§ Mr. Peter Rees
I beg to move amendment No. 60, in page 70, line 34, leave out 'fourteen' and insert 'ten'.
§ Mr. Deputy Speaker
With this it will be convenient to take Government amendments Nos. 68, 80, 88, 89, 148 and 149.
§ Mr. Rees
The amendments relate to certain of the time periods laid down for fulfilment of obligations imposed by the Bill. I believe that the point was in part stressed by the Opposition in Committee. It is thought more appropriate to have shorter periods for the discharge by companies of their obligations under the Bill.
§ Mr. Anthony Nelson (Chichester)
I am interested in the reasoning behind the amendment to reduce the time period from 14 to 10 days. It is proper that there should be an obligation for people who acquire interests in companies at or above the relevant amount to do so within the five days set out in clause 58(6). In clause 59 it is proposed that, where the Secretary of State makes a regulation that has the effect of reducing the percentage and thus bringing within the category a number of people who have shareholdings in excess of that amount, they will have an obligation to declare their interests, albeit that the interest was acquired previously and did not have to be notified.
I suppose that the reduction from 14 tp 10 days is reasonable, but on the face of it it seems a little arbitrary. It is only a minor point, but what led the Government to make the change?
Under clause 59 the Secretary of State can by regulation made by statutory instrument from time to time prescribe different percentages in the case of companies of different classes or descriptions. What criteria may be applied in deciding what companies or categories of company will have various percentages applying to them?
In the past I have been critical of the extent to which shareholdings can be built up covertly or even openly in major companies or sensitive or strategic industries. In companies that have interests of national importance or where, for example, a considerable number of employees are involved, it is proper to ensure that the shareholding built up by an investor either from within or outside the country is at a level that requires notification and publication at an early stage. 227 I fear that the regulations in clause 59 may not be used sufficiently stringently. I seek an assurance that Ministers will consider from time to time using the important provisions to ensure that major, strategic and large employing companies are protected from potential predators by the insistance that, if shareholdings are built up to a fairly small percentage, in certain instances it will be necessary for them to be notified publicly.
§ Mr. Peter Rees
I did not have the privilege of serving on the Standing Committee, but I have taken the pleasurable precaution of reading the debates and I noticed the powerful contribution of my hon. Friend the Member for Chichester (Mr. Nelson) on the question of concert parties.
I feel that it would be wrong for any Administration to tie themselves too closely to the kind of situation in which the Secretary of State might feel disposed to introduce this kind of regulation. It will, after all, be open to challenge and debate in the House. As my hon. Friend knows, we are in a highly fluid and fast-moving situation where the Secretary of State must balance many considerations before weighing into the matter. To tie himself in advance to a statement on the kind of criteria that he wishes to apply might be rash. However, I shall take away my hon. Friend's point to see whether it might be prudent and helpful to evolve some useful guidelines.
There is no disposition in this Government or, I am sure, the previous one to spring a change on the market. One likes these matters to be pondered carefully in advance. One would also like to feel that certain principles could be distilled, but I am a little hesitant to tie the hands of any Secretary of State. Although the guidelines would not have the force of law, once published they would have a certain sanctity.
My hon. Friend rightly challenged whether there was a deep underlying rationale for reducing 14 to 10 in four or more cases and 21 to five in amendment No. 80. The answer is "No". One has to try to balance various factors. After the informed debates in Committee, it was felt that the period should be shortened, and I am happy to concede that the precise number of days, weeks or years was slightly arbitrary. It is better to be candid. No doubt an equally good intellectual case could be made for 11 days or nine. These are practical matters.
Although I do not wish to hold out the awful prospect of another Companies Bill within a measurable space of time, these matters are subject to review. If the House feels we have it badly wrong, sometime—not perhaps in the lifetime of this Parliament—we could come back to it. However, I believe that a fair balance has been struck, and I hope that the amendments will commend themselves to the House.
Amendment agreed to.