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Tuesday 17th October 2006 Consideration of Bill New Amendments handed in are marked thus * Company Law Reform Bill [Lords] Note The Amendments have been arranged in accordance with the Companies Bill [Lords] (Programme) (No. 3) to be proposed by Mr Secretary Darling. Mr Secretary Darling To move, That the Companies Bill [Lords] be considered in the following order: new Clauses relating to Chapter 2 of Part 10; Amendments relating to Chapter 2 of Part 10; new Clauses relating to Chapter 1 and Chapters 3 to 9 of Part 10; Amendments relating to Chapter 1 and Chapters 3 to 9 of Part 10; new Clauses relating to Part 11; Amendments relating to Part 11; new Clauses relating to Chapter 5 of Part 16; Amendments relating to Chapter 5 of Part 16; new Clauses relating to Chapters 1 to 4 and 6 to 12 of Part 16; Amendments relating to Chapters 1 to 4 and 6 to 12 of Part 16; new Clauses relating to Part 8; Amendments relating to Part 8; new Clauses relating to Part 12; Amendments relating to Part 12; new Clauses relating to Part 13; Amendments relating to Part 13; new Clauses relating to Part 4; Amendments relating to Part 4; new Clauses relating to Part 5; Amendments relating to Part 5; new Clauses relating to Part 15; Amendments relating to Part 15; new Clauses relating to Part 14; Amendments relating to Part 14; new Clauses relating to Part 44; Amendments relating to Part 44; Amendments relating to Clauses 521 to 523; new Clauses relating to Part 17; Amendments relating to Clauses 483 to 520 and 524 to 553; remaining new Clauses; remaining amendments to Clauses; new Schedules; amendments to Schedules; remaining proceedings on consideration.
new clause RELATING TO CHAPTER 2 OF PART 10 Duty to promote the success of the company (No. 2) Patrick Hall
NC4 To move the following Clause:— ‘(1) A director of a company must act in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole. (2) In fulfilling the duty imposed by this section, a director must endeavour to— (a) have regard to the likely consequences of any decision in the long term, (b) promote the interests of the company’s employees, (c) foster the company’s business relationships with suppliers, customers and others, (d) minimise any significant adverse impact of the company’s operations on the community and the environment, (e) maintain a reputation for high standards of business conduct and ethics, and (f) act fairly as between members of the company. (3) Where or to the extent that the purposes of the company consist of or include purposes other than the benefit of its members, subsection (1) has effect as if the reference to promoting the success of the company for the benefit of its members were to achieving those purposes. (4) The duty imposed by this section has effect subject to any enactment or rule of law requiring directors, in certain circumstances, to consider or act in the interests of creditors of the company.’. Amendments relating to chapter 2 of part 10 Mr Alan Duncan
389 Page 78, line 23 [Clause 171], leave out subsection (3). Mr Alan Duncan
390 Page 78, line 24 [Clause 171], leave out from ‘directors’ to end of line 25. Mr Alan Duncan
391 Page 78, line 26 [Clause 171], leave out subsection (4). Patrick Hall
2 Page 79, line 1, leave out Clause 173. Mr Alan Duncan
392 Page 79, line 2 [Clause 173], after ‘faith’, insert ‘and as appropriate for the size of the company’. Mr Alan Duncan
393 Page 79, line 4 [Clause 173], leave out from ‘whole’ to end of line and insert ‘having regard, insofar as he considers them relevant, to the following factors (amongst others)—’. Mr Alan Duncan
394 Page 79, line 4 [Clause 173], after ‘to’, insert ‘what he considers, in good faith, to be’. Mr Alan Duncan
395 Page 79, line 13 [Clause 173], at end insert ‘, and (g) all common law duties of directors.’. Mr Alan Duncan
788 Page 79, line 20 [Clause 173], at end insert— ‘(4) The duties implied by this section shall not apply to small and medium sized companies.’. Mr Alan Duncan
396 Page 79, line 20 [Clause 173], at end insert— ‘(4) None of the duties set out in or implied by this section shall take priority over any of the other duties.’. Mr Alan Duncan
397 Page 79, line 20 [Clause 173], at end insert— ‘(4) The duty to promote the success of the company shall be paramount.’. Mr Alan Duncan
398 Page 79, line 20 [Clause 173], at end insert— ‘(4) The Secretary of State must issue a non-statutory set of guidelines concerning the application of this section, which must be updated annually.’. Mr Alan Duncan
399 Page 79, line 36 [Clause 176], after ‘must’, insert ‘take all reasonable steps to’. Mr Alan Duncan
400 Page 79, line 37 [Clause 176], leave out ‘, or possibly may conflict,’. Mr Alan Duncan
