§ Mr. A. V. ALEXANDERI beg to move,
That leave be given to bring in a Bill to amend Section one hundred and eighteen of the Companies Act, 1928.The House will remember that last year this Parliament passed a very long Bill, of 118 Clauses, which involved very important and far-reaching amendments to the group of legislation which governs the registration, constitution and practice of joint stock companies. It may also be remembered that in that Bill no appointed day was laid down for the commencement of its operation, except that Section 92 of the Act, dealing with what is usually known as "share pushing," was put into operation at once; and recently, in order to facilitate readjustments of the capital of certain companies, Section 53 was put into operation by an Order in Council. During the Debates on the Bill of 1928, there was a distinct understanding that this very wide amending proposal would be followed immediately by a consolidating Act, and, therefore, no appointed day was fixed, because it was thought that the consolidating Bill would be got through in this Parliament, and that the reforms, where reforms were involved, would be put into operation as soon as the consolidating Act was passed.The matter has since been referred to on one or two occasions in this House. The hon. and gallant Member for Everton (Colonel Woodcock) put down a question last December, and on that occasion the answer of the Prime Minister was such 1610 as to lead Members of the House to suppose that the consolidating Bill would be passed through all its stages during the lifetime of the present Parliament. The consolidating Bill, however, which was introduced into the House of Lords by the Lord Chancellor on the 21st February, does not, on our present information, seem to give us any real basis of hope that the reforms in the Companies Act, 1928, will come into operation in the immediate future. I would like to read to the House the statement made by the Lord Chancellor on the 21st February in the House of Lords. He said:
It may happen that there will ultimately appear to be necessary some amendment of the law as it is declared in the Bill when the Committee have finished with it. It will, in that event, become the duty of the Government to introduce some amending legislation in order to get rid of any difficulties that may appear. That can be done, of course"—I hope the President of the Board of Trade will listen to this—by the process of letting the present Bill drop or bringing in an amending Bill in some future Parliament and then a fresh Consolidation Bill which will embody both the Amendments and the results of the labours of the present Committee. It can, I think, be preferably done, unless the Amendments are numerous, by passing this Bill as it is ultimately amended by the Committee into law, but to postpone the date of its actual coming into operation until such Amendments as are necessary are cast in some ensuing Parliament.4.0 p.m.The Lord Chancellor, therefore, seemed to visualise one of two proceedings—that either the Consolidation Bill should be dropped and new amending legislation considered, or else amending legislation should now be introduced, and the date 1611 of operation of the Bill postponed until some future date after such legislation had been passed. We very much hope that that is not to be the position, and it is for that reason we introduce this Bill. The Companies Act, 1928, by no means met the whole of the case on this side of the House as regards the law governing companies in general, but, at any rate, it did a great deal to remedy some of the abuses, more especially with regard to the issue of prospectuses, the method of publishing accounts and the giving of information to shareholders. While the Act by no means met us entirely, we are very anxious that it should be put into operation at the earliest opportunity. From the statement of the Lord Chancellor on 21st February in another place, however, there seems to be no real ground for hoping that a Bill will be passed in the present Parliament.
We have seen in the last few months a notorious example of how shareholders can be completely misled—to use no stronger word; I think I might say fraudulently misled—by the prospectus of a company, and, in regard to the issue of prospectuses, quite recently such important newspapers as the "Daily Mail" and the "Evening News" positively refused to publish a prospectus of a company, because, in their judgment, that prospectus was not giving reasonable, full and desirable information to the public who were being asked to invest in that company. Therefore, with cases of that kind still arising, it is perfectly plain that there is urgent need for the reforms which were included in the Act of 1928 to be put into operation, and not be left over until a completely uncertain date. After the lengthy Debate we had last year upon all the details of the Act, there is not any need, in moving this Bill under the ten minutes' Rule, to emphasise any further the need for operating the provisions of the Act immediately. While it would be more convenient to consolidate the Acts, if, as seems likely from the speech of the Lord Chancellor in another place, the passing of such a Consolidation Bill in this Parliament is doubtful, it may be considered that Section 118 of the Act of 1928 should be amended, so as to do away with the provision that the 1612 appointed day can only be fixed by Order in Council, and that we should by this Bill fix the date as at 1st October, 1929.
