Company Law Reform Bill [Lords]


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New Clause 240

Meaning of “distributable profits”
‘In this Part (except in Chapter (Financial assistance for purchase of own shares) (financial assistance): see section (Definitions for this Chapter) “distributable profits”, in relation to the making of any payment by a company, means profits out of which the company could lawfully make a distribution (within the meaning given by section (Distributions to be made only out of profits available for the purpose)) equal in value to the payment.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 241

General power to make further provision by regulations
‘(1) The Secretary of State may by regulations modify the provisions of this Part.
(2) The regulations may—
(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.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 242

Meaning of “debenture”
‘In the Companies Acts “debenture” includes debenture stock, bonds and any other securities of a company, whether or not constituting a charge on the assets of the company.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 243

Perpetual debentures
‘(1) A condition contained in debentures, or in a deed for securing debentures, is not invalid by reason only that the debentures are thereby made—
(a) irredeemable, or
(b) redeemable only—
(i) on the happening of a contingency (however remote), or
(ii) on the expiration of a period (however long),
any rule of equity to the contrary notwithstanding.
(2) Subsection (1) applies to debentures whenever issued and to deeds whenever executed.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 244

Enforcement of contract to subscribe for debentures
‘A contract with a company to take up and pay for debentures of the company may by enforced by an order for specific performance.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 245

Registration of allotment of debentures
‘(1) A company must register an allotment of debentures as soon as practicable and in any event within two months after the date of the allotment.
(2) If a company fails to comply with this section, an offence is committed by—
(a) the company, and
(b) every officer of the company who is in default.
(3) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.
(4) For the duties of the company as to the issue of the debentures, or certificates of debenture stock, see Part 22 (certification and transfer of securities).’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 246

Debentures to bearer (Scotland)
‘Notwithstanding anything in the statute of the Scots Parliament of 1696, chapter 25, debentures to bearer issued in Scotland are valid and binding according to their terms.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 247

Register of debenture holders
‘(1) Any register of debenture holders of a company that is kept by the company must be kept available for inspection—
(a) at the company’s registered office, or
(b) at another place in the part of the United Kingdom in which the company is registered.
(2) A company must give notice to the registrar of the place where any such register is kept available for inspection and of any change in that place.
(3) No such notice is required if the register has, at all times since it came into existence, been kept available for inspection at the company’s registered office.
(4) If a company makes default for 14 days in complying with subsection (2), an offence is committed by—
(a) the company, and
(b) every officer of the company who is in default.
(5) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and in the case of continued contravention to a daily default fine not exceeding one-tenth of level 3 on the standard scale.
(6) References in this section to a register of debenture holders include a duplicate—
(a) of a register of debenture holders that is kept outside the United Kingdom, or
(b) of any part of such a register.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 248

Register of debenture holders: right to inspect and require copy
‘(1) Every register of debenture holders of a company must, except when duly closed, be open to the inspection—
(a) of the registered holder of any such debentures, or any holder of shares in the company, without charge, and
(b) of any other person on payment of such fee as may be prescribed.
(2) Any person may require a copy of the register, or any part of it, on payment of such fee as may be prescribed.
(3) A person seeking to exercise either of the rights conferred by this section must make a request to the company to that effect.
(4) The request must contain the following information—
(a) in the case of an individual, his name and address;
(b) in the case of an organisation, the name and address of an individual responsible for making the request on behalf of the organisation;
(c) the purpose for which the information is to be used; and
(d) whether the information will be disclosed to any other person, and if so—
(i) where that person is an individual, his name and address,
(ii) where that person is an organisation, the name and address of an individual responsible for receiving the information on its behalf, and
(iii) the purpose for which the information is to be used by that person.
(5) For the purposes of this section a register is “duly closed” if it is closed in accordance with provision contained—
(a) in the articles or in the debentures,
(b) in the case of debenture stock in the stock certificates, or
(c) in the trust deed or other document securing the debentures or debenture stock.
Brought up, and added to the Bill.

New Clause 249

Register of debenture holders: response to request for inspection or copy
‘(1) Where a company receives a request under section (Register of debenture holders: right to inspect and require copy) (register of debenture holders: right to inspect and require copy), it must within five working days either—
(a) comply with the request, or
(b) apply to the court.
(2) If it applies to the court it must notify the person making the request.
(3) If on an application under this section the court is satisfied that the inspection or copy is not sought for a proper purpose—
(a) it shall direct the company not to comply with the request, and
(b) it may further order that the company’s costs (in Scotland, expenses) on the application be paid in whole or in part by the person who made the request, even if he is not a party to the application.
(4) If the court makes such a direction and it appears to the court that the company is or may be subject to other requests made for a similar purpose (whether made by the same person or different persons), it may direct that the company is not to comply with any such request.
The order must contain such provision as appears to the court appropriate to identify the requests to which it applies.
(5) If on an application under this section the court does not direct the company not to comply with the request, the company must comply with the request immediately upon the court giving its decision or, as the case may be, the proceedings being discontinued.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 250

Register of debenture holders: refusal of inspection or default in providing copy
‘(1) If an inspection required under section (Register of debenture holders: right to inspect and require copy) (register of debenture holders: right to inspect and require copy) is refused or default is made in providing a copy required under that section, otherwise than in accordance with an order of the court, an offence is committed by—
(a) the company, and
(b) every officer of the company who is in default.
(2) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.
(3) In the case of any such refusal or default the court may by order compel an immediate inspection or, as the case may be, direct that the copy required be sent to the person requesting it.’.—[Margaret Hodge.]
Brought up, and added to the Bill.

New Clause 251

Register of debenture holders: offences in connection with request for or disclosure of information
‘(1) It is an offence for a person knowingly or recklessly to make in a request under section (Register of debenture holders: right to inspect and require copy) (register of debenture holders: right to inspect and require copy) a statement that is misleading, false or deceptive in a material particular.
(2) It is an offence for a person in possession of information obtained by exercise of either of the rights conferred by that section—
(a) to do anything that results in the information being disclosed to another person, or
(b) to fail to do anything with the result that the information is disclosed to another person,
knowing or having reason to suspect that person may use the information for a purpose that is not a proper purpose.
(3) A person guilty of an offence under this section is liable—
(a) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);
(b) on summary conviction—
(i) in England and Wales, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);
(ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both).’.—[Margaret Hodge.]
Brought up, and added to the Bill.
 
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Prepared 21 July 2006