|Previous Section||Back to Table of Contents||Lords Hansard Home Page|
The noble Lord said: My Lords, the Minister made what I thought was an inadequate argument as to why this amendment should not be passed. So far as I could see, the only substantive point he made was that the CBI and the Institute of Directors do not want it. It may come as news to the Minister that there is quite a lot that the CBI and the Institute of Directors do not want, but that is not normally a reason for the Government not doing something. As I said when speaking to the previous amendment, the major purpose behind this amendment is to ensure that there are common standards so that investors in
2 Nov 2006 : Column 473
Lord McKenzie of Luton: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 255 to 257. I shall speak also to
2 Nov 2006 : Column 475
The first 19 of these amendments remove from the Bill the special rules on the audit of companies that are charities. The final two make similar changes to the Companies Act 1985. In future, the rules on the audit of charities will all be contained in charity law, whether the charity is a company or not. The Charities Bill was amended in another place on Wednesday evening to achieve the same result. We are making these changes to complete changes to the Bill begun on Report in May, on the basis of amendments put forward by the noble Lord, Lord Hodgson.
The result will be to complete the process that those amendments started of simplifying the law on scrutiny of the accounts of small charitable companies. These changes will reduce the complexity of this part of company law and make the rules on audit easier to understand for small charities.
The Office of the Third Sector carried out an informal consultation, which showed widespread support for the simplification. The changes to the existing Act will enable us to give effect to the simplification early next year, in co-ordination with changes to charity law. I hope the noble Lord will acknowledge that these are not only fine words but a veritable feast of buttered parsnips.
Lord Hodgson of Astley Abbotts: My Lords, I am grateful to the Minister for that reassurance. Concern has been expressed, as he explained to the House, that since we made the changes in the Bill here, which were subsequently reversed, the Charities Bill has had a further airing and a power has been inserted in it. Amendment No. 80 to the Charities Bill inserts a new clause in that Bill before Clause 77.
We are not necessarily unhappy about these amendments because, as the Minister has pointed out, they take all the scrutiny of charity accounts into the charities regulations, which seems sensible. We need to be clear, though, that there is co-ordination between the DTI and the Cabinet Office, the department responsible for charities, on the timing of how this will all happen. I think I heard the Minister say it is all intended to be brought into effect early in the new year. Concern has been expressed that with the power being a power only in the Charities Bill, there may be some temptation, dare I say it, to backslide and say, Its all frightfully difficult. Well hold back and put it off for a bit longer. That, obviously, is undesirable. If we do not co-ordinate the two Bills properly, charities will end up subject either to no regulation or to two sets of regulations simultaneously. That is also undesirable. I am seeking a reassurance this afternoon that the Government are on the case on that and that there is no intention to delay the implementation of the new regime for charity regulation.
Lord McKenzie of Luton: My Lords, I am happy to give the assurance that the Government are on the case. The co-ordination is important, and I reiterate that the changes will enable us to effect the simplification early next year. That is our intention.
Lord Sainsbury of Turville: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 263. Amendments Nos. 263, 265 and 757 are the net result of a series of amendments that have been tabled in both Houses concerning the provisions in Parts 15 and 24 relating to disclosure of information by the Financial Reporting Review Panel and the Takeover Panel.
It is fair to say that we had not anticipated that these disclosure provisions would attract the degree of debate that they have. They were closely based on existing precedents in financial services and company law. Nevertheless, the debate has been extremely valuable. It has served to remind us of the sensitivities and conflicting priorities involved in any regulatory disclosure provisions such as these.
We view positively the discussion we have had. It has caused us to reflect on the whole scope of the disclosure provisions related to the Financial Reporting Review Panel and the Takeover Panel and look at them afresh. We have discussed in substance with both the respective panels whether the framework of disclosure provisions strikes the right balance, recognising the need properly to protect confidential information while facilitating the exchange of such information between regulators and others in certain circumstances. Both they and we have concluded that the disclosure framework properly achieves that balance.
Baroness Noakes: My Lords, I thank the Minister for the amendment that brings the Data Protection Act into play in respect of the Financial Reporting Review Panel. However, we are disappointed that the Government have chosen to overturn the other amendments that we made to improveas we saw itthe controls on disclosure. Today is not the right day to have a wide-ranging debate on the advantages and disadvantages of information gateways. However, we have warned in this House and in another place of the dangers to companies of inappropriate disclosure. We hope that the Government will keep the use of these powers under review and will be prepared to act if such inappropriate disclosure takes place.
