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Company Law Reform Bill [HL] (683-689)


Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 13 — Supplementary provisions with respect to delegation order

683

 

Name, members and chairman

3     (1)  

The body is to be known by such name as may be specified in the delegation

order.

      (2)  

The body is to consist of such persons (not being less than eight) as the

Secretary of State may appoint after such consultation as he thinks

5

appropriate.

      (3)  

The chairman of the body is to be such person as the Secretary of State may

appoint from among its members.

      (4)  

The Secretary of State may make provision by order as to—

(a)   

the terms on which the members of the body are to hold and vacate

10

office;

(b)   

the terms on which a person appointed as chairman is to hold and

vacate the office of chairman.

Financial provisions

4     (1)  

The body must pay to its chairman and members such remuneration, and

15

such allowances in respect of expenses properly incurred by them in the

performance of their duties, as the Secretary of State may determine.

      (2)  

As regards any chairman or member in whose case the Secretary of State so

determines, the body must pay or make provision for the payment of—

(a)   

such pension, allowance or gratuity to or in respect of that person on

20

his retirement or death, or

(b)   

such contributions or other payment towards the provision of such a

pension, allowance or gratuity,

           

as the Secretary of State may determine.

      (3)  

Where—

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(a)   

a person ceases to be a member of the body otherwise than on the

expiry of his term of office, and

(b)   

it appears to the Secretary of State that there are special

circumstances which make it right for that person to receive

compensation,

30

           

the body must make a payment to him by way of compensation of such

amount as the Secretary of State may determine.

Proceedings

5     (1)  

The delegation order may contain such provision as the Secretary of State

considers appropriate with respect to the proceedings of the body.

35

      (2)  

The delegation order may, in particular—

(a)   

authorise the body to discharge any functions by means of

committees consisting wholly or partly of members of the body;

(b)   

provide that the validity of proceedings of the body, or of any such

committee, is not affected by any vacancy among the members or

40

any defect in the appointment of any member.

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 13 — Supplementary provisions with respect to delegation order

684

 

Fees

6     (1)  

The body may retain fees payable to it.

      (2)  

The fees must be applied for—

(a)   

meeting the expenses of the body in discharging its functions, and

(b)   

any purposes incidental to those functions.

5

      (3)  

Those expenses include any expenses incurred by the body on such staff,

accommodation, services and other facilities as appear to it to be necessary

or expedient for the proper performance of its functions.

      (4)  

In prescribing the amount of fees in the exercise of the functions transferred

to it the body must prescribe such fees as appear to it sufficient to defray

10

those expenses, taking one year with another.

      (5)  

Any exercise by the body of the power to prescribe fees requires the

approval of the Secretary of State.

      (6)  

The Secretary of State may, after consultation with the body, by order vary

or revoke any regulations prescribing fees made by the body.

15

Legislative functions

7     (1)  

Regulations or an order made by the body in the exercise of the functions

transferred to it must be made by instrument in writing, but not by statutory

instrument.

      (2)  

The instrument must specify the provision of this Part of this Act under

20

which it is made.

      (3)  

The Secretary of State may by order impose such requirements as he thinks

necessary or expedient as to the circumstances and manner in which the

body must consult on any regulations or order it proposes to make.

      (4)  

Nothing in this Part applies to make regulations or an order made by the

25

body subject to negative resolution procedure or affirmative resolution

procedure.

8     (1)  

Immediately after an instrument is made it must be printed and made

available to the public with or without payment.

      (2)  

A person is not to be taken to have contravened any regulation or order if he

30

shows that at the time of the alleged contravention the instrument

containing the regulation or order had not been made available as required

by this paragraph.

9     (1)  

The production of a printed copy of an instrument purporting to be made by

the body on which is endorsed a certificate signed by an officer of the body

35

authorised by it for the purpose and stating—

(a)   

that the instrument was made by the body,

(b)   

that the copy is a true copy of the instrument, and

(c)   

that on a specified date the instrument was made available to the

public as required by paragraph 8,

40

           

is evidence (or, in Scotland, sufficient evidence) of the facts stated in the

certificate.

