|
Clause 735: Allocation of unique identifiers
1318. This clause is a new provision. It gives the Secretary of State a power to make regulations so that individuals, for example company directors, are allocated a unique identifier. This provision supports those that provide for the home addresses of all directors to be kept off the public record (see Part 10, Chapter 8). The unique identifier will enable searchers to distinguish between different persons of the same name.
Clause 736: Preservation of original documents
Clause 737: Records relating to companies that have been dissolved etc
1319. Clause 736 replaces section 707A(2) of the 1985 Act. However, the obligation on the registrar to keep the originals of documents received will now only apply for three years (as opposed to ten in the existing provision). The clause also makes clear that the obligation to retain originals does not extend to an original document provided electronically (provided of course that the information itself has been placed on the register).
1320. Clause 737 replaces sections 707(3) and (4) of the 1985 Act, and provides that records may be transferred to the Public Records Office two years after a company has been dissolved. It also makes equivalent provision for certain overseas companies which, for example, by ceasing to have any connection with the UK, are no longer caught by UK regulatory requirements.
Inspection etc of the register
Clause 738: Inspection of the register
1321. This clause makes clear that any person may inspect the register. Searchers will however have a right to inspect the original of a hard copy document only where the registrar still retains it and where the public record kept by the registrar and derived from it is illegible or unavailable.
Clause 739: Right to copy of material on the register
1322. This clause makes clear that any person is entitled to a copy of material on the register. Consistent with the provisions of the amended First Company Law Directive (68/151/EEC), Subsection (2) provides that the fee for a copy may not exceed the administrative cost of providing the service.
Clause 740: Material not available for public inspection
1323. This clause sets out a number of exceptions to the above rights to inspect and copy material on the register. These are listed in subsections (1)(a)-(k) and include, for example, "protected information", i.e. information about directors' home addresses covered by Part 10, Chapter 8. Subsection (2) makes clear that the fact that certain material (for example, an address), which has been placed on the register as a result of the filing of two or more different types of document, is confidential in one of those contexts, does not mean that it cannot be made public in its other context.
Clause 741: Application to registrar to make address unavailable for public inspection
1324. This clause is a new provision. It confers power on the Secretary of State to make regulations providing for applications to remove addresses from the public record held by Companies House. The regulations will set out the details of who can apply and on what grounds and the procedure involved. They are to be subject to the affirmative resolution procedure.
Clause 742: Form of application for inspection or copy
Clause 743: Form and manner in which copies to be provided
Clause 744: Certification of copies as accurate
1325. These clauses enable the registrar to specify the form and manner in which applications for inspection of the register, or for copies of material on it, must be made, and to determine the form and manner in which copies are provided. They are subject to important exceptions, arising from the amended First Company Law Directive (68/151/EEC), in respect of the documents listed at clause 731. Clause 742(2) makes clear that applications must be capable of being submitted in hard copy or in electronic form, as the applicant chooses. Clause 743(2) similarly makes clear that the applicant is entitled to insist on receiving the copies themselves in hard copy or in electronic form (subject to an exception in respect of documents delivered before 1 January 2007).
1326. Clause 744, again responding to provisions of the amended First Company Law Directive (68/151/EEC), makes clear that, unless the applicant chooses otherwise, copies of information provided in hard copy must be certified as true copies; but electronic copies must not be so certified. Subsection (3) provides for the evidential status of certified hard copies in legal proceedings. The Secretary of State will have a power to prescribe by regulations methods of certification for copies provided by electronic means.
Clause 745: Issue of process for production of records kept by the registrar
1327. This clause restates section 709(5) of the 1985 Act and provides that no-one can take proceedings against the registrar for production of records without first obtaining the permission of the court.
Correction or removal of material on the register
Clause 746: Registrar's notice to resolve inconsistency on the register
1328. This clause enables the registrar to notify a company of an apparent inconsistency in the information on the register. An example might be where a document is received notifying the removal of a director where there is no record of his appointment. In such circumstances, the registrar may give notice to the company requiring them to resolve the inconsistency within 14 days by providing additional or replacement documents. Failure to do so on the company's part will be an offence (subsection (3)).
Clause 747: Administrative removal of material from the register
1329. The registrar will have a power to remove from the register information which she had a power but no duty to enter. Under subsection (4), the registrar will need to send a notice to the presenter of the information in question, or to the company to which the material relates, on or before removing the material.