§ Rear-Admiral BEAMISHI rise to oppose the Motion. As a member of the Committee which sat upstairs so long, I have only too good cause to remember the complexity of the Act passed in 1928. At the same time, this matter requires more consideration than, I think, has been given to it by the hon. Member for Hillsborough (Mr. Alexander). I noticed that he addressed his remarks just now to the President of the Board of Trade, but I think I am right in saying that, by the custom of the House, it is not within the rights of the President of the Board of Trade to make a reply on this occasion, and it might have been a better plan if a question had been put down. I think that the hon. Member's doubts and fears would then have beer, cleared up. What are the facts? A Consolidation Bill is being put forward in another place, and the Lord Chancellor very properly made certain remarks in regard to the complexity of the Bill, and the necessity for caution before a Bill of no less than 380 Clauses, including, of course, the 1928 Act, should be made into an Act of Parliament He very properly said that it must be given great consideration, and the Bill is now before a Joint Committee of both Houses. With the difficulties that are inevitable with a Consolidation Bill which consolidates no fewer than four Acts of Parliament—1908, 1913, 1917 and 1928—it is essential that it should be given the closest possible consideration before it is put on the Statute Book and people have to abide by it.
One has got to remember that there are numbers of people who write text books, and that there are the directors and officials of all the companies in this country, all of whom will be bound by that great Consolidation Bill, and if there are any points in it that are not absolutely clear, it is going to lead to a great deal of trouble, and not do the good which is naturally the desire of everybody to see carried into effect. I, personally, hold the strongest views that the Act of 1928 is most essential, and I showed that very clearly by certain votes which I gave when the Measure 1613 was upstairs. It is absolutely vital that more time should be given for consideration of this Bill, and I want, if I may, to clear up the hon. Gentleman's doubts and fears, and to say that, although I have no positive assertion, I have made as many inquiries as I can into the matter, and, as far as I am able to discover, there is no reason whatever why this Consolidation Bill should not be passed in the lifetime of the present Parliament. There is one other thing, of which I am quite confident, and that is that there is not smallest intention on the part of the
§ Government deliberately to postpone the bringing into operation of the 1928 Act which the hon. Member is so anxious to see brought about. I would ask him, in view of what I have tried to put forward, with great sincerity and earnestness, that he should withdraw his Bill, and not go to a Division.
§
Question put,
That leave be given to bring in a Bill to amend Section one hundred and eighteen of the Companies Act, 1928.
§ The House divided: Ayes, 88; Noes, 170.
1615| Division No. 269.] | AYES. | [4.10 p.m. |
| Adamson, W. M. (Staff., Cannock) | Hall, G. H. (Merthyr Tydvil) | Purcell, A. A. |
| Alexander, A. V. (Sheffield, Hillsbro') | Hardle, George D. | Richardson, R. (Houghton-le-Spring) |
| Ammon, Charles George | Harris, Percy A. | Ritson, J. |
| Baker, I. (Wolverhampton, Bilston) | Hayday, Arthur | Saklatvala, Shapurji |