401 Page 79, line 38 [Clause 176], at end insert ‘at the time when he seeks authorisation pursuant to subsection (5) below.’. Mr Alan Duncan
402 Page 80, line 4 [Clause 176], leave out paragraph (a) and insert— ‘(a) if the director reasonably and in good faith believes the situation is not likely to give rise to a conflict of interest; or’. Mr Alan Duncan
403 Page 80, line 14 [Clause 176], at end insert— ‘(5A) The authorisation may, in either case, be given by them (unconditionally, or subject to such conditions or limitations as they may specify), either in relation to a particular matter or generally, following receipt by them of a general notice in accordance with section 183.’. Mr Alan Duncan
404 Page 80, line 22 [Clause 176], at end insert— ‘(8) Where a conflict or potential conflict arises because of multiple directorships, the duty is not infringed if the director ensures there is no disadvantage to the interests of the company.’. Mr Secretary Darling 162 Page 83, line 11 [Clause 182], leave out ‘Company Law Reform’ and insert ‘Companies’. new clauses RELATING TO CHAPTER 1 AND CHAPTERS 3-9 OF PART 10 Loans to directors: requirement of members’ approval Mr Secretary Darling NC72 To move the following Clause:— ‘(1) A company may not— (a) make a loan to a director of the company or of its holding company, or (b) give a guarantee or provide security in connection with a loan made by any person to such a director, unless the transaction has been approved by a resolution of the members of the company. (2) If the director is a director of the company’s holding company, the transaction must also have been approved by a resolution of the members of the holding company. (3) A resolution approving a transaction to which this section applies must not be passed unless a memorandum setting out the matters mentioned in subsection (4) is made available to members— (a) in the case of a written resolution, by being sent or submitted to every eligible member at or before the time at which the proposed resolution is sent or submitted to him; (b) in the case of a resolution at a meeting, by being made available for inspection by members of the company both— (i) at the company’s registered office for not less than 15 days ending with the date of the meeting, and (ii) at the meeting itself. (4) The matters to be disclosed are— (a) the nature of the transaction, (b) the amount of the loan and the purpose for which it is required, and (c) the extent of the company’s liability under any transaction connected with the loan. (5) No approval is required under this section on the part of the members of a body corporate that— (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.’. Quasi-loans to directors: requirement of members’ approval Mr Secretary Darling NC73 To move the following Clause:— ‘(1) This section applies to a company if it is— (a) a public company, or (b) a company associated with a public company. (2) A company to which this section applies may not— (a) make a quasi-loan to a director of the company or of its holding company, or (b) give a guarantee or provide security in connection with a quasi-loan made by any person to such a director, unless the transaction has been approved by a resolution of the members of the company. (3) If the director is a director of the company’s holding company, the transaction must also have been approved by a resolution of the members of the holding company. (4) A resolution approving a transaction to which this section applies must not be passed unless a memorandum setting out the matters mentioned in subsection (5) is made available to members— (a) in the case of a written resolution, by being sent or submitted to every eligible member at or before the time at which the proposed resolution is sent or submitted to him; (b) in the case of a resolution at a meeting, by being made available for inspection by members of the company both— (i) at the company’s registered office for not less than 15 days ending with the date of the meeting, and (ii) at the meeting itself. (5) The matters to be disclosed are— (a) the nature of the transaction, (b) the amount of the quasi-loan and the purpose for which it is required, and (c) the extent of the company’s liability under any transaction connected with the quasi-loan. (5) No approval is required under this section on the part of the members of a body corporate that— (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.’