Company Law Bill [HL]

This amendment is also to Clause 562, and it is concerned with the circumstances in which the resolution to reduce capital is to be posed at a general meeting of a company’s members. Clause 562(3) provides that a copy of the solvency statement made in support of the proposed capital reduction must be available for inspection throughout the meeting. The amendment would enable the members on request to inspect the statement in advance of the meeting. I have some sympathy with the intention behind the amendment, but there could be some confusion about what ““in advance”” might mean in these circumstances. Moreover, I am not convinced that such provision is necessary. We anticipate that the solvency statement will merely recite what is provided to be stated in new Section 135B(1) of the 1985 Act and we therefore query what additional benefit members might obtain by being given the right to see a copy of the statement in advance of the meeting. In other words, the solvency statement would not contain any detailed information or analysis which the directors may have considered in forming their opinion as regards the company’s situation, and it is therefore questionable why members might need to review the statement in advance of the meeting. It would rather be a question of their checking, if they so wished, that the directors had indeed signed up to the solvency statement. That is relatively quickly done and, if members had any concerns, they could of course vote against the resolution. In the circumstances, I am not convinced that Amendment No. A69A is needed.