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Clause 39

Volume 115: debated on Thursday 7 May 1987

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Power To Obtain Information And Require Production Of Documents

Lords amendment: No. 9, in page 31, line 39, leave out "or subsidiary" and insert ". subsidiary or related company".

I beg to move, That this House doth agree with the Lords in the said amendment.

With this it will be convenient to take Lords amendments Nos. 10, 12 to 17 and 55.

These amendments slightly widen the power under clause 39 for obtaining information by including "a related company" among the connected companies from which information and documents can be obtained. A "related company" is defined in the Companies Act as a company in which the authorised institutions hold 20 per cent. or more of the nominal value of the shares in the company.

The amendments widen the reach of the powers of investigators appointed under clause 41 to include companies in which the authorised institution or its shareholder controllers have a 20 per cent. or more stake, rather than just 50 per cent. as is the case in the Bill as it stands. These amendments were originally put forward by my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) on Third Reading.

The amendments reflect suggestions that have been made by the Institute of Chartered Accountants in England and Wales. The Government undertook to consider them and subsequently concluded that a widening along the lines of these amendments would be desirable. Therefore, such amendments were able to be included in the proceedings of the Bill in another place.

The Minister will know that we welcomed these amendments when they were moved in the other place, but we note that they go pretty wide. It is proper that an investigation should be thoroughly carried out and should include related companies as well. The Minister will know that companies may, for one reason or another, find themselves over 20 per cent. owned by an authorised institution, perhaps as a result of underwriting.

The amendment is a wide one, but nevertheless the Opposition accepted these amendments in the other place and realised that investigations must be able to be carried out as thoroughly as possible.

Question put and agreed to.

Lords amendment No. 10 agreed to.

Lords amendment: No. 11, in page 32, line 19, after "information" insert "or documents"

I beg to move, That this House doth agree with the Lords in the said amendment.

It alters subsection (9) of the clause by empowering the Bank of England to require the provision of documents as well as information from a director, controller of manager to assist it to determine whether that person is fit and proper. This brings the subsection in the clause into line with the other provisions in the Bill relating to the obtaining of information and to investigations, all of which include powers to require the furnishing of documents.

Question put and agreed to.

Lords amendments Nos. 12 to 17 agreed to.