. Loans or quasi-loans to persons connected with directors: requirement of members’ approval Mr Secretary Darling NC74 To move the following Clause:— ‘(1) This section applies to a company if it is— (a) a public company, or (b) a company associated with a public company. (2) A company to which this section applies may not— (a) make a loan or quasi-loan to a person connected with a director of the company or of its holding company, or (b) give a guarantee or provide security in connection with a loan or quasi-loan made by any person to a person connected with such a director, unless the transaction has been approved by a resolution of the members of the company. (3) If the connected person is a person connected with a director of the company’s holding company, the transaction must also have been approved by a resolution of the members of the holding company. (4) A resolution approving a transaction to which this section applies must not be passed unless a memorandum setting out the matters mentioned in subsection (5) is made available to members— (a) in the case of a written resolution, by being sent or submitted to every eligible member at or before the time at which the proposed resolution is sent or submitted to him; (b) in the case of a resolution at a meeting, by being made available for inspection by members of the company both— (i) at the company’s registered office for not less than 15 days ending with the date of the meeting, and (ii) at the meeting itself. (5) The matters to be disclosed are— (a) the nature of the transaction, (b) the amount of the loan or quasi-loan and the purpose for which it is required, and (c) the extent of the company’s liability under any transaction connected with the loan or quasi-loan. (6) No approval is required under this section on the part of the members of a body corporate that— (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.’. Amendments relating to chapter 1 AND CHAPTERS 3 TO 9 OF PARt 10 Jim Cousins
761 Page 71, line 10 [Clause 155], at end insert ‘and domiciled in the United Kingdom’. Jim Cousins
762 Page 71, line 11 [Clause 155], leave out subsection (2). Mr Alan Duncan
385 Page 72, line 8, leave out Clause 157. Mr Alan Duncan
386 Page 72, line 18 [Clause 157], leave out subsection (5). Mr Alan Duncan
387 Page 72 [Clause 158], leave out lines 30 and 31. Mr Alan Duncan
388 Page 73, line 12 [Clause 159], leave out ‘ceases’ and insert ‘shall not cease’. Mr Secretary Darling 255 Page 74, line 6 [Clause 162], leave out from ‘company’ to end of line 7 and insert— ‘(2A) The register must be kept available for inspection— (a) at the company’s registered office, or (b) at a place specified in regulations under section (Regulations about where certain company records to be kept available for inspection).’. Mr Secretary Darling 256 Page 74, line 7 [Clause 162], at end insert— ‘(2B) The company must give notice to the registrar— (a) of the place at which the register is kept available for inspection, and (b) of any change in that place, unless it has at all times been kept at the company’s registered office.’. Mr Secretary Darling 257 Page 74, line 11 [Clause 162], leave out ‘or (2)’ and insert ‘, (2) or (2A) or if default is made for 14 days in complying with subsection (2B)’. Mr Secretary Darling 258 Page 74, line 12 [Clause 162], leave out ‘this section’ and insert ‘subsection (3)’. Mr Secretary Darling 715 Page 74, line 14 [Clause 162], at end insert— ‘For this purpose a shadow director is treated as an officer of the company.’. Mr Secretary Darling 716 Page 75, line 38 [Clause 165], at end insert— ‘For this purpose a shadow director is treated as an officer of the company.’. Mr Secretary Darling 770 Page 76, line 15 [Clause 167], leave out from ‘from’ to ‘any’ in line 17 and insert— ‘(a) a person becoming or ceasing to be a director, or (b) the occurrence of’. Mr Secretary Darling 717 Page 76, line 41, leave out Clause 168. Jim Cousins
755 Page 85, line 32 [Clause 189], leave out ‘of Members’. Jim Cousins
756 Page 85, line 34 [Clause 189], leave out ‘members”’. Jim Cousins
757 Page 86, line 4 [Clause 189], at end insert— ‘(2A) A company may not agree to such a provision unless it has consulted its employees.’. Mr Secretary Darling 488 Page 86, line 33 [Clause 189], leave out subsection (6) and insert— ‘(6) No approval is required under this section on the part of the members of a body corporate that— (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.’. Mr Secretary Darling 591 Page 87, line 17 [Clause 191], after ‘company’ insert ‘or be conditional on such approval being obtained’. Mr Alan Duncan
19 Page 87, line 17 [Clause 191], at end insert ‘or must be conditional on such approval being obtained’. Mr Secretary Darling 489 Page 87, line 20 [Clause 191], leave out subsection (4) and insert— ‘(4) No approval is required under this section on the part of the members of a body corporate that— (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.’. |
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| © Parliamentary copyright 2006 | Prepared: 17 October 2006 |