Clause 723

Company Law Reform Bill [Lords] – in a Public Bill Committee at 12:45 pm on 4th July 2006.

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Agreement for delivery by electronic means

Question proposed, That the clause stand part of the Bill.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice)

I read the clause as setting out that the registrar may make one-off agreements with specific companies to receive electronic documents. Will the Minister elaborate on why the clause is thought necessary? Presumably, as a matter of general policy, it is preferable that all companies play by the same rules on the delivery of documents, not least to provide certainty and consistency. Why the need for specific agreements?

Photo of Vera Baird Vera Baird Parliamentary Under-Secretary, Department for Constitutional Affairs

The clause sets out the power of the registrar to make agreements with companies to deliver information only electronically. In other words, Companies House and a particular company will be able to agree that they want to communicate electronically and how to do so. In practice it is likely, as I am sure the hon. Gentleman can envisage, that Companies House will draw up agreements in standard form containing detailed provisions for such  communications, including the possible use of codes and encryption. The agreements need not be available to everyone in the same form, or at all. The essential point is that they will be entered only if both parties think that there is benefit in doing so. It seems sensible that such arrangements should be available.

It might help if I explain that the intention is to prevent fraud—it actually says in my notes “to present fraud”, but I do not suppose that that is what is meant. If a company only delivers documents electronically, Companies House would not usually accept hard copies. That means that as long as a company keeps its password and so on secret, it will have complete control over what is filed. So the agreements will facilitate that extra protection. And why not, if both parties find it acceptable?

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice)

I thank the Minister for that clarification. I do not think that I read the clause incorrectly; it could provide for Companies House to make different agreements with different companies, which I think that the Minister said was not the intention, as is sensible. But it does provide for that, so I have concerns that it could be used for one-off agreements, which could be confusing. Perhaps the Minister would like to think about that further.

Photo of Vera Baird Vera Baird Parliamentary Under-Secretary, Department for Constitutional Affairs

I am grateful for the opportunity to do so. Clearly, although the intention is that there be a standard form, the same agreement need not be required, or any at all, for everyone. I am not sure what confusion the hon. Gentleman foresees, but I shall reflect on it, and if I can deduce confusion, I shall write to him to try and clear it up.

Question put and agreed to.

Clause 723 ordered to stand part of the Bill.