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In Committee, the hon. Member for Huntingdon (Mr. Djanogly) seemed to think that it was generally a good idea to prohibit the appointment of young persons as directors, although I accept that he had concerns about transitional arrangements. He appears now to have slightly moved from that position. I still
take the view—it is open to hon. Members to express their view—that it is wrong to have young people as directors. In the other place, their lordships wanted to change the minimum age to 18, not 16. The idea of bringing it down to 10 is extremely dangerous and could lead to huge exploitation by others who want to shelter behind a child director, relying on enforcement authorities’ unwillingness to prosecute very young people. It is interesting that in the data to which the hon. Gentleman referred, there are 200 young directors under the age of 10.
This is a sensible measure. We will consider the transitional arrangements, and there will be consultation. If we make exceptions, they would apply to a company rather than an individual, so the young entrepreneurs whom the hon. Gentleman identified during his summer reading probably would not be covered, if I was honest with him, because they are individuals. If they have an idea, there are other ways in which they can pursue their business interest. The companies to which this might be relevant would be charities or community interest companies, which have a particular concern for young people. In such circumstances it might be appropriate to create an exception, but it would be dangerous to do that for individuals.
Mr. Djanogly: There is an important angle to this. If a young individual came to the Minister and said, “Look, I will have a serious tax problem or inheritance problem if I can’t hold this directorship,” would the Minister look at that on an individual basis under the provisions that exist in the legislation?
Margaret Hodge: I will look at that point. My understanding is that directorships are increasingly being given as christening presents, and one wonders about the purpose and intent behind that. Again, I am not 100 per cent. sure that that is sensible. We will look at the point that the hon. Gentleman raises.
Government amendments Nos. 715 and 717 have generally been welcomed. We have undertaken them for the practical reasons to which the hon. Member for Cambridge (David Howarth) alluded. Amendment No. 770 improves the clarity of the clause. It makes it clear that the registrar of companies must be notified on the appointment of a director and if for any reason a person ceases to be a director.
The Government have moved amendments tonight in response to the consideration of the Bill in Committee. That is one reason for our having so many amendments before us. I could have taken a much harder line in Committee and resisted what on most days I thought was a sensible debate, but I think that it is good for parliamentary scrutiny that we reach the best decisions for the long-term sustainability of this Bill. I am just sorry that the Conservative Opposition do not understand the way in which we have proceeded and chose again to make cheap political points and then not to appear when they could debate the issues.
Mr. Austin Mitchell:
I had hoped that my right hon. Friend the Minister would make a plea to me on bended knee, but she forgot to do so. In some respects I
am more confused than when I started. I doubt the point that she made on European law, but, if it is correct, it is yet another argument against the EU, so I am grateful for small mercies. In view of the problems that she has raised, I beg to seek leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Margaret Hodge: I beg to move amendment No. 255, in page 74, line 6 , 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).’.
Madam Deputy Speaker (Sylvia Heal): With this it will be convenient to discuss the following amendments: Government amendments Nos. 256 to 260, 254, and 261 to 264.
Government new clause 9— Inspection of records of resolutions and meetings.
Government new clause 10— Instruments creating charges and register of charges to be available for inspection.
Government new clause 11— Instruments creating charges and register of charges to be available for inspection.
Government new clause 12— Regulations about where certain company records to be kept available for inspection.
Government amendments Nos. 270 to 300.
Margaret Hodge: This package of Government amendments follows from the Commons Committee’s consideration of where a company must make its register of directors available for inspection. The Committee agreed both that any increased flexibility as to where the company records are to be kept for inspection should apply to other registers and records and that there need to be safeguards against abuse. The new clauses and amendments meet those concerns. They provide a power for regulations to specify alternatives to a company’s registered office as the place where a company must keep the specified registers and records available for further inspection.
Mr. Djanogly: The Government have complained about the lack of hon. Members in the House. Apart from the fact that the Government Benches are hardly overflowing, what would happen if many more hon. Members were here? None of them would have the opportunity to speak, because of the programme motion. We will not even be able to address this group of amendments.
It being half-past Eight o’clock, Madam Deputy Speaker proceeded to put the Questions necessary for the disposal of the business to be concluded at that hour, pursuant to Order [this day].
Amendments made: No. 256, in page 74, line 7, 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.’.
No. 257, in page 74, line 11, leave out ‘or (2)’ and insert
‘, (2) or (2A) or if default is made for 14 days in complying with subsection (2B)’.
No. 258, in page 74, line 12, leave out ‘this section’ and insert ‘subsection (3)’.
No. 715, in page 74, line 14, at end insert—
‘For this purpose a shadow director is treated as an officer of the company.’ . — [Margaret Hodge.]
Amendment made: No. 716, in page 75, line 38, at end insert—
‘For this purpose a shadow director is treated as an officer of the company.’ . — [Margaret Hodge.]
Amendment made: No. 770, in page 76, line 15, 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’. . — [Margaret Hodge.]
Amendment made: No. 717, in page 76, line 41, leave out Clause 168. . — [Margaret Hodge.]
Amendment made: No. 488, in page 86, line 33, 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.’. — [Margaret Hodge.]
Amendment made: No. 591, in page 87, line 17, after ‘company’ insert
‘or be conditional on such approval being obtained’. — [Margaret Hodge.]
Amendment made: No. 592, in page 90, line 14, leave out Clause 198. — [Margaret Hodge.]
Amendments made: No. 593, in page 91, line 22, leave out ‘A company’ and insert—
‘(1) This section applies to a company if it is—
(b) a company associated with a public company.
(2) A company to which this section applies’.
No. 490, in page 92, line 7, leave out subsection (5) and insert—
‘(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.’. — [Margaret Hodge.]
Amendments made: No. 594, in page 92, line 35, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’.
No. 491, in page 93, line 20, leave out subsection (5) and insert—
‘(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.’.
No. 595, in page 93, line 29, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
Amendment made: No. 596, in page 93, line 33, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
Amendments made: No. 597, in page 94, line 2, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’.
No. 598, in page 94, line 8, after ‘company’ insert ‘or an associated company’.
No. 613, in page 94, line 15, leave out ‘in connection with the matter’ and insert
‘under any transaction connected with the thing done’.
No. 163, in page 94, line 33, at end insert—
‘section 674(3) or (4) (power of court to grant relief in case of acquisition of shares by innocent nominee), or’.
No. 164, in page 94, line 35, leave out from ‘conduct)’ to end of line 37. — [Margaret Hodge.]
Amendments made: No. 599, in page 94, line 40, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’.
No. 600, in page 95, line 2, after ‘company’ insert ‘or an associated company’. — [Margaret Hodge.]
Amendment made: No. 601, in page 95, line 5, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval) or (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
Amendment made: No. 602, in page 95, line 28, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval) or (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
Amendment made: No. 603, in page 95, line 39, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval) or (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
Amendment made: No. 604, in page 96, line 26, leave out ‘198’ and insert
‘(Loans to directors: requirement of members’ approval), (Quasi-loans to directors: requirement of members’ approval), (Loans or quasi-loans to persons connected with directors: requirement of members’ approval)’. — [Margaret Hodge.]
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