Lord Sainsbury of Turville: My Lords, this is the moment that I have been looking forward to. I beg to move that the House do agree with the Commons in their Amendments Nos. 315 to 512. I spoke to these amendments with Amendment No. 70.
Amendments Nos. 513 to 519 combine provisions that have been in the Bill from the outset in relation to debentures with a restatement of relevant provisions from the 1985 Act. There is no change of substance.
It may be helpful if I explain why there is there no equivalent for the register of debenture holders of the requirement, in Clause 119, for the company to advise those accessing the register of the date to which it has been made up. The Bill follows previous Companies Acts in that it does not regulate the content of the register of debentures in the way, in particular, that it does not require the register to include dates of becoming or ceasing to be a debenture holder. Therefore, it would be anomalous for companies to be required to provide for the register of debenture holders the sort of information which they have to provide under Clause 119 in relation to the register of members.
Furthermore, the relationship between the company, the holders of debentures and the holders of interests under any related trust deed is generally regulated by documents which are not part of the company law architecture. It would be excessively regulatory, and possibly wholly inappropriate, to impose an obligation for registers of debenture holders similar to Clause 119 for registers of members.
Lord Hodgson of Astley Abbotts: My Lords, I asked for this group of amendments to be degrouped. I was forewarned of issues that would need to be discussed. The Bill team very kindly drew my attention to a letter from Vera Baird, dated 26 July, which I had overlooked in the blizzard of paper that accompanies this legislation, which provided the necessary reassurance.
Part 21 is concerned with the certification and transfer of shares and other securities. I am pleased that there has been a broad measure of agreement on these clauses, which both restate existing statutory provision in respect of the certification and transfer of securities and extend the existing power under Section 207 of the Companies Act 1989 to require, as well as to permit, the paper-free holding and transfer of company shares.
I remind noble Lords of the background to this part. The Government have welcomed the work of industry groups, which are looking at options for greater use of paper-free holding and transfer of shares. Responses to the Company Law Reform White Paper of March 2005 showed strong support for this initiative, but it is also clear that more information is needed on the costs and benefits of making a more extensive use of a paper-free approach. The Government do not wish to rule out any option at this stage and therefore propose to extend the existing power relating to evidencing and transferring securities without a written instrument under Section 207 of the Companies Act 1989, so that it could be used to require, as well as to permit, the paper-free holding and transfer of company shares. If the power were used in this way, the Government would wish to ensure that the new arrangements for paperless holding and transfer of securities did not deprive individual shareholders of existing rights which may be important to them.
As the Economic Secretary to the Treasury made clear last month in replying to the recent consultation on this subject by the Institute of Chartered Secretaries and Administrators, a number of issues remain to be resolved before any decision can be reached as to how, or whether, the extended power should be used. I will place a copy of my honourable friends letter in the House Libraries. We are very grateful for the continuing work of the industry groups that are looking into the practical implications of greater use of paper-free holding and transfer of shares.
Amendments were tabled earlier with a view to clarifying the relationship between Section 207 of the Companies Act 1989 and the provisions in Part 21 that extend and make further provision in respect of the Section 207 power. We said that we would give serious thought to addressing those concerns by some form of consolidating amendment to Part 21. This is achieved through Amendments Nos. 537 to 558. We are satisfied that Section 207 can be repealed, and the new clauses introduced by these amendments brought into force, without in any way affecting existing regulations made under Section 207 and the systems that rely on them.
The new clauses introduced by Amendments Nos. 537 to 551 restate provisions of Sections 183 to 189 of the 1985 Act relating to the certification and transfer of shares and other securities. The new clause introduced by Amendment No. 555 differs in two respects from the corresponding clause in the Bill as it
2 Nov 2006 : Column 479
Secondly, the new clause uses the language of exercising rights rather than giving instructions in respect of the preservation of existing rights. It is important to ensure that the existing rights of those who are beneficial, but not legal, owners of shares are not disturbed by the new arrangements; and the new wording achieves that better. We are grateful to the Law Society for making comments that have inspired these changes, and to noble Lords opposite who championed similar amendments in Grand Committee.
|Next Section||Back to Table of Contents||Lords Hansard Home Page|