§ The Parliamentary Under-Secretary of State for Trade and Industry (Mr. David Trippier)
I beg to move amendment No. 6, in page 3, line 18, leave out 'may' and insert 'shall'.
Clause 3 relates to the disposal by the Secretary of State of the assets which will be vested in him on the dissolution of the National Film Finance Corporation. I have on previous occasions outlined the Government's intentions in that respect. Some concern was expressed in Committee that the discretionary nature of the present drafting of the Bill did not impose a sufficient duty on the Secretary of State to ensure that any such property, right or amount would be used for purposes connected with the British film industry.
I accepted the thrust of the argument presented by hon. Members and undertook to table an amendment which would convey the same obligation. Amendment No. 6 is designed to reflect more clearly the Government's intentions in respect of the disposal of the NFFC's assets. I trust that hon. Members will feel that it meets that purpose and that they will support it.
§ Amendment agreed to.
Mr. Deputy Speaker
With this it will be convenient to take amendment No. 32, in page 3, line 34, at end insert—'(3A) The conditions referred to in subsection (3) shall include a condition that the company to which any right may be transferred under that subsection shall transfer to the Secretary of State one special share which entitled the Secretary of State to exercise a right of veto over the transactions of the company if he deems that they fail to satisfy him as to the matters specified in subsection 3(a) and (b).'.
§ Mr. Gorst
The purpose of amendment No. 7 was to ensure that the company known as the son of NFFC was set up on terms that were known in advance to Parliament. The Minister's arrangements were not available to us in Committee in any detail, and many of us felt concerned about that. Indeed, it was only yesterday that those who have taken an active interest received the heads of agreement from the Department.
The amendment was originally intended to ensure that discussion had to take place on Report. It is fair to say that, having seen the heads of agreement, the amendment has a rather more substantial purpose than purely probing. The question that has to be answered is whether the terms are satisfactory from the point of view of protecting the new arrangement for the British film industry from being dissembled, dispersed or in any other way disposed of after a short or medium period.
Our information was sketchy, general and rather unspecific when it should have been precise. It raised, and still raises, a number of unanswered questions. One is still not satisfied that the Secretary of State's powers are as adequate or complete as they should be in order to guarantee the company. Perhaps they are, but not on the evidence so far available. I concede that the Minister has taken a lot of trouble to inform us, but he has not yet succeeded in satisfying us.
I understand from the draft agreement that a new limited partnership will be formed. I understand from my researches that a limited partnership means that the partners will be divided into those who would be called general partners and others who would be called limited partners, the latter contributing to the partnership assets of a specific amount in money or money's worth and enjoying immunity from liability beyond the amount so contributed. However, an essential condition of that immunity is that a limited partner should not take part in the management of the business.
I presume that the purpose of that rather uncommon arrangement is to ensure that the members of the consortium are unable to interfere too much in matters other than the establishment of policy. So far, I would say, so good. But the problem arises that we do not know whether the initial members of the consortium are to be general or limited partners. If they are general partners, they will have an unlimited liability.
It is clear from the heads of agreement that the Government will not in any sense be a general partner, 802 since it is specifically said that only British companies will have that status. Therefore, I understand that if they are general partners, they will have the capacity, first, to have an unlimited liability, but, secondly, to interfere with the activities of the chief executive, about which a great deal of concern was expressed in Committee. When my hon. Friend the Minister enlightens us further on this point, I hope that he will be able to say exactly what will be the status of the various partners.
Another aspect of limited partnership puzzles me. The 1907 Act, which formed that arrangement, stipulated that there could be not more than 20 partners in such an arrangement, unless they were in surveying, auctioneering, valuing, estate agency, land agency and estate management, which clearly none of the partners is or is likely to be. Therefore, one foresees that the arrangement will be curtailed to not more than 20 participants within one consortium. Can my hon. Friend confirm that or tell me that I am wrong? If he confirms that, will he say why it is to be so severely curtailed? Those are the questions that seem immediately to occur to me on the structure that is proposed.
