|
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| |
| |
|
| | (b) | carried out in accordance with a requirement imposed under section 166 |
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| | |
| | | by an actuary appointed as actuary to the company. |
|
| | (7) | In this section “long term business” means business that consists of effecting or |
|
| | carrying out contracts of long term insurance. |
|
| | | This definition must be read with section 22 of the Financial Services and |
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| | Markets Act 2000 (c. 8), any relevant order under that section and Schedule 2 to |
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| | |
| |
| | Treatment of development costs |
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| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | Where development costs are shown as an asset in a company’s accounts, any |
|
| | amount shown in respect of those costs is treated— |
|
| | (a) | for the purposes of section (Distributions to be made only out of profits |
|
| | available for the purpose) (distributions to be made out of profits |
|
| | available for the purpose) as a realised loss, and |
|
| | (b) | for the purposes of section (Distributions by investment companies out of |
|
| | accumulated revenue profits) (distributions by investment companies out |
|
| | of accumulated revenue profits) as a realised revenue loss. |
|
| | | This is subject to the following exceptions. |
|
| | (2) | Subsection (1) does not apply to any part of that amount representing an |
|
| | unrealised profit made on revaluation of those costs. |
|
| | (3) | Subsection (1) does not apply if— |
|
| | (a) | there are special circumstances in the company’s case justifying the |
|
| | directors in deciding that the amount there mentioned is not to be treated |
|
| | as required by subsection (1), |
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| | |
| | (i) | in the case of Companies Act accounts, in the note required by |
|
| | regulations under section 378 as to the reasons for showing |
|
| | development costs as an asset, or |
|
| | (ii) | in the case of IAS accounts, in any note to the accounts, |
|
| | | that the amount is not to be so treated, and |
|
| | (c) | the note explains the circumstances relied upon to justify the decision of |
|
| | the directors to that effect.’. |
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| |
|
|
| |
| |
|
| | Distributions in kind: determination of amount |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | This section applies for determining the amount of a distribution consisting of or |
|
| | including, or treated as arising in consequence of, the sale, transfer or other |
|
| | disposition by a company of a non-cash asset where— |
|
| | (a) | at the time of the distribution the company has profits available for |
|
| | |
| | (b) | if the amount of the distribution were to be determined in accordance |
|
| | with this section, the company could make the distribution without |
|
| | |
| | (2) | The amount of the distribution (or the relevant part of it) is taken to be— |
|
| | (a) | in a case where the amount or value of the consideration for the disposal |
|
| | is not less than the book value of the asset, zero; |
|
| | (b) | in any other case, the amount by which the book value of the asset |
|
| | exceeds the amount or value of any consideration for the disposal. |
|
| | (3) | The company’s profits available for distribution are treated as increased by the |
|
| | amount (if any) by which the amount or value of any consideration for the |
|
| | disposition exceeds the book value of the asset. |
|
| | (4) | In this section “book value”, in relation to an asset, means— |
|
| | (a) | the amount at which the asset is stated in the relevant accounts, or |
|
| | (b) | where the asset is not stated in those accounts at any amount, zero. |
|
| | (5) | The provisions of Chapter (Justification of distribution by reference to accounts) |
|
| | (justification of distribution by reference to accounts) have effect subject to this |
|
| | |
| |
| | Distributions in kind: treatment of unrealised profits |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | This section applies where— |
|
| | (a) | a company makes a distribution consisting of or including, or treated as |
|
| | arising in consequence of, the sale, transfer or other disposition by the |
|
| | company of a non-cash asset, and |
|
| | (b) | any part of the amount at which that asset is stated in the relevant |
|
| | accounts represents an unrealised profit. |
|
| | (2) | That profit is treated as a realised profit— |
|
| | (a) | for the purpose of determining the lawfulness of the distribution in |
|
| | accordance with this Part (whether before or after the distribution takes |
|
| | |
| | (b) | for the purpose of the application, in relation to anything done with a |
|
| | view to or in connection with the making of the distribution, of any |
|
|
|
| |
| |
|
| | provision of regulations under section 378 under which only realised |
|
| | profits are to be included in or transferred to the profit and loss account.’. |
|
| |
| | Consequences of unlawful distribution |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | This section applies where a distribution, or part of one, made by a company to |
|
| | one of its members is made in contravention of this Part. |
|
