Company Law Reform Bill [HL]

moved Amendment No. 127:"Page 56, line 21, leave out paragraph (a)." The noble Lord said: This is a probing amendment. In this group, Amendments Nos. 127, 128 and 129 all concern Clause 128, which relates to ““Shares acquired before prohibition became applicable””. This chapter deals with the prohibition on subsidiaries being members—that is, shareholders—of their holding companies, a policy which, in general terms, we support. However, Clause 128 makes provision to allow subsidiary corporate bodies who became shareholders in their parent company before the prohibition came into effect to remain as members. The relevant dates for this exclusion from the prohibition are in 1948 in Great Britain and in 1961 in Northern Ireland—58 and 45 years ago respectively. We wonder how many companies there now are taking advantage of this provision. Further, it could be argued that this handful of companies have had sufficient warning that this prohibition is in effect. Is there not an argument now that, if the practice is not to be prohibited outright, there should at least be some transitional phase towards eliminating this historical anomaly? I yield to no one in my dislike and disapproval of retrospective legislation, but the passage of half a century mitigates any impact. Can the Minister enlighten the Committee as to whether any consideration has been, or is being, given to phase out this provision? I beg to move.