Various options are open to us in deciding whether to press the amendment. We can give the Secretary of State the benefit of the doubt; we can pass the Bill unamended and wait and see how history works itself out; we can write amendment No. 7 into the Bill so that the Secretary of State must tell Parliament more each year or whenever anything is happening and he is coming to an arrangement; or we can insist on amendment No. 32, which has been tabled by the Opposition, about which we had a great deal of discussion in Committee and in which many of my hon. Friends were sympathetically interested. In other words, we can remain sceptical about the Secretary of State's arrangements and demand that he has a fall-back position in the shape of a special share.
My preference would not be for the first of those three options — to give the Secretary of State the benefit of the doubt—not because I do not trust him, but because, in effect, it is unlikely that the arrangement which is being entered into can be judged in fewer than three years or more probably in five.
We cannot foretell either the market or what any future Government might feel disposed to do about this arrangement. Therefore, I believe that we should have something far more concrete available to the House for monitoring the position.
I prefer a combination of my amendment and amendment No. 32, which the Opposition have tabled. The truth of the matter — and we went into this in considerable detail on the last group of amendments—is that, because the industry still operates in an unfree, fettered market, the duopoly will continue and the menace of the kid glove, the unspoken agreement, will persist. Therefore, I believe that Parliament's job is to act as some form of long-stop referee.
I hope that my hon. Friend will now be in a position to answer some of the questions, many more of which arise, on the document which he has given to us. I am sure the House will want to be satisfied about those, too, but I shall not delay it any further by going into that kind of detail.
§ Mr. Gould
Like the hon. Member for Hendon, North (Mr. Gorst), I am grateful to the Minister for his sending 803 to each member of the Committee, I believe, a copy of the draft memorandum of understanding with the new consortium. That has been extremely helpful. It gives us some more or less tangible idea as to how the Minister's mind is working. However, it leaves us with some difficulties because it is obviously still a draft memorandum and it fails to satisfy at least the Opposition on what is perhaps our central concern — that there should be something, preferably in the Bill, to enable the House to monitor the activities of the consortium and how they are likely to affect the future of the film industry. The difficulty is that the draft agreement, which may in the fullness of time become a legally binding contract, is likely to operate outside the attention of Members of the House.
The draft agreement goes some way, in intention if not in mechanism, to meet some of the points made in Committee. It suggests, although we have yet to see the draft specification for the chief executive's role, that the Government and the consortium recognise the importance of some independence on its part. We have perhaps less reason to be pleased about the extent to which the memorandum recognises that the cultural significance and future of the industry as a whole should also weigh in the considerations of the consortium. In other words, it should be not just the commercial interests of that particular group of companies which should determine its decisions and actions.
One of the problems here is that, as the statement issued by the six constituent bodies of the industry points out, even as the draft memorandum stands, the consortium may exist solely or at least principally to serve the commercial interests of the constituent parts and have very little to do with the future of the industry. For example, that statement — which I again commend to the attention of the Minister—raises the possibility that the constituent parts of the consortium may see it simply as a means of sharing the risk in projects in which they may have lost faith. They will be able to lay off the risk by handing it over to the consortium. If they entrust a particular project to the consortium and find that it has exceeded their expectations, the danger is that they may poach on the consortium and draw the project back into their own grasp. There is very little in the draft memorandum, as we see it at present, to explain how these various difficulties are to be avoided and reduced.
I believe that we still have not resolved the fundamental problem — that the Government are intent on handing over both the resources and the responsibilities in this area to a private firm, whereas hitherto many people have considered that, if there is to be an injection of public money, such responsibilities should be undertaken by an institution in which the public interest is at least represented in some way or other.
One way of achieving that, as the hon. Member for Hendon, North explained, is to ensure that at some point those matters are brought to the Floor of the House. I believe that his amendment would to some degree achieve that objective. I am entirely in agreement with him that some such mechanism for public and parliamentary accountability ought to be put in place.
