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Company Law Reform Bill [HL]

As I have explained, the regime for the control of political donations and expenditure by companies was introduced through the Political Parties, Elections and Referendums Act 2000 as part of the Government’s response to the report by the Committee on Standards in Public Life. The Government took the view in 2000 that it is better for all the players involved—not least political parties and companies—that political parties’ legislation and companies’ legislation share a common definition of political donation. We still believe that that is the right approach, and we therefore do not intend to amend the definition of political donation in the Bill. At the same time, we have no wish for the requirements in this part to be unduly onerous for companies. That is why we want to introduce reforms that will permit greater flexibility for companies. We also accept the importance of reasonable clarity in respect of the definitions in this part. I do not think that the noble Lord will expect me to comment in detail on the specific examples that he gave. A glib answer would be that it depends on the precise circumstances and facts in every case. We will consider further in consultation with the Electoral Commission whether additional guidance might be provided to companies on the definition of political donation. I shall comment briefly on the more specific points raised by Members of the Committee. There is at present no statutory provision for the valuing of donations made in foreign currencies in respect of the requirements. We assume—indeed, the noble Lord confirmed—that his amendment is prompted by concern about the rate of exchange that would apply in determining whether a particular donation fell within the exemption from authorisation afforded under Clause 351 to donations not exceeding £5,000. We consider that the relevant rate of exchange should be the rate of exchange on the business date nearest to the date on which the donation was made. We do not believe that it is necessary to specify that in the Bill but will be happy to reconsider the point if opinion is to the contrary. The definition of ““trade union”” in Clause 347 is not intended to exclude trade unions established in other jurisdictions, nor do we believe that the definition as drafted has that effect. Similarly, we do not believe that there is a need for a specific exemption for paid leave for employees who are local councillors. Under Section 50(6) of the Political Parties, Elections and Referendums Act 2000:"““Anything given or transferred to any officer, member, trustee or agent of a registered party in his capacity as such (and not for his own use or benefit) is to be regarded as given or transferred to the party””." We do not believe that paid leave for an elected local councillor is covered by that provision if it relates only to public duties performed as a local councillor. Needless to say, the position would be different if the paid leave was intended to permit the councillor in question to campaign for re-election. Finally, Part IV of the Political Parties, Elections and Referendums Act 2000 already recognises that companies may interact with political parties on commercial terms. It is also important to remember that Section 50(2)(a) of that Act states that ““donation”” means,"““any gift to the party of money or other property””." A payment made to a political party for the purposes of promoting or advertising the products or services of the company will not be treated as a gift if it is genuinely commensurate with the value of the service provided by the political party. I hope that that has dealt with the points raised by this series of amendments and that the noble Lord will therefore feel able to withdraw the amendment.