In relation to Amendment 40, the Defamation Act 1996 gives a defence of qualified privilege to fair and accurate reports of proceedings at a general meeting of a UK public company and to copies of and extracts from various documents circulated to members of such a company.
Clause 7(7) extends this protection more widely to cover reports in relation to companies listed on recognised stock exchanges worldwide and to summaries of such material. This includes material circulated to members of a listed company which relates to the appointment, resignation, retirement or dismissal of directors of the company. The debate has reflected this. In drawing up this Bill, we have constantly challenged about where we are drawing the line and whether it is the right place to draw the line.
Amendment 40 would in addition extend qualified privilege to material relating to the appointment, resignation, retirement or dismissal of the company’s auditors. We do not consider that this would be appropriate. Extending privilege in this way would give protection to reports on contractual material between companies and their auditors such as issues of appointment and dismissal. We consider that this would be an inappropriate intrusion into how companies conduct their business affairs which could impact on business efficiency, and that it is preferable for the focus of Schedule 1 to continue to be on protecting fair and accurate reports of material which is publicly available.
Amendments 41 and 42 would alter the way in which the Bill extends qualified privilege—