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Companies (Reduction of Share Capital) Order 2008

On the issue of the date, following discussions with stakeholders we are minded to agree that the provisions on reserves arising from reductions of share capital should be applicable prospectively as from 1 October 2008, irrespective of when the capital reduction took effect. The matter will be addressed in the draft seventh commencement order, which is currently subject to public consultation. We intend to make the order before the Summer Recess. I am aware that there is wider debate with respect to specific aspects of the capital maintenance regimes—for instance, the realisation test—and that there are arguments both for and against further legislative reforms. European Community law governs much, if not all, of this area. While we do not currently have plans to publish a consultation on the specific proposals, we are maintaining an open dialogue with interested stakeholders and are keeping this issue under review. We continue to discuss with the Commission and other member states the case for reform of the second directive, which we support. On Question, Motion agreed to.