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 13 — Supplementary provisions with respect to delegation order

685

 

      (2)  

A certificate purporting to be signed as mentioned in sub-paragraph (1) is to

be deemed to have been duly signed unless the contrary is shown.

      (3)  

Any person wishing in any legal proceedings to cite an instrument made by

the body may require the body to cause a copy of it to be endorsed with such

a certificate as is mentioned in this paragraph.

5

Report and accounts

10    (1)  

The body must, at least once in each calendar year for which the delegation

order is in force, make a report to the Secretary of State on—

(a)   

the discharge of the functions transferred to it, and

(b)   

such other matters as the Secretary of State may by order require.

10

      (2)  

The delegation order may modify subsection (1) as it has effect in relation to

the calendar year in which the order comes into force or is revoked.

      (3)  

The Secretary of State must lay before Parliament copies of each report

received by him under this paragraph.

      (4)  

The following provisions of this paragraph apply as follows—

15

(a)   

sub-paragraphs (5) and (6) apply only where the body is established

by the order, and

(b)   

sub-paragraphs (7) and (8) apply only where the body is an existing

body.

      (5)  

The Secretary of State may, with the consent of the Treasury, give directions

20

to the body with respect to its accounts and the audit of its accounts.

      (6)  

A person may only be appointed as auditor of the body if he is eligible for

appointment as a statutory auditor.

      (7)  

Unless the body is a company to which section 226 of the Companies Act

1985 (c. 6) (duty to prepare individual company accounts) applies, the

25

Secretary of State may, with the consent of the Treasury, give directions to

the body with respect to its accounts and the audit of its accounts.

      (8)  

Whether or not the body is a company to which section 226 of the

Companies Act 1985 applies, the Secretary of State may direct that any

provisions of that Act specified in the directions are to apply to the body,

30

with or without any modifications so specified.

Other supplementary provisions

11    (1)  

The transfer of a function to a body designated by a delegation order does

not affect anything previously done in the exercise of the function

transferred; and the resumption of a function so transferred does not affect

35

anything previously done in exercise of the function resumed.

      (2)  

The Secretary of State may by order make such transitional and other

supplementary provision as he thinks necessary or expedient in relation to

the transfer or resumption of a function.

      (3)  

The provision that may be made in connection with the transfer of a function

40

includes, in particular, provision—

(a)   

for modifying or excluding any provision of this Part of this Act in its

application to the function transferred;

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 14 — Statutory auditors: consequential amendments

686

 

(b)   

for applying to the body designated by the delegation order, in

connection with the function transferred, any provision applying to

the Secretary of State which is contained in or made under any other

enactment;

(c)   

for the transfer of any property, rights or liabilities from the Secretary

5

of State to that body;

(d)   

for the carrying on and completion by that body of anything in the

process of being done by the Secretary of State when the order takes

effect;

(e)   

for the substitution of that body for the Secretary of State in any

10

instrument, contract or legal proceedings.

      (4)  

The provision that may be made in connection with the resumption of a

function includes, in particular, provision—

(a)   

for the transfer of any property, rights or liabilities from that body to

the Secretary of State;

15

(b)   

for the carrying on and completion by the Secretary of State of

anything in the process of being done by that body when the order

takes effect;

(c)   

for the substitution of the Secretary of State for that body in any

instrument, contract or legal proceedings.

20

12         

Where a delegation order is revoked, the Secretary of State may by order

make provision—

(a)   

for the payment of compensation to persons ceasing to be employed

by the body established by the delegation order;

(b)   

as to the winding up and dissolution of the body.

25

13    (1)  

This paragraph applies where the body is an unincorporated association.

      (2)  

Any relevant proceedings may be brought by or against the body in the

name of any body corporate whose constitution provides for the

establishment of the body.