| Barker, G. (Monmouth, Abertillery) | Hayes, John Henry | Scrymgeour, E. |
| Barnes, A. | Henderson, Right Hon. A. (Burnley) | Shaw, Rt. Hon. Thomas (Preston) |
| Barr, J. | Hirst, G. H. | Shinwell, E. |
| Batey, Joseph | Hirst, W. (Bradford, South) | Short. Alfred (Wednesbury) |
| Bellamy, A. | Hore-Belisha, Leslie | Sinclair, Major Sir A. (Caithness) |
| Benn, Wedgwood | John, William (Rhondda, West) | Sitch, Charles H. |
| Bennett, William (Battersea, South) | Jones, Morgan (Caerphilly) | Smith, H. B. Lees (Keighley) |
| Bowerman. Rt. Hon. Charles W. | Kelly, W. T. | Snell, Harry |
| Broad, F. A. | Kennedy, T. | Snowden, Rt. Hon. Philip |
| Cape, Thomas | Kenworthy, Lt.-Com. Hon. Joseph M. | Stewart, J. (St. Rollox) |
| Clarke, A. B. | Lansbury, George | Thomas, Rt. Hon. James H. (Derby) |
| Collins, Sir Godfrey (Greenock) | Lawrence, Susan | Thomas, Sir Robert John (Anglesey) |
| Compton, Joseph | Longbottom, A. W. | Thurtle, Ernest |
| Cowan, O. M. (Scottish Universities) | Lowth, T. | Townend, A. E. |
| Crawfurd, H. E. | Maclean, Nell (Glasgow, Govan) | Viant, S. P. |
| Day, Harry | MacNeill-Weir, L. | Watson, W. M. (Dunfermline) |
| Duncan, C. | Malone, C. L'Estrange (N'thampton) | Webb, Rt. Hon. Sidney |
| Dunnico, H. | March, S. | Williams, C. P. (Denbigh, Wrexham) |
| Edge, Sir William | Montague, Frederick | Williams, David (Swansea, E.) |
| Evans, Capt. Ernest (Welsh Univer.) | Morrison, R. C. (Tottenham, N.) | Wilson, R. J. (Jarrow) |
| Gillett, George M. | Murnin, H. | Windsor, Walter |
| Gosling, Harry | Naylor, T. E. | Young, Robert (Lancaster, Newton) |
| Graham, Rt. Hon. Wm. (Edin., Cent.) | Owen, Major G. | |
| Greenwood, A. (Nelson and Colne) | Palin, John Henry | TELLERS FOR THE AYES.— |
| Grenfell, D. R. (Glamorgan) | Parkinson, John Allen (Wigan) | Mr. Charles Edwards and Mr. T. Henderson. |
| Grundy, T. W. | Pethick-Lawrence, F. W. | |
| Hall, F. (York, W. R., Normanton) | Potts, John S. | |
| NOES. | ||
| Acland-Troyte, Lieut.-Colonel | Buckingham, Sir H. | Edwards, J. Hugh (Accrington) |
| Albery, Irving James | Bull, Rt. Hon. Sir William James | Elliot, Major Walter E. |
| Applin, Colonel R. V. K. | Bullock, Captain M. | England, Colonel A. |
| Apsley, Lord | Burman, J. B. | Erskine, James Malcolm Monteith |
| Ashley, Lt.-Col. Rt. Hon. Wilfrid W. | Burton, Colonel H. W. | Fairfax, Captain J. G. |
| Astbury, Lieut.-Commander F. W. | Campbell, E. T. | Falte, Sir Bertram G. |
| Barclay-Harvey, C. M. | Cautley, Sir Henry S. | Fanshawe, Captain G. D. |
| Beckett, Sir Gervase (Leeds, N.) | Cecil, Rt. Hon. Sir Evelyn (Aston) | Fermoy, Lord |
| Bellairs, Commander Carlyon | Christie, J. A. | Fielden, E. B. |
| Berry, Sir George | Churchill, Rt. Hon. Winston Spencer | Forestier-Walker, Sir L. |
| Bethel, A. | Cobb, Sir Cyril | Forrest, W. |
| Betterton, Henry B. | Conway, Sir W. Martin | Fraser, Captain Ian |
| Birchall, Major J. Dearman | Cooper, A. Duff | Fremantle, Lieut.-Colonel Francis E. |
| Bourne, Captain Robert Croft | Cope, Major Sir William | Gadle, Lieut.-Col. Anthony |
| Bowyer, Captain G. E. W. | Couper, J. B. | Ganzoni, Sir John |
| Brassey, Sir Leonard | Courthope, Colonel Sir G. L. | Gates, Percy |
| Bridgeman, Rt. Hon. William Clive | Crooks, J. Smedley (Deritend) | Glyn, Major R. G. C. |
| Briggs, J. Harold | Crookshank, Cpt. H. (Lindsey, Gainsbro) | Goff, Sir Park |
| Briscoe, Richard George | Dalkeith, Earl of | Grant, Sir J. A. |
| Brittain, Sir Harry | Davies, Sir Thomas (Cirencester) | Grattan-Doyle, Sir N. |
