§ Mr. HarveyTo ask the Chancellor of the Exchequer, pursuant to his answer to the hon. Member for Newham, North-West (Mr. Banks) of 25 November,Official Report, columns 71–72, what powers the Government can exercise under the terms of each of the golden or special shares they hold. [7103]
§ Mr. JackSpecial shares are confined to those companies where the Government judge that they need to retain specific limited powers over the future ownership, control, or conduct of a privatised company. Powers are generally limited to:
- (i) a clause providing that the holder of the special share may redeem the share at any time for its face value (usually £1);
- (ii) a clause limiting shareholdings by any one person, or group of persons acting in concert, to 15 per cent., with powers for the board of directors to disenfranchise any shareholder in breach of this limit to the extent of the excess;
- (iii) a clause entrenching itself, and the two clauses above, against amendment unless there is both a resolution passed by the ordinary shareholders at general meeting in the usual way and the holder of the special share has given written consent.
Certain other provisions are included in specific special shares, mainly in connection with defence or security issues, relating to the appointment, and nationality, of chief executives, and other directors, the disposal of material assets and the aggregate level of foreign ownership.
Special shares do not enable the Government to interfere in the day-to-day conduct of the privatised business. They do not carry any rights to vote at general meetings and entitle the holder to speak only on matters relating to the rights of the holder of the special share.