      (3)  

In sub-paragraph (2) “relevant proceedings” means proceedings brought in

30

or in connection with the exercise of any transferred function.

      (4)  

In relation to proceedings brought as mentioned in sub-paragraph (2), any

reference in paragraph 11(3)(e) or (4)(c) to the body replacing or being

replaced by the Secretary of State in any legal proceedings is to be read with

the appropriate modifications.

35

Schedule 14

Section 1228

 

Statutory auditors: consequential amendments

Companies (Audit, Investigations and Community Enterprise) Act 2004 (c. 27)

1     (1)  

Section 16 of the Companies (Audit, Investigations and Community

Enterprise) Act 2004 (grants to bodies concerned with accounting standards

40

etc) is amended as follows.

      (2)  

In subsection (2)—

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 15 — Transparency obligations and related matters: minor and consequential amendments
Part 1 — Amendments of the Financial Services and Markets Act 2000

687

 

(a)   

in paragraph (f) for “paragraph 17” to the end substitute “paragraph

21, 22, 23(1) or 24(1) of Schedule 10 to the Company Law Reform Act

2006;”,

(b)   

in paragraph (g) for “Part 2 of that Act” substitute “Part 42 of that

Act”.

5

      (3)  

In subsection (5), in the definition of “professional accountancy body”—

(a)   

in paragraph (a) for “Part 2 of the Companies Act 1989 (c. 40)”

substitute “Part 42 of the Company Law Reform Act 2006”, and

(b)   

in paragraph (b) for “section 32” substitute “section 1184”.

Schedule 15

10

Section 1236

 

Transparency obligations and related matters: minor and consequential

amendments

Part 1

Amendments of the Financial Services and Markets Act 2000

1          

Part 6 of the Financial Services and Markets Act 2000 (listing and other

15

matters) is amended as follows.

2          

In section 73 (general duty of competent authority), after subsection (1)

insert—

“(1A)   

To the extent that those general functions are functions under or

relating to transparency rules, subsection (1)(c) and (f) have effect as

20

if the references to a regulated market were references to a market.”

3          

In section 73A (Part 6 Rules), after subsection (5) insert—

“(6)   

Transparency rules and corporate governance rules are not listing

rules, disclosure rules or prospectus rules, but are Part 6 rules.”

4          

For the cross-heading before section 90 substitute “Compensation for false or

25

misleading statements etc”.

5          

For the heading to section 90 substitute “Compensation for statements in

listing particulars or prospectus”.

6     (1)  

Section 91 (penalties for breach of Part 6 rules) is amended as follows.

      (2)  

For subsection (1) substitute—

30

“(1)   

If the competent authority considers that—

(a)   

an issuer of listed securities, or

(b)   

an applicant for listing,

   

has contravened any provision of listing rules, it may impose on him

a penalty of such amount as it considers appropriate.

35

(1ZA)   

If the competent authority considers that—

(a)   

an issuer who has requested or approved the admission of a

financial instrument to trading on a regulated market,

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 15 — Transparency obligations and related matters: minor and consequential amendments
Part 1 — Amendments of the Financial Services and Markets Act 2000

688

 

(b)   

a person discharging managerial responsibilities within such

an issuer, or

(c)   

a person connected with such a person discharging

managerial responsibilities,

   

has contravened any provision of disclosure rules, it may impose on

5

him a penalty of such amount as it considers appropriate.”

      (3)  

After subsection (1A) insert—

“(1B)   

If the competent authority considers—

(a)   

that a person has contravened—

(i)   

a provision of transparency rules or a provision

10

otherwise made in accordance with the transparency

obligations directive, or

(ii)   

a provision of corporate governance rules, or

(b)   

that a person on whom a requirement has been imposed

under section 89J (power to suspend or prohibit trading of

15

securities in case of infringement of applicable transparency

obligation), has contravened that requirement,

   

it may impose on the person a penalty of such amount as it considers

appropriate.”.

