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S.C.D.  Standing Committee Proceedings: 20th July 2006            

619

 

Company Law Reform Bill[ [], continued

 
 

Margaret Hodge

 

Added  NS1

 

To move the following Schedule:—

 

 

Meaning of “subsidiary” etc: supplementary provisions

 

Introduction

 

1          

The provisions of this Part of this Schedule explain expressions used in section

 

(Meaning of “subsidiary” etc) (meaning of “subsidiary” etc) and otherwise

 

supplement that section.

 

Voting rights in a company

 

2          

In section (Meaning of “subsidiary” etc)(1)(a) and (c) the references to the

 

voting rights in a company are to the rights conferred on shareholders in

 

respect of their shares or, in the case of a company not having a share capital,

 

on members, to vote at general meetings of the company on all, or substantially

 

all, matters.

 

Right to appoint or remove a majority of the directors

 

3    (1)  

In section (Meaning of “subsidiary” etc)(1)(b) the reference to the right to

 

appoint or remove a majority of the board of directors is to the right to appoint

 

or remove directors holding a majority of the voting rights at meetings of the

 

board on all, or substantially all, matters.

 

      (2)  

A company shall be treated as having the right to appoint to a directorship if—

 

(a)    

a person’s appointment to it follows necessarily from his appointment

 

as director of the company, or

 

(b)    

the directorship is held by the company itself.

 

      (3)  

A right to appoint or remove which is exercisable only with the consent or

 

concurrence of another person shall be left out of account unless no other

 

person has a right to appoint or, as the case may be, remove in relation to that

 

directorship.

 

Rights exercisable only in certain circumstances or temporarily incapable of exercise

 

4    (1)  

Rights which are exercisable only in certain circumstances shall be taken into

 

account only—

 

(a)    

when the circumstances have arisen, and for so long as they continue

 

to obtain, or

 

(b)    

when the circumstances are within the control of the person having the

 

rights.

 

      (2)  

Rights which are normally exercisable but are temporarily incapable of

 

exercise shall continue to be taken into account.

 

Rights held by one person on behalf of another

 

5          

Rights held by a person in a fiduciary capacity shall be treated as not held by

 

him.

 

6    (1)  

Rights held by a person as nominee for another shall be treated as held by the

 

other.


 
 

S.C.D.  Standing Committee Proceedings: 20th July 2006            

620

 

Company Law Reform Bill[ [], continued

 
 

      (2)  

Rights shall be regarded as held as nominee for another if they are exercisable

 

only on his instructions or with his consent or concurrence.

 

Rights attached to shares held by way of security

 

7          

Rights attached to shares held by way of security shall be treated as held by the

 

person providing the security—

 

(a)    

where apart from the right to exercise them for the purpose of

 

preserving the value of the security, or of realising it, the rights are

 

exercisable only in accordance with his instructions, and

 

(b)    

where the shares are held in connection with the granting of loans as

 

part of normal business activities and apart from the right to exercise

 

them for the purpose of preserving the value of the security, or of

 

realising it, the rights are exercisable only in his interests.

 

Rights attributed to holding company

 

8    (1)  

Rights shall be treated as held by a holding company if they are held by any of

 

its subsidiary companies.

 

      (2)  

Nothing in paragraph 6 or 7 shall be construed as requiring rights held by a

 

holding company to be treated as held by any of its subsidiaries.

 

      (3)  

For the purposes of paragraph 7 rights shall be treated as being exercisable in

 

accordance with the instructions or in the interests of a company if they are

 

exercisable in accordance with the instructions of or, as the case may be, in the

 

interests of—

 

(a)    

any subsidiary or holding company of that company, or

 

(b)    

any subsidiary of a holding company of that company.

 

Disregard of certain rights

 

9          

The voting rights in a company shall be reduced by any rights held by the

 

company itself.

 

Supplementary

 

10         

References in any provision of paragraphs 5 to 9 to rights held by a person

 

include rights falling to be treated as held by him by virtue of any other

 

provision of those paragraphs but not rights which by virtue of any such

 

provision are to be treated as not held by him.’.

 


 

Clauses 813 and 814 Agreed to.

 


 

Margaret Hodge

 

Agreed to  114

 

Schedule  9,  page  509,  line  17,  at end insert—

 

‘authorised signatory

section (Authorised signatories)’.

 

 
 

S.C.D.  Standing Committee Proceedings: 20th July 2006            

621

 

Company Law Reform Bill[ [], continued

 
 

Margaret Hodge

 

Agreed to  453

 

Schedule  9,  page  512,  leave out line 22.

 

Margaret Hodge

 

Agreed to  454

 

Schedule  9,  page  517,  line  22,  at end insert—

 

‘small companies regime, for accounts and reports

section 363’.

 
 

Margaret Hodge

 

Agreed to  115

 

Schedule  9,  page  514,  line  32,  leave out ‘section 362 of the 1985 Act’ and insert

 

‘section (Overseas branch registers)(1)’.

 

Margaret Hodge

 

Agreed to  310

 

Schedule  9,  page  515,  line  36,  at end insert—

 

‘qualifying pension scheme indemnity

section (Qualifying pension scheme

 
 

provision (in Chapter 7 of Part 10)

indemnity provision)’.

 
 

Schedule, as amended, Agreed to.

 

Clauses 815 to 820 and 920 Agreed to.

 


 

Mr Jonathan Djanogly

 

Mr Crispin Blunt

 

James Brokenshire

 

Not called  353

 

Schedule  16,  page  543,  line  30,  at end insert ‘in section 153(3)(d), the words “or

 

purchase”.’.

 

Schedule Agreed to.

 


 

Margaret Hodge

 

Agreed to  524

 

Title,  line  3,  after ‘about’ insert ‘directors’ disqualification,’.

 

Bill, as amended, to be reported.

 


 
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