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Lord McKenzie of Luton moved Amendment No. 487D:
On Question, amendment agreed to.
Lord McKenzie of Luton moved Amendments Nos. 487E and 487F:
"RECTIFICATION OF REGISTER ON APPLICATION TO REGISTRAR
(1) The Secretary of State may make provision by regulations requiring the registrar, on application, to remove from the register material of a description specified in the regulations that
(a) derives from anything invalid or ineffective or that was done without the authority of the company, or
(b) is factually inaccurate, or is derived from something that is factually inaccurate or forged.
(2) The regulations may make provision as to
(a) who may make an application,
(b) the information to be included in and documents to accompany an application,
(c) the notice to be given of an application and of its outcome,
(d) a period in which objections to an application may be made, and
(e) how an application is to be determined.
(3) An application must
(a) specify what is to be removed from the register and indicate where on the register it is, and
(b) be accompanied by a statement that the material specified in the application complies with this section and the regulations.
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(4) If no objections are made to the application, the registrar may accept the statement as sufficient evidence that the material specified in the application should be removed from the register.
(5) Where anything is removed from the register under this section the registration of which had legal consequences as mentioned in section 714(3), any person appearing to the court to have a sufficient interest may apply to the court for such consequential orders as appear just with respect to the legal effect (if any) to be accorded to the material by virtue of its having appeared on the register.
(6) Regulations under this section are subject to affirmative resolution procedure."
After Clause 716, insert the following new clause
"PUBLIC NOTICE OF REMOVAL OF CERTAIN MATERIAL FROM THE REGISTER
(1) The registrar must cause to be published
(a) in the Gazette, or
(b) in accordance with section 734 (alternative means of giving public notice),
notice of the removal from the register of any document subject to the Directive disclosure requirements (see section 699) or of any material derived from such a document.
(2) The notice must state the name and registered number of the company, the description of document and the date of receipt."
On Question, amendments agreed to.
Clause 739 [Application of Part to functions under other enactments]:
Lord McKenzie of Luton moved Amendment No. 487G:
On Question, amendment agreed to.
Schedule 4 [Amendments of remaining provisions of the Companies Act 1985 relating to offences]:
Lord McKenzie of Luton moved Amendment No. 488:
On Question, amendment agreed to.
Clause 757 [Service of documents on directors, secretaries and others]:
Lord McKenzie of Luton moved Amendment No. 489:
Page 365, line 25, leave out paragraphs (a) and (b) and insert "any address for the time being shown as a current address in relation to that person in the part of the register available for public inspection"
On Question, amendment agreed to.
Schedule 6 [Communications by a company other than a traded company]:
Lord Hodgson of Astley Abbotts moved Amendment No. 490:
"(2) Such agreement may be valid for a maximum of twelve months."
The noble Lord said: My Lords, I rise to rise to speak to Amendment No. 490 which concerns paragraph 9 of Part 4 of Schedule 6.
Part 4 of Schedule 6 enables companies to communicate electronically with their shareholders where shareholders have given their consent. But there appears to be no time limit to the consent once given.
The noble Lord, Lord Sharman, made clear during our debates that the electronic communication provisions enable companies to save a considerable sum of money. However, there is also the potential for problems caused by the failure of an individual member to understand properly what he or she is being asked to accept, and then being deemed to have agreed under paragraph 10.
There was some confusion when this amendment was tabled in Grand Committee. It was originally tabled with an amendment that made it read "minimum" instead of "maximum". This was corrected before the Committee sat, but I fear too late for the changes to reach the Minister as his speaking note addressed the minimum rather than the maximum that we intended. The noble Lord, Lord Sainsbury, said,
"I do not see the value of requiring a minimum period of commitment to receiving company documents by means of a website. Why should a member who agrees to use the web not be able to change his mind?".[Official Report, 30/3/06; col. GC 378.]
Absolutely: that is precisely the point. I am sorry that we caused confusion with our wrong tabling in the first place.
We have therefore re-tabled this amendment for the same reasons that we did in Committee. The amendment seeks to cap any agreement between a company and a member to a maximum of 12 months. When this period expires the company would have to negotiate another agreement for the next year. We do not think that it is unreasonable to require companies to do this, given the savings they will make by using communication via a website in the event of member agreement. The main benefit from this will be to protect members who unwittingly agree to use the
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website for communication. They will then be given an opportunity to rescind their decision, while those who wish to continue with such an agreement can easily continue to do so. I beg to move.
Lord Sainsbury of Turville: My Lords, I am grateful to the noble Lord for tabling this amendment again so that I may now give him the right answer to address his concerns. When the noble Lord first laid his amendment at Grand Committee seeking to provide that agreements under paragraph 9 should be valid for a minimum of twelve months, we had thought the objective might be about providing a degree of certainty to businesses investing in web technology upgrades. However, the amendment clearly does the opposite in limiting the period of the agreement to a maximum of 12 months.
I do not see the value in imposing a maximum period for agreements to receiving company documents by means of a website. This seems unduly burdensomea case of minor silver-plating rather than gold-plating, but nevertheless burdensomeand an unnecessary hurdle when we are seeking to facilitate the use of electronic communications. The other point is that people are not locked into these agreements. If someone changes his or her mind, it is clear that he or she can withdraw at any time. In any event, members and debenture holders always have the right under Clause 762 to request that a document or information received otherwise than in hard copy form be sent to them in hard copy.
Furthermore, a company must, under paragraph 13 of Schedule 6, notify an intended recipient of new documents posted on the website. If he has provided no e-mail address, then the company will, in effect, be obliged to send such notification in hard copy form by post, thus reminding the recipient of the website arrangement in place.
We think that the communications clauses and schedules together provide adequate protection for members and other intended recipients who may not have easy access to the internet or to e-mail. I hope, therefore, that the noble Lord will not press his amendment.
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