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Company Law Reform Bill [HL]

The answer to that question is very simple. This is referring not to any previous Companies Act, but to the Companies Act which we are talking about. That is as I understand the situation. I will continue with the rest of the answer while someone corrects me if that is wrong. Clause 288 replaces Section 379 of the 1985 Act, setting out the requirements for resolutions requiring special notice. It makes provision only in relation to resolutions passed at meetings. This is because the resolutions for which special notice is required are either resolutions that are not capable of being passed as written resolutions, such as resolutions to remove a director or an auditor, or that can be passed as written resolutions only using a special procedure, such as in the case of the appointment of an auditor in place of an outgoing auditor. There is one change from existing law. It is still the case that at least 28 days’ notice must be given to the company of the intention to move a resolution requiring special notice. However, where it is not practicable for the company to give members notice of such a resolution at the time it gives notice of the meeting at which the resolution is to be moved, the company must give at least 14 days’ notice either by newspaper advertisement or by another manner allowed by the articles. That 14-day period replaces the 21-day period in the 1985 Act. It ties in with our general policy to standardise notice periods at 14 days, except in the case of public company AGMs. We appreciate that the special notice procedure may appear convoluted. However, it ties in with provisions that require a company to give directors and auditors a chance to make written representations about resolutions affecting their status. The company is obliged to circulate these representations to members unless it receives them too late. Consequently, extra notice is required of the intention to move one of the relevant resolutions, so that the company can notify the director or auditor and give him a chance to draft representations in time—ideally in time for the circulation of the meeting notice. That is the reason for the 28-day period. The clause also ensures that members have notice of the text of the proposed resolution. That is important because of the nature of resolutions that are subject to the special notice requirement. The Companies Act picks up the provisions of the 1985 Act, but all provisions about special notice are now in the Bill. That is the answer to the question. I therefore urge that Clause 288 stand part of the Bill.