There is a whole range of further anxieties. I shall not weary the House by rehearsing them all, because many of them were adequately covered in Committee. However, 804 I single out the very short-term nature of the obligation being entered into by the consortium. I am extremely concerned about what might happen if, after three years, the consortium simply said it had not worked and its members proposed to withdraw. We need further assurances from the Minister as to what the Government would do. Who would own the property at present in the hands of the National Film Finance Corporation? Does he recognise that it is in every sense public property — property that has arisen by virtue of a levy, property that belongs to the industry as a whole? Can he give us an assurance that, even if the consortium for one reason or another fails, the Government's support for and interest in the industry will continue and that that property belonging to the industry will continue to be devoted to the purposes of the industry?
I wish to reinforce the questions asked by the hon. Member for Hendon, North about that interesting creature, the limited partnership. I understand that, for some purposes at any rate, this topic will arise on a later group of amendments, but it might be just as well if the Minister could answer some of these questions now. The point that I am particularly interested in—the answer to which I could perhaps have discovered if I had looked up the 1907 Act but with which I think he may be able to provide me—is to what extent the partners can exchange or change roles. Can someone who has been a limited partner suddenly decide to become a general partner and vice versa? Who is to be what? What is the purpose of this distinction in this case? Why has this particular mechanism been set up?
I turn now to amendment No. 32, which suggests that, before transferring what is in effect public property to this new consortium, the Minister should make it a condition that something in the nature of a golden share be transferred to the Government. I find it hard to believe that the Minister could object to that in principle, since he must know that his right hon. Friend the Secretary of State has heartily and strongly endorsed the whole concept of the golden share in defending his actions in selling off shares in British Aerospace. In a letter, which has been published, he has made a powerful defence of this whole mechanism. It is, of course, a device which is now used by the Government in a whole range of privatised enterprises — Cable and Wireless, Amersham International, Jaguar, Britoil, Enterprise Oil, British Telecom and British Aerospace. It is a very long list. I cannot believe that there could be any objection in principle to something which has been sanctified by Government practice. Therefore, I think the Minister will have to explain why, if in all those other cases a golden share was a proper means of protecting the public interest, for some reason in this case, which in its nature and all its central aspects is on all fours with the others, it is not considered appropriate.
The NFCC was important to the future of the film industry, not just because it was the means by which money was made available to the industry. The corporation did an excellent job in deciding how that money should be spent. Many excellent films — more recently, "Another Country" is a good example — depended for their production on money provided through the NFFC.
The real importance of the NFFC was not just as a conduit for money, but as a statement by the Government, 805 and by the community at large through the Government, that they had a stake and interest in the future of the British film industry.
My fear about what is proposed in the Bill is that that statement of support will be lost, and that, unless we can somehow inject into the film industry that element of public interest and accountability, the industry will be left to go its own way, and its own way may be a downward spiral.
§ Mr. Norman Lamont
I am grateful to my hon. Friend the Member for Hendon, North (Mr. Gorst) and the hon. Member for Dagenham (Mr. Gould) for responding with some modified enthusiasm for the draft heads of agreement which I circulated to members of the Committee. Even if hon. Members do not agree with them entirely — and even if they do not go as far as they would have wished — they at least clarify some of the questions that were raised in Committee. This amendment is a convenient opportunity to enlarge on some of the points that could not be answered then.
My purpose in putting the draft heads of agreement before members of the Committee was to try to reassure them, for I recognised the legitimacy of the point that the hon. Member for Dagenham made about wanting to be assured that this was not just a commercial organisation but a body which would have regard to the cultural aspects of film making and would be a force towards underpinning that important aspect of our cultural life. The provisions of the draft heads of agreement do just that.
I do not wish to weary the House, but in addition to answering the questions that have been put to me I shall comment on the chief executive, the chairman and the role of Government director, points which were raised in Committee.
The principal participants in the "son of NFFC" announced on 25 January the details which we are now discussing. As I pointed out earlier, they have decided to call the new body the British Screen Finance Consortium. It will be structured as a limited partnership, initially comprising the four organisations already identified — Channel 4, Rank, Thorn-EMI and members of the British Videogram Association — together with a general partner. This general partner will be a new limited liability company to be owned jointly by the limited partners and will undertake the management of the business.