      (4)  

In subsection (2) for “(1)(a), (1)(b)(ii) or (1A)” substitute “(1), (1ZA)(a), (1A)

20

or (1B)”.

7          

In section 96B (persons discharging managerial responsibilities and

connected persons)—

(a)   

for the heading substitute “Disclosure rules: persons responsible for

compliance”;

25

(b)   

in subsection (1) for “For the purposes of this Part” substitute “for the

purposes of the provisions of this Part relating to disclosure rules”.

8          

In section 97(1) (appointment by the competent authority of persons to carry

out investigations), for paragraphs (a) and (b) substitute—

“(a)   

there may have been a contravention of—

30

(i)   

a provision of this Part or of Part 6 rules, or

(ii)   

a provision otherwise made in accordance with the

prospectus directive or the transparency obligations

directive;

(b)   

a person who was at the material time a director of a person

35

mentioned in section 91(1), (1ZA)(a), (1A) or (1B) has been

knowingly concerned in a contravention by that person of—

(i)   

a provision of this Part or of Part 6 rules, or

(ii)   

a provision otherwise made in accordance with the

prospectus directive or the transparency obligations

40

directive;”.

9          

In section 99 (fees) after subsection (1B) insert—

“(1C)   

Transparency rules may require the payment of fees to the

competent authority in respect of the continued admission of

financial instruments to trading on a regulated market.”.

45

 

 

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Schedule 15 — Transparency obligations and related matters: minor and consequential amendments
Part 2 — Amendments of the Companies (Audit, Investigations and Community Enterprise) Act 2004

689

 

10         

In section 102A(3) (meaning of “transferable securities”) for “the investment

services directive” substitute “Directive 2004/39/EC of the European

Parliament and of the Council on markets in financial instruments”.

11    (1)  

Section 103(1) (interpretation of Part 6) is amended as follows.

      (2)  

In the definition of “regulated market” for “Article 1.13 of the investment

5

services directive” substitute “Article 4.1(14) of Directive 2004/39/EC of the

European Parliament and of the Council on markets in financial

instruments”.

      (3)  

At the appropriate place insert—

““voteholder information” has the meaning given by section

10

89B(2);”.

Part 2

Amendments of the Companies (Audit, Investigations and Community

Enterprise) Act 2004

12         

Chapter 2 of Part 1 of the Companies (Audit, Investigations and Community

15

Enterprise) Act 2004 (accounts and reports) is amended as follows.

13    (1)  

Section 14 (supervision of periodic accounts and reports of issuers of listed

securities) is amended as follows.

      (2)  

In subsection (2)(a)—

(a)   

for “listed” substitute “transferable”;

20

(b)   

for “listing” substitute “Part 6”.

      (3)  

In subsection (3)(a)—

(a)   

for “listed” substitute “transferable”;

(b)   

for “listing” substitute “Part 6”.

      (4)  

In subsection (7)(b) for “listed” substitute “transferable”.

25

      (5)  

In subsection (12)—

(a)   

for ““listed securities” and “listing rules” have” substitute ““Part 6

rules” has”;

(b)   

for the definition of “issuer” substitute—

““issuer” has the meaning given by section 102A(6);”;

30

(c)   

in the definition of “periodic” for “listing” substitute “Part 6”;

(d)   

at the end add—

““transferable securities” has the meaning given by

section 102A(3) of that Act.”.

14    (1)  

Section 15 (application of certain company law provisions to bodies

35

appointed under section 14) is amended as follows.

      (2)  

In subsection (5)(a)—

(a)   

for “listed” substitute “transferable”;

(b)   

for “listing” substitute “Part 6”.

      (3)  

In subsection (5B)(a)—

40

(a)   

for “listed” substitute “transferable”;

(b)   

for “listing” substitute “Part 6”.

 

 

 
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