| Brocklebank, C. E. R. | Davies, Dr. Vernon | Gretton, Colonel Rt. Hon. John |
| Brooke, Brigadier-General C. R. I. | Davison, Sir W. H. (Kensington, S.) | Hammersley, S. S. |
| Broun-Lindsay, Major H. | Eden, Captain Anthony | Hannon, Patrick Joseph Henry |
| Brown, Brig.-Gen. H. C. (Berks, Newb'y) | Edmondson, Major A. J. | Harrison, G. J. C. |
| Headlam, Lieut.-Colonel C. M. | Moore, Sir Newton J. | Smith, R. W. (Aberd'n & Kinc'dine, C.) |
| Henderson, Capt. R. R. (Oxt'd, Henley) | Morrison, H. (Wilts, Salisbury) | Smithers, Waldron |
| Henderson, Lieut.-Col. Sir Vivian | Morrison-Bell, Sir Arthur Clive | Somerville, A. A. (Windsor) |
| Hennessy, Major Sir G. R. J. | Murchison, Sir Kenneth | Southby, Commander A. R. J. |
| Herbert, S. (York, N. R., Scar. & Wh'by) | Newton, Sir D. G. C. (Cambridge) | Stanley, Lieut.-Colonel Rt. Hon. G. F. |
| Hilton, Cecil | Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld.) | Storry-Deans, R. |
| Heare, Lt.-Col. Rt. Hon. Sir S. J. G. | Nield, Rt. Hon. Sir Herbert | Streatfeild, Captain S. R. |
| Holbrook, Sir Arthur Richard | Oakley, T. | Stuart, Crichton-, Lord C. |
| Hope, Sir Harry (Forfar) | Oman, Sir Charles William C. | Sueter, Rear-Admiral Murray Fraser |
| Hopkins, J. W. W. | Penny, Frederick George | Thompson, Luke (Sunderland) |
| Hopkinson, Sir A. (Eng Universities) | Perring, Sir William George | Thomson, Sir Frederick |
| Howard-Bury, Colonel C. K. | Peto, Sir Basil E. (Devon, Barnstaple) | Thomson, Rt. Hon. Sir W. Mitchell |
| Hudson, R. S. (Cumberland, Whiteh'n) | Pownall, Sir Assheton | Tinne, J. A. |
| Hume, Sir G. H. | Price, Major C. W. M. | Titchfield, Major the Marquess of |
| Iveagh, Countess of | Raine, Sir Walter | Tryon, Rt. Hon. George Clement |
| James, Lieut.-Colonel Hon. Cuthbert | Ramsden, E. | Ward, Lt.-Col. A. L. (Kingston-on-Hull) |
| Kennedy, A. R. (Preston) | Reid, Capt. Cunningham (Warrington) | Warner Brigadier-General W. W. |
| Kindersley, Major Guy M. | Rhys, Hon. C. A. U. | Warrender, Sir Victor |
| King, Commodore Henry Douglas | Richardson, Sir P. W. (Sur'y, Ch'ts'y) | Watts, Sir Thomas |
| Lamb, J. Q. | Robinson, Sir T. (Lanes., Stretford) | White, Lieut.-Col. Sir G. Dairymple |
| Lister, Cunliffe, Rt. Hon. Sir Philip | Ropner, Major L. | Williams, A. M. (Cornwall, Northern) |
| Locker, Lampson, Rt. Hon. Godfrey | Ross, R. D. | Williams, Com. C. (Devon, Torquay) |
| Lucas-Tooth, Sir Hugh Vere | Ruggles-Brise, Lieut.-Colonel E. A. | Williams, Herbert G (Reading) |
| Luce, Major-Gen. Sir Richard Harman | Russell, Alexander West (Tynemouth) | Wilson, Sir C. H. (Leeds, Central) |
| MacAndrew, Major Charles Glen | Salmon, Major I. | Womersley, W. J. |
| McLean, Major A. | Samuel, A. M. (Surrey, Farnham) | Wood, Sir S. Hill- (High Peak) |
| MacRobert, Alexander M. | Sandeman, N. Stewart | Worthington-Evans. Rt. Hon. Sir L. |
| Maitland, A. (Kent, Faversham) | Sandon, Lord | Wright, Brig.-General W. D. |
| Makins, Brigadier-General E. | Sassoon, Sir Philip Albert Gustave D. | Yerburgh, Major Robert D. T. |
| Manningham-Buller, Sir Mervyn | Savery, S. S. | Young, Rt. Hon. Sir Hilton (Norwich) |
| Margesson, Captain D. | Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W.) | |
| Marriott, Sir J. A. R. | Sheffield, Sir Berkeley | TELLERS FOR THE NOES.— |
| Mitchell, S. (Lanark, Lanark) | Shepperson, E. W. | Rear-Admiral Beamish and Mr. Roy Wilson. |
| Monsell, Eyres, Com. Rt. Hon. B. M. | Smith, Louis W. (Sheffield, Hallam) |
First Resolution read a Second time.