Clause 112
Company Law Reform Bill [Lords]
3:30 pm
Jonathan Djanogly (Shadow Solicitor General (Also Shadow Minister for Trade and Industry), Law Officers (Assist the Home Affairs Team); Huntingdon, Conservative)
I beg to move amendment No. 23, in clause 112, page 50, line 17, after ‘addresses', insert
‘(which, for the avoidance of doubt, need not be a home address)'.
The clause relates to section 352 of the Companies Act 1985. Later I shall speak more fully on the problems caused by access to home addresses on the register of members. At this point, it is worth clarifying that there is no need to use a home address on a share transfer form or in the register of members. A service address can be used, such as that of a person’s accountant, bank or post office. Of course, having the name appear on the register, whatever the address, can create its own problems, particularly if the name is a rare one, which is why the ability to deny access is important, as we shall discuss later.
I would like to receive the Minister’s confirmation of one aspect of the matter. The July 2002 consultation document, “Regulatory Impact Assessment on Disclosure of beneficial ownership of unlisted companies” noted that the current registration system does not reveal any information regarding the beneficial ownership of shares. For that reason, the document noted, attempting to establish the ownership of the company by referring to the register has its limitations, as there is no means of discovering who beneficial shareholders are. To solve that problem, those responsible for the RIA were asked to consider a proposal put forward by the DTI and HM Treasury that a person must disclose to a private company, once their beneficial interest in shares exceeds 3 per cent.. The company would then be obliged to enter those details on a subsection of the register of members. Will the Minister confirm that that proposal will not now be proceeded with?
I would also appreciate the Minister’s clarification on a slightly different topic, which was raised in the Lords. I tabled a written question, to which I received a reply on 2 May. I asked:
“How many registered companies have issued stock?”
The response that I received from the then Minister was:
“Section 121(c) of the Companies Act 1985 permits a company to convert any or all of its paid-up shares into stock, and reconvert that stock into paid-up shares of any denomination. There are no available figures on the number of existing, registered companies that have used that procedure. However, the ability to convert shares into stock is to believed to be obsolete.” —[Official Report, 2 May 2006; Vol. 445, c. 1365W.]
Can we not now just get rid of stock?