| | (2) | If at the time of the distribution the member knows or has reasonable grounds for |
|
| | believing that it is so made, he is liable— |
|
| | (a) | to repay it (or that part of it, as the case may be) to the company, or |
|
| | (b) | in the case of a distribution made otherwise than in cash, to pay the |
|
| | company a sum equal to the value of the distribution (or part) at that time. |
|
| | (3) | This is without prejudice to any obligation imposed apart from this section on a |
|
| | member of a company to repay a distribution unlawfully made to him. |
|
| | (4) | This section does not apply in relation to— |
|
| | (a) | financial assistance given by a company in contravention of section |
|
| | (Assistance for acquisition of shares in public company) or (Assistance |
|
| | by public company for acquisition of shares in its private holding |
|
| | |
| | (b) | any payment made by a company in respect of the redemption or |
|
| | purchase by the company of shares in itself. |
|
| |
| | Saving for certain older provisions in articles |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | Where immediately before the relevant date a company was authorised by a |
|
| | provision of its articles to apply its unrealised profits in paying up in full or in part |
|
| | unissued shares to be allotted to members of the company as fully or partly paid |
|
| | bonus shares, that provision continues (subject to any alteration of the articles) as |
|
| | authority for those profits to be so applied after that date. |
|
| | (2) | For this purpose the relevant date is— |
|
| | (a) | for companies registered in Great Britain, 22nd December 1980; |
|
| | (b) | for companies registered in Northern Ireland, 1st July 1983.’. |
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| |
|
|
| |
| |
|
| | Restriction on application of unrealised profits |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘A company must not apply an unrealised profit in paying up debentures or any |
|
| | amounts unpaid on its issued shares.’. |
|
| |
| | Treatment of certain older profits or losses |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | Where the directors of a company are, after making all reasonable enquiries, |
|
| | unable to determine whether a particular profit made before the relevant date is |
|
| | realised or unrealised, they may treat the profit as realised. |
|
| | (2) | Where the directors of a company, after making all reasonable enquiries, are |
|
| | unable to determine whether a particular loss made before the relevant date is |
|
| | realised or unrealised, they may treat the loss as unrealised. |
|
| | (3) | For the purposes of this section the relevant date is— |
|
| | (a) | for companies registered in Great Britain, 22nd December 1980; |
|
| | (b) | for companies registered in Northern Ireland, 1st July 1983.’. |
|
| |
| | Application of rules of law restricting distributions |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | Except as provided in this section, the provisions of this Part are without |
|
| | prejudice to any rule of law restricting the sums out of which, or the cases in |
|
| | which, a distribution may be made. |
|
| | (2) | For the purposes of any rule of law requiring distributions to be paid out of profits |
|
| | or restricting the return of capital to members— |
|
| | (a) | section (Distributions in kind: determination of amount) (distributions in |
|
| | kind: determination of amount) applies to determine the amount of any |
|
| | distribution or return of capital consisting of or including, or treated as |
|
| | arising in consequence of the sale, transfer or other disposition by a |
|
| | company of a non-cash asset; and |
|
| | (b) | section (Distributions in kind: treatment of unrealised profits) |
|
| | (distributions in kind: treatment of unrealised profits) applies as it applies |
|
| | for the purposes of this Part. |
|
|
|
| |
| |
|
| | (3) | In this section references to distributions are to amounts regarded as distributions |
|
| | for the purposes of any such rule of law as is referred to in subsection (1).’. |
|
| |
| | Saving for other restrictions on distributions |
|
| |
| | |
| 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.’. |
|
| |
| | |
| |
| | |
| 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 |
|
| | |
| | (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 |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | The Secretary of State may by regulations modify the provisions of this Part. |
|
| | |
| | (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 |
|
| |
| | |
| 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— |
|
| | |
| | (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 |
|
| |
| | |
| 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 |
|
| | |
| | (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 |
|
| | |
| | (a) | any patent, trade mark, registered design, copyright or design right; |
|
| | (b) | any licence under or in respect of any such right. |
|
| | |
| | “charge” includes mortgage, and |
|
| | “company” means a company registered in England and Wales or in |
|
| | |
| |
| | Charges existing on property acquired |
|
| |
| | |
| 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 |
|
| | |
| | (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 |
|
| | |
| | (4) | If default is made in complying with this section, an offence is committed by— |
|
| | |
| | (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 |
|
|