land or estate in land of a company, the Registrar of Deeds shall as soon as may be cause 2 copies of the order to be delivered to the registrar.

      (3) On delivery of copies under this section, the registrar shall—

        (a) register one of them in accordance with section (Register of charges to be kept by registrar), and

        (b) not later than 7 days from that date of delivery, cause the other copy together with a certificate of registration under section (Register of charges to be kept by registrar)(5) to be sent to the company against which judgment was given.

      (4) Where a charge to which subsection (1) or (2) applies is vacated, the Registrar of Titles or, as the case may be, the Registrar of Deeds shall cause a certified copy of the certificate of satisfaction lodged under Article 132(1) of the 1981 Order to be delivered to the registrar for entry of a memorandum of satisfaction in accordance with section (Entries of release and satisfaction).

      (5) In this section—

      “the 1981 Order” means the Judgments Enforcement (Northern Ireland) Order 1981;

      “the Registrar of Deeds” means the registrar appointed under the Registration of Deeds Act (Northern Ireland) 1970,

      “Registry of Deeds” has the same meaning as in the Registration of Deeds Acts,

      “Registration of Deeds Acts” means the Registration of Deeds (Northern Ireland) 1970 (c. 25) and every statutory provision for the time being in force amending that Act or otherwise relating to the registry of deeds, or the registration of deeds, orders or other instruments or documents in such registry,

      “the Land Registry” and “the Registrar of Titles” are to be construed in accordance with section 1 of the Land Registration Act (Northern Ireland) 1970 (c. 18),

      “registered land” and “unregistered land” have the same meaning as in Part 3 of the Land Registration Act (Northern Ireland) 1970.’.


Register of charges to be kept by registrar

Margaret Hodge

NC316

    To move the following Clause:—

      ‘(1) The registrar shall keep, with respect to each company, a register of all the charges requiring registration under this Chapter.

      (2) In the case of a charge to the benefit of which holders of a series of debentures are entitled, the registrar shall enter in the register the required particulars specified in section (Charge in series of debentures)(2).

      (3) In the case of a charge imposed by the Enforcement of Judgments Office under Article 46 of the Judgments Enforcement (Northern Ireland) 1981, the registrar shall enter in the register the date on which the charge became effective.

      (4) In the case of any other charge, the registrar shall enter in the register the following particulars—

        (a) if it is a charge created by a company, the date of its creation and, if it is a charge which was existing on property acquired by the company, the date of the acquisition,

        (b) the amount secured by the charge,

        (c) short particulars of the property charged, and

        (d) the persons entitled to the charge.

      (5) The registrar shall give a certificate of the registration of any charge registered in pursuance of this Chapter, stating the amount secured by the charge.

      (6) The certificate—

        (a) shall be signed by the registrar or authenticated by the registrar’s official seal, and

        (b) is conclusive evidence that the requirements of this Chapter as to registration have been satisfied.

      (7) The register kept in pursuance of this section shall be open to inspection by any person.’.


The period allowed for registration

Margaret Hodge

NC317

    To move the following Clause:—

      ‘(1) The period allowed for registration of a charge created by a company is—

        (a) 21 days beginning with the day after the day on which the charge is created, or

        (b) if the charge is created outside the United Kingdom, 21 days beginning with the day after the day on which the instrument by which the charge is created or evidenced (or a copy of it) could, in due course of post (and if despatched with due diligence) have been received in the United Kingdom.

      (2) The period allowed for registration of a charge to which property acquired by a company is subject is—

        (a) 21 days beginning with the day after the day on which the acquisition is completed, or

        (b) if the property is situated and the charge was created outside the United Kingdom, 21 days beginning with the day after the day on which the instrument by which the charge is created or evidenced (or a copy of it) could, in due course of post (and if despatched with due diligence) have been received in the United Kingdom.

      (3) The period allowed for registration of particulars of a series of debentures as a result of section (Charge in series of debentures) is—

        (a) if there is a deed containing the charge mentioned in section (Charge in series of debentures)(1), 21 days beginning with the day after the day on which that deed is executed, or

        (b) if there is no such deed, 21 days beginning with the day after the day on which the first debenture of the series is executed.’.


Registration of enforcement of security

Margaret Hodge

NC318

    To move the following Clause:—

      ‘(1) If a person obtains an order for the appointment of a receiver or manager of a company’s property, or appoints such a receiver or manager under powers contained in an instrument, he shall within 7 days of the order or of the appointment under those powers, give notice of the fact to the registrar.

      (2) Where a person appointed receiver or manager of a company’s property under powers contained in an instrument ceases to act as such receiver or manager, he shall, on so ceasing, give the registrar notice to that effect.

      (3) The registrar must enter a fact of which he is given notice under this section in the register of charges.

      (4) A person who makes default in complying with the requirements of this section commits an offence.

      (5) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, to a daily default fine not exceeding one-tenth of level 3 on the standard scale.’.


Entries of satisfaction and release

Margaret Hodge

NC319

    To move the following Clause:—

      ‘(1) Subsection (2) applies if a statement is delivered to the registrar verifying with respect to a registered charge—

        (a) that the debt for which the charge was given has been paid or satisfied in whole or in part, or

        (b) that part of the property or undertaking charged has been released from the charge or has ceased to form part of the company’s property or undertaking.

      (2) The registrar may enter on the register a memorandum of satisfaction in whole or in part, or of the fact part of the property or undertaking has been released from the charge or has ceased to form part of the company’s property or undertaking (as the case may be).

      (3) Where the registrar enters a memorandum of satisfaction in whole, the registrar shall if required send the company a copy of it.’.


Rectification of register of charges

Margaret Hodge

NC320

    To move the following Clause:—

      ‘(1) Subsection (2) applies if the court is satisfied—

        (a) that the failure to register a charge before the end of the period allowed for registration, or the omission or mis-statement of any particular with respect to any such charge or in a memorandum of satisfaction—

          (i) was accidental or due to inadvertence or to some other sufficient cause, or

          (ii) is not of a nature to prejudice the position of creditors or shareholders of the company, or

        (b) that on other grounds it is just and equitable to grant relief.

      (2) The court may, on the application of the company or a person interested, and on such terms and conditions as seem to the court just and expedient, order that the period allowed for registration shall be extended or, as the case may be, that the omission or mis-statement shall be rectified.’.


 
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Prepared: 20 July 2006