The company will have a board on which the major investors, together with the Government, will be represented. The main functions of the board will be limited to the definition of the parameters within which the chief executive will make all major editorial and investment decisions.
I was asked about the limit of 20 in the limited partnership under the 1907 Act. This can be enlarged by order of the Secretary of State, and an application for such an order would be favourably considered.
The partners could, by agreement at some future date, form themselves into a company. The Bill—which will, we hope, be amended in our proceedings later tonight—preserves flexibility for the "son of NFFC" to be a partnership or a company.
Hon. Members also wanted to know about the chief executive. At one point it was even suggested that the chief executive should be independently appointed. That would be difficult to reconcile with the reality that we are 806 discussing a principal employee of a private company, albeit a private company in which there will be strong Government involvement and continuing Government interest and support.
I recognise the sincere concern that was expressed that the chief executive might be biased or simply an extension of the interests of the various partners in the consortium. I have been given assurances by the partners. The chief executive's role will be to plan, direct and co-ordinate the operations of the company within the framework of policies established by the board of directors so as to ensure both that the company's objectives are achieved and that the company fulfils its responsibilities.
In practical terms, the chief executive is likely to be the ultimate decision-maker of whether to support particular films. It would be silly to assert that the chief executive will be independent in the sense of not being accountable or being wholly without restrictions on his authority or judgment.
I know that none of the partners wishes to exercise day-to-day supervision and that, within broad guidelines, the chief executive will be free to make his or her own commercial and artistic judgments. There will, within a few days, be advertisements for the recruitment of the chief executive.
Hon. Members were also interested in the role of the chairman of the management company of the British Screen Finance Consortium. His appointment is to be subject to Government approval. In broad terms, the chairman will be expected to set the policies of the company and support the chief executive and, in particular, he will need to ensure that the company's objectives, policies, plans, organisation and external results satisfy the interests of the shareholders.
He will also want to ensure that the operations of the company are carried out in a manner that respects the interests of the recipients of the loans and the film community at large. In addition, I would expect him to keep in mind the terms of the contractual relationship with the Government and the need for responsible stewardship of the assets contained in the portfolio.
Lest, when I referred to the interests of shareholders, I detected from Opposition Members a frisson, they will recall what I said about dividends not being expected in the first three years. I hope, therefore, that before they get too alarmed over my statement they will bear in mind what I said in Committee.
The question of the director to be nominated by the Government was raised in particular by my hon. Friend the Member for Hendon, North. It goes without saying that the Government director, like all directors under common law and the Companies Act, must have general responsibilities to the BSFC management company for the control and management of its business. In common with Government nominee directors on the boards of other private sector companies, he will not be a delegate on the board on which he serves. His duties as a director are owed to the management company, but he will have further responsibilities stemming from the fact that the Government have a special contractual and financial relationship with the consortium and will therefore need to take special interest in the consortium's affairs.
We regard the chairman as the principal point of contact in our discussions on the consortium's performance and strategy, but we shall on occasion seek the opinion of the Government director on these and similar matters. For his 807 part, the Government director will seek to ensure that the Government are informed promptly of any significant developments of interest to us, whether as the providers of finance or more generally in the way of the Government having an interest in the film industry. In short, the director will be the Government's watchdog in the sense of seeking to ensure that the terms on which the Government have agreed to fund the consortium are observed.
The hon. Member for Dagenham referred to monitoring. I have been outlining how we shall be monitoring through the Government director. I take his point about Parliament's role and the need for reporting to the House. I hope that I shall be able to respond constructively and favourably to a later amendment which was tabled by my hon. Friend the Member for Hendon, North. However, the amendment is rather ambiguous and much depends on what my hon. Friend thinks it means. I accept that there should be some monitoring by Parliament and some reporting to Parliament of what has been happening. I shall try to respond in a helpful manner to my hon. Friend and his amendment.
I turn to the discussions that have been taking place with a view to the contractual arrangements with the consortium. Obviously, until the partnership is formed, it will not be possible for the Government to make a contract with it. However, in our discussions with the prospective partners we have reached agreement on what the contract is likely to contain. Indeed, hon. Members have a copy of the document. The document, of necessity, is no more than a statement of intent at this stage, but it represents the agreed intentions of the four participants and the Government and it has been initialled by both sides. I shall draw attention to its salient points.
