Clause 29
Company Law Reform Bill [Lords]
4:45 pm
David Howarth (Shadow Minister (Energy), Trade & Industry; Cambridge, Liberal Democrat)
May I add my own expression of delight at seeing you in the Chair, Mr. Bercow? I do not know what you have done to deserve it, but it must have been impressive.
Amendment No. 182 is largely probing. It seeks to establish whether the Government have thought through how the clauses work. My understanding of them is that if a shareholders’ agreement is not sent to the registrar, an offence is committed, but the agreement itself is still valid as between the parties. The purpose of the amendment is to ask the Government whether they intend that to be the case.
I am not sure how far to press it, but there is a case for the amendment, which is that making agreements unenforceable by the parties themselves would be a far more effective way to ensure their registration. Shareholders’ agreements are often constitutional documents of the company, and it is important for investors to be able to see them so that they are on notice that they exist, and to be able to see their terms—for instance, during due diligence.
My question for the Government is whether the wording of the Bill represents their intention. If so, why is that the case? If not, will they go away and think about it?