New Clause 358

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

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Further provision about notices given under section (Right of offeror to buy out minority shareholder)

‘(1) A notice under section (Right of offeror to buy out minority shareholder) must be given in the prescribed manner.

(2) No notice may be given under section (Right of offeror to buy out minority shareholder)(2) or (4) after the end of—

(a) the period of three months beginning with the day after the last day on which the offer can be accepted, or

(b) the period of six months beginning with the date of the offer, where that period ends earlier and the offer is one to which subsection (3) below applies.

(3) This subsection applies to an offer if the time allowed for acceptance of the offer is not governed by rules under section 643(1) that give effect to Article 7 of the Takeovers Directive.

In this subsection “the Takeovers Directive” has the same meaning as in section 643.

(4) At the time when the offeror first gives a notice under section (Right of offeror to buy out minority shareholder) in relation to an offer, he must send to the company—

(a) a copy of the notice, and

(b) a statutory declaration by him in the prescribed form, stating that the conditions for the giving of the notice are satisfied.

(5) Where the offeror is a company (whether or not a company within the meaning of this Act) the statutory declaration must be signed by a director.

(6) A person commits an offence if—

(a) he fails to send a copy of a notice or a statutory declaration as required by subsection (4), or

(b) he makes such a declaration for the purposes of that subsection knowing it to be false or without having reasonable grounds for believing it to be true.

(7) It is a defence for a person charged with an offence for failing to send a copy of a notice as required by subsection (4) to prove that he took reasonable steps for securing compliance with that subsection.

(8) 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 to a fine not exceeding the statutory maximum (or both) and, for continued contravention, a daily default fine not exceeding one-fiftieth of the statutory maximum;

(ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both) and, for continued contravention, a daily default fine not exceeding one-fiftieth of the statutory maximum.’.—[Margaret Hodge.]

Brought up, read the First time and Second time, and added to the Bill.