Clause 105
Company Law Reform Bill [Lords]
2:45 pm
Margaret Hodge (Minister of State (Industry and the Regions), Department of Trade and Industry; Barking, Labour)
I understand the point that is being raised by the hon. Gentlemen, in that with an unlimited company liability is not defined—although I do not entirely accept that that would give the sort of comfort to which the hon. Member for Huntingdon referred—whereas limited companies, by definition, have a limit on their liability. I can understand, therefore, why the hon. Member for Cambridge believes that there might be a role for creditors when an unlimited company re-registers as an limited company. The amendment would ensure that they are consulted and given a role. However, I am informed that such issues are tackled in other ways, which we believe to be sufficient. I hope that that argument will be accepted.
At the moment, the law provides that when a company is wound up within three years of having been re-registered as a limited company, having previously been unlimited, the liability of its original members remains.