1330. The registrar will not however be able to remove information from the register where registration has had legal consequences for the company as regards certain key events, as set out in subsection (3), including for example its formation or a change of registered office.
Clause 748: Rectification of register on application to registrar
1331. This clause gives the Secretary of State a power to make regulations under which, following a successful application, the registrar will be required to remove certain kinds of material from the register. The procedure may only cover certain types of document. It will operate in respect of material that derives from something that is invalid or ineffective or from something that was done without the authority of the company (this would cover forms filed without authority); and material that is factually inaccurate or forged or derives from something which is factually inaccurate or forged.
1332. The registrar will only act as a result of an application, and regulations will specify such issues as who may make the application, what information will need to be provided with it, and so on. Where the material which is removed is of a kind whose registration has had legal consequences, subsection (5) provides that interested parties will have the right to go to court to obtain an order as to the material's legal effect.
Clause 749: Rectification of the register under court order
1333. The registrar will also be required to remove material from the register where there is a court order to that effect. The court's rectification power will operate in the same circumstances as the registrar's power following regulations made under clause 748 above. However, the court's power will be of general application. For example, there will be no limit on the types of document covered. The court will be able to make an order to remove material from the register where its presence on the register has caused damage or may cause damage to the company and the company's interests in removing the material outweigh the interests of others in it continuing to be on the register. The court will be able to make such consequential orders as appear just regarding the period that the information was on the register and the effect of the information being on the register during that period. The court's rectification power will not operate where the court has other rectification powers (e.g. in relation to accounts or charges).
Clause 750: Powers of court on ordering removal of material from the register
1334. This clause provides that where a court decides that certain information should be removed from the public register, the court may also make directions as to annotations (removing notes that are already there or directing that now new notes appear as a result of its order - or that notes appear in a restricted form) and as to whether its own order should be available for public inspection.
Clause 751: Public notice of removal of certain material from the register
1335. Clause 730 provides for the registrar to give public notice that she has received certain documents relating to a company in the Gazette or through some other form of publication. This clause creates the corresponding obligation for her to give notice where she removes such material.
The registrar's index of company names
Clause 752: The registrar's index of company names
1336. This clause replaces and updates section 714 of the 1985 Act. It provides for the registrar of companies to keep an index of the names not only of companies incorporated under Companies Acts but also of business entities formed under other legislation and overseas companies with a UK branch or place of business.
1337. This clause also provides power for regulations to update the categories of business entities that are included in the index.
Clause 753: Right to inspect index
1338. This clause retains the public right to inspect the index (it can be searched online, without charge, at www.companieshouse.gov.uk). The index of company names is important not only as the means of access to the information on the public record of companies incorporated in Great Britain but also as the list of names with which every proposed new name is compared to ensure that the public is not confused by the simultaneous appearance on the register of two names that are very similar.
Clause 754: Power to amend enactments relating to bodies other than companies
1339. This clause provides power for the Secretary of State to amend the rules for the names that can be adopted by other business entities on the index of company names (see clause 752). Each category of business entity is subject to its own rules which include various safeguards to minimise the risk of public confusion. These rules differ from those that apply to companies in particular as regards the adoption of a name the same or very similar to one already on the index. This lack of reciprocity is a weakness of the existing system which this clause provides power to address.
Language requirements: translation
Clause 755: Application of language requirements
Clause 756: Documents to be drawn up and delivered in English
1340. These clauses set out language requirements. Clause 756 sets out the general rule that all documents must be in English (subject to the exceptions in the following clauses). Clause 755 provides that this general rule, and its exceptions, applies automatically to documents required under the Companies Acts and Insolvency Act 1986 (and its Northern Ireland equivalent).
1341. There are however a variety of other pieces of legislation which may require companies in certain circumstances to supply material to the registrar. Depending on the nature of the particular requirement and its origin (for example, whether it responds to European law), it may or may not be appropriate to apply the language provisions of this Bill unchanged to such material. Clause 755(2) therefore enables the Secretary of State to make regulations to set out detailed provisions covering non-Companies Act requirements.
Clause 757: Documents relating to Welsh companies
1342. This clause provides an exception to the general rule in clause 756: that documents relating to Welsh companies may be drawn up and filed in Welsh (and sometimes only in Welsh). It replaces, without any substantive change, section 710B of the 1985 Act.
