Company Law Reform Bill [HL]

moved Amendment No. 321:"Page 238, line 22, at end insert ““or if it would secure needless publicity for defamatory matter””" The noble Baroness said: The amendments relate to Clauses 502, 505 and 507 as well, as they are all related. There is no clarity about what an abuse of rights would be and it is therefore unclear how the courts will determine that. Introducing the new wording and omitting to include the current exemption, where a court considers that a statement was for the purpose of securing needless publicity for defamatory matter, means that it would be very helpful to establish in case law, by the Jarvis and Easter cases, which would be irrelevant. In Clause 507, the rationale for using the words ““to secure needless publicity for defamatory matter”” is set out in form AR1, in addition to Clause 507(4), which refers to rights. Clause 506 sets out obligations, not rights, for an auditor. The amendment would correct this. While its intention is good, the change to the existing Companies Act makes it more difficult for auditors to be candid about the circumstances regarding their loss of officers. Members of the Committee would understand if that had to be done. The amendment would reinstate the relevant wording. The amendment also suggests that form AR3 makes Clause 506(2) redundant. In Clause 506, the policy proposal from the Audit Quality Forum recommends a statement of circumstances which it is considered are connected to an auditor ceasing to hold office. This qualification is important as a statement from the auditors and involves judgment. The current wording does not make this clear. I beg to move.