New Clause 219

Company Law Reform Bill [Lords] – in a Public Bill Committee at 1:45 pm on 20th July 2006.

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Directors’ statement: offence if no reasonable grounds for opinion

‘(1) If the directors make a statement under section (Directors’ statement and auditor’s report) without having reasonable grounds for the opinion expressed in it, an offence is committed by every director who is in default.

(2) A person guilty of an offence under this section is liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);

(b) on summary conviction—

(i) in England and Wales, to imprisonment for a term not exceeding twelve months or a fine not exceeding the statutory maximum (or both);

(ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months or a fine not exceeding the statutory maximum (or both).’.—[Margaret Hodge.]

Brought up, and added to the Bill.