First, the Secretary of State agrees to license to the consortium the portfolio of the NFFC's rights and interests in films. The hon. Member for Dagenham asked what would happen to the assets and the answer is that they are licensed. In effect, they are on loan. If anything went wrong with the consortium, or if we felt that it was not doing what was in the interests of the British film industry, the Government would be able to retrieve the assets. As the House knows, we shall also make available £1.5 million for five years. That is a commitment that gives some security for the future. It is a commitment by the Government to continue supporting the organisation for five years.
§ Mr. Brinton
Will my hon. Friend confirm that the £1.5 million that has been offered by the Government for five years will not become involved in taxation? Will he address some of the money for use in investment?
§ Mr. Lamont
The money will be made available by loans to the consortium. We envisaged originally that the money would be made available by grant, but it will be made available by loan at the request of the partners. They see that as the most convenient arrangement for them for tax purposes. These amounts, which will take the form of loans, will be drawn down only against need and will be used wholly for investment in British films and the reasonable operating costs of the consortium. For its part the consortium will discharge, from funds set aside by the NFFC and transferred by the Secretary of State to the consortium, forward commitments agreed by the NFFC 808 and outstanding upon its dissolution. The consortium proposes to obtain from its members at least 1.1 million a year for three years. The initial members do not envisage that any dividends will be paid during the first three years.
The structure and organisation of the new body will be subject to the approval of the Secretary of State. Future entrants to the consortium are welcomed on matching terms provided that they are bound by the agreed arrangements. The Secretary of State and each full member of the consortium will be entitled to representation on the board and the Secretary of State will also have the right to approve the chairman. I repeat what I said in Committee, which was that we see this as a dynamic and growing body. We would welcome other participants in it and that could be a means by which more finance will be channelled for the benefit of the industry.
The Government have received representations that the commitment of the NFFC to the support of short films should not be allowed to die when the NFFC is dissolved. In the past the Eady levy has provided a valuable, if somewhat artificial, incentive for the distribution of short films to cinemas. The demise of the levy will therefore remove what remains of that incentive. Yet it is widely, if not universally, recognised that the short film — the hon. Member for Islington, South and Finsbury (Mr. Smith) is interested in this — is the ideal nursery or proving ground for new talent, be it producers, directors or whatever. Moreover, there is still a place in the cinema programme for a well made short. It has been suggested to us that it is a natural extension of some of the project development activities which the development scheme is intended to foster. We have therefore decided to enlarge the scope of the scheme to embrace the financial support of the production of shorts. Amendments for that purpose have been tabled.
Secondly, both the consortium and the Government recognise the concern that is expressed in some quarters that the performance of this activity by the consortium might be thought to work to the disadvantage of the independent film maker. It was in recognition of that concern that we said that we intended to make it a condition of the agency contract that the consortium must use independent consultants with no financial interest in the consortium or its component companies.
The heads of agreement conclude with a number of safeguards. First, the management company of the consortium must be a British company as that is defined in the Bill. The defintion is based on previous legislation. Secondly, the members of the consortium may withdraw but may not dispose of their interests except with the approval of the Secretary of State and all the other members of the consortium. Thirdly, there are conditions on the exploitation of the NFFC portfolio, and any revenues generated from the portfolio must be used for investment in British films. Fourthly, the Secretary of State may withdraw the licence if the consortium is wound up or if he is not satisfied that the funds that he has made available are being invested in British films.
I think that the heads of agreement take account of the various points raised by hon. Members at earlier stages of the debate. However, it has been suggested that the contract should oblige the consortium to repay moneys advanced if the company failed to honour its commitments. At that time it was assumed that the Government's contribution, as I said in response to my hon. Friend the Member for Gravesham (Mr. Brinton), 809 would probably take the form of grants. This matter has not been settled but it seems likelier that the consortium would prefer to receive support in the form of loans. My Department will certainly be monitoring the use made of the portfolio and the Government's contribution, and under the contract it would be open to the Government to sue for repayment of grants. Loans could be repaid if they were misapplied in any way.
