HC Deb 05 November 1973 vol 863 cc49-50W
Dr. Gilbert

asked the Secretary of State for Trade and Industry if he will seek powers to make it a criminal offence for directors of financial institutions to fail to disclose to the boards of companies for which they act as financial adviser that they are seeking to arrange a ware-housing operation—as defined in Command Paper No. 5391—in the shares of those companies.

Sir G. Howe

The proposals in the White Paper indicate how the Government propose to deal with warehousing attempts. I have no evidence to suggest that any such operation has been attempted in the particular case which I understand the hon. Member to have in mind.

Dr. Gilbert

asked the Secretary of State for Trade and Industry if, in his proposals for the reform of company law, he will seek powers to require financial institutions that have accumulated a stake of 5 per cent. or more in another United Kingdom company not to dispose of that holding for a minimum period of three years.

Sir G. Howe

I shall include in the Companies Bill provisions for dealing with warehousing and insider trading. It would be wrong indiscriminately to freeze the holdings of financial institutions in particular companies as suggested by the hon. Member.

Dr. Gilbert

asked the Secretary of State for Trade and Industry if he will seek powers to make it a criminal offence for a financial institution, or its directors or employees, simultaneously to act as financial adviser to another company and to hold and acquire shares in that company.

Sir G. Howe

I propose to make it a criminal offence for insiders, including professional advisers, to deal in a company's shares for profit when in possession of confidential price-sensitive information.

Dr. Gilbert

asked the Secretary of State for Trade and Industry if he will seek powers to impose appropriate sanctions in cases where financial institutions have been involved in major conflict of interest situations; and if he will make a statement.

Sir G. Howe

I shall be including in the Companies Bill proposals for dealing with misuse of inside information and other potential sources of conflicts of interest. If the hon. Member has any concrete evidence of such misuse, I would be glad if he would let me know.