The clause ties in with section 23(4) of the 1985 Act. Clause 130(2)(b) introduces a relevant date for Northern Ireland, in relation to when the provisions came into force. The second half of section 23(4) has been converted into the provision introducing a restriction on members’ use of their shares to vote on a written resolution. Currently, the restriction relates just to voting in general meetings when holding shares as an exception to clause 127, as allowed by the clause.
Lord Hodgson proposed an amendment in the other place to remove subsection (1)(a)—an exception to the restriction on a subsidiary being a member of its holding company. That exception applies to situations where the shares were bought prior to the relevant date—1 July 1948. It was pointed out that there can be only a handful of situations in which a subsidiary owns such shares and that those concerned have been on notice of the prohibition for nearly half a century. Lord Hodgson proposed that there should be a transitional phase towards eliminating that historical anomaly—quite rightly, in my view.
I am slightly confused because the hon. Gentleman’s amendment would remove the relevant date in paragraph (a) but leave in the reference to that date in paragraph (b), where it would have no obvious meaning.
Lord Sainsbury said in the House of Lords that there is a curtailment of the relevant shareholder rights in subsections (3) and (4), but I should be grateful if the Minister would give further observations on the matter, as it would be nice to clarify the issue and to avoid encountering it again the next time the Companies Acts are looked at in 20 years.
This seems to be one of those matters which has us dancing on the head of a pin. The advice that I have been given by officials is that there could well be companies that were around before 1948 and that we have no evidence of any implications of retaining the provision, so why upset the situation that exists? I share much of the scepticism of Opposition Members, but this is one of those things on which it appears that it is better to retain the provision in question just in case, rather than to remove it as redundant. I am happy to write further to the hon. Gentleman on that very technical issue. Although I think that hon. Members made good and valid points, that is my advice.
I just want to remark that several hangovers from times gone by seem to come up throughout the Bill. The dreaded issue of stock comes to mind. One cannot help feeling that at a time when we are clearing up the Companies Acts and moving ahead on a consolidated basis it would be nice to clear all the junk from the yard. However, I hear what the Minister says and do not entirely disagree, and on that basis, I beg to ask leave to withdraw the amendment.