Although we have debated this matter and I have considered it, I am not persuaded that it would he reasonable to go further by requiring the repayment of previous contributions that have been properly applied. In finalising the contractural details, we shall ensure that any sums made available by way of grant or loan which are not applied for the purposes intended shall be immediately recoverable.
The discussions that we have had with the respective partners have laid a foundation for a contract that should satisfy any fair-minded observer that there are proper and reasonable safeguards for the NFFC's assets and that public money is given to this body so that we can further the interests of the British film industry. I have tried to build into the agreement the points that worried the Committee.
§ 8 pm
§ Mr. Gorst
I am grateful to my hon. Friend the Minister for the considerable further explanation that he has given. It would be difficult to probe further on this occasion, even if further probing were necessary. If further probing is necessary after the industry and others have given more thought to my hon. Friend's statement, clearly the other place will be the best place in which to do that. I beg to ask leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
Amendment made: No. 8, in page 3, leave out line 21 and insert—
'(2A) Without prejudice to the generality of subsection (2), the Secretary of State may, in pursuance of that subsection—
(3)'.—[Mr. Norman Lamont.]
§ Mr. Norman Lamont
I beg to move amendment No. 9, in page 3, line 24, after 'company', insert 'or partnership'.
Mr. Deputy Speaker
With this it will be convenient to discuss Government amendments Nos. 10, 11, 13, 16, 17 and 20.
§ Mr. Lamont
This series of amendments relates to the concern that not enough is known about the structure of the new body. The participants in that body have agreed that the option of a limited partnership would be preferable to that of a company as envisaged in clause 3(3). We see no reason not to accommodate that preference. We believe that that body can meet the needs of the industry perfectly well. These amendments are, therefore, necessary for that purpose.
The intention is that a limited partnership will be established, as my hon. Friend the Member for Hendon, North (Mr. Gorst) identified with his usual perception, under the Limited Partnerships Act 1907, in which each of the participants will be a limited partner and in which 810 there will be a general partner. The general partner will be formed as a new limited liability company with a nominal share capital owned jointly by the limited partners in their profit-sharing ratios and enjoying only nominal profit-sharing rights.
Although it would be undesirable and unnecessarily restrictive to insist that all the limited partners must be British companies, I believe it is important that the general partner should be a British company, and amendment No. 13 makes provision for this.
These amendments provide a degree of flexibility for the structure of the successor to the NFFC. while continuing to ensure that effective control will remain in British hands. I invite hon. Members to support the amendments.
§ Mr. Gould
In the previous debate the Minister did not answer some of the questions put by myself and the hon. Member for Hendon, North (Mr. Gorst) about the nature of a limited partnership. Why have the members of the consortium chosen this particular form? Which of them is to be a general partner, and which is to be a limited partner? Is it intended that the members of the consortium should enter a partnership with the limited liability company, or is the partnership to own the company?
§ Mr. Lamont
I thought that I had given a crystal clear answer. The consortium decided for tax reasons that it preferred to be a partnership. That was done after consultation with, I believe, Coopers and Lybrand about the most suitable vehicle for the members of the consortium.
I thought I had made it clear that the general partner would be responsible for the management of the business. The general partner would be a limited liability company which would be owned by the limited partners.
§ Mr. Lamont
As far as I know, there is no problem about that. There is the global ceiling of the 20 participants within one consortium to which my hon. Friend the Member for Hendon, North referred. That arrangement can be altered. I would not have thought that there was any problem — even if one has 20 participants — about including other people in the general partnership. Other people might decide to join the partnership on different terms. I should have thought that the general partnership could be enlarged to accommodate other people within it. Not everyone will want to put up the same amount of money or to have the same obligations. It may be that the founding partner will remain as the general partner for some time. I have made it clear that we envisage the consortium being a dynamic body which should grow. We hope that it will attract more money.
