Clause 60
Company Law Reform Bill [Lords]
9:30 am
James Brokenshire (Hornchurch, Conservative)
The clause requires that private limited companies use a particular suffix to denote their status, and the amendments are intended to simplify it. In the days when I was learning how to draft contracts and other legal documents, I was always told not to use three words when one would do. Applying that logic and that adage to the clause, I wonder why we should use three subsections when one will do, particularly when the Bill is intended to simplify company legislation and slim down what might otherwise be an excessive burden of regulation. Amendment No. 124 is largely a drafting amendment to give effect to that approach.
Amendment No. 125 is slightly different. Although I welcome the introduction of greater cross-referencing in the Bill, I do not welcome the fact that it sometimes adds confusion. Subsection (4) says that the clause
“does not apply to community interest companies”,
but then invites the reader to see certain sections of the Companies (Audit, Investigations and Community Enterprise) Act 2004. That leaves the reader in some confusion as to whether community interest companies are caught or not. Amendment No. 125 would make the position definitive, but if it is not acceptable to the Minister, I hope that she will consider an alternative formulation of subsection (4) to ensure that there is some clarity about the scope and ambit of the clause.