Mr. Ritchie in moving the second reading of the Com-
panies Bill in the House of Commons on Tuesday laid stress on the need for great caution in amending the law relating to public companies. Legislation that drove away the best class of business men and encouraged the development of professional directors would be disastrous. The Bill now before the House provided first against the evils of directors acting without qualification or taking gifts of paid-up shares.
It also guarded against bogus subscriptions by providing that the minimum, subscription on which the directors would go to allotment should be stated in the prospectus, and that three- fourths of the total amount due on application should be paid up before the company commenced business, and paid up bond-fide by those who had. subscribed. Other clauses pro- vided for the statement in the prospectus of the amounts payable to the vendor or promoters, and the consideration therefor, and for the registration with the Registrar of Joint Stock Companies of all mortgages, which would thus be open to public inspection. The retention or omission of sundry clauses which he did not think germane to the measure would be left to the House to decide in Committee, but he did not propose to ask the House to retain the clause giving pre- ference to trade creditors in respect to debts incurred within three months of the winding-up of a company. After a discussion, in which Members on both sides of the House in the main supported the Bill, it was read a second time with- out division, the Motion referring it to the Grand Committee on Trade being carried by 138 votes to 52.
Previous page
