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Company Law

Volume 113: debated on Wednesday 25 March 1987

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asked the Secretary of State for Trade and Industry what plans he has to seek to reform company law on nominee shareholdings.

The possibility of changing company law on nominee shareholdings and other matters is already under consideration as part of the review of the operations of the takeover panel which I announced in the House on 28 January.

Why has the Secretary of State embarked on a programme of determined inertia and felicitous procrastination as regards the breaking up of offshore syndicates run by eminent and distinguished merchant bankers, accountants and solicitors who deal in nominee shareholdings? Can the Secretary of State tell us what progress has been made in the discussions between his Department and the Channel Islands and the Isle of Man, which act as havens for fraudsters in this sphere?

We have had discussions with a number of regulatory authorities, and these are proceeding extremely satisfactorily. As for determined inertia, that is hardly a fair accusation when I have already told the House that I hope to make an announcement about the review of the operations of the takeover panel next month.

Would it not be a simple matter immediately to implement the recommendations of the stock exchange, which are that nominee shareholdings should be unable to exercise voting rights or to nominate proxies?

Yes, that is certainly one of the matters presently under consideration.

Is it not possible that Marketing and Acquisition Consultants, a firm in Jersey, is a receptacle for large amounts of money belonging to Guinness, which is being fed into the island illegally? Why do the Government not find out who owns that company? Why do they not make extraordinary efforts, as against using the mechanisms that are currently available to them? The Government can find out who is behind that company if they wish to know. It is in the public interest to find out. Why do the Government not make a greater effort?

The hon. Gentleman knows perfectly well that a number of investigations are taking place. I really do not believe that it is proper for me to go further than that in the House at this time.