Clause 758: Documents that may be drawn up and delivered in other languages
1343. This clause sets out the circumstances in which documents may be drawn up and filed in other languages, but requires them to be accompanied by a certified translation into English. These documents are listed in subsection (2): agreements affecting the company's constitution, documents relating to group accounts for companies in a group, and instruments relating to company charges. For some companies, documents of these sorts may well originate in languages other than English, and there may be an interest in ensuring that the original version is registered with the registrar. Subsection (2)(d) also allows the Secretary of State to extend the categories of documents to which this clause applies.
Clause 759: Voluntary filing of translations
1344. The main purpose of this clause is to implement aspects of the amended First Company Law Directive (68/151/EEC). It provides that companies may send the registrar certified translations of documents relating to the company, and subsection (2) enables the Secretary of State to set out in regulations those languages and documents in relation to which this facility is available. Subsection (3) provides that these regulations must as a minimum specify the official languages of the EU, and the documents covered by the amended First Company Law Directive (68/151/EEC) (see clause 731), to ensure compliance with that directive. However, other languages (and categories of document) may be covered by regulations.
Clause 760: Certified translations
1345. This clause provides that a "certified translation" is one which has been certified in a manner prescribed by the registrar. It also makes clear that, where there is a discrepancy between an original and a translation, the company may not rely on the translation as against a third party, but the third party may rely on the translation (unless the company can show that the third party had knowledge of the original). This implements article 3a.4 of the amended First Company Law Directive (68/151/EEC).
Language requirements: transliteration
Clause 761: Transliteration of names and addresses: permitted characters
1346. This clause is a new provision. It deals with the possibility that the name and address of a director or of an overseas company may use a character set (for example, that of Urdu or Japanese) which is different from those with which the bulk of Companies House's users are familiar. This clause restricts the characters that are permitted for names and addresses in a document delivered to the registrar to those specified in regulations. The regulations, which are subject to negative resolution procedure, may also provide for names and addresses to be delivered in their original form.
Clause 762: Transliteration of names and addresses: voluntary transliteration into Roman characters
1347. This clause is a new provision. It provides for the possibility that the Regulations made under clause 761 may permit letters and characters that are not drawn from the Roman alphabet, for example Greek letters. The requirement for transliteration under that clause will not apply to names using such letters and characters. This clause permits these names to be transliterated provided that certain requirements are met.
Clause 763: Transliteration of names and addresses: certification
1348. This clause is a new provision. It confers power on the Secretary of State to make regulations relating to transliteration of names and addresses. The regulations may distinguish between compulsory transliteration under clause 761 and voluntary under clause 762.
Supplementary provisions
Clause 764: General false statement offence
1349. This clause provides for a new offence of knowingly or recklessly delivering to the registrar information which is misleading, false or deceptive in a material particular. It responds to a recommendation of the CLR (Final Report, paragraph 11.48). This new general offence makes it unnecessary to reproduce specific offences covering false information or false statements in respect of specific legislative requirements that were a feature of the 1985 Act.
Clause 765: Enforcement of company's filing obligations
1350. This clause (which restates section 713 of the 1985 Act) provides the mechanism for ensuring that companies can be compelled to comply with their obligations to file documents or give notices to the registrar. Where a company has defaulted on an obligation, the registrar herself, any member of the company, or any creditor, may serve a notice on the company requiring it to file. If the company continues the breach after 14 days, the applicant may apply to the court for an order requiring the company, or any specified officer of it, to make good the default. The court order may ensure that costs are borne by the company or its officers. Subsection (5) provides that this process is separate to any specific offence and penalty that may relate to the original requirement and the company's failure to carry it out.
Clause 766: Application of provisions about documents and delivery
1351. This clause, which replaces section 715A of the 1985 Act, provides that "document" means information recorded in any form, and that "delivering" a document includes forwarding, lodging, registering, producing or submitting it, or giving a notice. It also makes it clear that requirements relating to "documents" also apply (unless otherwise provided for) to information passed to the registrar in some other way. This caters for the possibility that information may not be "recorded" in any form, for example (arguably) when it is sent via a website.
Clause 767: Provisions requiring copies of court orders to be delivered to the registrar
1352. This clause substitutes the word "copy" for the phrase "office copy" in certain pieces of legislation (thus ensuring that electronic as well as paper copies satisfy the legislative requirements).
Clause 768: Supplementary provisions relating to electronic communications
1353. This clause (which replaces section 710A of the 1985 Act) allows the registrar to require those who choose to file electronically to accept electronic communications from the registrar. It also makes clear that, where a document is required to be "signed" by the registrar, or authenticated by seal, she may determine by rules how it is to be authenticated when it is in fact sent by electronic means.