§ Mr. Gorst
I had not intended to intervene in the debate, but my hon. Friend the Minister has raised one doubt in my mind. If there were initially a general partner, that would indicate to me that there was a degree of confidence in the future of the operation. However, if there were adverse circumstances, I would be worried about whether the general partner could suddenly turn round and say, "From now on, I want to be a limited partner." If the general partner did that, I would say to myself, "He thinks that this body will go into the red. He 811 wants to limit his liability." Will my hon. Friend comment on that? That is not a possibility which any of us would like to entertain.
§ Mr. Lamont
I cannot bind people in the way that my hon. Friend the Member for Hendon, North implies. He will know—it is written into the heads of agreement—that the consortium has said that it intends that the £1.1 million should be available for three years. That is the limit of the consortium's commitment at the moment. The members of the consortium collectively have said that they intend that that money should be available. We envisage that this body will go on, and we have shown our commitment to it by making it clear that our £1.5 million will be available for five years. I hope that my hon. Friend is reassured by knowing that, after two years, we intend to review the finances of the consortium and how it is working to ascertain whether the arrangements are working precisely as we want them to work for the benefit of the British film industry.
§ Mr. Lamont
No; that is not right, because the general partner will be a limited liability company. To clarify this point precisely with the full benefit of legal advice, I shall write to my hon. Friend and make the position crystal clear.
§ Amendment agreed to.
§ Amendments made: No. 10, in page 3, line 26, after 'company', insert 'or partnership'.
§ No. 11, in page 3, line 32, after 'company', insert 'or partnership'.—[Mr. Norman Lamont.]
§ Mr. Trippier
I beg to move amendment No. 12, in page 3, leave out line 40 and insert—'(4A) Where in consequence of any such order as is mentioned in subsection (2) any liability of the Corporation becomes vested in the Secretary of State, the Secretary of State may arrange for the liability to be transferred, on such terms as may be agreed between him and the company or partnership, to any British company or partnership in whose case he is satisfied as to the matters mentioned in paragraphs (a) and (b) of subsection (3).(4B) In this section—'.During our discussions in Committee, the Government explained that they intended to pass to the British Screen Finance Consortium the unfulfilled and forward commitments made by the NFFC together with any other cash from the NFFC's assets to meet those commitments. That will mean that film makers who have obtained an agreement from the NFFC to support a particular film need not fear that when the NFFC is dissolved they will be left stranded.
812 The amendment is necessary to enable my right hon. Friend the Secretary of State to pass such commitments to the consortium. I believe that the amendment is in the interests of film makers and I invite right hon. and hon. Members to support it.
§ Amendment agreed to.
Amendment made: No. 13, in page 4, line 6, at end insert—
'"British partnerships" means a limited partnership formed in accordance with the Limited Partnerships Act 1907 in which the general partner within the meaning of the Act, or (as the case may be) each of the general partners, is a British Company;'.—[Mr. Norman Lamont.]
§ Mr. Trippier
I beg to move amendment No. 14, in page 4, line 8, after 'person', insert 'or combination of persons'.
§ Mr. Deputy Speaker (Mr. Harold Walker)
With this it will be convenient to consider Government amendment No. 15.
§ Mr. Trippier
The purpose of this amendment is to meet the anxieties expressed by some hon. Members that the current drafting of this part of the Bill is not entirely clear. In clause 3, the definition of "British company" is a company over whichtwo or more Commonwealth citizens are together in a position to exercise control".However, the definition of "control" speaks of the powerof a person to secure,by specified means,that the affairs of the company are conducted in accordance with the wishes of that person.As hon. Members will be aware, the Interpretation Act 1978 provides that the singular includes the plural. Nevertheless, to give assurance to some hon. Members, and for the avoidance of doubt, we propose that the Bill should be amended to include the words "combination of persons". The amendment is helpful in removing any possible element of ambiguity. I invite right hon. and hon. Members to support it.
§ Mr. Gould
I am grateful to the Minister for tabling the amendment. The Opposition are delighted to welcome it, but it might be just as well if we were to record the part played by the Copinger Society in bringing the point to our attention and having played some role in promoting this monumental change to the Bill.
§ Amendment agreed to.