Company Law Reform Bill

moved Amendment No. 199:"Page 85, line 19, at end insert ““for that director or a person connected with him,””" The noble Lord said: Clause 190(3) and (4) determine what transactions or arrangements are,"““other relevant transactions or arrangements””," for the purposes of working out whether the company may make further use of a particular exception to the requirement for member approval to a loan, quasi-loan or credit transaction under Clauses 180 or 182. Clause 190(3) deals with those cases where the transaction or arrangement is entered into for a director of the company, or a person connected with such a director. Clause 190(4) deals with those cases where the transaction or arrangement is entered into for a director of the company’s holding company, or a person connected with such a director. There is currently nothing in Clause 190 to restrict the relevant transaction or arrangement to those that have been entered into for the director, or for a person connected with a director. Therefore in its operation the clause is substantively different to the equivalent provisions of Section 339 of the Companies Act 1985 from which it is derived. Amendments Nos. 199 and 200 will bring Clause 190 into line with Section 339(3) of the Companies Act 1985, so that only transactions or arrangements entered into for the particular director seeking to take advantage of the exception—or persons connected to that particular director—are counted in determining whether the financial limits applying to an exception—relevant to Clauses 185 and 187—have been reached.