HC Deb 07 February 1968 vol 758 cc384-6
28. Sir Knox Cunningham

asked the President of the Board of Trade what proposals he has for further legislation in the field of company law; and when they will be laid before the House for consideration.

Mr. Darling

We hope, later in this Parliament, to propose legislation to deal with the Jenkins Committee's recommendations which were not dealt with in last year's Companies Act, and will consider other proposals.

Sir Knox Cunningham

As Jenkins is now five years old and there has been no general implementation of the Report, is the right hon. Gentleman saying that in this Parliament we shall have a new Companies Act? Can we have some action?

Mr. Darling

Yes, Sir. We propose and hope to introduce the legislation in this Parliament. As for the Jenkins Committee's Report being somewhat out of date, as it is in some respects, we are constantly in consultation with the appropriate bodies to see what additional recommendations would have been made if we had a Jenkins Committee at the present time, as it were.

Mr. John Lee

Will my right hon. Friend express support for the proposal to abolish the principle of limited liability so that, when the new companies law is introduced, the shareholder will have to do something for his money?

Mr. Darling

That is a proposal which we have not considered, and I doubt very much whether we shall consider it.

Mr. Michael Shaw

Is the Advisory Committee which has just been reconstituted being used merely to advise on the provisions of the present legislation or to give advice on proposed new legislation?

Mr. Darling

It deals with the operation of the existing legislation and is not advisory on future legislation.

Mr. Maclennan

Will my right hon. Friend bear in mind when considering new legislation the desirability of taking account of developments in European company law with a view to aligning, so far as possible, British and continental law?

Mr. Darling

We certainly have this very much in mind. Not for the legislation which I have already been talking about, but obviously for any subsequent legislation, the possibility of harmonising certain company law, not only in Europe. but on a much wider basis, will have to be taken into consideration.

Mr. Patrick Jenkin

Will the right hon. Gentleman take note that one of the principal subjects still to be covered which was in the Jenkins Report, namely, the establishment of a code for takeover bids, is already being dealt with effectively by the City of London? Does the right hon. Gentleman recognise that there may be advantages in leaving this as a voluntary system of control rather than introducing rigid statutory provisions in an Act of Parliament?

Mr. Darling

As the hon. Gentleman will know, we are in consultation with the Bank of England and the Stock Exchange about the voluntary system. One of the questions which is bound to arise is whether the operators of the voluntary system would like some kind of sanction behind what they wish to do. This is one of the issues that we are now discussing and considering.

Mr. John Fraser

Will my right hon. Friend recall certain discussions which took place on the last Companies Act? Can he confirm that the next one will contain provisions for industrial democracy and for workers to share in the profits and capital appreciation of companies?

Mr. Darling

I cannot give any guarantee that it will be in the next legislation, but, as I said in my previous reply, we are considering other proposals.