Clause 769: Alternative to publication in the Gazette
1354. The registrar is currently required to publish certain statutory notices in the Gazette. The objective is to ensure that such notices are well-publicised and made available to all those who might wish to take notice of them. The Gazette is a long-established and well-understood mechanism for ensuring such publicity. However, it is possible that developments, in particular in electronic publishing, will mean over time that alternative mechanisms are equally or more appropriate as ways of meeting the underlying policy objective. The CLR envisaged that the registrar should be able to make use of such mechanisms (Final Report, paragraph 11.48). This clause therefore provides a power for the Secretary of State to specify alternative means which the registrar may then approve for use. To ensure that any such change is itself
well-publicised in advance, subsection (5) provides that the change must itself be announced in the Gazette.
1355. Subsection (6) makes clear that some other mechanism may be in addition to the continuing use of the Gazette.
Clause 770: Registrar's rules
1356. Other provisions in this Part enable the registrar to impose requirements in relation to certain matters. For example, clause 721 enables the registrar to specify the form, authentication and manner of delivery of documents to her; and clause 726 similarly enables her to determine the form and manner of any company instructions as to informal correction of the register. This clause provides that the registrar may set out these requirements in registrar's rules. Such rules can make different provision for different cases, and may allow her to modify or disapply the rules. This clause also ensures that the registrar must publicise any such rules in a way designed to make sure that those who will need to know about them get to hear of them (which might in practice, for example, be by using the Companies House website); and must make copies of the rules publicly available.
Clause 771: Payments into the Consolidated Fund
1357. This clause ensures that nothing in this or other companies legislation affects the continued operation in relation to the registrar of the Government Trading Funds Act. (Companies House is and remains a Trading Fund.)
Clause 772: Contracting out of registrar's functions
1358. This clause largely restates subsections (7) and (8) of section 704 of the 1985 Act. The Deregulation and Contracting Out Act 1994 envisages that some of the registrar's functions may be contracted out. This clause provides for this possibility by saying that where a contractor is processing documents the registrar can provide for them to be sent directly to the contractor.
1359. The Deregulation and Contracting Out Act 1994 does not permit the function of making subordinate legislation to be delegated. Subsection (3) provides that registrar's rules are not regarded as subordinate legislation for this purpose, permitting the contractor to make rules about form and manner of delivery, for example.
Clause 773: Application of Part to overseas companies
1360. This clause provides that, except where the context otherwise requires, the provisions of this Part of the Bill apply equally to overseas companies.
PART 30: OFFENCES UNDER THE COMPANIES ACTS
1361. The CLR sought to draw out the basis on which criminal liability for a breach of Companies Act requirements is allocated under existing legislation to companies and to officers of companies. They stated in their final report that a reformed Companies Act must be underpinned by effective and proportionate sanctions and enforcement.
1362. The key changes in the Bill are:
- refinements to the "officer in default" framework to make it clearer which individuals in which circumstances may be liable for a breach; and
- removal of criminal liability from the company itself in certain circumstances.
1363. The general principle adopted as to whether a company should be liable for a breach of the requirements of Companies Acts is that where the only victims of the offence are the company or its members, the company should not be liable for the offence. On the other hand, where members or the company are potential victims, but not the only ones, then the company should be potentially liable for a breach.
1364. All the offences in the Companies Acts, both those in the Bill and those that remain in the 1985 Act, have been reviewed in the light of this principle.
Liability of officer in default
Clause 774: Liability of officer in default
1365. This clause specifies which persons may be liable as an officer of a company for an offence committed by the company under the Bill or the other Companies Acts.
1366. An "officer" of a company is defined as including a director, manager or (company) secretary, and any person who is to be treated as an officer of the company for the purposes of the provisions in question. An officer is liable for an offence when he is "in default", meaning he authorises or permits, participates in, or fails to take all reasonable steps to prevent the offence being committed.
Clause 775: Liability of company as officer in default
1367. Under this provision, where a company is an officer of another company, liability for a breach of company law can be fixed upon the company as an officer only if one of its officers is in default.
Clause 776: Application to bodies other than companies
1368. This clause provides that clause 774 applies to persons in bodies other than companies where their role is equivalent to that of an officer of a company. It makes specific provisions for bodies corporate, partnerships and unincorporated bodies.
| 
