Company Law Reform Bill [HL]

I have tabled Amendments Nos. A3 and A5 in this group and I, too, am grateful for the Minister’s opening remarks on    Amendment No. A1. The second of my amendments—Amendment No. A5—would remove the words ““is presumed to be”” and replace them with the word ““was””. We are advised that that is a necessary adjunct or corollary to the change to which the Minister has now agreed in order for it to be effective. It may be a little hard for him to answer that on the fly, so to speak, but that was certainly one of the issues raised with us. A second follow-up is needed in order to achieve the situation that we all think is appropriate. Perhaps I may raise a second, more general point, which arises in some of the amendments to Clauses 525. Since the introduction of the Companies Act 1985, the practice of what is known as a pre-IPO—pre-initial public offering—round of fundraising has emerged. A company will do this quite openly, and it will be part of the sales pitch to people who are participating that it will lead to an offer—it might be an outright sale to another company but equally it could be an offer to the public. One issue that we would like to explore with the Government here and as we go through the Bill is the emergence of these new terms and new practices in which the idea of them subsequently being made available to the public is part of the sales pitch that leads to them being offered in the first place. It may occur within six, 12 or 18 months or some unspecified period; nevertheless, the offer to the public is part of the sales pitch in the first place. I should appreciate the Government’s thinking on that because it underlies some of the other amendments that we will come to later.